Following the conclusion of state and municipal budget deliberations, RIPEC brings you a brief update on public policy developments in Rhode Island.
RIPEC on Public Policy
- Commenting on the recently enacted $13.6 billion state tax and spending plan for fiscal year (FY) 2023, RIPEC President and CEO Michael DiBiase praised the infusion of $100 million in federal American Rescue Plan Act (ARPA) funding into the state’s unemployment insurance trust fund. DiBiase also noted that rising inflation has helped to boost state revenues in the short term but is likely to put upward pressure on expenditures in future budget years.
- Michael DiBiase appeared on WRPI 12’s Newsmakers to discuss the ongoing efforts of Rhode Island municipalities and school districts to effectively spend ARPA funds without creating continuing spending obligations, among other topics.
- RIPEC Manager of Research Justine Oliva told The Boston Globe that May economic data for Rhode Island gives a mixed perspective on the state’s recovery from the COVID-19 pandemic. While a 2.9 percent unemployment rate is “extraordinary,” only 90 percent of Rhode Island jobs lost during the pandemic have been recovered, which trails the national rate of 97 percent, Oliva said.
- Michael DiBiase spoke with WJAR 10 about proposed delays in municipal property revaluations, which make property tax systems less equitable by locking in outdated property valuations and “not taking account of increases.” Earlier this year, RIPEC published a report analyzing the imbalances characteristic of Rhode Island’s property tax systems.
- While there is a wide range of forecasts on the prospect of a recession, economists generally see a rising probability that the U.S. economy will shrink, according to a recent article in The New York Times.
- The National Association of State Budget Officers’ Spring 2022 Fiscal Survey of States shows that states are anticipating general revenue growth to slow to 1.4 percent in FY 2023, compared to 3.2 percent growth in FY 2022. The FY 2023 figure includes the impacts of state-level tax policy changes, which are projected to reduce general revenues by $14.1 billion, or 1.3 percent.
- The Providence City Council approved a budget for FY 2023 that puts the city’s tax structure more out of balance by increasing the homestead exemption for resident homeowners and thereby shifting the tax burden further onto renters and businesses.
What to Look for in July
- RIPEC and the Center for Global and Regional Economic Studies at Bryant University will release their Key Performance Indicators economic briefing for the third quarter of 2022.
- RIPEC will publish its analysis of the recently enacted state budget for FY 2023 and the state’s fiscal outlook.