Issues that divide the candidates

DEMOCRATIC CANDIDATES for governor, top from left to right, Clay Pell, General Treasurer Gina Raimondo, Providence Mayor Angel Taveras; Republican candidates for governor, bottom from left to right. Ken Block and Cranston Mayor Allan Fung will compete in the Sept. 9 primary. / PBN FILE PHOTOS/MICHAEL SALERNO AND JAIME LOWE
DEMOCRATIC CANDIDATES for governor, top from left to right, Clay Pell, General Treasurer Gina Raimondo, Providence Mayor Angel Taveras; Republican candidates for governor, bottom from left to right. Ken Block and Cranston Mayor Allan Fung will compete in the Sept. 9 primary. / PBN FILE PHOTOS/MICHAEL SALERNO AND JAIME LOWE

Making the Rhode Island economy grow and produce bountiful, high-paying jobs are the top priorities of every candidate for governor in 2014.
So frequently are “jobs and the economy” trotted out in campaign rhetoric by leading contenders Ken Block, Allan Fung, Clay Pell, Gina Raimondo and Angel Taveras that the phrase often means little on its own.
What’s more, the tax and spending policies most closely linked with job-creation plans are ultimately controlled by the General Assembly, which means the next governor’s positions on other issues could have a greater impact on employment in the long run.
So when analyzing the economic plans of the five leading candidates in a series of stories published in recent months, Providence Business News also compared their positions on five key issues outside of fiscal policy.
Those issues – the I-195 land, the 38 Studios bonds, HealthSource RI, energy policy and campaign finance – are all issues where the candidates outwardly differ, in some cases outside of simple party lines.
The question of repaying the 38 Studios bonds, for example, has aligned the Democrats with the financial sector that underwrote the transaction while the Republicans are taking a populist, anti-Wall Street stance.
And the I-195 land has split the Democratic and Republican fields respectively, with one candidate in each party more critical of the current process than the others.
Unlike, say, cutting the sales tax, the next governor will have the exclusive authority to appoint members of the I-195 Redevelopment District Commission, pull out of the alliance of six New England governors advocating new natural gas pipelines or scuttle the state health-benefits exchange.
Here is an updated look at how the candidates and issues line up in advance of the Sept. 9 primaries.
The Link
Barrington businessman and Republican candidate Ken Block thinks the current I-195 commission process should be suspended until the next governor takes over.
Block cites: disappointing demand for the 19 developable acres in downtown Providence, which he hopes to change by making the area a special tax zone with a 2 percent corporate income tax rate.
Freezing the process would include jeopardizing the four proposals the commission has preliminarily endorsed and is currently negotiating with their applicants on.
“Instead of taking the scraps on the table, even if they happen to be good scraps, why not wait four months until we can have an aggressive, competitive process under a new governor,” said Block spokesman Jeff Britt. Republican opponent and Cranston Mayor Allan Fung, however, has rejected Block’s call for halting the current four projects plus whatever promising plans come in before the next submission deadline in October.
“Mayor Fung would not support forcing a halt to the projects already moving forward,” Fung spokesman Robert Coupe said, adding that development decisions should be based on “free-market forces” and not a government agenda.
On the Democratic side, General Treasurer Gina Raimondo has been the most critical of the I-195 process, particularly of opponent Angel Taveras’ handling of it as Providence mayor.
Withholding judgment on the commission itself and the projects on the table, Raimondo spokeswoman Nicole Kayner said due to a “lack of leadership from the governor and mayor” the state has not maximized the potential of the land.
She has proposed inviting universities to build an advanced manufacturing institute on one or more parcels of The Link.
Taveras has reserved judgment on the progress of the commission as he works with it in City Hall.
Pell has been the most enthusiastic about the trajectory of the I-195 Commission process so far, saying he “applauded” the agency’s work.
38 Studios Bonds
All three Democrats supported the General Assembly’s decision to make a $12.4 million debt-service payment in the fiscal 2015 state budget. Both Republicans would have allowed the bonds to enter default rather than pay the defunct video game company’s debt.
Pell was the only Democrat to consider default, reserving judgment at the start of his campaign, but then deciding to support repayment by spring.
“Fiscal responsibility,” Pell said about why he supports paying the bonds, and allowing the next governor to “get started on the right foot.”
All three Democrats include borrowing to spur the economy in their agendas, which would become more expensive with the higher borrowing resulting from a default.
How much a default would cost the state in higher borrowing costs remains unknown. A study of the issue commissioned by lawmakers and released earlier this year drew questions and criticism from multiple sides.
