Fung, Raimondo stay on attack in last debate

PROVIDENCE, R.I. (WPRI) – The two leading candidates for Rhode Island governor attacked each other fiercely and frequently during their final debate on Thursday night, lobbing charges and countercharges about everything from 38 Studios to pension funding.

Democrat Gina Raimondo and Republican Allan Fung clashed throughout most of the 60-minute debate, televised live from Rhode Island College on WJAR-TV before a boisterous crowd, as they sought to press their cases to the undecided voters who will likely decide what polls show to be a tight race. A third candidate trailing in the polls, Moderate Bob Healey, also took part.

Raimondo came out of the gate swinging, accusing Fung of misleading voters about his stance back in 2010 on the controversial 38 Studios deal, citing an unverified email that recently surfaced which appears to show Curt Schilling’s spokeswoman informing a 38 Studios board member, Tom Zaccagnino, that Fung would give the company tax breaks to move to Cranston.

The Schilling spokeswoman who allegedly wrote the email, Katie Leighton, told WPRI.com she could not confirm its authenticity, noting it would have been one of many she sent more than four years ago. “I don’t recall any of it,” Leighton said in a brief phone interview, adding: “I don’t even remember the name Mayor Fung.” Zaccagnino, the alleged recipient, has never responded to inquiries from WPRI.com over the years.

Nevertheless, Raimondo suggested the leaked email shows Fung had no qualms about the 38 Studios deal at the time that his fellow Republican, former Gov. Don Carcieri, and Democratic legislative leaders were putting it together. “The mayor’s been all over the place on this,” she said. “To me, he’s just playing politics, he’s saying whatever people want to hear to get elected,” she added.

In response, Fung repeatedly questioned the email’s veracity. “I think the viewers at home know that desperate times call for desperate measures, and this was nothing more than politics, because we have an unauthenticated email that came on the eve of the debate on the eve of the election that purportedly has these allegations in there,” he said.

At the same time, Raimondo pushed back at a ruling Thursday by The Providence Journal’s PolitiFact unit that argued it’s “mostly false” for her to claim she “fought” the 38 Studios deal. “I’ve been very consistent on this,” she said. “From the beginning I was very clear that I opposed this deal.”

Fung said he is the one on the side of the taxpayers now because he opposes using state money to pay off the roughly $90 million owed to bondholders who backed the 38 Studios deal, citing a lack of “due diligence.” Raimondo reiterated her position that the bonds should be paid to avoid tarnishing Rhode Island’s reputation in the credit markets, saying people “need to know their investments are safe here.”

The pair also exchanged fire – again – over Raimondo’s handling of headline-grabbing problems at Rhode Island Housing as a board member there and Fung’s handling of headline-grabbing problems at the Cranston Police Department as mayor.

Fung reiterated his sharp criticism of Raimondo over how she’s invested the state’s roughly $8-billion pension fund, noting that fees have risen to an estimated $70 million a year after she moved a significant portion of the assets into higher-fee hedge funds. “The general treasurer has shown poor judgment, poor performance – in the private sector she’d be gone,” Fung said. Raimondo said the fund’s performance and fees are in line with others. “The mayor isn’t telling the truth,” she said.

Raimondo tried to turn the pension discussion against Fung by noting that Cranston’s pension fund for retired public-safety officers remains severely underfunded despite a negotiated settlement he struck with retirees to reduce its shortfall. The most recent city audit shows its funding level rose from 18% in the 2007-08 fiscal year to 20% in 2012-13, with the shortfall increasing slightly from $228 million to $232 million.

“He hasn’t even made the payments into the system, the same thing that got Central Falls into trouble,” Raimondo said. City audits show Cranston has made 86% to 96% of the required annual payment since the 2007-08 fiscal year.

Fung said he did the right thing on pensions by negotiating a settlement and has put the fund on a path to stability, and argued that Raimondo had her numbers wrong: “How can you sit there with a straight face and make these accusations that are not true?”

On the economy, Raimondo and Fung both elaborated on the same proposals they discussed in the previous two TV debates – for Raimondo, a proposed Rhode Island Innovation Institute that would get colleges and businesses to partner on new products; for Fung, a proposal to cut state taxes by up to $200 million in the hopes of stimulating growth.

Pressed on the cost of their plans, Raimondo suggested the price tag of the institute to taxpayers would be “negligible,” though she admitted she would consider “finding a parcel or two of the 195 land and giving it away” for the project; the state purchased the land with borrowed money that still must be repaid. Fung remained vague on how he’d pay for his tax cuts in a time of big deficits, saying he would “find efficiencies in our budget,” possibly by targeting higher-paid state workers.

Healey criticized Raimondo’s plan for the institute, suggesting that creating a new organization ignores Rhode Island’s largest problem, the tax and regulatory burden on businesses. “I think that’s certainly wrongheaded,” he said. “We have a bad foundation and we’re going to put another story on top of it.”

Raimondo emphasized that unlike Fung, she opposes amending labor law in Rhode Island to make it a so-called “right-to-work” state, which has helped her avoid major union defections to the Republican this fall. “This is the core difference and core choice in this election,” she said. “I believe the only way to move Rhode Island forward is growth, and we cannot cut our way to growth.”

Fung said he’s maintained good relations with municipal labor unions in Cranston and said the “bottom line for me and my sole focus from day one of the campaign” has been finding ways to ensure more jobs are created in Rhode Island, which he said he will do “by creating a better business environment through that tax plan.”

Raimondo and Fung both said they support using standardized test scores as a high-school graduation requirement, though they emphasized the requirement must be designed correctly; Healey said he has heard too many concerns about doing that from teachers.

The candidates all said they support restoring full Ethics Commission oversight over members of the General Assembly, and Raimondo joined Fung in supporting term limits for state lawmakers, though she declined to specify how long they should be. Fung and Healey again said they favor a constitutional convention, which Raimondo opposes.

Raimondo said she supports granting driver’s licenses to illegal immigrants and opposes requiring state contracts to verify citizenship status through the federal E-Verify system; Fung said he holds the opposite positions on both issues. Healey said he could support requiring use of E-Verify and would give illegal immigrants a different form of driving papers.

Both Fung and Raimondo declined to say if they would keep Rhode Island State Police Col. Stephen O’Donnell in his job if they win, saying they aren’t making any personnel decisions until after the election.

Fung and Raimondo both said they would support eliminating taxes on retirees’ Social Security benefits but said the state needed to be able to pay for it. “It’s wrong – once we create a healthy economy with my plan, then we’re going to make sure that’s a key focus,” Fung said. Raimondo said: “We have to have economic growth to do it.”

Asked about their career mistakes in life, Raimondo said: “I was never a very good lawyer. So my time as a lawyer, I should have skipped that and gone right into building companies and businesses.” Fung said he has trouble “finding the right-work life balance” and needs to work harder at making time for his loved ones and friends. Healey said: “I have no regrets. I’ve lived a charmed life.”

The candidates are scheduled to hold one final joint appearance on Friday morning at a forum in front of the Greater Providence Chamber of Commerce. Their first televised debate was held Oct. 21 on WPRI 12, and their second one took place this past Tuesday.

The general election is Tuesday.

Ted Nesi ( tnesi@wpri.com ) covers politics and the economy for WPRI.com and writes the Nesi’s Notes blog. Follow him on Twitter: @tednesi

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