The Highest RI Property Taxes Per Capita
Monday, December 12, 2011
Rhode Islanders on average will be expected to pay just over $2,427 in property taxes in 2012 and only seven communities will ask their residents to pay the same or less than they did last year.
As GoLocalProv has previously reported, Rhode Island Department of Revenue numbers show the combined property tax levy for all cities and towns in the state in 2012 is $2,114,326,766. When broken down on a per capita basis, the figures show several affluent cities and towns have residents paying significantly higher amounts in property taxes than residents along the urban corridor.
Residents in New Shoreham, Jamestown, Barrington and East Greenwich - four of the wealthiest locations in the Ocean State- will pay more than $3,330 in property taxes in 2012 despite having some of the lowest tax rates in the state. In total, residents of 17 cities and towns will pay more than the $2,427 average, while residents in places where property values have plummeted in recent years will pay well-below the average.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTFox example, at just $678.91 per resident, Central Falls expects to collect by far the least amount in property taxes during the 2012 fiscal year. Similarly, Woonsocket and Pawtucket rank near the bottom of the list as well.
RIPEC Report: 7th Highest Property Tax Collections
The figures reflect the state’s status as one of the highest taxed places in the country and the numbers are likely to grow. This year, only Exeter, Foster, Lincoln, Little Compton, North Smithfield, Pawtucket and West Warwick did not raise property taxes.
According to a report released in October by the Rhode Island Public Expenditure Council (RIPEC), the state had the 13th highest tax burden in the United States during the 2009 fiscal year. The state’s ranking was mainly due to property tax collections, which accounted for about 45 percent of all state and local tax revenues in FY 2009.
“In general, property taxes represent the largest share of tax collections, accounting for 33.4 percent of all FY 2009 taxes across the country. In Rhode Island, the property tax accounted for 44.6 percent of total collections in FY 2009, accounting for an 11.3 percent greater share of taxes than the national average,” the report stated.
At $2,020 per capita, the Ocean State had the 7th highest property tax collections in the country during FY 2009. The national average was $1,393 and only New Jersey, Connecticut, New Hampshire, Wyoming, New York and Vermont ranked higher.
According to RIPEC, between FY 1999 and FY 2009 “property tax collections per capita increased by 35.6 percent in Rhode Island, the third highest rate of growth in New England.”
Providence: No Promise Taxes Won’t Go Up
Providence projects to collect just over $324 million in property taxes in 2012, but the per capita numbers hovers around $1,822, the 9th lowest amount in the state. When attempting to address a staggering budget deficit this year, the city was one of three communities that applied to raise property taxes beyond the 4.25 percent cap.
Asked last week if taxes would again be on the rise next year, Mayor Angel Taveras told GoLocalProv he couldn’t make any promises.
“That’s something that we’d like to avoid if at all possible, but I can’t make any guarantees on that obviously,” Taveras said.
The biggest problem for Providence, according to Taveras, is that the city is attempting to address problems that were created more than two decades ago, when he was still in college. The city spent $58.9 million on pensions during the 2011 fiscal year and with changes to the current system, that number will skyrocket in the coming years.
“If you want to solve this issue in this city we are going to have to address the past,” Taveras said.
URI Expert: Surviving More With Less
Because taxes often go toward benefits and paying old debts, Dr. Edward Mazze, Distinguished University Professor of Business Administration at the University of Rhode Island, said the residents shouldn’t expect an increase in services in exchange for paying more in taxes.
“Relying on property taxes, most municipalities have little or no discretionary funds for emergencies or special projects,” Mazze said in October. “Towns and cities do collect other taxes and fees which are a small and important part of the municipal budget. The largest percentage of property taxes and other sources of revenue go to personnel, fringe benefits, interest on past borrowings/bonds and retirement and health benefits for former municipal employees. Road repairs and maintenance of municipal facilities and assets are often postponed because of a lack of funds.”
Mazze said surviving more with less has become the norm for cities and towns in Rhode Island.
“In the last three years, the municipalities have had to survive with less state support as costs of doing government business and maintaining their school systems has increased,” Mazze said. “A number of Rhode Island municipalities may have to consider filing for Chapter 9 bankruptcy as has Central Falls if sources of revenue from local taxpayers and the state do not increase. Municipalities will not be able to provide the services taxpayers expect because of budget constraints and may be the last of the entities exiting the 2007 recession.”
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