PROVIDENCE — Mayor Brett Smiley has proposed a hefty property tax increase to city homeowners and landlords, aiming to raise nearly $30 million.
To balance his $624 million budget, Smiley is also seeking to increase a slew of fees and fines — including parking tickets — and to trim department budgets and eliminate about two dozen jobs, most of which are already vacant.
The mayor submitted the annual tax-and-spending plan to the City Council on Wednesday evening. The council will vet the proposal over the next two months, and can make changes before passage.
“This year’s city budget was exceptionally difficult to balance,” Smiley said in an address to the City Council.
He said the city needed to “solve a generation of underfunding to the Providence Public School District in just one budget,” following a court settlement that requires city leaders to send $11 million more this year to the state-controlled schools, for a total of $147 million.
The property tax increase Smiley proposed, which totals $29.7 million, goes above the 4 percent cap allowed by state law, which would have been about $15.8 million. The state Legislature is currently considering a bill that would allow the city to go above the cap this year.
Residential homeowners and landlords will bear the brunt of the tax hike, because their property values soared in the recent reassessment of all city properties. The value of commercial properties increased to a lesser extent, and they will see a tax cut of $400 on average.
Multifamily homes saw the largest increase in value, prompting concern that rents will rise to cover the costs. Three-family homes, often known as triple-deckers, rose 50 percent to an average value of $663,000, up from $441,000.
The average tax bill for a multifamily home with two to five apartments will go up by 16 percent under the proposal, according to the city’s calculations. Single-family homeowners fare better, with a 4 percent increase that translates to roughly $160 more on average for an annual tax bill.
Here are the new proposed tax rates:
- $8.25 per $1,000 for owner occupied homes
- $14.40 per $1,000 for non-owner occupied homes
- $24.50 per $1,000 for 6-10 unit homes (new category)
- $27.75 per $1,000 for 11+ unit homes (new category)
- $28.80 per $1,000 for commercial properties
All of the proposed rates went down, accounting for the increase in property values. Smiley also proposed to create two new residential categories for buildings with 6-10 apartments and more than 11 apartments, which previously paid the commercial rate.
City staff said they could not under state law set the commercial tax rate to more than 3.5 times the residential rate. Smiley has repeatedly argued Providence’s commercial tax rate — currently $35.10 — is too high, discouraging developers and businesses.
Smiley is also proposing to increase property tax exemptions for the elderly and veterans.
The mayor’s address to the council was briefly interrupted by protesters who shouted into a megaphone that “the rent is too damn high.” They unfurled a banner over a balcony in the council chamber that said “lower the rent.”
Smiley, who opposes rent stabilization, responded by saying he welcomes the debate, before delivering the rest of his speech. City Council President Rachel Miller said she expects to unveil a rent stabilization proposal in the coming months to address skyrocketing housing costs.
The council will hold the first of two public hearings on the budget on May 6.
“I think the biggest thing that I and other councilors are going to be looking at is the impact directly on middle- and working-class families,” Miller said. “We’re taking about people who live in triple-deckers, which is so much of my neighborhood, and many neighborhoods around the city.”
Higher costs for parking tickets, dog waste and bulky trash pickup
The mayor proposed a slew of higher fines for scofflaws who park illegally or don’t pick up after their dogs, and added a new $10 fee for bulky trash pickup, which is currently free for residents.
Parking tickets for vehicles at an expired meter would go up from $25 to $40, while tickets for those parked beyond the limit at a non-metered spot would increase from $20 to $50.
The fine for overnight street parking, which is prohibited without a permit, would go up from $20 to $35. The fine for leaving your car on the street during an emergency such as a snowstorm would go up from $100 to $250, though an exception for city residents is being considered.
A full list of the proposed fees and fines was not immediately available. Smiley told reporters the goal in increasing the fees was not just to raise revenue, but to change behavior.
“It had gotten to the point where it was cheaper to get the ticket than to pay to park,” Smiley said. “I had friends that said, ‘I’ll just get a ticket instead of paying $30 in the lot.’ That’s a fee that hasn’t kept pace with the times.”
‘We had to make serious reductions’
No major budget cuts are being made to public-facing city services like trash pickup, recreation centers, or PVDFest, all of which were floated by the mayor if the tax increase is not approved.
The spending cuts he’s proposing total $9 million, roughly a third of which comes from an expected decrease in firefighter overtime, after the department hired new firefighters for the first time since 2018. Once the new class of 49 graduates from the academy, the city will have 456 firefighters.
Every city department will cut either its supplies or services budget, according to chief of staff Emily Crowell.
A total of 23 jobs will be cut, including an assistant city solicitor, the coordinator for the Ethics Commission, several clerks, a highway dispatcher and more. Most of the jobs were already vacant following a non-essential hiring freeze last year. Two employees will be laid off, Crowell said.
More money for immigrants, the World Cup and WaterFire
Smiley also proposed some increased spending, including a total of $55,000 for Dorcas International Institute to run a 24/7 immigration helpline for Providence residents, which launched on Tuesday. Dorcas, which has had to lay off staff due to federal funding cuts imposed by the Trump administration, provides legal services and supports to immigrants and refugees.
The mayor is also budgeting $250,000 for public safety during the World Cup next summer, predicting an increase in events and viewing parties while soccer games are played 30 minutes away at Gillette Stadium in Foxborough.
Smiley budgeted $69,000 for a new “nighttime manager” to help boost Providence’s night life while addressing noise complaints and other issues related to bars and clubs.
WaterFire Providence, the popular art installation on the Providence River that has struggled financially due to a drop in corporate sponsorships, would get a $50,000 boost for a total of $100,000 under the proposal.
Police officers will get a 4.25 percent pay raise and firefighters will get a 4 percent raise, per their union contracts. The union representing other city workers is in contract negotiations.
The mayor did not prepare a backup budget in case the Legislature does not approve the over-the-cap tax increase, his staff said. But the City Council has signaled approval for a tax increase that doesn’t exceed 8 percent of the current total tax levy. Smiley’s proposal is a 7.5 percent.
The overall proposed budget is an increase of $25 million, or roughly 4 percent, compared to last year. Fixed expenses, including an annual pension payment approaching $100 million, hamper the city’s ability to slash costs, city leaders frequently argue.
“Though we had to make difficult decisions this year, I remain hopeful and confident for Providence’s future,” Smiley said. “Amid the chaotic and hate-filled headlines that come from Washington every day, I want to reassure our neighbors that Providence is, and will remain, the safe, inclusive and welcoming city it is known to be.”
Steph Machado can be reached at steph.machado@globe.com. Follow her @StephMachado.