The Chafee Tax: Cut it Out Now

Thursday, March 31, 2011


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There was a time when it would have been hard to conceive of a way to get any closer to the heartbeat of life in local communities in Rhode Island than from the pages of the weekly community newspaper.

Though the online news gathering explosion has changed the landscape significantly, their commitment to the individual communities they serve remains steadfast.

Yet a community newspaper group, led by a seasoned fixture in the industry, was the latest recipient of the Team Chafee dismissal of critics who are challenging their controversial tax plan.

As first reported by, Beacon Publications owner and publisher John Howell, most prominently connected to the long-running Warwick Beacon community newspaper, is this week launching a unified ad campaign listing the names of all businesses opposed to the Chafee 6% Tax Plan. Yet the response given by Team Chafee speaks volumes of the arrogant disregard this Administration is showing toward critics of the tax. Chafee was quoted as saying, “Any time tax increases are proposed there will be critics….I am interested in constructive and credible criticism, which I have not heard yet….”

Really? In recent days, the names of those publicly joining John Howell’s ranks include: the Chairman of the state’s Convention Center Authority, David Duffy; the Executive Director of the state’s dominant, renowned theatre company, Michael Gennaro of Trinity Rep; and the President of the Greater Providence Chamber of Commerce, Laurie White. I wonder if these well regarded, seasoned figures from the state’s business and arts communities realize Governor Chafee doesn’t consider their criticism as credible? How long does the Chafee administration think they can keep this up? It’s going to get harder and harder in coming days for them to portray the growing chorus of critics as predictable partisan Chafee opponents.

All are articulating variations on the same point: Chafee’s proposed business-killing tax on a litany of everyday transactions, goods and services would have a devastating negative impact on the still wobbly Rhode Island economy.

Chafee’s curious response/challenge to John Howell and other critics was that he is “waiting to hear credible suggestions” which could replace the tax plan as a way of raising a projected $165 million the state needs in its overall budget package to plug a roughly $300 million deficit.

Well here’s a suggestion: I have tried to resist resorting to a turn of phrase on the overused James Carville line, but here it is: “It’s the pensions, stupid!”

Here’s some basic suggestions for the Administration: You can propose legislation using the Pfeiffer Report out of Central Falls as a framework to create across the board standardized pension benefits. You can propose state worker/ teachers/ municipal workers mandatory health insurance co-pay of 25% or even 30% going forward.

You can propose a bill or get behind legislation that’s already surfaced in years past to force a higher number of mandatory years of service before a pension kicks in—including for the ranks of police and firefighters as is being done in neighboring Massachusetts; and get behind existing bills calling for the elimination of COLAs. You can certainly start addressing a scale back of the outrageously outsized pension deals doled out to judges for too long now.

These types of proposals could certainly offset the $165 million associated with the projected tax revenue and result in substantial savings to the state and local communities in pension costs, which are projected to soar to $358 million in the coming year.

In recent days, it’s been reported that even the revered RI ritual of “beaching it” is targeted for fee hikes. The Administration better brace itself. If you think you’ve got their attention by taxing the repair bill on their road weary cars, wait until Rhode Islanders focus in on their beloved beach pass.

The voices of opposition are coming from every conceivable corner and Chafee and the General Assembly--will pretend they don’t hear at their own peril. Perhaps the best advice to the Governor can be summed up by taking a cue from the hair salon owners who have led the business organizing opposition effort. Governor, on your tax plan idea, please just cut it out.

Donna Perry is a Communications Consultant for RISC, RI Statewide Coalition


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