The Middletown Town Council approved a resolution Monday night to increase property taxes on non-resident owners and rental properties by 30%, sparking a heated debate over the fairness and impact of the change on housing affordability in the town.
The 6-1 vote will raise the tax rate difference between resident and non-resident properties. This means non-resident owners will pay $11.25 per $1,000 of assessed value compared to $8.65 per $1,000 for residents – a $2.60 difference.
“I’m going to support this because I do believe it does help the majority of residents,” said Council President Paul M. Rodrigues. “Even the residents, even like Oxbow or Northgate, that rent, even though they pay higher taxes, their taxes are likely to decrease.”
“I want to make sure renters are treated fairly and don’t have to pay out the nose to stay here,” Councilor Emily Tessier said.
“As we move the slide rule down, we force our residents to pay more,” Councilor Christopher Logan said, referring to the town’s split residential tax rate.
Councilor Dennis Turano was the sole dissenting vote, arguing the change unfairly burdens renters and will decrease housing affordability. He cited a Rhode Island Public Economic Committee (RIPEC) report advising against shifting tax burden to renters.
“This is going to have a negative impact on the affordability of Middletown to the renters and to the businesses,” Turano said. “Hundreds of properties are going to be taxed 50%. Their taxes are going to go up more than 50%. This is going to take $2 million from a portion of the community and give it to another portion of the community to lower their taxes.”
Resident Leon Amarant also spoke against the change during the meeting’s public forum.
“In a world of increasing and crippling housing unaffordability, that policy is actually really bad policy,” Amarant said. “The data that was in that article said that there’s going to be an average of $1,400 tax increase on those properties. So a $1,400 tax increase on a rental property increases the monthly rent by at least $100.”
The council had considered caps of 5-10% on the resident/non-resident difference in the past but ultimately settled on 30%. Some councilors suggested it could go as high as 50% in the future.
“When we put it in place, a lot of people knew it wasn’t a good thing to do, but we did it anyways,” Turano said. “I voted for it as well because I was told it was going to be a 5% token just to show our appreciation of you being a resident. I didn’t know it was going to be used to start shifting the tax burden.”
Other councilors argued the change is necessary to benefit the majority of Middletown residents who are homeowners and cannot pass on tax increases the way landlords can to their tenants.
The new 30% tax rate difference will take effect for the upcoming fiscal year. The council’s resolution comes as the town undergoes a revaluation of property assessments that some say has been an unfair process resulting in drastic valuation increases for many.
Watch The Meeting
You complain about unaffordable housing then you raise taxes by 30%. Where is the logic in that? you know the increase will be passed on to the renters.