Ted Nesi’s Saturday Morning Post: Feb. 13

Happy Saturday! Here’s another edition of my weekend column for WPRI.com – as always, send your takes, tips and trial balloons to tnesi@wpri.com, and follow @tednesi on Twitter.

1. When Governor Raimondo put her signature on the RhodeWorks bill Thursday night, it capped off an impressive streak of first-year victories for her at the General Assembly (even if she had to wait an extra month and a half for this final one). The road wasn’t always smooth – it rarely is in politics – but as of today Raimondo can point to at least four major policy wins in 14 months: a pension settlement, a Reinventing Medicaid initiative, an economic-development “toolbox,” and now a huge transportation-funding plan. The first two are aimed at reining in the fastest-growing items in the state budget; the latter two are aimed at creating jobs and positioning Rhode Island for the future. By no means does that prove Raimondo has the right recipe – as House Minority Leader Brian Newberry pointed out last week, a more conservative governor would take a different approach. But there’s a reason she’s so often compared to Bruce Sundlun: when Rhode Island’s governor is dynamic and Democratic, the ship of state can change course quite a bit. As for RhodeWorks specifically, it represents a win for Raimondo on multiple fronts. It will tackle a very real problem – and one that’s very visible to voters – by fixing roads and bridges. It creates a new permanent stream of revenue for RIDOT. And it will provide lots and lots of construction jobs for union workers – music to the ears of Laborers honcho Armand Sabitoni, one of Raimondo’s oldest allies. RIDOT’s budget is now set to swell from $477 million to $628 million, peaking just as Raimondo will be running for re-election in 2018. Yet legislative success is hardly the only key metric in judging a governor, and maybe not even the most important one. Another is implementation. Can Raimondo’s administration actually carry out RhodeWorks on time and on budget? Or successfully deliver on its promised Medicaid savings? Or utilize its economic incentives smartly and transparently? The governor had better ensure it.

2. Now that 77 Democratic state lawmakers have cast votes for truck tolls, attention turns to whether there will be significant political fallout. Republicans are gleeful, expressing confidence the issue will doom incumbents this fall. “Democrats who joined Speaker Mattiello, Senate President Paiva Weed and Governor Raimondo to force new tolls onto the taxpayers are now officially members of the Ocean State Job-Killing Squad,” GOP Chairman Brandon Bell told me. “I expect their vote with State House leadership, as opposed to hardworking Rhode Islanders, will take a big ‘toll’ on them in November.” Democrats offer a few counterarguments. This is a presidential election year, which means a more heavily Democratic electorate than in 2014. By limiting tolls to trucks, Democrats have avoided levying a direct fee on voters (even if it leads to higher costs indirectly), and tolling won’t actually start until late 2017. Some lawmakers have judged that those most outraged by tolls were never their voters to begin with – and hope that other voters won’t be so exercised. Lastly, by casting their votes this month, lawmakers have nine months before the election to hope tolling fades from the headlines. There’s no guarantee of that, however: congressional Democrats similarly hoped anti-Obamacare sentiment would subside after it was finalized in March 2010, but that didn’t happen.

3. As for a legal challenge to tolling, the Rhode Island Trucking Association’s Chris Maxwell told Tim White on Friday he thinks his industry can’t take its case to the courts until gantries are up and running – though he hopes federal officials intervene in their favor in the interim.

4. Despite last weekend’s headlines, Ocean State Job Lot CEO Marc Perlman made clear on this week’s Newsmakers he plans to go ahead with the company’s $50-million warehouse expansion project at Quonset. Those who “were listening carefully,” he said, understood his point was that the company just needed hard data on the cost of the tolling plan to move forward. “It’s our intent to build this warehouse, not because it’s the best place to build it – it’s not,” Perlman said. “My consultants have advised me we could save $4 million to $5 million if we opened this warehouse in Pennsylvania. And I said to them, Rhode Island has treated us well, this is where we educated our kids, this is where we live – we’re going to put the warehouse here.” He confirmed the company is seeking subsidies from the state’s new economic-incentive programs, but said he didn’t know how much exactly.

