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Wednesday, August 4, 2010

Council Leader Vows Changes in City’s Property Tax Structure

Off the heels of an active week discussing Mayor David Cicilline’s elimination of property tax exemptions for landlords, City Council Majority Leader Terrence M. Hassett has vowed to re-visit the issue for the 2011-2012 fiscal year, his office announced today. 

Hassett said that the manner in which the mayor abruptly removed the tax exemption from his budget proposal caused a significant tax increase for some East Side property owners. The councilman noted that during budget deliberations, City officials touted the change, informing Council members that the 33% exemption for owners who do not live in the home was “illegal,” and inconsistent with state law. Hassett said the City’s position was based on an opinion by the City Solicitor that the so-called “homestead exemption” is allowable only for owner-occupied residential property. The Mayor later reversed his position and sought to re-instate the exemption, despite it being declared illegal, Hassett explained.

“The current property structure in the city needs to be examined,” Hassett said. “I want to insure that the City treats everyone fairly when levying taxes.” 

Last month, Hassett announced an initiative to establish an alternative property tax rate for tax exempt institutions. He said a deeper discussion of “more thorough changes in the property tax rate system is necessary, and will be addressed for the next tax year.” 

Hassett continued, “I have listened to and spoken with numerous landowners who will be adversely affected by the Mayor’s elimination of the tax exemption for landlords. We need to be fair about how we collect taxes. This sea-saw effect that results from a re-evaluation needs to be changed.”

Hassett said he will create a working group to undertake an examination of the current tax structure and proposals to produce tax revenue fairly. He expects that a proposal will be ready for the next session of the General Assembly.