PROVIDENCE – Gov. Donald L. Carcieri has criticized the 2009-2010 budget plan approved by the House Finance Committee late Wednesday, but did not say he would veto the proposal.
“While the budget does make some very difficult choices and includes pension reform, it does not include much needed structural changes that will move the state forward and make us competitive to create jobs and grow our economy,” Carcieri said in a statement. He noted that the plan “includes an increase in the overall tax burden” for state residents.
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The Finance Committee’s $7.76 billion tax-and-spending plan is up 12 percent from last year, although the federal government is picking up more of the tab. It increases the state’s capital gains and gasoline taxes, scraps the governor’s plan to phase out the corporate tax and includes only some of the changes to the state pension system Carcieri proposed. It also restores some social services that the governor’s original budget proposal would have cut.
“The only way we can turn this state around and begin to pull ourselves out of this economic decline is to grow our economy,” Carcieri said. “We need a tax structure that encourages businesses and individuals to stay in stay in Rhode Island, to invest in Rhode Island, to grow our economy and to grow jobs.”
The governor’s statement on this year’s budget did not threaten a veto, but concluded: “I hope to work with the leadership of the General Assembly to secure approval of a responsible budget plan that puts Rhode Island on the path of economic recovery.”
Providence Mayor David N. Cicilline also weighed in on the House budget, saying in a statement that the proposal’s elimination of sharing revenue with municipalities – a proposal backed by the governor – “adds to an already serious fiscal challenge facing the city.”
“This will require some very difficult decisions,” Cicilline said. He said he would continue to push the city’s employee unions to accept contract concessions and his proposal to raise new fees from nonprofit colleges and hospitals in order to avoid hiking property taxes.
The full House is scheduled to vote on the budget next Wednesday.
An earlier version of this article incorrectly said Gov. Donald L. Carcieri vetoed last year’s budget.
