Grafton town administrator proposes local option income tax

No one likes a Proposition 2 1/2 override. Not the residents who need to pay the increased property taxes, not the officials who have to hear their complaints, not the town employees whose jobs may be on the line if an override vote fails.

Town Administrator Tim McInerney proposed a different solution Tuesday night to the Select Board — one that won’t help Grafton in its current financial crisis but may help communities down the line.

What if, instead of a Proposition 2 1/2 override, the town could, instead, impose a local option income tax?

McInerney presented the board with the following home rule petition:

Whereas,

• the Town of Grafton has a growing and diverse population and the Town of Grafton is striving to provide quality services to all residents; 
• the limitation proposed by Proposition 2 1/2 restricts the Town of Grafton’s ability to raise money necessary to provide essential quality of life services, such as education, public safety, health and human services and culture and recreation;
• local property taxes are the most regressive tax, which hurts the most vulnerable residents in Grafton. Overrides of Proposition 2 1/2 impact all residents the services received are not commensurate with those costs;
• the town strives for equity and raising a million dollars with a property tax increase would cost the average homeowner $151 annually;
• income taxes are a more progressive way to tax for services, the total filed income tax in Grafton is $935 million;
• withholding .1 percent would yield $935,000 and would cost the average wage earner (75,000 x .001) $75; half the cost for an override of Proposition 2 1/2;
• the Select Board resolves to petition the Commonwealth of Massachusetts to allow cities and tows to vote a local option income tax to provide for a more equitable way to raise money to pay for quality of life services such as education public safety, health and human services, and culture and recreation;
• the Select Board resolves to request that up to .2 percent of income tax be withheld for payments to cities and towns to pay for increased costs associated with a growing community and its needs. Those withholding shall be paid to the town in quarterly payments with other state aid distributions to negate the need to override Proposition 2 1/2.

The Select Board agreed to discuss the resolution, which would need to be introduced to the state legislature, at a future meeting.