Officials discuss cutting tangible taxes on small businesses

Officials discuss cutting tangible taxes on small businesses

Council also moves toward finding engineer for Centredale changes

NORTH PROVIDENCE – Town officials are now in talks about whether they should eliminate most tangible taxes paid by businesses in town, all while potentially securing as much or more tangible tax revenue than they are currently receiving.

The idea came up during a multi-pronged discussion on the revitalization of Centredale last week. Council members offered initial positive reactions to a suggestion from developer Shane Piche that eliminating the tangibles could have far-reaching impacts on the local economy, helping local businesses reduce overhead while not hurting taxpayers.

Piche said he met with Tax Assessor/Collector Tom Kane and learned that tangible taxes from small businesses in town make up only 10 percent of the entire tangible budget. The big money, he said, comes from entities such as Verizon, National Grid, and the Narragansett Bay Commission, which pay tangible tax money on their more valuable assets in town.

North Providence could raise the tangible tax rate overall, said Piche, securing more money from these larger entities and potentially greater revenue while giving a jolt to small businesses, allowing “mom and pop” shops to compete in an increasingly competitive marketplace.

The idea would be to exempt the first $100,000 of tangible tax value, a move that would require approval from the General Assembly, he acknowledged. That cutoff would eliminate most businesses from having to pay anything in tangible taxes on such items as furnishings and equipment.

Piche noted that this sort of initiative has come up in other communities, and he would love to see North Providence be the first to jump on it. There has also been some talk at the state level about phasing out this type of taxes.

A tangible tax bill might not seem like a lot, said Piche, but the owner of a local breakfast restaurant has to flip a lot of eggs to pay them. He said some local business owners have indicated that they would invest more in their properties if they weren’t paying tangible taxes on 25-year-old equipment.

North Providence’s current tangible tax rate is $68.11 per $1,000 of assessed value, meaning $30,000 worth of equipment and furnishings would bring an annual tax bill of about $2,043.

At just five square miles, North Providence should “be a pinnacle community” and “pristine in every way,” said Piche, which is why moves such as eliminating what is essentially an “inventory tax” make sense to make the town more competitive.

Councilor Ken Amoriggi was among those who said they liked Piche’s idea, saying he wants to see the exact breakdown on the 10 percent claim. Amoriggi said he’s the son of a longtime town business owner who “spent many years cursing” about the tangible taxes. Councilor Mario Martone said he too thinks it’s worth looking into.

Centredale traffic changes gain momentum

Piche’s comments came as part of a larger discussion on Feb. 4 about ways town officials could make the Centredale area more friendly to business, including potential traffic changes. He spoke in favor of Mayor Charles Lombardi’s earlier proposal to turn a portion of the Centredale Bypass running from the Centredale roundabout to Mineral Spring Avenue into two-way traffic. Not one business owner he’s spoken to has been opposed to such a change, he said.

Lombardi said the requested change to that one section is the “first step and the easiest thing for us to do to try to address some of the traffic and our public safety needs.”

Piche mentioned the Rhode Island Historic Preservation Commission’s assessment that Centredale “as it looks today has lost much of its village quality and sense of place along the river due to the loss of its mills and the construction of the Centredale Bypass, which routes westbound traffic around the Centredale Business District and tends to fragment and isolate sections” of the area from each other.

Piche brought with him a petition from business owners supporting traffic changes.

The council was generally supportive of the proposed traffic changes as well, referring them to a finance subcommittee, which would consider hiring an engineering firm to come up with a plan to present to the state. Among their concerns were whether existing busing service could be maintained.

Changes would not come with a great expense to the town, said Piche, as these are state roads. He’s been assured that if the town covers the cost of engineering, the state will make sure the works gets into the transportation improvement plan. He said the town has grant opportunities to put toward the engineering and drafting a unified plan.

Councilor Steven DiLorenzo asked Piche what he would like to see for traffic flow in a perfect world.

“In a perfect world, I think every street should be a two-way street,” Piche responded.

Piche and Lombardi emphasized the public safety benefits from making easy adjustments to the Centredale traffic pattern, particularly eliminating one-way traffic on the bypass. Piche also wants to see the area become more walkable.

As another potential boost to business here, Piche, who has a number of business interests in the area and is a member of the Planning Board, suggested implementation of more of a hybrid tax for the town’s commercial village zones. Currently business owners in Centredale are up against some significant challenges, he said, and a tax rate somewhere between commercial and residential might be more appropriate and allow them to better compete in the marketplace.