Question: “Who sets the property tax rate?”

No single person does. It’s actually a mathematical equation in which the tax levy is divided by the total value of taxable property in town.

The first part of the equation – the tax levy – is the amount of money the town needs to raise from property taxes. This is decided upon when voters attending the Annual Town Meeting pass the town’s operating budget and any other warrant article that includes the phrase “raise and appropriate.”

The word “raise” in that phrase means to fund it through property taxes. There also may be “raise and appropriate” articles on the fall Town Meeting warrant. If there are, the tax rate cannot be calculated until after that meeting.

The second half of the equation – the total value of taxable property in town – is calculated each year by the Assessors’ Office, supervised by your elected Board of Assessors and certified by the Massachusetts Department of Revenue (DOR).

Massachusetts laws require assessors to value property at 100% of its “full and fair market value” each year. Contrary to popular belief, assessors do not raise your taxes – per state law, they adjust values upwards or downwards to match market conditions.

Typically, property values are calculated from May through October.

By the beginning of May, businesses have sent us their Forms of List detailing their personal property. By the end of May, the DOR issues its central valuations of pipelines and telecommunications companies. We also have private consultants calculating our electric and gas utility valuations for us by early to mid-June. Together, these give us the total value of personal property in town.

Also by the beginning of May, businesses have sent us their Income and Expense forms for properties used to generate income, such as rental apartments and leased retail, commercial and industrial buildings. This data is used to “model” the gross income, vacancy rates, expenses, and capitalization rates used to value income-producing properties.

By state law, we can measure for “new growth” through June 30th. “New growth” is new homes and commercial or industrial buildings – or additions to them – that have not been taxed before.

At the same time, we are studying sales of all properties – open land and residential, commercial and industrial properties – from prior years to see how market values are changing and how our property values need to be changed across all categories of properties.

We narrow this focus down from the entire town to factors such as the age of buildings, style of buildings, neighborhood locations, building conditions, etc. After the Assessing staff completes this review, your elected Board of Assessors reviews them. Finally, the new assessments are reviewed and approved by the DOR.

The DOR also approves the assessors’ analysis of sales and the individual calculations that add up to the total amount of new growth.

Finally, we get to the annual Tax Classification Hearing, at which the Select Board decides whether to have a single tax rate or a dual rate. With a dual rate, the owners of commercial (including agricultural), industrial and personal property would pay a higher tax rate than residential property owners.

Once that hearing is complete, a form completed by the Town Account, Treasurer/Collector, Town Clerk and Board of Assessors known as the “recap” (for “recapitulation”) sheet is submitted to the DOR, which – by approving this form – “certifies” the property tax rate.

So, who actually “sets” the property tax rate? One half the equation is determined by Holliston voters. The other half is determined by the Assessors’ Office. And, the DOR reviews the numbers and “certifies” the math as correct.