Rhode Island lawmakers pass $11.8B supplemental budget

Lawmakers in both the House and Senate passed an $11.8 billion supplemental budget Thursday, 12 days ahead of the June 30 deadline, which marks the end of the fiscal year.

"It's something that we have to do," said Rep. Julie Casimiro, D-Dist. 31. "We have no choice but to pass this supplemental budget."

The supplemental budget is nearly $2 billion more than the budget enacted by the General Assembly last June, mainly due to the additional $1.5 billion in federal aid for COVID-19.

The new proposal closes a $250 million funding gap for the fiscal year that ends on June 30 by tapping $120 million from the state's rainy day fund, a move that hasn't been done since 2009. The money will have to be paid back next year.

"We have a spending problem and a revenue problem," said Rep. David Place, R-Dist. 47.

Lawmakers said there were no cuts or tax increases, also proposing to use $50 million from the state's $1.25 billion in federal Coronavirus Aid, Relief, and Economic Security (CARES) Act funding to help school districts, with much of the money going to those with high concentrations of low-income students.

The budget will replace nearly $40 million of the state's obligations to local school districts with $41.7 million in CARES Act funding already earmarked for schools.

The supplemental budget also taps unspent funds from some agencies, including $17.8 million from the Rhode Island Infrastructure Bank, $300,000 from the Department of Environmental Management bond issues, $500,000 from forfeited assets collected by the Department of Behavioral Healthcare, Developmental Disabilities and Hospitals, and $15 million from the Rebuild RI tax credit program.

"Some departments over spent, some departments under-spent and we had to do the reconciliation," said House Speaker Nicholas Mattiello, D-Dist. 15.

But some lawmakers argue the process was done too fast and without proper review.

"I don't think anybody in that House had the time to digest everything that was in that budget," said Rep. George Nardone, R-Dist. 28.

House Minority Leader Rep. Blake Filippi, R-Dist. 36, said documents were provided to lawmakers too close to the vote.

"We don't know what's in this thing," he told NBC 10 News Thursday. "I'm sure a few people do. The vast majority of people in that room have no idea what's in it. So, you break it, you buy it."

The extreme deficit fueled by the COVID-19 crisis, which caused state revenue to plummet, left lawmakers with less revenue to help fill the gaps.

"Revenue was just not coming in, but our expenses were continuing and actually significantly increasing as well," said Rep. Joseph Shekarchi, D-Dist. 23.

A large chunk of money in the budget is allocated towards increasing revenue loss at Eleanor Slater Hospital.

The House Fiscal Advisor told the House Finance committee Thursday the hospital was not in compliance with federal Medicaid rules from August until February, so patients could not be billed through Medicaid or Medicare as expected. That resulted in a $50.1 million in revenue loss, on top of unresolved prior billing issues due to the UHIP computer system, which account for another $14.6 million.

The state could face an additional $12.2 million in costs if the Executive Office of Health and Human Services does not meet a June 30 deadline to address the billing issue.

"It's a lack of responsibility at the executive level and the General Assembly now has to come back in and clean that up," Place told NBC 10 News Thursday.

Mattiello said lawmakers will come back later this summer to address a nearly $600 million shortfall for the next budget year which starts July 1. He said the state is still waiting to see if the federal government will provide additional financial relief to avoid devastating cuts due to significant revenue loss.

"I don't want to make any cuts that we may not have to make," Mattiello said. "That would be unfair to people. So, what we're going to do is we're gonna get a little more clarity from the federal government and then we'll move forward."

The supplemental budget now goes to Gov. Gina Raimondo's desk.

A spokesperson for the governor sent NBC 10 a statement, saying:

The Governor is grateful for the General Assembly's hard work in developing and passing this supplemental budget under such unprecedented circumstances and looks forward to reviewing it with her team. She also appreciates that the legislature is waiting to address the FY21 budget until we receive more clarity from the federal government on the potential for a future stimulus package.