Worcester Business Journal

wbjournal.com | November 3, 2025 | Worcester Business Journal 27 FletcherTilton.com WORCESTER | BOSTON | FRAMINGHAM | CAPE COD | PROVIDENCE Knowing the ins and outs of commercial real estate requires not only know-how but also knowing who. Our knowledge of local and regional markets allows us to assist you with the how and the why, the when and where, always with an eye on the time, regardless of the size of your project. Because when you have all of the right information, you're assured of making an enlightened decision. Regional Real Estate? Our World of Knowledge Can Bridge the Gap Between a Great Idea and a Grand Opening Todd Brodeur 508.459.8038 Mark Donahue 508.8029 Burns Bridge in Shrewsbury, MA. Photo by Jerry Callaghan City of Worcester went to fund Institute Park and the Worcester Public Library. ese PILOT agreements and WPI's nonprofit status became a source of tension last year when WPI purchased two hotels for $46 million in the Gate- way Park section of Worcester, spurring concerns the City would lose about $1.6 million in annual tax revenue. WPI eventually came to a second PILOT agreement with the City, where it would pay the full taxes on the hotels until they are no longer operated as hotels. Members of the Worcester City Council were still upset by the situation and placed a non-binding question on the Nov. 4 election ballot, asking if col- leges and universities should be required to contribute 0.5% of their endowment to a community impact fund. Property taxes are the most consistent source of revenue for municipalities, and the issue of nonprofits not having to pay tax is one that disproportionately impacts Gateway Cities like Worcester, said Tim Murray, president and CEO of the Worcester Regional Chamber of Commerce. "Its not un- reasonable for business and gov- ernment leaders to ask [nonprofits] to keep proper- ties on tax rolls if they acquire new ones," Murray said. "ey benefit from the services the City provides, primarily through the City budget, which is primarily based on property tax." Worcester has plenty of other com- mercial entities that pay taxes, Dunn said. Besides utilities, life sciences and real estate are major contributors. Worcester TC LLC, the owner of the 100 Research Drive property home to pharmaceutical giant AbbVie's Worces- ter office, is the fourth-highest commer- cial taxpayer in the city, at $2.4 million. Worcester benefits from research and development organizations wanting to keep their manufacturing closeby, Dunn said. "We've found that in biomanufactur- ing, they like to have their contract or- ganizations near where R&D is happen- ing," he said. "It's not just based on cost. It's, 'Are you near the workforce that you need and companies doing R&D?' at's what we've been focusing on over the last 10 years in that particular sector." Proposed changes to tax code Worcester's split tax rate, or dual tax rate, implemented in 1984, means there are different tax rates for commercial and residential properties. Commercial, industrial, and personal property taxes made up about 36.5% of the total tax levy in 2023, but assessed values of these properties were only 21% of the total in the city, according to a 2024 report from the Worcester Region- al Research Bureau. e dual tax rate, plus personal prop- erty taxes on things like equipment, are oentimes enough for a business to think twice about Worcester, Murray said. "During the last municipal election, there was a candidate asking 'Why does Shrewsbury have a new Market Basket and not Worcester?' Well, if you take the footprint of that Market Basket and cal- culate what they'd be paying in property taxes, they'd be paying $200,000- $300,000 more a year in Worcester," he said. District 1 city council candidate Keith Linhares has advocated in favor of a land-value tax, which would mean paying taxes based on the value of dirt underneath the building, but not the building itself. is type of taxation, Linhares said, in- centivizes landowners to improve their existing properties because they won't get taxed on building additions. Stephen Hoskins, director of com- munity research and engagement at the New Jersey-based Progress and Poverty Institute, advocates for the land-value tax across the U.S. Doing it in Worcester would require state legislation, he said, and probably some investment in the Keith Linhares, District 1 city council candidate Timothy Murray, CEO of Worcester Regional Chamber of Commerce PHOTO | GRANT WELKER Utility company National Grid is the highest property taxpayer in Worces- ter, contributing $16.7 million in fiscal 2025. assessing department to ensure fairness. But the idea is always for it to be reve- nue-neutral, he said. "In cities in particular, land takes a lot of value, not because of the person who owns it right now, but because of the efforts of the city council, providing things like street sweeping, and a functioning business environment. ose are what give the land its value," Hoskins said. "When government creates the land value, it captures it back in the land tax." e Worcester chamber favors a single tax rate, where taxes are the same whether a property is residential or commercial, Murray said. Communities like Fitchburg have done this, gradually lessening the dual tax rate over a period of time to encour- age economic development while easing residents into the new system, he said. "You can't change this overnight, but a gradual commitment over time sends the right signal to businesses that are here and want to be here," Murray said. "Doing it over a period of time, you're not creating sticker shock for existing homeowners." Stephen Hoskins, from Progress and Poverty Institute W

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