An Update from the State House

Pawsox Bill Moves forward
Last week the full Senate voted to pass S.2001 – the Pawsox financing legislation.  The vote was 26-9 which just met the required 2/3 vote for financial pieces of legislation.  Thursday afternoon the House Democratic Caucus met, giving the Speaker the opportunity to gauge where his party was on the issue.  Following the caucus, the Speaker stated that a vote on the bill will be forthcoming after the bill is vetted through the committee process.  He stated that a number of members are concerned over the level of state monies committed to the project and that the S.2001 would likely be amended to place more financial responsibility on the owners of the Pawsox. 
 
Governor’s Budget Released
As you may have heard, Governor Raimondo released her 400 page FY2019 budget.  The $9.37 billion plan includes new revenues, cuts, transfers of restricted receipts, tax and fee increases, new programs, program eliminations and various line items in between.  The Governor, called it a “difficult” budget with “difficult decisions to make.”
 
Approximately 41.6% of the state expenditures are for Health and Human Service programs ($3.898 billion).  Approximately 28.1% of the budget is dedicated to Education ($2.64 billion).  The remainder of the budget goes to the administration of government, economic development programs and environmental endeavors.
 
The actual bill can be viewed at:  http://webserver.rilin.state.ri.us/BillText/BillText18/HouseText18/H7200.pdf
 
The new big ticket items in the Governor’s budget include:

• $1 billion over the next 5 years for school building renovations (phase one is $250 million)
• $25 million bond to renovate the Horace Mann Hall building at RI College
• $45 million bond  for research support as well as infrastructure improvements to the URI Narraganset Bay Campus
• $48.5 million bond for a Green Economy program to improve access to farmland, fund brownsfield programs and to undergo programs to “adapt to weather conditions.”
• $500,00 in new funding for high school students to take college credit courses while in high school
• $4 million in capital funding for FY2019 and FY2020 for a new Education Center in northern RI to connect the state’s colleges with business, industry and community partners.  This center is similar to the one in Westerly that has experience success.
• $200,000 pilot program to pay for child care of low income parents who enroll in full-time college.  RI is one of 3 states that do not have this program
• $3.6 million to fund the second year of the state’s free tuition program at CCRI.  CCRI experienced an increase in first time student enrollees last year of more than 40% ($6.4 million for both the first and second year tuition program)
• $475,000 for a new economic development program called SupplyRI.  The program plans to incentivize large RI businesses to buy goods and services from local companies in order to build the state’s supply chain
• $300,000 to expand the manufacturer’s tax credit for the purchase of equipment to increase production and employment
• $500,000 in new small business loans
• $500,000 for the continuation of the Main Streets initiative for sidewalks, signage and lighting
• $200,000 for a new pilot program to help cities and towns improve permitting and zoning procedures to make them more efficient

On the revenue side, the Governor’s budget, on an initial glance appears to use $89.4 million in new revenues and restricted receipt account scoops to balance the budget.  About $22.6 million comes from new general revenue increases; $9.6 million from restricted receipt accounts and $57.2 million from “other funds.” 
 
The following items account for new use of monies:

• $23.5 million in revenue from sports betting
• $4.1 million from a new “stadium gaming” pilot program at Twin River
• $1.1 million by restructuring the Division of Taxation and, therefore improve collections of the corporate tax
• $20.4 million through the increase of sales and use taxes.  $4.4 million through increase collections by the Division of Taxation, $4.8 million from a new tax on “software as a service (SaaS).  $9.7 million from the expansion of sales tax to security services and armored car services. $1.2 million in new licensing fees from 12 new marijuana compassion centers that will be permitted to also sell to medical marijuana cardholders from MA and CT.  Classification of “acute pain” as a permissible diagnosis to obtain a medical marijuana card ($125,917 in new fees). A 25 cent increase in the cigarette tax effective August 1, 2018.
• $558,142 anticipated increase from greater enforcement of laws to eliminate the underground economy

The Governor also proposed the elimination or reduction of some licensing fees:

• Elimination of the $50 per chair license fee for hairdressers
• Elimination of the $160 retail frozen dessert processor fee
• Reduction of the wholesale food processor fee from $500 to $300

Like last year, Under the Dome will feature a more detailed analysis of the 18 budget articles in weeks to come.  As House Finance Chairman Marvin Abney said, “our work begins.”
 
