Nesi’s Notes: Nov. 18

The Saturday Morning Post | Quick hits on politics and more in RI

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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. It’s been a worrying week for those who want a perkier Rhode Island economy. True, the unemployment rate remains quite low, at 4.2%. But IHS economist Michael Lynch presents a gloomy picture in his latest report to state leaders. Rhode Island continues to have an older and less educated work force than competing states. Key industries like health care and finance have been cutting employees. The state’s job count is basically the same as it was 11 years ago, and payroll growth is forecast to rank 48th out of the 50 states through 2022. State revenue is missing estimates, worsening the never-sunny budget picture. Governor Raimondo’s aides argue she is working aggressively to improve the situation, exemplified by a two-day trip to New York this week that included four mystery meetings about economic development. But even her successful efforts don’t always pan out – A.T. Cross’s new owner confirmed Thursday it’s cutting jobs, one year after seeking state support for a relocation. (On the plus side, because A.T. Cross didn’t achieve the Raimondo administration’s job goals, it never got any taxpayer money.) Unsurprisingly, the governor’s 2018 opponents are seizing on all this to make the case that she isn’t delivering on her promises of job growth and economic renewal. But they will also need to explain what they’d do differently that would have a measurable impact.

2. State budget officer Tom Mullaney has a new estimate of the deficit Governor Raimondo will need to close when she releases her tax-and-spending plan in January: $264 million. That breaks out as $60 million to bring the current 2017-18 budget back into balance, and $204 million to close the shortfall expected for 2018-19. (The latter number is down from the original estimate of $237 million.) Not all of it is because of state leaders: the deficit will be $12 million lower if Congress reauthorizes two health programs it recently allowed to lapse. But even $252 million would still be a big number. “It is clear that we are in another difficult budget year,” Senate Finance Committee Chairman Bill Conley said Thursday. “The major budget gaps are in agencies that serve the state’s most vulnerable populations. … The Senate will urge health and human service agencies, that provide needed services to over 300,000 Rhode Islanders, to continue to shift delivery to the most appropriate and cost-effective settings.”

3. Robert Flanders formally kicked off his campaign for Congress on Thursday, seeking to become the first non-Chafee Republican to win a Senate seat in Rhode Island since 1930. On Friday the 68-year-old former justice joined us on Newsmakers, where he tackled a host of questions about policy and politics. A few highlights. … Flanders voted for Donald Trump and likes the president’s goals, but has mixed feelings about his “methods,” particularly his tweets and his “baiting” of Kim Jong-un. … He’s pro-life, interested in marijuana legalization, in favor of term limits, and open to raising the Social Security retirement age. … He wants the federal government to start negotiating lower drug prices to make health care cheaper. … As a longtime Care New England board member, he defends their decision to close Memorial Hospital, saying the facility had become a “rathole” jeopardizing the system’s finances. … He supports an ethics investigation into the sexual-harassment allegations against Sen. Al Franken, but not President Trump. “He’s already on record as doing what he did,” Flanders said of Trump. “The voters, unfortunately or fortunately, have elected him notwithstanding all of that. I don’t know that another ethics investigation is going to turn out anything new.”

4. Dick MacAdams, chief legal counsel at the Procaccianti Group and a lifelong friend of Bob Flanders‘, told a funny story about the candidate at the kickoff event. Recalling Flanders’ successful runs for Barrington Town Council in the early 1980s, MacAdams said, “Bob is an untiring campaigner. I remember Bob telling me how he had walked the streets of Barrington, knocking on hundreds of doors. At the end of one tiring day in 1981, he knocked on a door. A nice older gentleman answered. After a brief conversation, the old man said, ‘I like what you have to say. Wish you luck. But I’m not going to vote for you.’ Bob looked at him perplexed and disappointed. ‘Why not?’ asked Bob. The man pointed to a marker about 50 yards away and said, ‘The Barrington town line is over there. You’re in East Providence.'”

5. The polling memo released Monday by Republican Allan Fung’s gubernatorial campaign makes for an interesting read. First, two caveats. The campaign declined to release the entire poll, so it’s impossible for outsiders to know how reliable it is. And it was an automated robo-poll, not a gold-standard live-interview survey. But at face value the numbers lead to a couple observations. First, the poll suggests Fung starts as the GOP frontrunner, which wouldn’t be a surprise considering he was the party’s 2014 nominee and leads the state’s third-largest city. Second, the poll gives Patricia Morgan reason for hope – she’s at 24%, well behind Fung’s 45% but a good distance ahead of Joe Trillo’s 10%, with one in five voters undecided. Third, the poll puts Gina Raimondo’s job approval in the 40s, consistent with other surveys (though, again, Rhode Island sorely lacks live-interview polling right now). As you’d expect, that sets up a very competitive November election: Fung’s campaign says it’s a 5-point race, with him at 46% and her at 41%. Ian Donnis reports Fung was in Texas this week for the Republican Governors Association meeting; he was probably glad to tout these numbers. “We’re building a winning coalition for 2018!” Fung tweeted. “The proof is in the poll.” (R.I. Democratic Party executive director Kevin Olasanoye’s response: “It’s not a surprise that Allan Fung’s internal poll shows Trump voters are supporting a Trump candidate in a Trump primary.”)

