PROVIDENCE – The budget for state economic development incentives will shift somewhat in the upcoming fiscal year, under the budget introduced this week by Gov. Gina M. Raimondo.
The series of economic development programs initially created by Raimondo in her inaugural budget will receive funds, but in some cases programs will get less than in previous years.
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Overall, the Executive Office of Commerce, which spearheads economic development and housing in the state, will get a boost. The fiscal 2019 budget recommends $62.8 million for the office, an 8.2 percent increase in funds compared to the current budget.
Economic development initiatives, including specific programs intended to attract employers to the state, will receive a total of $20.9 million, if the budget is authorized, according to the budget documents. This is an increase from the $14.8 million approved this year, but significantly less than the first two years of R.I. Commerce Corp., when the programs were established. The increase this year from general fund sources amounts to $3.2 million.
The programs include:
- Among the larger programs, Rebuild Rhode Island would receive another $15.5 million in the new budget. This is an increase of $3 million from the current budget for the program, which provides state funds for catalytic redevelopment projects in which financing gaps are identified.
- The First Wave Closing Fund, a more flexible fund that provides financing for projects considered important by the R.I. Commerce Corp. would receive another $1 million.
- Competitive Cluster Grants: the budget recommends $100,000 for startups in industry clusters and technical assistance grants, within targeted industries.
- I-195 Redevelopment Fund – Another $1 million would be directed to the I-195 district fund, intended to attract redevelopment to the former highway lands. The fund was seeded with $25 million in 2016 and $2 million in the current budget.
Small businesses, often described as the “backbone” of the economy, are getting some attention through six programs. They are aimed at small- and medium-sized employers, according to a broad overview.
They include:
- SupplyRI – the budget would earmark $475,000 for a new program that would help large in-state employers shift their spending from out-of-state suppliers to in-state suppliers.
- Manufacturing Tax Credit – the budget includes a $300,000 pilot for expansion of a tax credit that will encourage small manufacturers to purchase equipment and add jobs.
- Development of pad-ready manufacturing sites – The budget allots $200,000 to help develop vetted, pad-ready sites in the state that can support manufacturing facilities.
- Innovation Voucher grants – The budget includes $1 million more for the innovation vouchers, which allow companies to partner with university researchers, with an added focus on manufacturing research and development.
- Small Business Loans – The budget adds $500,000 to the small business loan fund. Raimondo has said she wants the state to double the number of loans awarded.
- Main Streets on The Move – A fourth year of funding is in the budget for the Main Street RI initiative, for a total of $500,000. A proposed amendment to the existing Rebuild Rhode Island tax credit program would allow tax credits or loans to small businesses on Main Street corridors.
Mary MacDonald is a staff writer for the PBN. Contact her at macdonald@pbn.com.
