The bill amends Section 44-3-3 of the General Laws in Chapter 44-3, focusing on property taxation exemptions for nonprofit organizations, particularly colleges and universities in Providence. It stipulates that unless any private nonprofit corporation organized as a college or university located in the city of Providence reaches a new memorandum of agreement with the city, the city shall bill the actual costs of municipal services supplied to said corporation, effective October 1, 2026.

The bill further defines "actual costs of municipal services supplied" as the total costs incurred by a municipality for services provided to a college or university, which includes police, fire, rescue services, and other services as determined by municipal ordinance. It also clarifies that services are considered provided to a college or university if they are delivered to property owned by the institution or to a property where at least one of its students resides.

Additionally, the bill establishes a framework for "memorandum payments" from nonprofit colleges and universities to municipalities. It defines these payments and sets a baseline, referred to as "memorandum payments baseline," which will increase annually based on the greater of annual inflation or a minimum of three percent. If an institution fails to meet this baseline during a state fiscal year, it will incur a tax equal to ten percent of its total revenue from the previous fiscal year, with the option for municipalities to increase this tax rate through an ordinance.

The act aims to ensure that educational institutions contribute fairly to municipal service costs, particularly in areas with student populations. The provisions will take effect upon passage.

Statutes affected:
1115: 44-3-3