2019 budget bill becomes law
STATE HOUSE – Following passage by the General Assembly this week, the 2019 state budget bill became law with the governor’s signature today.
The $9.572-billion budget (2018-H 7200Aaa), restores proposed cuts to services for the state’s most vulnerable populations and continues the phase-out of the car tax without raising broad-based taxes.
“This is a budget of which we can all be proud. We worked very hard to live within our means and avoid increasing the burdens on taxpayers, while investing in jobs and education, and helping people on Medicaid, seniors and the developmentally disabled. It’s a realistic, responsible budget, and it maintains our commitment to phasing out the automobile excise tax, which I know is important to our state’s taxpayers,” said House Speaker Nicholas A. Mattiello (D-Dist. 15, Cranston).
President of the Senate Dominick J. Ruggerio (D-Dist. 4, North Providence, Providence) said, “This budget includes many Senate priorities, including increased education aid, investment in school buildings, and funding for the care of individuals with intellectual or developmental disabilities and DCYF. It maintains the progress we have made in lowering taxes to improve our business climate while also investing in economic development, and it provides Rhode Island with the highest percentage of revenue in the nation for sports wagering. This was a collaborative effort among the Senate, House and Governor Raimondo, and I am grateful for their partnership in development of this responsible, compassionate budget.”
Flanked by legislative leaders Gov. Gina M. Raimondo signed the budget in a State House ceremony at noon today. The bill passed the Senate Wednesday, after clearing the House June 15.
“The budget process is a long, careful and deliberate process where often, tough decisions must be made in the best interest of all Rhode Islanders. After many months of hearings and negotiation, I am proud of this budget and I am confident that it will serve Rhode Island well into the future,” said House Finance Committee Chairman Marvin L. Abney (D-Dist. 73, Newport, Middletown),
Said Senate Finance Committee Chairman William T. Conley (D-Dist. 18, East Providence, Pawtucket), “This budget accomplishes a great deal for Rhode Islanders by using our resources carefully. We’ve been able to restore funding to help people with disabilities and the Department of Children, Youth and Families. We eliminated almost every transfer to the General Fund from the accounts of quasi-public agencies and state departments, and avoided raising any broad-based taxes. We also moved quickly to be an early adopter of sports betting, and negotiated a very competitive share for the state,” “Additionally, the inclusion of the school construction bond that will help address Rhode Island’s crumbling public school buildings was one the Senate’s top priorities, and I believe Rhode Islanders will support this effort to invest in our schools.”
“A state budget is more than just a spreadsheet. It’s a statement on our values. As Rhode Islanders, we value opportunity, education and community. Because of the choices we’ve made together, our economy is stronger today than it’s been in a generation. We’ve made a lot of progress in recent years, and we need to keep going to ensure that everyone is included,” said Gov. Gina M. Raimondo. “Together, we’re going to fix our kids’ school buildings, ensure everyone has a shot to compete for a good job and protect the most vulnerable people in our state, including Rhode Islanders with disabilities, young people in foster care and our seniors. This budget protects the progress we've made and reflects the values we share. I thank the legislature for their hard work.”
The budget includes a bond question for November’s ballot asking voters to approve $250 million in construction to replace the state’s crumbling public schools, with a requirement added by legislators that communities commit to funding regular maintenance of new schools.
The bill will allow children in foster care to continue receiving state services until age 21. The program will allow young people who are in the care of the Department of Children, Youth and Families on their 18th birthdays to elect to remain in DCYF care until they turn 21. It also includes increases to foster care rates.
Legislators eliminated several proposed cuts to social services. They restored the $18 million proposed cut to programs that serve the intellectually or developmentally disabled, and eliminated $9.9 million in new copays for Medicaid enrollees for services like prescriptions and non-emergency use of emergency departments. They also restored a $15.7 million cut to Medicaid disproportionate care, which reimburses hospitals that provide greater amounts of uncompensated care to low-income patients.
