Politics & Government

State Budget Clears House with No Tax or Fee Hikes

The $8.2 billion budget proposal for fiscal 2014 now heads to the state Senate.

Taxes on wine and liquor would expire, state pensions would get a boost, and the first payment toward the 38 Studios bonds would be made under the fiscal 2014 plan approved by the Rhode Island House of Representatives on Wednesday night.
The new budget would not impose any new taxes or fees, while suspending the plan to put tolls on the Sakonnet River Bridge until at least February, 2014, according to a statement released by the House press office.
Among the Johnston delegation, Rep. John Carnevale [D-Dist. 13], voted against the budget, while Reps. Stephen Ucci [D-Dist. 42], Deborah Fellela [D-Dist. 43], and Gregory Costantino [D-Dist. 44] voted in favor.
Alcohol taxes
A new excise tax on liquor distributors would go into effect under the House budget plan — though by ending the 7-percent sales tax on wine and liquor for a 16-month period beginning Dec. 1, the House proposal is intended to provide some savings to customers.
House members also passed a plan to eliminate the "mandatory mark-up" of 6 percent over wholesale for the same 16-month term.
38 Studios bonds
After an early-morning attempt to stop the payment failed on Wednesday, House members also approved $2.5 million toward the bonds floated by the state in 2010 to support 38 Studios, the now-defunct video game company run by former Red Sox pitcher Curt Schilling.
It's the first payment toward an estimated $90 million in principal and interest that the state faces after officials approved a $75-million loan guarantee intended to support 38 Studios.
The moderate success of Kingdoms of Amalur: Reckoning — which followed several months of disclosures that 38 Studios was not as financially viable as originally believed could not prevent the company from filing bankruptcy in April, 2012, about a year after 38 Studios relocated to Providence.
Sakonnet Bridge Tolls
Less than two weeks before the planned start of toll collections on the Sakonnet Bridge, the House approved a delay until at least February, 2014, as part of its budget plan.
The controversial proposal drew angry response from nearby residents and several attempts to ban the tolls by East Bay legislators.
Originally planned to begin on July 1 by the Rhode Island Bridge and Turnpike Authority, the tolls would be on hold until a study is completed on other ways to fund bridge maintenance.
Pension fund
Under the House version of the budget, a planned $12.9 million payment to the state pension fund would be restored. Legislators identified $3 million from a road and bridge fund; $6 million in expenses from the governor's office, the General Assembly, and the state court systems; and just less than $4 million in other sources to fund the pension payment.
 


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