Avedisian Proposes Tax Hikes for Warwick
Thursday, May 19, 2011
Warwick Mayor Scott Avedisian Wednesday unveiled a budget proposal for Rhode Island’s second biggest city that includes several major tax increases.
The $275.2 million budget calls for an 80 percent property tax increase and a new tax on vehicles in order to offset the loss of revenue resulting from the poor economy and the damaging floods that struck the city last March.
Avedisian prefaced his proposal by emphasizing the influential role last year’s floods played in the drafting of the new budget. The floods severely impacted the city’s largest retail center, the Warwick Mall, and resulted in the extended closure of numerous lucrative businesses, including Showcase Cinema, the Warwick Commons Shopping Centers, and the NYLO Hotel—which remains closed today. As a result, the city lost an estimated $6 million in commercial revenue.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTIncreased residential taxes
The mayor stated that it was this considerable loss in commercial revenue that necessitated significant tax increases on residential property owners. The budget features two main initiatives in this regard. The first is an 80 percent increase in the residential property tax, raising it to $18.28 of $1,000 assessed value. This increase represents a proposed tax rate levy increase of 4.13 percent, which is just shy of the maximum 4.25 percent increase allowable under state law.
The second new tax policy is an implementation of the motor vehicle tax. Many Rhode Island municipalities enacted similar taxes last year, but until now Warwick has maintained a hefty exemption of up to $6,000 off a vehicle’s value. In an attempt to lessen the burden on residential property owners, the new budget would eliminate that exemption—retaining only the minimum $500 exemption required by state law.
Some optimism for the future
The budget was not all bleak, however. Among significant funding increases was a recommended $1.7 million increase for the Warwick School Department, of which $875,000 has been set aside for the City’s Human Services Youth Programs budget, which funds school sports and other extracurricular activities.
The Mayor also cited the results of the last two Revenue Estimating Conferences, both of which projected increased revenue. Additionally, he expressed enthusiasm over the new Warwick train station and a project to make substantial improvements to 41 acres of shoreline at Rocky Point, both of which could help stimulate future economic activity. Finally, he briefly touted the finalization of plans to consolidate emergency dispatch services with neighboring East Greenwich—a merger that Avedisian believes will both improve efficiency and save money.
The budget must now go before the Warwick City Council, which can either approve or reject it, or pass their own amended version (as they did last year). Budget hearings are set for May 31, June 1, and June 2 in the City Council Chambers of Warwick City Hall.
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