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House Finance Committee Approves $8.7 Billion State Budget

House lawmakers have voted to pass an $8.7 billion dollar budget that restores some proposed cuts and adds money for education and economic development....

House lawmakers have voted to pass an $8.7 billion dollar budget that restores some proposed cuts and adds money for education and economic development.

House finance committee members voted to include many of Governor Gina Raimondo’s proposals to streamline Medicaid and spur business and job growth.  But the budget that now heads to the full House for a vote is $37 million dollars richer than her original ask, thanks to a rosier state revenue picture. House fiscal advisor Sharon Reynolds Ferland gave lawmakers the bottom line.

“As you know the governor proposed about $90 million in savings. At the end of the day, I believe that the budget before you includes roughly $67 million , whether it’s in the form of a little revenue or expenditure savings.”

Highlights include lower corporate taxes, no tolls on trucks, and an increased in the earned income tax to help low and moderate income residents. Cities and towns will see education funding go up more than $30 million dollars.

Lawmakers preserved many of the governor’s original requests to streamline Medicaid. But the better-than-anticipated revenues allowed House lawmakers to be a little kinder to some beneficiaries of Medicaid dollars, said Ferland.

“The governor had proposed a reduction in hospital payments. And in this budget it comes down to 2.5 percent. There’s also the opportunity for an incentive program, and that is as the governor had proposed it in her reinventing Medicaid amendment.”

Hospitals and nursing homes will face gentler cuts in payments than first proposed. Hospitals will also benefit from additional funding to train doctors.

The budget now heads to the full house for a vote.

Reporters were  briefed on the $8.7 billion dollar spending plan - and here are just a few highlights (which, of course, could change!). Here's a link to the proposed budget (Sub A).

Economic development:

  • No "Taylor Swift" tax on second homes
  • Eliminated commercial energy tax (what businesses pay on utilities)
  • Raising earned income tax credit
  • Exempts social security income above $80,000/year for individuals and $100,000 for joint filers from state income taxes
  • Cutting funding for state tourism bureaus, but redirecting funds to statewide tourism ad strategy

Health care:

  • Cutting Medicaid payments to nursing homes by 2%, to hospitals by 2.5% - less than expected
  • Freeze on cost-of-living increases for nursing homes
  • Medicaid payments for uncompensated care at hospitals remains steady
  • Hospitals will see a few million dollars over the next few years for graduate medical education funding
  • Raising tax on cigarettes 25 cents
  • HealthSource RI will be funded by "assessments" or taxes on individual and small business plans, but those taxes will be less - pitched to match what's charged to run the federal exchange (2.8% on individual plans, .59% on small business plans)


  • No truck toll
  • Giving $2 million to RIPTA to help close a budget deficit


  • Plans to fully fund the education formula, sending about $35 million more dollars to cities and towns
  • Adding $20 million for school construction, now that building moratorium is over
  • Extending full day kindergarten funding to cities/towns that don't have it yet

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House Finance Committee Approves $8.7 Billion State Budget
House Finance Committee Approves $8.7 Billion State Budget