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Gov Raimondo Hands out Another $7M in Tax Dollars In Lieu of Real Econ Development

From the Providence Business News.

The R.I. Commerce Corp. voted to approve more than $7 million in state relocation and redevelopment credits Monday to several corporations that plan to invest in or bring jobs to Rhode Island.

“These are three fine projects that are helping to advance our economy,” said R.I. Commerce Secretary Stefan Pryor.

What is actually needed to advance the state’s economy, Mr. Secretary, is substantive improvements to the tax and regulatory climate to signal to out-of-state businesses (and the jobs they bring) that they can come here and prosper without having to go on BENDED KNEE to state officials for CORPORATE WELFARE.

What is even more disturbing is the revelation that taxpayers are, in fact, being forced to come out of pocket via these subsidies to compensate for the business climate and market conditions created by decades of costly, anti-business policies that the Raimondo is studiously choosing not to address.

The company has developed two other hotel properties in Rhode Island, including the Hampton Inn & Suites in downtown Providence. Like those, this project needs state assistance in bridging the financial gap created by market conditions. In Boston, he said, the company has properties built at similar cost that fetch $300-a-night for rooms. In Providence, similar rooms would be booked at $170 a night.

“But for this supplement, this project would not happen,” Karam said.

Remarkably, at a recent stop on her “listening tour”, Governor Raimondo actually touted the fact that she had increased such taxpayer-funded tax credit and give-away programs as though it were an achievement of her administration!

Rhode Island needs someone at the State House to be the adult here. Minimally, these taxpayer-funded subsidies need to be shut down while we wait for the governor to come to her senses about the real action needed on economic development … or, if that is not going to happen, until the next governor is installed which, hopefully for the sake of the taxpayer’s wallet, will be in two and a half rather than six and a half years.

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UPDATED – Monetized Firefighter Sick Time is Straight Up Rip-Off of Taxpayer

Great, important and infuriating article in the Warwick Beacon a couple of weeks ago written by publisher John Howell. From city documents obtained by taxpayer advocate Rob Cote, it demonstrates that Warwick taxpayers are being compelled to needlessly pay for monetized, unused sick days.

An examination of payroll records and information provided by Fire Chief James McLaughlin show that virtually no paid sick leave is used by department personnel, and that at the end of the year department members get a bonus – in some cases more than $5,000 – for unused sick days.

The total cost to taxpayers for the calendar year ending Dec. 31, 2015, was $442,913.87.

The huge problem here is that the basis for this abuse – sick days – shouldn’t even exist but is a completely unnecessary addition to the firefighter contract because Rhode Island law, Title 45-19-1, effectively stipulates that firefighters and police officers (more specifically, “police officer, fire fighter, crash rescue crewperson, fire marshal, chief deputy fire marshal, or deputy fire marshal”) shall receive unlimited sick and injury days.

This is not a criticism of firefighters but of Warwick officials who have agreed to a contract which includes these completely unnecessary, utterly wasteful provisions funded by Warwick taxpayers. Ken Block, who had previously completed a statewide analysis of the high cost of Rhode Island fire departments, identifies in the article why elected officials have done so.

He reasons payment for unused sick time has simply become a means for elected officials seeking firefighter union support to bloat their pay without making it obvious to the taxpayers who have to foot the bill.

Two things.

1.) Warwick officials, you’re busted. This utterly wasteful practice is a rip-off of taxpayers and needs to end immediately.

2.) What other cities and towns are similarly abusing their taxpayers by including sick days in their first responder contracts? Remember, Rhode Island law (Title 45-19-1) makes sick days completely unnecessary. Accordingly, the presence in any police or firefighter contract of sick days – which can then be monetized and abused – is not out of necessity but due to the selfish motivation of that municipality’s elected officials.

UPDATE

After review of the law and contracts, Justin Katz contacted me to point out a couple of errors.

1. The RI law cited is not quite as blanket about on-duty sick and injury as indicated in my post and the Beacon article. Justin reports:

In order to get injured on duty (IOD) pay, personnel have to file affidavits that they received their injury or contracted their illness directly as a result of their work. Just catching the flu wouldn’t do it. There is justification for having some provision that allows emergency personnel to call in when they aren’t physically up for doing their job for some reason.

2. The Warwick police contract does, in fact, include provision for sick and injury days, though it is far more tightly capped than the fire contract.

The Warwick police contract currently in effect includes separate sections for sick time and injured on duty time, *as does the fire contract,* …

It doesn’t look like the police get to cash in their sick days. However, they do get 8 hours of “miscellaneous time” if they go six months without using sick days.

