Rhode Island news
| Recommended 
School aid won’t grow
01:00 AM EDT on Saturday, June 16, 2007
The House of Representatives clashed over public-education financing for more than two hours. They screamed. They insulted each other. They used props.
But in the end, they didn’t change much.
Representatives Arthur Corvese, left, and Steven Costantino confer during last night’s budget session. Ultimately, lawmakers decided to level-fund public education.
The Providence Journal / Ruben W. Perez
Lawmakers last night voted to freeze education aid for Rhode Island’s 39 cities and towns during a marathon budget debate that hadn’t ended after 10 hours.
They also closed a series of corporate tax shelters, knocked an estimated 2,400 children off state subsidized childcare, agreed to allow Sunday auto sales, decided to use millions from the sale of tobacco-settlement bonds to balance the budget and required that 17-year-olds be tried as adults for criminal offenses.
The Senate will take up the budget next week.
The passionate debate over education financing divided the House’s Democratic majority and forced lawmakers to go on record voting for a budget that gives cities and towns $19.4 million less than Governor Carcieri proposed earlier in the year.
“I think I’m agreeing with a conservative Republican governor that we have to fund education,” said Steven F. Smith, D-Providence. “If we’re the school board for the state, we have to fund education properly; $19 million is not a lot of money in a $6-billion budget.”
The political implications of the school-aid vote were not lost on Republicans, who were a small but vocal presence last night, representing just 13 of 75 members.
“This is the showdown vote,” said House Minority Leader Robert A. Watson, R-East Greenwich. “If you vote for this article, you might be doing what the leadership in the chamber wants you to do. You decide. Are you with your community, or is your vote in this room?”
Smith, the president of the Providence Teachers Union, was among 12 Democrats who joined the 13 Republicans voting against level funding. Fifty Democrats, including House Speaker William J. Murphy, Majority Leader Gordon D. Fox, D-Providence, and House Finance Committee Chairman Steven M. Costantino, D-Providence, voted for the measure.
“There’s nothing to be embarrassed about,” Fox told those who voted yes. While lawmakers did not increase funding over last year’s amount, the state will distribute $864 million to communities next year, he noted. “That is providing aid,” Fox said, adding that “a message has to be sent” to local school committees to control spending.
And with virtually no debate, lawmakers approved, on a 48-to-19 vote, one of the more controversial proposals of the night: trying 17-year-olds as adults on all criminal charges.
“I understand that we must do this,” said Rep. Joseph S. Almeida, D-Providence, who ultimately voted against the change. But, he warned, time spent at the Adult Correctional Institutions “doesn’t correct anybody.”
While the vote represents a major policy shift, it was framed as a budget decision. The average annual cost of incarcerating someone at the ACI is about half the average cost of housing a youth at the Rhode Island Training School.
Starting July 1, 17-year-olds tried as adults, convicted of crimes and sentenced to probation, rather than prison time, will also fall under the Department of Corrections budget rather than the Department of Children, Youth and Families. All told, the changes are expected to save $3.6 million.
The governor’s office wasn’t happy with the House’s actions.
“It appears that the House is about to pass a budget that will be a disaster for Rhode Island taxpayers, businesses and local schools,” Carcieri spokesman Jeff Neal said late last night. “Unless this budget dramatically changes before passage by the Senate, the governor would have no choice but to veto.”
Other pieces of the $6.99-billion budget proposal the House addressed during the first 10 hours:
Lawmakers made two changes to the state’s subsidized childcare program. Together, the changes are expected to make 2,400 children ineligible for the program.
Legislators are lowering the upper age limit for the program from 16 to 13. House fiscal staff said about 300 children between ages 13 and 16 now qualify for state-subsidized care.
They are also lowering the income-eligibility threshold from 225 percent of the federal poverty level ($46,463 for a family of four) to 180 percent ($37,170). That change is expected to disqualify about 2,100 children.
A group of lawmakers, led by Rep. Grace Diaz, a Providence Democrat who has been a childcare provider in the past, tried to amend the budget to bring the rate back up to 225 percent.
“We’re talking about parents who work every day and pay their taxes,” said Rep. Joseph S. Almeida, D-Providence, who voted for Diaz’s amendment.
But the amendment ultimately failed.
Costantino noted that Carcieri proposed pushing the threshold down to 150 percent of poverty ($30,975 for a family of four), and lawmakers had to add in $7.6 million to bring it up to 180 percent. Diaz’s amendment would cost another $7 million, “which quite frankly, we do not have,” Costantino said.
“I don’t think there’s any question that childcare … keeps people in their jobs,” he said. “At this point, we just can’t afford it.”
Lawmakers fought off a proposal to increase the long-term capital-gains tax to 5 percent.
It fell from 5 percent this year to 1.67 percent and was set to be phased out next year as part of the Assembly’s recent tax-reform package. House leaders supported freezing capital gains at the current 1.67-percent rate, but would go no further. Opposition came from Republicans — who fought anything but a phase-out — and a handful of Democrats, who saw an increase to 5 percent as a way to pay for education and social services.
“We have to give this at least a try to see if it works to see if we can get the kind of investment and job growth in this state that is severely lacking,” Costantino said of a reduced capital-gains tax, responding to a push by Rep. David Segal, D-Providence, to bump it up to 5 percent.
While the majority of Republicans joined the Democratic leadership against Segal’s proposal, one Republican broke ranks.
“Our mission is not to give breaks to people who can afford it,” said Rep. Joseph N. Amaral, R-Tiverton.
The House also voted to close a series of tax shelters that would have cost the state more than $10 million next year.
