House Approves Controversial RI Budget Despite Progressives, Enviro, and Taxpayer Group Opposition
Friday, June 23, 2017
The budget begins the process of eliminating the $134 million deficit and starts the first year of a six-year phase-out of the car tax, but sparked opposition from Progressive Democrats, environmental groups, taxpayer organizations, and of course, Republicans.
"We heard about all this cutting. But that [nearly] $135 million we talk about is a revenue shortfall, which happens when we don't get enough taxes -- which shows our economy is weak and struggling," said House Minority Leader Patricia Morgan. "But as far as cutting, we spent $300 million more this year than last year. The budget is built on one time revenues taken from sewer bills, electric gas bills -- all of these scoops."
Opposition, and Defense
Political and advocacy groups took issue with the budget, but the Speaker -- and Governor -- lauded its approval.
"Governor Raimondo and General Assembly Leaders have agreed to a budget that short-changes Narragansett Bay," said Save the Bay this week.
Progressive Democrats criticized the tax-and-spend legislation vehemently, stating, "Speaker Nicholas Mattiello’s budget, the annual revealing of wolves in Democratic clothing begins. This budget favors the rich and demonstrates a lack of concern for every Rhode Islander who is not so wealthy. The Rhode Island Progressive Democrats of Rhode Island continued:
T"his budget relies heavily on deep across the board cuts to state agencies--cuts that have not been clearly specified. When a budget refuses to detail openly and clearly exactly what the cuts will be, we are highly suspicious that services, wages, and benefits will suffer. After the brutal pension cuts, we are already seeing signs of decreasing functionality in our state agencies, with the ongoing UHIP debacle the most visible sign of the dysfunction. Further cuts will only lead to worsening performance."
The Speaker’s office defended the budget claiming it “raises the minimum wage, restores no-fare bus passes for low-income elderly and disabled people, includes a pilot program to provide two years of free tuition at CCRI and once again does not include any broad-based tax increases.”
“This budget accomplishes many goals that the people of Rhode Island have asked us for. It finally makes good on the promise to eliminate the excise tax on automobiles, which has been a priority for me because I’ve heard from so many Rhode Islanders who believe it’s an unfair tax. We’ve also restored free RIPTA passes for the elderly and disabled and included a portion of the governor’s free college tuition plan. We’ve done all this while cutting spending to close a $134 million shortfall, without raising broad-based taxes. This is a budget that doesn’t contain a lot of frills, but it does improve the lives of Rhode Islanders from all walks of life,” said House Speaker Nicholas Mattiello.
Further Critique, and Support
The Rhode Island Center for Freedom and Prosperity claims that the budget does not address the "massive structural budget deficits," the business climate or Rhode Island's 48th ranking on the Center's jobs and opportunity index.
"What does the average family have to cheer about in this budget? The few provisions that offer minor relief to some are overwhelmingly outweighed by the massive special interest and corporate welfare spending that will continue drag-down our state economy. Only when the total relief package is bigger than new spending can we claim that Rhode Island is heading in the right direction," said Mike Stenhouse, CEO for the Center.
“This was not an easy budget to accomplish, but it is a fair one. There were many tough decisions that had to be made, but we did so in the mindset of listening to the needs of Rhode Islanders. It will continue the progress we have made in previous budgets and I firmly believe it sets Rhode Island on a path of future prosperity and success," said Abney.
The House included a fraction of the Governor Raimondo’s proposal to provide two years of free tuition to students at state colleges. It will be a four-year pilot program to provide two years at the Community College of Rhode Island, with requirements that students maintain a 2.5 GPA and stay in Rhode Island following graduation. It also requires evaluation and reporting to the General Assembly on the effectiveness of the program.
As GoLocal unveiled on Thursday, a free diaper program for CCRI students who are parents with young children has a more stringent academic standards and has a means testing requirement.
Related Slideshow: FY18 House Finance Budget
The state's community college is poised to be the sole beneficiary of the Governor's Promise scholarship program.
It would make Rhode Island the fourth state to have tuition-free community college, allowing every resident the opportunity to earn an associate's degree tuition free. There is no means testing for the program and few standards.
The cost would be roughly $3 million in the FY18 (for the first cohort of students) and then $6 million the following year there are two classes.
As part of negotiations -- and the fiscal realities facing Rhode Island with a nearly $140 million shortfally, the Speaker announced Thursday that $25 million will be cut in general spending.
"It's something we discussed with the Governor and she thinks she can make [it] work," said Matteillo.
Also on the chopping block -- funding for the legislative office to the tune of $2 million.
Elderly and Disabled Bus Riders
After levying fares on some of the most needy RIPTA bus riders (the elderly and disabled) for the first time this past year, which resulted in strong public outcry, the House Finance budget contains just over $3 million -- for each of the next two years -- to refund the program this coming year.
Mattiello noted that after the two years is up, it is up to the Governor to find the funding.
On Thursday, Raimondo learned she is poised to get a piece (jCCRI) of her free college tuition proposal, which had been a major focal point of her budget proposal - and political strategy.
On the flip side, she is tasked with finding $25 million in government spending to cut, in order to balance the budget.
Unlike the May estimating conference, where Rhode Island revenues were found to be off nearly $100 million plus, the Governor can't say she didn't see this coming.
Medical Marijuana Expansion
In June, Raimondo called for an increase in medical marijuana dispensaries and an increase in licensing fees to generate $1.5 million in revenue for the state.
She called for "no less than six licensed compassion centers."
On Thursday, Mattiello said it was not in the budget, due the proposal's late timing.
While Mattiello made scant mention of cuts in the briefing Thursday - save for the $25 million out of government spending -- the question was raised as to where the rest of the $140 million shortfall will come from.
"Millions in cuts came from the Commerce Corp budget. The budget kept the Rebuild RI funding, but money for several other Commerce programs were reduced," said Larry Berman, spokesman for Mattiello.
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