East Providence council keep up water, synchronization talks

Cunha, Britto once again touch on topics at recent meeting

By Mike Rego
Posted 9/26/16

EAST PROVIDENCE — A couple of issues that have been on both the front and back burners at times through the last year-plus — interest charges on water payments and the synchronization of …

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East Providence council keep up water, synchronization talks

Cunha, Britto once again touch on topics at recent meeting

Posted

EAST PROVIDENCE — A couple of issues that have been on both the front and back burners at times through the last year-plus — interest charges on water payments and the synchronization of East Providence's fiscal year budget with the state — were among the topics discussed by the city council at its Tuesday, Sept. 20, meeting.

Interest rates
Out-going Ward 2 Councilor Helder Cunha, who two weeks ago won the Democratic primary election for the State Representative District 64 seat, requested the council and the administration once again address the issue of interest charges added on to past due quarterly water-sewer payments.

Mr. Cunha said the city currently charges interest on late payments or the remaining balance of outstanding bills at a rate of 12 percent, a figured confirmed by City Finance Director Malcolm Moore. Mr. Moore, speaking to the council at the request of Mr. Cunha, noted the percentage East Providence charges was in the middle of the range allowed by the state, 6 to 18 percent.

Mr. Cunha, referring to the significant increases imposed on the self-funding system because of recent multi-million dollar improvements needed to the city's water supply, requested Mr. Moore and Acting City Manager Tim Chapman come up with a plan to offer residents relief.

Mr. Cunha asked the administrators to either initiate a "deferral" of or a "reduction" in the interest rate. He also asked if it were possible to give senior citizens dispensation or relief completely from interest charges.

Mr. Chapman, in response, said he and Mr. Moore would present the council with possible remedies and/or suggestions at the body's next meeting scheduled for Tuesday, Oct. 4.

FY sync
Saying the issue "has not fallen by the wayside," Ward 1 Councilor Bobby Britto reengaged discussion on the possibility of synchronizing the city's fiscal year with that of the state.

Long a matter contemplated by past and current politicians and elected officials, syncing the city's budget with the July-June state calendar would relieve East Providence of the need to borrow monies annually through Tax Anticipatory Notes or "TANs."

Because the city's fiscal year runs from November to October, East Providence, depending on how flush or short it's coffers are at the time, must borrow tens of millions of dollars as certain points during the calendar year to meet payroll and other obligations.

A positive aspect of having differing fiscal calendars is that the administration, the council as well as elected and appointed school officials know exactly what the state contributions to the city will be when East Providence's budget season takes place in the fall.

Most experts will say in order to accomplish synchronization, the city will either have to use additional TANs to borrow the necessary funds at the time of the change or collect a so-called "fifth quarter" of taxes during the fiscal year it is making the transition.

Mr. Britto, seemingly a proponent of synchronization, said he intends to work with state-appointed Municipal Finance Advisor Paul Luba to set up a public workshop on the issue in the near future.

Of synchronization, Mr. Britto said, "It's very important for the city in terms of long term savings on the money we borrow."

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Mike Rego

Mike Rego has worked at East Bay Newspapers since 2001, helping the company launch The Westport Shorelines. He soon after became a Sports Editor, spending the next 10-plus years in that role before taking over as editor of The East Providence Post in February of 2012. To contact Mike about The Post or to submit information, suggest story ideas or photo opportunities, etc. in East Providence, email mrego@eastbaymediagroup.com.