Tag Archives for House Finance Committee

Fund the Historic Tax Credit Program

Published in Pawtucket Times, June 13, 2014

With November’s election cycle looming, state lawmakers are moving quickly to finish the people’s business. Once the session ends they will begin their political campaigns to garner votes to retain their seats. .Yesterday evening the House began its floor debate on the House Finance Committee’s $8.7 billion 2015 budget proposal. At press time, this columnist has no knowledge of the outcome. But, when the dust settles late Thursday evening, if a budget amendment to fund the HTC program is defeated or even if supporters are successful in getting one passed, the Senate chamber becomes the next battle ground to fund the tax credit program.

Last week, the House Finance Committee declined to recommend funding for this program, despite Governor Chafee’s inclusion of $52 million for the Historic Tax Credit (HTC) program in his FY 2015 Budget proposal. As a result, Grow Smart Executive Director Scott Wolf and his fellow Historic Tax Credit advocates are running a full court press to push House and Senate leadership to include funding for the popular economic-development and neighborhood-revitalization program in the 2015 Budget.

In the lobbying blitz, Wolf is telling lawmakers and everyone who will listen that the HTC program has successfully transform older cities and towns in the Ocean State, by spurring reinvestment, revitalization, and job generation. These programs provide an incentive in the form of a tax credit, to property owners to renovate old historic buildings. These state credits can be and often are paired with the federal historic preservation tax credit to renovate commercial properties.

Historic Tax Credit – Great Economic Development Tool

It’s a success in the Ocean State, too, notes Wolfe. Rhode Island’s HTC program has stimulated more than $1.6 billion of investment in more than 250 projects within less than 7 years. For every dollar the state invests, there is a more than five dollar return in economic activity based on a study Wolf’s organization, Grow Smart Rhode Island, commissioned several years ago.

Wolf adds, “The evidence that the historic tax credit makes a real positive difference can be seen on the ground in communities throughout the state – in bustling commercial properties like Hope Artiste Village in Pawtucket and along Westminster Street in Providence, in new apartments for urban workers and new affordable housing units. It can be seen in increased property tax revenues from rehabbed buildings. It can be seen in neighborhoods that have been rescued from the blight of vacant, derelict buildings.”

According to a media release issued jointly by Grow Smart Rhode Island and Preserve Rhode Island, $52 million in bond authorization remains in reserve from the total bond authorization approved in 2008 by the General Assembly for the original HTC program, which was discontinued in 2008 for any new projects but maintained for many other projects already under way at that time.

The General Assembly in 2013 reinstated the program, using $34.5 million in unclaimed tax credits from the prior program and, Wolf says, “The new program has ignited 26 new projects that will pump nearly $180 million into the Rhode Island economy, but 27 additional projects are waitlisted and in jeopardy if additional funding is not provided to sustain the program. By not including an extension of historic tax credit funding in the upcoming budget, the state risks forgoing up to $160 million in construction activity alone. Significant sales and employment taxes also will be lost.”

Preserve Rhode Island Executive Director Valerie Talmage says, “Our Historic Tax Credit program has an outstanding track record. From 2002 to 2008, it generated $1.3 billion in new private investment in Rhode Island’s real-estate economy, which resulted in 22,000 construction jobs, 6,000 permanent jobs, and total wages of more than $800 million. Our state cannot afford to shut this program down.”

Wolf added that suspending the HTC program again would be harmful because “We’d be ceding the competitive advantage provided by our world-renowned collection of distinctive historic buildings and neighborhoods to nearby states such as Connecticut, Massachusetts, Maine, and New York, each of which has ongoing and robust state historic tax credit programs.”

Finally, Wolf emphasized that another HTC program suspension would “Send a bad signal to investors and entrepreneurs about Rhode Island’s business climate and economic development credibility.”

Wolf and Talmage, together with their organization members, partners, and fellow advocates are calling on the General Assembly to “Continue the Historic Tax Credit program because it is a sound and critical investment in Rhode Island’s cities and towns and a proven job-generator and revenue producer, which our state sorely needs.”

In their lobbying Wolf, Talmage and their network of approximately 90 organizations who support the HTC program are quick to identify its positive impact. State officials will see higher state revenues through construction and other jobs generated by the HTC projects. In addition, job creation and increased employment taxes are derived years in advance of any outlay of state funding because Historic Tax Credits are not released for any enrolled project until the project is completed. Sales-tax revenues result from construction materials and other goods purchased for HTC projects also benefit the state in advance of any outlay.

