Amey Tucker Spencer Trust Fund Minutes
Monday, October 7, 2024, at 6:30PM
Town Council Meeting Opens
with Executive Session
Followed by
Amey Tucker Spencer Trust Fund Meeting
(Town Council Sitting in their Capacity as Trustees)
Town Council Meeting Reconvenes
Barrington Town Hall – Council Chamber
Video: https://vimeo.com/showcase/9672722
Attachments can be found: https://clerkshq.com/barrington-ri
Present: President Carl P. Kustell, Vice President Robert Humm, Councilwoman Berard, Councilwoman Conway and Councilman Braxton Cloutier
Also, Present: Town Manager Phil Hervey, Town Solicitor Mike Ursillo, and Town Clerk Meredith J. DeSisto
Department Heads: Police Chief Michael Correia, Fire Chief Gerald Bessette, Director of Public Works Alan Corvi, Human Resources Director Kathleen Taraian, Library Director Kristin Chin, Director of Planning, Building and Resilience Herb Durfee III, Recreation and Senior Services Director Jean Bellm,
Absent: Tax Assessor Jay Drew, No Finance Director (Kathy Raposa resigned August 6, 2024)
Council President Kustell called the meeting to order at 6:36 P.M.
President Kustell led us in the Pledge of Allegiance.
(Approved at the Town Council meeting on December 6, 2021, and was read into the record by President Kustell.)
“Aquene (Peace) We recognize the unique and enduring relationship that exists between Indigenous Peoples and their traditional territories. We acknowledge that we are in the ancestral homeland of the Pokanoket Tribe within the original territory of the Pokanoket Nation. We commit to ongoing efforts to recognize, honor, reconcile and partner with the Pokanoket people whose ancestral lands and water we benefit from today. Aquene (Peace)”
President Kustell announced the continuation of the public hearing regarding Ordinance 2024-3 and 2024-6 (Fireside Drive, Copper Kettle Lane) Chapter 179 because the Engineering Report has not been submitted; therefore, this will be continued to January.
· 42-46-5 (a) (1) Personnel – District Court Prosecutor
o The person or persons affected have been notified in advance in writing and advised that they may require that the discussion be held at an open meeting.
· 42-46-5 (a) Litigation: Sowams Road, enforcement action and potential boundary dispute re Tax Assessor Map 29, Lot 2 and Map 28, Lot 14
· 42-46-5 (a) Collective Bargaining:
o United Steelworkers, AFL-COP-CLC, Local 14845
o International Brotherhood of Police officers, Local 351
o International Brotherhood of Policer Officers (Dispatch), Local 555
o International Association of Fire Fighters, AFL-CIO, Local 1774
· Discuss Executive Session Minutes from April 1, 2024, and July 22, 2024, for placement on the next Town Council agenda to receive.
Motion by President Carl Kustell and seconded by Vice President Humm to move into Executive Session at 6:37 PM in accordance with RIGL: 42-46-5 (a) (1) Personnel – District Court Prosecutor - The person or persons affected have been notified in advance in writing and advised that they may require that the discussion be held at an open meeting. 42-46-5 (a) Litigation: Sowams Road, enforcement action and potential boundary dispute re Tax Assessor Map 29, Lot 2 and Map 28, Lot 14; 42-46-5 (a) Collective Bargaining:
o United Steelworkers, AFL-COP-CLC, Local 14845
o International Brotherhood of Police officers, Local 351
o International Brotherhood of Policer Officers (Dispatch), Local 555
o International Association of Fire Fighters, AFL-CIO, Local 1774
And to Discuss Executive Session Minutes from April 1, 2024, and July 22, 2024, for placement on the next Town Council agenda to receive. The motion passed 5-0-0-0 in favor, President Kustell, Vice President Humm, Council woman Berard, Councilwoman Conway and Councilman Cloutier; no one opposed, no recusals and there were no abstentions.
Motion by President Kustell and seconded by Councilwoman Berard to reconvene into open session and close the Executive Session at 7:44PM in which a vote was taken in Executive Session regarding Sowams Road as referenced on the agenda and that the Executive Session minutes are to be sealed. The motion passed 5-0-0-0 in favor, President Kustell, Vice President Humm, Councilwoman Berard, Councilwoman Conway and Councilman Cloutier; no one opposed, no recusals and there were no abstentions.
