Nesi’s Notes: Dec. 2

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 not every day that one of the world’s biggest public companies holds a news conference in Providence. But on Monday morning, there was Infosys President Ravi Kumar announcing plans to open a new Design and Innovation Hub in the capital city, with an initial commitment of 500 jobs. Kumar fairly gushed about Rhode Island in his remarks, heaping praise on state leaders, CCRI and the collaborative spirit he said he’s found here. So is Providence truly developing a significant digital-economy cluster? The Infosys news gave more hope to those who think so, following commitments by GE Digital, Johnson & Johnson, Virgin Pulse and Wexford, as well as the growth of homegrown businesses like Upserve. If there is a fly in the ointment, though, it’s the sizable tax incentives the Raimondo administration is handing out to woo these companies; Infosys will be eligible for an estimated $10 million, largely through rebates of some of the income tax revenue the new jobs generate. “Why not improve the overall business climate in order to allow real job growth?” asked potential Republican gubernatorial candidate Joe Trillo, echoing those who suggest the money would be better spent on a broad-based tax cut. Commerce Secretary Stefan Pryor acknowledged the concern on this week’s Newsmakers, but argued state leaders have been doing both, citing recent business tax cuts for energy and unemployment insurance. “I do think that over time, not instantaneously but over time, we can ratchet down the amount of incentives,” Pryor said. “Right now, though, we need to be competitive. If you look at Indiana, if you look at North Carolina, where Infosys has done other deals – they’re offering tens of millions of dollars to Infosys to do those deals. We have to compete.”

2. She wasn’t one of the dignitaries invited up to the podium, but Commerce RI’s Lynn Rakowsky still made one of the biggest impressions at the Infosys announcement. Describing how Rhode Island wound up on his radar screen, Infosys’s Ravi Kumar recalled, “Lynn from the business-development team of Stefan [Pryor] reached out to me on LinkedIn. And she kept writing to me. And I just ignored her messages. And then finally she ended up in my office.” Providence activist Ethan Gyles quipped on Twitter, “Take that, LinkedIn haters.” Rakowsky is part of a team led by Hilary Fagan, the Nasdaq alum hired last year as Commerce’s executive vice president of business development.

3. T.F. Green Airport appears to be on the upswing. Air Canada’s announcement this week that it will resume direct flights from Providence to Toronto in May makes it the fifth airline to expand service there in 2017, joining Norwegian, Frontier, Allegiant and OneJet. Green has now doubled its nonstop routes over the last 10 months, bringing the total to 34, the highest since 2002. The airport also saw 321,282 passengers in September, an increase of 6% from the same month last year. (That was still well down from a decade earlier, however, when T.F. Green had 415,000 passengers.) Much of the credit has accrued to Airport President and CEO Iftikhar Ahmad, who took over last year, as well as lawmakers’ decision to create a new fund that subsidizes additional routes. Also pitching in was Governor Raimondo, whose office reports she cold-called Air Canada’s CEO to close the deal for the new Toronto route.

4. A local story deserving more attention is the potential for not one but two mega-acquisitions by Rhode Island’s largest companies. First up is CVS’s proposed takeover of Aetna, which reportedly could close as soon as Monday for a cool $65 billion. As The Boston Globe’s Jon Chesto noted, “The deal could dramatically affect the health care industry. CVS … owns nearly 10,000 drugstores and is a major pharmacy-benefits manager. Aetna, based in Hartford, Conn., is one of the country’s largest health insurers. A merger could give CVS new customers, and more leverage in negotiations with drug makers. The deal comes as CVS gears up for a possible incursion by Amazon into the prescription drug business.” It’s unclear what, if anything, a CVS-Aetna tie-up would mean for Rhode Island specifically, but at the least it would give the Woonsocket giant more size and scale to face the future. Then there is Hasbro’s reported effort to acquire archival Mattel, which Reuters says hit the skids in mid-November but some analysts still think makes sense. Their combined revenue would theoretically vault Hasbro from 509th to 278th on the Fortune 500 list, just as the company is weighing whether to build a big new headquarters.

5. The nursing students taking classes in the newly opened South Street Landing building may just have the best views in Providence.

6. The Care New England saga is starting to have as many twists as a TV hospital drama. Rhode Island’s No. 2 hospital group has lost more than $100 million over the last two years, and the outcome of its merger talks with Boston behemoth Partners HealthCare remains uncertain. Now Brown University and Prospect Medical Holdings are exploring whether they can get control of CNE should the Partners deal fall apart. The Ivy League university and the private-equity-backed for-profit hospital chain seem an unlikely pair – Brown previously considered working with Lifespan on a bid for CNE – but both have their reasons for at least considering a partnership. Meanwhile, Memorial Hospital continues to suffer through what appears to be a slow-motion demise, with patient admissions stopped Friday. One regular Nesi’s Notes reader argued this week that Rhode Island leaders have been negligent for years on Memorial, first by allowing the hospital to remain open for so long without a viable financial plan, then by letting the situation destabilize the rest of CNE, and now by holding off on formally pulling the plug even as it effectively shuts down.

