Tax Bill Issued As Court Challenge Fund Grows

With the mailing of this week’s supplemental tax bill in Woonsocket — expected to raise some $2.5 million — two lingering questions remain about the legality of the so-called "enactments" used by the budget commission, and the extra tax bill itself.

State Sen. Marc Cote [D-Dist. 24] recently argued before the commission that the enactments don’t meet the General Assembly’s requirements for the board to find $3.75 million in savings before issuing the additional tax bill.

But Mayor Leo Fontaine, during an interview on Monday after the most recent budget commission meeting, said he thinks the city would prevail in any dispute.

“When the General Assembly passed their legislation, they mentioned the word ‘enactments’ specifically, so that’s why I think it’s somewhat disingenuous now to say ‘Well, that’s not what we meant,’" Fontaine explained. "They put the word in the legislation, they had the opportunity to say ‘not enactments, but when you actually have a budgeted surplus of that amount.’ They could have done that, they didn’t, so that’s why the enactments are so important, because they were there to be a fail-safe and a backstop to protect the taxpayers.”

On July 2, the Rhode Island House of Representatives passed its version of a bill approving the supplemental tax bill, after the Senate added an amendment that requires the commission to find "$3,750,000 in savings resulting from municipal enactment or concessions from collective bargaining agreements…" 

State Rep. Lisa Baldelli-Hunt withdrew her hold on the bill in the House after the language was added, allowing both chambers to approve the legislation and send it to Gov. Lincoln Chafee for his signature.

The commission has put what it terms “enactments” in place on all city contracts except the fire union pact, which expires in 2014.

On Monday, Fontaine said his intent is to save as much money through concessions from the fire union as the proposed enactments would cut.

“Negotiations are ongoing and we have dates that are scheduled. They’ve been positive,” Fontaine explained. “We felt it important to continue those discussions, as opposed to moving forward with the enactments, [and] I thank the firefighters for their continued efforts, and I’m optimistic that we’re going to reach agreement.”

The mayor held out the possibility, though, that the enactments may still be needed.

“When we went forward with what we were looking to reach in concessions through negotiations, we needed to put a backstop there to say that if we’re not successful, we’re still going to reach those savings, and that’s what those enactments are all about,” said Fontaine.

In the meantime, the taxpayer-led drive to raise money for a legal challenge has collected more than $4,000, according to resident Roland Michaud.

The tax bill represents a $1.76-per-$1,000 levy on residential property and a $2.41-per-$1,000 hike on commercial property, when added to the estimated fiscal 2014 tax rates.

When added to other recent tax increases, Council President John Ward on Monday said the supplemental bill brings the total hike to 23 percent.

Rita Turcotte, who brought a sign made by Michaud that said “Stop the Madness Now,” explained that she and other taxpayers are using the tools they have available to challenge the supplemental bill.

“The people of Woonsocket need representation, not just the unions,” Turcotte said during an interview before Monday’s session. “The people from the state either have to give us the money or let us go into receivership.”

Michaud previously said that taxpayers should withhold their payments until the last due date for the supplemental bill — Aug. 31 — while the legal challenge is pursued.

On Monday, Michaud declined further comment.

Asked about the potential court challenge, Fontaine said he thinks it would “complicate” the budget commission’s work.

“We’ve been acting under all sound legal advise to us that we are within our rights to move forward with this, the supplemental issuance was done after the advice of legal counsel,” Fontaine said. “If the supplemental [tax] is successfully challenged in court, we wind up in a situation that it just sets us back even further — we feel that we have a strong legal argument as far as where we go, but obviously there’s a difference of opinion.”