Nunes Calls for Equitable Motor Vehicle Excise Tax Reimbursement System

STATE HOUSE – In an attempt to provide some relief to the communities hit hard by the state’s removal of motor vehicle tax reimbursements three years ago, Rep. Jared R. Nunes (D – Dist. 25, Coventry, West Warwick) wants to provide cities and towns with reimbursements for the excise tax based on the percentage of assessed vehicle values in each community.

“It’s time we took a serious look at how we can fairly and equitably reimburse our cities and towns,” Representative Nunes said. “The removal of the reimbursement for motor vehicle excise taxes was a highly protested move from taxpayers all over the state. Municipalities were forced to make tough choices because of the choices made higher in state government. But three years later, I think it’s only right to institute a fair reimbursement strategy based on vehicle values versus individual tax rates, which range from $9.75 per $1,000 to $60 per $1,000."

"Most communities would receive more than they were getting during the previous reimbursement program, and others would receive less," Nunes continued. "The important thing is that it’s equitable because right now, people in West Warwick and Coventry are subsidizing the reimbursement for cities like Providence and Woonsocket.”

In 2010, the $133-million aid program designed to reimburse municipalities for exempting the first $6,000 in value of a motor vehicle was eliminated. Cities and towns were given the option of reducing the vehicle tax exemption to $500 to balance the significant cut in aid. Some communities chose to cut the exemption to $500, while only a few others were willing to foot the bill and keep the $6,000 exemption.

Under the provisions of the bill, Coventry would receive almost $410,000 and West Warwick would receive more than $273,000 in reimbursement funds. The reimbursements, which would total $10 million for the entire state, would be distributed from the state general revenue fund.

Cosponsors of the bill (2013-H 5272), which has been referred to the House Committee on Finance, include Representatives Mia A. Ackerman (D – Dist. 45, Cumberland, Lincoln), Joy Hearn (D – Dist. 66, Barrington, East Providence), John G. Edwards (D – Dist. 70, Portsmouth, Tiverton) and Michael J. Marcello (D – Dist. 41, Scituate, Cranston).