Grow Smart recently asked the three candidates for Governor – Allan W. Fung (Republican), Robert J. Healey (Moderate) and Gina M. Raimondo (Democrat) – to respond in writing to seven (7) key policy recommendations from our 2014 Briefing Book for Candidates & Voters [.pdf]. There was no set limit on the length of responses.
What follows are the Grow Smart policy recommendations that were submitted to the candidates and the complete unabridged responses from each candidate.
Sustainable Economic Growth
Grow Smart RI: RhodeMap RI is a coordinated and forward-looking effort by the state to make Rhode Island a better place to live and work by mobilizing state and community assets in a whole new way. Through RhodeMap RI, the State seeks to strengthen our economy, meet current and future housing needs, and plan for future growth through the development of an integrated plan that will also include strategies for transportation, land use and environmental protection. RhodeMap RI’s Economic Development Plan draft is now under consideration by the Rhode Island State Planning Council. The plan outlines goals, policies, strategies, implementation actions, and performance measures for the State’s Economic Development program over the next twenty years. The Rhode Island Department of Administration, Division of Planning’s Statewide Planning Program, working in collaboration with the Rhode Island Commerce Corporation, is responsible for the development of this Plan. The Plan was developed with public and private stakeholder participation, as well as state and federal agency collaboration. It is expected to be formally adopted in November 2014 following a series of public hearings. Grow Smart recommends that the next Governor prioritize and become the lead champion directing swift implementation of the Rhode Map RI Economic Development Plan immediately upon taking office.
- Fung: I share many of the goals expressed in the draft Rhode Map RI Economic Development Plan and look forward to working as Governor of Rhode Island to implement initiatives that are common to the Rhode Map and my own plans to restore our state’s economy. For many months, I have been traveling around the state talking with Rhode Islanders from every walk of life and the consistent message I hear is that we need to restore economic opportunity through job creation. The key to job creation is to make Rhode Island one of the most business friendly states in the Northeast and throughout the United States. The best way to accomplish this goal is to create a business climate that encourages investment and growth. Through comprehensive tax reform and streamlining of government regulation, we will allow businesses to operate more efficiently. Through tax reform, education, and workforce training we will create lasting opportunity and allow hard-working people from every segment of Rhode Island’s diverse population to rebuild a vibrant workforce for our state. To inspire true confidence in our future, we also must reform the way our government operates. I will clean up insider politics and end special deals that harm the reputation of our state. I am pushing for greater Ethics Commission power over the General Assembly and real reforms including term limits, voter initiative, and a line item veto to create transparency and accountability in state government. I will take the best ideas of business, community leaders, and proposals such as the Rhode Map RI Economic Development Plan to partner with businesses, eliminate red tape, and work together to develop solutions that create jobs.
- Healey: I agree with the concept of having a plan for growth and would encourage the adoption of such an idea from day one. I have reviewed the Rhode Map RI and find myself in agreement with many of the stated goals. I agree with the need to have such a policy, although there were few measurements that would test the success in reaching these well intended goals. Without such a method, there must be an assumption that the original goal is the only correct method.
- Raimondo: Rhode Island has everything it needs to be great. I have also always believed that in order to move forward, we need to have a clear assessment of the challenges that lay ahead, and set high standards and goals. RhodeMap RI’s Economic Development Plan does exactly that, and I look forward to building upon the great work that has already taken place.
Replenishing Funding for State Historic Tax Credit
Grow Smart RI: The Rhode Island Historic Preservation Investment Tax Credit, which was available to new projects from 2002 through 2008 and then again from 2013 forward, is estimated to have leveraged $5.35 in total economic output for each dollar of state tax credit investment. It has stimulated $1.4 billion of private investment, incentivized the rehabilitation of more than 250 projects in 24 Rhode Island cities and towns (as of late 2013), and generated thousands of new construction and permanent jobs and tens of millions in new state and local tax revenue. Despite significant evidence of its value, a proposal in 2014 by Governor Chafee to add $52 million in funding for the program failed to be enacted by the General Assembly. Grow Smart recommends that the next Governor call on the General Assembly to approve multi-year funding for the State Historic Preservation Investment Tax Credit, allowing developers to plan on future availability of credits and jumpstarting our lagging construction industry.
