What is Proposition 2 1/2?

Proposition 2½ is a Massachusetts law that limits the dollar amount by which a community can increase its property taxes each year. The limitation is 2.5% over the prior year's tax limit, plus an amount for "new growth" - a figure provided by the Board of Assessors, based on actual new construction.

Towns can raise taxes above Proposition 2½ level by passing a General Override, which permanently increases the levy limit, or a Debt Exclusion, which exempts a specific long-term debt issue from the limit, but ends when that debt is paid off.