7. The Carpianato Group’s decision to buy all the company-owned Benny’s properties and spend more than $100 million redeveloping them will be welcome news to state and local leaders, who had reason to fear the real estate could sit empty in this tough time for brick-and-mortar retail. But some laid-off Benny’s employees remain very unhappy about how they’re being treated.

8. The Senate no longer plans to vote on the PawSox stadium plan this year, ensuring the issue will drag well into 2018. Massachusetts Gov. Charlie Baker gave local ballpark backers a new talking point on Friday, suggesting to reporters in Worcester that his administration could put money behind a new stadium there “in the form of infrastructure projects or public investment.” Pawtucket Mayor Don Grebien seized on Baker’s remarks Friday night to argue for faster action by lawmakers. “January may be too late,” he said. “We must act now.” Another argument circulating on Smith Hill is that Pawtucket should get the ballpark in part as a consolation prize, because the city is facing two other big economic blows: the seemingly imminent closure of Memorial Hospital, and the very real threat that Hasbro will move its headquarters to Providence. Then again, there are other ways the state could support the city if that’s the underlying goal.

9. The cost of UHIP is now an eye-popping $492 million.

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10. The Rhode Island Working Families Party has only existed for about 18 months, but it’s already made its presence felt at the State House. On Smith Hill, the advocacy group was instrumental in securing passage of the new paid sick days law this year. On the campaign trail, it played a key role in last year’s defeat of then-House Majority Leader John DeSimone. The organization – which, despite its name, is not a traditional political party nominating candidates – says it has 6,000 to 7,000 members statewide and continues to grow. Georgia Hollister Isman, the group’s state director, said its goals for next year include pushing passage of a phased-in $15 minimum wage. She also downplayed its differences with Speaker Mattiello and other more conservative Democrats who lead the House. “I do think we can move a lot of good progressive legislation forward with the current leadership structure,” she said on this week’s Newsmakers. “I also think it’s our job to help push the whole House and Senate to the left on these issues and convince them that there’s a real demand from their voters to advance economic justice legislation.” As for how active Working Families will be in 2018 primary races, Hollister Isman said, “I think it’s going to be an interesting year.”

11. U.S. Sen. Sheldon Whitehouse has a way of making news that his counterpart Jack Reed probably never would. This week’s example found Republicans and allied news outlets accusing Whitehouse of comparing a Trump appointee to a horse. “This is dehumanizing,” Republican National Committee Chairwoman Ronna McDaniel tweeted. “Senator Whitehouse should apologize immediately for his demeaning comment.” The appointee in question was Kathleen Hartnett White, the president’s nominee to lead the Council on Environmental Quality, who already had a contentious exchange with Whitehouse at her confirmation hearing when she declined to say whether water expands as it warms. The horse comment came at Wednesday’s Environment and Public Works Committee hearing, where Whitehouse referenced the legend of Emperor Caligula appointing his horse to the Roman Senate. “[Committee] Chairman [John Barrosso] and a couple of right-wing media outlets misstated Senator Whitehouse’s remarks, which called out the Republican majority’s eagerness to approve dangerously unqualified Trump administration nominees,” insisted Whitehouse spokeswoman Meghan McCabe.

12. What to make of Michael Flynn’s plea deal? The experts at Lawfare have an in-depth analysis here, while Robert Mueller’s biographer looks at what’s next here.

13. It’s the most wonderful time of the year – which means it’s time for the annual General Assembly Christmas parties. In the House, Speaker Mattiello and Majority Leader Joe Shekarchi are circulating an invitation to a “Holiday Celebration” on the evening of Dec. 10 at Chapel Grille, in Mattiello’s hometown of Cranston. The speaker and the leader will split the cost between their campaign accounts. In the Senate, President Dominick Ruggerio has two soirées on his calendar: a holiday dinner for senators Friday at the Providence G Ballroom, and a holiday party for Senate staff Dec. 15 in the Senate Lounge. Both events will be funded by campaign contributions.

14. Grab a Kleenex and don’t miss this Jared Pliner story on the moment a man was reunited with his dog after a horrific head-on crash on I-295.

15. Thinking of giving books as Christmas gifts this year? You can pick up some local ones today, as the Association of Rhode Island Authors holds its 5th annual expo from 10 a.m. to 5 p.m. at Rhodes on the Pawtuxet. The group’s president, Steven Porter, said 135 authors are expected, including Marie Force, the Jamestown romance novelist whose books have sold more than 6 million copies. Porter discussed the expo and the book business on this week’s Executive Suite.

16. Stephen King has 22 tips on how to be a great writer.

17. The scars of the Great Recession are still with us.

18. Is the United States having a sudden baby bust?

19. The New Yorker on Vince Guaraldi, the man behind the classic “Charlie Brown Christmas” jazz soundtrack.

20. Set your DVRs: This week on Newsmakers – R.I. Commerce Secretary Stefan Pryor; Georgia Hollister Isman, state director, Rhode Island Working Families. This week on Executive SuiteEd Hammersla, chairman/CEO, Utilidata; Steven Porter, president, Association of R.I. Authors. 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