Car tax bills still in limbo

Mayor Scott Avedisian believes he’s one of the few who has paid their car taxes. That’s because he didn’t wait for a bill in the mail but, rather, went online.

Tax bills for the city’s 109,000 vehicles registered in the city for a total levy of $22 million were ready to be mailed out last week. Now they could go out next week. Or perhaps they could get delayed again.

It’s not that the city doesn’t need the money. It’s in the budget.

The issue is the $9.2 billion state budget and the fact that it has still not passed. The hang-up with the state budget, which could get resolved next week should the Senate reconvene and approve the budget as sent over by the House, is legislation that would start the phaseout of municipal car taxes over the next six years. Larry Berman, spokesman for House Speaker Nicholas Mattiello, said Monday there are no new developments on the budget standoff, although the Speaker and President of the Senate Dominick Ruggiero plan to meet today.

“Assuming the Senate comes back into session soon to reconsider and pass the House budget, as the president has publicly stated, the Speaker has indicated a willingness to come back in September and complete unfinished legislative business from the session,” Berman said.

Meanwhile, on the city side, City Tax Assessor Christopher Celeste said while 50,000 Warwick car tax bills were printed up last week, the decision was made to postpone mailing them. If the Senate passes the House budget, new bills reflecting a reduced tax would need to be printed.

Under the bill, the state would reimburse taxes municipalities would have otherwise collected for a total annual commitment of $221 million by the time the program is fully implemented. While the legislation has several triggers to reduce motor vehicle taxes, in its first year only two would apply to Warwick taxpayers, according to Celeste. It would immediately take vehicles that are 15 years old or older off the tax rolls and reduce the valuations of others still on the rolls by 5 percent. The tax rate of $34.60 per $1,000 of valuation would remain unchanged until later years in the program, when it would eventually disappear completely. He estimated the reimbursement to the city at $2.5 million to $3 million this year.

The architect of the plan, Mattiello, vowed to implement the first phase of the program this year, even though municipalities were faced with finalizing their budgets and mailing tax bills in June for the first quarterly payment on July 15. Most cities and towns, Warwick being one of them, went ahead and billed for property and tangible taxes with the expectation the House budget, as has been the tradition, would be approved unchanged by the Senate. Municipalities would then send out the car taxes with the relief Mattiello promised.

But on the final night of the session, even though the Senate Finance Committee approved the House budget, when it reached the Senate floor for a vote, senators approved an amendment to the car tax relief bill that would sideline the program if the state lacked the funding to finance it. Adhering to his promise to end the custom of night-long closing sessions where legislation gets pushed through with scant review, Mattiello adjourned the House and sent representatives home by 10 p.m., leaving the state budget in limbo.

When it looked like neither side would budge – Mattiello wasn’t going to reconvene the House to vote on the Senate version of the budget and Senate President Dominick Ruggiero wasn’t going to call back the Senate to pass the House budget – Mayor Avedisian gave the order to mail out the motor vehicle bills. The city was in the process of doing that when Mattiello and Ruggiero opened talks and it looked like the Senate would reconvene.

City Finance Director Ernest Zmyslinski said the delay wouldn’t affect the city’s ability to meet its financial obligations as the first quarter payments on real estate are on schedule. Mayor Avedisian said taxpayers would be given two weeks to pay car taxes once the bills have been mailed.

As for those who have already paid online, the mayor said any adjustment resulting from approval of the legislation would be credited to later quarterly payments or to real estate taxes should an older car be coming off the tax rolls. In instances where a taxpayer owes no other taxes, a reimbursement would be issued.