Homeowners in Cambridge, Massachusetts, could see residential property tax rates rise by 10% to 15% even as the city considers cutting services.
Here's what to know
At a joint City Council and School Committee roundtable, administrators outlined plans to cap growth in both the tax levy and budget at 5.5% for fiscal year 2028, according to Cambridge Day.
The proposal anticipates a $57 million increase in the operating budget. Even with that increase, maintaining existing services would leave a $6.7 million deficit.
City Manager Yi-An Huang indicated that job cuts were not expected, and administrators have not identified which services could be reduced. To address the shortfall, Cambridge administrators are seeking $7 million in cuts to current spending.
High interest rates have slowed development while commercial property values continue to decline. Those pressures coincide with rising expenses from employee cost-of-living adjustments and debt payments on capital projects.
If commercial values fall more than expected, scenarios presented by Cambridge's financial team suggest residential tax rate increases could approach 15%.
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More background
Owners of buildings with one to three family units would likely face the greatest increases because those properties have appreciated the most, according to Cambridge Day. By comparison, average condominium assessments have remained more stable.
The impact on homeowners drew attention from Councillor Patty Nolan, co-chair of the Finance Committee. Residential tax rates increased an average of 7% in fiscal year 2027.
"There are thousands of people across the city whose bills went up $1,000 or more," Nolan said.
Referring to the middle class, she continued, "It's all those people in the middle that we know are the most crunched."
Property taxes are also covering a larger share of Cambridge's budget as revenue from service charges, licenses, and permits has grown more slowly than spending.
What's being done?
One potential source of relief is Harvard University's agreement to make payments to Cambridge in lieu of taxes. These voluntary agreements allow tax-exempt universities to contribute financially to their surrounding communities.
Harvard's last agreement with Cambridge provided $6 million when it was signed in March 2025. The city's budget projections assume another agreement for the same amount.
Huang said changes Boston made to some of its agreements looked promising, and he hoped to have a Cambridge agreement ready. Harvard's endowment reached $68 billion after a 27% investment return, Cambridge Day reported.
Cambridge also plans to draw on free cash reserves, in part to cover an extra 53rd employee paycheck caused by the 2027 calendar.
Those reserves, however, have fallen 20% over two years. Claire Spinner, who oversees fiscal affairs as an assistant city manager, cautioned against relying on that money to cover recurring expenses.
Councillor E. Denise Simmons called on administrators to help homeowners anticipate the financial strain rather than surprise them with higher bills.
"No matter [what], bad news is bad news is bad news. It's not going to get better," she said, according to Cambridge Day, adding that if residents aren't told ahead of time, "it makes people feel worse."
Where can I learn more?
These other Massachusetts communities are grappling with higher property taxes and tight budgets, too.
• In Adams, Massachusetts, homeowners are set to pay about $130 more in property taxes.
• Boston homeowners questioning their property tax bills can press city officials about assessments.
• Springfield, Massachusetts, opened a $1 million property-tax relief fund for seniors and disabled homeowners.
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