The vote on the measure was largely split along party lines. House Republicans, like Republican Governor Carcieri, opposed changing the state’s corporate tax code, fearing that it would scare away business.
“One man’s loophole is another man’s incentive,” said Rep. Carol Mumford, R-Scituate. “And it’s an incentive to do business in Rhode Island.”
But Costantino said the perceived “loopholes” benefited large multistate corporations above local business.
An estimated 10 to 20 companies operating in Rhode Island — primarily large banks and major retailers — use loopholes to reduce their tax liability. The vote prevents companies from using real estate investment trusts and passive investment companies, which currently allow corporations to save by paying an out-of-state subsidiary to manage its property and “intangible assets” such as its own corporate logo.
Rep. Nicholas R. Gorham, R-Coventry, held a yo-yo to reinforce the point that lawmakers were inconsistent with their tax policy. “You know what we look like? A bunch of yo-yos,” he said.
Lawmakers spent about an hour debating whether to allow car dealerships to open from noon to 6 p.m. on Sundays. Their ultimate verdict: yes.
The change is expected to produce tax revenue as people buy cars in Rhode Island on Sunday rather than cross the border into Massachusetts and pay sales tax there instead. “These are 20, 30, 40-thousand-dollar vehicles that we’re losing 5 percent on,” said Costantino.
The House defeated attempts by Republican representatives to kill the Sunday-sales provision and to add a sunset clause so the General Assembly would need to revisit the issue next year.
Dealership owners “work 14-hour days 6 days a week,” said Rep. Mumford. “They need Sundays” for relaxation and family time, she said.
Mumford’s comments prompted Rep. Timothy A. Williamson, D-West Warwick, to comment that it was unusual to find Republicans sticking up for workers’ rights. “This must be bizarro world,” he said.
Lawmakers voted to use $153 million from the sale of tobacco-settlement bonds to balance the budget, following the recommendation of the House Finance Committee.
In his original budget proposal, the governor outlined a plan to raise $160 million through the sale of the bonds, but suggested that revenue be used for capital improvements and transportation projects.
Watson, echoing the governor’s concerns, accused the Democratic majority of “squandering” the tobacco money. “These tough budgets are going to continue to come our way,” he said. “And guess what? The tobacco money is gone.”
Costantino blamed the Carcieri administration in part for the need to spend tobacco money on the operating budget.
He said that state departments overspent in the current fiscal year by $20 million. “That … overspending could have been the 3 percent for education.” The leadership has also cited the need to use tobacco money because an $80-million settlement from the insurance giant American International Group was tied up in litigation.
The House approved a measure to pay $71 million for a new Blackstone Valley Courthouse.
The vast majority of the chamber voted for the proposal, but a vocal Republican minority sought to block the move.
John A. Savage, R-East Providence, tried and failed to eliminate the funding for the courthouse entirely.
“In this budget year, we can’t afford it,” Savage said. “It’s not the time. It’s not the place.”
Rep. Peter F. Kilmartin, D-Pawtucket, disagreed.
“If anything, it has positive impact. It’s something that’s necessary,” he said. “You can say we can’t afford it now. But when can we?”
The proposal would cost taxpayers $113 million over the next 20 years, beginning in 2009.
Lawmakers increased registration fees for some types of vehicles and some types of license plates, but they maintained the same rate on the car-tax phaseout.
Starting July 1, Rhode Island residents will pay twice as much — $60 instead of $30 — to register their much-loved vanity plates. Knowing the fee hike might result in fewer people getting vanity plates, lawmakers did not budget for the revenue from vanity plates to double, instead estimating that 30 percent fewer people will choose vanity plates.
The state will also begin charging higher registration fees for heavier vehicles. Anything under 4,000 pounds will still be subject to the current annual fee of $30 (which translates into a $60 total bill when people renew every two years). For vehicles heavier than 4,000 pounds, the annual fee will range from $40 to $140.
Regarding the car tax, the first $6,000 of any car’s value will be exempt from taxation next year. Taxpayers’ actual bills will vary depending on the tax rate in the community where they live, but most taxpayers should see their bills go down as their cars depreciate and the same amount of value is exempted.
The House approved a major reorganization plan that would shift the oversight of the Traffic Tribunal, set uniform terms for all the magistrates, and assign the state Office of Health and Human Services to manage five state health agencies.
The office will lead the departments of children, youth and families, elderly affairs, health and human services, and mental health, retardation and hospitals. But coming fresh off a contentious debate over school funding, some of the Republican legislators went after the Health and Human Services by trying to cut the budget by 3 percent.
Republican Rep. Robert A. Watson’s idea was heatedly shoved off by several Democrats.
The reorganization also lays out terms to create a new state Department of Public Safety by the next fiscal year that would include all of the state’s public safety agencies: the state police, the E-911 division, the state fire marshal, the Fire Safety Code Board of Appeal and Review, the justice commission, municipal police training academy, and the sheriffs and capitol police. The state police superintendent will be the director.
The plan will take effect as early as July 1, 2008.
 | The reading of the verdict: Gilbert Delestre guilty in child's beating death |
 | Sneak peek: The new way to get onto the Iway |
 | Computer software used to teach physics at Portsmouth High School |
More top stories
Most active surveys
What else can R.I. do right now to get the economy going?
What's your favorite breakfast/lunch place?
How will the closing of the two DMV offices affect you?
Is Hillary Rodham Clinton a good choice for secretary of state?
Most e-mailed in the last 24 hours
Popular Stories
You must be logged in to contribute. Log in | Register Now!
You are logged in as screenname | Log Out
You are logged in, but do not have a "screen" name. Update Your Profile