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Budgets, Hometowns, and Community

Another budget vote at Tiverton’s financial town referendum (FTR) has come and gone, and another elector petition with a tax increase with a zero in front of the decimal point has won.  Counting the second, lower-tax elector petition on the ballot, this year, the split is more or less the same as in prior years, indicating that, at the current level of taxation, not more than 40% of voters are willing to go up much more.

But election analysis, like holding people accountable for their behavior during the campaign, can wait for a bit.  This morning, my mind’s lingering on a higher-level, more-philosophical point.

Just before the vote, a friend commented on the melancholy sense that driving into town after work gave him.  Looking at the beautiful place in which we get to live, he thought about how pleasant it would be not constantly to be watching out for the intrusions of a manipulated government into our lives — that is, if government undertook limited activities, the effort to patrol its actions were widely dispersed, and people with authority generally agreed on their boundaries.  I hear similar statements, but reversed, from friends who move to more-conservative states about how nice it is to live under a government that is properly ordered.

I’ve long intended to write an essay using two one-town islands as an analogy.  New Shoreham is a municipal entity in Rhode Island, but most people are more familiar with the land that it governs: Block Island.  Another large island in the state is Conanicut Island, but people are generally more familiar with its own municipal entity, Jamestown.

How people refer colloquially to geographic areas is typically a matter of historical accident, but the contrast in this case has always struck me.  What my friend was saying, basically, is that he would prefer if we thought of ourselves as living in Sakonnet, an area in which some basic services are partially handled by the municipal entity of Tiverton.

The people who oppose my friends’ activities in town no doubt have a similar feeling that the lack of harmony diminishes their sense of the town, and ultimately, a town of 15,000-16,000 people can accommodate divergent worldviews… except for one complication.  The irreconcilable problem is that one faction in town sees no meaningful distinction between the town government and their concept of “the community.”

Going through the budget, I see expenditures for things to which I would gladly donate more money, if asked, than whatever portion of my taxes goes to them, but some people in town think the community’s responsibility isn’t just to find a way to support such charities, but to force everybody to pay for them.  It isn’t a community activity, in this view, unless everybody is made to participate in some way, usually by funding it.

Such a view can’t help but transform our beautiful space on the bay into either a perpetual battleground or a fiefdom in which only a few are satisfied.

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Grant Inequality is Also by Community

Today’s must-read-as-always Political Scene in the Providence Journal does a good job breaking down the top recipients, both legislator and community-wise, of legislative grants this year. (It was community service, not legislative, grants, that were the subject of the very lame House hearings last week.) Because legislative grants are given out entirely at the whim of leadership, those legislators who are favored are presumably going to get a larger share of the grants. But the result of that selection process is also a disproportionate distribution of grant monies by city and town. Here’s what that looks like.

Of the $537,040 given out by the 10 lawmakers, $113,850 went to organizations in Mattiello’s home district of Cranston, $82,700 went to Providence groups, $42,000 went to East Providence groups, and $38,500 landed in Warren-based organizations.

Legislative grants need to go away, largely because they are unconstitutional. But they also need to be gone because they are obviously unfair. Why should one city or town get more than another? Democrats wring their hands about income inequality. It’s interesting that, when political considerations enter the picture, Democrat leadership on Smith Hill not only tolerates inequality but deliberately creates it via the grant process.

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ProJo’s Fire-And-Brimstone Editorial About Grant Hearings is Spot On

The Providence Journal’s all out, fire-and-brimstone editorial yesterday against the sham House hearings on grants is welcome and fully warranted.

The hearings came across as nothing but a dog-and-pony exhibition, an insult to the intelligence of most Rhode Islanders, a fraud, a farce.

The editorial not only calls for an immediate end to grants but goes on to point out that the line item veto would be a curb on such excesses. (My comment: ahem, yes, in the hands of a Governor interested in wielding it.)

The editorial, further, makes reference to federal authorities.

This is rank enough, but the system has evidently metastasized into funneling money directly to legislators and other allies working for dubious nonprofit groups. If crimes have been committed in this manner, we hope federal authorities bring an iron fist down on the perpetrators.

It is very difficult to believe that leadership is attempting to pass off these Potemkin hearings as the promised review and oversight of the very troubled grant program and that they won’t, in fact, be bringing in independent investigators. If that is the case, however (and I would be thrilled to be wrong here), legislative oversight is pointless and it is clearly time to bring in a phalanx of feds. Grants and every campaign account on Smith Hill: let them go top to bottom. The “stench”, as the editorial calls the miasma emanating from the grant program, will not clear until this happens.

