House votes unanimously to pass budget for FY2016

THE R.I. HOUSE, led by Speaker Nicholas A. Mattiello, unanimously passed the fiscal 2016 budget, including many of the economic development initiatives proposed by Gov. Gina M. Raimondo. / COURTESY R.I. HOUSE OF REPRESENTATIVES, PBN FILE PHOTO/MICHAEL SALERNO
THE R.I. HOUSE, led by Speaker Nicholas A. Mattiello, unanimously passed the fiscal 2016 budget, including many of the economic development initiatives proposed by Gov. Gina M. Raimondo. / COURTESY R.I. HOUSE OF REPRESENTATIVES, PBN FILE PHOTO/MICHAEL SALERNO

PROVIDENCE — With a quick pace and little dissent, the Rhode Island House of Representatives approved a budget for the next fiscal year that includes almost everything proposed by first-year Gov. Gina M. Raimondo.
The $8.7 billion package includes more than $45 million in economic incentives for companies to expand or relocate in Rhode Island, funds to support the state’s health care benefits exchange, HealthSource RI, as well as language codifying a settlement of public employee pension lawsuits.
The budget also includes most of the measures sought by the governor to trim state Medicaid expenses.
Led by Speaker Nicholas A. Mattiello, the representatives approved the budget in a little less than three hours.
The plan takes effect July 1, assuming it is approved by the Senate. The Senate Finance Committee has scheduled a hearing on the document at 3:30 p.m. Wednesday.
In a statement following its passage, he said the document reflects a commitment to improve the state’s economy and encourage job creation. “This budget steers our state down the right path,” he said, “lightening the load on businesses to encourage them to grow and create jobs for Rhode Islanders.”
Raimondo, in a statement, thanked Mattiello and his leadership team. “Our focus is on creating jobs and expanding opportunity, and the budget approved by the House is a great start,” she said. “This is a plan intended to rebuild our schools, attract and grow companies in Rhode Island, make it easier to do business here, and put people back to work.”
House Republicans sparred with other legislators over several articles in the budget, but their numbers were not large enough to sway the votes their way. In the end, the vote for the budget was 75-0.
One of the longest debates ensued when Rep. Patricia L. Morgan, R-Coventry, sought an amendment that would have taken $500,000 intended for Newport Grand marketing for a government efficiency initiative.
She argued the funds for Newport Grand amounted to “corporate welfare.” Several representatives, who spoke against the amendment, pointed out the gaming business directs 60 percent of its profits to the state.
“To take $500,000 away from Newport Grand would jeopardize the integrity of that business,” said Rep. Dennis M. Canario, D-Portsmouth.
By comparison, discussion of other articles in the budget was far more limited. The House members approved the pension settlement language with no discussion, by a vote of 63-10.
State funding for HealthSource RI, likewise, was approved with little debate. A few members did ask the body to wait until the U.S. Supreme Court determines a challenge of subsidies under the Affordable Care Act.
But the majority spoke in favor, arguing Rhode Island had crafted a health care benefit exchange, through recent House Finance amendments, that would make the state exchange no more expensive to run than if the state had chosen to use the federal platform.
Raimondo had proposed a new health reform fee on all premiums inside and outside of the exchange on the small group and individual markets. The fee was estimated to generate about $11.8 million, about half of which would be available in fiscal 2016.
In its review, the House Finance Committee amended the fees, reducing them to be consistent with federal exchange rates. In turn, the state will provide a direct $2.6 million appropriation to HealthSource RI to transition it from federal support.
“For the first time, small business has predictable costs for health care,” said Rep. Deborah Ruggerio, D-Jamestown. “That’s what we’ve created. This is something we really got right.”
A lengthy package of economic incentives created under the new executive Office of Commerce was approved with limited debate. The plan includes more than a dozen specific economic incentives, including $25 million for the Interstate 195 redevelopment district, job creation tax credits, and real estate tax credits designed to reduce the financial feasibility gap for private development in Rhode Island, where developers say taxes are high and rents not high enough.
Rep. Dan Reilly, R-Middletown, said the economic development plan is heavy on government incentives, which carries a requirement for performance. “This governor has chosen to go down the road of intensive incentives, not broad-based tax policy reform,” he said. “I for one expect a lot out of this.”

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