Bill
HB 6123
Central Falls classifies mixed-use commercial portions as Class 5 and fixes personal-property tax at $38.33 per $1,000, guiding local rates starting 07/01/2025.
Title: AN ACT RELATING TO TAXATION — LEVY AND ASSESSMENT OF LOCAL TAXES
Statutory change: Amends R.I. Gen. Laws § 44-5-20.02 (Central Falls property tax classification)
Status: Passed as Sub A; transmitted to Governor 06/23/2025; effective upon passage 07/01/2025 (effective without Governor’s signature)
Note on bill text: The bill file includes an earlier, unrelated highway/advertising draft that was superseded by Substitute A. The enacted substance is the Rhode Island substitute (LC002515/SUB A) amending Central Falls property tax classification rules.
Purpose and intent
- To (1) explicitly include the commercial portion of mixed‑use properties within the Class 5 (commercial) category for Central Falls, and (2) fix the tax rate applied to Class 3 (personal property) at a specified dollar-per-thousand value.
Key provisions
- Statutory amendment: Revises § 44-5-20.02, which governs property classification and tax rate structure for the city of Central Falls.
- Property class definitions (as restated/clarified):
- Class 1: Owner‑occupied residential dwellings of no more than five units (includes accessory land/buildings used exclusively by residents).
- Class 2: Residential properties of more than five units and non‑owner‑occupied dwellings (includes residential portions of mixed‑use properties and certain open space definitions).
- Class 3: Personal property (goods, chattels, effects previously subject to tax).
- Class 4: Every vehicle and trailer registered under state law.
- Class 5: Commercial property, expressly including the commercial portion of mixed‑use residential/commercial properties (new/clarifying language).
- Tax rate limits and change:
- The bill preserves the structure in which effective tax rates for Classes 2, 3, and 5 are expressed relative to Class 1, but adds language fixing the Class 3 rate at $38.33 per $1,000 of assessed value (i.e., a flat dollar-per-thousand rate for Class 3 that “remain at the fixed rate of thirty‑eight dollars and thirty‑three cents ($38.33) per one thousand dollars ($1,000) that was present at the passage of § 44-5-12.2”).
- Municipal option: The city council of Central Falls may adopt ordinances establishing classifications and rates based on the five classes.
- Administrative timing: Retains requirement that the Central Falls assessor submit certified lists of true cash value and classifications to the state Director of Revenue on or before June 1 (with a historical 1990 exception retained in the statute text).
Who is affected
- Property owners in Central Falls:
- Owners of mixed‑use properties (commercial portions now explicitly treated as Class 5).
- Holders of business personal property (Class 3), who will be taxed under the fixed $38.33 per $1,000 rate.
- Residential owners (Class 1 and 2) may see relative shifts depending on local rate-setting decisions.
- City of Central Falls officials: assessor, city council (rate-setting authority), and local tax administration staff.
- The state Director of Revenue (administrative reporting/oversight).
Potential impacts
- Tax incidence: Explicitly classifying commercial portions of mixed‑use parcels as Class 5 could change tax treatment and burden allocation between residential and commercial portions of the same building. Fixing Class 3 at $38.33 per $1,000 establishes a specific tax level for personal property; depending on prior practice, this could increase or stabilize business personal property taxation.
- Local budgeting and rate-setting: City council decisions under the statute remain important; the fixed Class 3 rate limits one source of flexibility.
- Administrative: Assessor reporting deadlines and classification responsibilities are preserved; municipal ordinances may need updating to reflect the clarified class definitions.
Effective date
- The act takes effect upon passage — listed as effective 07/01/2025.
Compiled from official sources — confirm details with the bill’s official record.
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