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Budget gets House OK despite hot debate

June 26, 2013

PROVIDENCE -- Votes to establish a state budget are annually strange and unwieldy affairs, but the $8.2 billion document that squeaked through the House of Representatives Wednesday night with just two votes to spare was one for the books.

It featured the nearly unprecedented defeat of an entire budget article, which knocked the carefully crafted house of cards $12.9 million out of balance, sending lawmakers and staffers scrambling to fill that yawning hole with cuts from other areas of government. For the first time in recent memory, representatives were sent home early Wednesday morning without a final budget vote, forcing them to return nearly 13 hours later to finish the job.

Looming over the entire exercise was the $2.5 million allocation to make an initial payment on the ill-fated 38 Studios bonds that threatened to run the entire process off the rails.

In the end, after several hours of back-and-forth debate, the House voted 50-20 to approve the tax and spending plan and send it to the Senate, where the debate is expected to be shorter, less rancorous and altogether more orderly. Just hours after the House vote, the Senate Finance Committee voted to approve the plan 9 to 1 with one abstention. Lincoln Rep. Edward O’Neill, an Independent, cast the lone no vote. The full Senate will take up the budget later today.

The reason the result in the House was so close is that the state Constitution requires a two-thirds vote on measures that allocate public funds for local or private purposes such as state aid to municipalities and school districts.

Just before midnight on Tuesday, representatives blindsided their leadership and budget writers by rejecting an article that took the $12.9 million from a previous year’s surplus that had been earmarked to cover other expenses. Lawmakers who just two years before had gone through the wrenching process of a controversial state employee pension reform that is still tied up in the courts balked at the notion of not making the promised pension payment.

To make up that $12.9 million, the House voted to scoop $3 million from a proposed $10 million revolving loan fund designed to make it cheaper for cities and towns to borrow money for road and bridge repairs. Now that program will have just $7 million for the state’s 39 municipalities to fight over to fund their various road projects. Pawtucket officials said last month they need $28 million to bring all of the streets in their city to an acceptable condition.

Also, $6 million, nearly half of the shortfall, will be made up by not filling vacant positions in various government departments. Another $3 million came from “fund swaps,” in which departments that expected to receive one-time savings lost that money to the budget gap. Almost all of the rest of the remaining $900,000 will come from a mortgage settlement agreement entered into by the attorney general’s office.

Numerous attempts to use the $2.5 million slated for the 38 Studios payment for different purposes failed. Among those were Glocester Republican Rep. Michael Chippendale’s bid to put that money toward programs for the developmentally disabled – “If you vote no on this, I will pray for you,” Chippendale told his colleagues – which lost on an 18-53 vote and one by Cumberland Rep. Karen MacBeth to funnel the $2.5 million to the 39 cities and towns, which went down to a 20-51 defeat.

As the chamber was about to pass judgment on the entire budget package, after picking it apart article by article in approximately 12 hours of debate, North Smithfield Rep. Brian Newberry, the House Republican leader, told the chamber “This is the only vote that really matters. At the end of the day, whether you voted for a particular article or not, when you vote for this budget, you own everything in it – the 38 Studios funding, whatever else is in it you may not like. This business where you vote against an article, but you vote for the budget, I’m tired of hearing that.

Warwick Rep. Joseph Trillo, also a Republican, said, “Because of this 38 Studios deal, compromises had to be made all over the place. The first compromise we had to make, we had to take the tolls off the Sakonnet River Bridge, so we took care of that.” Tolls on the bridge expected to start July 1 will now be put off until Feb. 1 of next year and in the meantime a study committee will look a the need for tolls. House Finance Committee Chairman Helio Melo of East Providence said that during that period, the tolls on the Newport Pell Bridge would not increase, either.

Calling the 38 Studios money “the elephant in the room,” Trillo said, “we could have stopped it if we really wanted to stop it.”

Fellow Warwick Rep. Joseph McNamara objected to Trillo’s referring to “deals that reflect on the integrity of our members,” and Trillo was cautioned by Speaker Gordon Fox.

It barely slowed him down, however.

Referring to the 2010 vote that put $125 million into a loan guarantee program for the RI Economic Development Corp., $75 million of which went to 38 Studios, the video game start-up owned by former Red Sox pitcher Curt Schilling, Trillo said, “I want to know why I was lied to that night. And the only way I am going to know is with an investigation that does not come out of this state. The only way we are going to get that investigation is when we don’t pay the bonds and let the insurance companies go for a full investigation and let the chips fall where they may.”

MacBeth said she will ask for a federal investigation of the EDC loan guarantee program (which the House eliminated in another budget article). At the time of the 2010 vote, MacBeth said, those pushing for the program “looked us in the face and lied at us.”

Follow Jim Baron on Twitter @Jim_Baron

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