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Funny How Rhode Island Works

Readers know that I’m not a fan of our campaign finance regime.  It imposes a complicated, intimidating set of laws for grassroots candidates and groups that creates opportunity not only for prosecution of them, but also political attacks on their donors.

I have a hard time, therefore, getting worked up about the apparent probability that the campaign of Democrat Speaker of the House Nicholas Mattiello funded a mailer allowing Republican Shawna Lawton to endorse him in a high-profile way against his Republican challenger, Steven Frias.  To the extent the activity is illegal, it is because of this complex, unconstitutional labyrinth we’ve built, with incentive to find workarounds.

That said, the investigation is unearthing an education in the way Rhode Island politics work, and the stunning thing is that the most objectionable things are treated as incidental… and they’re all completely legal.  I’ve already highlighted one connection:

House Speaker Nicholas Mattiello has put Edward Cotugno, the mail-ballot guru who helped him eke out an 85-vote victory in 2016, back on his campaign team and given his son a $70,000 a year State House job.

Mattiello, D-Cranston, hired Michael Cotugno as the legislature’s new associate director of House constituent-services.

Here’s another:

Included in the evidence packet that the board provided to The Journal on Friday, in response to a records request, was an Aug. 14, 2016, text from “Teresa” to [political consultant] “Jeff” [Britt] and his partner, Daniel Calhoun, who is still listed as a $60,891-a-year legislative employee on the state’s transparency portal.

Think of this.  Under Mattiello, the legislature has given well-paying legislative jobs (of unknown difficulty) to the son of his “mail-ballot guru” and the man who shares a nice Warwick house with one of his campaign operatives, and the thing we’re supposed to be upset about is a relatively small contribution toward political free speech!

But arguing that the campaign finance investigation is the only reason we know about the rest doesn’t justify burdensome campaign finance laws.  When people act in suspicious ways (like endorsing people of other parties or independent spoiler candidates), we should… well… suspect them of having some ulterior motive, unless they can express a persuasive rationale for the odd decision.  And if somebody who benefits from that persuasion wants to fund it, their money doesn’t change the validity of the argument.

Ultimately, the answer is just to reduce the size of government and the value of controlling it.

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Whom Elected Officials Really Represent

Snippets from the AFL-CIO’s endorsement meeting leave no doubt that Rhode Islanders generally have scant representation when our supposed representatives negotiate with labor unions:

Seeking the blessing of the Rhode Island AFL-CIO’s Committee on Political Education Convention this past Wednesday, elected officials came bearing their own visions of a better world for workers.

If reelected, Gov. Gina Raimondo promised to raise the minimum wage “again and again and again.”

General Treasurer Seth Magaziner said he’d help combat the U.S. Supreme Court’s “Janus” decision by working on legislation to keep government-employee information out of the hands of union-disaffiliation campaigners.

Senate President Dominick Ruggerio, a high-placed Laborers’ International Union official until last year, vowed to work on bills that would allow public-sector unions to stop representing non-members. (State lawmakers this year passed a bill letting police and fire unions do this, but legislation allowing it across government stalled.)

As Providence Journal reporters Patrick Anderson and Katherine Gregg put it, to the labor unions, “all of Rhode Island is a future job site.”  Implied is that this perspective leaves government as the mechanism that is able to take money and land and hand it over.  Raimondo would burden our economy.  Magaziner — inexplicably, if one believes his role is to steward taxpayer funds — wants to throw obstacles in the path of those who would help employees to be more independent.  And Ruggerio is intent on lightening unions’ burden while maintaining their near monopoly on employment with government.

By comparison, Republican gubernatorial candidate Allan Fung’s only promise appears to be that he is no longer in favor of right to work laws.  That’s bad enough, but it’s a far cry from a pledge to shape the laws of our land in the unions’ favor even more than they already are.  Interestingly, Speaker of the House Nicholas Mattiello (D, Cranston) is not mentioned in the article.

