City is hawkish on tax collections; New buildings now taxed sooner.

Byline: Danielle M. Williamson 

GARDNER - Mark P. Hawke moved into his newly constructed home in February 2005, but the city didn't tax him on the house until almost 22 months later.

While the mayor was able to defer paying a couple thousand dollars, he said the city was losing income it could have collected much earlier.

"My first, second and third tax bills were for land only," said Mr. Hawke, who began working to change the system for collecting taxes on new property when he became mayor in January. "Once I started asking questions, I found the assessment year runs on a calendar year. That doesn't match up with cities and towns, which run on a fiscal year."

The City Council this month accepted the provisions of Section 40 of Chapter 653 of the Acts of 1989, a section of law that is intended to reduce the delay between the construction and taxation of new buildings. Traditionally, property built between January and June, the end of the fiscal year, has not been taxed until the fall of the next year. The newly adopted law will let the city tax new property built between January and June in the same calendar year.

"If the council had accepted this around the time I built my house, my first tax bill would have been for land only, but my second bill would have been for the land and the house," Mr. Hawke said. "The city could have gotten that money a whole year earlier."

Now is the perfect time for the assessor's office to make the change, Mr. Hawke said, because construction is slow.

"This is probably the slowest construction season Gardner has seen in the last decade or two," Mr. Hawke said. "It'll be a lot less work for the assessor's office to incorporate the new schedule into the way it does business."

According to Assessor Dennis Comee, only three new houses were started in the city between January and May. Assuming they all have occupancy permits by June 30, the city will be able to tax them fully by this fall. With the city's average property tax bill approximately $3,000, that could mean nearly $10,000 more in revenue the city will see this year.

"We've always told people that if their property is built between January and June, they're not going to be taxed until the following year," Mr. Comee said. "People are going to have to adjust."

Mr. Comee said he has been reviewing occupancy permit applications for the first half of the calendar year to determine which properties will be taxed under the new legislation. If the council had not accepted the law, he would not be reviewing these properties until next January.

The change in the assessment schedule applies only to new construction and other improvements that increase the value of one's property. Personal property is not affected by the legislation.

During a good building season, 35 to 50 homes are built each year in Gardner, Mr. Hawke said. If a third of those are completed within the first six months of the calendar year, the city could collect between $36,000 and $51,000 that otherwise would have been put off to the following year.

"I look at it as, `Do you want me to pay you the $100 I owe you now, or a year and a half from now?'" Mr. Hawke said. "I want that $100 now."

NAME: GARDNER CITY COUNCIL