As Boston’s property tax burden falls more heavily on residential owners, city officials are scrambling to provide some relief, but with little sign of help from a quick turnaround in commercial values or growth.

According to a report issued this month by the Boston Municipal Research Bureau, business property valuations in the current fiscal year decreased overall by 1.7 percent, while valuations for residential property increased by 4.6 percent. As a result, the residential share of the tax levy increased to 55.9 percent, with the share for business property decreasing to 44.1 percent. In the previous year, the business share was 58. 3 percent, with residential at 41.7 percent.

“FY25 marks the highest share of the levy paid by residential property and the lowest paid by business property in at least four decades,” the Bureau reported. Its conclusion: “The decline in business new growth is of concern given Boston’s heavy reliance on it to fuel overall budget growth.”

On Monday, Mayor Wu announced a new attempt to get relief for residential owners through a home rule petition that would require approval at the State House. Allowing temporary readjustment of tax rates for different property classes, the measure is similar to the revised “compromise” legislation that failed to get approval in December from the senate, with key opposition from Sen. Nick Collins (D-South Boston/Dorchester). Business groups also backed off from supporting the compromise when final figures for property valuations showed the increase in the burden for homeowners would be less than what had been projected earlier by city officials.

One feature added by Wu to the new home rule petition was an increase in the tax exemption for low-income seniors, from $500 to $1,500. The ceiling for eligibility would also be raised to 50 percent of the Area Median Income ($114,000 for a household of one in 2024). Similar tax relief was proposed in a petition filed on Jan. 8 by District 4 (Dorchester/Mattapan) Councillor Brian Worrell, partly aimed at seniors he described as house-rich and cash-poor.

“We hear this all the time,” Worrell said, “grandma, grandpa, or mom and dad bought the house back in the seventies, and they bought the house when it was $100,000 or $50,000, and they never imagined that they would be owning a million-dollar asset — and they have then retired since they have bought that home. And now that they have bought that home and then retired, they’re nowhere near making the amount of money to maintain or keep up with the taxes.”

Worrell is also co-sponsoring a home rule petition filed in December by Councillor At-Large Erin Murphy to increase the exemption for owner-occupants of residential property from 35 percent of its assessed value to as much as 40 percent.

“In a time of rising housing costs and financial pressures, expanding the residential exemption is a crucial step toward keeping Boston affordable and avoiding displacement,” Murphy wrote in a post announcing on the measure on Facebook.

Another new feature of Wu’s petition is a fallback in case in case her proposed tax burden shift between property classes fails once again to get approval. In that case, the city could give rebates to taxpayers with the residential exemption in the current fiscal year. The money would come from “surplus funds” that would have to be appropriated by the City Council.

The Boston Municipal Research Bureau reacted to the fallback in a post on Facebook, saying, it was “pleased to see Mayor Wu’s interest in the tax relief proposal we put forward eight months ago focused on homeowners who cannot afford their property tax increase. We encourage the Mayor and City Council to pursue it along with smaller spending increases in the FY26 budget.”

Last October, Wu Administration officials were still using “preliminary” figures to estimate that, without passage of the home rule petition, the tax bills for the 3rd quarter of fiscal year 2024-25—mailed by Jan. 1 of this year—would increase for the owner-occupant of a single-family home by an average of almost 28 percent. The figure represents one half of the increase that was not billed during the two previous quarters, with the remainder of the increase to be billed in the 4th quarter. Had the measure been approved at the State House, the spike in the 3rd quarter for the same taxpayers, according to city officials, would have been only been 9.9 percent, slightly less than half the current figure.

Based on the final figures from the city’s revaluation, which is required by state law every five years, the tax bills for the same owners ended up increasing by 10.4 percent for the fiscal year, but consolidated in bills for the last two quarters as an increase of almost 21 percent.

In a letter supporting the new home rule petition, Wu added that the average annual increase for all types of residential property was 14.9 percent, with the two quarterly bills going up by almost 30 percent. Officials have warned that some of these increases would be passed on to renters.

When business groups backed off from supporting the earlier home rule measure, they noted that the residential tax increases based on final valuation figures announced in December were in line with increases in previous years. But Wu argued that the failure to approve the home rule measure still led to more residential owners being faced with a “significant increase” in their bills.

“More than 55 percent of all residential property owners,” she wrote, “received a bill with an annual increase greater than 9 percent (or quarter-to-quarter bill jump of more than 18 percent).” At the same time, according to the mayor, tax bills for commercial property decreased by an average of 3.4 percent, with a 7 percent drop for office buildings.

For individual property owners, the assessed values could be higher or lower, sometimes by significant amounts. For one “architecturally significant” late-19th century home in Dorchester with six bedrooms, the assessed FY 2025 value increased over the 2024 figure by $584,700 or 35.2 percent. Figures compiled by a local resident from the same neighborhood showed many other homes with increases, and some with decreases, but by smaller amounts.

District 3 (Dorchester) City Councillor John FitzGerald said in an interview last week that he had been receiving “a lot of emails and calls” from constituents who questioned the revaluation figures, whose overall increases he characterized, by comparison with those from previous years, as “slightly above average.”

He acknowledged that “obviously, the people who are calling are the folks who are upset at the increase in their taxes, but it’s not only just the increase in the taxes, which is basically just the tax rate and the valuation of your home; it’s the discrepancies we’re seeing amongst all of the valuations.”

In a follow-up interview Monday, FitzGerald said he had combined a measure of his own with a similar one filed earlier by Councillor Murphy to have the revaluation practices examined at a public hearing.

“I think people are misdirecting their anger at the tax rate,” he concluded, “rather than the assessed value of their homes and how that came to be.”

When asked about the greater residential burden without the mayor’s proposed tax shift, FitzGerald responded, “If the commercial base were to get its feet swept out from under it, and we were to help that process occur, all that would do is actually further drive up residential taxes in the future, when we’d have to shift more back to residential.”

Even without the city getting new power to increase rates for commercial property, the sector’s overall value has dropped. According to the commercial real estate services firm Cushman & Wakefield, the overall office vacancy rate for Boston’s central business district in the 4th quarter of 2024 was 18.3 percent—compared with 4.7 percent for the same quarter in 2019. In its outlook, the firm predicted that asking rates would continue to fall in 2025, particularly for Downtown space, but less sharply, with a possible rebound starting in 2026.

Gregory Maynard, the executive director of the Boston Policy Institute, emphasized the state of office property values highlighted in the group’s report early last year and later at a City Council hearing. In an email Monday, he wrote, “Nothing proposed today addresses the enormous impact that falling office values are having on Boston’s budget. The reality is that Boston homeowners’ property taxes are going to rise as office values fall, unless Boston either finds a new source of growth or cuts the budget.”

In its January report, the Boston Municipal Research Bureau observed, “The decline in commercial assessed values and the slowdown in commercial new growth are noteworthy and of concern for FY26 and beyond given Boston’s disproportionate reliance upon business property taxes to fund its budget.” See Page 10 for the Research Bureau’s report.

In their campaign for state approval of a shift in the tax burden, city officials have repeatedly insisted that there was no revenue shortfall, since they would always have the power to increase the tax levy each year by as much as 2½ percent, with no limit on additional revenue from new growth.

But, according to the Research Bureau, Boston’s new growth revenue is down from last year’s record figure by 25.7 percent. As a result, the limit for the tax levy in the current fiscal year is expected to rise by 5.3 percent, instead of the 6.6 percent in the previous year. “The decline in new growth from FY24,” the report explained, “was driven by a substantial decrease in commercial new growth.”