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The Cambridge City Council unanimously voted on Monday to raise property taxes by eight percent for fiscal year 2026 — including a 22 percent increase on commercial property taxes — to the chagrin of many residents and business owners.
The tax rate also includes a five percent increase on residential property taxes, leading to a smaller rate of total growth across residential and commercial property tax rates compared to the increase in fiscal year 25, according to a report by City Manager Yi-An Huang ’05.
But this year’s commercial property tax growth is more than double the increase the Council passed for fiscal year 25, raising concern from business owners. Councilors defended the tax increase on Monday, saying tax increases are necessary to avoid budget cuts.
Councilor Paul F. Toner said it is difficult to keep taxes low while also providing services many Cambridge residents depend on — like emergency response teams, universal pre-k, and new school facilities.
“If people are serious about saying they don’t want to pay increases in taxes, then they need to understand that there’s going to come a day when we have to say we’re going to have to start making some cuts,” Toner said.
But Vice Mayor Marc C. McGovern said that it will be difficult to find places to trim the budget.
“I just want to point out the school budget is 30 percent of the city’s budget. So where are we talking about cutting? We’re talking about cutting this public schools budget,” McGovern said. “Public safety is a big part of our budget. Okay? Where do you want to cut in public safety?”
The budget has been a point of constant tension for the Council this year, as members struggled to fund new programs amid the slowest budget growth the city has seen in a decade.
Business owners criticized the Council over a lack of communication about the tax rate, especially with a large commercial tax increase that directly affects them.
Denise A. Jillson, the executive director of the Harvard Square Business Association, expressed “disappointment and frustration” on behalf of Cambridge business owners. She said many were blindsided by the commercial increase, only learning about it hours ahead of the Council’s first scheduled special meeting on the tax rate.
Jillson immediately raised concern about the proposed rate after learning about it, sending an urgent message to HSBA members informing them of the proposed increase and urging them to weigh in during public comment at the meeting.
“If approved, the commercial tax rate will see a 22% increase that will find its way to our retailers, restauranteurs, hotels, etc. and ultimately, the consumer,” Jillson wrote.
During Monday’s meeting, Jillson said she hopes to see more communication from the Council in future budget discussions.
“What we’re asking as we move forward into the development of the FY27 budget is that you have continued engagement and communication with the Council and that we meet frequently, particularly as the budget process unfolds,” Jillson said. “We could have done that, and probably should have done more of that last time around. And I don’t think any one of us anticipated this kind of a burden.”
McGovern said he believes that the increased property taxes do not have to be felt by tenants.
“They’re concerned about passing these expenses on to their tenants, and they’re afraid that their tenants might leave and then they’ll have a vacancy. Well, don’t pass it on, right?” McGovern said.
Councilor Patricia M. “Patty” Nolan ’80 said a main priority for fiscal year 2026 is keeping residential tax rates low and livable. She also pointed out that many businesses will not see a dollar amount change in taxes.
“Their taxes aren’t even going up in dollar terms because their valuation went down so much that a 22 percent raise in the rate has meant that their actual bill is very similar to what it was last year,” Nolan said.
On the other hand, if if valuation goes up, Nolan said, the tax increase could be detrimental to Cambridge businesses.
“It means that their actual dollars being paid is more than 22 percent. It could be as high as 27 or 30 percent for a few properties, and that is something very challenging for people to sustain,” she said.
—Staff writer Shawn A. Boehmer can be reached at shawn.boehmer@thecrimson.com. Follow him on X @ShawnBoehmer.
—Staff writer Mackenzie L. Boucher can be reached at mackenzie.boucher@thecrimson.com.
