The House Finance Committee approved early Friday a $9.2 billion budget for the fiscal year starting July 1. The budget begins a phaseout of the car tax while also launching a new program to offer free college tuition to students at the Community College of Rhode Island.
The Finance Committee approved the spending plan on a 15-to-4 vote, with four Republicans voting in opposition, shortly before 1 a.m.
House Speaker Nicholas Mattiello, who unveiled his plan to eliminate the car tax in the face of a tough re-election challenge last year in his Cranston state rep district, praised the budget as a balanced plan that reflected compromise and a commitment to Rhode Islanders.
"We are going to take 150,000 vehicles off the car tax rolls in the first year alone," Mattiello told reporters during a briefing ahead of the Finance Committee vote. "It's a regressive tax, it's an oppressive tax, and we're taking a well-thought-out bite out of it in the very first year."
The speaker said the budget steers clear of broad-based taxes. The spending plan does include a 50 cent hike in the cigarette tax proposed by Governor Gina Raimondo.
Raimondo's communications director, Michael Raia, said the governor's office is delighted by the inclusion of about $3 million to start the governor's free college tuition initiative at CCRI. While Raimondo had called for also including URI and Rhode Island College in the effort, Raia said Rhode Island will become just the fourth state to offer students free tuition at a community college. Participants in the program will need to maintain a 2.5 GPA and remain in the state for two years after graduation.
The speaker incorrectly asserted during his briefing that the college tuition plan includes a community service requirement. It remains unclear if that may be added as an amendment.
Mattiello dismissed suggestions that he was disinclined to support Raimondo's college tuition plan. “Whenever you’re creating a new program, they’re always nuances and even if you like the premise, you’ve got to make sure that the nuances don’t create problems that are difficult to deal with," he said. "So that’s the approach I always come from.”
In a statement, the Republican Governors Association tweaked Raimondo for getting only part of her proposed college tuition initiative "after spending months promoting her plan and even enlisting the help of the Democratic Governors Association to spend almost a half a million dollars on a national PR campaign backing it."
The speaker said the legislative budget restores almost all nursing home reductions in the governor's budget; provides for increases for home care workers and workers working with the developmentally disabled; and raises the minimum wage in two steps, by 50 cents next January 1, and an additional 40 cents on January 1, 2019.
The budget also includes money to offer free RIPTA bus passes for the elderly and disabled for the next two years.
Mattiello said an explanation of how the budget wipes out a $134 million deficit defies an easy summary, although he said the legislative budget does not include additional human service cuts beyond those proposed by Raimondo. A six-page printout lists a lengthy series of cuts, including how the governor's office is expected to make $25 million in unspecified cost reductions.
"The Senate will carefully review the budget being considered by the House Finance Committee tonight," Senate spokesman Greg Pare said.
The full House is slated to vote on the budget next Thursday.
Mattiello said the floor debate will not go past 10 p.m. and will instead carry over until the next day or two, if necessary.
The budget trims a variety of Commerce RI programs, althoguh it preserves two of the economic agency's priorities, the Rebuild RI and Qualified Jobs tax credit programs.
The Economic Progress Institute offered a largely favorably reaction to the House budget.
“The state budget lays out the plan for achieving our shared values, and specifies the investments we’re making so Rhode Island families can prosper and our communities can thrive. The House budget proposal hits the mark on some fronts, while falling short in others,” Rachel Flum, the EPI's executive director, said in a statement.
"The Institute is pleased to see that the budget restores funding for bus passes for the elderly and disabled and makes permanent additional funding for schools to ensure that English language learners can succeed. We support funding for the RI Promise proposal, providing free tuition to Rhode Islanders attending CCRI, noting especially the impact this will have on the ability of lower income students and students from communities color to attain higher education. We are disappointed that this opportunity is limited to immediate high school graduates and not available to the current workforce or at least young adults who may not have gone directly to college. We are glad to see the increase in the minimum wage, but see no reason for achieving $10.50 over two years instead of one."
Flum expressed concern about "the lack of investment in the child care sector and the repeal of the $1 million the Governor proposed to help increase provider reimbursement rates which are currently woefully inadequate."
"While the investment in education through the College Promise is limited to the next four years, the car tax phase out is enacted in its entirety over the next seven years," she continued. "The decision to proceed with the phase out of the motor vehicle tax takes $26 million off the table in FY2018 that could be better used to meet pressing needs in Rhode Island, and in setting in motion a cut that will eventually reach $221 million (with inflation adjustment) annually, this decision turns a blind eye to looming federal budget cuts. We are very concerned that this decision reduces our ability to make smart spending choices needed to help Rhode Island prosper in the coming years."
This story has been updated.