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Grant Hearings: No Hard Questions … Or Even Committee Members Half the Time

Good article by Tom Mooney in today’s Providence Journal about the subcommittee hearings this week on legislative and “Community Service” grants. He reports that not only were no hard questions asked … but testimony was given often with committee members largely AWOL.

But if anyone was waiting to hear if any of the $11.6 million in community service grants distributed this budget year was misused, they’ve been disappointed. One reason is there’s virtually no one around to ask the question.

Following the revelation of an ongoing federal investigation into now-resigned Representative Raymond Gallison and state grant monies sent to non-profits affiliated with Gallison that may largely have gone to his salary, Speaker Mattiello had promised to review all such grants. It is to be sincerely hoped that the intended review will extend considerably beyond these hearings, for which the description “Potemkin” would be generous.

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Pro-Business? DLT Refuses to Cite Basis for Giving Unemployment Benefits to Striking Workers

Two weeks ago, the RI Department of Labor and Training authorized striking Verizon workers to receive unemployment benefits by erroneously labeling the action a lock-out. Not only does this egregiously wrong decision come at the expense of all RI businesses but, if it stands, it could set a costly precedent.

True to their word, Verizon was in Superior Court Wednesday contesting the decision and asking that unemployment benefits “be immediately suspended”. But DLT was not forthcoming, at least publicly, about the basis for its ruling.

[DLT Spokesperson Michael] Healey declined to discuss the evidence or the factual statements that led to Jensen’s decision, telling The Providence Journal that such information is “confidential.”

Two things. Why can’t they discuss the basis for the decision? Is it because it is so weak and indefensible?

Secondly, Governor Raimondo claims to be working vigorously on the economy and the state’s business climate. Does she agree with this blatantly anti-business, pro-union decision by the RI Department of Labor and Training?

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Huh. Why is Vice President Biden Really Coming to RI?

Governor Raimondo says its because her toll-funded

RhodeWorks, a program that is set to charge tolls on some trucks, and other construction projects, has turned heads, including in Washington

But could the real reason be to try and get someone, ANYONE other than those who would directly benefit from it (or is a personal friend of the Governor), to say something good about her toll program? If so, it’s interesting that Governor Raimondo’s administration had to go out of state and all the way to Washington, DC, to find someone to talk up this highly destructive new revenue stream. It would also confirm the generally held view that Governor Raimondo’s toll program, passed by the General Assembly (how did your legislator vote?), has pretty much the same political popularity as a new government Puppy Kicking Program.

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DeSimone Hurts Providence Budget

Uh-oh. Looks like the structural deficit of the City of Providence is about to get worse:

“I know it’s probably not a good business answer, but I make one [property tax] payment at the end of the year and it works. It’s always worked for me … . Other than that, I really don’t have a good answer,” he said. “It’s not a financial issue. Obviously I am paying more by doing it that way [because of fees and interest].”

But DeSimone said he “got hell from my wife” after The Providence Journal ran a story this week about the latest tax-sale threat, and the story “made me think … I really shouldn’t do it that way especially if you want to be the majority leader.

No word, yet, on why DeSimone thinks Providence Journal political reporter Katherine Gregg “want[s] to be the majority leader” or why she would be hampered by DeSimone’s tax-paying practices in that effort.

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Good Grief – No Grants or Any Other Tax Dollars Should Go to Lobbying

Good article in today’s Providence Journal by Patrick Anderson, headlined: “Do R.I. General Assembly grants funnel back into lobbying?”

The answer, in many cases, is “yes, they do”. And for those recipient organizations who use this defense of the dollars they receive from Smith Hill:

Many said they use only non-grant funds to lobby.

Bosh. If your organization does ANY lobbying, grant dollars free up other dollars in your budgets to be used to lobby.

Often, the goal of lobbying is for policies that are antithetical to the best interest of the taxpayer. Accordingly, it is grotesque that tax dollars, whether via grants or any other source, would go to an organization that lobbies any arm of the government of Rhode Island.

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JOI? About that Unemployment Rate, Governor

Governor Gina Raimondo’s approval rating isn’t good and, in fact, is going in the wrong direction due to

a sharp rise in her negative ratings this year, according to a newly released poll.