Raimondo went so far as to say the specific cost estimate of default doesn’t matter as much as the reputational blow a default would cause the state.
Taveras supported paying off the bonds because he suspects a default would cost more in the long run.
Fung said he could have supported paying the bonds if evidence had indicated that it would save the state money in the long term. In the absence of such information, Fung said he had no choice but to oppose the payment. Block would not have paid the bonds on principle, saying the financial industry had extracted a risk premium on the 38 Studios investments and was now trying to escape that downside risk.
Energy
After years of focusing on offshore wind development, Rhode Island policymakers are returning their attention to land-based energy policy.
Rhode Island’s next governor will decide whether to continue Gov. Lincoln D. Chafee’s support for a New England-wide initiative to build a new natural gas pipeline and new electrical transmission lines for importing hydropower from Canada.
Called the New England States Committee On Electricity, the group’s initiative has been controversial not only because natural gas pipelines and new high voltage lines face opposition in the communities they are proposed, but new infrastructure would be paid for by ratepayers.
The plan was recently thrown off track when the Massachusetts legislature declined to pass a bill to advance the hydropower part so important to Chafee.
Befitting such a complex topic, none of the five candidates have committed yet to supporting the NESCOE pipeline and transmission-line projects like Chafee has.
Pell voiced the most outward skepticism, echoing concerns from environmental groups that the governors have negotiated behind closed doors, but said he will continue to work on regional infrastructure planning.
“I have serious concerns about any proposals that would degrade or threaten our natural resources,” Pell said in an email through a spokesman. “As governor, I am committed to supporting the regional Governors’ Infrastructure Initiative to continue exploration of opportunities for regional energy procurement and infrastructure investment.”
Taveras also seems to be on the fence about the plan.
“I would continue [Chafee’s] collaboration,” said Taveras in an email through a spokeswoman. “However, a thorough analysis of the alternatives needs to be done before committing to raising utility rates to invest in multibillion-dollar infrastructure.”
Raimondo is similarly noncommittal, and said in a statement through spokeswoman Nicole Kayner that she will “work with NESCOE to identify the best options for keeping energy rates affordable.”
On the Republican side, Fung’s concern rests entirely on whether building new natural gas pipeline and electrical-transmission lines will ultimately cost customers more or less than the status quo. “I would like to see additional sources of natural gas available to Rhode Island,” Fung said in an email through a spokesman. “Right now, however, Rhode Island has sufficient generation capacity to meet current demand and we must perform appropriate cost-benefit analyses.”
Block was also noncommittal, with a spokesman saying he supported increasing capacity but doesn’t know whether adding new tariffs is worth it.
HealthSource RI
Lawmakers, Chafee and state health officials don’t know how Rhode Island is going to pay for its health-benefits exchange, so it’s not surprising that none of the candidates for governor does either.
All five candidates say they would keep running the exchange – if it paid for itself either through fees on its own services or by licensing technology and expertise to other states.
There is no sign yet, however, that HealthSource RI can generate any revenue, let alone the $23 million or so needed to run it in its current form.
Both Republicans say they are hesitant to spend that kind of money on the exchange, with Fung less committal than Block, who would establish a 2016 deadline to cut off funding.
All three Democrats are almost identical in their support for HealthSource RI, even if it means using state revenue.
Campaign Finance
While independent campaign expenditures from outside groups like super PACs haven’t played as large a role in the race for governor as many feared, personal wealth has played a larger role than anyone anticipated.
Pell had loaned his campaign $3.4 million as of last week, helping propel him from ballot curiosity into contender while raising questions about whether self-financing is healthy for Ocean State politics.
Block loaned himself a comparatively modest $700,000, drawing criticism from Fung and comparisons to Pell.
Outside groups, such as PACS and labor unions, were secondary players, pledging to stay out of the television advertising war entirely.
The feared pro-Raimondo American LeadHERship PAC dove in with a direct mail attack on Taveras in mid-August, as surrogates weighed in on both sides, but its spending was dwarfed by the campaigns themselves.
The race is expected to be the most expensive in Rhode Island history thanks to the Democrats, especially Raimondo and Pell.
Campaign spending between Oct. 1, 2013 and Sept 1:
• Raimondo: $4.6 million
• Pell: $3.7 million
• Taveras: $2.1 million
• Fung: $670,000
• Block: $617,000. •

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