Entries by Monique Chartier

Bike Paths, Lights, Sustainability – RhodeWorks Tolls Turn into Huge Bait-And-Switch

/by

Am I going crazy? (Don’t answer that!) Didn’t Governor Gina Raimondo sell us on her unnecessary and highly destructive RhodeWorks toll plan by saying that the money would go to repair our very unsafe (oh so unsafe; most unsafe in this quadrant of the galaxy) bridges? But look at this RhodeWorks Quarterly Report!

Bike paths, lights, guardrails, road re-paving, something called “I-95 Sustainability” – RhodeWorks is being spent on all kinds of projects, not just bridge repair. Remarkably, there is even a RIDOT sign that CONFIRMS money from the RhodeWorks/Toll Project is being spent on a bike path!

What the heck??? Tolls were supposed to go to our unsafe bridges! Where did all of these other projects come from?

​How Does the Governor Reconcile Her Support for Lower Electric Costs with Her Push for Renewable Energy?

/by

All eyes on Philadelpha and the Democrat convention, of course. Thanks to Wikileaks, by the way, for furnishing an interesting Rhode Island connection for us all to speculate on.

Meanwhile, it’s important not to totally lose sight of stuff going on back in Rhode Island. The debate about a natural-gas powered electric plant proposed for Burrillville, for example, moved into the arena of the PUC this week.

The hearings are set to run Monday, Tuesday and Wednesday and will differ markedly from the public hearings that have been held so far on the application, which gave Burrillville residents and others the opportunity to air their opinions and concerns about the power plant but didn’t allow for any back and forth.

On Thursday, Governor Raimondo called into the WHJJ Morning News with Ron St. Pierre to defend her support of the plant. (Podcast.) In doing so, she said

Well, I support natural gas because I support lower energy costs and lower electricity costs for Rhode Island.

That’s a pretty categorical statement. Yet only seven months ago, the Governor signed an Executive Order

… committing state agencies to get 100 percent of its power from renewable sources by 2025

Further, in February,

A bipartisan group of 17 governors, including Governor Raimondo, have signed a pact agreeing to work together to build modern, sophisticated transmission grids and to advance clean energy and transportation technologies. Called the Governors Accord for New Energy, the agreement includes commitments to diversify energy generation and expand clean energy sources …

All of these actions by Governor Raimondo are a big problem for everyone’s electric bill and a huge conflict with what she said on WHJJ. Because the dirty little not-so-secret about renewable energy is that it is far more expensive than conventional energy. Further and worse, as an important new report by the Rhode Island Center for Freedom and Prosperity demonstrates, the state’s continued pursuit of renewable energy would come at a high cost to ratepayers and taxpayers while providing an extremely poor return on greenhouse gases abated BY THE EPA’S OWN STANDARDS. In fact, the cost of renewable energy to Rhode Islanders could be as much as five times higher than the EPA recommends.

The Governor seems to want to manage her stance on energy in silos. “I’ll support the gas powered energy plant and say that I support lower electric rates and that will cover me with a lot of Rhode Islanders. Meanwhile, I’ll aggressively push renewable energy mandates onto ratepayers and taxpayers and that will satisfy the environmentalists.”

But it does not work that way, on any level. Firstly, the walls of the silos are not opaque. So everyone, whether inside a silo or outside of it, can see what she is doing in all of them. Far more importantly, the effect of her actions in one silo do not remain contained therein: what she does in one – the renewable energy silo, in this case – will most definitely have the effect – higher electric rates – that she claims to deplore as she’s standing in another.

Her words, to phrase it more plainly, do not match her actions. And that’s a real problem for the ratepayers (let’s remember, this category includes businesses) of a state that has some of the highest electric rates in the country. They very much need her actions – a wholesale repeal, not an expansion, of very expensive renewable energy mandates – to match her words when they open their electric bills every month.

Speaker’s “Independent” Political Opponent Know Buttons But Not Policy

/by

Fascinating interview in yesterday’s Providence Journal by ace political reporter Kathy Gregg. She sits down with the “independent” candidate who has entered the race for House District 15, currently held by one Nicholas Mattiello, Speaker of the Rhode Island House of Representatives.

During the interview, Patrick Vallier indicates, apparently without hesitation, that he opposes tolls and the legalization of marijuana and is a supporter of the Second Amendment. But the gentleman didn’t have an answer for a very basic question:

Asked the top three things he would like to do for his home city, Vallier laughed and then said, “Ooh. That’s a tough one.” After a pause, he said: “Probably taxes. Do something with taxes. … The car tax. A lot of people complain about that.” Next? “The minimum wage maybe go up again. I’ll try something with that.” Third top issue? “I guess that’s it right now. That’s all I can say.”

How interesting and strange! It’s almost like someone whispered the hot button issues to the gentleman while assuming, mistakenly as it turns out, that he was familiar with substantive policy matters.

But the interview reaches the peak of strangeness with this.