Wolf and others also note that The Budget Office forecasts no fiscal impact to the state budget from the proposed $52 Million in debt service until FY ’19 because bonds won’t need to be issued until the projects have been completed and the tax credits have been claimed.

In an Op Ed in the Providence Journal, Pawtucket’s Mayor Donald R. Grebien and Central Fall’s Mayor James Diossa, support Wolf’s assessment of its impact in the state’s cities and towns. The Mayors say that their fiscally stressed communities benefit from Historic Tax Credits through increased property assessments.

Developing an Old Mill in Pawtucket

Antique Dealer and entrepreneur Scott Davis knows a good program when he sees one. The Eastside resident is planning to develop his old Fuller manufacturing mill on Exchange Street into a combination of commercial and residential space, but any state backpedaling of funding the HTC program will make it difficult to get his project off the ground.

An inquiry by Davis to Chairman Raymond Gallison of the House Committee on Finance, about the suspending of funding for HTC program resulted in an email explaining the decision. The chairman noted that a primary reason for rejecting Governor Chafee’s proposed additional $52 million HTC funding was based on the assertion that there were already sufficient funds in place in the existing program to meet current demand.

Davis disagrees. “My project, which is a rare and historically significant wooden mill built in a prominent Pawtucket city location alongside the Blackstone River is Number 65 in the queue,” he says, noting that he believes that none of the current funds in place will ever be allocated to his project.

“Financial assistance is essentially the only way that my mill project will ever be able to developed, says Davis, who notes that the cost to restore the historic structure versus the prevailing rental rate for space in Pawtucket simply doesn’t work out.

Chairman Gallison also noted that issues with tax credit brokers are a stumbling block for the program,” says Davis. “It is unimaginable that the resulting (legislative) decision] would be akin to ‘throwing out the baby with the bathwater”. If there is a problem with the brokers, Davis calls on lawmakers to fix it, but threatening so many important buildings, jobs, and resulting tax revenues in the process just doesn’t make sense to him.

Davis says that previous HTC funds have made 8 major Pawtucket projects possible. According to the Pawtucket Foundation, the tax incentives were the catalyst for $150 million in local investments that increased property values by 728 % and increased Pawtucket tax revenues by over $1 million annually.

“Keeping these historic buildings intact while awaiting funding assistance is extremely expensive and no doubt we will lose many of them if we can’t save them promptly,” predicts Davis. “ I can tell you from personal experience that just keeping my small 26,000 sq. ft. mill ‘on hold’ costs me several thousand dollars per month just for taxes, insurance, utilities, fire safety, security and basic upkeep,” he says.

HTC is No 38 Studios

Some speculate that recent headlines about 38 Studios and tax credits in general may have spooked House and Senate Leadership to back away from funding the HTC program. Ultimately, the ball is in the court of Senate leadership who must respond to the budget proposal submitted by the House. How can lawmakers fear another 38 Studio debacle when the Historic Tax Credits are only issued upon completion of the project? In other words, after construction workers have laid the last brick – only after new residential and office space is actually available.

But, Gregg Paré, the Rhode Island’s Director of Communication, says don’t expect any action in the Senate to fund the state’s HTC program this year if the House fails to act. “The Senate is in agreement on the budget with the House,” he says, noting that Senate leadership usually iron out any differences before the budget reaches the House floor.

Paré says that the Senate has only once modified the House budget proposal in decades. But, now it’s time for this legislative action to happen again this year especially if the House budget does not include funding for the HTC program.

To Wolf, Talmage, and Davis, and to municipal leaders in a number of Rhode Island’s cities and towns, it is obvious that the program works and serves as an important tool for community revitalization and economic development.

For this columnist, funding the HTC program is just the right thing to do, for the economy and most importantly, for the tax payer.
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Herb Weiss is a writer covering health care, aging, medical issues and the economy. He can be reached at hweissri@aol.com.

Lawmakers to Consider Funding for Vaccine Immunizations for Seniors

Published in Pawtucket Times on May 12, 2003

Even with a state budget deficit looming, sometimes putting a little money into a statewide initiative can ultimately save big dollars.  It’s just the right thing to do.

For the second year, the Ocean State Adult Immunization Coalition (OSAIC) has approached the Rhode Island General Assembly for funding to promote the group’s efforts to get the word out about the importance of Rhode Island seniors  getting influenza and pneumococcal vaccinations.

OSAIC’s message is quite simple: “Avoid a Hospital Stay: Get Your Flu Shot Now!”

According to OSAIC, pneumonia and influenza deaths together are considered the six-leading cause of death in the nation.

