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Sunday, April 30, 2017

UPDATED: Charlestown budget and taxes topic of hearing Monday night

UPDATED: Taxes WILL go up. How and by how much?
By Will Collette

"Faith's Folly," one of the boondoggle projects that are adding to
your tax bill. 4,000% over budget and hardly ever used.
Details down below.
 
Every single year since they took control of Charlestown town government, the Charlestown Citizens Alliance (CCA Party) has raised taxes. That will be the case this year, too.

UPDATE: As usual, the CCA Party makes the claim that Charlestown's tax rate is very low compared to other municipalities, except they always leave out any comparison of what taxpayers in other municipalities GET for their tax dollars.

This year, unlike past years, they are drawing attention to the tax rate. 

That's because, since 2008, the CCA Party has increased the tax rate. This was a revaluation year and that gives the CCA Party an opportunity to cloud over how they will increase town taxes.

Charlestown property owners have already been notified by Charlestown Tax Assessor Ken Swain what their homes are worth under the new valuation Charlestown will use to calculate their taxes. Cathy and I got notice that our assessment is going up by 9.4%.

Overall, the value of all taxable property in Charlestown went from over $2.3 billion to $2.5 billion, or approximately 8%. Put that number up against the reduction in the tax rate.

The Budget Commission will hold a public hearing on the budget on Monday, May 1 where they will present the new $27,724,601 Fiscal 2018 Budget.

Of that amount, just over 50% covers Charlestown’s share of the cost of the Chariho School District. That part of the budget has already been approved by voters and is now locked in.

The Budget Commission is recommending a drop in the tax rate from the current $10.21 per $1000 of valuation to $9.54, a number subject to change all the way until the budget is finalized and approved by voters at the June 5 townwide Financial Referendum.

But the Budget Commission proposes that actual tax collections rise to $24,400,793, an increase of 1.15% despite the drop in the tax rate.

Hope you haven’t dropped off to sleep. Yes, the tax rate will drop for the first time since 2008 (which was another revaluation year) but no, you will probably still pay higher taxes.

Since my tax valuation is up by 9.4%, that wipes out the effect of the drop in the tax rate and then some. I suspect many, maybe most, other Charlestown taxpayers will be in the same boat.

Narragansett gets it but we don’t.

Making it even more galling is that the CCA Party has denied Charlestown residents the benefits of the Homestead Tax Credit available to other Rhode Island communities, but not here in Charlestown.

Narragansett’s Homestead Exemption just went into effect, giving full-time residents who do not rent out their property up to 10% off the tax valuation of their home. More than 3,000 residents have applied to receive the exemption which is close to the Narragansett tax officials’ estimate of the total eligible households.


When Narragansett debated this issue, they responded differently to the concerns of non-residents that ended up killing a similar Homestead Tax Credit proposal offered by Charlestown Democrats in 2011.

The CCA's main attack on the Dem's proposal was the claim that giving full-time residents a tax break was unfair to non-residents, people who rent out their property and to the renters themselves. In Charlestown, where the CCA Party is funded primarily by non-residents, that was a killer argument. In Narragansett, absentee landlords are not held in such high esteem.

“Fairness” is a fake argument to begin with. Every tax policy discriminates against somebody. In Charlestown, for example, veterans, the blind and disabled, low-income seniors, the clergy and people whose lands are designated as farm, forest or open space receive generous tax breaks.

If you are not in any of those groups, are you being treated unfairly? Using the CCA Party argument against the Homestead Tax Credit, the answer would have to be “yes.”

Yet we do not begrudge veterans or the other tax-favored groups because tax policy is also a statement of principles. There’s even some talk about increasing and broadening the tax breaks for veterans even more. Through the way we tax, we signify what we care about.

So yes, we want to honor veterans, help the handicapped and low-income seniors, and encourage land conservation. We do so through our tax policy. In Charlestown, the CCA-controlled town government makes it clear they care more about non-residents than about the people who make Charlestown their home.

Budget tidbits

It’s no secret, or surprise, that the increase in the town’s property valuations have been led by the boom in high-end properties.

The High Point estate, bought for $4.025 million. (Charlestown
Tax Assessor's database)
Case in point: last week, the Westerly Sun ran a story about the sale of 89B South Arnolda, the “High Point” estate, for $4.025 million, the highest Charlestown real estate sale since 2008.

The property was sold by Christina Allen to Carousel Industries executive Jeffrey Gardner and his wife Kathryn who are listed in the Charlestown Tax Assessor database as still living in Wakefield.

Now the property will be taxed at the sale price which is $1.1 million higher than the last assessment while Ms. Allen owned it.

***


Record House Sale In Quonochontaug
Yet another big ticket real estate sale was publicized in Patch on April 29. They note Lila Delman's sale of a Quonochontaug "beach cottage" at 101 Surfside Avenue for $2,075,000.

But unlike the High Point estate, above, this property was purchased for a lot less than the town's tax assessed value which was $2,347,100. That knocks $272,100 off the town's tax base.

The seller was a limited liability corporation based in Stonington, CT. The Tax Assessor's database does not show the name of the new buyer yet.


***

After the 2018 budget goes into effect, you will be able to see for yourself the difference between your current tax bill and your new bill by using another Charlestown Tax Database.

***

Before Monday’s hearing, you may want to go through at least the introductory pages of the Budget Commission’s recommendation.

What stood out for me are the two line items that changed the most.

The biggest increase of almost 17% is for “debt service,” the payment on the bonds Charlestown issued to borrow money for projects like, for example, “Faith’s Folly.”

This is the mile and a quarter asphalt bike path that was built in Ninigret Park at the insistence of CCA Party co-founder Faith LaBossiere. When Faith first presented the proposal to the Town Council, she pegged the price tag at only $7,000 or about the amount the CCA figured they could find in Tom Gentz’s couch cushions.

Tons and tons and tons of asphalt jacked up the price of "Faith's Folly"
from $7,000 to over $300,000 with interest. (Photo by Will Collette)
A $7,000 price tag seems a modest sum to assuage Faith’s ego, but in the end, the project ended up costing $266,927 plus interest on the bond leading to a cost over-run of 4,000%.

Yep, all those tons of asphalt in a park already has miles of old Navy airfield runways are adding to your new tax bill.

This silly thing is going to formally dedicated on May 13, coinciding with National Bike Safety Day. 

I am sure this thing is going to be named after Faith LaBossiere, but if there is any justice in Charlestown, they’ll formally name it Faith’s Folly.

The other budget item showing the biggest change is, ironically, capital expenditures, down 16.33% from last year. We’re going to pay for debt we’ve incurred for past projects partly by curbing projects that are shovel-ready. Again, thanks Faith.