Home Forums Reporting Non-Utilization Penalties and Tax Rate Caps

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  • Daniel Ducharme, Ph.D.
    Participant
    Post count: 4

    Just this week Code Enforcement and the Solicitor brought me a list of properties to apply the non-utilization penalty against. As this is the first time my finance director or myself have dealt with these, can anyone help me out with a quick problem we have? Am I able to exclude the non-utilization penalty from the tax cap calculation, or is it considered a normal part of my levy?

    We are already raising our levy the 4% this year, but I am going to be adding $450k in non-utilization penalties. So if I need to include it in the cap calculation, I am going to have to drop my rate around $0.75 and the finance director is worried that many of these may end up being abated or not collected which represents a substantial risk. So her hope is that we can collect this $450k on top of our normal levy although I do not believe that is possible.

    My tax roll is being grabbed to print my bills on Thursday, so if anyone has any information that could help, please send it over ASAP. Thank you in advance.

    Chris Celeste
    Keymaster
    Post count: 13

    We applied non-utilization tax in Woonsocket. You are correct that almost all will ultimately be abated.
    It’s a tool to fix blight, not a revenue generator. That being said, we made a non-utilization roll in vision/opal and kept it separate from the certified levy.
    I wouldn’t count any of that revenue in the budget due to my experience abating almost every one of them. All it takes is one rent reciept for one month and you need to abate.

    Daniel Ducharme, Ph.D.
    Participant
    Post count: 4

    OK, so you wouldn’t include it as a line item on the normal bill but would instead mail an entirely separate tax bill just for the non-utilization? Same quarterly payments, interest etc? Also, can you take these properties at tax sale if the non-utilization isn’t paid?

    Chris Celeste
    Keymaster
    Post count: 13

    Create a separate roll and copy the items from the main roll to the same accouont number on the non-utilization roll. Same quarterly payment schedule, same interest rules. Mail spearately, it will not be included as part of the certified levy as we discussed, since most if not all will be abated.
    If collections can cause payments to first go to the nonutilization bill before the normal annual tax bill, (as you would with outstanding balances on prior years) you should be able to tax sale if the regular bill is still unpaid. Not sure about tax sale for non-utilization only, that may ba an issue.

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