February 23, 2012

Residential Taxation in Rhode Island Municipalities, Part 2

Carroll Andrew Morse

In the previous post on local resident taxation in Rhode Island, there is a group of distressed communities (and Bristol?) at the bottom of the percentage-of-resident-income levied list. The clustering raises a question worth addressing of whether total income is the appropriate basis for measuring the taxation level in very poor communities.

The argument for adjusting the straight percentage is that there are certain fixed costs to human existence that are at least as important as paying your taxes and that taxation should be measured against what's left after basic necessities have been taken care of. The argument against is that an adequate adjustment has already built into a percentage metric, i.e. 5% of Central Falls' income would rank equally to 5% of New Shoreham's income on the straight-percentage list, even though it means much less money from Central Falls, and a further adjustment will open the divergence even wider.

I will calculate one version of a additional poverty adjustment, and present it along with the straight percentage measures going forward.

The Federal government annually calculates poverty thresholds based on family size. The Census Bureau's American Community Survey for 2010 includes a 5-year-based estimate of the number of households by number of household members in each RI community. Combining these two data elements, the amount of aggregate income needed to reach the Federal poverty threshold in each community can be estimated. Subtract that figure from the total estimated income in a community, and the result is estimated income above the poverty threshold.

The aggregate poverty thresholds alongside total community income for each Rhode Island community are listed below the fold in Table 3.

Using income-above-poverty-threshold as the percentage denominator does noticeably change the rankings. Pawtucket and Woonsocket, in particular, move up from the bottom of the list, though West Warwick and Central Falls stay about where they were...

Community Estimated
Residential Taxes
Est. Community Income
Above Poverty Threshold
%
New Shoreham $7,548,403 $43,156,924 17.5%
Westerly $60,068,382 $572,176,124 10.5%
Charlestown $22,344,774 $228,566,907 9.8%
Jamestown $18,226,276 $201,536,359 9.0%
Narragansett $41,330,974 $483,824,656 8.5%
Hopkinton $17,371,823 $205,331,075 8.5%
Smithfield $44,556,739 $540,793,934 8.2%
North Providence $55,663,407 $677,191,804 8.2%
Tiverton $32,555,171 $396,244,079 8.2%
Glocester $20,367,277 $248,135,004 8.2%
Barrington $52,531,961 $648,026,956 8.1%
Cranston $140,031,603 $1,731,101,472 8.1%
Warren $18,903,276 $242,159,186 7.8%
Foster $10,126,928 $130,700,587 7.7%
Scituate $18,898,836 $255,536,328 7.4%
Coventry $59,892,348 $816,146,172 7.3%
Richmond $14,284,170 $196,708,025 7.3%
Warwick $142,107,199 $1,962,582,789 7.2%
South Kingstown $59,666,885 $824,990,949 7.2%
East Greenwich $40,943,187 $567,021,673 7.2%
Little Compton $9,690,006 $134,548,069 7.2%
Providence $187,919,289 $2,645,403,886 7.1%
Burrillville $25,001,269 $352,665,391 7.1%
Middletown $31,522,496 $446,713,652 7.1%
Pawtucket $74,151,943 $1,067,974,255 6.9%
Johnston $40,940,330 $590,829,955 6.9%
Woonsocket $38,789,267 $563,406,119 6.9%
Portsmouth $41,832,221 $619,570,326 6.8%
Newport $48,915,879 $727,564,232 6.7%
North Kingstown $57,562,579 $859,563,071 6.7%
North Smithfield $22,118,882 $333,768,892 6.6%
East Providence $64,344,891 $996,042,498 6.5%
West Greenwich $11,254,689 $175,003,296 6.4%
Exeter $12,546,640 $203,667,786 6.2%
Cumberland $55,052,263 $905,804,162 6.1%
Lincoln $37,704,656 $640,511,273 5.9%
West Warwick $33,739,187 $574,321,052 5.9%
Bristol $32,574,555 $577,082,755 5.6%
Central Falls $9,700,424 $174,284,570 5.6%

So now we have half of a story: how much do local governments collect from their own residents, measured in two different ways. Next we'll add the other half, and look at how much governments have to spend on their residents...



Table3:

Community Estimated
Community Income
Community Aggregate
Poverty Threshold
Community Income
Above Poverty Threshold
Barrington $750,732,990 $102,706,034 $648,026,956
Bristol $711,183,782 $134,101,027 $577,082,755
Burrillville $451,319,085 $98,653,694 $352,665,391
Central Falls $290,465,616 $116,181,046 $174,284,570
Charlestown $280,245,735 $51,678,828 $228,566,907
Coventry $1,038,550,254 $222,404,082 $816,146,172
Cranston $2,230,900,024 $499,798,552 $1,731,101,472
Cumberland $1,121,847,892 $216,043,730 $905,804,162
East Greenwich $650,450,934 $83,429,261 $567,021,673
East Providence $1,310,121,561 $314,079,063 $996,042,498
Exeter $242,627,275 $38,959,489 $203,667,786
Foster $159,648,566 $28,947,979 $130,700,587
Glocester $310,049,498 $61,914,494 $248,135,004
Hopkinton $258,085,760 $52,754,685 $205,331,075
Jamestown $238,128,085 $36,591,726 $201,536,359
Johnston $778,402,833 $187,572,878 $590,829,955
Lincoln $777,803,670 $137,292,397 $640,511,273
Little Compton $158,047,920 $23,499,851 $134,548,069
Middletown $553,331,300 $106,617,648 $446,713,652
Narragansett $589,639,012 $105,814,356 $483,824,656
Newport $883,701,696 $156,137,464 $727,564,232
New Shoreham $50,670,812 $7,513,888 $43,156,924
North Kingstown $1,030,596,746 $171,033,675 $859,563,071
North Providence $896,195,164 $219,003,360 $677,191,804
North Smithfield $410,133,024 $76,364,132 $333,768,892
Pawtucket $1,534,520,064 $466,545,809 $1,067,974,255
Portsmouth $732,059,511 $112,489,185 $619,570,326
Providence $3,691,700,870 $1,046,296,984 $2,645,403,886
Richmond $244,582,548 $47,874,523 $196,708,025
Scituate $321,459,138 $65,922,810 $255,536,328
Smithfield $660,901,200 $120,107,266 $540,793,934
South Kingstown $990,620,148 $165,629,199 $824,990,949
Tiverton $501,504,180 $105,260,101 $396,244,079
Warren $313,342,830 $71,183,644 $242,159,186
Warwick $2,515,047,584 $552,464,795 $1,962,582,789
Westerly $723,623,972 $151,447,848 $572,176,124
West Greenwich $213,215,790 $38,212,494 $175,003,296
West Warwick $771,810,040 $197,488,988 $574,321,052
Woonsocket $833,687,012 $270,280,893 $563,406,119