Chapter 253

2005 -- S 0123 SUBSTITUTE A AS AMENDED

Enacted 07/13/05

A N A C T

RELATING TO TAXATION -- LEVY AND ASSESSMENT OF LOCAL TAXES

Introduced By: Senator June N. Gibbs

Date Introduced: January 25, 2005

It is enacted by the General Assembly as follows:

SECTION 1. Section 44-5-11.8 of the General Laws in Chapter 44-5 entitled "Levy and

Assessment of Local Taxes" is hereby amended to read as follows:

44-5-11.8. Tax classification. -- (a) Upon the completion of any comprehensive

revaluation or any update, in accordance with section 44-5-11.6, any city or town may adopt a tax

classification plan, by ordinance, with the following limitations:

(1) The designated classes of property shall be limited to the four classes as defined in

subsection (b) of this section.

(2) The effective tax rate applicable to any class shall not exceed by fifty percent (50%)

the rate applicable to any other class, except in the city of Providence; however, in the year

following a revaluation or statistical revaluation or update, the city or town council of any

municipality may, by ordinance, adopt tax rates for the property class for all ratable tangible

personal property no greater than twice the rate applicable to any other class provided that the

municipality documents to, and receives written approval from the office of municipal affairs that

the rate difference is necessary to ensure that the estimated tax levy on the property class for all

ratable tangible personal property is not reduced from the prior year as a result of the revaluation

or statistical revaluation.

(3) Any tax rate changes from one year to the next shall be applied such that the same

percentage rate change is applicable to all classes, except in the city of Providence.

(4) Notwithstanding subdivisions (2) and (3) of this subsection, the tax rates applicable

to wholesale and retail inventory within Class 3 as defined in subsection (b) of this section are

governed by section 44-3-29.1.

(5) Notwithstanding subdivisions (2) and (3) of this subsection, the tax rates applicable

to motor vehicles within Class 4 as defined in subsection (b) of this section are governed by

section 44-34.1-1.

(6) The provisions of chapter 35 of this title relating to property tax and fiscal disclosure

applies to the reporting of and compliance with these classification restrictions.

(b) Classes of Property.

(1) (i) Class 1: Residential real estate consisting of no more than five (5) dwelling units,

land classified as open space, and dwellings on leased land including mobile homes. In the city of

Providence, this class may also include residential properties containing partial commercial or

business uses and residential real estate of more than five (5) dwelling units. A homestead

exemption provision is also authorized within this class, provided however, that the actual

effective rate applicable to property qualifying for this exemption shall be construed as the

standard rate for this class against which the maximum rate applicable to another class shall be

determined, except in the city of Providence.

(2) Class 2: Commercial and industrial real estate, residential properties containing

partial commercial or business uses and residential real estate of more than five (5) dwelling

units. In the city of Providence, properties containing partial commercial or business uses and

residential real estate of more than five (5) dwelling units may be included in Class 1.

(3) Class 3: All ratable tangible personal property.

(4) Class 4: Motor vehicles and trailers subject to the excise tax created by chapter 34 of

this title.

tax rate on various classes as it shall deem appropriate. Providence shall be able to establish

homestead exemptions up to fifty percent (50%) of value. The calculation provided in subsection

(b)(1)(i) shall not be used in setting the differential tax rates. The tax rate for Class 2 shall not be

more than two times the tax rate of Class 1; the tax rate applicable to Class 3 shall not exceed the

tax rate of Class 1 by more than two hundred percent (200%).

(d) Notwithstanding the provisions of subsection (a) of this section the town council of

the town of Middletown may hereafter, by ordinance, adopt a tax classification plan in

accordance with the provisions of subsections (a) and (b) of this section, to be applicable to taxes

assessed on or after the assessment date of December 31, 2002.

(e) Notwithstanding the provisions of subsection (a) of this section, the town council of

the town of Little Compton may hereafter, by ordinance, adopt a tax classification plan in

accordance with the provisions of subsections (a) and (b) of this section, and the provisions of

section 44-5-79 to be applicable to taxes assessed on or after the assessment date of December 31,

2004.

SECTION 2. Chapter 44-5 of the General Laws entitled "Levy and Assessment of Local

Taxes" is hereby amended by adding thereto the following section:

44-5-79. Little Compton -- Property tax classification. – (a) The assessor of the town

of Little Compton shall make a full and fair cash valuation of all the estate, real and personal,

including motor vehicles and trailers, subject to taxation and determine the assessed valuation of

each property class as defined in section 44-5-11.8 of the General Laws entitled Tax

Classification.

(b) The town council of the town of Little Compton is authorized to apply, by ordinance,

a higher rate of taxation to Class 3 property (all ratable tangible property) beginning in tax year

2005 (values as of 12/31/2004); provided, that the tax rate applicable to Class 3 property,

notwithstanding the provisions of section 44-5-11.8, shall not exceed the rate applicable to Class

1 by more than two hundred percent (200%); and provided further, that any subsequent tax rate

changes thereafter shall be made consistent with the provisions of section 44-5-11.8.

SECTION 3. This act shall take effect upon passage.

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LC00669/SUB A

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