Asked about this in a couple of different instances by the press, the Governor responded by citing purported achievements of her administration but always including a reference to the state’s dropping unemployment rate – this one courtesy WPRI.

Asked Thursday how she reacted to seeing her approval rating at 41%, Raimondo replied: “I was pleased.”

“You know, it’s early in my term,” she continued. “We’ve been on for a year. We’ve had a lot of momentum. Our unemployment rate dropped.”

Actually, the unemployment rate is an inadequate reflection of the measure of employment as, among other things, it fails to distinguish between part and full time employment and actually counts a declining labor force participation rate as a good thing.

The Rhode Island Center for Freedom and Prosperity has developed a more comprehensive snapshot, called JOI (Jobs & Opportunity Index), of the larger state economic picture, as opposed to the narrow snapshot of the monthly unemployment rate. From the JOI webpage:

JOI is a national index of states that incorporates three major factors, comprised of over a dozen variables derived from government reported data:

1) A proper measure of employment as it relates to labor force,
2) A measure of job/employment levels as compared with public assistance rolls, and;
3) A measure of personal income as compared with government tax receipts collected”

By this measure, Rhode Island ranks forty eighth nationally – not at all a ranking that any state official should or could brag about.

Be sure to keep an eye out for Rhode Island’s JOI ranking as the Center will be updating this important new measure every month when the state’s unemployment rate is released.

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“Field of Trains” Redux: Why Would We Spend Millions for 89 Riders Net Per Day?

The Wickford Junction is an unmitigated disaster. So, of course, it makes sense (???) to strive to repeat it in Pawtucket.

Rhode Island has taken its biggest step yet toward building a new train station to serve Pawtucket and Central Falls, requesting $14.5 million from the federal government to cover about a third of the project’s cost.

But a new train station in Pawtucket would net only eighty nine new riders per day, with hundreds more poached from the South Attleboro and Providence stops. By the way, it isn’t just federal dollars that would be involved.

Separately on Tuesday, the House Finance Committee is scheduled to take up a bill sponsored by Rep. Carlos Tobon, D-Pawtucket, that would appropriate $10 million to help underwrite the cost of the Pawtucket train station. Tobon proposed a similar bill pegged at $20 million last year.

RIDOT is currently looking to fill a $126,648 – $140,920 position of “Administrator, Office of Transit, New Starts, Operations and Transportation Alternatives“. It looks from the job description that this proposed new train station would fall under the purview of this position. Is this taxpayer-funded job the sort of “opportunity to transform the area and provide much needed economic opportunity for local residents” that RIDOT Director Peter Alviti is referencing when he tries to justify this completely unneeded project?

This is serious derangement. The “If You Build It, They Will Come” approach to expensive public transit projects didn’t work in Wickford. We know NOW it won’t work in Pawtucket, either. So why are our elected officials working to repeat Wickford’s costly mistake in Pawtucket?

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The Heritage of Gaspee

May I indulge in a quick word about state representative from Warwick and Democrat Party chairman Joseph McNamara?  The cartoonish pretense of offense that he’s been expressing that anybody would dare criticize his fellow Democrats without exposing their donors to bullying from corrupt state officials and their activist allies is worthy of note, but what’s really been nagging at me is this, from a Katherine Gregg article:

“Unfortunately,” said McNamara, a Warwick state representative, “shadowy conservative groups like the Gaspee Project still get away with underhanded mailings like this with no reporting to the Board of Elections website. I find it disgusting, especially with the use of patriotic symbols like the HMS Gaspee,” McNamara said.

One wonders about McNamara’s sense of patriotism.  To be clear, I’m not challenging his patriotic feelings, but I wonder what they entail.  Frankly, it’s difficult not to conclude that they really are just that: feelings.  Presumably he has warm feelings about his family’s heritage, and he loves the country that’s allowed him to be a person of some small importance in his home state.  But really, what does he feel patriotic about?  I’d bet he’s never really thought about the message of the Gaspee burning or its relevance to modern times.

Consider the details.  Much of the aggression in those early days of our country had to do with high taxes, and high taxes are practically the defining value of Rhode Island Democrats.  The HMS Gaspee, specifically, was on an anti-smuggling mission, and smuggling is nothing but transporting goods for commerce without government approval.  Regulating economic activity might even be more important to McNamara’s comrades than taxing it.

Indeed, McNamara’s entire complaint against the wicked right-wing fliers is that they constitute free speech without government regulation.  In that sense, the Gaspee Project fliers are like smuggled goods, and McNamara wants to send out the ships to stop that suspicious activity.