Two questions arising from the article:

  • Why did “just the phrase ‘right to work'” trigger “tense words between firefighters and building trades workers”?
  • Why didn’t the Providence Journal reporters note that they are members of the AFL-CIO, and did they vote on the endorsements?
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Innovative Ways to Corrupt Government

I suspect this sort of thing (or perhaps more-mild variations) are more common than we know:

“Public records obtained by CEI show a pattern of law enforcement offices turning to off-the-books payments for privately funded lawyers to push a political agenda that was roundly rejected at the ballot box by the American people,” said Horner. “The scheme raises serious questions about special interests setting states’ policy and law enforcement agendas, without accountability to the taxpayers and voters whom these law enforcement officials supposedly serve.”

These public emails and documents reveal the details of an unprecedented, coordinated effort between environmental groups, plaintiffs’ lawyers, and major liberal donors using nonprofit organizations to fund staff, research, public relations, and other services for state attorney general offices. One nonprofit uses a center, established by former New York City Mayor Michael Bloomberg, to pay for Special Assistant Attorneys General (SAAGs) for the AG offices that agree to advance progressive legal positions. Offices that have taken on board a privately funded prosecutor are Maryland, Massachusetts, New York, Oregon, Washington, and the District of Columbia. Senior attorneys from the activist AG offices have even flown in to secretly brief prospective funders of another nonprofit, Union of Concerned Scientists, which has recruited AGs and served as their back-room strategist and advisor on this since at least 2015.

Government has so much power that special interests will inevitably seek innovative ways to leverage it.  Yesterday, my Twitter stream was full of investigations into relatively low-dollar campaign finance questions concerning relatively unknown candidates for office, as if the inherent corruption of big government’s every day operation is less scandalous!

However one balances newsworthiness, the solution is the same: shrink the size and authority of government and thereby reduce the incentive to invest in corruption.  Unfortunately, people tend to support big government because they want it to do a particular thing.  If their fellow citizens disagree and bring about an elected government that is less inclined to do that thing, they’ll seek other means.

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The Balance of Freedoms in Rhode Island

A thousand discussions could be sparked by the Cato Institute’s Freedom in the 50 States ranking and Rhode’s Island’s 42nd place ranking.

The datapoints that go into the index cover a wide range of issues and are subjective.  For example, Rhode Island is number 1 in “marriage freedom,” largely on the strength of its same-sex partnership laws, but some might suggest that the use of government to redefine a cultural institution is hardly a marker of freedom.  Some might also note that same-sex marriage accounts for 2% of a state’s overall score while religious freedom accounts for only 0.01%.

On the other end of the spectrum, the only area in which Rhode Island is dead last is asset forfeiture. However, another low rank for the state could arguably be considered its defining problem: labor market freedom.  Here, our 49th place ranking results from laws on:

  • General right-to-work law
  • Short-term disability insurance
  • Noncompete agreements permitted
  • Minimum wage
  • Workers’ compensation funding regulations
  • Workers’ compensation coverage regulations
  • Employer verification of legal status
  • Employee anti-discrimination law
  • Paid family leave

The total effect of these policies has been that Rhode Island hasn’t budged from 49th since the first year measured: 2000.

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Rhode Island has a great deal going for it, but if people can’t find work here, they won’t live here.  The Ocean State is roughly in the middle fifth for fiscal and personal freedom — although dropping from 18th to 27th in fiscal freedom from 2000 to 2016 and from 12th to 31st in personal freedom.  If we take Cato’s weightings as our guide, that decline has been making life less free.  But those changes pale in comparison to our languishing at the edge of the bottom fifth in regulatory freedom throughout, and that’s an area in which we need great resolve and quick action to improve.

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Michael Riley: Rhode Island May Have Dodged a Bullet, No Thanks to Our Treasurer

In assessing the effort to keep the PawSox in Rhode Island, it is important to review the role of General Treasurer Seth Magaziner. The state treasurer was asked to analyze the costs and opine on affordability, as would be expected with a large borrowing like this. Mr. Magaziner opined in October 2017 and in June 2018 as numbers changed along with the terms of the deal and then opined again recently, finally giving a nod to the deal.

