Wed June 26, 2013
It's Day Two and RI House Still Trying to Bang out a Budget
The Rhode Island House resumed the budget debate Wednesday afternoon. It's the second day that followed an unusual defeat for House Speaker Gordon Fox which sent the state's spending plan for the fiscal year starting July 1 into uncertainty.
On Wednesday the House voted 67-4 on a bill that freezes tolls on the Sakonnet River Bridge until February 1, 2014. The legislation also creates a commission to study how East Bay bridges are funded. And a provision in the House budget blocks any toll hikes for Newport's Pell Bridge.
The sticking point on Tuesday was a leadership move to undo a requirement steering surplus budget funds into the state pension fund. The budget article in question was removed from debate two times, showing how Fox's leadership was having difficulty cobbling together enough votes for passage.
Supporters said lower than expected state revenues justified the move to use the surplus to plug a budget hole. Opponents characterized the proposed action as a failure to follow through on a promise to public employees, following the state's nationally publicized pension overhaul in 2011.
In the end, an amended move to make a one-time use of $12.9 million in surplus from FY2012 in the 2014 budget was defeated, 39-36. It was a shocking development, since leadership-backed budget articles are almost never defeated -- and it led Fox to halt the 10-hour budget session at 1:30 am Wednesday, following debate about repaying bonds for 38 Studios. He dashed away to his office without stopping to take questions from reporters.
The unusual setback renewed speculation among political observers about Fox's political future.
It's not yet clear how Fox's team will try to resolve the impasse over the budget. House spokesman Larry Berman said at mid-day the process was still unfolding. Asked about his expectation, House Minority Leader Brian Newberry offered this prediction as the House ended its action early Wednesday: “I think the most likely scenario sometime in the next 12 hours they’re going to take some people into the proverbial woodshed and beat them over the head until they change their vote.”
Also still to be resolved is a plan backed by state leaders to make an initial $2.5 million repayment on bonds issued to fund Rhode Island's ill-fated investment in video game maker 38 Studios. One move to block repayment was overwhelmingly defeated before the House recessed early Wednesday.
The yet-to-be approved budget includes a plan to delay tolls on the Sakonnet River Bridge until at least next April. State DOT head Michael Lewis warned in an email that such a delay could preclude ever adding tolls on the bridge and could also increase tolls on other bridges.
The spending plan also resurrects the state's historic tax credit program, using $34 million in previously allocated money. The program includes a cap of $5 million per project. Debate about the historic tax credit program continued for about two hours, reflecting how the 38 Studios debacle has made lawmakers far more cautious about some kinds of public spending.
Editor's Note: This blog post was updated by newsroom staff at 6:25p.m.