NARRAGANSETT – As the COVID-19 pandemic continues into the spring, and municipalities look for ways to adapt and bolster hurting revenue lines in this fiscal year’s pending operating budgets, the Narragansett Town Council is considering an increase in the annual rental registration fee for locally leased properties. Narragansett is home to many rental scenarios, from the large population of students from the nearby University of Rhode Island to frequent summer vacationers to the elderly, distinctions some councilors want taken into consideration as the fee increase is pitched in this year’s proposed $62.3 million budget.
The rental registration form is a mandatory document to be completed and submitted to the town on an annual basis by any property owner leasing local property for residential purposes. The form asks the owner a number of questions about the property and the nature of the lease, such as the address of the property in question, how many bedrooms are included on the property, the number of units, the type of rental (seasonal, year-round) and requires the signature of the property owner, among other information. Failure to submit the document can result in a $385 fine. Rental registration currently costs $85 per property and the form is good for a one-year period which expires every year in December. Narragansett is home to about 2,700 rentals, approximately a third of which are on a year-round basis.
In recent budget discussions, the town council considered an increase in the annual rental registration fee from $85 to $120 a year, resulting in a projected annual revenue increase of $93,905, according to town finance director Chris Spagnoli.
“I believe the rental registration should go up a bit,” said councilor Rick Lema. “My concerns are that we have places that rent multi units to people and most of those people are on the fixed income side. As we put a fee up, the landlord increases that rent, and they’re probably already up to their eyeballs trying to pay that. If there’s a number that can be worked with these year-round, multi units, where they would pay a flat fee, in other words, they would be in a flat fee scenario of so many units, flat fee of $3,000 or $4,000. If you calculated it with the new rate, and it came to $3,800, they would be at the $3,000 rate. We would try to help them a little bit so, again, they’re not increasing it on those year-round people who do live in town, support the community, spend their money here and are just looking to live here.”
“Whatever the fee is, I don’t have a problem with it, you can raise it to $120 or $150, but there’s a lot to look into here with multi units, pick a number and what we can do with them,” Lema continued. “Again, going through what we’re going through right now, we’re going to have some hard times on a lot of individuals and we’re going to need to be fair across the board. But I do believe the rental registration fee can go up.”
Councilor Patrick Murray in turn proposed basing the fee increase on the number of bedrooms of the selected property. The town council recently passed an emergency building moratorium for all new property and development in town, and instructed its community development department to draft proposed legislation that would seek to better regulate and reduce the number of local properties that are billed as single-family residences, only to be later converted into entrepreneurial ventures such as bed and breakfasts or student rentals. The council is expected to take up the community development department’s suggestions at a meeting in the near future.
Councilor Jesse Pugh advocated for the annual fee to be raised to $150 per rental property.
“I thought, over the years, that the [current] $85 rental registration fee is incredibly low,” he said. “I know it’s a big jump to go to $150, but I think it’s past due. I’m also for the per bedroom fee.”
Council president pro-tem Jill Lawler brought up the idea of distinguishing between the different types of local rentals, and working out a fee structure based on those differences. Lawler suggested separating the year-round rentals, typically reserved for seniors on a fixed income, according to the council president pro-tem, from the properties rented on a seasonal basis. Under Lawler’s vision, the annual rental registration fee would be completely waived for the year-round properties, and only the seasonal rentals would see an increase.
“That way, it encourages people who are living in these smaller places, they won’t have to have their landlord increase the rentals,” said Lawler in response to Lema’s point about property owners simply passing the fee increase onto tenants through rent. “If we could somehow make that money up in the seasonal rate, and give the year-round rentals a bit of a break, that would be something I’d like to take a look at.”
Council president Matthew Mannix agreed with Lawler, adding that making the distinction and not charging property owners who engage in annual leases might encourage more year-round rentals in town overall. Narragansett has struggled to attract families living in town full time, an issue that reflects in the local schools’ decline in local enrollment, which the school department has had to make up for by attracting out-of-district students with a variety of career and technical programs newly available at Narragansett High School.
Overall, in a recent council budget workshop, there was consensus to increase the annual rental registration fee to $120 per property leased in this year’s budget, with the council likely taking a wider look at the policy in the summer or fall. The council is expected to vote on its budget at council meetings on June 1 and June 15.