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Senate FinCom OKs $2.5M supplemental tax levy

May 7, 2013

PROVIDENCE – The Senate Finance Committee unanimously approved Sen. Marc Cote’s bill to approve a $2.5 million supplemental property tax levy in Woonsocket on Tuesday.
The measure will now go to the full Senate, but Cote said if it is approved there, it will be held until other parts of the plan to reduce Woonsocket’s deficit plan are concluded. These include negotiations that Mayor Leo Fontaine and Budget Commission Chairman William Sequino are currently conducting with city employees and retirees to cut payroll and pension costs.
At the same hearing, Woonsocket officials also made a pitch to extend tax exempt status to the Stadium Theatre. That bill, also sponsored by Cote, was held for further study by the committee.
Cote told The Call that the idea of passing the bill in the Senate now will send a signal that the General Assembly and the taxpayers stand ready to be part of the overall solution to Woonsocket’s budget problems.
“There are other parties of interest that have contributions to make,” Cote told the committee.
“We have to get this issue behind us because right now the city of Woonsocket is basically paralyzed by the uncertainty, economically, of what is coming down the road with respect to taxation and the whole financial structure of our city,” the 10-term Democrat said. “I think it is in everyone’s best interest to contribute to come up with a solution to this problem sooner rather than later.”
Schools Supt. Giovanna Donoyan told the panel she was asking for the committee’s support for the bill on behalf of 6,000 children in Woonsocket who are at risk for their teachers not being paid (and the school department’s) vendors not being paid.
“I need to keep them in school until June 14th, at least,” Donoyan said.
Although the supplemental tax is moving through the Senate, no companion bill has yet been introduced in the House of Representatives. The city’s House delegation is working on a slightly different version of the bill. The Senate bill would allow city residents to be assessed an extra tax of up to 4.6 percent on residential real estate and 12.7 percent on motor vehicles and trailers. That is the plan that came out of the state budget commission, that would take $2 million property taxes and another $500,000 from vehicles. Representatives say the House version will more likely take $1 million from vehicle taxes and $1.5 million from non-resident owners of single-family homes and condominiums.
Rep. Robert Phillips said Tuesday that the final details of that bill are being worked out and it will likely be introduced sometime this week.
Woonsocket Finance Director Thomas Bruce told reporters after the hearing that he would like to see the supplemental tax bills get through the General Assembly and become law by May 15, that would give the city time to get the tax bills im the mail and give city residents 30 days to make the payments so they can be counted in the current fiscal year.
No matter what, Bruce said, city residents will have 30 days to pay the tax before any interest is charged.
As for the timing of the House bill, Bruce conceded, “it’s slower than we wanted.” But he added that city officials are communicating with the delegation and “we know they are working on it.
Asked about Bruce’s hoped-for May 15 passage date, Phillips said, “it could be close.”
Cote said he sees no incongruity in asking for a supplemental property tax in the city while at the same time asking for the Stadium Theatre to be exempt from property tax.
“There are many entities that do good work for the city and they would not be able to exist if we place additional burdens on them,” the senator said.
Cote told the committee that the Stadium “is a great financial and economic generator for our city.
City Council Chairman John Ward handed the committee a council resolution that passed unanimously supporting the exemption for the theater. He said the state budget commission also backs the bill.
“The Stadium is so important to the downtown area,” Ward said, “we hope this bill will pass.”

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