PROVIDENCE – Mayor Brett P. Smiley on Tuesday said the city's departments will now have to "do more with less" after signing the $624 million budget for fiscal year 2026.
The consensus package eliminates more than 20 positions, mostly vacancies the administration will cut permanently, said Smiley, who challenged city departments to provide the same level of service with less funding.
“Our hope is that city residents don’t see a decline in city services,” he said.
The budget approval process is typically completed by the beginning of the fiscal year on July 1. However, city officials delayed negotiations in anticipation of the General Assembly approving legislation allowing a one-year exemption to the total tax levy which permitted the city to increase it up to 8%, double the 4% allowed under state law.
The City Council on Monday ratified the amended budget proposal, which includes a tax levy increase of 5.85%, outlining a total tax levy of $401 million, an increase from the $379 million proposed in the previous fiscal year and a decrease from the 7.5% initially suggested by Smiley.
The budget approval process is typically completed by the beginning of the fiscal year on July 1, but city officials delayed negotiations in anticipation of the General Assembly approving legislation allowing a one-year exemption to the total tax levy which permitted the city to increase it up to 8%, double the 4% allowed under state law.
The administration says property tax bills, which are usually mailed on July 1, will be delayed this year.
Under the revised budget, non-owner-occupied properties with two to five units will face the steepest average increase of 6%. Single-family property tax bills will rise by approximately 4%, while commercial properties will see an average reduction of 2%.
Under Smiley’s original proposal, owner-occupied two- and three-family tax bills would have spiked 16%, which the council said “would have harmed tens of thousands of working families by overburdening mom-and-pop landlords and their tenants.”
On Tuesday, Council President Rachel Miller said this year’s budget formulation was “exceptionally tough” in part because officials were tasked with “making up for decades of underfunding schools in one year," citing the $15 million settlement with the R.I. Department of Education.
“In the face of rising costs for residents and for the city, we had difficult decisions to make to meet our obligations and protect core city services," she said.
The budget allocates funds to cover bulky trash pick-up fees and preserves funding for seasonal programming through the city’s Recreation Department. It also reinstates the sustainability policy associate position that had been previously eliminated from the mayor’s proposal, while removing the nightlife manager position and funding for noise cameras the mayor was seeking.
Moving forward city officials plan to look for new revenue sources wherever possible.
While Smiley said he’s opposed to revisiting previously approved tax stabilization agreements or payment in lieu of taxes deals with nonprofits, the administration will continue to push for hospitals like Care New England and Lifespan to kick in more money to city coffers.
“I don’t believe their payments are fair and equitable to the city,” he said.
Miller said among potential revenue sources sought after next year is state legislation to increase payments from nonprofits who purchase previously taxed property in the city.
“I think we have opportunities to work with the legislature,” she said. “Providence cannot afford to keep removing property from the tax rolls.”
Christopher Allen is a staff writer for PBN and can be contacted at Allen@PBN.com.
