Budget Commission Considers Taxing Non-Profit Properties

Decision on sending letters to non-profit groups tabled for discussion Nov. 27.


Twenty-five non-profit organizations owning 60 parcels in the city might have to start paying property tax.  

Woonsocket Tax Assessor Chris Celeste asked The Woonsocket Budget Commission Thursday if he should send letters to the organizations telling them they're not exempt from the tax rolls.

Though three members and Rosemary Booth Gallogly, director of the department of revenue, voiced support for the idea, the Commission tabled discussion until their Nov. 27 meeting. The delay, an increasingly common refrain for the panel, was the latest example of the body's frustratingly slow progress for member Mayor Leo Fontaine.

"Every decision is being extended out," Fontaine said, "Every day that goes by is one less to solve the problem." 

That problem, the city's looming $15 million deficit, has remained unsolved since the Budget Commission's appointment in May. If levied, the new taxes Celeste suggested would help the city raise revenues to help rub out some of that red ink. Celeste said he is still figuring how much revenue taxes on the properties would raise for the city.

Commission member City Council President John Ward, who said he supported taxing the non-profits' property, noted the city's most recent assessments of the properties are probably out of date.

Celeste said the letters could be worded to let the non-profits know the city is considering taxing them. He said the letters could also invite the non-profits to discuss tax agreements with the city in lieu of impending tax levies, and avoid a costly ($10,000 to $15,000) appraisal of the parcels.

"I have no problem sending out the letters," said Commission member Peder Schaefer. But, he said, they should have the Commission's counsel Edward Alves have a look at the letters first.

Fontaine suggested that the City Council get a look at the letter beforehand as well. He said they may want to exempt certain groups from any new taxes levied.

"Nobody is saying that these organizations are not doing great things for the city or the state, I want to get that out there. They may be doing great things, but the reality is that they don't meet the statute (for exemption from property tax)." 

RI General Law 43-3-3, Property Exempt, doesn't appear to list non-profit organizations among the list of eligible tax exempt entities. Churches and schools, along with other educational organizations make the cut, but the rest are up to the discretion of municipal government.

501C3 status, which many of the city's non-profits enjoy, applies to federal taxes.

The YWCA and YMCA have a specific state charter that makes them exempt from property taxes, Ward said.

The IRS states, "In addition to exemption from the payment of federal income tax, organizations recognized as exempt under IRC 501(c)(3), may enjoy collateral benefits under the Internal Revenue Code, as well as under state or local income, property, sales, use, or other tax provisions," but it doesn't grant that status.

"If you would like to draw up legislation that makes it clear that they're taxable, I'm sure a lot of communities would approve that," said Gallogly.

"There is a lot of case law on this," Schaefer warned.

"Only for the people who want to put up a fight," Ward said, "And they usually lose."

On Chairman Bill Sequino's suggestion, the Commission tabled the discussion until Nov. 27 for further study.






Sly November 13, 2012 at 11:03 AM
Fairness to the mayor,where's our fairness Rob.On the same people being re-elected it's amazing what a few chicken dinners will do at the senior high rises.Fontaine and Ward are very smart.they target the older group in the city that live on section 8.Passing the referendums did you expect anything different,We have to be the dumbest State in the Country,with the dumbest voters.Like I've said before there time is coming and the city will be much better of without those 2 bafoons.
lorrie scullin November 13, 2012 at 05:04 PM
Ladies and gentlemen - I am still waiting on the investigation into the Woonsocket School Department and last year' $230,000 surplus to its $10 million dollar deficit!!!!! WHY ARE WE NOT GETTING ANSWERS AND WHO IS COVERING UP THE IGNORANCE???? THROW ALL THE BUMS OUT COME NOVEMBER 2013!!!!!
Boingo Boingo November 13, 2012 at 06:08 PM
IMO,i think every employee and Pol in Woonsocket should have a local tax levied against them.
Sly November 13, 2012 at 06:21 PM
I have 2 words for everyone.FONTAINE,WARD.Our well suited Mayor and City Council Boss know all,but say nothing.They will alway's be remembered here in Woonsocket.
Russell Archambault November 14, 2012 at 06:34 AM
GROWING; again,looking at paying a 50.00 cell phone per month or TV. cost, is really not looking at the real problem. There are people out there that are about to loose their total investment.There are over two hundred vacant buildings right now. with no one addressing this problem. The city does not have a problem with this because they are still collecting taxes from whomever. This situation can be rectified. The city leaders overlook this because they cannot come up with a plan. I have a plan to change this problem.This entire way of our leaders looking at trying to solve the city's money situation will never work. WE now need business owners who understand, who are used to figuring out on how to get out of unforeseen problems. Investments in the cities future is the only solution. WE need to get started now before its to late for the tax paying citizens of woonsocket.


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