State office to administer stimulus aid

Gov. Donald L. Carcieri last week said the state must use anticipated federal stimulus money to bridge the deficit, support tax relief and structural reforms, grow jobs and grow our economy.”
That, the governor said in his seventh annual State of the State address, is the purpose of his new Economic Development and Reinvestment Office – created in an executive order he signed prior to the Feb. 10 address. Carcieri said the office will “establish a transparent process” for administering the federal aid.
“To squander this stimulus by avoiding the hard decisions would be an enormous shame, and a great opportunity lost,” he said. “I don’t want our children and grandchildren to pay the price for our lack of courage.”
In his speech in the House chamber before a joint session of the General Assembly, Carcieri spoke of the economic challenges facing the state and the nation, saying “we are in very extraordinary times.” He blamed many of the state’s economic woes on its tax policies, saying “what Rhode Island needs now is more taxpayers, not more taxes.”
The governor said he hopes to phase out the corporate income tax and eventually eliminate the estate tax.
He defended his plans to erase a $357 million budget deficit for the current fiscal year, in part through deep cuts in many state services.
“I know there are many critics. But … Rhode Island has been increasing spending and taxes for decades. That’s why we are so distressed now,” he said.
Going forward, “we need every department of every city and town to sharpen their pencils, tighten their belts, and be smarter about how they spend the taxpayers’ money.”
“These costs are crushing our taxpayers – most of whom don’t have such pensions and health benefits,” Carcieri said.
State employees, he acknowledged, “worked with us last year, recognizing the difficult economic environment. They made major concessions.” But now, he is looking for more. “I encourage every public employee union to sit down with the mayors, town managers, the city and town councils, and the school committees to become a part of the solution. …This is about picking up the burden together.”
The governor is expected to submit a fiscal 2010 spending plan, which will include new tax proposals, to lawmakers by the end of the month. &#8226