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State of Rhode Island General Assembly
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2024 state budget signed into law
STATE HOUSE – The General Assembly has approved and the governor has signed into law a $14 billion budget for the 2024 fiscal year that commits funding toward addressing the housing crisis, supports business development and makes education funding more equitable while limiting the use of one-time revenue to one-time expenditures.
The budget bill (
) was signed by Gov. Dan McKee today after passing the Senate on a 32-4 vote yesterday and the House on a 68-4 vote June 9.
"We have passed a responsible, balanced budget that helps Rhode Islanders now and positions our state for strong fiscal health in the future. We’re putting our resources where they are most needed — helping small businesses with relief from the tangible tax, preserving and expanding important programs for early childhood and supporting a wide variety of initiatives to tackle the housing crisis — while also guarding our future with a new supplemental rainy day fund. This budget is the result of months of hard work by the Senate and House leaders, our two finance committees and staffs, and the governor’s administration with the input of countless government leaders, advocates and concerned citizens, and it reflects the effort and cooperation that went into it,” said Senate Finance Committee Chairman Louis P. DiPalma (D-Dist. 12, Middletown, Little Compton, Newport, Tiverton).
Said House Finance Committee Chairman Marvin L. Abney (D-Dist. 73, Newport, Middletown), “This budget was carefully crafted so that our residents, particularly our most vulnerable, retain the supports and assistance that they and their families need, so that our businesses have the ability and opportunity to grow, and so that Rhode Island is situated to withstand a very possible financial downturn that will affect both our state and national economies. Responsible, compassionate and thoughtful decisions were made to create a budget that will benefit all Rhode Islanders and this budget positions the state to be as competitive as possible into the future.”
To help address the state’s housing crisis, lawmakers added an additional $39 million from the original proposal to support housing development. That includes $21 million from State Fiscal Recovery funds for a new program that allows the Secretary of Housing to target projects, including $4 million for transit-oriented development and $4.3 million to be transferred to the Infrastructure Bank to support infrastructure necessary for housing development, such as road and utility connections.
The budget includes, subject to an annual $30 million cap, a Low Income Housing Tax Credit (LIHTC) program. The LIHTC program would provide a tax incentive for developers to expand subsidized housing options for low-income households. States that make LIHTC investments have been able to leverage additional federal resources and successfully close financing gaps needed to finalize development and start construction on new housing. The new program will award tax benefits to developers through a competitive process.
Legislators included $45 million from State Fiscal Recovery funds to increase facility capacity for individuals experiencing homelessness, three times the current level. Along with the increased funding is a change that allows the money to be used for homelessness prevention and stabilization programs.
In addition, the Assembly fully funded the Department of Housing’s request for 21 new employees for the State Housing Department.
Lawmakers did not include a proposal submitted in the governor’s housing amendments authorizing eminent domain powers for the Department of Housing.
An amendment added when the House approved the bill last week added $7 million for early childhood programs from unspent federal funds. This includes $3 million to preserve for Head Start and Early Head start seats and $4 million for a pilot program to expand eligibility for child care, at no cost, to certain child care workers.
The budget includes a $45 million investment into the life sciences sector. Funds would be used for the development of much-needed wet lab incubator spaces and support grants, loans, business development and incubation services to grow this sector. The budget also creates a new quasi-public entity to coordinate life science initiatives, which was a proposal introduced in separate legislation (
) by Speaker Shekarchi and Senate President Dominick J. Ruggerio.
To help working Rhode Islanders, the budget increases the earned income tax credit from the current 15% to 16% of the federal credit. Also included is $35.6 million to suspend collection of the gross receipts tax on electricity and natural gas billed to consumers next winter; $18.3 million would benefit residential customers, and $17.3 million would provide relief to commercial customers.
To support business, especially small business, the budget includes a $50,000 exemption for all businesses subject to the tangible tax, as proposed in legislation by Sen. Melissa Murray (D-Dist. 24, Woonsocket, North Smithfield) and Brandon T. Voas (D-Dist. 57, Cumberland, Central Falls). The exemption completely wipes out the tangible tax — viewed as an administrative burden for small businesses and for the municipalities that collect it— for 75% of Rhode Island businesses. The state will reimburse municipalities for the lost revenue.
The budget does not include the governor’s proposal to reduce the sales tax and corporate minimum tax or pause a scheduled 3-cent increase in the gas tax.
The bill increases funding for the Rhode Island Food Bank by $3 million to help address food insecurity.
Currently, retired public employees in the state’s pension system receive Cost of Living Adjustments (COLAs) every four years. The budget does not change the amount retirees receive, but changes the distribution schedule so retirees receive smaller adjustments annually. To improve the health of the pension fund, lawmakers added a new requirement that half of all general revenues received in excess of the adopted revenue estimates in the completed fiscal year be transferred to the Employees Retirement System. In addition, the budget requires that the Rhode Island General Treasurer conduct a comprehensive review of the impact of the 2011 pension overhaul and different proposals to reform the system.
In response to the struggles of school districts, the budget reforms the school funding formula by modifying poverty measures, increasing funding for multi-language learners and phasing in funding decreases due to declining enrollment. The budget allocates $20 million above the governor’s request, including $6.7 million more going to multi-language learners and $5.2 million more for high-cost special education. The bill allocates $4 million to the governor’s Learn 365 RI program for after school learning.
In higher education, the bill includes the creation of the Hope Scholarship, a pilot program proposed by Senate Majority Leader Ryan W. Pearson (D-Dist. 19, Cumberland, Lincoln) and House Education Committee Chairman Joseph M. McNamara (D-Dist. 19, Warwick, Cranston), to cover the cost of two years of tuition and mandatory fees for eligible students during their junior and senior years at Rhode Island College. The proposal is intended to increase educational opportunities and success for students and to improve workforce development.
The budget also funds the proposed Institute for Cybersecurity & Emerging Technologies at RIC. The Institute will position Rhode Island to lead the region in developing highly-skilled cybersecurity professionals through certificate, bachelor, and master’s level courses and programming while attracting leading researchers and education professionals to develop practical and policy approaches to current cybersecurity challenges.
The state’s struggling hospitals will receive an additional $14 million injection of funds, $5 million of which will come from general revenue and $9 million of which will come from federal funds.
The bill includes $20 million from State Fiscal Recovery funds for a matching grant program that will help cities and towns fund local road, bridge and sidewalk repairs.
It also includes an additional $750,000 for total funding of $1.8 million from State Fiscal Recovery funds for the Turnpike and Bridge Authority to conduct a study to identify and evaluate the options to prevent and address the risk of suicide on all four of the main bridges under its purview. The study is underway and is anticipated to be complete in spring 2024.
The budget will provide 15 additional employees for the Attorney General’s staff, including fully funding a new cold case unit, paid for by settlement funds.
And in anticipation of slowing economic growth in future years, the budget allocates an additional $55 million to a supplemental rainy day fund, and requires that half of all general revenues received in excess of the adopted revenue estimates in the completed fiscal year be transferred to it.
The budget reflects the May revenue estimate that was $61.2 million lower than projected last November.
For more information, contact:
, Communications Director for the Office of the Speaker
State House Room 322
Providence, RI 02903
Lt. Governor's Office
Secretary of State
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