But what everyone needs to know is that $350 million dollars in debt for Pawtucket’s other post-employment benefits (OPEB) for former employees was not used in his analysis. This is more than twice the city’s pension debt! In fact, it was purposely left out by Magaziner. Including OPEB debt would obviously have made the City of Pawtucket’s borrowing look dangerous and ill-conceived. Ignoring OPEB allowed for an outrageous abuse of taxpayer dollars by the treasurer.

Think about it.  Seth Magaziner violated his own risk recommendations by hiding a liability in his analysis; this is the type of stuff they did with 38 Studios. Mr. Magaziner owes it to taxpayers to lay all the cards on the table and not to fall in line with political winds. Had he actually laid the cards on the table, looked at all the debt, and been transparent and honest, the PawSox deal would appropriately have never seen the light of day.

As can be seen in the comprehensive Debt Affordability Study, Pawtucket already exceeds Magaziner’s limits for debt, along with Woonsocket and Providence, before even considering borrowing for the new stadium or the $350 million in OPEB liability, which the board is to reconsider as a component next year. This $350 million is so significant and overwhelming, it would be irresponsible for any treasurer to think Pawtucket absorbing new debt was a good idea.

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Government Involvement in the Internet Isn’t About Freedom

Here’s something I don’t get:  Not that long ago the word went out that retracting net neutrality rules would end the open Internet as we know it, bringing it all the way back to the distant, dark days of January 2015.  So one would expect new proposals reportedly leaked from Senate Democrats to rev up the outrage machine again.  The plan is extremely broad, but a major plank is requirements for verification of users’ identities (at least for non-hackers), as well as…

Other proposals include more disclosure requirements for online political speech, more spending to counter supposed cybersecurity threats, more funding for the Federal Trade Commission, a requirement that companies’ algorithms can be audited by the feds (and this data shared with universities and others), and a requirement of “interoperability between dominant platforms.”

The paper also suggests making it a rule that tech platforms above a certain size must turn over internal data and processes to “independent public interest researchers” so they can identify potential “public health/addiction effects, anticompetitive behavior, radicalization,” scams, “user propagated misinformation,” and harassment—data that could be used to “inform actions by regulators or Congress.”

Of course, this proposal and net neutrality are only at odds if the people pushing either attempt to use the rhetoric of freedom.  If the goal is government control of the Internet, then they’re both perfectly in line, in which case net neutrality supporters were either deceived or have an unjustifiable faith that government overlords will always favor the content they desire.

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The Lead Questions from the Other Side of America

Somehow, it seems like the sorts of questions that John Hinderaker posed the other day don’t seem to be asked very often in the course of reporting on national political scandals.  Yesterday, I summarized the two sides on the scene, and I think it’s important for people in Rhode Island to understand that there are live questions not answered by the standard Democrat-media talking points.

Here’s a marker of what many of us have no sense we don’t know:

Time was getting short for the insurance policy.

Four days later the same team was emailing about rushing to get approval for another FISA warrant for another Russia-related investigation code-named “Dragon.”

I confess that I can’t keep up with the ever-expanding FBI scandal, but do we know what “Dragon” is, and how it differs from “Crossfire Hurricane”? Whatever Dragon was, it apparently had to do with stopping the Trump campaign, as Strzok and Page were eager to get it off the ground.

Now, one can reasonably speculate about what direction all this will go, whether there is anything of substance here, and whether peculiar actions by government agents were justifiable, but one can’t reasonably dismiss these questions as a distraction.  At the very least, there is plausible evidence of an actual, honest-to-goodness conspiracy within government to affect our political process and the resulting presidency.

Frankly, I have trouble trusting anybody who encourages us to look away from that.  What do such people not want us to discover, or is their real fear that they’ll lose their ability to do such things in the future?

