Voters in Massachusetts Town Reject Big Property Tax Hike

Voters in a small western Massachusetts town have overwhelmingly denied a major property tax hike that local officials said was needed to close a budget gap and avoid cuts to public services.

South Hadley, home to about 18,000 people, on April 14 rejected two ballot measures described as tax overrides. In Massachusetts, state law generally caps annual increases in property tax revenue at 2.5 percent, unless voters approve a steeper increase through a referendum.

Under a proposed $11 million override, owners of an average home would have seen their property tax bills rise by about 50 percent over five years, according to a fact sheet from South Hadley officials. For a home valued at $417,000, that would have meant an increase of about $1,764 a year, or roughly $147 a month, over that period.

A smaller, $9 million override would have raised property taxes by about 44 percent over four years, adding roughly $1,443 a year to the average homeowner’s tax bill.

According to unofficial results posted by the town clerk’s office, the $9 million override was rejected by a vote of 3,582 to 2,505. The $11 million override failed by an even wider margin, with 3,989 voting against it and 2,085 in favor.

Even with both override proposals defeated, South Hadley homeowners still face an automatic annual increase of up to 2.5 percent that the town can legally impose.

In a recent budget presentation, town officials identified a $3.1 million deficit in fiscal year 2026. That gap, with only $1.4 million funded out of $4.5 needed, was driven by $2.4 million in health insurance costs above the approved budget, $1.7 million for schools to offset lost grants and maintain current service levels, and as much as $400,000 needed to preserve existing town services.

According to the presentation, the shortfall is projected to grow to $6 million by fiscal 2031.

Without a tax override, the town may move forward with planned cuts to schools and other public services. In the school system, that could include about $1.5 million less in spending on sports, after-school activities, and cuts in teaching and administrative positions. On the municipal side, officials have proposed about $1 million in cuts affecting police, the library, parks, public works, and other programs.

The dispute reflects a broader fiscal challenge facing municipalities across the United States, many of which rely heavily on property taxes to fund basic operations. Those budget pressures have intensified as net state aid has declined since the expiration of federal pandemic-era support that once helped shore up local finances, while inflation has continued to drive up costs.

According to a study published earlier this month by analytics company ATTOM, the highest effective property tax rates in 2025 were concentrated in the Northeast and Midwest. Illinois led at 1.84 percent, followed by New Jersey (1.58 percent), Vermont (1.40 percent), Connecticut (1.36 percent), and Ohio (1.32 percent).

Western states had the lowest effective property tax rates in 2025. Hawaii posted the lowest rate at 0.33 percent, followed by Idaho (0.39 percent), Wyoming (0.40 percent), and Arizona (0.43 percent).