Since 1999, there have been 300 deaths and 6,800 hospitalizations that were attributed to influenza and pneumococcal disease in the Ocean State.

OSAIC said vaccinations are a cost-effective way to prevent these unnecessary hospitalizations and deaths.

OSAIC, a coalition of 40 agencies, including hospitals, nursing facilities, vaccine manufacturers, medical societies, managed care groups, the Rhode Island Department of Health, Rhode Island Quality Partners, the Visiting Nurses Association, and Blue Cross Blue Shield of Rhode Island, call on Gov. Don Carcieri and lawmakers to see the big picture – preventative medicine care can ultimately save tax dollars.

Anne Marie Beadsworth, OSAIC’s chair, said the cost of a flu shot is $ 15 and a pneumonia shot is $ 30.

On the other hand, she added that the average length of stay for an older person with influenza is five days, costing $ 12,000.

Since OSAIC was established in 1997, Beadsworth has seen a steady progress in the coalition’s efforts to get more older Rhode Islanders immunized to prevent the influenza and pneumonia.

“The immunization coverage rates for those age 65 and over has increased by eight precent (from 67 percent to 75 percent) for influenza vaccine and 24 percent (from 43 percent to 67 percent) for pneumococcal vaccine,” she noted.

Beadsworth said OSAIC is working to reach the Healthy People 2010 goal of a 90 percent immunization rate for influenza and pneumococcal  for people age 65 and over.

“Through promotional efforts in five languages in 2002, more than 350 flu clinics were conducted throughout Rhode Island with the guarantee that any person age 65 and older, regardless of insurance status, could get a flu shot without any out-of-pocket expenses,” she said.

Furthermore, OSAIC’s gains have propelled the Rhode Island-based initiative into top 10 standings in the United States, says Beadsworth.

“We rank number seven for both flu and pneumococcal vaccination rates,” she added.

Beadsworth said that during last year’s legislative session, OSAIC’s efforts for the state funding fizzled because of state funding fizzled because of state budget cuts. The coalition was just not effective in getting its message out to lawmakers, she added.

During this year’s legislative session, OSAIC is pushing for $ 103,169 in new funding in Fiscal Year 2003-2004 to expand the coalition’s educational outreach efforts and to hire a part-time staffer to oversee its ongoing programs to improve the state’s immunization rates.

Currently, OSAIC is a volunteer-driven organization with its $ 50,000 working budget coming from member organizations and from the community.

It seems things may be different this year at the Rhode Island General Assembly. Support among lawmakers is growing for OSAIC’s ongoing preventative medicine initiatives.

“Quite a few advocates are coming to the Senate asking for funding,” said Sen. Stephen D. Alves (D-West Warwick), who said there is now growing support for OSAIC’s funding request.

Alves, who serves as chair in the Senate Finance Committee, told All About Seniors the funding request will be brought up during the chamber’s budget debates.

“Everyday, we talk about preventative medicine – funding this program is a step in the right direction,” said Alves.

Rep. Steven M. Costantino (D-Providence), who sits on the House Finance Committee, told me he sees the value of OSAIC’s efforts, too, and plans to call for funding OSAIC’s initiative during House budget deliberations.

Health Director Patricia A. Nolan also sees the positive benefits of OSAIC’s prevention campaign.

“Adults need their shots, too – especially people aged 50 and older or people with chronic health conditions. Vaccinations are one of the easiest and most effective ways to stay healthy,” she says.

As state revenue estimators meet to determine the breath and scope of the state’s budget deficit, Gov. Carcieri’s staff continue their ‘Big Audit” to identify ways to save taxpayer dollars.

When the dust settles, even with a projected budget deficit, it may be time for the governor and the General Assembly to view preventative medicine as a worthy cost containment approach for reining in skyrocketing health care costs. Even though state dollars have to be allocated up front, large savings might be realized down the road.

As the state’s final budget is being crated, we must not be “penny wise but pound foolish” when determining what bills live or die in the 2004 legislation hopper. Taxpayers will ultimately lose if this happens.

Lawmakers Consider Proposals to Reduce Costs of Prescription Drugs

Published in the Pawtucket Times on April 15, 2002

Amid the political bickering over the separation of powers bill and the controversy over allowing Rhode Islanders to vote next November on bringing gambling to the Ocean State, the Rhode Island General Assembly is getting around to considering three legislative proposals with broad public and bipartisan political support.

In the shadow of a huge state budget deficit, bills strongly endorsed by both senior and disabled advocates, would make pharmaceutical costs affordable while not costing the state one penny.

