WITH the hard work of passing the Rhode Island state budget behind us, it is time to step back and reflect on what we have accomplished, and where we go from here.

The success of this year’s budget was the result of bipartisan cooperation, and a spirit of compromise rooted in the understanding that mitigating our state’s fiscal crisis demands sacrifice, hard decisions and a commitment to future prosperity. In the end, the House, the Senate and Governor Carcieri, all working tirelessly, put forth a balanced budget on behalf of the people of Rhode Island.

I am proud to say that we not only balanced the budget, but we did it without any broad-based tax increases, and while increasing school funding.

Still, there are challenges ahead, both in the coming fiscal year and beyond that. How we navigate this uncertain terrain will make all the difference in whether this year was just a holding action or the start of a real movement toward a steadier fiscal footing.

In the short term, the fate of this budget is still uncertain. Through their management of state agencies, as well as our Medicaid and personnel systems, the governor and his department heads must put the savings enacted by the Assembly into practice, and avoid the rocky shores of fiscal imbalance.

The Assembly will conduct the necessary oversight to make sure that we follow the straight and narrow path. We will be especially watchful of personnel spending and savings, and the progress of the global waiver, which can help move people out of nursing homes and into home-based care but demands careful planning to ensure that we save enough for future years. Most departments have less to work with this year; yet we must ensure that they live within their appropriations if we are to end the cycle of unmet budget savings and overspending that hinders progress from an economic rut.

So many families here are caught in the undertow of the downturn, struggling and making painful choices to pay for the rising costs of food, energy, health care and school tuition, not to mention the mortgage or rent. Our state agencies and departments must take their situations to heart, spending within their means to keep the state from being pulled into the riptide.

There are some major tenets that can guide us toward a more prosperous future, if we are bold enough to act.

First, there must be a commitment to job growth and economic development. Creating the conditions that attract businesses large and small to invest in Rhode Island will make all the difference in the coming years. To do that, we need an aggressive economic policy that promotes Rhode Island’s inborn assets and natural resources.

We need to play to our strengths. In some cases, that means promoting policies that build on our core sectors — such as a water-use policy that can attract even greater investment to our already thriving biotechnology industry. More broadly, it means making Rhode Island’s public-education system as a whole nationally competitive, turning brain drain into brain gain.

We must also get our state’s institutions of higher learning — private and public — into the job-growth game. Knowledge-based jobs are good jobs, and knowledge-based economies are job growers. Brown and the Rhode Island School of Design are world leaders in biomedical technology and design. The University of Rhode Island graduates top-class engineers each year. Connecting higher education with industry is a proven model for success, and that connection needs to happen well before graduation day. Our universities should forge the institutional connections that give more students the opportunity to join, start or grow a business in Rhode Island.

Crucially, an aggressive economic policy must look at the bigger picture. Right now, you can stand on top of the Bank of America Building on a clear day in Providence and see what our economic planners seem to have missed: We have the Route 195 relocation project, the East Providence waterfront-redevelopment effort, potential airport expansion, and not one but two under-used ports. You can see a lone wind tower standing above Portsmouth. All of these major infrastructure projects are happening concurrently, yet being planned independently, and the result is a major missed opportunity to set Rhode Island on course for sustained economic growth.

Managing our state’s spending is another critical task. Wouldn’t it be amazing if department heads didn’t ask for a supplemental budget? Wouldn’t it be incredible if we made a committed effort to consolidate our health and human services system, making it more efficient and more user-friendly for Rhode Islanders?

The savings that we built into this year’s budget must now be acted upon. If there are practical or bureaucratic delays in the global waiver, the administration needs to explore alternative ways to attain those savings by redesigning our system of care.

Yet even as we seek savings on behalf of the public purse, our responsibility to the public good demands that we define our obligation to our state’s neediest citizens. The Rhode Island Public Expenditure Council and the United Way deserve credit for working to pinpoint the standards for our social-safety net; they must continue and complete that important work.

Again, there is much to be proud of this year. We have put in place a predictable tax policy, and must adhere to that course. We have reduced but not erased the structural deficit. We have recommitted ourselves to public education. While items like the historic tax credit were scaled back, millions of dollars of projects are in the pipeline.

We need to keep working though our frustrating fiscal situation. From higher ground and more stable economic footing, new opportunities will come into view: We can be creative on health care, education and economic policy once we have the ability to make the initial investments that major reforms demand.

We have taken the first, hopeful steps toward that higher ground with this year’s budget. From across this great state, Rhode Islanders saw their elected officials come together this year in the face of crisis to secure a way forward for taxpayers, businesses, workers and families. Step by step, brick by brick, dollar by dollar, we are building a more prosperous future, and this year’s success should give us confidence for the challenges that lie ahead.

Steven M. Costantino (D.-Providence) is the chairman of the Rhode Island House Finance Committee.