Does Providence Owe Narragansett $16.7K or Does Narragansett Owe Providence $1.1M?

Do we have a test case, for bringing this session’s Supreme Court’s ruling in Tyler v. Hennepin County to Rhode Island?

In Tyler v. Hennepin County, in a refreshingly short 9-0 opinion, the Court ruled that when local governments seize property over unpaid taxes, they are only entitled to keep what was owed. So after Hennepin County in Minnesota seized Geraldine Tyler’s $40,000 home over $15,000 in unpaid taxes, it had a duty to return the difference of $25,000 to her. Or as the unanimous majority wrote in the conclusion of its opinion:

A taxpayer who loses her $40,000 house to the State to fulfill a $15,000 tax debt has made a far greater contribution to the public fisc than she owed. The taxpayer must render unto Caesar what is Caesar’s, but no more.

Now move over to Rhode Island and Antonia Noori Farzan‘s story in today’s Providence Journal:

Records show that the City of Providence could be at risk of losing Camp Cronin, its seaside camp in Narragansett, over unpaid property taxes.

The city spent hundreds of thousands of dollars to renovate the long-neglected Ocean Road property last year, but failed to pay the $16,721 that it owed in back taxes.

Consequently, the property went up for a tax sale in October. The lien was purchased for $17,006 by Airway Leasing LLC…

Under state law, Providence can hold onto the property if it pays off the lien – plus interest and any additional fees that the investors tack on – within a year of the tax sale.

If that doesn’t happen, Airway Leasing can foreclose and acquire the 2-acre summer camp, which is valued at nearly $1.1 million, for less than the price of a new Honda Civic.

There are multiple ways this could play out; Providence could pay the back tax bill, which it owes under any scenario, along with some reasonable expenses and close this out by-the-book. On the other hand, under the precedent set in Tyler, Providence could also say to Narragansett, hey we understand, you did what you had to do, and the matter can be settled with a check to cover the $1 million-plus that you now owe us.

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