Governor Carcieri’s Preview of the Coming Budget Battle

At an impromptu press conference following this morning’s Economic Forum, Rhode Island Governor Donald Carcieri gave a strong hint as to where efforts to address the latest budget shortfall will focus.
This is part of the Governor’s answer to a question on whether the state will be seriously looking at consolidating services between cities and towns in the coming year…

Ultimately we are squeezed, and we’ve made huge changes within the state. The state budget is three pieces. It’s people and benefits including pensions. It’s the social services. And the largest piece of the state’s general revenue budget is aid that goes back to the cities and towns.
We’ve been putting extraordinary pressure on the personnel side [of state government]. I just saw the stats, we’re going to be down about 1,800 people in the last sixteen months. We’ll be down to 12,800, plus-or-minus, FTE positions. That’s the lowest in 20 years in the state. When I came in, I think it was 15,000. So we are shrinking the size of the state in terms of the workforce; you know all of the changes we negotiated in the terms of the contracts and the retiree healthcare.
What I’m saying is that we have really squeezed this hard. And you won’t find any state anywhere in the country that has done more aggressively the personnel piece. We also made major reductions in the human service areas and we’re in the midst of trying to finalize the global Medicaid waiver. We left the local aid in the last budget intact. In fact, they’re going to get more money because out of the 24/3, some of that money goes back into the schools. So at the end of the day, the pressure from what the state is facing is going to go back to the cities and towns, and I’m not going to listen to them just say that they’re going to raise property taxes. That’s when you’ve got to look at the kinds of [regionalization] things you’re talking about.

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15 years ago

Do the math. In light of the huge hit the pension funds have taken, the actuaries will be demanding an equally huge increase in the state’s contribution this year (the fact that RI has the nation’s oldest state work force, and that they are retiring even faster than expected, doesn’t help matters). And apparently, at least according to the Don, social welfare spending is also going to be untouchable this year (excelente, mis amigos). So that leaves aid to cities and towns to cut. Slash, in fact. To the point that either the cap on property taxes has to go, or, even with some regionalization advances, bankruptcies (say, in Coventry, for starters) become highly likely.
But even then, if you check the numbers (as I’m sure one Cranston resident has), you discover that even the complete elimination of aid to cities and towns (i.e., the nuclear option) might not be sufficient to protect both public sector union pensions and our beloved and best-in-the-nation welfare programs.
But neither side in this Mexican standoff on Smith Hill has enough votes to toss the other under the budget bus.
Please fasten your seatbelts, and assume the crash position, Rhode Island.

15 years ago

Someone correct me if I’m wrong but I could swear that Dan Yorke was firing off that NONE of the elected showed up at the meeting to offer or take in any ideas to help their communities.
Sounds about right, a long as the social entitlement programs don’t get touched, all the Democrats are golden and should be double dipping their pensions rightly soon.
Weren’t Rhode Islander smart to elect idiots to run the nuthouse? Wasn’t it a Democratic General Assembly that racheted up the spending over the last few years?

15 years ago

Hey, Roland, none of the leadership of the General Assembly attended, though they were invited. It’s hard to disagree with Dan Y that this demonstrates a lack of professionalism and a marked indifference to the fairly dire straits that the state is in.

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