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Horse-Trading or Hostage-Taking? H. Philip West Jr, Guest MINDSETTER™

Tuesday, January 26, 2016


Contrary to the lofty lessons many of us learned in school about how bills become law, state legislatures routinely trade bills like horses—or hostages. Citizen advocates who hope to translate their visions into law must understand this ritual.

Rhode Island’s 2015 General Assembly session ended abruptly when the last dance between House and Senate leaders broke down. Scores of bills dropped into limbo: bridge repairs, charter schools, college funding, welfare fraud, lobbying, electronic voter registration, chicken coop size, medical marijuana, immunity for Good Samaritans in drug cases, and others.

Horse-trading may include compromises between different versions of bills or bills on entirely different topics. With lists in hand, House and Senate leaders meet behind closed doors to bluff and barter like merchants in a bazaar.

In August 1996, House Majority Leader George Caruolo leaned on the Senate to pass his Utility Restructuring Act. Caruolo wanted consumers to pay off $930 million in “stranded costs” to utility companies. His proposal prompted widespread opposition from energy experts, consumer advocates, and reform groups. James Malachowski, who chaired the Public Utilities Commission, warned that the legislation would raise electric bills, stall competition, and allow local utilities to reap windfall profits. (Within months, Malachowski’s salary got slashed, sending a shockwave message through state government: Never cross legislative leaders. Years after Malachowski left state government, the state Supreme Court ruled in his favor.)

To assure passage of Caruolo’s utility legislation, House leaders held hostage a high priority Senate bill by Cranston Sen. Thomas Izzo that would toughen enforcement of a ban on tobacco sales to children. Despite vocal objections during debate, senators approved Caruolo’s bill, which was duly stamped and marked. In an extraordinary gesture, then-Senate Corporations Committee Chair William Irons personally carried it across the rotunda and handed it to Caruolo, who then okayed final House passage of Izzo’s anti-smoking legislation.

In 1998, House leaders rammed through legislation sponsored by Deputy House Majority Leader Peter Kilmartin to create a Cancer Council: a nine-member board with “exclusive responsibility” for cancer research funds flowing into Rhode Island. Like Rhode Island’s scandal-prone Lottery Commission, the proposed Cancer Council would have had three members named by the speaker, three by the Senate majority leader, and three by the governor. 

Public opposition from the American Cancer Society, the RI Medical Society, Brown University Medical School, the Hospital Association, Lifespan, and Common Cause stalled the proposed Cancer Council briefly in the Senate. Despite numerous objections, House leaders demanded its passage, and only four senators dared to vote against it. 

In an eloquent veto message, Gov. Lincoln Almond wrote that he “wholeheartedly” supported the goals of “providing cancer care, research, prevention, detection, and education” but that he must veto the legislation “because its legislative appointment provisions violate the constitutionally-mandated separation of powers.”

The General Assembly never came back to override Almond’s veto, and Rhode Island’s 2004 Separation of Powers Amendment ended the centuries-old practice of legislative leaders naming members of boards that execute state laws. 

Legislative sessions often end with lobbyists trying frantically to move stuck bills. Senators and representatives fan themselves during stifling recesses while their leaders haggle over lists of bills each chamber wants passed. I once asked a legislative staff member who had attended these conclaves about the “horse-trading.”

“‘Horse-trading?’” He guffawed. “It’s hostage-taking.”

Citizen advocates—whatever their legislative goals—need to understand the tough bartering that overshadows the final hours of virtually every General Assembly session. During the rush toward adjournment, bills that range from trivial to historic wind up as chits on the trading table. 

While public pressure may win passage of needed bills before the final crush, significant bills inevitably become hostages. Citizen lobbyists must work with enlightened governors and brave legislators to help our General Assembly serve the public interest. That effort seldom ends before midnight on the last caffeine-fueled night of the session.

H. Philip West Jr. served eighteen years as executive director of Common Cause Rhode Island and is the author of “SECRETS & SCANDALS: Reforming Rhode Island, 1986-2006.”


Related Slideshow: 10 Things to Watch This General Assembly Session in RI

The 2016 Rhode Island General Assembly convenes on Tuesday January 5 - here are just some of the things to watch for in the upcoming session. 

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Statewide Teachers Contract

Critics of a potential statewide teacher contract are warning of implications should the state move away from district level negotiations, as a Senate committee is currently considering its potential and is expected to report on its findings in January,” wrote GoLocal in November.

