GloucesterTimes.com, Gloucester, MA

October 10, 2013

Letter: Rockporters wrongly subsidizing Long Beach


Gloucester Daily Times

---- — To the editor:

When you pay your real estate taxes in Rockport, your home is a cash cow to the tune of $500 per year.

That’s $5,000 over 10 years given to the 154 cottage owners at Long Beach.

How can this inequity be happening? It’s quite simple. Rockport residents own the land under the vacation homes at Long Beach, but the rent paid to the town is one-tenth of the fair market value.

It may seem incredible, but the remaining 3,500 homeowners in town over the 10-year lease, will pay a subsidy of $17,500,000 to vacation home owners at Long Beach. Do the math: $500 per home x 3,500 homes x 10 years.

In the name of fairness, the selectmen need to vote rents that make this more equitable.

The Selectmen are in the process of correcting this inequity. The cottage owners at Long Beach have the selectmen’s ear because they have not been contacted by the community as a whole. If they do not hear from you, they will presume that you are happy with the subsidy and extra taxes you pay.

Long Beach cottage owners are exercising their democratic right, e-mailing and otherwise advising the Selectmen to keep their rents low. If you care about this issue, let the Selectmen know today at selectmen@townofrockport.com or by letter to Town Hall.

I have several equitable suggestions.

Remember, Rockport citizens own the land which is leased to cottage owners. The current rent is 0.5 percent of the assessed land value, which is $60 million dollars. Accepted market value rental payments are 5 percent of the assessed land value.

This market rate is for tenants who are also paying real estate tax. Raising the rents to 3.5 % of market value may be a good compromise. This would reduce the subsidy to $150 per home per year, which might be more acceptable. The new rent could be phased in over a five-year period beginning with an immediate raise to 11/2 percent of the assessed value, and adding 1/2 percent more in each of the ensuing 4 years.

There is no need to wait for a professional appraisal. Changes can be included in the new leases beginning January 1, 2014, and adjusted up or down, when the new rent appraisal is done.

In the future, the new rents should be adjusted based on the usual three-year town re-assessments. This would be fair to all and keep the rents closer to full market value. Since connection to the Gloucester sewer system, the cottages can now be lived in year round. Thus the Town could offer year-round occupancy if the tenants wanted it. There is plenty of room in the school system to absorb new students at minimal cost.

It is imperative that residents contact the Selectmen immediately to let them know your thoughts. If you think the rents should be raised to 3.5 percent of the assessed value within the next 5 years beginning Jan., 2014, they need to know that.

If not, tell them. Failure to contact the selectmen could cost you thousands and the town millions of dollars over the life of the 10-year Long Beach lease.

MEL MICHAELS

Rockport