Communities across Hampshire County are asking voters to approve property tax overrides at levels not seen since the Great Recession as municipal costs outpace revenue growth, renewing debate over the 44-year-old tax-limiting law known as Proposition 2½.

Residents in nearly half of the county’s 19 communities have been asked in the past year to raise their own property taxes to keep local government running, a trend local leaders say reflects growing financial pressures that are unlikely to ease anytime soon.

“These overrides are band-aids as costs continue to rise and revenues do not,” said state Rep. Lindsay Sabadosa, D-Northampton.

Five Hampshire County communities — Easthampton, Hadley, South Hadley, Southampton and Westhampton — have presented overrides this spring in advance of fiscal year 2027, along with Deerfield and Sunderland in Franklin County. Belchertown, Hadley, Hatfield, Southampton and Worthington all floated at least one last year as well.

Meanwhile, the prospect of overrides loom in other communities in the coming years, including in Northampton, where officials say the city will likely propose an override next year.

The trend is not exclusive to western Massachusetts. Statewide, there have been a total of 74 overrides requested this fiscal year, the most since 2009 when 141 override questions were proposed during the Great Recession. There was a sharp drop to 61 override requests in 2010, tailed by a slow decline year-over-year to a low of 20 in 2018 — the least amount requested over the past two decades.

However, override requests rose to 62 in 2024, and have hovered around that number since, according to data from the state Division of Local Services (DLS), which relies on municipalities reporting override requests. Some communities propose multiple override requests in a year.

Legislators and municipal officials say a combination of rising costs has contributed to what they describe as a structural deficit facing communities across Massachusetts. Health insurance, education and special education expenses, energy costs, road maintenance and contractual obligations to employees have all increased faster than local revenues. Overrides aim to temporarily alleviate short-term pain for cities and towns, and when they fail, cuts to municipal services and jobs follow.

“There’s a perfect storm of factors that have led to a lot of these overrides,” Sabadosa said.  “Primarily a lot of rapidly increasing costs for a lot of things, but particularly healthcare.”

“We’re reaching a fracturing point right now,” said state Sen. Jo Comerford, D-Northampton. “Whether it’s healthcare, energy, transportation, the cost of road repairs — these things are really making municipal budgets impossible.”

Those pressures are colliding with the limits imposed by Proposition 2½, the voter-approved law that caps annual growth in local property tax levies and has become the focus of renewed debate on Beacon Hill and in town halls across the state.

The Gazette reached out to local mayors, community leaders and state legislators, asking how to balance the financial needs of residents with those of the communities they live in and what changes are needed to do so. Responses varied, though many local leaders called for increased state and federal aid and changes to Proposition 2½.

Amherst Town Manager Paul Bockelman said Proposition 2½ poses challenges for cities and towns across the state. “It’s a poorly designed, blunt tool to cap property taxes that were rising too fast for people.”

Legislators say they hear those concerns and are working on solutions, while also pointing to declining federal support. Their message was clear: addressing the challenges facing municipalities and residents will require action at every level of government.

“The job of government is to respond,” Comerford said. “I want them [constituents] to know things are changing.”

Proposition 2½ was approved by voters in 1980 and implemented in 1982 amid concerns over rapidly rising property taxes. The law limits annual growth in a community’s property tax levy to 2.5%, although voters may approve overrides to exceed that limit. Overrides can be used to fund the general government, in which case they are permanently added to a communities tax levy, or they can be for debt exclusions and capital overrides that are temporary increases used for specific projects.

The Massachusetts Municipal Association (MMA), a nonpartisan group of policy experts supporting Massachusetts’ 351 communities since 1979, has been examining the law. Executive Director Adam Chapdelaine said Proposition 2½ works in many ways, but there is room to explore changes.

“There’s a lot about Prop. 2½ that is really good and that’s where we’ve been pretty clear. We are not at all advocating for a repeal,” Chapdelaine said. “What we want to argue is that exploring flexibility for local officials within the constructs of Prop. 2½ is probably an appropriate thing to do.”

He said that even “the most staunch advocates” for the measure will say that the 2.5% limit is an “arbitrary figure,” picked without certainty more than 40 years ago. A potential change that is currently being discussed on Beacon Hill, Chapdelaine said, is to increase the 2.5% limit to 3.5%.

“If you look at the math of it, many communities, especially communities out in the western part of the state, there just really isn’t the property value or the median household income to support a higher level of property taxation,” Chapdelaine said.

“There’s no silver bullet. In the next ten years, we’re going to have some difficult conversations about what it means and costs to live in a community.”

