League of Cities and Towns prepares for legal weed, car tax modification

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The state budget for next fiscal year, which will begin July 1, will likely not be passed for some time yet, however cities and towns in Rhode Island are already sharpening pencils preparing for possible repercussions coming as a result of the proposed language included.

“We’ll be focusing a lot on the governor’s budget,” said Brian Daniels, executive director for the Rhode Island League of Cities and Towns, during a break between sessions at the organization’s 19th annual convention held at the Crowne Plaza on Jan. 24.

First priority issue off the top of his head, Daniels mentioned the proposal to legalize marijuana for recreational purposes, a measure that Governor Gina Raimondo hopes will raise $6.5 million between July 2019-20 and $21.9 million between July 2020-21.

“The marijuana legalization proposal is over 100 pages of legislative text, there’s a lot of impact on cities and towns,” Daniels said. “We’ve done a cursory review. I think we’re going to have some recommendations about more local control and more local input as to how these decisions get made.”

Of particular concern to Daniels and the League is the ability for cities and towns to dictate whether or not they want to allow recreational marijuana facilities in their municipality. The proposal from the state calls for only six new, retail-only “compassion centers” that, combined with the three medical marijuana facilities existing in the state – including one in Warwick – would make for nine overall facilities selling marijuana in Rhode Island.

However, Daniels said that his impression of the proposed legalization legislation gives communities a short time window in order to enact moratoriums if they wish to prevent recreational facilities from opening up in their cities or towns.

“The communities essentially have to make their decisions by November of 2019,” he said. “My reading is that is their one shot at doing it and it’s not an election year, so people would have to pay for a special election. That’s going to be a challenge.”

Still, Daniels said that he was thankful the proposal enables communities to prevent facilities from operating within their boundaries if they choose to do so, despite the accelerated timeline making it more difficult than would be ideal.

“That’s something we care about and it’s something Massachusetts has done, to make sure communities have the ability to choose what goes on in their communities,” Daniels said. “We’re going to have to work out the details with the legislature as this proceeds.”

Elsewhere in the budget, Daniels and the League expressed disappointment at the loss of about $5.3 million in PILOT money from the state. The state payments went to compensate municipalities for property tax dollars that go uncollected from businesses operating within the properties of nonprofit entities such as universities and nonprofit hospitals.

Daniels agreed that the state wasn’t overly clear in terms of how they came up with the figure deemed appropriate to cut, and pondered if communities would be able to recoup money lost even if a legislative measure is enacted to allow municipalities to tax these ventures – which is what the budget proposal calls for.

“They’re trying to figure out what are these properties,” Daniels said. “It’s not as if all of these colleges and universities and hospitals are going to hand out a list of their for-profit properties. So, assessors have to get involved, they have to go find out what those are and figure out if there is an existing tax agreement. Some institutions do voluntary PILOT payments. That’s also a pretty heavy lift for cities and towns.”

Providence and Cranston will be hit hardest by the loss of PILOT funding (around $4.1 million and $630,000 respectively), but Warwick will also lose about $170,000 in revenue from the state that will have to be found elsewhere, as it isn’t known at this time how many so-called “non-mission”, for-profit businesses are operating without paying property tax in the city.

“We have no idea if the amount that can be raised locally offsets the projected cuts the governor has proposed,” Daniels said. “That’s something we’re still determining and that’s going to take some time, because our communities don’t have a list.”

In regards to education, Daniels was happy to see $30 million being added to the funding formula for school aid, but was unsure about how much of that would be going to local public schools versus charter schools. He said that recently released RICAS scores highlighted a need for further investment into education in the state.

“That is a huge driver for our communities,” he said. “Property taxes and property values are tied to how good a school is. People will pay more to be in a good school district, so we need to make sure that we’re providing the best possible education and people are getting the best value for their property tax dollars.”

Also in the proposal was a $290,000 investment to prevent childhood hunger, which included a provision that would mandate school districts to provide free breakfast and serve federally subsidized meals to eligible students.

“Some communities are not doing that now and there will be additional costs,” Daniels said, who said he had been on a conference call with community leaders discussing the issue. He said there would be a waiver provision in the budget that could allow communities displaying a financial hardship to forego the requirement.