- Fung: Rhode Island has had an historic tax credit program that worked well for many years. We have seen how historic tax credits can revive old, abandoned properties and bring them back onto the tax rolls. Some examples include Hope Artiste Village and the Masonic Temple. They help create construction jobs and can leverage federal and private funds. In Cranston, we sought to work with a developer who had an ambitious plan to restore the Cranston Print Works but, unfortunately abandoned the project after the historic renovation tax credits were cut back. I am in favor of historic tax credits to improve blighted areas to spur economic development. As the economy improves in our state, we will determine what we can afford and I would be willing to seek additional funding for historic tax credits in a fiscally responsible manner. These credits must be used to support projects that are commercially viable and are adequately funded with private investment.
- Healey: It would seem that if the government seeks to utilize the historical aspects of Rhode Island to enhance its tourism potential, such an investment would be logical. If committed to such a plan, then the idea of multi-year funding would seem logical as well.
- Raimondo: Our taxes should be structured in a way that encourages growth in targeted industries and incentivizes needed investments. The Historic Preservation Investment Tax Credit not only encourages employment in the building trades (where the unemployment rate is considerably higher than the state average), it also creates and incentive for more Rhode Islanders and small businesses to rehabilitate and maintain our state’s great historical and cultural assets.
Transportation Choices as a Competitive Advantage
Grow Smart RI: Nationally and in Rhode Island, a 21st century mass transit system is increasingly seen as vital to the competitiveness and economic prosperity of a metropolitan area. And ridership on RIPTA has been increasing significantly – now ranked with the 7th fastest growing ridership among large bus agencies in the United States. For many years RIPTA has been weakened by its overreliance on a declining source of revenue (a portion of the state gas tax). In 2014, the General Assembly took an important step in strengthening mass transit by diversifying and stabilizing RIPTA’s operating revenue, including a provision to index the gas tax to inflation. While not completely sufficient to accommodate RIPTA’s growing use, it was an essential step in the right direction, making our transit system more fiscally sustainable. Grow Smart recommends that the next Governor and the General Assembly fine-tune the 2014 transit funding reform policy to further stabilize and strengthen mass transit in a way that avoids service reductions and/or sharp increases in fares.
- Fung: Mass transit is undoubtedly a key component of our state’s overall transportation strategy, particularly given the small size and dense population of urban areas. In fact, I have worked for years to bring a rail stop to the Wellington Avenue corridor in the City of Cranston to capitalize on the opportunity of rail services traveling through the commercial and urban center of our city. I also have proposed undertaking a public/private partnership to fund future construction and maintenance of roads and bridges. I believe this is important step toward improved planning by forcing more analysis of the long-term viability of a proposed project. We need to take a similar look at mass transit. It’s not enough to say simply that we will spend “X” number of dollars – we also need to look at how we are spending it. RIPTA is an integral part of our transportation system, but we must ensure that we are making the most effective and efficient use of those funds.
- Healey: As an occasional user of mass transit, I am somewhat aware of its needs and its shortfalls. I do see a valid need to provide such service and the need to encourage its usage. The overreliance in funding sources is a problem for the system and I see where innovations could be made to make ridership grow even further. I would be more than open to ideas to improve and expand mass transit opportunities.