Easthampton Mayor Salem Derby said he would like to see the 2.5% tax levy limit be adjustable to the rate of inflation. “Having a tax levy that is adjustable to the rate of inflation is the most critical piece. Being capped at 2.5% is getting cities in this problem area.”

Chapdelaine, who has experience as a former town manager of Arlington, said overrides divide residents in certain communities, and are often politicized. With that, Chapdelaine said the MMA sees mayors, town managers and select boards “looking at the demographics of their community,” and making a decision based on if they think an override is plausible.

Northampton Mayor Gina-Louise Sciarra said the city she leads has had success by starting a long-term strategy in 2014, implementing overrides periodically. She added that the law was enacted with the intention that overrides would have to be requested by communities.

“Since we’ve been using that plan, we’ve been able to have sort of steady responsible increases for services and also be able to maintain services with some growth,” Sciarra said.

Supporters of Proposition 2½ argue that the law balances the needs of residents and their communities by giving voters a say in tax increases while still allowing municipalities to raise their tax levies each year. State Sen. John Velis, D-Westfield, said the law remains important because every community faces different circumstances.

“Many [overrides] pass, many don’t, but I think that is a decision that is best left to the people,” he said. “Every community’s fiscal conundrum is different.”

Similarly, state Rep. Homar Gómez, D-Easthampton, said he is a fan of Proposition 2½ because not only does it give residents a chance to voice their opinion, but it also opens an avenue for them to get involved in local government.

“The community has the opportunity to weigh in,” Gómez said. “The community has a better opportunity to see how the budget is working and have a better understanding of what the financial situation is within the municipality.”

The “perfect storm” is nothing new to Chapdelaine and the MMA, which released a report titled, “A Perfect Storm: Cities and Towns Face Historic Fiscal Pressures,” detailing current financial cost drivers. Soon after, it released a series of solutions in another report titled, “Navigating the Storm: Charting a Course Toward Fiscal Stability.”

Between 2010 and 2022, inflation-adjusted spending for Massachusetts municipalities grew by 0.6% annually, slower than the U.S. average for local spending growth and the growth in the Massachusetts state budget, the first report says.

The report found that almost 200 of the 351 cities and towns in Massachusetts have not pursued an override in the last 15 years, and communities that did have been “overwhelmingly” in suburban towns.

While property taxes are communities’ largest source of local revenue, the top funding sources from the state are Unrestricted General Government Aid (UGGA) and Chapter 70 school aid, the report says. Since 2002, when adjusted for inflation, unrestricted local aid has fallen 25% overall.

In separate interviews, Comerford and Velis said the Senate is taking a closer look at UGGA and Chapter 70 education funding. The Senate’s fiscal 2027 budget includes a $53 million increase in UGGA and would create commissions to review the funding formulas for both programs, which Comerford described as “unworkable” and “broken.”

“I have been a long proponent of increasing all forms of local aid,” Velis said. “The way that the system is set up for schools, roads and UGGA, we should always be having conversations about increasing those.”

But South Hadley Town Administrator Lisa Wong said formulas alone will not solve the problem.

“What’s kind of an issue is you can change the formulas all you want but if the pool (state budget) is not growing, then it’s really about saying, ‘how are we contributing to making the state economy better?'” Wong said. “Is it individual towns doing individual things? Is there something more cohesive that can happen?”

Velis similarly said that the work needs to be done together. “We need to get into a room and talk about how we can do things better,” between local, state and federal entities, he said.

Chapdelaine said that Chapter 90, which provides funding for local road repairs, has been eyed for a change that would make its formula based on the distance that roads cover in a community, calling it “a really big equity component, especially for rural and western communities.”

Besides changes to Chapter 70 funding for education, Wong said she would like to see more equity for how public schools are reimbursed from the state for charter school placements, which she said often receive more funding.

“We would love to see full charter school reimbursement, because there are legitimate cases that seem like charter schools are getting more and they’re having disproportionately less issues,” Wong said.

Derby said that he would like the state to increase local tax options, to provide another avenue for communities to bring in funds. He added that special education costs was a driver that led to Easthampton’s deficit this year.

While there are many changes that can happen and progress that needs to be made, Sabadosa said there is not one answer. She said the price of services is going to continue to increase and eventually communities will have to talk about how they are going to keep paying for them. For some communities that could mean regionalization with others to maintain services.

“There’s a point where you regionalize to an extent where you’re not your own community,” Sabadosa said. “We need to decide what the future of Massachusetts looks like.”

She admits that there’s “no silver bullet. In the next 10 years, we’re going to have some difficult conversations about what it means and costs to live in a community.”

Material from State House News and the Massachusetts Municipal Association was used in this article. Staff Writers Anthony Cammalleri, Emilee Klein and Scott Merzbach contributed to this article.