5. As for tolling overall, Marc Perlman said he expects the new law will cost Job Lot $9 million to $10 million over its first 10 years; to put that in perspective, he expects the company to ring up somewhere in the neighborhood of $670 million in sales this year. He remains adamant that it’s unfair for the trucking industry to shoulder the burden of tolling alone. “There is no state in the United States that is taxing large trucks at the exclusion of every other motor vehicle, so we are going to be an outlier,” Perlman said on Newsmakers. “Forty-nine states do it one way; Rhode Island’s going to do it another way. So are we smarter than everyone else, or is everyone smarter than us?” Commerce Secretary Stefan Pryor countered that where Rhode Island is really an outlier is in its worst-in-the-nation bridges, which RhodeWorks will tackle. “From Maryland to Maine, almost every state has tolling – most states greater tolling, greater amounts, than we do,” Pryor said. He also noted that trucks elsewhere still usually pay higher tolls than passenger vehicles, and dismissed the fact that cars will pay nothing in Rhode Island. “That doesn’t make a difference as to comparisons for trucks,” he said. “It makes no difference.”

6. One overlooked bit of good news for the trucking industry: the Raimondo administration could actually institute lower tolls than have been floated so far. The legislation passed this week sets out maximum toll amounts, but not minimums – and now that toll revenue isn’t being used to cover bond payments, the administration has wide latitude in determining how much it actually needs to raise from truckers. State officials still plan to commission an investment-grade study of tolling options this year before making a final determination on how it will work. But RIPEC’s study found that netting $45 million a year from truck tolls would leave RIDOT over-funded as soon as 2023. (As a side note, while Speaker Mattiello’s critics may grumble about the politics of his delaying action on tolls, it’s inarguable that his doing so allowed for savings and more flexibility in the final product.)

7. Speaker Mattiello is many things, but subtle isn’t one of them. So his message was clear Thursday when, minutes before the toll bill was signed, he punished three Democrats who bucked him on the final vote – Reps. Ray Hull, Robert Phillips and Joe Solomon – by removing them from their key committees. Andrew Morse, one of many who criticized Mattiello for the power play, noted that only the House gives its leader unilateral power over committee assignments. Intriguingly, six other Democrats who voted no – Dennis Canario, Greg Costantino, Karen MacBeth, Mike Marcello, Jared Nunes and Thomas Winfield – didn’t suffer the same punishment. On the Senate side, Senate President Paiva Weed lost six Democratic senators on the final vote: Marc Cote, Paul Jabour, Roger Picard, Leo Raptakis, Adam Satchell and Jim Sheehan. And those Senate no votes were quite a statement considering the legislation was a top priority for the man who wants to be their next leader, Senate Majority Leader Dominick Ruggerio.

8. With tolls off the table, expect State House attention to turn now to the budget.

9. Our weekly Saturday Morning Post dispatch from WPRI.com’s Dan McGowan: “Shortly before he left office in early 2015, former Providence Mayor Angel Taveras predicted that construction of the nursing education center at the South Street Power Station near downtown would lead to a new slate of projects throughout the city, even joking that incoming Mayor Jorge Elorza would get to take credit for the boom. During his first State of the City address this week, Elorza made it clear he’s not just seeking credit for what he believes will be Providence’s busiest construction season in a generation – he’s making it the focal point of his second year in office. In his speech, Elorza suggested there were more than 30 projects worth around $500 million set to break ground in 2016; on Friday, his office provided a list of 32 projects worth $704 million, including several parts of the nursing center project, as well as Wexford’s proposed life-sciences complex on the former I-195 land and at least two hotels. Critics will inevitably note that many of the projects he’s counting on will be tax-exempt – like most of the nonprofit expansions – or heavily subsidized through tax-stabilization agreements, but Elorza is likely banking on the imagery of ‘cranes in the sky’ almost as much as he is new tax or permitting revenue. It’s a smart play for a couple of reasons. After a turbulent first year in office that included a $5-million deficit and an ugly dispute with the city’s firefighters, Elorza needs a win. He knows Governor Raimondo has staked her entire political career on improving Rhode Island’s economy, and she can’t accomplish that goal without the capital city. He also knows that one way or the other, many residents across the city are going to see a tax hike July 1 (either through the state-mandated property revaluation or a tax rate increase, or both). In order to justify the increase, he’ll want to show that the city isn’t simply balancing its budget on the backs of taxpayers – and the construction could send that message.”

