Taveras Urges Passage of Nonprofit Tax Law
Thursday, May 12, 2011
Providence Mayor Angel Taveras yesterday urged the General Assembly to pass a bill that would allow the city to levy a special tax on colleges, universities, and hospitals in order to help cope with the budget deficit.
If passed, the bill would allow Providence to institute a user fee equivalent to 25 percent of the assessed value of those institutions. The fee would generate an estimated total of $25 million in new revenue for the city. Taveras is not banking on the full amount to balance his budget—instead he is conservatively hoping to get at least $7 million more out of tax-exempt institutions next year.
The bill “is about creating an equitable and sustainable system that asks all the major tax exempt organizations in Providence to contribute their fair share to cover the costs of vital City services, such as police, fire, and maintenance of roads and infrastructure,” Taveras’ office said in a statement.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTThe Mayor was scheduled to testify in support of the bill before the House Finance Committee yesterday.
His office noted that similar efforts to tax nonprofits have been pursued in about 100 other communities around the country, most notably, Boston.
The total value of all the tax-exempt property is estimated at $3 billion. That value has more than doubled since the start of the decade, according to the Mayor’s office.
“This is an overwhelming burden for the families and small businesses who must fully subsidize the City services that we are by necessity mandated to supply,” his office said. “Providence is proud to be home to so many universities and hospitals and the City is grateful for all they contribute. Now, we need them to pay for just a fraction of the city services they consume.”
Click here to read the bill.
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