- A balanced budget without structural deficits;
- Investment in education through full funding of the K-12 funding formula and increased aid for higher education;
- Investment in transportation and infrastructure through a dedicated funding source to the Department of Transportation, and a cessation of borrowing in order to meet our federal matching requirements;
- Support for our cities and towns through municipal aid.
The budget that the House Finance Committee passed on Friday contains measures designed to achieve each of these goals. Although it was not identical to the one I proposed in March, the House budget responds to many of the serious problems facing our state that I identified in my budget address and have reiterated over the last three months. I am pleased that the General Assembly recognizes the severity of the challenges facing our state and that many of my proposals and priorities are included in this budget.
However, there are measures I put forth that have not been included. I am
disappointed that the General Assembly chose not to modernize our sales tax
system by broadening the number of items subject to the tax while lowering the
overall rate from 7% to 6%. The General Assembly did broaden the sales tax base
somewhat, but because the May revenue estimating conference forecast an
additional $120 million in FY2011 and FY2012 revenues, they faced a smaller
projected deficit than my budget team and I were expecting in February.
I had also hoped that we would take the first step toward
pension reform by asking state employees to contribute more toward the pension
fund. But I am confident that this issue will be addressed in the fall when we
come together in a special legislative session to achieve comprehensive pension
reform once and for all.
The budget process is ongoing and I will continue to work with the General
Assembly to ensure that the final fiscal year 2012 budget is fiscally
responsible, forward-looking, and sets Rhode
Island