Asked if there is anything Mattiello has done that he would have done differently, Vallier said: “Not really. …

Wow, really? Then, respectfully, sir, why are you running if the guy currently holding the office is doing a fine job from your perspective? Especially when that incumbent has a ton of resources, financial and other, to fight off your challenge.

I am not in the least implying that this may be what is going on with this gentleman’s candidacy. But here’s a sincere tip for a person who has entered a race as a straw candidate: if any professional Rhode Island journalist approaches you looking for an interview, you should run for the hills. If that reporter is Kathy Gregg, you should don a jet pack to expedite your escape.

Newest Addition to State’s … Er, News Scene: “The Rhode Island Cooler and Warmer”

/by

Rhode Island has a new … um, newspaper (in the loosest sense of the word): “The Rhode Island Cooler and Warmer”. From the publication’s “About” section on their Facebook page.

The Rhode Island Cooler and Warmer is a satirical news publication. Don’t take yourself too seriously, and enjoy.

Not only does the publication exist only on Facebook and Twitter, but some of its articles are not even complete, ending at what appears to be the middle of the article with a seeming traditional newspaper pointer “Cont’d on Page 4” … but no Page 4 (or whatever) to turn or click to.

This is the only slightly discombobulating aspect of an otherwise well-informed, fun and definitely welcome addition to Rhode Island’s … um, newspaper scene. To give you a flavor of the newspaper, the headline of one of my favorite “articles” (screenshot only, so no way to copy and paste an excerpt here) is “Governor Gina Raimondo Briefly Visits Rhode Island”.

In its second issue, Cooler Warmer “covers” a news item inexplicably missed by WPRI’s indefatigable Providence news hound Dan McGowan.

City of Providence files legal claim as common law wife of former Mayor Vincent Cianci: City seeks millions from Buddy’s estate

and also gets the dirt on the real method utilized by Brown University to conduct a poll.

Check it all out, including their latest issue released just in time for Independence Day, here.

It’s Pull-Papers Time!

/by

If you’re planning to run for office in Rhode Island, it’s time to file a Declaration of Candidacy form. Deadline to file is tomorrow (Wednesday, June 29, 2016) by 4:00 pm. If you’re running for local or state office, you would file them with your local Board of Canvassers. (The Board of Canvassers is often a part of your City or Town Clerk’s office and, if not, they can certainly direct you.) If you’re running for federal office, file with the Rhode Island Secretary of State’s office. (… I presume that’s what “Department of State” means on this form; seems like poor wording by the RI Secretary of State’s office.) FYI, next step will be to collect signatures on the nomination papers that you will, in due course, need to obtain.

A couple of current event items to note. The Tee-Shirt guy had vowed to run again but as of the end of the day yesterday, he had not pulled papers. (Possibly an investigation by the Rhode Island State Police has impacted either his schedule or his plans.)

And, if you were mulling a run for the General Assembly, perhaps this will tip you over: WPRI’s Ted Nesi has crunched the numbers and determined that Governor Raimondo, with the highly misguided approval of the General Assembly, has handed out $50 million ($50,000,000) AND COUNTING in corporate welfare under the guise of economic development. As a legislator, you would have the ability to vote against such costly, inequitable madness.

Great Britain Says No to Centralized Government

/by

Nice – defying the latest poll results, Great Britain has voted to leave the European Union.

The UK has voted to leave the European Union in a historic referendum which threw Westminster politics into disarray and sent the pound tumbling on the world markets.

Ukip leader Nigel Farage declared that June 23 should “go down in history as our independence day”, while Vote Leave’s chair, the Labour MP Gisela Stuart, said it was “our opportunity to take back control of a whole area of democratic decisions”.

Excerpt below from the Rhode Island Center for Freedom and Prosperity’s statement on the implications of the Brexit vote. Read their full statement here.

Symbolic of its fight against regional governance and federal intrusion into state and local affairs, the RI Center for Freedom & Prosperity today applauds the British people for voting to re-establish their national sovereignty and to depart the European Union.

Rhode Island’s Big Kahuna Acquires an Opponent

/by

Big news yesterday as Steve Frias (R-Cranston) announces that he will run against House Speaker Nicholas Mattiello (D-Cranston) to represent House District 15.

Republican Steven Frias hopes to ride a wave of dissatisfaction with Rhode Island’s status quo to unseat House Speaker Nicholas Mattiello, often referred to the most powerful elected official in the state.

Interestingly, GoLocalProv refers to Frias, who resides in Cranston, as a “Boston Lawyer”, the only news outlet to do so.

Sustainable? Some of RI’s Corporate Welfare is Funded by Moral Obligation Bonds!

/by

Brian Bishop points out in today’s GoLocalProv that certain corporate welfare handed out by the state is funded not pay-as-you-go, out of the budget, but by moral obligation bonds.

Even if you think historic tax breaks are a necessary evil, we didn’t budget for the cost of these breaks, we used moral obligation bonds through the Commerce Corporation to pay for them, a harbinger of the tax [breaks] and spend ‘fireworks’ economy. The flash and bang from each growth purchase fades quickly, requiring us to head back to the fireworks factory and buy more and more, when we haven’t even paid for the fireworks that have already gone off and faded.

