R.I. lawmakers face looming budget troubles
PROVIDENCE - Rhode Island lawmakers will return to the State House next week facing an old problem in the new year: massive budget deficits.
Closing an estimated $450 million shortfall could require a series of unpleasant choices including cutting back on healthcare for the poor, raising taxes or fees, limiting welfare eligibility, or curtailing tax credits for fixing up old buildings.
In a series of interviews with The Associated Press, Republican Governor Don Carcieri and Democratic leaders in the General Assembly said the state's financial health was by far their top concern.
"This is the most important issue," Carcieri said.
Last year, Carcieri and lawmakers relied on a series of cuts and temporary fixes to bridge a similar deficit. They delayed a scheduled decrease in the capital gains tax, cut back state support for day-care subsidies, and tried to save money by sending 17-year-olds to adult courts and prisons - then repealed the provision when it did not work.
Carcieri has not released his proposed budget for the fiscal year beginning in July. While he warns that cuts will be spread across state government, his comments on the subject often point to social welfare spending.
Carcieri said his administration is considering tightening the eligibility rules for state-sponsored healthcare and kicking the children of illegal immigrants off the rolls. He's also studying whether to reduce welfare eligibility to 30 months from 60 months and block increased welfare payments to families that have children while receiving subsidies.
"I don't think that it's the state's obligation, if you will, to continue to pay for children of people who can't afford them and shouldn't be having them," Carcieri said.
Representative Steven Costantino, the Democratic chairman of the House Finance Committee, agreed budget cuts were inevitable, saying he considers no government programs untouchable.
Costantino's committee reviews and amends Carcieri's budget, giving him considerable influence over state spending. While Costantino said lawmakers were against raising income or corporate taxes, they are studying whether Rhode Island could reduce its 7 percent sales tax but apply it to more goods.
Costantino has proposed merging the state's five human service agencies into a single monolith to eliminate administrative functions and cut costs. However, he has not studied how much the plan would save. Carcieri and Senate President Joseph Montalbano, a Democrat, remain unconvinced it would decrease costs.
Passing legislation to drive down prison costs will be a major Senate goal during the next six months, Montalbano said. A recent study commissioned by Carcieri's office predicted that the prison population will increase by 21 percent over the next decade.
Democratic lawmakers, Carcieri, and law enforcement officials are debating whether the inmate population could be reduced by, for example, shortening parole sentences, expanding substance abuse treatment and job training options, and limiting the number of people jailed because they cannot afford bail.
Senate majority leader Teresa Paiva-Weed said she wants to adopt at least some of these recommendations early in the year to save money as soon as possible. 