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Incentive for a Disability

News of a former employee of the Rhode Island House Minority office who has filed a disability discrimination lawsuit claiming that Minority Leader (and gubernatorial candidate) Patricia Morgan discriminated against her raises a topic to which our society has perhaps not devoted sufficient debate:

Masciarelli says in her complaint that she suffers from depression, and she alleges Morgan told multiple people she needed to be fired before she was covered under the Americans with Disabilities Act.

Morgan says Masciarelli was fired due to her poor work ethic and she never knew of the woman’s disability. Morgan says she was cleared by the state Commission for Human Rights.

If emotional conditions are going to start carrying the same protections as physical conditions, we’re entering a legal thicket.  When a disability is physical, one can more-easily differentiate between employment decisions that have directly to do with an ability to accomplish necessary tasks and discrimination.  With emotional conditions, where does a “poor work ethic” end and a protected disability begin?

Indeed, the availability of such protections creates incentive for employees to seek diagnoses, and because psychology is more subjective than physicality, fraud would be more difficult to prove.  Even without bringing fraud into the picture, though, doesn’t anything that creates incentive to have a mental health problem make it less likely that the person will overcome it?

How long, one wonders, until people begin to claim that the stresses of their jobs created the hazardous (i.e., stressful) condition circumstances that led to emotional disabilities?

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In Rhode Island, Everything’s in a Name

The Rhode Island House Republicans’ Twitter account tweeted out a bit of deep insight from Mike O’Reilly of the Federal Communications Commission on C-SPAN:

“I was dealing with Rhode Island. They decided they were not going correct it, withstanding all the promises early in the year. They rename the program for the following year, thinking it’s going to fix the problem.” FCC Commissioner @mikeofcc

He’s talking about the 911 fee that the state government has come under scrutiny for misappropriating, but this is common in Rhode Island.  After 38 Studios, the General Assembly changed the name of the Economic Development Corporation (EDC) to the Commerce Corporation and, voila, all is right with Rhode Island policy.  In the season of education reform, Rhode Island shifted some names and org charts of state-level education boards around and all of a sudden children began a new educational voyage… I guess.

Once again the reminder:  Elected officials will keep doing this stuff until it stops working for them.

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Notable Powers for Notary Publics

During our weekly on-air conversations, John DePetro and I have long pondered the increasing significance of notary publics to political campaigns. A campaign with some extra money can deploy people to go out and get votes by bringing absentee ballots to them and signing off on their signatures.

Today, John noticed a statement from Secretary of State Nellie Gorbea touting the General Assembly’s passage of legislation implementing “a model” that only 11 other states have pursued “designed to standardize notarial requirements and procedures.” I’ll freely admit that my knowledge of the subject leaves me unable to assess how different the provisions of the new law are to current practice, but whether the following provisions will be new or are already in place, they are conspicuous in light of this increase in the prominence of political notaries:

  • Another person can sign for somebody who is “physically unable to sign a record.” That inability is not defined, but it seems likely to include not only physical impairment (like broken hands), but also an inability to write for any other reason. (“Physically,” in this reading, would be meant as a distinction to prevent people from signing for somebody who can’t sign because he or she is somewhere else, for instance.)
  • Notaries in other states or even other countries would be able to verify signatures.
  • Notaries could accept “signatures” by digital technology, meaning “an electronic symbol, sound, or process.”
  • Notaries don’t need to check ID if “the individual is personally known to the notarial officer.”
  • To the extent that ID is needed, a notary can accept IDs that have expired within the prior three years.
  • “Errors” don’t carry any penalty unless they can be shown to be outright fraud.

In short, it’s very easy to see how notaries could haul in votes as if with fishing nets even without doing anything fraudulent, and be separated with several layers of ambiguity from actual fraud.

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The Conditions Under Which Progressives Will Lease Us to Businesses

One last minute bill in the Rhode Island General Assembly, H8324, may or may not be going anywhere, but it’s worth a look as an educational exercise.

Very simply, it would require any “hosting platform” (e.g., AirBnB) that allows people to “offer any property for tourist or transient use” to be responsible for making sure that the rentals are in compliance with state and local laws and regulations.  It would also require the platform operators to take a more active role in the collection and transfer of all relevant taxes.

