PROVIDENCE – Mayor Jorge O. Elorza on Tuesday announced a nearly $540 million city spending plan with level taxes for fiscal 2022, a 5.7% increase over the $511 budget for the current fiscal year.
The roughly $29 million increase includes an anticipated $8 million in revenue from taxes and city fees, as well as federal stimulus funds.
There is also a $134.9 million allocation for the Providence Public School District. The city no longer controls the full spending plan for the district, which has been under the state jurisdiction since November 2019.
All tax rates would stay the same under Elorza’s proposal. The plan also continues an exemption introduced this fiscal year that gives small businesses with less than $10,000 in personal property a pass on paying tangible taxes – a policy that helped 40% of city small businesses in fiscal 2020, Elorza said in a speech Tuesday.
His address to the Providence City Council struck a somber tone, recognizing the many losses – of life, business, income and other hardships – brought on by the pandemic. Yet the hardships of the last year did not deter him from laying out a bold vision for the city that includes new spending on racial justice, mental and behavioral health services and a $15 minimum wage for city youth recreation jobs.
Exactly what Elorza’s racial reparations plan will look like remains unclear, but he has set aside $100,000 to fund it. In a Zoom call with reporters Tuesday, he said specifics have not yet been determined but the funding will likely center on the “truth-telling” or community-discussion portion of the plan.
“Sweeping this under the rug has not served us well and there are several examples of other countries and societies that have used reconciliation processes to bring their people together,” Elorza said in his speech. “I believe we will accomplish the same thing here.”
A separate allocation of up to $108,800 would pay for a new equity and inclusion position in the city, as recommended in a recent report about the city’s historical ties to slavery and racial discrimination.
The budget also more than doubles the spending for city department-run services to deal with homelessness and substance abuse, from $150,000 in the current fiscal year to $330,000. Another $600,000 would fund a new crisis diversionary program to improve its Public Safety Department’s ability to address and respond to nonviolent and noncriminal needs such as mental health and substance abuse, which made up over half of calls to the Providence Police Department, according to a recent report.
Despite hours of public testimony in last year’s budget hearing calling for defunding the city police department, Elorza’s fiscal 2022 spending plan actually increases the police department budget by 2% to $93.8 million. This includes $2.9 million for a new police training academy to add up to 50 officers, a program which was included but never materialized in fiscal 2021.
Elorza said that adding services and “reimagining” the role of law enforcement – not defunding it- is his goal.
“Rather than the Public Safety Department being the main hub through which community safety is achieved, the current police and fire departments should be one spoke among many that help to keep our community safe,” he said.
He has also allotted up to $123,795 for a new police department position to oversee community and diversionary services. The fiscal 2021 budget included $400,000 for this position.
While the city has received more than $150 million in federal stimulus funds, only about $16.4 million was included in its fiscal 2022 general fund, which will be used in part to offset an anticipated $6 million loss from hotel and meal taxes, parking and court fees and other revenue-generators still recovering from the pandemic, according to Lawrence Mancini, chief finance officer.
Another $16.7 million of stimulus funds will go to eligible programs, such as summer jobs for youth, the Providence Promise college savings and early scholarship program and public libraries.
The city intends to establish a committee to recommend where to invest the roughly $130 million in additional stimulus funds, awaiting additional federal guidance on how the money can be spent.
The budget also makes the full, $93.6 million payment to the city pension, and sets aside another $100,000 for its rainy day fund.
The City Council Finance Committee is expected to begin reviewing the proposal next week, according to Mancini.
