PROVIDENCE – The R.I. House Finance committee released a new version of the state’s fiscal 2020 budget Monday, one designed to plug a hole of several hundred million dollars due to lost state revenue and new expenses created by the COVID-19 pandemic.
The spending adjustment, which covers the two weeks remaining in the current fiscal year, moves in federal funds designed for pandemic relief, and employs widespread cuts and transfers to achieve a new balance.
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The budget was $10 billion, including federal funds, as enacted in June of last year. It is now $11.8 billion, plumped up by the additional federal support received by the state.
Rhode Island will receive $1.25 billion in coronavirus relief, with some of it allowed to be used for education and unemployment needs. The relief is contained among several federal acts intended to help states, businesses and individuals recover from staggering losses in employment caused by business shutdowns.
The revised budget, filed under a bill called 2020-H 7170 Substitute A, is scheduled to be discussed by the Senate and House finance committees in hearings on Tuesday, and potentially the full House and Senate on Thursday.
Here are some of the major changes the supplemental budget includes.
- Gov. Gina M. Raimondo had recommended adding $91.1 million more to the enacted fiscal 2020 budget, including an $8.7 million increase in general revenue spending. The House Finance version adds another $1.7 billion to her recommendation, according to an analysis by the House Fiscal Office. Most of these funds come from federal aid, and the largest share is aimed at shoring up unemployment benefits.
- The budget will distribute $91.7 million in new federal funds to Rhode Island schools, primarily from coronavirus relief funds. Every dollar the local schools receive will be reduced in state aid by an equal amount.
- Any school that received Paycheck Protection Program funds from the federal government will have a corresponding reduction in state aid. The PPP funds were available to charter schools.
- Widespread cuts to state offices and programs include $7.7 million to the state’s Housing and Community Development efforts, which are included under the Executive Office of Commerce.
- The Employment Security Fund for unemployed Rhode Islanders will be increased from $162.7 million to $495.3 million. The Temporary Disability Insurance fund, which is accessed by people who have become sickened by COVID-19, or who are caring for people ill with it, will be increased from $203 million to $257 million.
- State labor and training programs, in total, will be increased to $1.9 billion from $449 million in the revised budget.
- The budget eliminates commitments for state capital projects for fiscal years 2022 through 2024, except for those already begun.
- Rebuild Rhode Island, the state’s signature economic development program, which supports new construction and building renovation, will transfer $5 million from its reserve to the general fund. Another $10 million appropriated this year will be taken back, for a total of $15 million cut.
- $500,000 originally intended to support new air service routes at T.F. Green Airport will also be transferred to the general fund.
- $21.8 million will be taken from the R.I. Infrastructure Bank, which helps local communities finance infrastructure improvements. To the extent these funds have already been committed, up to $12.8 million will be taken from a revolving fund for municipal roads and bridges.
- $500,000 in asset forfeiture funds held by the R.I. Department of Behavioral Healthcare, Developmental Disabilities and Hospitals will be transferred to the state’s general fund.
- Unspent bond funds held by the R.I. Department of Environmental Management, estimated at $300,000, will be transferred to the general fund.
Mary MacDonald is a staff writer for the PBN. Contact her at macdonald@pbn.com.