Finally, the car tax proponent of the budget – which would recalibrate how the state pays down the balance necessary for the phase out – was also on the League’s radar as well. The budget proposal calls for a smaller pay-down on the phase out in the next fiscal year, resulting in over $21 million in savings for the state now, but also resulting in lower levels of relief for some taxpayers and a higher burden on the state in later years.

Daniels was concerned that, if the legislature approves the funding change to the car tax phase out, depending on when that change is made it could potentially cause confusion or disruption for communities as they send bills out in May, June or July.

“That’s something where we’ll be reaching out to the general assembly and the speaker and the house and senate finance committees and asking for clarity sooner rather than later,” Daniels said. “We do not want to have a situation like we had two years ago.”

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richard corrente

More taxes (marijuana) and less reductions of spending (slowing the car tax phaseout) makes this a tax-and-spent budget. I'm against it. Daniels says he doesn't want the same situation we had two years ago. This looks like it will happen.

Happy Valentines everyone. Go Patriots!

Rick Corrente

The Taxpayers Mayor

Tuesday, January 29
Thecaptain

Geez,

Who was it that predicted that the bogus car tax reform bill put forth by Mattiello WOULD NOT WORK?

Who was it that questioned why Mattiello never showed up to testify on behalf of his own bill?

Who was it that predicted that bu the second year the car tax reform bill would be in jeopardy of failing due to lack of funding and increase need for hand outs for other entitlement programs?

Rob Cote - that's who. Right again !

Tuesday, January 29
wrkvoter

Looks like the fake (and crazy) old "mayor" and the real and very very sane watchdog, almost aligned enough to get back on a boat together! lol

also, "they're phasing out the car tax? what are they smoking!"

ok, seriously, not that I like ANY tax on a vehicle that I already paid 7% sales tax on...but where is a car tax that works, that is fair, and that is not so regressive? hmmmmm? MASSACHUSETTS! Flat rate, phases out on every car in five years (rapid reduction each year). Every town same rate.

Tuesday, January 29
Thecaptain

By the way, what most people dont realize is that they snuck in a change in the depreciation of the car tax that cost you money.

In the past, for the first 3 years you paid tax based on full clean retail. In the 4th year it went to 95%, then to 90% then to 85% etc....

In 2018 the law indicated that in that year all cars depreciation began at 95%. So if your car was already taxed based upon a book value of depreciation of 75%, that depreciation was increased to 95.

Time for people to read the laws.

PS - im not getting on any boat with the fake mayor !!!LOL

Wednesday, January 30
richard corrente

Dear Readers,

wrkvoter's idea of copying the Mass. car tax is a good one but R.I. already has gone down a different path. I commend Mattiello for all the effort he and others have put in to reduce the tax and I hope he and others will finally eliminate it. It is the worst, most unfair tax I have ever studied.

Happy Valentines everyone.

Go Patriots!!!

Rick Corrente

The Taxpayers Mayor

Wednesday, January 30
Thecaptain

YOU HAVE STUDIED NOTHING !!

Wednesday, January 30
richard corrente

Dear Thecaptain, (AKA Rob Cote)

Really? I've "studied nothing"?

Don't you remember me speaking many times at the City Council meetings about the car tax?

Don't you remember me doing the exact same thing at the state house (we even car pooled!)

Don't you remember my many articles and campaign statements about the issue?

Don't you remember …… anything?

How can I campaign for years about an issue if I have "STUDIED NOTHING"? It's not possible. Is it.

What I can't understand is why you have never had either arm in a sling. You must have caused some damage from so aggressively attempting to pat yourself on the back over and over and OVER!.

Captain Crunch.

Happy Valentines everyone.

Rick Corrente

The Taxpayers Mayor

GO PATRIOTS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Thursday, January 31
Thecaptain

Funny stuff.

You did not speak about the car tax at city council meetings. You did speak once at the state house which was completely humiliating because you openly called the general assembly "THE MAFIA", at which point the chairman stopped you from speaking. You never attended a vehicle value commission meeting, you never testified before the senate finance committee, and you never showed up to support or condemn the Mattiello bill. So when you say "you studied it", what exactly does that mean.

That see exactly how much you studied. Here's a couple simple questions:

When the exemption was reduced to $500 in Warwick, how many more cars were added to the tax roles?

How many cars are on the tax roles in Wawick?

What is the annual automobile tax revenue in Wawick?

Thursday, January 31