WOONSOCKET, R.I. (WPRI) – Woonsocket residents are facing a tax hike this year as officials begin to acknowledge the city has been overcharging commercial taxpayers for years, Target 12 has learned.

The city is already poised to lose hundreds of thousands of dollars a year in revenue after one property owner got its assessment lowered, with other major taxpayers also fighting for reductions.

The Woonsocket City Council this week approved two settlements with commercial property owners, which were among several ongoing tax disputes that began in 2019 when owners saw their assessed values soar under then-Mayor Lisa Baldelli-Hunt.

City officials are now tacitly agreeing that those valuations were likely artificially inflated – sometimes by millions of dollars. The effect will be felt across the city.

“There’s going to be a tax increase, there’s no doubt about it,” Mayor Christopher Beauchamp told Target 12 on Thursday. He replaced Baldelli-Hunt after she abruptly resigned last November.

Beauchamp didn’t have an exact estimate for how much rates might rise, saying he’s meeting with his team over the coming days to figure out the specifics. But he said the disputes have to be addressed now or they will only become bigger financial headaches in the future.  

“Getting these matters behind us is the right thing to do rather than kicking them down the road,” he said, underscoring he’s only been mayor for six months. “We’re dealing with the circumstances we’ve been dealt with.”

Beauchamp had been serving as council president when Baldelli-Hunt stepped down amid a land-deal scandal first reported by Target 12. She cited health reasons at the time.

Now, multiple city leaders said they’re dealing with the fallout of decisions made under her administration, including the overvaluations of several commercial property owners.

“It’s not good,” Councilman Dan Gendron told Target 12. “Every taxpayer deserves an apology.”

Baldelli-Hunt did not immediately respond to a request for comment Thursday.

The newly approved settlements were struck with Woonsocket Mall LLC, which owns a shopping plaza on Diamond Hill Road, as well as three other companies that own properties throughout the city. As part of the Woonsocket Mall agreement, the city will have to pay back $500,000 in overcharged taxes to the owner.

The assessed value of the shopping plaza will also decrease 43%, from $16.7 million in 2022 to $9.5 million in 2024. That means the city will receive about $250,000 less in taxes each year.

“The house of cards that former Mayor Lisa Baldelli-Hunt built over her 10 years in office is finally being exposed for what it truly is – a web of deception and corruption,” Councilman Brian Thompson said in a statement. “It’s time for accountability and transparency in city government, and for those responsible for this mess to be held accountable for their actions.”

The disputes settled Monday are not the only ones happening in the city.

At least three other major city property owners -- Landmark Medical Center, Rhode Island Energy and Walnut Hill, a shopping complex right down the street from the Woonsocket Mall plaza that’s similar in size -- are also challenging the city over valuations.

Woonsocket stands to lose millions more in revenue if those disputes end similarly, which will likely complicate city leaders’ ability to balance budgets for years. Yet Beauchamp, who is running to win the mayor’s office in his own right this fall, said he’s optimistic the city is turning a corner.

He pointed to some rehabilitation efforts underway at some old mill buildings that could help boost overall tax revenue for the city and help offset the money lost from the overvaluations.

“Two, three years down the road, we’re going to get much more tax revenue from buildings that haven’t been living up to their potential,” he said.

If elected mayor in November, Beauchamp said he would always strive to “communicate, cooperate and compromise” with residents, businesses owners and other city officials on all matters, including valuations.

Council President John Ward -- one of two candidates challenging Beauchamp for the mayor's office -- said he’s been talking about the “terrible job” done by Baldelli-Hunt's administration since her team did a full revaluation of all properties in 2017.

“I am extremely concerned because there are two significant lawsuits yet unsettled that may represent a couple of millions dollars against past billings,” Ward said in a statement. If elected mayor, he said he would bring his expertise as the former finance director of Lincoln to help solve the city’s budget woes.

“I learned a lot about how to manage the proper work of property revaluations and tax assessment,” he said. “I will bring those skills to the job.”

Woonsocket state Rep. Robert Phillips, the third announced candidate for mayor, said he was “disappointed that this happened.”

He agreed with the councilors who pointed fingers at the past administration, arguing that “in order to keep getting elected” Baldelli-Hunt demanded more money from commercial and industrial taxpayers so she could hold the line on any tax hikes for residential properties.

“We all need to trust the people that we elect and the ones that are hired by those in charge,” he said. “This is one of the reasons why I am running, to bring honesty and integrity back to this office.”

Gendron, who served as mayor for a short period when the City Council temporarily ousted Baldelli-Hunt from office in 2022, said he’s hopeful dealing with this disputes now can get the city back into a positive financial position. But he acknowledged more settlements are likely coming.

“I think it’s going to continue to get worse,” he said.