On Thursday, August 15, a complaint was filed in Superior Court (CA No.: PC -2013-4082) by myself and other Woonsocket taxpayers challenging the legality of the City of Woonsocket’s $2.5 million supplemental tax related to fiscal year 2012-2013 that was levied at the direction of the Woonsocket Budget Commission.

The complaint is self explanatory. However, the essence and motivation behind the court challenge are as follows:

The $2.5 million supplemental tax for FY 2012-2013 (due and payable on August 29, 2013) results in the city’s collecting $5.0 million more from its taxpayers over the next 12 months than it would otherwise be able to collect in its absence (i.e., $2.5 million supplemental tax related to FY 2012-2013 plus $2.5 that gets built into the base levy for FY 2013-2014).

The supplemental tax was sized pursuant to the Budget Commission’s five-year plan (summary attached), which, in addition to the $2.5 million supplemental tax, called for $9.1 million in savings in FY 2013-2104.

The intent was that there would be shared sacrifice among the various stakeholders: taxpayers, employees, and retirees. With that intention in mind, the General Assembly explicitly made the supplemental tax “contingent” upon the “realization” of “savings” resulting from certain actions (e.g., contract concessions and enactments).

The enabling legislation did not make the supplemental tax contingent upon “anticipated” savings or “projected” savings or “budgeted” savings or “savings to potentially be realized in the future”; rather, the General Assembly purposely and explicitly made the supplemental tcontingent upon the “realization” of savings — thus requiring actual/real performance relative to savings, as opposed to hoped for or planned performance.

On July 8, the Budget Commission elected to issue the supplemental tax based $4.7 million of “projected” savings (see Exhibit 1 of complaint). Not only were the savings not yet realized (rather, they were projected), but the $4.7 million of savings they are claiming fall far short of the $9.1 million contemplated in their five-year plan.

As of today, and of the date in which the Budget Commission elected to issue the tax (July 8), there is no agreement with the police union, no agreement with the firefighters’ union, and no definitive agreement with the retirees. (Retired Police Officer Glen Hebert is currently challenging in Superior Court [CA 13-3180] the Budget Commission’s “enactments” related to his retiree healthcare.)

Thus, if the supplemental tax goes unchallenged, the taxpayers will get hit with 100% of the taxes that were contemplated in the five-year plan while potentially receiving only 51% of the savings that were contemplated, and in fact, based on the retiree challenges and union grievances, the savings to be realized will likely be far less than even $4.7 million that they are currently claiming.

Without challenge, the taxpayers will likely face another supplemental tax next year due to the Budget Commission’s failure to realize the savings they themselves said they needed per their five-year plan.

Based on the city’s and the Budget Commission’s history of failures in achieving meaningful savings, we will not sit back and allow their actions to once again go unchallenged.

Again, the Budget Commission is issuing a supplemental tax based on “projected” savings as opposed to the “realization” of savings, as is required by the enabling legislation. Our issue is not the tax per se, but rather the timing of the tax relative to the required realization of savings.

We filed the suit requesting class action, which must be approved by the courts. However, if there are taxpayers who would like to join the suit as named plaintiffs to ensure that their interests are protected, they are more than welcome to join.

James Cournoyer is a resident of Woonsocket, Rhode Island.