Sorry, Joe.  Either you’re the bad guy or you have to reevaluate your affection for the incidents that defined the United States’s rebellious origin.  On further thought, you’re the bad guy either way.

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Marijuana Legalization Referendum Not Looking Good This Session – And That’s Good

The Providence Journal is reporting this morning, as did WPRI, that

Chances are dwindling that a referendum on legalizing marijuana will appear on the November ballot in Rhode Island.

“A referendum on this year’s ballot is unlikely,” House Speaker Nicholas Mattiello told The Providence Journal in an email Monday.

This is a good thing, with apologies to my friend Pat Ford and others who support the legalization of cannibis. One of the pro-legalization arguments is that use of the substance is the same as legal liquor. I might, might, might entertain that argument if it meant that the total number of people who use mood-altering substances did not change. But all indications are that this is not what happens.

Further, legalization hasn’t gone wonderfully in Colorado – far from it. When this discussion comes up at the General Assembly next year, these statistics need to heavily weigh on the ledger against the increased tax revenue often cited by cannibis advocates. Colorado’s experience strikes me as too high a price for Rhode Islanders to pay to legalize marijuana.

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Karen MacBeth Will Step Away from Politics Altogether

… that was the startling announcement that State Representative Karen MacBeth (D then R) made on the Tara Granahan Show yesterday on WPRO.

Republican State Representative Karen MacBeth tells WPRO’s Tara Granahan that she has abandoned her short-lived race for Congress against sitting Congressman David Cicilline, and would also not seek reelection to her General Assembly seat.

Rep MacBeth was a straight shooter on Smith Hill (we need more like her). Thanks to her for trying to get to the bottom of why and how taxpayers came to be on the hook for $89 million in the 38 Studios debacle and especially for trying to get answers and accountability in the critical matter of the seven figure fees paid to the crony of former Speaker Gordon Fox, Michael Corso. (Your cue, Attorney General Kilmartin.)

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And We TRAIN Union Bosses on Top of Everything Else?

Quick preface: while some of us don’t hesitate to criticize the Providence Journal, I will say they get credit for running this Mark Patinkin column on the front page of the Sunday paper.

Right to organize. Contracts that often permit union business to be done on the taxpayer time. Just last week, a blatantly pro-union, anti-management, grossly erroneous decision by a state agency that will give striking (that’s STRIKING, RIDLT, not locked out) Verizon workers unemployment benefits.

Like this state isn’t already pro-union enough, with all of the corresponding damage that is done to our tax bills and the state’s business climate, our tax dollars are also going to train union bosses??? From Mark Patinkin’s column on the front page of yesterday’s ProJo.

For decades, taxpayers have been giving big bucks to an outfit whose main mission is training union leaders. This year, Rhode Island taxpayers are handing them $191,444. They’ve received more than $600,000 from us since 2012 — and more grants going back 35 years.

It’s called the Institute for Labor Studies and Research, and its grants have come from the state’s Office of Postsecondary Education.

I would echo Representative Patricia Morgan, quoted in the article; no value is given to the state by these ill-spent tax dollars.

By the way, the tax status of this non-profit probably should be reviewed as, by its own admission, it appears to be violating federal tax law.

They even offer classes on how to file a grievance, appeal a denied disability pension and lobby on union issues. That last one’s odd since nonprofits aren’t supposed to be political, but ILSR is so blatant that one of its courses teaches “collecting money for political campaigns.”

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A Political Business Network That Puts Businesses First?

Increasingly, over the years, I’ve become disenchanted with and cynical about groups that are supposedly active in politics to support businesses and the political philosophy that allows them to thrive without micromanagement from government officials.  A sampling of reasons:

  • When legislators placed a representative of the Greater Providence Chamber of Commerce on a commission to study the reduction or elimination of the sales tax, his most notable contribution was the opinion that it would be “a crime to threaten” a government revenue stream.
  • When the RI Center for Freedom & Prosperity proposed ways to reduce state spending by nearly a quarter-billion dollars (perhaps to invest in a sales tax cut or some other pro-growth policy), the RI Hospitality Association went to bat for big spending, mostly to maintain the annual six-figure sums the association receives from the state.
  • When it comes to the state government spending over $100 million to get a government-run health insurance broker off the ground, the Cranston Chamber of Commerce joined with socialists in looking forward to the ability of government agents to take over health care completely (which is becoming more obviously the motivation as ObamaCare and the insurance exchange prove to be costly and under-performing debacles).