The corporate welfare in the form of crony-targeted tax breaks that Governor Raimondo, with the approval of the General Assembly, hands out are bad enough. But the state also hands out corporate welfare for which taxpayers must pay interest! (Remember, this was also the funding method of the 38 Studios debacle.)

The cool new thing with progressive politicians is “sustainable”, as in “sustainable development” and “sustainable energy”. But how can (re)development funded at someone else’s (taxpayers) expense via high-interest moral obligation bonds be cast as “sustainable”?

In fact, what state and local taxpayers really need first and foremost is sustainable budgeting! And further to that, we need elected officials in the Rhode Island Executive and Legislative branches who recognize these (corporate welfare and, even worse, corporate welfare charged to someone else’s high interest credit card) for the unsustainable policies that they are and put an end to them.

ProJo Editorial Correctly Highlights Bad Jobs Report

/by

Spot on editorial by the Providence Journal yesterday about last week’s bad jobs and employment report.

Two points in particular to highlight.

1.) Their call for broad-based improvement to the state’s business climate.

Beyond targeted incentives, Rhode Island needs a better tax and regulatory climate that encourages companies that are here to grow and others to come.

Thank you thank you thank you.

2. And this.

Perhaps what is most alarming about last week’s jobs report is that it’s never really felt as though Rhode Island was out of the woods.

Indeed, a well-founded feeling confirmed by the Rhode Island Center for Freedom and Prosperity’s Jobs and Opportunity Index (JOI): our state has been stuck at forty eight since 2012. This is a situation that will only change when state officials take to heart the call by the ProJo and many others to take a much broader approach to economic development than the handing out of welfare to a very narrow list of corporate cronies and occasional, isolated tax reductions that lack credibility as they are unaccompanied by a reduction in overall spending.

Please Check Out the Gaspee Business Network Thursday!

/by

On Thursday (June 23, 2016) at 5:30 pm, the Gaspee Business Network will be holding a Partner Information event at the Radisson Hotel, 2081 Post Road, Warwick. If you’re a business owner and you’re not satisfied with the state’s business climate, please consider dropping by to check out the “Incorruptible Voice of Rhode Island Business“.

We will be discussing why the GBN is different from other business networking groups and how you can take part in the most formidable force to fight the hostile business environment so prevalent throughout Rhode Island.

For more information about the GBN, click here. Click here to register for the event. Or just show up!

Tee-Shirt May Shield Well From Allergens … But Not From a Board of Canvassers Inquiry

/by

In light of the serious questions about the rep’s domicile raised by this Target 12 investigation, the Providence Board of Canvassers yesterday voted

… to take up a case challenging whether state Rep. John Carnevale lives in his legislative district, determining there is “reasonable cause” to suspect he is ineligible to vote there.

It is impossible not to speculate what defense the rep will bring, what steps he may take to defend his assertion that he lives at the Providence address. Is he, for instance, briskly arranging even now for one of the tenants at the two family house to move out so that he can occupy that apartment? (Stipulating for a moment the premise – innocent until proven guilty even in a civil proceeding – that he doesn’t currently live there …)

Definitely No Taxpayer “Bridge Financing” – Or Any Other Tax Dollar Involvement – for Superman Building

/by

An editorial in yesterday’s ProJo mentions an interesting and disturbing prospect that I at least had not yet heard about: taxpayer funded “bridge financing” for the Superman Building. (Tolls on “bridges”; now the possibility of “bridge” financing for an empty building. How did bridges suddenly become a new peril for state taxpayers and residents?)

The editorial also identifies the $64 million question that needs to be answered.

It is not the taxpayers’ business to make High Rock whole on a bad investment. But there is public interest in seeing activity there rather than vacancy and slow deterioration. For example, turning the Superman into a classy downtown apartment building with magnificent views of the city and the water would breathe economic life into the downtown, since new residents would dine out, shop and pay taxes.

The question is: How much is this activity worth to the taxpayers?

The latest estimates to rehab the Superman Building are in the $60-100 million range, though this GoLocalProv story from three years ago mentions the even more insane figures of $140 to $145 million.

To answer the ProJo’s question – “How much is this activity worth to the taxpayers?” – there simply is no amount of secondary/related economic activity that could come close to justifying any taxpayer involvement in such an exorbitantly expensive real estate rehabilitation project. Any official who proposes to do so must satisfactorily answer every entirely valid question posed by the Rhode Island Center for Freedom and Prosperity three years ago.

Elected officials would be wise to instead address the conditions that have contributed to the dearth of business tenants that financially imperil this building, and almost certainly others: the state’s business-repulsive tax and regulatory climate. Taxpayers cannot possibly “bridge” the financial chasms, either at 111 Westminster Street in Providence or everywhere else around the state, created by state officials’ continued refusal to do so.

Why Does RI Hand Out Insanely Long Probation Sentences?

/by

Eight years probation (plus four months in jail) for stealing a bus pass???

Nearly a decade ago, Providence resident Edward Coulter was sentenced to 4 months prison and 8 years probation for stealing a bus pass.

