Orleans to Consider Quarterly Tax Billing

At this year’s Annual Town Meeting in May there will be a vote to approve a Quarterly Tax Billing system for the Town of Orleans beginning July 1, 2018. This directly impacts the billing and payment schedule of your future Real Estate tax payments. You would now pay your tax in smaller installments but FOUR times a year instead of TWO large installments. 

When will the proposed quarterly billing begin?

Beginning July 1, 2018 for Fiscal 2019.

Why the change to billing four times a year?

Orleans, like most cities and towns in Massachusetts, relies heavily on revenues generated from tax bills to fund its account receivable and payroll warrants. In the current environment the Town operates for almost 4 months (July 1-Nov 1) before collecting its most significant revenue source.  By billing taxes in July at the start of the Fiscal Year it will allow revenues to more evenly meet expenses.

Will the quarterly billing system affect the amount of taxes I pay for the year?

No. The amount you pay is the same under either billing system.  Either way the amount you pay is based on the valuation of your property and the tax rate.

How will I be billed?

The town plans to mail BOTH of the first two tax bills, due August 1 and November 1, in the same mailing (July 1).  The taxpayer would be responsible for paying the August 1 bill and keeping the secondary payment stub in a "safe place" and paying that by November 1.  The same situation would be true for the next two tax bills due February 1 and May 1. In the event a taxpayer loses their payment stub, they can go online to the town website https://www.town.orleans.ma.us/ and print a copy through the “Bill Payment” link, which is where taxpayers can also pay their bills online if they choose.

How will the tax payments be calculated?

The first two payments, known as the "preliminary" bills, will be no greater in total than half the amount billed in the previous year plus 2.5%; less any exemptions, or abatements that were granted in the prior year.  The third and fourth payments, known as the “actual" bills, will reflect any changes in valuation as well as tax rate changes, less the preliminary tax amounts already paid from the first two billings.

The Town has not considered quarterly billing in the past. What has changed?

Recent and continuing reduction in state aid and the requirement of consistent cash flow to fund Capital Project needs causes many towns to rely more heavily on local tax generated revenues to pay its bills. The main purpose of this change is to avoid borrowing costs associated with potential cash shortfalls.  Over 80% of the 351 cities and towns in Massachusetts have changed to and now operate under a quarterly billing system for these reasons.

What happens if my mortgage company escrows my taxes?

In these circumstances you won't even notice the billing change—we will continue to provide tax information and accept payments directly through the escrow companies and tax services.  This will not be interrupted by the quarterly billing change.

How will interest be charged on overdue payments?

Per Commonwealth of Massachusetts statutory requirement, interest accrues at the rate of 14% per year on a per diem basis on delinquent tax amounts, computed from the due dates.  This will remain unchanged and no different from the semi-annual billing policy currently in place, but has the potential to occur four times per year, rather than two, for those who pay late.

Other Questions?

Information sessions will be held at Town Hall in the Skaket Room on March 30 from 2-3 pm and April 25 from 2-3 pm for taxpayers to attend prior to Town Meeting in order to have their questions or concerns answered/addressed.  Please call the Assessor's Office 508-240-73700 ext. 430 for any questions on abatements, exemptions, deferrals or calculation of amount due; OR the Collectors Office 508-240-3700 ext. 314 for other questions on quarterly tax billing.