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"The shift to remote work means fewer people are traveling to offices and there's no reason to expect that office work is going to come back, so this shortfall will continue," Horowitz said.

"It's important to emphasize that Boston's current and former leaders are in no way responsible for this coming crisis. What we face is something like an economic act of God," Horowitz wrote. 

“More than one-third of Boston tax revenue comes from commercial property taxes, by far the highest proportion among major U.S. cities,” the report states. “This leaves Boston especially vulnerable to falling real estate values.”

“A tax falloff representing 10 percent of Boston’s total spending is too large to be offset by creative accounting or other kinds of financial management,” the report said. “The city will need to raise new revenue or reduce its medium-term spending plans.

One of the biggest unanswered questions amid Boston’s ongoing recovery from the COVID-19 pandemic is how much slumping commercial real estate values could wallop city finances. A new report out Thursday aims to answer just that.

In a year when tax revenues are projected to grow only a little, the estimated $1.3 billion from the 4 percent surcharge on income over $1 million was the only area of the budget where policymakers could have some fun.

"The state has been flush with cash for a couple years now. We knew it was going to come to an end. The question was when? The answer is now."

After revenues failed to hit benchmarks for six straight months, it was clear “the governor needed to do something like this,” Evan Horowitz told Playbook.

Expenses are piling up on Beacon Hill amid a string of disappointing tax revenue reports. Radio Boston talks with Evan Horowitz of the Center for State Policy Analysis at Tufts University.