As 2022 comes to a close, RIPEC brings you an update on public policy in the Ocean State.
RIPEC on Public Policy
- RIPEC President and CEO Michael DiBiase offered insight into Rhode Island’s economy, state budget, and business legislative outlook in a presentation at the Amica 2023 Rhode Island Legislative Training Session.
- RIPEC Research Manager Justine Oliva spoke to The Brown Daily Herald about RIPEC’s recent report on education reform in Rhode Island, which shows that the state’s education system is in crisis and laid out a road map for reform. Oliva argued that RIPEC’s recommendations, which include improvements to professional development programs and an overhaul of the state’s education funding formula, would meaningfully improve student outcomes and are feasible for policymakers to enact in the upcoming legislative session. “The first and most important thing,” she said, “is that education reform is made a top priority in the state.”
- Recent projections from Rhode Island’s Office of Management and Budget’s Fiscal Year 2023 First Quarter Report estimate that the state will have a budget surplus of $610 million in the current fiscal year. Consensus projections from the November 2022 Revenue Estimating Conference (REC) show increases in revenues above enacted levels across a broad range of taxes, including a 7.6 percent increase in personal income tax receipts.
- Despite strong revenues, policymakers will likely be faced with the prospect of an economic decline in the coming months, according to projections by IHS Markit, an economic forecasting firm contracted to provide testimony at the REC. The firm projects that Rhode Island will enter a recession by the end of the calendar year, with increases in the state’s unemployment rate through early 2024.
- A recent article from the Tax Foundation explores the potential effects of Massachusetts’ Question 1, which was approved by voters in November and will move the state from a flat income tax rate system to a graduated rate system. Citing research on the effects of tax changes on migration, the article projects that the Bay State will experience capital flight and a long-term contraction in its economy.
What to Look for in December
- RIPEC will publish the fourth report in its series on municipal finance, analyzing how spending by Rhode Island’s cities and towns on municipal services (exclusive of education) compares to other states and to one another.