Woonsocket Legislators Call for Fiscal Receiver

Woonsocket legislators would prefer a receiver step in and help right the struggling city’s financial problems rather than raise property taxes, according to a letter from them to Mayor Leo Fontaine.

“Significant and immediate structural reforms are needed to avert a financial crisis in our city and we respectfully request that as a first priority, our city’s leadership should request that a receiver be appointed,” said a letter signed by Sen Marc Cote and Reps Lisa Baldelli-Hunt, Jon Brien and Bob Phillips. The letter was also sent to Gov. Chafee, Treasurer Raimondo and legislative leadership.

While Reps. Baldelli-Hunt, Brien and Phillips supported the supplemental tax increase for their community yesterday before the House Finance Committee voted o the matter, they said it would be wiser to have a state-appointed receiver negotiate bills and contracts than tax residents more.

Baldelli-Hunt said she has discussed as much with state Director of Revenue Rosemary Booth Gallogly, who has been working closely with struggling cities in the state.

“A receiver has the leverage to make the adjustments that need to be made,” Baldelli-Hunt said yesterday after addressing the House Finance Committee about the supplemental tax increase. “I don’t want a supplemental tax bill to stand in the way of getting a solid plan in place.”

Baldelli-Hunt said she does not want Woonsocket to go into bankruptcy and feels that a receiver can help the cash-strapped city avoid that by renegotiating contracts with unions and implementing other cost-saving measures. She added that a receiver is a better option than a budget commission because it is easier for one person to make bold decisions than a five-member board.

Brien agreed, saying, “I think a receiver is ultimately what we need to do.” He also plans to submit legislation as early as today that would allow Woonsocket to borrow money from its pension fund to bridge its budget deficit. He said that would be a better option than adding an additional tax burden on residents.

Mayor Leo Fontaine also said the city should consider utilizing a receiver, but not before it implements to supplemental tax increase. “We can always go back to a budget commission or a receiver but we can’t go back to [a supplemental tax increase],” he said.

The House Finance Committee approved the supplemental tax increase yesterday after not acting on the matter for a week. Some legislators said the committee was waiting to vote until it had the endorsement of the Woonsocket delegation, which didn’t happen formally until yesterday. “We’ve been hearing different stories over the course of the week, “said Rep. Larry Ehrhardt, a conservative Republican from North Kingstown. “Sometimes they were for it and sometimes they were against it.”

Some said Baldelli-Hunt was using the issue to bolster her credentials against Fontaine in case she runs for mayor of Woonsocket, but she denied the allegation saying, “This has nothing to do with politics.”

Fontaine confirmed he had heard such rumors as well. “I hear the scuttlebut,” he said. “but I’d like to think that we’re all acting in the best interest of the people.”