Next for EDC
Now that John Swen has resigned from the Economic Development Corporation, the challenge ahead for Gov. Lincoln Almond is to restore credibility to the agency, and ensure that Rhode Island’s economy remains vibrant. Rhode Island could ill afford the controversy at EDC, given the infamous perception that Rhode Island politics has endured for so many years. In Almond, while some may quibble with his style of leadership, few questioned whether this former U.S. Attorney’s administration would be anything but scandal free.
That may be why this episode at EDC, and the revelations in Almond’s office as well, have created such a public outcry. And it comes at just the same time that a former governor, Ed DiPrete, was released from his term in jail, the result of corruption in his administration.
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For Almond the test comes with the selection of a successor to Swen. We would urge Almond to first look for someone with impeccable integrity, someone of the highest level of our business community possibly willing to take a sabbatical for a short period to help restore integrity to EDC and help keep our state’s economy moving in the right direction.
We believe that the governor should not waste any time in finding a successor. The longer the delay, the longer it will take to get the agency back on track.
In this position we also need a visionary, someone who recognizes that our state’s expanding economy has little to do with what we’ve done here, but what has happened nationally — that Rhode Island still trails the nation in many categories and is challenged to find its place in this knowledge-based economy so it won’t be devastated if the national economy – as it will – slows and eventually enters into a difficult cycle.
Rhode Island needs to be prepared and the first place to begin is by filling the EDC position with someone in whom all Rhode Islanders can put their trust, and who has the vision to help us prepare a strategy for the day when the national economy is not quite as strong as it is today.
Tax treaties
We agree with Providence Mayor Vincent A. Cianci, Jr.’s decision to veto a City Council proposal that would have placed a 90-day moratorium on tax treaties for new businesses moving into the capital city.
Earlier this month, the city council – by a vote of eight to seven – had passed a proposed 90-day moratorium on any new tax stabilization plans. Cianci nixed that proposal with his veto, suggesting that such a moratorium would slow the momentum of development in the capital city.
City Councilman Terrence Hassett, a Smith Hill Democrat who voted against the proposal, called it “short-sighted.”
We agree with that characterization, but we also recognize the importance of the intent of the proposal. What the city council wants is some sense of accountability – a study to determine if those businesses that receive tax breaks from the city are complying with the details of the tax treaty. For example, the city council wants to know if they are creating the jobs they have promised and accordingly deepening the city’s tax pool.
Patricia McLaughlin, deputy city solicitor, has worked on several tax treaties. She said the city council would be pleased with any study it conducts on the tax treaties. Those companies that are benefiting from them, she said, have excellent records of compliance. She points out that Providence Place – perhaps the biggest beneficiary of a city tax treaty in memory – has complied with all of the details of its deal with the city.
Moratoriums, said McLaughlin, send a bad message to existing – and prospective – business owners. We don’t argue that point.
But the city council is on the right track. There seems to us to be no harm in finding out if the tax treaties are working. Tax treaties have long been a center of controversy and discussion, and should be constantly monitored to determine their effectiveness.
So let’s forgo the moratorium, but undertake the study.
