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Pawtucket council OKs budget, 8% tax increase

11:40 PM Wed, Jun 10, 2009 |
Mike McKinney    Email


PAWTUCKET, R.I. -- The City Council gave unanimous preliminary approval Wednesday night to a budget that would impose about an 8-percent tax increase next fiscal year in order to close a school budget deficit in the current year, which runs through June 30.

The council cut a proposal to require residents to pay for bags for non-recyclable garbage after members of the public expressed strong opposition at Wednesday's hearing. The bag system had been promoted as a way to reduce next year's tax rate increase to 5.6 percent, by reducing the city's tipping fees, but resident after resident said the mandated fees -- $2 per bag -- amounted to another tax hike in disguise.

Some residents said they can barely pay for food and housing, argued that enforcement of the bag program by a part-time officer would surely fail, and complained that it was sprung on the public at the last minute, might not meet the revenue projections and needed study. The bag-fee system was slated to go into effect in the fall.

Resident Joseph M. Lima called the bag-fee plan "a back-door increase in taxes."

"With the economy the way it is, we cannot afford this," resident Barbara Lagerstrom told the council.

The current tax rate of $16.13 per $1,000 of assessed value would rise to $17.78, under the amended budget of about $203 million for schools and city services. On an average home assessed at$171,000, the tax bill would rise about $282, according to Ronald Wunschel, the city finance director.

Local tax levy increases in fiscal 2010 are capped at 4.75 percent by state law, but the state Division of Municipal Finance granted Pawtucket an exemption to raise taxes higher because the city has endured a large drop in state revenue-sharing aid, division chief Peder Schaefer said this week. The state cut the city's aid by $2.6 million, more than 50 percent, Wunschel said.

The nine-member council must take a second vote to approve the budget, sometime next week, assuming that it does not amend the plan following a public hearing that will be held the night of the vote. The hearing will focus on the amendment that removed the bag proposal.

Along with a tax increase next year, the proposed budget draws heavily from "rainy day" cash reserves to seal up this year's holes. The tax increase would cover $3 million of a $5.1-million schools deficit in this year's budget. The reserve fund is tapped to cover both the balance of that deficit and the entire $2.6-million non-schools deficit, Wunschel said. He has said that many areas of the budget did not increase from this year's levels or were reduced.

The council's budget plan aims to avert a Caruolo action filed in Superior Court by the School Committee from going forward. The suit, filed in April against the mayor and City Council, aims to get a court to order a $5.63-million increase in the school budget for this fiscal year. That would cover the $5.13-million deficit and an anticipated $500,000 in legal expenses tied to the action.

Wednesday night, Council President Henry S. Kinch Jr. blamed state officials for taking aid away from communities late in the game and essentially dumping a tax burden onto local taxpayers. He also criticized school district officials for not better grappling with a deficit.

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Comments

Joe B said:

Of course Kinch would blame someone other then himself for this tax increase. Cuts were proposed during the last budget and they were laughed at. City government has been partying at our exopense and now the bill needs to be paid. Who gets stuck with it.....us! Doyle and Kinch....it's time for you to go! Let someone willing to get the job done do the job.



Pawtcket Resident said:

Who did Doyle think was going to cover the salaries of city workers that was hired as his administration waits for money to be funneled down form state goverment? He should have been trying to reduce the workforce of the city instead of increasing the payroll. If he was running a business like this, he would be bankrupt!

How did Doyle get re-elected a mere 7 months ago?



John S said:

I pushed hard to have the PAYT idea removed from the budget. It's a good idea, but one that needs evaluation before a quick implementation.

It did appear to me that the PAYT idea was a way for the Council to say to their constituents that we cut the tax rate. The problem was that the PAYT bags would actually cost a taxpayer more, at least by my calculations.

There is some validity to Kinch's statements about the State pushing their own problems down to the cities and towns. Of course, the cities and towns are now doing the same and simply pushing the cost down further in the food chain -- to the taxpayer.

In these tough economic times, reviewing this detailed budget in only a few weeks lends itself to not finding viable solutions. When faced with a deadline the only solution is raise the tax revenue to match the expected budget, rather than trimming that budget.



mp775 said:

I don't see any reason to complain about this. Sure, the tax _rate_ is increasing, but our houses were just revalued. My assessed value went down 22 percent from last year. With this tax "increase," my taxes are actually going be about 14 percent _less_ than they were last year.