As of 2015, Rhode Island has the third highest probation rate.

Why? Is it a way to grab money from the defendant? While troubling in concept, this doesn’t seem like a reasonable explanation: the probation fee in RI is $20/month (as of a 2004 document). Not only can the defendant apply to have it waived for “unreasonable financial hardship” but, even if it were collected from all probation defendants, it doesn’t seem like it would add up to nearly enough money to fund the costs of the probation program itself.

Is it make-work to increase government jobs? This seems more likely, especially as, with such long probation sentences, it increases the likelihood of a probation violation, which results in the defendant going to jail

Since then, there have been additional violations, which have doubled his probation sentence.

and you get the “bonus” of more prison FTE’s

… nearly one-third of people locked up in the ACI are behind bars because of a probation violation.

on top of the extra FTE’s needed to administer absurdly long probation sentences.

Whatever the answer, the current probation system is obscene and injust and badly in need of reform. By the way, shame on all state officials, including specifically legislators, who have known about this for years but did not act to reform it … and have failed once again this year to implement reform. (For the record, Senate President Teresa Paiva Weed is NOT in this category; the last-minute scrapping by House leadership of a suite of reform bills appears to be why she got upset during the General Assembly’s long final day Friday into Saturday.)

GE(e), Rhode Island is Losing Jobs

/by

With the latest numbers, Rhode Island’s jobs and opportunity picture has worsened.

Rhode Island lost 3,900 jobs over the last two months — 1,900 in April and 2,000 more in May — a clear signal that the economy is slowing, according to data released Thursday by the Rhode Island Department of Labor and Training.

Other numbers, like the size of the state’s labor force, are also going in the wrong direction, which unfortunately, corresponds to the state’s ranking on JOI, the RI Center for Freedom and Prosperity’s new, broader spectrum reflection of the state’s employment situation. (Be sure to check back on Monday, when the Center will be updating the Jobs and Opportunity Index.)

State officials are quick to point to a national turn down as a contributory factor to the state’s worsening employment numbers. But that only highlights the need for Rhode Island officials to strengthen the business climate here so that we are not so susceptible to undesirable national trends.

On that front, a note to Governor Raimondo and General Assembly leadership: targeted tax breaks and subsidies do NOTHING to improve the state’s business climate as a whole. (Evidence: the one hundred jobs that General Electric will be bringing here, while welcome, have been engulfed by the 2,000 jobs that the state lost in May.) Corporate welfare only adds to the burden of the average guy and other businesses in the state.

Ethics (Authority) Poised to Return to General Assembly

/by

The Providence Journal reports on one of the few bright spots out of this General Assembly session: the passage of a resolution that would, as Common Cause Rhode Island phrased it in an e-mail last night with the subject line “Victory!”,

… put a question on the November ballot to allow you, the citizens of Rhode Island, to restore the full jurisdiction of the Ethics Commission over legislators.

So the ProvPort Non-Profit Operating Company is Just a Front?

/by

One of the poorly (deliberately?) advertised additions to the 2017 budget last night was a $20 million bond proposal which would fund the acquisition by the Port of Providence of certain properties on Allens Avenue. RI Center for Freedom and Prosperity CEO Mike Stenhouse accurately calls the bonds more corporate welfare.

GoLocalProv’s Kate Nagle has an excellent investigative report showing that

ProvPort, the non-profit operator of the Port of Providence seeking a $20 million taxpayer bond, paid management fees to a sister for-profit company of more than $11 million over the three most recently reported years. The $11 million is approximately half on ProvPort’s total revenue. …

The relationship between the non-profit and for-profit raises concerns. The non-profit takes in the money, only has one employee, and transfers millions every year over to a for-profit company.

Probably this arrangement is legal, though it certainly seems like a convenient set up to avoid corporate taxes.

So the proposition by Smith Hill leaders is that we should pay our hard-earned tax dollars to help fund real estate acquisitions for a company that is attempting to DODGE taxes? And, no, it doesn’t mitigate the situation that the state would own the new parcels. The parcels would still benefit ProPort, not to mention the larger point that state government should get smaller, not larger.

Look, I don’t want to have to look at or care about the corporate structure or tax arrangements of a company. But you’re forcing me to by proposing to reach into my wallet on their behalf. Out of all of the bond referenda on the ballot this November, this should be the easiest and fastest “No” of the bunch.

EPA (Via Its Standards) Says Renewable Energy Offers RI Very Poor Cost-Benefit Return

/by

It is well but perhaps not as widely known as would be desirable for a fully informed discussion on the subject that renewable energy is far more expensive than conventional (fossil fuel) energy sources. Further to this point, the RI Center for Freedom and Prosperity has released a report with the helpfully descriptive title: “Renewable Energy in Rhode Island: Big Cost, Little Difference”. (Link to the full report in PDF here.)

The report points out that by the EPA’s own standards, the cost of Rhode Island abating carbon from its energy supply would far exceed the benefits that would accrue to the state.

