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S 2453Property

Taxation - Levy and Assessment of Local Taxes

This bill allows cities and towns to waive overdue tax interest for commercial properties with a good payment history.

Signed into law69 Yea0 Nay6 Not voting
Population
Affected
15
Email Legislator
Introduced Feb 6, 2026Committee Senate Finance

Plain-English Summary

This legislation amends existing property tax laws to allow cities and towns to extend a specific financial courtesy to commercial property owners. Currently, municipalities can waive interest penalties for homeowners who miss a quarterly tax payment, provided the homeowner has a five-year history of on-time payments. This bill allows towns to offer that same one-time interest waiver (capped at $500) to owners of commercial properties who meet the same good-standing requirements. It essentially treats businesses with a good payment history the same as residents regarding occasional late payment penalties.

For younger readers

When people own buildings, they have to pay taxes to the town. If they pay late, they usually have to pay extra money as a penalty. Right now, if a family owns a house and pays late by mistake, the town can say "it's okay" and not charge the extra money, as long as the family usually pays on time. This new rule says towns can do the same nice thing for people who own business buildings, like stores, if they usually pay on time too. It helps business owners fix a small mistake without losing extra money.

Who & Where It Applies

Impacted groups
Commercial property ownersBusiness ownersTax collectorsCity councilsTown councils
Impacted communities
All

Constitutional & Fiscal Check

None Likely

Estimated cost
None
Estimated revenue
None

Bill Analysis

Both viewpoints
For Progressives
  • Supports small local business owners who may be struggling financially, allowing them to avoid punitive fees for a single administrative error.
  • Promotes community stability by helping to prevent financial strain on local enterprises, which helps maintain local employment.
  • Encourages a fairer tax system that recognizes and rewards a history of good standing rather than strictly punishing a one-time mistake.
  • Reduces potential revenue for cities and towns, which could otherwise be used to fund public schools, infrastructure, and social services.
  • Extends financial leniency to commercial landlords and property owners, a group that may not require government assistance as urgently as low-income residents.
  • Prioritizes relief for property owners over non-property owning residents who do not benefit from similar fee waivers on other municipal debts.
For Conservatives
  • Reduces the financial burden on business owners by eliminating punitive interest fees for minor administrative oversights.
  • Rewards responsible taxpayers who have a proven five-year history of on-time payments, reinforcing the value of fiscal responsibility.
  • Empowers local municipal governments to make their own decisions regarding tax administration waivers rather than enforcing a rigid state mandate.
  • Undermines the strict enforcement of tax deadlines, potentially encouraging a lax attitude toward timely payments among commercial entities.
  • Creates additional administrative bureaucracy for tax collectors and town councils to process and review waiver requests.
  • Allows for potential inconsistency in how tax laws are applied, as different towns may choose to enact or reject the ordinance.

Votes

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Full Bill Text

Changes to existing Rhode Island law · 2 additions

SECTION 1. Section 44-5-8.1 of the General Laws in Chapter 44-5 entitled "Levy and Assessment of Local Taxes" is hereby amended to read as follows: 44-5-8.1. Waiver of interest on overdue quarterly tax payments.

(a) Notwithstanding any other provision in this chapter to the contrary, any city or town may, by ordinance duly enacted, authorize a waiver of interest on one quarter’s overdue property tax payment and allow the remaining balance of taxes owed to be paid on a quarterly basis if all of the following conditions are satisfied by the taxpayer:

(1) The property subject to the overdue payment is the residence or commercial property of the taxpayer and has been for the five (5) years immediately preceding the tax payment which is overdue.

(2) The request for a waiver of interest is in writing, signed and dated by the taxpayer.

(3) The taxpayer has made timely payments of taxes to the city or town for the five (5) years immediately preceding the tax payment, which is overdue. The burden of proof of timely payments shall be upon the taxpayer.

(4) The bill for which the payment is overdue was issued less than two (2) years prior to the date of the request for a waiver of interest.

(b) In no event shall the waiver of interest on a tax bill exceed five hundred dollars ($500). Decisions of the tax collector shall be in writing and contain a notice to the city or town council. If the taxpayer receives an adverse decision from the tax collector, the taxpayer must pay the interest and may file a claim for reimbursement with the city or town council within ten (10) days of the decision.

(c) Any request for a waiver of taxes which meets criteria established by this section pursuant to a duly enacted ordinance shall be granted by the city or town.

SECTION 2. This act shall take effect upon passage.