This little change in law, affecting a narrow portion of a single industry in the state, carries some important questions of the sort that we don’t consider thoroughly enough.  What is the nature of commerce?  Who works for whom?  Who has responsibility for whom?

From a free-market perspective that starts with the individual as the origin of all economic activity, the property owners are responsible for the product that they are offering, and the hosting platforms work for them.  Because they are the constituents of state and local government, they have a say in that government and can arguably be said to have consented to granting it some authority to regulate their activities.

The progressive perspective that has long been insinuating itself into Rhode Island government and encroaching on Rhode Islanders’ rights is very different.  That view doesn’t begin with individuals as autonomous sources of responsibility and power.  The Rhode Islanders seeking to rent their property don’t truly have ownership of themselves.  Rather state and local government has claims on their activities, and the hosting platforms own their rental businesses.  It is therefore reasonable for the government to require platforms to make sure that their workers comply with its requirements.

From a free-market perspective, a government that imposes requirements on people might create incentive for them to hire a contractor to do tasks for them — for AirBnB to provide inspections for regulatory compliance, for example, with an extra fee.  But from a progressive perspective, the government has a right to tell companies that intend to draw profits from its people what conditions they must impose, or else they cannot do business here.

In other words, progressives implicitly believe that the government is renting us out to the companies.

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A Big Lesson from a (Relatively) Small Tax Increase

I’ve got an op-ed in the Valley Breeze today taking the opportunity of a new sales tax on software as a service products to illustrate the harmful thinking of our legislators:

In short, the state government is going to tax an innovation that empowers productive, motivated Rhode Island families who are making the most of technology that levels the economic playing field. Even if it’s “only” $4.8 million, why would the state government do that? …

So, when Speaker of the House Nicholas Mattiello, a Democrat from Cranston, tells reporters that “to not expect (the budget) to rise every year is not realistic,” he’s really saying it is unrealistic to expect state government only to grow at the same speed or more slowly than the household budgets of Rhode Island families. If that’s the expectation, then the governor and the General Assembly must find new ways to take more money from Rhode Islanders.

After all, the politicians have to find some way to pay for election-year raises for unionized state employees. If they’re going to increase the tax credits for producers who film movies here, they’re going to have to start taxing your Netflix account. If they’re going to promise a big chunk of the state’s income, sales, and corporate taxes to the PawSox for a new stadium, they’re going to have to increase those taxes even more to break even.

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Bowling Subsidies Now!

Appearing on Rhode Island Public Radio’s “Political Roundtable” show, recently, Rhode Island House Minority Leader Patricia Morgan, who is running for governor as a Republican, had an exchange with political analyst Scott MacKay:

MacKay: It sounds, in a way, like you don’t really care whether the PawSox go or not.  Do you realize this is a part of Rhode Island culture and family entertainment that hundreds of thousands of people go to every year?

Morgan: I do understand, and I have taken my children, as well, to the PawSox stadium, but I still believe it’s a private company at this point.  We can’t build a facility for every private company.  I mean, why don’t we build bowling allies; a lot of families like to go bowling.  Why don’t we build miniature golf entertainment areas?  At some point, we really have to keep taxpayer monies for the things that actually are economic development, will actually build good jobs in Rhode Island.

Morgan should have concluded that thought by saying we have to keep taxpayer monies for things that are actually government responsibilities, but her point is otherwise right on.  The problem, however, is that conservatives can’t win this sort of reductio ad absurdum argument with progressives, because the latter will happily say, “Go ahead.”

Perhaps progressives won’t generally have the personal affection for bowling or mini-golf that they have for baseball, but nobody should doubt that they’d be happy to use government resources for family entertainment if somebody were to credibly propose doing so.  After all, family time is very important.  Why shouldn’t government build facilities to foster it?  Isn’t government supposed to do everything important for us?

