Little Compton council moves to seek state permission for 12% levy increase to cover $1 million shortfall

The Little Compton Town Council voted Tuesday to ask the Rhode Island General Assembly for permission to exceed the statutory 4% levy cap by 8 percentage points, a step the council and town staff said would allow the town to raise revenue equivalent to a 12% increase over last year's levy.

John McNamee, the town's interim finance director and business manager, told the council the town is facing a structural deficit of roughly $1 million and has exhausted the accumulated surplus the council used to balance prior budgets. "At this point in time, we don't have any additional accumulated surplus that we can use to fund the FY '26 budget," McNamee said, explaining why the administration recommends seeking relief from the state.

The council's motion, introduced at the meeting, directed staff to "take the necessary steps for the town council to exceed the statutory cap of 4% by 8% for a total increase of 12% and further to authorize the town council president to sign a resolution to the Rhode Island General Assembly seeking legislative permission to exceed the cap." After public comment and questions, the council voted in favor. The motion passed with "Aye" votes and no recorded opposition.

Why it matters: under current state rules the town may not increase the prior year's tax levy by more than 4% without statutory relief. Council members and members of the public pressed for more detailed budget documents before the formal town meeting, and the council agreed budget committee numbers would be made available before the public financial town meeting. Several residents urged the council to publish balance sheets, cash-flow statements and other financial schedules in advance so voters and councilors could review the math behind the proposed levy change.

What officials said: McNamee said the proposal is aimed at closing a structural shortfall created by rising expenditures and flat revenue sources; he said, "we we do have the levy from last year, which the 4%...we know what the 4% cap is. We know what the overall expenditures are. We know the shortfall at this point is roughly a million dollars." A resident asked for the numbers to be presented before any vote; town staff replied the budget committee meeting on May 27 would present detailed figures and that the administration would make the numbers available after the council meeting.

Next steps and constraints: council members noted the request to the General Assembly is a prerequisite for the state Department of Revenue to permit the town to proceed with a financial town meeting that would present the final levy and budget to voters. A town resident and several councilors emphasized that final approval by voters remains at the financial town meeting; council actions at this meeting were to seek state authorization so the ballot could legally include amounts that exceed the 4% cap.

Provenance: the council discussion and the motion appear in the meeting transcript beginning with the town's introduction of interim finance director John McNamee and his budget remarks (excerpted in transcript segments below). The motion text and the subsequent public comment and vote are recorded later in the same segment.

Ending: The council did not set a new mill rate at the meeting. Town staff said the mill rate will be calculated once valuations and the approved levy are finalized and that more granular fiscal schedules will be published for the public at the budget committee presentation and the financial town meeting.