As I’ve summed it up multiple times, Rhode Island’s public square doesn’t have groups that advocate for constituencies — in this case, business groups that pressure government for the benefit of members — but a network of insiders who represent the government to their members.  The “business voices,” and even most of our elected representatives, depend mostly on their government connections and unerringly put those connections before the well-being of the people they’re supposed to be representing.

Hopefully, cynicism can be healed with a group, like the Gaspee Business Network, that does exactly what we used to assume the chambers and other groups were doing.

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Arrest of Providence Council Majority Leader

Oh, boy. Another one.

Providence City Council Majority Leader Kevin Jackson was arrested by state police Wednesday for allegedly embezzling more than $127,000 from a taxpayer-subsidized nonprofit he founded as well as misusing $12,000 in campaign contributions.

Note that he (allegedly) personally benefited from his public office in not one but two ways: via his campaign account and also from a taxpayer-funded non-profit that he controlled.

To focus just on the former for a moment, how many other elected officials are tapping into their campaign accounts to cover personal expenses? First Gordon Fox; now (allegedly) Kevin Jackson. How does anyone continue to make the case, with a straight face, that campaign finance accounts should not be made public, the way Massachusetts and other states do?

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Tolls Having a Toll On Voter’s Opinion of State’s Future?

Interesting results from a poll commissioned by Bryant University’s Hassenfeld Institute for Public Leadership and carried out by Fleming & Associates. Rhode Islander’s view of the state’s future is trending downward.

A new survey of 403 registered Rhode Island voters shows only 31% think the state is heading in the right direction, while 50% now say it’s headed in the wrong direction. Less than a year ago, in September, it was a different story – voters were evenly split, with only 40% saying the state was moving in the wrong direction.

It is notable that this trend started in September when the state’s economy (purportedly) was improving. Could this public pessimism be a result of General Assembly leadership jamming through Governor Raimondo’s highly destructive toll plan last session? Pollster Joe Fleming lists that as one of the potential causes.

Fleming suggested voters are less concerned with the economy as it’s improved but have been alarmed by controversies at the State House such as the debate over truck tolls, the tourism campaign debacle, and the resignation of former House Finance Committee Chairman Ray Gallison amid a law enforcement probe.

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Gencarella – Small Steps on Smith Hill Don’t Match Mood of Disgruntled Residents

Excellent, detailed op-ed by Pam Gencarella in yesterday’s GoLocalProv which, at one point, echoes my thoughts. We are grateful that leadership at the State House is entertaining an ethics bill. But it is only one item on a long list of reforms that need to come to state government.

So while ethics reform and an audit of legislative grants may be the first steps in addressing the crisis in confidence that all Rhode Islanders are feeling, much, much more must be done before taxpayers will have any faith in this government. The Speaker, the Senate President and the Governor have a long row to hoe in attempts to win the hearts and minds of its citizens. The problem for them is there’s only about a month and a half left in which to make a dent in our battered psyche. The fortunate thing for us is that November is not that far off.

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Pass the Line Item Veto Now for Future Governors

Great job by everyone who turned out for yesterday’s very well attended hearing on the line item veto. Nice work by Ken Block raising public awareness of this good government measure that definitely needs to come to Rhode Island.

While the current Governor has said there was no line item in the most recent budget that she would have vetoed, this should be a tool in the belt of future governors, who might have higher standards, both for him/herself and for the legislature, than Governor Raimondo about all of the spending that goes into the state budget.

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Hiring of Director of Food Strategy is Governor Raimondo’s Econ Development “Let Them Eat Cake” Moment

Yesterday, Governor Gina Raimondo announced her pick to fill her newly-created position of Rhode Island’s “Director of Food Strategy”.

The state’s economy is in serious need of substantive improvement measures. (Pre-emptive note: taxpayer subsidies aren’t the answer.) There are good government measures that could benefit from her bully pulpit. But what is Governor Raimondo doing instead?

She is taking her time and state resources to create a state “Director of Food Strategy”.

Unbelievable.

There is a meme on Twitter and elsewhere that refers to the Governor as a queen. I don’t agree with it and have not retweeted it, in part, because I’m not a fan of name-calling but mainly because I simply haven’t seen her as a queen. Nor do I now.

What is clear with the creation and filling of this new state position, however, is that, like Marie Antoinette, Governor Raimondo is stunningly out of touch with the needs of the state and people whom she leads.

In an op-ed in yesterday’s GoLocalProv calling out the Governor on misguided priorities, Representative Patricia Morgan raised a good point.