Because of this poor cost-benefit “value proposition,” up to five times less than the Environmental Protection Agency (EPA)–suggested standard, Rhode Island should reconsider its existing energy policy approach.

Let’s repeat this very important point and its source. By the measure of the EPA, not exactly a research arm of the vast right-wing conspiracy, it simply is not worth it, in terms of the carbon that would be abated, for Rhode Island to put renewable energy on its grid.

With this information, elected officials – Governor Raimondo and members of the General Assembly – can no longer in good conscience advocate or vote for renewable energy in Rhode Island. In fact, just the opposite, as the Center calls for: renewable energy mandates must be rolled back.

Based on this study’s findings, the Center strongly recommends that lawmakers reject all proposed new energy mandates in 2016 and, instead, repeal those that are currently written into law.

Another Welcome Fire-and-Brimstone ProJo Editorial

/by

… yup, the hits keep coming. All of this makes a very good case for candidates this November who have 1.) not participated in this “rot” and 2.) has not voted for the status quo (tolls and the 2017 budget, to name two of the biggest items).

Dubious grants that benefited Mr. Gallison (who is under federal investigation) brought into question the whole system of handouts by legislative leaders without proper vetting or any attempt to weigh the state’s overall interests. …

A poll shows three-quarters of Rhode Island voters support the line item veto, as does the governor. Forty-four other states benefit from it. But legislative leaders in this state still stubbornly refuse to put it on the ballot. …

This week, we learned that Rep. John Carnevale, a former police officer who has a tax-free disability pension and is vice chairman of the House Finance Committee, is evidently living outside of his district. When he discovered WPRI-12 cameras filming him, the station reported, “he walked out of sight and returned with his face wrapped in a T-shirt, seemingly to avoid being seen on tape” — a literal cover-up.

Accounting Issues Persist for John Hope … and, Far Worse, for Government

/by

The impression about financial irregularities at the John Hope Settlement House has been that all of that took place years ago. Well, yes, it did. But now the problem seems to be that the organization cannot demonstrate to HUD’s satisfaction that it has taken sufficient corrective action to prevent a repeat.

[Providence Director of Community Development Brian] Hull said the Department of Community Development was troubled that audits of John Hope’s books showed shortcomings in 15 areas, such as monitoring payroll, tracking cash receipts and payables, loans to employees without a loan policy in place, late debt payments and a lack of documentation in numerous other areas. The city sought guidance from HUD’s New England area office and the agency, which finances the CDBG program, told the city not to give John Hope the grants “at this time.”

“We note that the entity responded to many of the auditor’s concerns but no evidence was provided to support whether the discussed corrective actions were verified or whether the corrective action taken resolved the deficiencies,” New England HUD Director Robert Shumeyko wrote.

In light of that, it was prudent for the city of Providence (at the recommendation of HUD) and the state to pull back on grants to the organization, though apparently the organization can re-apply if it can show it has come in compliance with HUD’s accounting requirements.

The bigger issue here is that, whether it is social programs or corporate welfare or community grants, government has an obligation to keep tabs on the tax dollars it hands out and make sure that they are not abused. (We are stipulating for a moment the worthiness of the expenditure. The John Hope Settlement House is, for example; corporate welfare is not.) While the Gallison scandal has compelled the state and the city of Providence to start checking into grants as with the John Hope Settlement House and others, little is done to prevent waste and abuse in other programs – the aforementioned social programs, for example – where far larger amounts go out the door. It’s simple. If our elected officials lack the resources or inclination to properly oversee the tax dollars they hand out, they need to stop doing so.

Speaker & OHIC: Stopping Some of the State Taxpayer’s Bleeding

/by

As with his pulling of Budget Article 18, another reason to praise Speaker Mattiello this week: he is not seeing why state taxpayers should be forced to step into the breach left by the drying up of federal funds.

The office responsible for protecting consumers from excessive health insurance rate increases stands to lose nearly its entire staff if the House on Wednesday approves a budget amendment passed by the House Finance Committee. The $1.03-million loss in funding for 9 of its 12 full-time staff would leave the Office of the Health Insurance Commissioner (OHIC) with only three employees …

Governor Raimondo’s budget included $1.03 million to replace federal grant funding for the nine staffers when the grant runs out on Sept. 30, but the House Finance Committee last week voted not to replace the funding. “When the money runs out the programs are off,” House Speaker Nicholas A. Mattiello said during a budget briefing last week. “Every time a federal grant expires everybody wants the funding to continue. You have a government that Rhode Island cannot afford.”

If I understand correctly (let me know if I’m wrong here), these FTE’s are in ADDITION TO the staffing of Rhode Island’s (completely useless) ObamaCare exchange, HealthSource RI. Staffing levels of this department have fluctuated somewhat but have generally suffered as the tide of federal ObamaCare funds has receded (as scheduled).

There needs to be some thought before state officials agree to implement a federal program with funds that sunset. State taxpayers simply don’t have the capacity to take on the funding of ever more, new programs.

