Rhode Island General Assembly approves Fiscal 2012 Budget and signed by Governor Chafee.
The Fiscal 2012 budget aims at the continuous ailing state economy and growing deficit of $300 million with cuts to various programs, governmental department consolidations, and increased revenues from the previous fiscal year. The budget, amounting to $7.7 billion, includes cuts to various programs created and expanded with the aid of $230 million in federal stimulus money for Medicaid and other health care providers; a situation that many economists predicted and now various Rhode Island health care provides face $78 million in cuts.
The Rhode Island 2012 Fiscal budget includes the following:
- The budget does not include the Governor’s $165 million expansion in sales taxes. However, according to the General Assembly website, “pre-written computer software delivered electronically, insurance proceeds, nonprescription medicine, and sightseeing package tours, and it would end refunds of sales tax that some eligible companies get on construction materials through the Economic Development Corporation and the Industrial Facilities Corporation” are now subject to a 7-percent sales tax. It is estimated the state will generate $17-$25 million in revenue from 2012 to 2013.
- RIte Care eligibility requirements remain untouched with increased co-sharing requirements of $30 a month for families at the 150 to 250 percent of the poverty line.
- Seventeen million dollars for the General Assembly’s new education formula for the next 10-years and $4 million for public higher education.
- An additional $5.5 million for the Payment In Lieu of Taxes program.
- Municipalities: new programs and initiatives for savings assistance, requirements for local retirees on public health insurance programs to participate in Medicare, revenues from state beaches remains untouched, and school committees are no longer required to post their meeting schedules in local newspapers.
- State employee longevity bonuses are frozen to current levels while honoring current contracts but prohibiting the possibility of obtaining further bonuses. It is estimated the state will save $4 million.
- Voters will be asked if they support the expansion of Twin River to a full casino gambling facility with the introduction of table games. If successful, the state is expected to gain 650 jobs and $65 million in new revenue.
- $22 million replenishment of the rainy-day fund.
- As of now, the state borrows annually from the federal government to launch and meet infrastructural requirements; the program remains largely unfunded from the state funding side. Revenue for the infrastructure and transportation programs will come from increased license and registration fees.
- Readjustment to taxable wages and benefits to make the unemployment trust fund solvent.
“This budget,” commented Senator Daniel Da Ponte (D, East Providence and Pawtucket), “required very difficult decisions that will affect many Rhode Islanders, represents a fair and important step forward…the Senate achieved many of its goals…” House Finance Committee Chairman Helio Melo (D, East Providence) commented, “we have enacted a balanced budget that I believe is fair to everyone and puts Rhode Island on sound financial footing…the House felt that Rhode Islanders are struggling enough and we couldn’t place additional tax burden on them.”