President Kustell said after the loss of our Town Prosecutor Lou Pulner, who passed away suddenly we have an excellent candidate after a long posting and public opportunity for top candidates to apply and said that we would like to make the following motion:
Motion by President Kustell and seconded by Vice President Humm to appoint Jason Knight and to direct the Solicitor’s Office to draft a contract between Mr. Knight and the Town of Barrington. The motion passed 5-0-0-0 in favor, President Kustell, Vice President Humm, Councilwoman Berard, Councilwoman Conway and Councilman Cloutier; no one opposed, no recusals and there were no abstentions.
Councilman Cloutier particularly called out this applicant, Jason Knight for not only his current practice, but his prior practices in the department of the Attorney General in which he has excellent academic qualifications. Councilman Cloutier said that he will serve the town well in his capacity and said that he is looking forward to having him represent us. The motion passed 5-0-0-0 in favor, President Kustell, Vice President Humm, Councilwoman Berard, Councilwoman Conway and Councilman Cloutier; no one opposed, no recusals and there were no abstentions.
President Kustell recessed the Town Council Meeting.
TOWN COUNCIL SITTING IN THEIR CAPACITY AS TRUSTEES
Present: (Town Council sitting as Trustees): President Annelise Conway, Vice President Braxton Cloutier, Trustee Kate Berard, Trustee Robert Humm, and Trustee Carl Kustell.
Also, Present: Town Manager Phil Hervey, Town Solicitor Mike Ursillo, Spencer Trust Administrator Karen Griffith and Town Clerk Meredith J. DeSisto
President Conway called the AMEY TUCKER SPENCER TRUST FUND MEETING to order at 7:45P.M.
Motion by Vice President Cloutier and seconded by Trustee Humm to approve the minutes of the Amey Tucker Spencer Trust Fund from September 9, 2024. The motion passed in favor 5-0-0-0 President Conway, Vice President Cloutier, Trustee Berard, Trustee Humm and Trustee Kustell; no one opposed, no recusals and no abstentions.
AGENDA #3 DISCUSS AND ACT: SENIOR TAX EXEMPTION
TM Comment: The Town Council has directed the Town Manager to work with Barrington resident Allan Klepper on his proposal to create a new tax relief program for “super seniors” who are elderly and have owned a home in Barrington for an extended period of time. His original proposal called for providing financial assistance to offset a portion of their tax bill through a “micro reverse mortgage” program where the amount of funding awarded to an eligible homeowner (no income requirement) would have to be repair, with interest, once ownership of the property changes (sale, death of owner, etc.). This proposal would have the Spencer Trust program act as a “bank” to fund the program. Assistant Solicitor Peter Skwirz has issued a memo based on this proposal that concluded that the “use of the Spencer Trust funds as a source of revenue to the Town in this manner may not comply with the restrictions on these funds and may be vulnerable to a legal challenge.” He followed up with me in an email that restated his concerns about not requiring an income-based application process:
I don't think we could use the Spencer Trust funds without an income restriction, even for 80+. I agree that in general this restriction would benefit those who are "house poor." But that would not necessarily be the case, and some of the Spencer Trust funds could ending up helping 80+ y/o people who are very well off, which would violate the terms of the Trust.
You could have a budget cap for the program in the manner Alan suggests and then provide up to the cap on a first-come first-served basis.
For some seniors, according to Mr. Klepper, a significant barrier to applying for the income-based senior tax exemption is the requirement to provide the Town with income documentation (such as tax returns). Mr. Klepper and I met with Mr. Skwirz last week and discussed a process that would allow for an income-based “super senior” tax relief program using Spencer Trust funds while reducing the barrier to access these funds related to the documentation requirement. Rather than require detailed income information, the Town could require an applicant to sign an “attestation” form that states their total household income is under the maximum amount set by the Trustees.
If the Trustees wish to proceed with this program, other questions include:
· What is the maximum household income for “super seniors” to access the funds? For one-person households, and for two-person households?
o The Town’s existing elderly tax exemption program is for homeowners who are at least 65 years of age. The highest income-based category, based on 2023 numbers, is the $74,176 to $77,400 category – qualifying for a tax exemption of $515.70. No household size is specified. Fifteen households qualified for this tax exemption in 2023, totaling $7,736.
o Elderly tax exemptions for households earning more than $77,400, or households that did not submit income documentation, received a flat tax break of $229.20. A total of 619 out of 929 total elderly tax exemptions were for this flat rate, totaling $141,875.
· How much should be made available per applicant? (Mr. Klepper suggests 10% of the overall average tax bill, which would total around $1,150 for this year. Another measure could be basing relief on a percentage of the median tax bill ($9,307; 10% = $930).