- Raimondo: I understand the value of public transportation. I relied on the RIPTA bus to get to high school every day. And on the first day of my campaign, I reaffirmed by dedication to public transportation by taking a RIPTA bus from my campaign kickoff to lunch with my family at Gregg’s. A strong public transportation infrastructure will pay many dividends for Rhode Island. It is a critical pathway to opportunity, makes our state more accessible, and will help us attract entrepreneurs and young families who are increasingly looking for cities with robust public transit options. In May, I announced my vision for RIPTA, which included a commitment to further diversifying the agency’s funding source. Our state deserves a world-class public transportation system for many reasons
Revitalized Urban & Town Centers
Grow Smart RI: Rhode Island’s urban and town centers are vitally important to our state’s future well-being because they have concentrations of commerce and population as well as buildings, roads, utilities and transportation infrastructure already in place. By putting an end to the many wasteful public subsidies for scattered development on greenfields and instead focusing on incentives for future commercial and residential growth and re-growth in centers, we can capitalize on existing assets and reap the economic, environmental and community benefits of doing so. Grow Smart recommends targeting and prioritizing discretionary state investments to locally designated and state approved “growth/activity centers”. Examples of discretionary investments include a a new state-funded and executed water and wastewater infrastructure program and incentive policies such as the MicroZone Economic Revitalization Act of 2014 (which failed to win passage) or a reformed Enterprise Zone program.
- Fung: As Mayor of Cranston, I have sought to bring a responsible and balanced approach to development. We have worked to preserve rural areas of our City, through the protection of farmland and open spaces, while at the same time encouraging redevelopment of sites in our more urban areas. I support a comprehensive approach to encouraging development and redevelopment through the creation of a business friendly environment throughout the state. We will face difficult budget questions in coming years; however, it is important to make responsible investments in maintenance and improvement of our infrastructure. Subject to these fiscal constraints, I would also support enterprise zone proposals.
- Healey: My approach to projects of this sort is similar to the concept advocated in this question. As Governor, I would expect to be presented with an approach that determines a need (especially through a triage/prioritization method), provides an approach or method to achieve a stated objective, works to the objective, and tests to see the objective is being met. Once met the next most important need can be considered or if the original goal is unmet, there could be a method readjusted to meet the objective. I think that it is important to re-vitalize activity centers, but I would also question the need to do so if there are few takers without being subsidized. I have greater difficulty accepting artificial markets.
- Raimondo: All of our state’s programs and incentives should be carefully reviewed, strategic, and designed to promote sustainable growth. As I often say, we are not going to cut our way or tax our way out of our economic crisis. We need to grow our way out of this mess, and the only way to do that is to make strategic investments that will position our state and its municipalities for growth well into the future.
A Strengthened Agricultural Sector
Grow Smart RI: The Rhode Island Local Agriculture and Seafood Act (LASA) of 2012 established a small grants and technical assistance program to promote sales of locally grown products, enhance the economic competitiveness of RI agricultural products and seafood and assist small or beginning farmers. The 2014 state budget included $100,000 for the LASA program, and that funding leveraged another $110,000 in private funds. The first call for grant applications in 2014 resulted in 90 applications totaling $1.4 million. The LASA program allocated $190,000 in competitive grants to 17 farm and seafood businesses and organizations and $20,000 for a statewide seafood marketing effort. The 2015 budget again includes $100,000 for the program, but there is no guarantee that funding will continue after 2015. Grow Smart recommends a reliable and sustainable funding stream for the LASA grant program.
- Fung: Rhode Island has a tremendous opportunity to establish itself a leader in the region and beyond in agriculture and food related businesses. We are fortunate to serve as the home of Johnson & Wales and I would foster and encourage greater partnerships with the University to enhance Rhode Island’s reputation as a food capital. We have a great opportunity to pair the success of our local restaurants with a growth in local agriculture and fishing industries. Many Rhode Island restaurants are featuring locally produced food products and thanks to the close proximity to the coast, our restaurants can offer the freshest possible seafood. We even have locally produced wines and I was excited to take part in the opening of Cranston’s first ever brew pub, Brutopia, which relies on locally produced ingredient to again brew beer in Cranston. I will support efforts to foster growth in this industry, including financial support for the LASA grant program subject to budgetary constraints.
- Healey: I support programs related to expansion of Local Agriculture and Seafood. I am not overly sure about a marketing program in that the product should (and does) speaks for itself. I am encouraged by the growth in small local farms and would support efforts to continue their path of growth. In short, I could be convinced, but I see local regulation and taxation as being the force holding back such growth.
