LINCOLN –House Speaker Nicholas A. Mattiello, D-Cranston, told an audience of business owners and officials Wednesday the state needs to eliminate the car tax to remain economically competitive.
He sharply criticized a proposal sought by the governor to grant two years of state college tuition to Rhode Island students, saying it would easily cost two to three times what state officials have estimated.
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He heard sharp criticism from small business owners, who said a proposal to require all Rhode Island businesses to provide sick leave to employees would be onerous and too expensive.
And, he said small business owners should anticipate that the state will raise the minimum wage again. The General Assembly had held off last year, after several consecutive years of raises.
“The minimum wage is something I guess most small businesses are not going to want to see an increase, but you’ve got to maintain a standard of living for your residents that other communities have,” he said.
Mattiello addressed these and other topics of importance to business owners at the annual “Eggs and Issues” breakfast, held at the Kirkbrae Country Club and hosted by the Northern Rhode Island Chamber of Commerce.
The issue of a sick leave mandate was raised by audience members. Two people questioned Mattiello as to why the state would add the requirement on businesses, including Mayor Charles Lombardi of North Providence, who said he was speaking as a small business owner. Lombardi said he owns a dry-cleaning business that employs 40 people.
The sick leave legislation now before the General Assembly would require all businesses to provide seven sick days, accumulated based on hours worked.
Lombardi said for his business, this equates to 280 days a year, and if he pays his employees $100 a day, as much as $28,000 a year.
“There are many representatives who need to consider the problems this can cause,” Lombardi said.
Mattiello said he understood that many small business do not want the law changed, but said the General Assembly would have to balance that against the needs of employees who do want it.
On the automobile excise tax, Mattiello reiterated his goal to have the General Assembly reduce it starting this year, as part of a five-year phase-out. He did not offer specific details as to how it could be structured.
Several options are being worked out, he said, conceding the task had been more difficult than he initially anticipated, given the complexities of the tax and its impacts. But people want this relief, he said, and it will help the state improve its rankings based on municipal tax burden.
Once it’s gone, it will help the economy because people will no longer defer car purchases, he said.
“The hard work will be getting it done. But once it’s done, it will be sustainable into the future,” Mattiello said.
On the proposal to provide two years of free in-state tuition at state colleges and universities, which is a priority for Gov. Gina M. Raimondo this year, Mattiello said it would easily surpass the $30 million estimate put forward by state officials.
“That plan is going to go to $60 [million] to $100 million before you can blink your eyes,” he said.
And once it’s in place, if the costs go up, it will be impossible to scale back, he added.
Moreover, Mattiello said his opposition is rooted in its educational effectiveness. He’s not convinced the application of free tuition will strengthen the state’s universities and colleges, or that it will make Rhode Island students more competitive when they graduate.
“The state has, quite frankly, not been a great partner to date at funding higher education. We should be contributing more to higher education. So the solution to the fact that we haven’t been contributing enough, is to say, let’s up the ante? And make those institutions 100 percent reliant on state funding because the student is no longer going to be contributing … for at least two years?”
Mary MacDonald is a PBN staff writer.