“There are a lot of unanswered questions before anything could happen, so it certainly wouldn’t happen this year,” said Purtill. “I think there has been a lot of interest in the discussion, including NEARI, on how to make starting salaries competitive and some uniformity across the state so districts aren’t competing for teachers based on salary and benefits. State wide health care plan may be the logical place to start; keeping good quality health care benefits while lowering, or at least controlling the costs.  This discussion should also lead to how we attract people to the profession, including more minority teachers and those who want to teach in urban areas.”

At least one group, however, warned against the implications of a wide-reaching approach.  

“The Center believes there can be a state role in saving money for local school districts. Negotiating and offering a large group health insurance option, that local districts can choose to participate in or not - as opposed to a mandate that would surely be part of any statewide contract - is one such concept,” said Mike Stenhouse with the Rhode Island Center for Freedom and Prosperity. “Consolidating control over another large piece of our education and taking it away from taxpayers and local officials, however, we think that's dangerous.   We saw it with RhodeMap RI, and the fire unions, now we're talking about teachers -- it would tie the hands of municipalities through mandates.”

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Corporate Taxes

Last session, the General Assembly lowered the minimum corporate tax for businesses in RI from $500 to $450 — making it no long the highest in New England (the distinction goes to Massachusetts) but not as low as Vermont and Connecticut at $250.  

RI’s perennial placement on the Tax Foundation and other “worst tax climate” ranking has one business advocate calling for a much more drastic reduction in the tax. 

"To improve the business climate, the General Assembly needs to do three things," said URI Distinguished Professor of Business Edward Mazze. "(1) reduce the annual fee of $450  charged to businesses back to $50 whether they make a profit or not to encourage/support entrepreneurship, (2) make sure any new   economic development legislation or initiatives are transparent so that businesses can operate on a level playing field and (3) align the state’s estate tax exemption to the federal exemption amount to help family businesses and farms.

Whether or not the GA would make such a bold (and bottom-line) affecting move for a short term loss in hopes of long term gains seems like a reach, but as RI tries to improve its business climate, look for outside-the-box ideas.

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2016 is an election year — and casinos in Rhode Island are slated once again to put before voters in Rhode Island  This time, the Tiverton Town Council voted in November to allow legislators to put a local and statewide referendum on the ballot for a new casino proposal for the town - by Twin River, who purchased Newport Grand, and is now eyeing the the location.

Newport Grand faltered to gain approval in Newport (but got the statewide nod) the last two times it was put on the ballot to increased its offering from just slots to a full-scale table games casino.  Expect to see the legislation gain little objection from the rest of the state, as gambling opportunities increase in Massachusetts -- and the fear factor of loss of revenue in RI continues -- but the x-factor has always been at the local level.   

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Earned Income Tax Credit

Last session, the Economic Progress Institute pushed for an increase of the Earned Income Tax Credit — and saw it go up from 10 to 12.5 percent of the federal earned income tax credit.  And this year, it’s pushing for another bump.   

"Our legislative priorities include policy changes to help working families make ends meet by increasing the state's Earned Income Tax Credit to 20% from 12.5% and making child care more affordable by making the "exit income limit" permanent and raising the "entry income limit,” said EPI Executive Director Rachel Flum.

Last year, they had shot for 15% — and got the balance.  Could this year’s approach be another “big ask” to meet somewhere in the middle?  Stay tuned

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HealthSource RI

In 2015, Speaker Mattiello entered the General Assembly session wary of the cost of the state’s Obamcacare vehicle (“The General Assembly will ultimately have to make the decision as to if and how we fund it, through budget appropriations or through some type of fee,” said Mattiello at the time. “That's our jurisdiction.  If it's not efficient, we'll certainly look to turn it over to the Feds.”)

Mattiello hedged on an individual and small employee fee as proposed by last year by Raimondo, and Raimondo’s appointment of Anya Rader Wallack to head the agency has been moved to head up the state’s Medicaid office — the future is uncertain.  

“Obamacare exchange in Rhode Island limping along in need of more funding,” wrote Justin Katz for Watchdog in November

Wrote Katz, "HealthSource is a central piece of the state’s Unified Health Infrastructure Project (UHIP), which will link all government services and welfare programs through a single exchange. The state government is therefore sure to find some way to keep it under local control for another year, and then another. Under UHIP, with all services flowing through the same processes, the state might achieve some degree of scale, but perhaps more significantly, the exchange will just become part of the ballooning costs of social services in the Ocean State."

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Rhode Island House Speaker Mattiello Senate President M. Teresa Paiva-Weed have an A+ and A rating from the NRA respectively.  Even visiting the Rhode Island statehouse, it should be no surprise general assembly members will proudly flaunt their support of the NRA with posters and stickers hanging on their office windows, wrote Guest Mindsetter Matt Fecteau in November.

Governor Raimondo in a joint press conference with Senator Reed however called for “action to prevent gun violence” in October. 

