FY 2009 State Budget Carnage: Rhode Island

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The House of Representatives in Rhode Island unanimously passed a $6.89 billion budget this week that is expected to receive approval from both the Senate and Governor Carcieri. Unwilling to make responsible choices during an election year, lawmakers settled on a budget that includes across the board spending cuts with virtually no tax increases. Ocean State legislators breezed through statutes that would reduce funding of organizations such as Meals on Wheels, the Rhode Island Community Food Bank and the state's largest homeless shelter, Crossroads Rhode Island. A $17.8 million cut from the state's public universities also received little attention, as did a $12.5 million cut in non-school aid funding for cities and towns. Further blows to Rhode Island's impoverished include the elimination of state-subsidized health care benefits for approximately 1,000 low-income parents, the eradication of a program that subsidizes heating costs for the poor, a cap on welfare benefits at 4 years rather than 5 years, and the removal of 300 poor children from the Head Start program.

Requests to reverse tax breaks for high-income Rhode Islanders, such as the capital gains tax or flat tax alternative were ignored. The one tax increase is on health insurance premiums which would be borne by the major insurers -- Blue Cross, United and Delta Dental. These companies will likely pass on those costs to consumers, as they did last year when the tax was expanded. With no other tax revenue increase, the remaining sources of savings or revenue all come with high degrees of uncertainty. Lawmakers are looking to unspecified state personnel cuts to save about $91 million. But this money is only guaranteed if planned labor negotiations go smoothly. In addition, the state anticipates savings of $67 million on Medicare programs; this money hinges on federal approval. Rhode Island will rely on gambling revenues, in an uncertain economy, to allocate $12.8 million in education funding to cities and towns.

Sen. Paul E. Moura, D-East Providence, happily declares, "I think we are coming out of it looking good. Any time in an election year you knock on someone's door and you haven't raised their taxes, it certainly makes the walk a lot easier." As Senator Moura proudly indicates, the motives behind Rhode Island's budget debates this year were almost completely political. And among the victims were the poor, homeless and children who have little to no say in government.

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