Rhode Island House to vote on nearly $10B state budget

PROVIDENCE, R.I. (AP) — Rhode Island’s House of Representatives is voting on a nearly $9.97 billion state budget.

House leaders say they’re hoping to vote Friday night but could adjourn for the day and return Saturday if the debate goes late.

The budget would expand the state’s pre-kindergarten program and add six new medical marijuana dispensaries, bringing the total to nine. It would create a board of trustees for the University of Rhode Island.

It does not include Democratic Gov. Gina Raimondo’s proposals for legalizing recreational marijuana, expanding the state’s free college tuition program, increasing the minimum wage or adding several new taxes.

Raimondo called the budget a “mixed bag.” She praised investments in pre-kindergarten and education, a top priority, but said she’s concerned it provides less funding than she requested for job training and economic development.

Here are some highlights:

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TAXES AND FEES

The budget proposal doesn’t include most of the taxes or assessments Raimondo proposed. She wanted to charge large companies based on their number of employees using Medicaid, which Democratic House Speaker Nicholas Mattiello said wasn’t in line with his goal of creating a pro-business budget.

Raimondo also sought to tax lobbying services, design services and services to commercial buildings, such as landscaping and janitorial work, too. House lawmakers nixed those plans, as well as proposed increases on tobacco products, but went along with Raimondo’s idea to tax digital downloads and streaming services, including Netflix.

They also did not want to raise beach parking fees but saw fit to raise campground fees. Rhode Island is also going to continue to phase out its car tax.

Mattiello said the House offset the revenue that would have been generated by the new taxes by not doing some of the proposed new programming, finding efficiencies and restricting departmental overspending.

The budget would eliminate the tax on feminine hygiene products. And it would create a $5 million annual fee on opioid manufacturers, aimed at compensating the public for the opioid epidemic.

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EDUCATION

The budget bill would add 270 to 300 more pre-K seats to the 1,080 that are already funded and provide additional state aid to municipalities for public schools. Mattiello said the budget invests very heavily in education, “as we should.”

It doesn’t maintain Raimondo’s proposal to expand the state’s free college tuition program, currently offered at the Community College of Rhode Island to recent high school graduates. Raimondo wanted to offer it to adult students at CCRI and cover the last two years of a four-year degree at Rhode Island College.

The budget would give URI its own trustee board. Currently the six-member Council on Post-Secondary Education oversees the state’s universities. URI President David Dooley says the school’s growing prominence necessitates a responsive board that thinks about finances, enrollment and research opportunities on a multi-year basis.

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MARIJUANA

Raimondo proposed to legalize recreational marijuana for adult use. Mattiello, however, said there seemed to be no desire among the public or lawmakers to legalize recreational marijuana this year, so House lawmakers decided to expand the number of medical marijuana dispensaries from three to nine instead.

Raimondo said the expansion of medical marijuana possibly lays the foundation for legalizing recreational marijuana in the future, and she’s fine with not legalizing recreational marijuana this year.

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ECONOMIC DEVELOPMENT

The proposed budget would change the way the Rebuild Rhode Island tax credit program provides financing for real estate development. Currently the Rhode Island Commerce Corporation can allocate up to $150 million in tax credits and sales tax doesn’t count toward the $150 million limit. Financing has been provided to about 40 projects for a total of $111 million in tax credits authorized since the program began three years ago, with a sales tax of about $40 million, according to Commerce.

The budget would allow for $200 million in tax credits over the life of the program but place the sales tax under the cap retroactively, according to Commerce, so the agency could do only about three more projects.

Commerce has sufficient resources, Mattiello said, noting that unemployment is low and revenues are stressed.

Raimondo had also wanted to expand the Real Jobs Rhode Island training program, with an additional $1.2 million. House lawmakers didn’t agree to that.

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OTHER INITIATIVES

The budget proposal includes an individual mandate that would penalize people who don’t have health insurance. The recommendation follows the expiration of the federal mandate that required people to obtain health insurance or face tax penalties. It was eliminated as part of the 2017 tax reform law.

Residents would have to get new state license plates with a design that is supposed to help with electronic tolling.

The budget would also remove to remove the city of Providence’s jurisdiction over zoning in the state-owned Interstate 195 redevelopment district. Mattiello and Democratic Senate President Dominick Ruggerio were upset with Providence Mayor Jorge Elorza for jeopardizing plans for a proposed skyscraper on the land.