John S said:

mp775, I think you need to look again. The actual rate for this past year was $12.39. That has been adjusted for the 24.5 percent devaluation the city took this year. That's where the original article reference $16.13 (I actually think it's $16.41). So, what you paid this year was $12.39. What you are going to pay next year is not 8% above the $12.39, but rather 8% above the $16.13 or $16.41. That's how they get to the $17.78 amount.

An example would be:
2009 value $100,000. Your tax would have been $1,239 (100 x 12.39).
2010 value is $78,000 (decrease of 22%). Your tax will be $1,386 (78 x 17.78). That's a bit over a 10% increase for a home that decreased in value by 22%

Bottom line is that if your home decreased by 22% you're probably going to see more like a 10% increase in your real estate tax.



mary conlon said:

The rate for last year(2008) also known as the CURRENT RATE is $12.39 per thousand, no matter how you look at it. The rate of $16.13 was never established yet.
THEREFORE THE RATE OF INCREASE TO THE RESIDENTIAL RATE IS OVER 40% AT $17.78. The Council claim the increase is only $1.65; HOWEVER, the increase is $5.39 per thousand. The trash bag never came into play yet - the 8% only makes them look like they really tried.



40% tax increase is absurd said:

The unions have got to back down. It is ridiculous to ask the taxpayers to foot a 40% tax increase just to pay usurious union wages and benefits.

How about splitting it down the middle: unions take a 20% tax cut, taxpayers eat a 20% tax increase.



Queenb said:

I think Doyle and Kinch need to vacate office as well. It's time for a change. Don Grebien is running against Doyle, that's what I hear. Help get the word out "It's time for new blood, new ideas and to move forward." Let's hear Grebien out and give him a chance, we the people can't afford Doyle, Kinch and others like them anymore.



HadEnough said:

My tax bill went from $3650 (2008) to $4716 for the upcoming 2009-2010 FY. That amounts to a 22.5% increase! which is far above all the estimates bandied about by politicians and others. Yet, my home evaluation went down as my land eval went up. I think Pawtucket will see lines out the door of the Tax Assessor's dept appealing these unaccepatable increases.
It is not acceptable.



mary c. said:

My taxes went from $3550 to $5024 resulting in an increase of 29% slightly different than the 8.2% they lied about.
YOU HAVENT HEARD THE BEST PART - ALL YOU SENIORS, VETERANS, DISABLED, ETCCCC...........
Look at the back of your bill and see where all the exemptions were decreased considerably - example, seniors will not get $47,000 off valuation but only 35,400 therefore resulting in a TAX INCREASE OF $206.00; this is double taxation, it was done in secret. Pawtucket taxpayers were deceived big time.



Jonathan Walsh said:

You think you have it bad, my house was reassessed at less than 10% lower than previous assessment, and my taxes went up $1800.
That's 43%!!

This is ridiculous. What about the elderly, just getting by on social security? With even less senior valuation reduction (See Mary's comment)? Move out? Foreclose?



Alina W. said:

My husband and I made a home purchase decision based on CY 2008 R/E tax rate of $12.39. How exactly did the city of Pawtucket manage to change it from $12.39 to $16.13 or $16.41 to make us feel better about another increase to $17.78 is still a mystery to us since as taxpayers meeting our R/E tax liability through a bank we do not get a courtesy copy of our tax bill. We do not even get a copy of it upon written request! My mom does not have a mortgage and receives her R/E bill in the mail. Her CY 2008 tax bill reflects the rate of $12.39. Her CY 2009 bill states $17.78. Thinking it was a mistake, she wrote a letter to the city in June and is still waiting for a response. So, why are these important tax rate changes not published on the city's website in red ink? Our R/E tax doubled, so do yorself a favor and drop the 8% increase representation. We live in RI but work spend most of our time in MA where we have lived for decades, so we do not read Projo and do not feel we are obligated to. Please allocate some of our tax funds to training on ethics, integrity and transparency. And lastly, your representation "We hope you find our new Web site to be a useful resource" will remian to be false if you continue to lead the City of Pawtucket the way you have been!




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