Ev’rybody’s Talkin’ ’bout ALEC-Seein’, Rep. Jon Brien, Taxes Bein’, Workers’ Pleadin’

Whisper the name Rhode Island in the New York Times and the Earth shakes. Or Twitter does. In the space between Connecticut and Fall River, Massachusetts, anyway.

And that’s what Joe Nocera did, with a column striving to pin the woes of the City of Woonsocket on ALEC:

Or maybe it’s not so incredible. It turns out that one of them, Jon Brien, is also on the national board of the American Legislative Exchange Council, or ALEC. Although ALEC is probably best known for its support of the Stand Your Ground law in Florida, the conservative group has a very clear agenda for dealing with state budgets. It wants to shrink them. Although Brien has denied that he is applying the ALEC philosophy to his small city, it looks, in fact, as if that’s exactly what he is doing. It’s not pretty.

Woonsocket’s problems stem from the decision of Rhode Island’s previous governor, a Republican named Don Carcieri, to balance the state’s budget by cutting state aid to the cities. All of Rhode Island’s poorer cities had become dependent on that aid, so when the economy soured, they essentially ran out of money. Providence had to renegotiate the retirement benefits of its municipal workers. Central Falls actually sought bankruptcy court protection — and a receiver was put in charge of its finances. As for Woonsocket, its current difficulties came to light last fall when the school district revealed a huge, unanticipated budget shortfall.

As Ian Donnis reports, Rep. Brien (a Democrat, by the way) dubs Nocera’s missive “a hit piece.”  David Scharfenberg, of the left-wing alternative paper the Providence Phoenix, insists that Nocera’s roping ALEC into the Woonsocket mess is “far-fetched.” Josh Barro took to Bloomberg.com to argue that Nocera is “wrong, wrong, wrong”; Woonsocket has collected a budget-busting level of debt, which WPRI’s Ted Nesi has found a Moody’s chart to illustrate.

That a Times columnist would stretch the bounds of logic for a political hit on an effective conservative organization is perhaps not news.  That he quotes local progressive-activist journalist Bob Plain might be, at least locally.  The tune that Plain uses the spotlight to sing, though, deserves broader consideration:

Here’s the rub.  Pensions are not the core problem in Woonsocket.  Yes, Woonsocket has a pension shortfall, but it is more manageable than many other places and has almost nothing to do with the current crisis. “The meme in Rhode Island is that if there is a problem, you can trace it back to the public employees,” says Bob Plain…

Nocera’s naked error on pensions and public debt is not the only point against Plain.  Even modestly observant readers will note that neither of them bothers to consider the role of ever-growing school budgets in the face of a 10-percent drop in enrollment.

Still, Nocera was clever enough to build in an escape hatch when he wrote that “cities had become dependent” on state aid.  Thus, he transfers blame to the folks who sought to reverse that dependency.  He makes no mention, naturally, of the fact that the Democrat General Assembly ultimately implemented the cuts but refused to pass along Governor Carcieri’s proposals to empower cities and towns to reduce expenditures, such as through the elimination of state mandates.  Disputants will pick a side to blame and stick with it.

Be the ideological battle as it may, observing that many of the decisions that led to Woonsocket’s debt suffocation predated the Carcieri-era cuts is only the first depth of analysis.  Woonsocket is arguably Rhode Island’s poster child for deeper problems.  Between the 2000 and 2010 Census surveys, Woonsocket was near the top of the in-state list for lost population, employment, and median income.  Consequently, the city slipped toward status as the poorest in Rhode Island, with Providence and Central Falls actually gaining ground.

From the first quarter of 2011 to the first quarter of 2012, Woonsocket’s single-family housing market was one of just a few in RI to see, simultaneously, a drop in sales (-22.6%), growth in inventory (28.8%), and a drop in median sales price (-21.3%).  That’s a sign of a fleeing population.

Ultimately, a drop in public-school enrollment is not only notable as evidence that the district should be trimming expenses.  It is also an indication that young, active, community-building families are not filling the city with vibrant activity and tax revenue.

Two lessons should be gleaned from this painful picture.  The first is that limiting tax growth and shrinking government is more than a conservative shibboleth; in Woonsocket’s case, it might just be a practical imperative to stop the bleeding.  The second is that Plain is correct: public employees are not the heart of the problem.  Rather, the heart of the problem is the whole government-centric approach of Rhode Island governance.  The state needs a dramatic change to spark the private, self-reliant action that can fill the economic balloon long term.

ALEC is clearly not the bogeyman that Nocera needs to pin Woonsocket’s fate on small-government policies, but maybe it ought to be a guide for moving forward.

  • The real problem in Woonsocket and most of the rest of the state is incompetant elected officials and finace directors and union contracts. When Carcieri cut the budget Westerly set up a Plan B committee which was part School Committee members and Town Council members. We ended that year with a surplus. We also found tons of money in the school budget. We then adjusted and continue to adjust contracts as they come up. Town employees have had 401ks for years. Everyone is somewhere between 15 to 20% co-pay for insurance. Everyone is going to 20% as the contracts continue to come up for renewal. Woonsocket and the rest of the towns are UNWILLING to do the hard work required to to get their budgets under control.

  • John Ward

    All employees in Woonsocket pay between 15 and 20% towards their health care, our employees are close to the lowest paid municipal employees in the state, the local pension plan was closed in the 1980’s so that everyone is in the state retirement system (something outside of our local control and requiring a 100% ARC payment each year).

    Justin is right, our population of young families has been leaving the city for other states or our suburban neighbors. The trend has been happening since the 1980’s. Our state and federal mandated obligations to population of increasingly needy students and the 11% living in housing that contributes no property taxes to our local levy work against us when we attempt to reduce costs to deal with the lagging revenues.

    Westerly, on the other hand, has made great decisions, but will never face the challenges of a Woonsocket. Their property value at 3.5 times the value of Woonsocket combined with the extreme wealth of their seasonal taxpayers (having no students attending the schools) make the job of raising property taxes at 1% of total value versus Woonsocket’s 2.9% a slightly easier task for a community with a median family income that is 50% higher than Woonsocket. Comparisons are simply unreasonable.

    While Westerly lost just under $3 million in state aid that needed to be made up with an increase in their $60+ million levy, Woonsocket had to make up for the loss of over $9 million in state aid with increases to the $45 million levy. State and federally mandated service obligations prevent poor communities from shrinking local government to levels affordable to their taxpayers.

    It makes us an easy target for those living in wealthier communities, including those who move out of Woonsocket to escape the poverty. I don’t like the situation, but my choices are to work to solve the problem or simply escape Woonsocket (and possibly Rhode Island entirely) and criticize from afar, unaffected by the challenges and comfortable in my state of condescension.