Of course, the conservative reply might be that the lack of a private market for a bolling alley in a particular area is simply evidence that people aren’t interested in that activity in sufficient numbers to make it worthwhile.  But however inexpensive the activity is, there might be some families that would jump at the chance if the price came down a little and who, without that opportunity, instead spend their time doing unhealthy things isolated from each other.  And hundreds of thousands of Rhode Islanders have fond memories of bowling with their families.

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FY19 Budget: When Government Outgrows the Governed

With the House budget released, the RI Center for Freedom & Prosperity has updated its annual chart showing how the state’s spending has actually grown during this century versus inflation and population.  As you can see, it isn’t a pretty picture:

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For some perspective, the state budget has grown at a compound annual rate of 3.9% per year.  Inflation’s growth rate, by comparison, has been 2.0%, and the population’s has been 0.0%

Granted, for the ease of the comparison (and making it easy to repeat), we’ve just used the national inflation rate, here, and people periodically argue that some other metric would be preferable.  Well, using data from the Bureau of Economic Analysis, personal income in Rhode Island has grown at a rate of 3.0% per year, and the state’s gross domestic product (GDP) has grown at 3.1% per year.  (Both of those are current, unadjusted dollars.)

That means year after year, the state government eats up more and more of the Rhode Island economy and takes more of Rhode Islanders’ real income.  Over the period shown in the chart, the state government has grown to the point that it’s taking another two percentage points of income and GDP out of the economy each year.

Even worse:  This isn’t just a loss to the people right now.  It actually affects broader economic growth, and likely plays a significant role in Rhode Island’s economic growth rate coming in below the national GDP rate of 3.8% over these two decades.

This is why Rhode Islanders often feel like they are serving the government, not the other way around.  Few people would complain about the growth of government if the people of the state were becoming relatively wealthier, but that it’s the other way around.

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Missouri Takes the Obvious Step for Hairbraiders

Missouri has taken a step that Rhode Island should follow:

Previous state legislation in Missouri had required people who wanted to braid hair for profit to obtain a cosmetology license — which required the completion of 1,500 hours of training.

This requirement was time-consuming, expensive, and created an unnecessary obstacle that made using one’s knowledge and skills to earn a living more difficult. Furthermore, it mostly affected women of color, who primarily make up both the customers and the braiders.

The requirement was yet another example of the ways regulations hurt everyday Americans’ ability to provide for themselves and to pursue their own economic liberty.

We can discuss in a more rigorous way when licensing is needed.  Is the use of chemicals a line?  Should it be a matter of life and death or contagion?  But surely, when one person consents to give money to another to braid her or his hair, the government doesn’t have to be in the middle of that transaction, especially to require a license for something that hair braiders don’t actually do.

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When the Chief Executive Is Often Somewhere Else

One can’t help but combine the news Monique highlighted here — that the administration of Democrat Governor Gina Raimondo missed a critical deadline for appealing a costly legal ruling — with today’s “Political Scene” in the Providence Journal:

As a champion fundraiser, economic-development cheerleader and devoted Yale Law School alum, Gov. Gina Raimondo has been out of state on official, or political, business at least 90 days since the Jan. 1, 2017, midpoint of her term as governor.

Her travels during this stretch took her to New York, Connecticut, Massachusetts, Arizona, Illinois, Pennsylvania, Colorado, Texas, Oregon, Michigan, California, North Carolina and Washington, D.C.

All of these trips were identified in a summary provided to Political Scene by the governor’s office as either “official” (27), “political” (19), or “mixed” (15). The trips categorized as “official” included her Harvard Class Reunion in April, which her staff described as a valuable networking event.

We can discuss the (unknowable) variable of how often prior governors were out of state and debate the importance of Raimondo’s trips to the people of Rhode Island, but the plain reality is that her administration has faced repeated problems executing its responsibilities, and at the same time, she has been traveling far and wide, burnishing her own brand and collecting unprecedented money for her political interests.