It was standing room only last Wednesday in Room 35 at a House Finance Committee hearing, chaired by Chairman Steven Costantino (D-Providence), of the subcommittee on human services. The legislative hearing, lasting almost four hours, drew the attention of the Rhode Island Commission on Aging, the Forum on Aging, the Gray Panthers, and Choices, to name a few.

Dozens of aging and disability advocacy groups, staffers of the Department of Elderly Affairs and the Department of Human Services, and lobbyists for the powerful pharmaceutical industry came to listen to testimony that would officially kick of the state’s debate on lowering pharmaceutical costs for seniors and persons with disabilities.

Under on legislative proposals (H 7291/S 2729), the state Department of Human Services would seek a waiver from the federal government allowing Rhode Island to use Medicaid funding to pay for prescription drugs for low-income seniors with incomes of up to $ 17,720 and couples with incomes up to  $ 23,880.

This bill, authored by Lt. Gov. Charles Fogarty and sponsored by Rep. Constantino and House Finance Chairman Gordon Fox, would enroll approximately 90 percent of the 37,500 seniors now enrolled in the Pharmaceutical Assistance for the Elderly Program (RIPAE) – the state’s pharmaceutical program. Because these seniors would now quality for prescription drug coverage under Medicaid, all Food and Drug Administration (FDA) drugs would be covered, not just those currently covered under RIPAE. Seniors would likely pay small co-payments, probably less than $ 10, rather than the 40 percent co-payments currently charged.

At this hearing, testimony was gathered on two other Fogarty legislative proposals that would make prescription drugs  more affordable to seniors and persons with disabilities who are not covered by the waiver. One bill (H 7290) would allow seniors enrolled in the RIPAE – approximately 5,000 seniors – to buy prescription drugs not currently covered by RIPAE at the discounted state price.

The second (H 7524) would allow 4,300 low-income persons on Social Security Disability Income (SSDI) who are between ages 55 and 65 to become members of RIPAE and purchase prescription medications at the state discounted rate.

Under both of these legislative proposals, the state would be able to obtain the manufacturer’s rebate available through RIPAE. Rebate funds gained from drug purchases by persons in the new SSDI part of RIPAE would accrue in a special fund to be used to subsidized the cost of these drugs in the future. This legislative initiative, like the other two, would be of no cost to the state.

There’s a very good reason why these proposals should be enacted, says Fogarty, who chairs the state’s Long-Term Care Coordinating Council. “Far too many of our seniors still face great burdens in paying for their medications. If your income is less than $ 10,000 per year – which is the median income for a person on RIPAE – having to pay $ 1,000 or more out of pocket for one’s prescription is a big problem.

“This year, in spite of our budget woes, we have a tremendous opportunity to greatly expand our prescription assistance program for seniors and persons with disabilities. By taking advantage of federal Medicaid dollars, we can save seniors millions and we can do these expansions with no added costs to the state,” Fogarty adds.

Susan Sweet, who represents CHOICES, a home and community advocacy agency and the Rhode Island Minority Elderly Task Force, says the expansion of RIPAE is critical, especially in light of the federal government’s failure to create a federal Medicare pharmaceutical benefit.

“Being able to pay for prescriptions avoids sickness, unnecessary hospitalizations and admissions to nursing homes, saving millions of dollars and many years of productive lives for seniors,” says Sweet. “Pharmaceutical products are the current and future medical miracles, and health insurance is inadequate without adequate drug cover, she says.

Shirley Kaiser, president of the Rhode Island Gray Panthers, whose group has battled years for putting the brakes on rising pharmaceutical costs, says seniors are giddy with the news that Rhode Island may finally move to addressing the problem.

The Gray Panthers strongly endorse the legislative proposals, and she believes this is the year for enactment of a legislative remedy.

At the Rhode Island General Assembly, some bills are enacted while many die during the legislative process, even those with great merit.

In light of the state’s fiscal uncertainties, lawmakers now have a rare opportunity to assist older Rhode Islanders and persons with disabilities in obtaining affordable prescription drugs at no cost to the state coffers.

With the widespread support and endorsement of these legislative proposals from state officials, aging and disability advocacy groups, and the pharmaceutical industry, for me it’s a no brainer – pass these bills and quickly sign them into law, says Kaiser.

It is now time to put this longtime aging issue behind us and move forward to other pressing matters like creating and paying for a seamless long-term care system.

Ensure passage of the three bills by telling your representatives and senators how important these three proposals are for you, and request their passage.