· What is the total allocation of Spencer Trust funds for this program?
· Other questions include:
o Use a minimum age requirement (such as 80)?
o Require a minimum number of years owning a home in Barrington? (5, 10, 20…?)
o Draw down the total allocation of funds (as Mr. Klepper suggests) based on the pool of the oldest qualified applicants?
Town Manager Hervey gave a further explanation with his above memo in which he was authorized to work with Barrington resident Allan Klepper on a proposal after he had submitted to create a new tax relief program for “super seniors” (residents older than 65 and have owned property for an extended period of time).
Town Manager Hervey said that Mr. Klepper’s original proposal as Mr. Klepper described was a micro reverse mortgage and that homeowners would get a certain amount from the Town’s Spencer Trust to help pay for their taxes and a lien would be placed on their property to be paid later with interest once the property changed hands. Mr. Hervey said that proposal was reviewed by the Solicitor but needed the applicant to fill out an income -based application to meet requirements of the Spencer Trust.
Town Manager Hervey stated that he reviewed other cities and towns in RI that provide a tax deferment option for elderly people 65 and over (East Greenwich). He said that people are hesitant in providing income documentation to the Town. Discussion ensued with application options.
Town Manager Hervey explained further that this would be an add on for qualified super seniors, on top of the existing senior tax exemption that is being paid out of our general budget.
President Conway said that she, Vice President Cloutier and the Town Manager met with Mr. Klepper to talk through the process. She commented that the Spencer Trust has benefited tremendously from the last few years of investment growth. (Spencer funds are not funded by the town, it is a private donation made in the 1920’s and has grown to a trust of approximately $6 million which is dedicated to the poor and unfortunate of Barrington and currently serves to fund a number of our nonprofit partners in the community (Meals on Wheels and EDCAP)); and out of the Spencer Trust we have an Emergent Fund.
Vice President Cloutier stated that we have been working on this for quite a while and the intent is to help our seniors, making sure that they can age in their homes and we want a program to move forward. However, we do not want to shift the burden to other residents of Barrington and we hope to use the funds from Spencer as it was intended.
President Conway suggested that this not become a micro loan and be a true gift from Spencer Trust. That there should be a minimum amount of years that the applicant has owned their home in Barrington – such as 10 years is a good balance. She said speaking of “super seniors” those over the age of 80.
Trustee Kustell said that the Spencer Trust is limited in that it must apply and benefit the poor and unfortunate of Barrington and asked Town Manager Hervey what is the approximate, or the estimated total cost of the town of the current senior exemptions.
Town Manager stated a little over $800,000, then with veterans’ exemption, disability and blind exemption which takes us over $1million from the town side. He said the Spencer side and what he would factor in to be consistent with the terms of the Trust would be that we have the income requirement in the attestation. He said there are people who can have very low income but very high wealth, and they wouldn’t quality as poor. We think that we would need to add an element of considering the wealth of the individual so that we are consistent with the Trust.
President Conway reminded all that the poor and unfortunate definition was made so that the Trustees would really have the ability to be flexible in whatever they defined as poor and unfortunate, that there is no actual income restriction – the attestation would be a way to attest that they are in a circumstance where they are cash strapped. She said that it is import to consider people may have a home that is valued at a significant amount, but they can’t pull down any of that income unless they sell that home. She said that the whole purpose of this is to help people age in place. She said that we would have to be reasonable as to what that wealth is defined as, is it cash, assets or liquid assets? She said we want to make sure we are not burdening the heirs or the super seniors when they leave their homes.
President Conway said that the other piece of this is the $800,000 includes anybody who is 65 and above where this would be 80 and above, which is a much smaller population. It also only includes folks who pay real estate taxes now, which means they have to own their home. It does not include any of the renters who live in some of the subsidized housing. Nor does it include the majority of our super seniors that actually live at Atria-Bay Spring and does not include any benefit. This comes down to about $121,000 in which we are talking about those over the age of 80 and their tax burden with some sort of income attestation.
Vice President Cloutier said we are well within the Spencer Trust budget of 5% and the numbers on page 2 and 3 of the Town Manager’s memo regarding the Spencer Trust.
Trustee Kustell said that he would like to confirm as to what we are legally able to do. He suggested that we draft and ask that the solicitor sign off in which that this would qualify as poor and unfortunate and under that definition include both income and wealth. If it is cash strapped, we have situations where we address that situation, but sometimes you have wealth that is not cash strapped and also not income. He said that we should draft it in a way that takes that into account making it consistent with the Trust. He said that he likes the direction that this is going in as long as we confine it to the terms of the Trust.
