Bill to increase car tax hits skids
“It would completely erase everything we’ve done in the last six months,” says Rob Cote, leader of the Car Tax Revolt, speaking of a bill that would require a uniform value of motor vehicles and include depreciation at a rate of 4 percent per year.
It would also establish a minimum value of $1,000 for any vehicle older than 20 years old and allow cities, towns and fire districts to increase tax rates and exceed the maximum levy for fiscal years 2012 and 2013.
However, Senator John Tassoni, who introduced the bill on Wednesday, said in a phone interview Sunday morning that he will remove the bill from the docket tonight. He also spoke to Cote via phone last week and informed him of his plan.
“After speaking to Rob and my colleagues, we’ve decided the bill is not what we’re trying to accomplish,” he said.
He also added, “This bill was not my idea. It was the Town of North Smithfield’s idea.”
Nevertheless, the bill was co-sponsored by Senators Erin Lynch, Marc Cote [no relation to Rob], James Doyle and Paul Jabour. In a phone interview yesterday, Lynch said she signed onto the bill by mistake and has since requested that her name be removed from the legislation.
“I had spoken to Senator Tassoni about a bunch of bills on the car tax issue and the bill I intended to sign onto was Senator [William] Walaska’s,” she said. “The last thing I want to do is cause the residents of the city of Warwick more burden with respect to their car taxes.”
Senator Cote also asked that his name be detached. In a phone interview on Sunday, he said, “I misunderstood the intent of the bill and was under the impression that it addressed the overvaluation of vehicles.”
Jabour and Doyle were also contacted. However, neither answered, nor returned calls.
Additionally, a Senate Resolution was introduced by Walaska and co-sponsored by Senators Lynch and Michael McCaffrey, which asks the Commission to re-evaluate how they set values to vehicles.
Moreover, Lynch said she spoke to Walaska about having it mirror the House of Representatives bill introduced by Rep. Joseph McNamara.
“We’re doing our best to keep the car taxes down,” said Lynch.
Walaska said raising revenue would be an issue if the legislation is passed. But, while he acknowledged that cities and towns would lose revenue, he said taxes need to be put forth in a transparent manner.
“If you’re going to raise revenue, you’ve got to do it the right way,” he said in a phone interview yesterday. “To have an unfair assessment is inappropriate. If a vehicle or home is worth a particular price, that’s what it’s worth and you don’t raise the value to raise more revenue.”
McCaffrey said he shares Walaska’s concerns about how vehicles are valued. He believes something must be done to rectify the situation, as citizens are outraged by the values.
“There are people who bought cars for less than what they are assessed at,” McCaffrey said. “People who have older cars didn’t have to pay any taxes on them for years and now they have to pay taxes on them. I think there should be a fair value.”
But Cote isn’t in favor of the resolution. He feels it conflicts with McNamara’s bill, as McNamara’s legislation requests that the Commission base motor vehicle valuations on the average trade in value as opposed to clean retail value, while he said Walaska’s tells the Commission, “figure out how you’re going to do it.”
“It’s a cut and paste of the Warwick City Council resolution requesting the Commission to design a more fair and equitable method of determining values,” Cote said via e-mail. “During the meeting held by McNamara on Jan. 4th, the Commission has indicated that they do not have the resources to design a change in the presumptive methods and that the proposals [I] put forth were sensible, easy to implement, and much more fair than the current system.”
Further, Cote has asked Walaska, Lynch and McCaffrey to abandon the bill and adopt the House version to give it clarity and continuity. He said, “The Walaska bill could be destroyed in a legal argument by a kid in the fifth grade.”
However, Cote said he is in favor of McNamara’s bill. In addition to amending car tax statutes so that the assessment of used motor vehicles is based on the average trade-in price of the car, it would also extend the appeal period on an assessment from 30 to 45 days and allow car dealers to set a value on vehicles based on average trade-in price, rather than the retail price. This method takes into consideration condition and mileage.
McNamara said he hopes the legislation will bring “fairness, accuracy and truth” to the valuation of vehicles and the local assessment of excise taxes.
“This is a good start on what I think will be a process that will correct this issue,” McNamara said. “I am very pleased that we were able to get this through quickly but I think part of it is the fact that I have a third of the members of the House signed as co-sponsors. It is an issue that has statewide support.”
Local co-sponsors include Rep. Robert E. Flaherty, Rep. Eileen S. Naughton, Rep. David A. Bennett and Rep. Frank G. Ferri.
While McNamara said there is a potential revenue loss, that’s not the main point. He believes constituents should not be taxed on assessments that are “inaccurate” and that when the government has unjust taxes, people start to lose their faith and support of not only the government, but also the taxing authority.
“I think the adherence to that duty is very important in a democracy and that’s something that’s not happening now,”
he said. “Someone came up to me [last week] and said, ‘My car’s a piece of junk and it’s appraised at $1,000. The only way it’s worth $1,000 is if I put my golf clubs in the trunk.’”
Cote said that while he’s happy with McNamara’s effort, the victory of having elected officials support him is bittersweet.
“It’s kind of a double-edged sword because the suggestions I made were only basic, fundamental common sense,” said Cote. “It makes me question why we have to make such a stink and go to great lengths for something that is so basic. Everybody scratches their heads and says, ‘Rhode Island is a mess and we have so many problems,’ but this is a derivative of that.”
Cote is yet to pay his car taxes in full and said he only paid the first quarter in order to make an appeal. But, whether or not the legislation is passed, he said it’s important to recognize the people who helped bring the issue to the attention of the general public. Last summer, he rallied more than 280 local residents to join him in the Car Tax Revolt.
“Everyone should say, ‘Look at what this handful of people in Warwick did,’” said Cote. “We shook up the whole state. People don’t mind paying their taxes but they don’t want to be ripped off. It’s not about me. I was only a mouthpiece. It’s about doing something that’s fair. We have to change the madness.”
A public hearing regarding McNamara’s legislation will be held tomorrow evening at the State House in room 35, which is located in the basement level of the building.