PROVIDENCE – Gov. Daniel J. McKee on Thursday outlined his plan to spend nearly 10% of the state’s $1.1 billion in American Rescue Plan Act funding to address short-term needs caused or exacerbated by the COVID-19 pandemic.
The governor’s proposed uses for the funds included increasing housing affordability in the state, addressing impacts on tourism and hospitality, investing in child care and child health services, and investing in small businesses and other industries impacted by the pandemic
McKee first began calling for the state to use approximately $113 million of the federal ARPA funding back in late September to focus on immediate short-term needs, including aiding small businesses, noting that Rhode Island was the lone Northeast state that has not used any of its ARPA funding as of yet.
McKee’s formal budget amendment proposals come after R.I. General Assembly leaders House Speaker K. Joseph Shekarchi and Senate President Dominick J. Ruggerio said that McKee needed to submit a formal proposal in order for it to be vetted publicly and voted on in the coming weeks.
In a statement, McKee said if the state invests soon and wisely into recovering from the pandemic, Rhode Island can continue to lead and create opportunities for Rhode Islanders as a result. Lt. Gov. Sabina A. Matos added in a statement that this investment will put Rhode Island on a path forward unlike anything it has seen.
“The future of our great state is bright, and I look forward to the work ahead to build a Rhode Island that is equitable, inclusive and representative of the divers communities in each of our 39 cities and towns,” Matos said.
Shekarchi and Ruggerio said in a joint statement Thursday that both the R.I. House of Representatives and the R.I. Senate began two weeks ago holding hearings on how the state should spend the federal ARPA funding while awaiting McKee’s formal proposal.
The two leaders said their staffs will review McKee’s proposal, followed by a “vigorous public review” by the General Assembly’s finance committees.”This will include consideration of the merits of the expenditures, the urgency of the need, and anticipated recommendations from other groups who have been studying the best use of these funds,” Shekarchi and Ruggerio said.
When asked by Providence Business News if the General Assembly is committed to voting on McKee’s spending proposal this year, Senate spokesperson Greg Pare said in an email that state legislators will decide that during upcoming hearings.
Children, family, social supports
According to McKee’s proposal, $38.5 million will be put toward addressing supports for children, families and social services, receiving the largest portion of the $113 million to be allocated, if approved.
McKee recommended the state invest $13 million to provide retention bonuses to supplement baseline wages for more than 8,200 child care workers, and assistance to new family child care workers entering a market that needs such employees. The proposal includes $12.7 million to provide $1,000 retention bonuses per child educator every six months, and up to $2,000 annually per recipient to full- and part-time staff of state licensed child care providers in the 2022 fiscal year. The remaining $300,000, McKee said, would provide startup grants to cover some costs and technical assistance to providers seeking to open child care sites.
McKee also wants the state to invest $12.5 million to provide workforce stabilization payments to the direct care and supporting direct care staff of service provider organizations that are contracted with the R.I. Department of Children, Youth and Families. Employees earning less than $75,000 would be eligible for monthly payments equal to $695, and it would also allow eligible employees to receive 12 months of payments, including retroactive ones, to the beginning of the 2022 fiscal year.
McKee’s budget also included $7.5 million for pediatric care so that children can be caught up on their health needs. The funds will be used for stabilization grants and a pay-for-success program to pediatric care practices to retain staff and bring on more family supports.
About $5.5 million of the funds would be used for helping early intervention programs, such as for recruiting and retaining workers, avoiding facility closures and additional services for children with developmental needs, per McKee’s plan. Stabilization grants would be provided with about $4.5 million of the funding, and the rest be used for performance bonuses.
Small business and industries
McKee is calling for the state to invest $32 million to help small businesses and industries impacted hard by the pandemic. McKee said the state should aim to deliver 20%, or $6.4 million, to help minority-owned businesses; $10.5 million for technical assistance for local businesses; $7.5 million to increase outdoor activities and public health improvements, such as new ventilation systems; and $1.5 million for outreach, compliance, reporting and administration.
McKee’s budget would include $29.5 million for affordable housing and housing stability supports. Of that amount, $15 million would be to incentivize the development and renovation of affordable housing. It would target helping those whose income is below 80% of the area median income.
Additionally, $12 million would be used for a property grant acquisition program to increase affordable housing supply. Grant funds would be administered by the R.I. Housing and Mortgage Finance Corp.
McKee is also calling for $1.5 million to promote housing stability, and $1 million combined to support both temporary contract staffing support at the R.I. Office of Housing and Community Development and improve broadband infrastructure.
Tourism, hospitality and events
Hospitality, events and tourism, an industry significantly impacted by the pandemic, would get a $13 million boost, per McKee’s proposal. Approximately $8 million will be used for direct grants to support tourism, sports and recreation, hospitality and tourism, arts and culture, and events businesses that need further assistance or couldn’t get previously available funding.
About $3 million will be used for placemaking initiatives, such as outdoor performance venues, public art installations and co-shared dining spaces, by municipalities, chambers of commerce and business improvement districts and developing COVID-safe programming.
The balance, McKee said, will fund tourism marketing that will be coordinated by the R.I. Airport Corp. and local tourism regions.
Update: Adds paragraphs 8-9 with comments from House Speaker K. Joseph Shekarchi and Senate President Dominick J. Ruggerio.
Correction: The governor’s proposals amount to $113 million in spending from the state’s ARPA funds.
James Bessette is the PBN special projects editor, and also covers the nonprofit and education sectors. You may reach him at Bessette@PBN.com. You may also follow him on Twitter at @James_Bessette.