I commented recently on a fundraising email from the Raimondo campaign emphasizing the importance of donating money in order to support the policies of the Raimondo administration, so it’s possible the Raimondo camp believes its fundraising in order to buy the next election to be a long-term benefit to the people of Rhode Island.  Those of us who must live with the consequences of government policies should probably give some thought to whether that interpretation matches their own assessment of a governor’s responsibility.

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UPDATED: Latest Stunning Display of Incompetence by Raimondo Involving our Most Vulnerable May Cost Taxpayers Tens of Millions

Both the Providence Journal‘s Kathy Gregg and WPRI’s Ted Nesi are reporting today that the State of Rhode Island, more specifically, the Executive branch’s Office of Health and Human Services (the Rhode Island Executive Branch being currently occupied, we should note, by Gina Raimondo), missed a critical court deadline to appeal a court ruling and thereby may have put state taxpayers on the hook for “$8 million annually for each year starting in 2016-17″. From Ted Nesi’s story about this disturbing and jaw-dropping situation:

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When Government Can Get a Project Done Early

The week before Tiverton’s financial town referendum (FTR), I reported that state estimates of revenue from the Twin River casino in Tiverton were based on a September 1 opening — a full month before earlier estimates and two months before the date that some preferred for local purposes.  The budget that I submitted, Budget #2, which would have reduced the tax levy by 2.9% and finally brought our tax rate back into line with neighboring Portsmouth’s, used the September 1 estimate (although with revenue estimates still lower than the latest from the state).

Well, wouldn’t you know it, the week after the town government’s higher-tax budget won the referendum, with questions about casino revenue front and center, Twin River could no longer contain its enthusiasm and proclaimed:

Twin River beat the odds and will get gamblers to the tables a month earlier than expected.

John Taylor Jr., chairman of Twin River Management Group, said the casino will open on Sept. 1 instead of the previous forecast of an Oct. 1 opening.

In the past, the elector petitions have tended to win by 60% versus 40%, but this year Budget #2 lost roughly 45% to 55%.  The Budget #1 advocates managed to erode or eliminate the typical margin relying heavily on exaggerated warnings about what would happen if the assumed casino revenue didn’t materialized.  The victory, however, arguably came from the defection of people who typically vote for the lower-tax budgets but found use of the casino revenue to conflict with their conservative inclinations.

In fairness, on our side of the aisle, when we talk about government projects, we tend to assume that they can never come in on time.  In this case, that assumption misses the key fact that the state government is relying on this revenue.  Roads, bridges, and public works projects can take forever because the money is endless and the economic downsides primarily hit the private sector.  The casino is part of a race to get ahead of the competition with other states.

Twin River’s optimism may still prove to be misplaced, but it looks unlikely, and frankly, my expectation is that the initial revenue estimate for the town is likely to prove to be about half what comes in.  We’ll see.

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The Coy Calculations for Sports Betting

I’ve got a post on Tiverton Fact Check that might be of some interest statewide.  Most of it has to do with the increased expectations for revenue from the Twin Rivers location soon to open in town (which argues against the pessimism that some have about estimates in the 2.9%-tax-reduction budget that I submitted for a vote this week at the financial town referendum [FTR]).  But the introduction of the topic of sports betting has broader implications:

Also this week, the United States Supreme Court “struck down a 1992 federal law… that effectively banned commercial sports betting in most states,” as a New York Times article put it.  Expecting this outcome, Rhode Island Governor Gina Raimondo had already included a provision in her proposed budget for the upcoming fiscal year suggesting that referendum votes across the state and in Lincoln and Tiverton had already provided authority for the state to conduct sports betting.  She estimated $23.5 million for the state from this source.

However, no language yet exists describing whether this betting would count as a VLT, table game, or something else.  Therefore, although Rhode Island is apparently planning to allow only in-person betting, probably at the two Twin Rivers locations, how much the host communities would receive from these transactions is not yet known.  State officials are coy on the matter, even on the way in which the $23.5 million estimate was calculated, but it is clear that negotiations are underway.

I haven’t been able to find any evidence of how the state thinks this money should be attributed or any calculation that led the governor to estimate her millions, even after communicating with multiple state departments.

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