10. My favorite section of Joe Paolino’s ode to Buddy Cianci at Monday’s funeral Mass: “Years later, Buddy went to Italy and visited former Boston Mayor Ray Flynn who was Ambassador to the Vatican. At that time I was Ambassador to Malta and Buddy also came to visit. We had a late night of wine, song and cigars. Justice Antonin Scalia was with us.” Oh, to be a fly on that wall.

11. Where do things stand with GE and Rhode Island? Commerce Secretary Stefan Pryor reports he’s been in touch with company officials as recently as Thursday. “There’s an active conversation about business units that might make sense in Rhode Island,” Pryor said on Newsmakers. “We’re very pleased with the rapport we’ve developed with them, and there are types of jobs and types of business operations we think would be terrific fits here.”

12. Why corporate headquarters locations still matter – somewhat.

13. Governor Raimondo got some more national attention at the end of this week, this time in a column by the FT’s Gillian Tett, who echoed an increasingly common talking point from the governor contrasting Rhode Island leaders’ activity with the gridlock in Washington. (Sounds like a statement a presidential candidate might make, no?) Tett’s column is her second on Raimondo since the 2011 pension law, and that’s surely no accident, considering Rhode Island isn’t usually on the FT’s radar. Raimondo’s team has made a conscious effort to court centrist opinion leaders, as also evidenced by the two columns on Raimondo penned by The Washington Post’s Fred Hiatt, as they seek to burnish her national brand.

14. Bernie Sanders campaign ads are now airing on Rhode Island TV stations – presumably to reach Southeastern Massachusetts voters ahead of their state’s March 1 primary. (Rhode Island doesn’t vote until April 26.)

15. State House conventional wisdom gives low odds to the chances that Rhode Island lawmakers legalize marijuana this year. But advocates led by Regulate Rhode Island’s Jared Moffat haven’t given up hope. They introduced legislation this week in an effort to advance the cause, and are hoping the looming November referendum on the same topic in Massachusetts could spur the General Assembly to act first. It still seems like a long shot – when an election is near, lawmakers are loathe to touch anything they view as controversial – but worth keeping an eye on.

16. Chelsea Clinton played to type during her visit to Providence on Friday, holding a closed-door fundraiser but spurning basically any interaction with the reporters staking out her event after they spent over an hour waiting in the bitter cold. As Politico’s Jack Shafer recently explained, it’s all part of a long-running media strategy by the former first daughter.

17. Also by Jack Shafer: the surprising history of government transparency.

18. Reihan Salam can’t hate Donald Trump; Ross Douthat can’t learn to love him.

19. A disquieting look at our addiction to digital devices.

20. Lastly, a friendly reminder (or warning): tomorrow is Valentine’s Day.

21. Set your DVRs: This week on Newsmakers – two views on tolls, from Ocean State Job Lot CEO Marc Perlman and Commerce Secretary Stefan Pryor. Watch Sunday at 10 a.m. on Fox Providence. This week on Executive Suite – Invenergy executive John Niland on the Burrillville power plant proposal; Capital Good Fund CEO Andy Posner on its $4.25-million debt offering. Watch Saturday at 10:30 p.m. or Sunday at 6 p.m. on myRITV (or Sunday at 6 a.m. on Fox). Catch both shows back-to-back on your radio Sunday nights at 6 on WPRO-AM 630 and WEAN-FM 99.7. And you can subscribe to both shows as iTunes podcasts – click here for Executive Suite and click here for Newsmakers. See you back here next Saturday morning.

Ted Nesi (tnesi@wpri.com) covers politics and the economy for WPRI.com. He hosts Executive Suite and writes The Saturday Morning Post. Follow him on Twitter: @tednesi

Comments are closed.