Mattiello: Final RI budget will come out next week

Medicaid, transportation, pensions among key policies to watch in lawmakers' version

PROVIDENCE, R.I. (WPRI) – Rhode Island lawmakers will take up their biggest task of the year next week: passing a new state budget.

House Speaker Nicholas Mattiello said Monday that the legislature’s revised version of Gov. Gina Raimondo’s $8.6-billion tax-and-spending plan will be unveiled next week, setting up a final vote by mid-month. The one-year plan will cover the new 12-month fiscal year, which starts July 1.

“The budget will be posted for consideration by the House Finance Committee next week,” Mattiello said in a statement.

“That will give us time to review the testimony provided at Finance hearings this week on the new transportation article and the pension agreement, as well as to discuss budget issues in a Democratic caucus and continue to work with the Senate and the governor,” he said.

The new transportation budget article is the governor’s sweeping RhodeWorks infrastructure proposal, which was announced last week and which includes an effort to levy tolls on large commercial trucks. The pension agreement is a tentative pact with unions and retirees to end their legal challenge against the state’s 2011 pension overhaul. The caucus is a closed-door meeting of House Democrats set for Thursday.

The unveiling of Democratic General Assembly leaders’ negotiated budget deal always signals the final stretch of the annual legislative session. The document is the product of months of behind-the-scenes negotiations between the House, the Senate and the governor.

If past practice holds, the finance committee will unveil and immediately approve a revised budget late one evening next week. A week later the budget will go before the full House, which usually holds a marathon debate before approving it, and from there on to the Senate for a quick approval, before finally reaching the governor’s desk for her signature.

The budget-writing process became a bit easier for lawmakers last month, when the official number-crunchers determined they would have $173 million more to work with than expected thanks to higher-than-forecast tax revenue. That announcement led Raimondo to drop her proposed “Taylor Swift tax” on million-dollar second homes, among other changes.

State House observers will be watching a number of pieces of the budget closely to see whether lawmakers went along with the governor’s suggestions or went in a different direction:

• Medicaid: Raimondo has proposed $148.5 million in cuts to the state-federal health insurance program for low-income Rhode Islanders, which has become one of the fastest-growing parts pieces of the budget. A major plank of the proposal is to reduce rates paid to nursing homes and hospitals, while simultaneously moving to pay them based on quality of care. Lawmakers have been lobbied to undo the cuts.

• Economic Development: Raimondo has proposed a self-described “jobs package” of programs she hopes will spur economic development, ranging from new tax credits for real-estate development to a shift in how the state allocates tourism money that would boost statewide promotional efforts. Lawmakers have signaled general support for the ideas, which have strong backing from the establishment business community.

• Transportation: Raimondo waited until last week to announce RhodeWorks, her $4.8-billion plan to repair hundreds of roads and bridges over the next 10 years. About $700 million would be funded by a new toll – or “user fee” – on commercial trucks, which has the industry crying foul and asking for changes to protect local firms. While legislative leaders have expressed general support for RhodeWorks, they and the governor are examining carveouts for the local truckers.

• Social Security: Speaker Mattiello has made tax breaks for retirees a cornerstone of his legislative agenda this year, and as the man in charge of the legislative chamber that controls the pursestrings, he’s likely to get what he wants. While Raimondo’s budget already proposed eliminating income taxes on Social Security benefits for couples making up to $60,000, Mattiello wants to expand the exemption to higher-earners.

• Pensions: A tentative settlement to end a union lawsuit against the 2011 pension overhaul – which saved taxpayers roughly $4 billion by reducing state workers’ retirement benefits – is expected to win judicial approval shortly. The final step would then be for lawmakers to pass it, which they will likely do as part of the budget. The settlement would add about $290 million to Rhode Island’s roughly $4.8-billion pension-fund shortfall.

• HealthSource RI: Rhode Island’s state-run insurance marketplace, set up to implement President Obama’s health law locally, wants to add an assessment on health plans to fund its budget going forward. Some lawmakers have expressed wariness about the idea and say Rhode Island should switch to the federal HealthCare.gov system , but Raimondo supports keeping HealthSource.

• PawSox: There had been suggestions that lawmakers would use the budget to formalize taxpayer support for the new Pawtucket Red Sox ownership group’s proposed Providence stadium. But both Speaker Mattiello and Governor Raimondo have signaled in recent days that talks with the team have not progressed far enough for that to happen.

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

Comments are closed.