“Gun violence is hurting our children and our communities, and we must commit ourselves to building safer neighborhoods and schools,” said Raimondo. “Thanks to Senator Reed, Rhode Island is a leader in taking a stand to reduce gun violence.  And while there is still much more work to do, he is committed to continuing to champion ways to reach across the aisle and build coalitions to make our communities safer.”

With renewed calls from gun control advocates to take action, Raimonodo’s pro-gun control stance will be at odds with the more gun-rights leadership. "Standing up to gun extremists" has been a focal point for Raimondo.  

"The gun extremists are at it again. There's a video going around Youtube comparing Gina to Hitler, Stalin and Pol Pot because she wants to implement a big, bold progressive plan for the state of Rhode Island -- one that includes a ban on military-style weapons," wrote her campaign

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In August, USA Today put out a list of “next states to legalize marijuana” — Rhode Island came in at number nine.  Massachusetts?  Number one.

Both states have legalized medical marijuana. Of RI, USA Today wrote the following:

Marijuana use in the small New England state is pervasive. An estimated 20% of Rhode Islanders aged 12 and up used the drug at least once in 2012. No other state in the country had wider use.

According to an April 2015 poll conducted by Public Policy Polling, 57% of respondents in the state support changing the law to regulate and tax marijuana similarly to alcohol.

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Drivers Licenses for Immigrants

Speaker Mattiello in the fall of 2015 warned Governor Raimondo not to usurp the legislative process by issuing an executive order to provide licenses to illegal immigrants in Rhode Island.  

In December, Coventry Representative Bobby Nardolillo questioned Raimondo’s intentions to "honor the legislative process should she decide to move forward with her campaign promise to provide drivers licenses to immigrants who are in Rhode Island illegally".

“The people’s voices are meant to be heard through their representatives and senators in the legislative branch of government. That is the appropriate place for this highly controversial matter to be debated and determined if the Governor chooses to act following the recent rally held by a group of self-proclaimed illegal immigrants demanding that she make good on her campaign promises,” said Nardolillo.

Raimondo has been on the record in support of the issue since her campaign.

"I was the first candidate in the gubernatorial race to explicitly call for drivers’ licenses for undocumented immigrants. This is an issue of fairness and public safety," said Raimondo in an ACLU questionnaire last year during the campaign.

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The prospect of truck tolls to fund an infrastructure bond — and how the plan is rolled out, and the reception it receives — is high on everyone’s list of uncertainties for the 2016 legislative session.  Having faltered on the last night of the 2015 General Assembly (after only being floated in May), the plan to fun a $500 million revenue bond came under public and political scrutiny throughout and the summer and fall, when the prospect of a joint fall session to address a now-defunct Providence stadium proposal — and tolls - fell by the wayside. 

All eyes are back on the General Assembly - with no PawSox distraction at this time — and with it being an election year, how elected officials grapple with funding much needed bridge and road repairs (with the Republicans continuing to advocate for a pay-go model), could have direct ramifications at the polls in November. 

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While at least one legislator called last year's budget the "Most Business Friendly Budget in Decades," other political watchdog groups begged to differ. 

"Every year, Rhode Islanders are making the decision to leave their state because it does not appear to be getting any better.  If they look at this budget, they see more debt (including municipal debt without voter approval), they see some refinancing wizardry, and they see one-time fixes," said Justin Katz with the RI Center for Freedom and Prosperity at the time. "Meanwhile, the instances of tax reform are so targeted that they're practically special interest give-aways offset by tax increases elsewhere."

"Although the Center appreciates that some principles around taxation, regulation, and freedom that we support are at least shuffled into the deck in small ways, with this budget, it is overall a bad deal for Rhode Islanders," continued Katz. "The fact that it passed the House so quickly and with such little debate should be seen as terrifying, not encouraging."

Now, the state awaits Governor Raimondo's second budget proposal as Governor, following taking credit for a FY15 budget surplus.

"Gina M. Raimondo today announced that the FY15 Preliminary Closing Statement, issued by the Department of Administration's Office of Accounts and Control, shows the state ended fiscal year 2015 with a $166.4 million General Fund surplus. General revenue expenditures were $21.5 million less than budgeted and general revenues were $23.9 million more than estimated," announced her office. 

"In my jobs plan, I made it clear it is time to reinvigorate Rhode Island and state government with fresh ideas and new ways of doing things so that we can enhance accountability, control costs, and get better results for our citizens," said Raimondo. "We're focused on improving efficiency within our agencies, modernizing our way of doing business, and increasing collaboration throughout state government - we're already seeing results. I am grateful for the work of all of my cabinet directors and all state employees on these efforts."


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