2013 -- H 5930 SUBSTITUTE A

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LC02185/SUB A/2

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2013

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A N A C T

RELATING TO TAXATION - MAXIMUM LEVY

     Introduced By: Representatives McLaughlin, MacBeth, Phillips, Hull, and Bennett

     Date Introduced: March 27, 2013

     Referred To: House Finance

It is enacted by the General Assembly as follows:

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     SECTION 1. Chapter 44-5 of the General Laws entitled "Levy and Assessment of Local

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

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     44-5-2.3. Maximum levy -- fire districts. -- (a) In its fiscal year 2015, a fire district may

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levy a tax in an amount not more than five and one-half percent (5.5%) in excess of the total

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amount levied and certified by that fire district for its fiscal year 2014. In its fiscal year 2016, a

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fire district may levy a tax in an amount not more than five percent (5%) in excess of the total

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amount levied and certified by that fire district for its fiscal year 2015. In its fiscal year 2017, a

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fire district may levy a tax in an amount not more than four and three-quarters percent (4.75%) in

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excess of the total amount levied and certified by that fire district in its fiscal year 2016. In its

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fiscal year 2018, a fire district may levy a tax in an amount not more than four and one-half

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percent (4.5%) in excess of the total amount levied and certified by that fire district in its fiscal

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year 2017. In its fiscal year 2019, a fire district may levy a tax in an amount not more than four

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and one-quarter percent (4.25%) in excess of the total amount levied and certified by that fire

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district in its fiscal year 2018. In its fiscal year 2020 and in each fiscal year thereafter, a fire

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district may levy a tax in an amount not more than four percent (4%) in excess of the total amount

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levied and certified by that fire district for its previous fiscal year.

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     (b) The division of property valuation in the department of revenue shall monitor fire

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district compliance with this levy cap, issue periodic reports to the general assembly on

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compliance, and make recommendations on the continuation or modification of the levy cap on or

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before December 31, 2017, December 31, 2020, and December 31, every third year thereafter.

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The chief elected official in each fire district shall provide to the division of property and

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municipal finance within thirty (30) days of final action, in the form required, the adopted tax

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levy and rate and other pertinent information.

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     (c) The amount levied by a fire district may exceed the percentage increase as specified

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in subsection (a) of this section if the fire district qualifies under one or more of the following

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provisions:

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     (1) The fire district forecasts or experiences a loss in total non-property tax revenues and

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the loss is certified by the department of revenue.

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     (2) The fire district experiences or anticipates an emergency situation, which causes or

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will cause the levy to exceed the percentage increase as specified in subsection (a) of this section.

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In the event of an emergency or an anticipated emergency, the fire district shall notify the auditor

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general who shall certify the existence or anticipated existence of the emergency. Without

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limiting the generality of the foregoing, an emergency shall be deemed to exist when the fire

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district experiences or anticipates health insurance costs, retirement contributions or utility

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expenditures which exceed the prior fiscal year's health insurance costs, retirement contributions

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or utility expenditures by a percentage greater than three (3) times the percentage increase as

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specified in subsection (a) of this section.

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     (3) A fire district forecasts or experiences debt services expenditures which exceed the

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prior year's debt service expenditures by an amount greater than the percentage increase as

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specified in subsection (a) of this section and which are the result of bonded debt issued in a

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manner consistent with general law or a special act. In the event of the debt service increase, the

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fire district shall notify the department of revenue which shall certify the debt service increase

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above the percentage increase as specified in subsection (a) or (b) of this section the prior year's

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debt service. No action approving or disapproving exceeding a levy cap under the provisions of

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this section affects the requirement to pay obligations as described in subsection (d) of this

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section.

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     (4) The fire district experiences substantial growth in its tax base as the result of major

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new construction which necessitates significant infrastructure expenditures by the fire district or a

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significant increase in the need for fire safety services and such increase in expenditures or

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demand for services is certified by the department of revenue.

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     (5) The fire district is subject to increasing fire hydrant and streetlight fees, requires the

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purchase of fire apparatus, and/or firefighting and safety equipment, or the improvements or

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expansion of buildings, or the appropriate addition of personnel and such increase in fees and/or

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expenditures is certified by the department of revenue.

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     (d) Any levy pursuant to subsection (c) of this section in excess of the percentage

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increase specified in subsection (a) of this section shall be approved by the affirmative vote of at

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least four-fifths (4/5) of the full membership of the governing body of the fire district or in the

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case of a fire district having a financial town meeting, or its equivalent, the majority of the

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electors present and voting at the financial meeting shall also approve the excess levy.

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     (e) Nothing contained in this section constrains the payment of present or future

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obligations as prescribed by section 45-12-1, and all taxable property in each fire district is

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subject to taxation without limitation as to rate or amount to pay general obligation bonds or notes

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of the fire district except as otherwise specifically provided by law or charter.

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     SECTION 2. This act shall take effect upon passage.

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LC02185/SUB A/2

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO TAXATION - MAXIMUM LEVY

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     This act would make fire districts subject to the maximum levy.

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     This act would take effect upon passage.

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LC02185/SUB A/2

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