Proposition 2 1⁄2 is a Massachusetts law enacted in 1980 that limits the amount of property tax revenue a municipality can raise through taxes from year to year. Proposition 2 1⁄2 caps the tax levy at a 2.5% increase per year based on the value of all taxable commercial and residential property in the Town. A community can permanently increase the levy limit through overrides with a majority vote by ballot. Learn more about the Proposition 2½ and Tax Rate Process here or in this short video.

The override will be included on the state election ballot, Question #10. The election will be held on Tuesday, November 3, 2026. All Precincts vote at the Reading Memorial High School Field House from 7:00 AM to 8:00 PM.

Free cash is part of the Town's financial reserves; it is unrestricted revenue from the previous fiscal year generated from actual revenue collections that exceed budget estimates, interest income, and when departmental expenditure comes in under budget.  In Reading, we have historically used a portion of our free cash reserve in the operating budget. Over the last 3 years, free cash use has exceeded free cash regeneration. Prior to that, in most years, free cash regeneration outpaced free cash use. The FY27 budget is using $6.475M in free cash to balance the budget, which is not sustainable for FY28 and beyond.

Due to rising costs, inflationary pressures, and insufficient local aid from the state level, Reading has increasingly had to rely on free cash over the past several years to balance the operating budget. The FY27 budget is using $6.475M in free cash to balance the budget, which is not sustainable for FY28 and beyond. Accommodated costs have gone up by $9.8 million more than if they had only gone up by 2.5% per year. Despite that, the town is still only asking for $6.5 million to balance the budget because of cuts and cost savings elsewhere.

Using the FY26 average single family assessed value of $944,193, an override of $6.5 million would cost the average tax payers $736.47.

The Town of Reading has updated its tax calculator for residents to plug in their assessed value and see an estimate of the tax impacts for their individual property. Please see the tax calculator here: https://taxcalculator.readingma.gov/.

Reading's last operational override was in 2018, and it was for $4,150,000. This override was expected to last for 3-5 years without having to come back to the voters with another operational override. Reading was able to make it last almost 9 years due to strong reserves and temporary pandemic-related funding through the CARES Act and ARPA, as well as thoughtful departmental budgeting.

An operational override results in a permanent tax increase that is used to fund recurring operational expenses (such as this ballot question in November). A debt exclusion override is a temporary increase in property tax to pay for debt service on capital projects. For example, the Killam School Project is borrowed for 20 years, and the Reading Center for Active Living is borrowed for 15 years. These are the only debt exclusion capital projects currently held by the Town of Reading and are already reflected in your FY27 taxes.

No, the RMHS renovation and Wood End Elementary debt came off in FY25, and the library renovation debt came off in FY26. In FY27, which began July 1, 2026, the first borrowing of Killam Elementary and ReCAL, the senior/community center, is in our taxes. If the override passes, it will go into effect in FY28 which begins July 1, 2027.

Yes. Over the long term, increasing the commercial and residential tax base through thoughtful development is one of the tools available to Reading to ease the impact of rising costs.

The Town has used free cash and stabilization funds to help balance budgets, but that is not a sustainable long-term strategy.

Going forward, the Town will continue to work to identify cost pressures earlier, consider policies around the use of free cash, and focus on revenue growth. Some costs are outside the Town's control, making long-term planning and early identification of financial pressures especially important but also difficult.

Among its immediate neighbors, Reading features the second-lowest residential tax rate. Homeowners in Reading face a lower tax percentage on their property value than those in Lynnfield, Wilmington, Wakefield, and North Reading. (source)

If you are 65 or older and own or rent your principal residence in Massachusetts, you may qualify for the Massachusetts Senior Circuit Breaker Tax Credit. For tax year 2025, the maximum state credit is $2,820. This is a refundable tax credit, which means that if your credit is greater than the Massachusetts income tax you owe, the difference can be refunded to you.

Details on other potential exclusions can be found here:

• Massachusetts Veterans Services

• Massachusetts Commission for the Blind

Find extensive information on exemptions and tax relief on the town website here.

NO override tax increase would mean (among other impacts):

• 60+ Full time equivalent (FTE) positions across Town and Schools are at risk

• Risk downgrading AAA Bond Rating

• Continued financial strain with higher interest rates for debt borrowing 

• Significant cuts and service level impacts to all departments

• Risk of losing services that led to student academic success 

• Risk of impacting student programming & services

Specifically:

• Community Services: Cut EHS programming to $13k; Cut Therapeutic Rec Instructor

• DPW: Cut Parks Improvements, remove trash bins from parks and fields

• Facilities: Eliminate 1 new maintenance staff position and 1 custodian for new buildings

• Fire: Delay purchase of planned new ambulance (Reading currently only has 1 ambulance)

• Health: Cut Rodent Mitigation to $30k

• Library: Cut Sunday hours 

• Police: Cut overtime, defer replacement of unmarked cruiser(s) as previously scheduled in the capital plan, and cut Crossing Guards

• Schools:

  • Cut $917k Community Priority

  • Loss of 15 educators, 20 paraprofessionals and 7 nonunion positions

  • Impacts on Athletics and Extracurricular Activities funding

  • Return of Full Day Kindergarten tuition

  • Staffing reductions and larger class sizes

• Technology: Cut Microsoft licenses, cut IT support for night meetings