Discussion ensued regarding a proposed motion and to include the questions within the Town Manager’s materials. It was discussed that the draft motion has a few items but it is not all inclusive. The Council members suggested additional information:
· A minimum age requirement, we did discuss 80, because that would fall into the super seniors a minimum number of years owning a home in Barrington, we floated 10.
· And drawing down the total allocation of funds based on the pool of oldest qualified applicants from 80 to our oldest applicant.
· A budget number, $121,000
· Maximum household income looking at the highest income-based category in 2023 was between 74,176 to 77,400 and then just doubling that for a two-person household, with the understanding that many of these homes are one single person, about half.
Town Solicitor Mike Ursillo stated that his concern about the wealth element right now, under your senior exemption, which has already worked into your ordinances, there certainly is a sliding scale of income-based upon AMI et cetera. He thinks what we could do is put together something that includes something along those lines, as well as what is seen in other towns, and that part of that attestation is that there is not a trust out there or other assets that the individual can or is taking advantage of. Because, as you all pointed out this evening, we must stay true to the intent of the donor and make sure that we don't find ourselves someday with someone being defined as poor and unfortunate, but yet having a million-dollar trust. He said that he thinks the key will be in the language of the application, which addresses these wealth issues, and he is more than happy to take a shot at putting something together for your review at a future meeting.
President Conway questioned the solicitor that the current ordinance is income based, with exception of trust, or is the trust or trust excluded from the base?
Town Solicitor Ursillo said that looks like it's just income based. However, that standard, which is for town tax relief, is very different than the standard set forth by these monies (Spencer Trust).
President Conway said we had talked specifically about a trust, income and trust we want to be careful that we are not asking seniors to sell their homes in order to stay in their home, that their value can't come from their home. And additionally, what we heard from other seniors in the community as well as Mr. Klepper, was that some folks are simply uncomfortable stating their income in that way.
Vice President Cloutier said the reason why we came up with an attestation versus having someone have to come forward with their taxes or bank statements or things like that, was so that it could be more general, but with signing an attestation, you're still saying, “I earn less than this”, and so if it is discovered later, then you are still responsible for the fact that you signed this. But that's not true now. He said he thinks that is why we came up with the attestation, and now understand the wealth concerns, and think that is something that we should consider.
Alan Klepper, 3 Henry Drive, may I just add a few points, this is no longer a tax exemption, it is simply a grant, because the solicitor that we worked with said it can't be a tax exemption. That's why there's no payback. Another point, you are saying the limited age is 80 but the priority should be for the oldest person in town who is interested whatever people can put in and out. The application should be prioritized on an age basis, starting at the oldest. That was my whole function, initially, to see that the people who had been here the longest time the oldest people were taken care of, because, as I pointed out most are single women. And my original concept was, because you are going to earn, 5.4% close to $300,000. He continued with his comment that this should be based on 200 people, 200 families, or 200 residences, tax paying residences, and at the number that it would be given, what Jay drew gave me as the average tax levied was 1100 it went from 11,000 to 1146 or something like that. It would be $1,146 and you would set it up for 200 people, which, in that case, if you granted it would be almost $230,000 but you are going to earn close to $300,000 based on your 6 million what you're investing right now.
Motion by Vice President Cloutier and seconded by Trustee Kustell to direct the administration to provide a memorandum for the November 4 Spencer Trust meeting describing an income based “super senior” tax relief program that is a grant or gift that qualifies for the Spencer Trust funding to include the following,
· A copy of an attestation form provided by the Solicitor's Office,
· Spencer Trust budget scenarios based on projected income from the trust fund that includes funding for tax relief program and other items such as the administrative fees, the home repair program, agency support and administration and recommendations on household income requirements,
· And to include other questions such as minimum age requirement,
· A Minimum number of years owning a home in Barrington (10 years),
· Drawdown on the total allocation of funds, based on the oldest qualified applicants (80 to oldest), and
· Other items as discussed by the Council sitting as the Trustee:
o A budget number, $121,000
The motion passes, 5-0-0-0 in favor, President Conway, Vice President Cloutier, Trustee Berard, Trustee Humm and Trustee Kustell, no one opposed, no recusals and no abstentions.
TM Comment: The Housing Board of Trustees will present its recommendations to revise the terms of the Spencer Trust Downpayment Assistance Program. Housing Board of Trustees Chair Carla DeStefano presented potential revisions to the Trustees at the May 6th meeting.