6. Democrat José Batista is considering a 2018 run for AG.

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7. Our weekly dispatch from WPRI.com’s Dan McGowan: “When the mayor of Providence, eight members of the City Council and labor leaders all agree on an issue, it’s typically a safe bet to say they’re going to get their way. So why isn’t a proposal to create a standardized process for special tax deals in the city – supported by Mayor Elorza, cosponsored by the majority of the council and backed by Michael Sabitoni – guaranteed to move forward? Let’s start with the purpose. Ideally the city wouldn’t be giving tax breaks to anyone, but it’s become a generally accepted rule among decision-makers that Providence – and plenty of other cities around the country – needs to offer incentives to make up for high taxes. So if the city is going to offer tax deals, streamlining the process in order for developers to know exactly what they’re getting based on how much they’re spending on construction would appear to make sense. Supporters say it cuts politics and time out of the equation, compared with the existing process where most tax deals are negotiated on a one-off basis and subject to a public hearing plus the grilling of the council Finance Committee. But a standardized tax break is not a perfect solution either. First, because the existing process does require a public hearing and vote, a plan that doesn’t require either could be seen as a step away from transparency. Perhaps more importantly, no two projects are the same, even if the same amount of money is being spent. For example, should an affordable housing development in the West End be subject to the same terms as luxury apartments downtown? When it comes to the politics at play, it’s important to know the proposal was referred to the council Finance Committee, where only one of the five members is a co-sponsor. If a vote was scheduled for next week, it’s hard to believe the proposal would even make it to the council floor. Of course, there are procedural ways to force the full council to vote on the matter, but the supporters have a lot more work to do if they want to win passage.”

8. A must-read: East Greenwich News’ Elizabeth MacNamara answers the question, “What Is Happening in East Greenwich and Why?”

9. Reports out of Speaker Mattiello’s House District 15 say he’s polling voters there on issues including the PawSox, marijuana, and his own job approval. Mattiello’s spokesman had no comment Friday.

10. Senate leaders are still planning to move ahead on the PawSox stadium plan, but there won’t be a vote this month. Senate President Dominick Ruggerio told the Projo’s Ed Achorn he expects the Senate Finance Committee to hold a hearing Dec. 7 where they’ll unveil proposed changes to the ballpark bill, in a so-called Sub A. “That’s our game plan,” Ruggerio said. “That’s our time-frame right now.” At the moment, though, they’re still waiting for Commerce RI and the auditor general to provide letters about the team’s financial health so the committee can finish and release its white paper on the proposal.

11. Speaking of Senate President Ruggerio, he’s partnering with the Providence firefighters union and Veazie Street Elementary School’s teachers on a good cause: raising $30,000 for Operation Warm to buy new winter coats for kids in Providence. You can donate here.

12. Earl “Buddy” Croft, who’s led the quasi-public R.I. Turnpike and Bridge Authority since 2006, tells me he’s unlikely to sign another contract as executive director, though he expects to stay until his current three-year term ends in mid-2019. “Obviously life is short – you take it one day at a time,” Croft said. “But I expect to be here through the contract.” He added, “It’s been a great ride.”

13. Speaking of quasi-publics, the R.I. Health and Educational Building Corporation is keeping a nervous eye on the debate in Congress over tax reform. The somewhat obscure agency floats tax-free bonds to fund capital projects for hospitals, colleges and other major institutions in those sectors; its borrowing currently totals more than $2 billion. But the House tax bill would eliminate the type of debt instrument RIHEBC floats, known as private-activity bonds. (The Senate would not.) The change would increase federal tax revenue by roughly $40 billion over the next 10 years to offset the House bill’s other tax cuts. “By eliminating access to tax-exempt financing, the nonprofit sector will be forced to obtain more expensive taxable financing which will increase the interest expense for a project,” argues Bob Donovan, executive director of RIHEBC. “This increased financing expense could necessitate either downsizing a project or allocating more funds which could have been used for client services to debt service. In some cases, projects may even be cancelled.”

14. It sure sounds like Ken Block’s battle with the Board of Elections won’t be ending anytime soon.

15. Does Benny’s have a deal to sell its real estate? That’s the buzz among real-estate insiders. But a spokesman for the retailer isn’t saying yet.

16. State Sen. Gayle Goldin argues in an essay for Glamour magazine that speaking out against sexual harassment backfires on elected women. “Sadly,” she writes, “for many women in office, if you start speaking truth to power, power talks back – by killing your bills, changing your committee assignments, and smearing your reputation.”

17. “Dear Gov. Raimondo: Express trains wrong ask.” Former Massachusetts Transportation Secretary James Aloisi and transit activist Ari Ofsevit offer some alternative ways Rhode Island could improve MBTA service to Boston.

18. Is Providence College losing its Catholic identity? Anne Hendershott makes the case in City Journal.

19. Why you should listen when your sacred cows are questioned.

20. Happy Thanksgiving to you and yours. I’m thankful for everyone who reads Nesi’s Notes each week – without you, I wouldn’t have a job!

21. Set your DVRs: This week on Newsmakers – Republican U.S. Senate candidate Robert Flanders. This week on Executive SuiteRobert Atkinson and Laurie White. Watch Saturday at 10:30 p.m. or Sunday at 8 p.m. on myRITV (or Sunday at 6 a.m. on Fox). Catch both shows back-to-back on your radio Sundays at 6 p.m. 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 writes Nesi’s Notes on Saturdays and hosts Executive Suite. Follow him on Twitter and Facebook