The bill reflects a settlement reached last week over reimbursement rates to nursing homes. With the settlement, there is a 1.5-percent base adjustment effective July 1, 2018, and a 1-percent increase (COLA) that will begin Oct. 1. This means the nursing homes will be receiving a total of 2.5 percent above the current rates by Oct. 1. This translates to approximately $9 million in additional funding, half of which comes from the state’s General Fund, the other half from a federal match.
Out of concern for the effect on small businesses, legislators did not include the governor’s proposal to increase the cigarette tax by 25 cents per pack, nor the proposal to increase taxes on electronic cigarettes and vaping products.
They added resources for the successful Real Jobs Rhode Island training program, funding it at $11 million. Although none of the new programs the governor proposed within the Commerce Corporation were funded, the Assembly extended several business incentive programs that were expiring and continued to fund them, including the Rebuild Rhode Island construction tax credit and the Wavemaker Fellowship program.
The budget bill includes the establishment of legal sports wagering at Twin River Casino, a proposal also put forth in legislation (2018-S 2045A) sponsored by Senate President Ruggerio. A recent U.S. Supreme Court decision cleared the way for states to allow such activities.
The bill reflects an agreement reached with IGT, the operator of the state’s electronic lottery systems which also won the contract for operating sports wagering in the state, following the United States Supreme Court decision to allow states to establish legalized sports betting. Under the agreement, the state is to retain 51 percent of sports betting revenue, with IGT receiving 32 percent and Twin River, which would host the operation at its existing Lincoln facility and its Tiverton facility slated to open later this year, would get 17 percent. Host communities Lincoln and Tiverton would each get annual payments of $100,000 each. Sports gambling is expected to begin Oct. 1 at the state’s casinos.
The other two states that have set formulas for sports wagering so far have significantly lower state shares — in New Jersey, the state is to get 8.25 percent, and Deleware is to get approximately 40 percent.
Despite some tweaks to the proposal, lawmakers still expect sports waging to bring in $23.5 million in 2019, as the governor estimated when she included sports wagering in her budget proposal.
Legislators did not include the governor’s proposal to increase the number of medical marijuana dispensaries from the current three to 15, but did increase licensing fees to the state’s three compassion centers from $5,000 to $250,000. They did include the governor’s proposal to allow Connecticut and Massachusetts medical marijuana patients to purchase marijuana from Rhode Island compassion centers.
Lawmakers added $1 million to the E-911 fund for the purpose of hiring additional staff and creating a plan to help municipalities prepare for 911 systems of the future, and added a new provision to address the practice of transferring surplus funds generated for the E-911 surcharge on telecommunications, limiting spending of that money to public safety programs. The Assembly also eliminated most similar transfers from dedicated accounts to the general fund.
The bill includes the governor’s proposals to apply the sales tax to armored car services and “software as a service” products, expected to generate $9.7 million and $4.4 million, respectively, in new revenue.
The budget includes $976.3 million in state aid to education, an increase of $21.9 million over the current year and $9.6 million over the governor’s proposal. It also includes the governor’s proposal to provide $6 million more for Rhode Island Promise, which provides Rhode Islanders two free years at the Community College of Rhode Island.
The budget includes a program to commit $400,000 to establishing a community senior services grant program for senior centers and programs.
To help address the opioid crisis, legislators concurred with the governor’s proposal to spend $650,000 for behavioral healthcare link, a statewide resource to provide 24-hour community-based assessment and treatment for those experiencing a behavioral health care crisis.
Besides the public school building referendum, the General Assembly also kept the other two ballot questions included by the governor. Question 2 will seek $70 million for improvements to buildings at the University of Rhode Island Narragansett Bay Campus and Horace Mann Hall at Rhode Island College. Question 3 would ask voters to approve $47.3 million in borrowing for a variety of environmental, open space and recreation initiatives, $1.1 million less than the governor proposed.
For more information, contact:
Meredyth R. Whitty, Publicist
State House Room 20
Providence, RI 02903