Winners and Losers in McKee's First RI Budget
GoLocalProv News Team
Winners and Losers in McKee's First RI Budget
The budget has a number of new taxes and fees. It is a budget that former Director of Administration Director and now CEO of RIPEC Mike DiBiase calls a "status quo” budget.
The budget was rushed as the federal $1.9 trillion stimulus package was functionally finalized only last weekend. And, McKee's budget relies heavily on the federal dollars to balance the state's budget.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTDiBiase said McKee "should have asked [the legislature] for more time.”
Speaker Joe Shekarchi said in a statement, "In the brief time Governor McKee has had to fully prepare for his first budget submission, he has been very collaborative and we have developed a good working relationship that I am confident will continue throughout the budget process...I am ever mindful that these one-time funds will not be there to support the ongoing costs of new or expanded programs and we must be prudent in order to emerge from this crisis stronger. The House Finance Committee will now conduct its usual deep dive into every article of the budget in a detailed and transparent public process.”
On Thursday, McKee gave opening comments about the budget in a briefing to the media, but he refused to take questions.
“It is a crucial state budget that needed to be crafted in a short period of time,” said McKee in his prepared remarks.
Instead, state budget officers gave the budget overview.
SEE THE MCKEE ADMINISTRATION'S BUDGET BRIEFING DOCUMENT BELOW
DiBiase tells GoLocal that the proposed McKee budget has some issues that have to be addressed, but called the “approach" is solid.
Winner
Car owners — The McKee budget includes former Speaker of the House Nick Mattiello’s auto tax phase-out.
“Fully funds the car tax phase-out, meaning cities and towns will see $139.7 million in relief,” according to McKee’s plan.
DiBiase warns that the administration cannot use federal funds to cut taxes.
Beachgoers — The McKee administration is hitting those who love the beach -- the parking fees at Misquamicut State Beach in Westerly and the Port of Galilee in Narragansett would go up.
Most fees for Misquamicut State Beach will more than double under McKee’s proposed plan. A Rhode Island resident weekend pass would jump from $7 to $15 and a non-resident pass would increase from $14 to $30.
Winner/Loser
PPP Grant Recipients — Those that received Payroll Protection Plan funds from the feds of less than $150,000 -- they will not be taxed, and for those over the threshold, they will be taxed.
“Loan amounts over $150,000 would be taxed, impacting around 13% of businesses with loans. The proposal would recover $3.6 million in revenue in FY 2021 and $64.1 million in FY 2022,” writes the McKee budget document.
Winner
Cities and Towns — They will receive full funding of state and education aid.
Fully funds the education aid funding formula with a year-over increase of $34.9 million.
Fully funds the Distressed Communities Aid program at $12.4 million.
Funds the Payments-in-Lieu-of-Taxes program at $46.1 million.
Winner
Affordable Housing — McKee is proposing a minor real estate tax on the sale of residential homes over $700,000.
Innovation/Modernization — There is no review of government, waste, or outdated programs.
Winner
Marijuana Industry — Get ready. The McKee budget includes the rollout of legalized recreational marijuana. The program in the first year, due to startup costs, would only generate $1.7 million. McKee's team said in the long-term it would generate $17 million via new taxes.
SEE THE MCKEE ADMINISTRATION'S BUDGET BRIEFING DOCUMENT BELOW
McKee's Proposed RI 2021-2022 Budget
