About 25 people rallied outside Cambridge City Hall yesterday to protest failure to institute a property tax reform passed last March 3 and to demand the resignation of City Assessor Rudolph R. Russo because of his alleged conflicts of interest as a major property owner.

The rally, organized by the Cambridgeport Homeowners and Tenants Association (CHTA) and the Russo Tenants Union, accused city manager James L. Sullivan with misleading homeowners about where to place the blame for the heavy property tax burden, Wayne Klug, one of the tenant union members said.

"The reason taxes are so high is not because of workers wages but because the wrong people are being taxed," another member added.

The tenant leaflet said Russo is "ignoring the responsibilities of his office in order to profit personally." They cited "curious low assessment figures" on the 15 pieces of property which Russo owns in the Cambridgeport and Central Square areas.

Last spring some tax reforms were passed by the City Council, such as giving exemptions to needy persons. Barbara Ware, a member of CHTA, said yesterday the exemptions are now given but only on political grounds.

The immediate reason for the rally, Klug said, was a recent decision by Russo to convert a 12 family house at 308 Brookline St. into six luxury condominiums.

According to Klug, after a rent increase was instituted last May, the tenants sent Russo a letter refusing to pay until conditions were improved. Two weeks later, Klug said, all 12 families received eviction notices and Russo announced he was going to build condominiums.

Ware said that three families have already moved out, and only one of the remaining nine is paying the 12 per cent rent increase.

"Housing problems in Cambridge are particularly severe," Klug added, "and this driving of low and middle income people out of homes has got to be stopped."

The tenants union and CHTA have not yet heard from Russo.