In my life, I have found that the things people care about most are the things on which they spend the most time and energy. We thought the Governor cared about Rhode Island. Instead it feels like a bait and switch.

The creation of a “Director of Food Strategy” (job description here) is the latest – and most outrageous – instance of the Governor spending her time and energy on matters very much OTHER than the best interest of the state and its residents.

Rhode Island needs the Governor to adjust her focus. If simply doing the right thing isn’t sufficient motive, then how about for the more pragmatic one of improving job approval numbers?

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Letter: Don’t Add Superman Subsidies to the Taxpayers’ Tab

Well said by Catherine Orloff in a letter to yesterday’s Providence Journal. She uses the word that occurred to me: bailout.

Sure, a rehabbed “Superman” building would be great. But whose job is it: the owner’s or the public’s? …

No way should all Rhode Islanders be forced into yet another bailout.

Indeed, the public – a.k.a., the taxpayers – already has far too many costly problems on its hands, the vast majority inflicted on us by bad decisions and poor policies on the part of our elected officials. We don’t need to add yet another in the form of a bailout for the out-of-state owner of the Superman Building.

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Consolidation Must Be Done With Good Data & Open Eyes

While a proposal to consolidate dispatcher services on the city and town level would seem at first blush to be a good idea,

Mayors from six cities were joined by Lieutenant Gov. Dan McKee and several public safety officials at the State House Monday to call on cities and towns to bring dispatch services into the 21st century.

a statement by the author of this bill, Senator Louis DiPalma, is concerning.

“We believe this will save tax dollars,” DiPalma said in part.

“We believe” consolidation here will save money? Shouldn’t someone have done a little analyzing and come up with some figures before proceeding along this track?

As I said, it may well be a good idea. But the concerns voiced by some, articulated especially well by Justin Katz here and elsewhere, about consolidation and regionalization must be born well in mind. They will certainly not be assuaged if some of our officials embark on the voyage (… in an election year – not that I’m implying anything) without any numbers to back their proposal.

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One-Trick Pony Commerce Corp Continues To Hand Out Tax Dollars in Lieu of Real Reform

The Providence Journal today has not one but two articles about more money handed out last night by the state E.D.C. … er, Commerce Corporation: $1.9 million in tax credits to A.T. Cross, purportedly to prevent them from leaving the state, and $750,000 in grants to seven (it looks like) entities – some of them for pretty quizzical uses, by the way.

What Rhode Island needs to bring businesses and jobs here is real reform to its business climate by easing up the regulatory and tax burden on businesses. But neither the Commerce Corporation nor its boss, Governor Gina Raimondo, are undertaking this critical work. They choose instead to pretend they are accomplishing economic development by handing out hard earned tax dollars.

No one who pays even a little attention is fooled. The Governor’s robotic mantra of “I’m focused on creating jobs jobs jobs” is completely hollow until she and her agency take concrete actions to back it up.

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New Oversight Chair Dropping Investigation of 38 Studios; AG Says End is in Sight

Monday’s must-read, the Political Scene, in the Providence Journal includes the news that

Rep. Patricia Serpa, the newly appointed chair-woman of the House Oversight Committee, says the days of the panel digging into the lingering mysteries of the 38 Studios debacle are over.

“I am going to pivot. I don’t want to regurgitate any more information about 38 Studios or election lines and voting lines,” …

It is disturbing and bad for Rhode Island that Chairwoman Serpa, presumably at the request of Speaker Mattiello, doesn’t want to expose the events and money trail that put state taxpayers on the hook for $89 million (minus some modest settlements in the civil cases).

In related news, Attorney General Peter Kilmartin tells GoLocalProv that

… the end of the 38 Studios investigation is in sight.

“I believe the state police are close to a wrap up,” said Kilmartin, though he said he couldn’t provide a specific time frame. “And we will see how that investigation ends up.”

The $89 million question there is, did the Attorney General allow a comprehensive investigation of all important aspects of the 38 Studios, including where all of the money, especially the fees paid to Gordon Fox’s crony Michael Corso, ended up? Or did he keep the focus on a side issue or two to avoid getting the full picture of what led up to this debacle, a comprehensive look that might cause embarrassment to and even criminal charges against friends currently or formerly in power?

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“YouGottaBeKiddingMe” about Former Chief Marketing Officer’s Severance Pay

Thanks to the Providence Journal’s Ed Fitzpatrick for making the severance pay of Governor Raimondo’s former Chief Marketing Officer the subject of his “YouGottaBeKiddingMe” today.