- Raimondo: Local food production and agriculture is a growing part of the Rhode Island economy. In the 10 years between 2002 and 2012, Rhode Island added a total of 13.1 square miles of new farmland. Agriculture is not only a bright spot in our economy; it offers an opportunity to improve our state’s nutrition, attract more tourists, and keep our environment healthy. But oftentimes the barriers of starting or running a business can be daunting. I support efforts that will help local farmers and fishers thrive, and will work with stakeholders and policy makers to encourage programs that provide technical assistance and startup capital.
Grow Smart RI: Rhode Island’s tourism industry is the state’s fourth largest employer, supporting approximately 65,000 jobs, generating $2.37 billion for our economy and producing 8.4% of all state government revenue. It’s an industry that leverages our state’s many assets and offers a wide range of entry level jobs as well as significant upward mobility for workers. And yet Rhode Island invests very little in maximizing the potential of this key economic sector. Neighboring states outspend Rhode Island in tourism promotion by nearly 20 times. Grow Smart recommends that Rhode Island increase its investment from $710,000 to a minimum of $3M in order to compete more effectively for its share of the regional tourism industry.
- Fung: Adjusting for inflation, Rhode Island’s tourism promotion budget was nearly three times higher in 1978-1979 than it is today. We are losing our market share at an alarming rate, and one of my priorities as governor will be to reverse this trend. Simply put, we need to leverage our assets and our small size to rebuild our tourism industry. In my first year as Governor, I would seek to increase our tourism budget in the context of a comprehensive strategic plan to revamp our marketing efforts. I would consider further increases in future years. On a statewide level (not accounting for local taxes), Rhode Island currently has the 3rd highest tax rate on lodging, combining the state sales and lodging taxes. My plan would gradually reduce the state sales tax to be one of the most competitive in the northeast. We need to use our small size as an asset to attract more short-term travel from nearby out-of-state population centers.
- Healey: I am skeptical of marketing tourism and I have long been leery of having such an over-reliance on it in that the industry is not constant. That said, I can recognize that tourist dollars are out of state investment in Rhode Island which is pure revenue and not a recycled in-state dollar. We rely on tourism and yet we close down highway welcome stations. In short, we are not committed to this as we should be. I would be supportive of aggressive efforts with a long range, highly defined and coordinated plan.
- Raimondo: Our tourism industry has untapped potential. I believe that with smart, strategic investments in a marketing plan, we can create thousands of new jobs, and invite millions in visitor spending. Our state is rich with museums, restaurants, and natural attractions. We should be inviting people from all over the country, and even across the globe, to visit our cities and spend time on our beaches.
Grow Smart RI: There are a number of critical investments that will be put before voters as bond issues on the November, 2014 election ballot. Question #6 would invest $35 million to leverage federal and private funds towards development of a new Transit Hub in Providence adjacent to the Amtrak station as well as transit enhancements in other parts of the State. Question #7, The Clean Water, Open Space and Healthy Communities Bond includes $5M in funding for Brownfield clean up activity and $3M for farmland acquisition and preservation. Question #5, the Creative and Cultural Economy Bond would authorize the state to borrow $35 million to support improvements and construction to arts and preservation sites around the state and includes $5M in funding for grants to preserve historic public buildings not eligible for the State Historic Tax Credit. Grow Smart calls on the candidates for Governor to support Questions 5, 6 and 7.
- Healey: Unfortunately, I am of the position that Rhode Island is swimming in debt and should carefully examine all spending initiatives. I do not believe the state leadership has clearly committed to a plan (five or ten year) to take action. This haphazard approach to economic development is not in the best interest of the state. This has caused me much trepidation in supporting expenditures of money we do not have. If there were a strategy or a firmer legislative commitment, I would feel far more comfortable with these programs. That said, I also believe it is better to light a candle than to complain about the darkness. I leave bond issues to the voters, but I would work to implement the will of the electorate with complete commitment.
- Raimondo: I fully support ballot questions 5, 6, and 7, and urge all Rhode Islanders to approve them. These strategic investments will make our state more competitive by protecting our natural resources, enhancing our cultural assets, and improving the accessibility of public transportation.