GENERAL ASSEMBLY SESSION A "PROFOUND DISAPPOINTMENT"

Printed in The Standard-Times, and NorthEast Independent June 17, 2010.
It will take weeks to sort out the details of what was and was not done during the frantic final two weeks of this year’s General Assembly session but my general sense is of profound disappointment. We did manage to come up with a state aid to education formula that doesn’t hurt North Kingstown, and a restructured personal income tax that should improve the state’s image but we passed some bad bills and failed to do many other things that are sorely needed. Here is a rundown of some of the bigger items:
THE BUDGET is being touted as “balanced” with no increase to sales or income tax, while implementing further pension reform. In reality, the budget creates a substantial loss for cities and towns by virtually eliminating the motor vehicle tax reimbursement program. That program allowed towns to exempt car owners from tax on the first $6,000 of value of their cars with the state making up the difference. Eliminating the reimbursement will cost North Kingstown $2.8 million/year. The town will either have to raise taxes or further cut spending to compensate. The long-sought management tools and relief from mandates that would help compensate for the loss never materialized.
The budget is “balanced” by assuming $100 million of Medicaid funds that have not been approved by Washington. Congress, faced with growing concerns about the national deficit, has delayed approving those funds and there is a real risk they will not be forthcoming. If the funds fail to appear, the Governor is authorized to rebalance the budget by instituting across the board reductions to offset the loss. As a practical matter, previous efforts to direct the Governor to make across the board cuts have generally failed when they ran up against entrenched spending programs. A mid-year change in administrations will make it even more difficult to take such steps.
Of greatest concern is the House Fiscal Policy Office’s own analysis that the budget “does not resolve the significant gap between available revenues and current service expenditures for future years. These are estimated at $321.8 million in FY 2012, growing to $484.6 million in FY 2015.”
I voted against the budget.
A STATEWIDE EDUCATION AID FORMULA. has been badly needed for years. After much negotiating, a revised formula was produced that will give North Kingstown roughly the same amount it has received in the past. This is quite an improvement from earlier proposals that would have cost almost $1 million/year. Several towns will still suffer substantial cuts so we should count ourselves as fortunate. The minimum aid for school construction will increase from 30% to 40% which will be a plus for our town. I voted for the formula.
INCOME TAX REFORM was achieved in a bill that greatly simplifies the personal income tax rules beginning in 2011. It reduces the highest rate from 9.9% to 5.99%. Instead of itemized deductions, individuals will be able to take a $7,500 standard deduction plus personal exemptions of $3,500. (Deductions and exemptions will phase out for incomes between $180,000 and $200,000.) Tax rates will be 3.75% on the first $55,000; 4.75% on the next $70,000; and 5.99% on everything over $125,000. The two higher rates are considerable lower than the 7 – 9.9% that previously applied to people in those brackets. Most people will see only small changes to their net tax liability but the lower rates will make us appear much more attractive to businesses and people thinking to relocate to RI. I voted for this change.
OFFSHORE WIND ENERGY I have long supported efforts to develop new sources of renewable energy – it’s good for the environment and, at first, appeared to create some exciting business opportunities for development at Quonset. The alarm bells went off last fall when Deepwater Wind submitted its proposal to the Public Utilities Commission for a “demonstration” project with eight turbines located close to the shore of Block Island. After months of sworn testimony and evidence submitted by expert witnesses the PUC denied the proposal in early April. Their written ruling included a scathing review of the project: saying it wasn’t worth the price and evidence of economic benefits was based on speculation.
Unsatisfied with the ruling, supporters of the project submitted legislation designed to circumvent the PUC ruling. I immediately opposed the legislation as a violation of due process, a battle in which I was eventually joined by the present and two former Attorneys General, the Conservation Law Foundation, Common Cause, Operation Clean Government and many others. After extensive effort we managed to force changes that at least put the case back before the PUC, the only group really qualified to pass on such matters. Unfortunately the revised legislation essentially places the PUC in a straight jacket in which it will have severely restricted ability to rule on the merits of the case.
As presently formulated, the Block Island wind project will only generate a small amount of electricity but will cost Rhode Islanders over $27 million/year and is of unproven economic benefit. We have heard testimony that abundant amounts of renewable energy are available from other sources for a fraction of the price. The resulting rise in electric rates will add to your monthly bill and the burden of companies trying to do business in Rhode Island. We need to continue to monitor this situation closely.
I am very disappointed in the willingness of my colleagues in the Assembly to push ahead with this project regardless of the evidence and well established methods for dealing with it. I debated the legislation at great length and voted against it.
THE EXPANSION OF GAMBLING at Twin River and Newport will be placed on the November ballot. Voters will have an opportunity to decide if the types of gambling at these locations can be expanded to include table games. (Update:the question was subsequently vetoed.) Personally I am not sure this would increase the actual dollars spent but it would offer a greater variety of ways to loose your money. This really is a different question from 2006 when you were asked about increasing the number of locations. I supported the bill to put the question before the voters, which is where I believe all major issues should be put.
GOOD GOVERNMENT took a beating. Efforts at reforms such as establishing an Office of Inspector General, greater access to public information and legislators’ voting records, and elimination of party lever voting all died silent deaths. The House passed ethics’ reform legislation but it stalled in the Senate. Conversely Senate efforts to restructure the Coastal Resources Management Council as required under the Separation of Powers amendment approved by the voters six years ago were given a brief hearing by the House and, once again, summarily rejected without comment.
They say that politics is the art of compromise but we have compromised too much. We must do better.