In Foster, Balancing Tax Revenue with Rural Character Isn’t Easy
Town seeks to change zoning on Route 6 to attract new business
October 5, 2023
FOSTER, R.I. – Driving on Route 6 in Foster, there’s nothing that alerts visitors that they’ve entered the town. It’s the sign telling drivers that they’re entering Connecticut that gives them an indication that they’ve already driven through Foster.
On the Foster section of Route 6, which begins in Massachusetts and goes all the way to California, there are some homes, a few businesses and bars, a solar array, and several vacant properties. But a proposed zone change currently being considered by the town council would allow more commercial buildings on Route 6 in an effort to revitalize the area and create more taxable assets in town.
The proposed zone changes seek a balance between lower taxes and retaining the town’s rural feel – an often-delicate line that rural towns must navigate between economic development and character.
Foster’s town planning board has proposed changing the zoning for 55 plots (all currently zoned differently) to a new designation, called Highway Commercial 2, referred to as HC2. While the changes to the map were already approved by the Town Council at its last meeting in September, the body still needs to vote on what the designation entails.
If passed, the new designation design standards would allow commercial (retail, service, office, manufacturing, industrial, and related activities), residential (single-family, multi-family, age-restricted communities, or homeowners associations), and agricultural use of the plots, according to the proposed zoning ordinance change.
Property owners have the option to change to HC2 or keep their current zoning.
Forty-five of the plots up for a zoning revision are on Route 6, 22 of which are now used for residential purposes only, according to a list of properties provided to ecoRI News by the planner and the town’s tax database.
Eleven properties are currently vacant or contain vacant buildings. The remaining plots are commercially zoned or mixed use (meaning they can be used for housing and business).
Changes to Foster’s zoning map ultimately come down to residents’ desire to keep taxes down while developing in a way that fits with the town’s current character, according to town planner Grant McGregor.
“It’s generally believed that people pay too much in taxes in Foster,” McGregor told ecoRI News.
According to the Rhode Island Public Expenditure Council (RIPEC), individual homeowners in Foster have a relatively high tax burden compared to other towns in the state.
A RIPEC report published in January 2022 shows that the tax burden for Foster homeowners with $319,000 in assessed property value was $6,807 a year, almost $1,400 more than the state median. Only homeowners in Coventry, Richmond, and West Warwick had higher tax burdens.
In Rhode Island, most towns’ largest revenue generator is property tax, but in Foster the burden of those taxes fall on individual homeowners, who pay a larger portion of property tax than their neighbors in other communities.
For example, in Exeter, the average resident pays less than the state median in property taxes and almost $2,000 less than residents with the same assets in Foster, according to the RIPEC analysis.
Before McGregor became the town planner last February, the town paid for an economic development strategy report to try to find ways to lower tax costs for residents.
The report, published in March, suggested making changes to the zoning and design of Route 6 “to direct development activity to existing underutilized parcels in an effort to improve appearance and diversify the tax base.” The plan explained that increasing the number of businesses in town would increase the total taxable assets in Foster and take some of the burden off individual residents, though it cautions that the town should consider how new business will create need for new services.
The town targeted Route 6 for redevelopment because it is the most traveled thoroughfare in Foster, McGregor said. About 9,000 vehicles travel on the road every day, according to the economic strategy report.
The strategy calls on the town to “improve the sense of place along commercial corridors by enhancing the overall appearance and aesthetic of the main entrances to the community,” which includes the entrance to town on Route 6.
The adoption of new zoning in the area would also come with modified design standards, which McGregor said would help balance the new development with a desire to keep the town’s rural look and feel.
The proposed ordinance change says that design should “break up the apparent mass and scale of large structures, and large paved parking areas, in order to ensure that such development is compatible with and does not detract from Foster’s character, scale, and sense of place.”
Some residents cited concerns about Foster’s character, vulnerability and economic viability under the proposed zone change at a Sept. 14 town council meeting.
State Rep. Gordon Rogers, a Foster resident, spoke in favor of the zone change, but said he wished that some of the roadway frontages could be decreased because the plot sizes and shapes made much of the area on Route 6 difficult to develop efficiently.
