Council approves new budget
The Jamestown Town Council last week balanced the $20.85 million budget proposed for fiscal year 2010-11 by unanimously approving a $1 increase in the property tax rate.
The special budget meeting was held on May 7. Islanders will have the final say on the tax hike when the proposed budget is presented for a vote at the June 7 financial town meeting.
At that point, there may be some last-minute adjustments to reflect fiscal decisions made by the General Assembly. But for now, the budget assumes that the legislature – as requested by the governor – will eliminate motor vehicle excise tax reimbursements to municipalities.
For Jamestown, that would mean a loss of $440,750 – which is the excise tax revenue that the town could collect in taxes from the owners of Jamestownregistered vehicles if it weren’t for the state exemption shielding the first $6,000 in vehicle value from municipal taxation.
To compensate for the loss of the reimbursement, Town Administrator Bruce Keiser had previously suggested reinstating the town tax on the first $6,000 of motor vehicle value under the assumption that the legislature would strike the exemption.
However, the General Assembly has still not acted on the exemption, and it would be risky, Keiser said, to balance the budget without any assurance that it will. The council agreed, and accepted the proposal to bridge the “reimbursement gap” by adding 17 cents to the current $8.11-per- $1,000 property tax rate.
Unfortunately, the revenue from the base $8.11 tax rate won’t be enough to balance the rest of the budget because the value of Jamestown property has declined.
The decline was identified by the 2009 property reassessment, which indicates that the value of town real estate – $2.13 billion as of Dec. 31, 2008 – has since declined to $1.94 billion. And there could be an additional decline if property owners disputing their reassessments are successful in their appeals.
Therefore, “just to maintain our current level of services,” Keiser told the council, “we would have to adjust the tax rate [upward] by 74 cents.”
The council accepted the proposal to recoup the loss in property tax revenue. However, besides this increase, and the 17- cent increase to recoup the loss in excise tax revenue, the proposed budget would increase the property tax by an additional 10 cents to fund the 1.18% increase in the property tax that the budget proposal had already requested – raising the property tax rate for FY 2010-11 to $9.12 per $1,000.
If, however, the General Assembly decides against eliminating the excise tax reimbursement, or eliminating only part of it, the $9.12 property tax rate could be reduced at a later date – in which case taxpayers could be provided with rebates. But, at this point, any such adjustments are purely speculative.
Another uncertainty that arose from the budget meeting involved a decision by the council to increase the line item for animal control spending. The proposed budget specified an expenditure of $10,000, which was intended to fund animal control services outsourced to North Kingstown after July 1 – when the full-time animal control officer position would have ended under the budget proposed by Keiser.
During their many discussions on the ACO issue, none of the Jamestown councilors had expressed any particular opposition to eliminating the position. But council member Bob Bowen offered a budget amendment to provide funding for a part-time ACO by increasing the $10,000 line item to $22,728 – which is half the full-time salary now paid to ACO Cathy Gregory.
Bowen said he was proposing the amendment because there was some money available for a part-time ACO position, whose future has been a controversial topic.
Alluding to an ACO workload analysis performed by Keiser at the request of the previous council, council member Michael White said, “It is difficult to justify a full-time ACO in this town, but a reduction in the number of hours might be justified.”
White also defended Keiser against allegations that he had unfairly targeted the ACO position, saying, “This is not the case. Bruce has been looking at all positions, and he has also recommended a cut in clerical hours. These decisions are not taken on as personal decisions.”
However, council president Michael Schnack – the only council member to vote against the animal control funding increase – said, “I would suggest that it isn’t up to the council to tell [Keiser] how to staff town positions. I don’t want to tell [Keiser] that you have to appoint a part-time ACO.”
Bowen, who withdrew his original motion and re-offered it without any reference to a parttime ACO, accepted the point raised by Schnack. As adopted, the motion only directs Keiser to spend the animal control allocation in a way that meets the animal control needs of the island.