As the state debates how to spend a windfall of federal funds, RIPEC provides a brief update on public policy developments in Rhode Island.
RIPEC on Public Policy
- As states around the country begin outlining their plans for spending federal aid from the American Rescue Plan Act (ARPA), state lawmakers and advocacy groups in Rhode Island have begun to turn their attention to the $1.1 billion in flexible funds allocated to the Ocean State. As legislative leaders and Governor Dan McKee deliberate over the best use of the money, RIPEC, along with the Economic Progress Institute, is continuing to support the Rhode Island Foundation’s initiative, Make It Happen: Investing in Rhode Island’s Future, which will publish a comprehensive set of recommendations on how to use ARPA funds to make transformative investments across the state.
- WPRI 12, “Nesi’s Notes: September 25 (#3)”
- The Providence Journal, “With $1.1B in the bank, RI the only New England state not to touch its ‘Rescue Plan’ money”
- RIPEC’s 78th Annual Meeting will be held virtually on November 1st at 5:30pm. RIPEC is pleased to welcome Mara Liasson, Political Analyst for FOX News and National Political Correspondent for NPR, as keynote speaker for the event. RIPEC will also present its annual public service awards to distinguished government employees at both the state and local level.
Inside Insights
- State lawmakers received positive news regarding Rhode Island’s finances in September. According to the preliminary closing statement for FY2021, the state ran a surplus of $332.4 million, $51.4 million more than expected, for the fiscal year ending June 30. The additional savings were driven by general revenues, which were over $200 million more than estimated. Surplus funds can be used to help balance the budget in the current fiscal year or used to fund the FY2023 budget proposal expected in January.
- According to a Tax Foundation report, benefits paid out of Rhode Island’s unemployment compensation (UC) trust fund totaled $3.9 billion from the start of 2020 through September 2021, with most of that sum coming from federal funds. While Rhode Island’s UC fund has no outstanding debt, it currently sits at just 37 percent of the federally defined minimum solvency level. The analysis recommends that state legislatures consider putting ARPA funds toward replenishing UC trust funds.
- A report from Pew Charitable Trusts showed that more states, including Rhode Island, met or exceeded scheduled contributions to state pension systems in 2019, as compared to 2014. Nationwide, state pension systems were 80 percent funded in 2021, their highest level since the Great Recession. However, Rhode Island’s funded ratio of 54.5 percent ranked 46th among the states, beating out only Kentucky, Connecticut, New Jersey, and Illinois.
What to Look for in October
- RIPEC is serving on a study commission established by the Rhode Island Senate that is tasked with analyzing and making recommendations on policy toward tax exempt properties. The commission is slated to begin meeting in the coming weeks.
- Results from the Rhode Island Comprehensive Assessment System (RICAS) tests administered in the spring are expected to be released in October. Amid concerns about learning loss during the COVID-19 pandemic, RICAS scores will shed light on the effects of disruptions to in-person schooling over the past 18 months. Test results from Massachusetts showed declines in student proficiency across the state, including at typically high-performing charter schools.
