PROVIDENCE, R.I. (WPRI) – From an increase in state aid to changes to the car tax, Providence Mayor Jorge Elorza delivered a laundry list of requests to the General Assembly earlier this year.
So how did the new mayor do in his first year working with the House and Senate?
Here’s an overview of Elorza’s scorecard.
(First, though, it’s worth noting that Elorza’s biggest victories might have come from several bills that went nowhere. Legislation that would have required fire department platoon structures to be negotiated as part of collective bargaining agreements and another bill that would have required that firefighters be paid overtime for working more than 42 hours in a week both failed after municipal leaders held rallies at the State House. Then there was legislation sponsored by Senate Majority Leader Dominick Ruggerio that would have awarded tax breaks to developers on the vacant I-195 land without city approval; the bill won support in the Senate but was never introduced in the House. State and city leaders later settled on a revised proposal that mostly keeps the city in control, but offers a more predictable plan for developers to build on the former highway space.)
1. A small increase in state aid.
There’s good news and bad news here. Under Governor Raimondo’s budget proposal, Providence would have lost $2.5 million in aid through the state’s payment in lieu of taxes (PILOT) program. The good news is that the House restored the entire cut and gave the city an extra $1 million in aid, for a total of $3.5 million above what the governor proposed. The bad news is that the city budget Elorza signed into law called for Providence to receive $5 million more than the governor proposed, meaning that the city started the 2015-16 fiscal year with a potential shortfall of $1.5 million.
2. Providence was spared significant cuts in tourism tax revenue.
The state budget introduced by Governor Raimondo sought to take just over $2 million in hotel tax revenues away from the state’s regional tourism bureaus – including a 50% cut in aid to Providence – and use it for a statewide tourism marketing campaign. The budget she signed into law still cuts support to Providence, but only by about 7%. City officials believe they’ll be able to make up that money by a new tax on on small bed and breakfasts, room resellers such as Expedia and unlicensed rental services such as Airbnb.
3. Tax credits for development.
The mayor asked the General Assembly to approve a bill that would “renew and/or expand” the state’s historic tax credit program, and the Rebuild Rhode Island tax credit created by Governor Raimondo accomplishes something very similar. Projects costing at least $5 million (or less in a lower-income “hope community,” like Providence) can get a tax credit from the state worth up to 30% of the project’s total cost. The credits will be awarded on a competitive basis by the R.I. Commerce Corporation. The program caps the amount of tax credits any individual project can get at $15 million.
4. The moratorium on school construction was lifted.
City officials say Providence would need to spend between $300 million and $600 million to make significant improvements to its 39 public school buildings, so it’s no surprise the mayor asked state lawmakers to back the governor’s proposal to set aside $20 million for a new program for school construction while also budgeting about $71 million to help pay for older projects.
1. Reimbursements for tax breaks.
State lawmakers approved a proposal that would reimburse cities and towns for up to 10% of forfeited tax revenues from new tax-stabilization agreements they enter into, a plan designed to encourage communities to offer incentives to spur development. Mayor Elorza asked the state to provide full reimbursement for tax breaks on the vacant I-195 land, but a bill to do that was never introduced in the Senate.
2. No changes to the car tax.
Mayor Elorza made a campaign pledge to seek changes to the city’s car tax – he called it “one of the most regressive taxes” in Providence – but several pieces of legislation aimed at reducing the car tax or changing the way vehicle values are assessed were never seriously considered this year.
3. Providence will lose out on bond proceeds.
A provision in state law that allowed cities and towns to receive 80% of the savings earned on the refinancing of Rhode Island Health and Educational Building Corporation (RIHEBC) bonds expired this year and is now moving back to 50%, which could have a significant impact on many municipalities. Separately, a provision in the state budget changed the makeup of the RIHEBC board from five members to seven, all of whom will be appointed by the governor.
4. Local fines won’t be increased.
Mayor Elorza asked the General Assembly to approve two bills that would have provided extra cash to the city’s coffers through fines and forfeitures, but neither piece of legislation was approved. One would have increased the maximum fine a city can levy from $500 to $2,000. The other would have allowed Housing Court judges to impose property liens on homes that have been assessed fines, making the city the primary lien holder, ahead of banking instructions.