The following bills were filed last week:
 
House Bill No. 7169, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- PARENTAL AND FAMILY MEDICAL LEAVE (Grants unpaid pregnancy leave to part-time workers, would clarify their access to unpaid sick leave during their pregnancy, and provides additional protections for pregnant workers who work in the medical field.)
 
House Bill No. 7199, AN ACT RELATING TO LABOR AND LABOR RELATIONS - MINIMUM WAGES (Raises the minimum wage effective January 1, 2019, from ten dollars and fifty cents ($10.50) per hour to eleven dollars ($11.00) per hour.)
 
House Bill No. 7220, AN ACT RELATING TO GENERAL ASSEMBLY - JOINT COMMITTEE OF THE REPEALER (Creates the joint committee of the repealer in the general assembly.)
 
House Bill No. 7242, AN ACT RELATING TO LABOR AND LABOR RELATIONS - UNLAWFUL EMPLOYMENT PRACTICES (Prohibits an employer from inquiring about a prospective employee's wage and salary history before an offer of employment with compensation has been negotiated.)
 
House Bill No. 7251, AN ACT RELATING TO MOTOR AND OTHER VEHICLES - COMMERCIAL DRIVER'S LICENSE (Permits the use of fax or email transmission of the medical certificate required for issuance of a CDL by the division of motor vehicles.)
 
Senate Bill No. 2045, AN ACT RELATING TO STATE AFFAIRS AND GOVERNMENT -- TWIN RIVER AND THE TIVERTON GAMING FACILITY (Authorizes state-operated sports wagering at Twin River/Tiverton facilities effective when authorized by federal law/court decision regulated by lottery division with no wagering on RI college teams.)
 
Senate Bill No. 2058, AN ACT RELATING TO TAXATION (Establishes a surtax on the business corporation tax for publicly traded corporations subject to SEC disclosure and reporting requirements, if corporation's ratio of compensation for its CEO to median worker is equal to or greater than 100 to 1.)
 
Senate Bill No. 2075, AN ACT RELATING TO TAXATION - PERSONAL INCOME TAX (Provides for the imposition of a two (2%) tax increase on personal income over two hundred fifty thousand dollars ($250,000).)
 
Senate Resolution No. 2082, SENATE RESOLUTION RESPECTFULLY URGING THE UNITED STATES CONGRESS TO PASS LEGISLATION ESTABLISHING AN IMPROVED “MEDICARE FOR ALL” SINGLE PAYER PROGRAM THAT WOULD PROVIDE UNIVERSAL, COMPREHENSIVE AND AFFORDABLE HEALTH CARE
 
Senate Bill No. 2091, AN ACT RELATING TO TAXATION -- TAX SALES (Expedites the foreclosure procedure on vacant property.)
 
Senate Bill No. 2099, AN ACT RELATING TO CRIMINAL OFFENSES -- LAW PRACTICE (Requires duly admitted members of the bar of this state to acquire and maintain malpractice insurance in the minimum amount of one million dollars ($1,000,000).)
 
Senate Bill No. 2102, AN ACT RELATING TO PROPERTY -- RESIDENTIAL LANDLORD AND TENANT ACT (Requires a landlord to produce proof of at least $100,000 general liability policy for persons injured on premises due to landlord's negligence before proceeding with eviction action.)
 
Senate Bill No. 2103, AN ACT RELATING TO LABOR AND LABOR RELATIONS - OVERTIME WAGES (Exempts certain executive, administrative, and professional employees from overtime pay if their weekly wages exceed one thousand thirty-six dollars ($1,036), an increase from the current two hundred dollars ($200).)