And if the sitting Governor (in this case, Governor Raimondo) feels that the program should continue with state taxpayers picking up the tab from the lapsed federal funding, he or she should make cuts elsewhere in the budget to find that revenue, not simply heap another burden on state taxpayers.

Alarming – Budget Article 17 Could Set Up Stream of 38 Studios-Style Failures

/by

Another problem article in the proposed House budget would, remarkably, put state taxpayers in positions of equity in certain, chosen companies. See the language below on page 9:

(b) Notwithstanding anything in this chapter to the contrary, the commerce corporation may make a loan or equity investment as an alternative incentive in lieu of the provision of tax credits so long as the applicant otherwise qualifies for tax credits under this chapter.

This is a bad idea and poses serious dangers to taxpayers if it passes, as Rep Patricia Morgan (R – Coventry, Warwick & West-Warwick) outlines in the following statement just issued.

Rep. Morgan Questions New Commerce Article Which Puts Taxpayers at Risk

STATE HOUSE — Representative Patricia Morgan (R-District 26 Coventry, Warwick, West Warwick) is calling attention to the new provisions in Article 17, which relate to commerce and economic development.

“The new language governing the Commerce Corporation’s program for economic development on the 195 land is troubling. The new law would fundamentally change the original intent of the program and lead the state into areas best left to financial experts. Financial money managers risk private money, the state risks taxpayer money,” stated Representative Morgan.

“Rhode Islanders have made it clear that they do not want tax dollars given to projects that should be left to the private marketplace. In the past, we have granted authority for the Commerce Corporation to issue tax credits which have the goal of growing tax revenue as the company thrives. However, the Commerce Corp. is now asking for the ability to make equity investments. This investment puts taxpayers in the position of being owners of the company.” explained Morgan.

“If the company thrives, the state not only receives the investment, but also a potential profit. However, if it fails, as in 38 Studios, state would lose the entirety of the taxpayer investment. Public money should never supplant private investment in the marketplace. It’s dangerous for taxpayers.”

Other provisions the Article17 also raise a red flag. “In existing statute the Commerce Corporation is authorized to give up to $15 million, capped at 30% of the total cost of the project, to a developer. The new Article allows a developer to split the project into two and accept $15 million for each portion for a total of $30 million. Additionally, the new language allows the Commerce secretary to waive the 30% cap once a year. That takes away taxpayer protections.”

“One major concern is a taxpayer funded subsidy for the Superman building project in Providence. In current law, economic development incentive programs for the 195 land reclamation project, include the Downtown Providence area with the Superman building. The budget article before the General Assembly increases the maximum aggregate tax credits for this program. The program has been increased to $150,000,000. With such a high program cap, the fear is that money will be diverted to fund redevelopment of the Superman building without taxpayer input.” explained Morgan.

“While these changes were presented to the Finance Committee, albeit well after midnight, they have not been thoroughly explained or vetted. The financial impact to Rhode Island must be thoroughly reviewed before any budgetary vote. I, as a House Representative, want to be fully confident this program will not lead taxpayers down another dead-end path of wasted taxpayer money.”

“Ultimately, our state’s leaders need to do more than find creative corporate subsidies. This welfare takes money away from hardworking Rhode Islanders and is funneled to companies of specific choosing. The State should not be in the venture capital business. Instead we need to do the hard work of reforming our economic climate; reducing property taxes, eliminating costly and non-value added regulations, changing a hostile legal system, restoring ethics, and reducing the cost of government instead of tacking on new taxes, fees and tolls each year.”

“Companies should come to Rhode Island because it’s a great place to grow, not because we pay them to come.”

Article 18: Another Insider “Deepwater” Scam in the Making? (Corrected)

/by

Despite disturbing new revelations and renewed public criticism about insider legislative grants, cronyism appears to be alive and well at the Rhode Island State House. And once again, Ocean State families and businesses would be asked to foot the bill.

In the budget that got voted out of the Finance Committee early Wednesday morning, alert observers spotted and brought to the attention of the RI Center for Freedom and Prosperity as well as the Ocean State Current on Friday an extensive revision to Article 18.

They are correct to loudly ring warning bells about it. If it stays in, state electric ratepayers are in for even higher electric rates than they currently pay.

At $55,650/Job, RI Cannot Afford the Governor’s Economic Development Approach

/by

In the “Absolutely!” segment of his column in today’s Providence Journal, Ed Fitzpatrick praises Governor Raimondo for bringing one hundred General Electric jobs to Rhode Island. His column continues,

Raimondo has talked about public criticism, saying, “At the end of the day, the governor is judged based upon results.” Well, these are the kinds of results she envisioned in creating an economic development “tool box.” GE will apply for $5 million in tax credits over 10 years and $565,000 in closing funds. While critics decry “corporate welfare,” Raimondo says other states use such incentives, and “you cannot fight with one hand behind your back.”

One hand tied behind your back is a good way to describe what it’s like to try to run a business in business-unfriendly Rhode Island. Yet, rather than improving the state’s business climate by reducing state spending so as to lower taxes, Governor Raimondo has actually been doing the opposite by ramping up a whole array of targeted tax subsidies that everyone else has to pay for.

