Calling the town’s financial state an “emergency situation,” the state auditor general on Wednesday approved the Town of Warren’s request to exceed the state’s maximum property tax levy by $685,694 this coming fiscal year. As it stands right now, the result will be a tax increase in the neighborhood of 7.6 percent, nearly double the 4 percent max allowed by state law.
Warren is the only town in the state to ask permission to exceed the tax cap this year. The overage was brought on by a sharp increase in school spending — approximately $1.5 million more than last year — which was due mostly to a rise in school enrollment in Warren and a corresponding increase in the town’s financial obligation to the Bristol Warren Regional School District.
The Warren Town Council offset much of that school increase by cutting many town services, terminating several part time employees and putting off capital spending and long-planned projects. In all, councilors cut about $1 million from the municipal budget to help bring the tax levy down, but still fell $685,694 short of their goal. Had auditor general Dennis E. Hoyle had not approved the overage request, the council would have had to cut more. Town council president Chris Stanley said the additional cuts would cost additional employees their jobs, as “there’s nowhere else to cut.”
Under the state’s approved levy, Warren’s tax rate this coming year will be $20.09, up from the current $18.67. That means that the owner of a $250,000 home will pay $5,022.50 in property taxes this coming year, up $355 from the current year. The budget must still be approved by voters at Financial Town Meeting in May.
Councilors said last week that the levy increase is not a solution, just a temporary answer in an ongoing problem. Without the tax base as a means to generate additional tax revenue, and a minority position on the Joint Finance Committee, the Town of Warren will see similar financial emergencies every year, councilors say.
“We have to look at the numbers, we have to look at the future,” councilor Joseph DePasquale said at a sparsely attended public budget hearing last week. “It would not be prudent for us to not look down the road for an answer.”
Even though the state answered the levy question, town officials are still waiting for word on one other significant request: That the state’s education funding formula be applied differently in Bristol Warren. In a suit filed two weeks ago, town officials asked a Rhode Island Superior Court judge to determine whether the state’s funding formula has been applied properly for the past three years; councilors believe they have been paying too much as a result of an improperly applied formula.
The answer to that question will account for an approximate $2 million swing in the budget, either way.