… Betsy Wall, who stepped down amid the state’s “Cooler & Warmer” slogan fiasco and who didn’t know Gaspee Days from “Happy Days,” is going to get $67,500 in hard-earned taxpayer dollars as severance after a little more than three months on the job? You’re telling me that an “at-will” employee with no contract will receive that much money on top of the $39,173 she was paid through April Fool’s Day?

Nice! At Governor Raimondo’s direction, Betsy Wall will receive more in severance pay than she earned while she was employed by the state.

Note that rather than a blanket omerta, Wall’s termination agreement includes the cleverly phrased stipulation that all parties will refrain from making any “disparaging comments”. As much of the tourism campaign was a “hot mess”, to use one of Fitzpatrick’s terms, and clearly worthy of many disparaging remarks on all sides, this will prevent any uncomfortable truths – i.e., accountability – from coming out about the failed, $5 million campaign – at least from Wall or Raimondo’s staff. Fitzpatrick correctly alludes to the fact that the rest of us are not party to the agreement, however, and are certainly free to make disparaging remarks – as we have done and will continue to do about this and many other instances of tax dollars squandered by the Raimondo administration.

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Smith Hill Leaders Backtracking on Even Partial Toll Relief for Truckers

Well, well, what a shock. Governor Raimondo and Speaker Mattiello are backing away from even partial relief for in-state trucks from the onerous burden of tolls.

“I don’t know if there will be assistance for truckers per se, but certainly in the process of doing [truck tolls] we heard from a lot of truckers,” Governor Raimondo said Tuesday in a lunch briefing with reporters. “They have unbelievable turnover in the industry. It is expensive to train people. We are listening to people and if there is something we can do we are open to it.”

Pressed about whether direct financial assistance is still the focus of efforts to help the industry, Raimondo said, “I am not sure.”

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RI Government Has Created Way Too Many Programs to Shovel Tax Dollars Out the Door

Thanks to a Rhode Island press corps that has been doing kick-butt investigatory work, developments are coming fast and furious in the “non-profit” entity aspect of the multi-tentacled Ray Gallison scandal.

To focus on just one new development, there were not one but two non-profit organizations affiliated with now-resigned Representative Ray Gallison that were receiving tax dollars. The new organization called “Man Up”, brought to light by WPRI’s Ted Nesi and Tim White, received tax dollars from what appears to be two sources within the Governor’s office: a grant from the new Real Jobs Rhode Island program and a grant from the Governor’s Workforce Board of Rhode Island. Following inquiries from Target 12’s Nesi and White, the Governor’s office announced yesterday it had frozen the Real Jobs grant. And the Providence Journal reports this morning that the Governor’s office had suspended the balance of both grants and would be auditing payments received by the two organizations affiliated with Gallison. (Important side note: is handing out tax dollars for this sort of baloney what constitutes the frequently referenced “education and training” part of Governor Raimondo’s economic development initiative?)

These are, of course, in addition to the $1.7 million in community service grants that Gallison’s other non-profit had received courtesy the General Assembly leadership … of which he was a member (*clutches head*).

All of this is still very much unfolding. And the public has yet to hear about the status of the criminal inquiry into other areas of former Rep Gallison’s activities. Two things, minimally, are already crystal clear:

1.) There are way too many state programs in existence whose sole purpose is to hand out tax dollars.

2.) The state is handing out way too much of the taxpayers’ money. This is all the more egregious because there appears to be little to no oversight or accountability that accompanies this public money.

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Patronage Clerkship Hire Contributes to Smith Hill’s Poor Reputation

The Providence Journal reported yesterday that

Former state Sen. Rhoda Perry will return to the State House this week, for a hearing — by her former colleagues — on her qualifications for her new “$69,243 to $78,493” job as the Superior Court clerk for Washington County.

From a browse around Google, it appears that court clerkships are normally filled by law school grads or attorneys. (Please correct if this is wrong.)

But Rhoda Perry is neither. Rather, she is a former senator and one who was reportedly close to the Senate President. Accordingly, rather than a hiring on the basis of qualification and experience, this looks like the distribution of political booty to a loyal legislative soldier.

While not corruption in the criminal sense, such a hire is corruption in the larger sense as it is made on the basis of patronage ties rather than what is best for the state and the court system. It is only the latest in a long line of actions (add tolls and legislative grants to this list) that significantly damages the image of Smith Hill as a place where they shoot straight and play clean.