Bill DeWitt, 4 Old Forge Road, member of the Housing Board of Trustees. Mr. DeWitt explained that Chair of the HBT Carla DeStefano prepared an outline of some changes that the board would like to make. He said that we believe we maintained the integrity of the Spencer Trust, but made it a little easier for people to take advantage of it, which was the task.
Vice President Cloutier asked is the reason why this money wasn't being used is because of the requirements, are there people who were previously in the pipeline, who didn't qualify? Who do you think will now qualify with these changes, if we were to approve these changes?
Mr. DeWitt stated that he does not have the answer to that question.
President Conway said her questions are related to the deed restriction. One of the reasons for the Housing Board of Trustees is to come into compliance with the state mandate of 10% and that's based on deed restrictions. How will that impact if we are relieving and voiding a deed restriction after 15 years for a resident?
Mr. DeWitt said technically it won't. It will count towards the state, and that is probably one of the biggest impediments. Instead of the way it was perceived before, of saying it's a deed restriction, you are going to take the funds and if you decide later you don't want to abide by that deed restriction, you have to pay the funds back, but at least it's a two-way door.
President Conway said but as the Housing Board of Trustees, and, as our responsibility as the Council is to get as close and to making progress towards the 10% deed restrictions because that is what will qualify as affordable housing. She said she fears that by removing the requirement for a deed restriction, we're actually moving away and potentially putting our housing stock at risk if we had someone stay for 15 years and then sell their home for a market rate versus a deed restricted rate.
Mr. DeWitt said the trade off, and we recognize that we would rather put somebody in an affordable house today, and maybe it doesn't count, but they are in the house, then not put people in houses.
Discussion ensued regarding the State’s goal of 10% for affordable housing in each community with some council members not positive that Barrington will get to the 10% even with special programs to attract home buyers.
Town Manager Hervey stated that he agreed that these programs have not resulted in any homes to be included in the data towards the 10% goals of affordable homes.
Discussion ensued regarding that the proposed adjustments is heading in the right direction. It was suggested to bring additional data back to the council for another meeting in November. The concern is how we are losing affordable housing stock very quickly and why deed restricting is critical which the 10% has been unenforced. The state is becoming more aggressive and it is very important that Barrington continues to move towards the 10% goal. The discussion continued regarding approximate 68 homes are owned by super seniors who are living in their homes that are valued under $400,000 but without a deed restriction and that the Housing Board of Trustees were charged with moving towards the 10% goal with keeping affordable housing in Barrington.
No action taken.
TM Comment: Please see memo from Spencer Trust Administrator Karen Griffiths Dieterich. I recommend revising the home repair loan terms as presented, to adjust for an increase in construction costs in recent years. The rules require an affordable housing deed restriction for Spencer Trust-funded projects that exceed $20,000. This amount is proposed to increase to $30,000, but we may need to revisit this in the future as applicants have not been willing to the deed restriction requirement, even before the recent escalation in home values.
Spencer Trust Administrator Karen Griffith said that we are proposing some updates to the forgivable loan maximums. The memorandum that shows the first chart shows the existing terms with a maximum loan of 20,000 for people with 80% of the area median income were below and the maximum loan balance of $5,000 for people between that 80% area median income and the 60% Barrington medium family income10-year proposing increasing those to a $30,000 maximum loan for the lower tier on a $7,500 maximum loan for the slightly higher tier. Then we did make corresponding updates to the grant amount and the 10-year forgivable loan in those cases where there might be deed restrictions.
Motion by President Conway and seconded by Vice President Cloutier to approve the amendments to the Home Repair loan program as presented. The motion passed in favor 5-0-0-0 President Conway, Vice President Cloutier, Trustee Berard, Trustee Humm and Trustee Kustell; no one opposed, no recusals and no abstentions.
PUBLIC COMMENT
Thomas Rimoshytus, 1 Howard Street asked for clarification regarding the tax exemption in which this is another avenue for a senior to go and nothing to do with taxpayer dollars.
President Conway explained that the loan is separate as it is a different avenue – a gift from Spencer Trust.
Motion to adjourn the meeting by Trustee Kustell at 8:26PM. The motion passed in favor 5-0-0-0 President Conway, Vice President Cloutier, Trustee Berard, Trustee Humm and Trustee Kustell; no one opposed, no recusals and no abstentions.
Meredith J. DeSisto, CMC