Charlestown has very high municipal costs, according to new report

Highest per capita administrative cost in the state

By Will Collette

Our newly sworn-in, non-CCA Town Council majority has made a close review of Charlestown’s finances and fiscal management its top priority.

They may be aided in that effort by a new report released by the conservative RI Public Expenditure Council that compares the cost of municipal government in very sharp detail. While I dislike RIPEC’s right-wing slant and animus toward labor unions, I do trust their ability to collect and present the data.

Their report is loaded with useful charts and graphs that allow you to compare the 39 Rhode Island cities and towns across a wide range of categories.

During the CCA’s long reign over Charlestown, their constant refrain was to talk about how low Charlestown’s tax rate is. It is that, but only because the bloated values of waterfront property owned by non-residents give us a very large tax base. That large tax base has paid for the CCA’s spendthrift habits.

RIPEC data shows Charlestown’s taxpayers pay $1,818 each for non-education municipal services, well above the state per capita cost average of $1,593. The lowest per capita cost is $623 in Exeter, perhaps due to their unwillingness to pay for police or fire departments. The highest per capita is Newport at $2,762. [Figure 4, pg. 13]

RIPEC explains why Charlestown, Newport and other communities have such high costs in a footnote on page 14:

Those municipalities are: New Shoreham, Little Compton, Jamestown, Narragansett, Charlestown, Newport, and Westerly. Several of the state’s municipalities with the greatest property wealth may have greater per capita spending because they attract a number of non-full-time residents and/or visitors who are not counted in the U.S. Census but who nevertheless contribute to demand for local government services. Subsections on police and fire below contain a more detailed discussion of quantifying demand for local services. U.S. Census Bureau, 2020 Census Residence Criteria and Residence Situations.

This fact has long been evident and was the reasoning behind a 2011 push by Charlestown Democrats for a homestead property tax credit to offset the impact of the cost of services to non-residents. The CCA mobilized what I called the “Riot of the Rich” to attack and destroy the Democrats’ proposal.

But I think it’s time to rethink that decision. Note that Newport will be the latest of our peer communities to institute a tax credit for year-round residents with applications available on January 1. North Kingstown adopted a homestead credit last year and Narragansett a couple of years before that.

Other data in the RIPEC report made me twitch. I can’t explain the reasons why a number of Charlestown cost items are so high, other than to rely on RIPEC’s belief, above, that our high number of summer people cause them.

Take, for example, Charlestown’s cost for town administration. Our administration cost is $566 per resident, compared to the state municipal average of $223 and that of Cumberland, the lowest, at $106 per capita. That makes Charlestown the highest municipal spender per capita among Rhode Island cities and towns.

We rank first in two of the largest categories within administration: compensation at $202 per capita and operations at $255 per capita. Overall, there’s a big spread between Charlestown’s administrative costs and all other cities and towns that exposes issues that should be rigorously reviewed. [Figure 21, pg. 35, below]

Maybe the higher cost is due to the amount of staff time devoted to blacking out records requested by citizens under the state’s Access to Public Records Act.

Charlestown's administrative costs are at the bottom of the chart meaning the highest in the state

Charlestown is ranked in second place for the highest per capita spending on parks, recreation, and natural resources at $115 per capita, edged out by Jamestown's $122. The state’s municipal average is $47. The stingiest is Richmond at only $2 per capita. [Figure 28, pg. 45]

Obviously, the CCA’s frenzied purchases of vacant land for open space accounts for our high relative cost. And that’s without factoring in how each purchase subtracts the property tax the former owners were paying.

Our per capita spending on public works is fifth highest in the state at $366. Our neighbor South Kingstown is the lowest in the state at $90 per capita. The state average is $193.

This seems to be another cost item greatly affected by our summer people. The infrastructure that serves them during the summer must be maintained year-round. However, that doesn’t explain the extreme disparity between our costs and South Kingstown’s since they also have lots of summer people.

Charlestown’s public works budget doesn’t include water, sewers and in many cases, road maintenance within many subdivisions where homeowner associations are responsible for those costs. By contrast, South Kingstown does provide these services but at a much lower per capita cost burden.

Police protection costs Charlestown $429 per capita, the 7^th highest in the state. We also pay the 4^th highest police salaries in the state. Including benefits, the Charlestown police per capita average is $89,945. Westerly and Newport pay slightly more. The lowest in the state is Foster at $61,587. Block Island pays the highest at $132,933.

For calls for service handled by each officer, Charlestown ranks 4^th at 811.7 per officer. Newport is the highest at 1,129.7 per officer. [Figure 11, pg. 23]

We don’t figure into RIPEC’s analysis of fire-fighting costs since we don’t have a professional fire department. That’s a major factor in our CCA-heralded low tax rate.

I have no issues with the town’s rank-and-file staff nor with their unions. I’m OK with our high police costs since RIPEC’s data also shows they work hard for their money.

I do believe RIPEC’s data flags some issues that deserve the new Council majority’s attention to ensure we are getting value for our tax dollars. Our high costs for administration, public works, plus our spending spree to buy more open space deserve close attention.

While I appreciate our low tax rate, it seems obvious from the RIPEC data that this rate could and probably should be a lot lower. We’ve raised this issue before in articles on the CCA’s $3 million “oopsie” and the town’s failure to use the correct number of work days per year to calculate the town’s payroll.

Finally, I believe RIPEC has unintentionally strengthened the case for Charlestown to enact a Homestead property tax credit given the disproportionate impact of absentee property owners on municipal costs. As the new Council reviews the issue of fair taxation, a Charlestown Homestead credit should be on the table.