Town Won't Penalize Businesses for Landlord Back Taxes Anymore

What happened to Lina Piccolina at 58 Main Street in East Greenwich earlier this year won’t happen again, thanks to a unanimous Town Council vote to strike a provision enabling the town to refuse a businesses’ license renewal if their landlord is behind on taxes.

Lina Piccolina, a upscale children’s clothing store, hit a snag during her second-hand dealer license renewal process in May when the Town Council initially refused to renew it on account of thousands in back taxes owed for the property the store shares with several other businesses in the historic retail building.

But the money was actually not owed by the owner of Lina Piccolina. It was owed by her landlord, Dale DeJoy, who was furious after the ordeal for what he believed was one of his tenants getting singled out for taxes that he technically owed. In fact, he said Lina Piccolina didn’t owe any money to the town and pays her lease on time.

In an interview, he said the issue cast a pall on his tenants, he said, with the owner of Lina Piccolina being thrust into an issue she had no awareness of, attaching her name to a problem she didn’t create.

DeJoy said he always paid his taxes every year before they went to tax sale, but the town has recently launched an aggressive campaign to go after revenue, especially back taxes. He claimed that the town only recently decided to enforce the old ordinance to get people like him to pay earlier.

Eventually, the council granted Lina Piccolina her license, DeJoy has put 58 Main St. on the market, and the Town Council appears to have agreed that the existing ordinances needed a second look to be more fair and equitable.

“It is unfair to penalize the unaffiliated actions of a landlord,” said Town Council President Michael Isaacs before the 5-0 vote last Monday, noting the town still has recourse to collect back taxes such as tax sales.

They key word in the ordinance change is “unaffiliated,” which means the town can still deny a permit or license to a business owner who also owns their storefront or office.

Under the old ordinance, the Town Council was unable to grant a license or permit to any person renting in the town from an owner or landlord who is in arrears in any tax, lien or assessment.

The revision adds a provision that states that “in the event that the owner or landlord is not “affiliated” with the person seeking the license or permit, then the Town Council shall be empowered to grant such license or permit.”

Affiliated means a direct ownership interest in the business or an indirect ownership, such as an equity stake or a shareholder arrangement.

The vote last week was the first reading of the new ordinance. The third and final reading is scheduled for their Aug. 25 meeting.