Yes, we will, indeed, judge the Governor based upon results. But our measure will be much broader than the very occasional photo op success. We’ll be looking for a consensus among national rankings that the state is going in the right direction, for example. And we will definitely be keeping an eye on Rhode Island’s ranking on the RI Center for Freedom and Prosperity’s Jobs and Opportunity Index (JOI).

At anything like $55,650 per job, Rhode Island simply cannot afford the “tools” Governor Raimondo is using, either literally or in the cost of her continued inaction to improve the state’s business climate. She needs to begin looking outside of a “tool box” that, so far, resembles a corporate legislative grant program on heavy steroids.

Upcoming WPRI Investigative Report: ​The Failed Tee-Shirt ​Escape?

/by

The ​WPRI preview calls this the “strangest twist ​to a Target 12 investigation yet”. I’d call it the most intriguing: with WPRI investigative reporters hot on his heels, a state representative wraps a tee shirt around his head in an apparent attempt to slip away unnoticed.

Does this state rep have something to hide? Will this WPRI investigation uncover activity that fits too well with a ​pattern of political corruption in Rhode Island?

We’ll all have to tune in to WPRI channel 12 on Monday at 5:00 pm to find out!

Toll Relief (Shhhh! It’s Not That!) for In-State Truckers Falls Way Short

/by

It turns out that the General Assembly’s proposed 2017 budget will, after all, contain very partial relief from impending truck tolls in the form of lower registration fees for in-state trucks though, due to questions of constitutionality, the Speaker is asking that we not connect the two.

With the national trucking industry threatening to challenge the constitutionality of the truck tolls in court, after the first gantry goes up, House Speaker Nicholas Mattiello was insistent on Thursday that the registration-fee cuts in the newly unveiled budget bill have nothing to do with the tolls.

“I don’t want to connect the two,’’ House Speaker Nicholas Mattiello said Thursday.

Okayfine, they’re not connected. The reduction in registration fees for this NON-RELIEF from tolls will vary with truck size.

At the lowest end, the annual registration fee would drop from $106 to $78. For trucks weighing more than 74,000 lbs. — which are at the top end now — the fee would drop from $972 (plus $24 for every additional two pounds in weight) to $510. For even larger rigs, there would be a graduated fee schedule, topping off at $690 for tractor-trailer trucks weighing more than 104,000 pounds (plus $12 for every additional 2,000 lbs. of weight).

Soooo, on the upper end – $500-$600 savings per year? By the way, this means that some of the heaviest trucks which do the most damage (to use Governor Raimondo’s logic for implementing truck tolls) to our roads and bridges will be getting relief from tolls EVEN THOUGH THEY WILL NOT BE PAYING TOLLS.

Back to the matter at hand. Approximately $500-$600/year in registration savings for this NON-TOLL RELIEF. Now let’s look at the cost of tolls. At the $40 max per day, a truck driving around in Rhode Island, assuming he operates five days per week, fifty weeks a year:

5 days/week X $40/day = $200. $200 X 50 weeks/year = $10,000/year

Ten thousand dollars a year. Yeah. “Token” relief is actually an understatement, Christopher Maxwell, President of the Rhode Island Trucking Association:

“If they’re trying to help the truck industry, great,” Maxwell said. “But it’s a long way from undoing the damage the tolling would do. It looks to me more like a token gesture.”

Major Correction, Governor: GE is Coming Here Due to Corporate Welfare, NOT an Improved Business Climate

/by

So you’ve probably heard – and if you haven’t yet, Commerce Corp, formerly the EDC, will be sure that you do – the mildly good news that General Electric will be creating one hundred new jobs in Rhode Island, and possibly more down the road.

But in announcing this, Governor Raimondo fibbed in a big way.

“This is real validation that the steps that we’ve taken to improve our business climate … are paying off,” Raimondo told reporters during a Statehouse news conference.

No, indeed. Just the opposite. General Electric is bringing those jobs here due to targeted taxpayer subsidies, a.k.a., corporate welfare. From the Governor’s own Commerce Secretary:

Commerce Secretary Stefan Pryor said the expected cost in state incentives for those initial 100 jobs is $5.65 million, over 10 years.

Look, I don’t agree with it, because it is unfair and bad policy. But the reality is that once in a rare while, tax incentives are needed to land a big fish.

Of course, the problem is that the Raimondo administration, with the unwise acquiescence of the General Assembly leadership, has substituted wholesale corporate welfare for the broad-based tax and regulatory cuts that the state’s business climate so badly needs. Worse, however, is that the Governor is attempting to mischaracterize the business-as-usual corporate welfare that she offered to G.E. as the broad-based improvement to the state’s business climate that she is strangely reluctant to undertake.

Rhode Island ranks forty eight out of fifty on the RI Center for Freedom and Prosperity’s JOI, Jobs & Opportunity Index. I’m not going to ask Justin Katz, the Center’s Research Director and chief architect of JOI, whether one hundred good paying jobs would improve Rhode Island’s JOI ranking, in part, because he has more than enough to do but mainly because it’s a good guess that the answer is: marginally if at all.

