Chafee Benefits from Tax Breaks on RI Properties

Monday, November 01, 2010

Stephen Beale, GoLocalProv Politics Editor

With 11 motor vehicles registered in Exeter, a homestead exemption in Providence, and a declaration of residency in Warwick, Lincoln Chafee has a complex web of homes and properties in Rhode Island.

This complex web of ownership brings a series of financial and political benefits to the Chafees. Their motor vehicle registrations at the couple’s Exeter farm allow them to benefit from a lower car tax rate. Their homestead exemption in Providence cuts the property taxes on his 54 Barnes Street home by as much as half and Chafee's residency in Warwick has allowed him to mount his campaign for governor from a political base of support. (Click here to view the documents.)

“I don’t think it’s appropriate. I think you have to pay taxes in the town you live in, where you are registered to vote, because that’s your primary residence,” said Marie Sorman, president of Operation Clean Government. “There just seems to be something wrong with someone with that much wealth doing everything they can to dodge taxes while the rest of us are struggling.”

Public officials avoiding car taxes

GoLocalProv has an ongoing investigation looking into attempts by public officials to avoid higher car taxes by paying taxes in communities with lower rates rather than the community in which they live. In August, GoLocalProv reported that a Lincoln fire chief, Frank Sylvester, had registered his cars at his office in Lincoln, rather than his home in Pawtucket, saving nearly $900 each year on his taxes. That was illegal—because he was registering his personal cars on public property.

Chafee motor vehicles registered in Exeter

The Chafees have a somewhat different situation. In 2009, Chafee and his wife had 11 motor vehicles registered in Exeter, where they have a 916.8-acre farm worth $1.6 million according to Exeter town assessment records.

Amongst the cars registered in Exeter are a 1997 Audi and three Toyota Priuses. The Chafees do not currently have any cars registered in Providence and Lincoln Chafee has a trailer with an assessed value of $500 registered at his 22 Beachwood Drive home in Warwick. Each of these numbers is according to the respective assessor’s departments in those communities. The current car tax rate in Exeter is $32.59 per $1,000 in value, compared to $76.78 in Providence and $34.60 in Warwick.

Thanks to the lower tax rate, the Chafees—who had a last reported net worth of as much as $47.8 million—were billed $2,786.46 in car taxes to Exeter in 2009, compared to as much as $6,564.69 in Providence, a savings of just under $4,000. For most taxpayers, motor vehicles are registered at a person’s primary residence, but an exclusion in state law allows individuals to register motor vehicles at a separate location if they are “customarily kept there.”

Homestead exemption in Providence

The Chafees also have a homestead exemption on their 54 Barnes Street home in Providence, according to the city assessor’s department. The exemption is up to 50 percent of the property value, according to the city ordinance in effect before July 28, 2010. (The property is listed as having two owners, according to city assessment data: the Barnes Street Trust I and II and Andrew W. Davis, who is a trustee. Lincoln Chafee and his wife are the beneficiaries of the trust and Davis is their attorney, according to Chafee’s filing with the state Ethics Commission.)

“Lincoln Chafee is not paying his fair share of the heavy tax burden we are carrying in this state. The Chafees claimed a homestead in Providence to drive down their property taxes, but kept their cars registered in Exeter where the (tax) rate was almost 60 percent lower,” said Caprio spokesman Nick Hemond. “While everyone else in Providence has to pay one of the highest tax rates in the state, the Chafees cheated the system.”

Declares residency in Warwick

Now, Chafee is claiming a third community as his residence. When he filed his declaration of candidacy form with the Rhode Island Board of Elections on June 28, 2010, Chafee listed his 22 Beachwood Drive home in Warwick as his residence. By claiming Warwick as his residence, Chafee was able to claim as his base of support a city where he was mayor throughout much of 1990s.

Chafee Campaign Manager Mike Trainor declined to comment.