Kraft calls allegations Boston over-taxed office buildings ‘serious and credible’

Local News

The Wu administration was accused of purposefully over-valuing buildings to collect more tax revenue.

Mayoral candidate Josh Kraft amplified claims this week that Boston Mayor Michelle Wu’s administration has artificially inflated commercial property values and punished owners who have applied for tax abatements.

“While I can’t speak to the accuracy of these allegations, they are serious and credible. And they demand an answer,” Kraft said at an event Thursday. “If the evidence is wrong, she needs to prove it. A wholesale dismissal—which has been her standard response—is unacceptable. Because right today it looks like the Mayor is using her office to punish property owners for exercising their rights under the law.”

The allegations were made by a group of legal experts with the Pioneer New England Legal Foundation, according to Kraft’s campaign. 

Boston’s Real Estate Bar Association hosted a webinar Thursday where PNLF’s president, retired judge Frank Bailey, and attorney Ryan Swift outlined the claims. They said that Boston purposefully over-valued 39 buildings by $545 million in the last two years. This purportedly generated more than $13.3 million in property tax payments, The Boston Globe reported. 

PNLF first made these claims in June, but only recently provided specifics. Some of the properties that were allegedly over-taxed include major office towers downtown like 125 High St., One Federal St., and 60 State St., per the Globe. 

“If these cases go to court and the City is forced to refund hundreds of millions of dollars in overpaid taxes, it will be a massive blow to Boston’s finances,” Kraft said. 

The state’s revenue commissioner has told PNLF multiple times that it is “unable to substantiate” their claims, according to the Globe. 

Boston relies heavily on property taxes, as about 70% of the city’s budget is funded by them. When the pandemic caused commercial property values to fall, residential real estate values rose and homeowners stood to see a sharp spike in their property taxes to make up for the difference. 

Wu spent much of last year attempting to gin up support for a plan that she said would soften the blow on residential property owners by shifting the city’s property tax burden onto commercial real estate. That proposal ultimately died in the Senate, but Wu filed a new version earlier this year.  

Kraft said Thursday that he would like to see the city create more revenue sources and create a more “fiscally disciplined” budget. 

“I would never increase residential taxes without first finding significant savings in the city budget,” he said, according to The Boston Herald. 

The Wu campaign fired back in a lengthy statement, which was posted online by MASSterList editor Gintautas Dumcius. 

“Kraft made clear that he is opposing the property tax relief for residents and small business owners that Mayor Wu is fighting for as a balanced response to post-pandemic shifts in commercial real estate values,” the Wu campaign said. “Maybe he’s been slow to understand the issue because he has never had to worry about how to afford rent or housing costs.”