More important is the big take-away from the G.E. news, which WPRO’s Matt Allen nailed this afternoon: companies will respond to lower taxes by bringing jobs. Let’s throw open wide our doors by reducing taxes across the board, rather than on a case by case basis.

Clearly Bogus that a Local Drainage Project is Getting a Grant

/by

Community service grants – but not, notably, legislative grants – have been cut back, with some becoming line items in the budget. Speaker Mattiello has outlined the criteria for an organization or project to receive a community service grant.

“If the service could be duplicated somewhere else or it wasn’t significant enough, we just deleted it,” House Speaker Nicholas Mattiello said Wednesday afternoon. “We tried to discern which ones were addressing a compelling need, a unique need that was not being addressed anywhere else in state government.”

Accordingly, how to explain this grant when so many worthy causes lost their grant?

One obscure community-service grant was also added to the list: $200,000 for a drainage restoration project on Elliot Avenue in North Providence. It was not immediately clear why this project was funded when so much else wasn’t, but the town has at least one powerful advocate in the General Assembly: Senate Majority Leader Dominick Ruggerio represents North Providence.

So this grant does not appear to fit the speaker’s criteria. Perhaps, however, the award of this grant has inadvertently revealed an unstated grant criteria: that of the political pull of the grant requester. Dominick Ruggerio is not only the Senate Majority Leader but is employed by New England Laborers. It appears that politics have largely but not entirely been removed from the doling out of community service grants. (Not to be confused with the legislative grant program, which was left completely intact, both in amount and criteria: 100% politics.)

Providence Finance Committee Cuts Taxes … Without Identifying Spending Cuts

/by

Wow. This is a pretty irresponsible way to budget.

The council Finance Committee unanimously approved a $363.9-million tax levy Monday night without passing a corresponding spending plan, making marginal reductions to Mayor Jorge Elorza’s proposed tax rates on owner-occupied homes and rental properties.

State officials agree and have sent a letter to Mayor Jorge Elorza and Council President Luis Aponte expressing alarm.

In a letter sent Tuesday, Auditor General Dennis Hoyle and state revenue director Robert Hull said they understand the city’s need to send tax bills to residents as soon as possible, but called the committee’s decision to approve the tax levy separate from the rest of the budget “ill advised.”

“All components of the budget – both planned revenues and expenditures – must be included to demonstrate that the budget is balanced,” the two officials wrote. “We note that the tax levy was decreased without specific expenditure decreases leaving the budget temporarily unbalanced.”

The city is rushing to get tax bills out so as to minimize the interest it has to pay on a deferred payment to the city’s pension fund. This sure is the wrong way to do it, however. It’s difficult not to believe that the Finance Committee’s irresponsible action here is not mainly inspired by this being an election year [see correction below] and a strong desire to be able to tell voters that they marginally reduced the city’s very high taxes.

UPDATE

Scratch that last theory. WPRI’s Dan McGowan has contacted me and advised that this is not an election year for Providence Council members as they serve four year terms.

Latest (Bad) Rankings of RI: Will the Budget Turn Them Around?

/by

The release of some new/updated rankings of Rhode Island are perfectly timed as we sit on budget watch.

Rhode Island currently has the eighth highest state & local tax burden as percentage of income.

And the Providence Business News points to a new study by WalletHub showing that Rhode Island has the eleventh worst economy in the United States.

These are the rankings that need to be turned around. The Governor’s proposed budget of a couple of months ago won’t get the job done. Will the General Assembly step up to the plate? Judging from alerts via Twitter about the just-announced availability window later today of the Speaker and the new Chairman of House Finance, we will know soon.

Political Scene: Only Four Legislators Attended the Governor’s Rah-Rah Tolls Event Featuring VP Biden

/by

So reports today’s must-read-as-always Political Scene in the Providence Journal

The four Democrats who attended the event under an East Providence highway overpass: Senators Gayle Goldin and Josh Miller, and Representatives Aaron Regunberg and Arthur Handy.

All other legislators, including those who voted for Governor Raimondo’s RhodeWorks toll plan and, notably, the House Speaker and the Senate President, apparently had other plans that precluded them from attending this high profile event.

Oh dear. What happened? Are tolls so politically unpopular with voters that they caused legislators to forego a significant opportunity to get some juicy media attention during an election year? (Don’t be misled by your legislators’ absence. See how your rep voted on tolls here and how your senator voted here.)

Important side note: the attendance of Senator Goldin and Rep Regunberg, who represent Providence, at this event is especially disturbing as, under the preliminary list of gantry locations, five business-strangling gantries would encircle Providence. Respectfully, honorable legislators, how could you attend an event to publicly condone (much less vote for) a new revenue stream that will inevitably heavily damage the residents and businesses in the city that you represent?

FIND GREAT CONTENT

Search through articles, research, and policy papers. Search by keyword, tag, author, date range, and category.

YOUR CART
  • No products in the cart.
Subtotal:
$0.00
0