McGregor explained that frontage changes and distances from utilities have minimums mandated by the state.
Ronald Cervasio, the former planning board chair, agreed with Rogers that the zone change was a step in the right direction, but said it doesn’t go far enough.
“You’re broke,” he told the council. “You need money… that’s what this is about.”
Cervasio argued that the town needs to find a way to make the buildable acreage of the Route 6 lots bigger to help spur development.
Lynne Rider, also speaking in favor of the zone change, said she liked the frontage requirements outlined in the proposed zoning because it could help development happen while preserving Foster’s character “because the idea of developing Route 6 is, I don’t believe, to have it look like Route 2 in Warwick, or Route 5, where every single piece of land has been developed with no green space in between,” Rider said.
During the meeting, the council approved additional usages under the zone change, including breweries and distilleries.
“How are some of these businesses compatible with a rural town?” resident Paul Allen asked. “I think a lot of this has nothing whatsoever to do with a rural town, it’s just about making money. I think it’s any garbage you can get.”
In an interview with ecoRI News, Allen said that he was against the zone change, largely because of environmental concerns.
Allen said the change will have widespread effects throughout town, even though it is concentrated on Route 6. Pointing to the solar array, which resulted in the the loss of trees cut down to make room for it, he said that the planning board’s actions fit into a larger pattern of bad development strategy.
“When I look ahead [using] common sense, everything that I know, all of my analytical skills,” he said, “there won’t be a Foster, any really rural characteristics left here. It’s just going to be urban sprawl from border to border.”
“There might be some parkland saved here,” Allen added, “but it’s not going to be enough to save the species that we’re losing by destroying their forests.”
It’s not unusual for a rural town to seek a balance between character and tax base. Foster’s economic development strategy discussed Burrillville as a case study for trying to benefit both.
Burrillville’s residential and commercial tax rate per $1,000 of assessed value was $16.42, compared to $21.34 in Foster.
Foster’s own economic development strategy credits Burrillville’s creation of an industrial park, identifying redevelopment districts, and encouraging mixed use development for helping the town balance taxes and character.
“This issue always comes up,” Scott Millar told ecoRI News. As the current planning board chair for the town of Exeter and a senior policy analyst at Grow Smart RI, Millar has seen the issue come up in his day job and work as a planning official. “It’s a complicated issue.”
Officials “are sort of stuck between a rock and a hard place,” Millar explained, because while residents usually also feel the burden of state and federal taxes, they feel as though they have more agency over their local taxes.
Property taxes are also regressive (meaning people who earn less pay a higher percentage of their income), “so there’s good reason for people to complain about that,” Millar said.
Looking at Foster’s residential tax burden, as evaluated by RIPEC, Millar was surprised to see how high it was, compared to other rural communities.
Second homes, which are abundant in coastal rural areas such as Little Compton, can help increase the tax base and keep everyone’s share of taxes low. But Foster doesn’t have a large seasonal community.
Additional businesses can help decrease the tax burden, Millar said, but an extensive study out of Barnstable County in Massachusetts (which is comprised of several small, rural towns) found that “mom and pop” businesses tended to be the most efficient because they draw in new tax revenue for a community without being a large draw on resources, like big-box stores.
McGregor said that retail viability on Route 6 was deemed to be low, and so local manufacturing would be encouraged in the area if the zoning proposal is passed.
The town’s economic development strategy also offers a hypothetical look at what a 100,000-square-foot commercial building, assessed at $4 million, would save in taxes for individual households: about $15.
“It is important to note this assumes no other changes in the community and, in reality, additional commercial development would simply slow the rate of increase in the property tax levy and may not reduce the overall tax burden,” according to the notes on the scenario.
Open space, which Millar said doesn’t draw on resources, is another type of property that can keep taxes low.
A lack of guidance from the state is another challenge for local officials, Millar said. The state tends to focus on larger projects in which rural officials don’t get involved, leaving them on their own to figure out the right solution.
But even when the state does get involved, there is often a lack of trust between local government and the state. Foster was among several towns that vowed to create a rural association to push back on state policies that some locals felt impeded on the community’s character.
The Town Council could vote on the development standards for the new Highway Commercial 2 zoning as soon as Oct. 12.