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6/17/2024
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Following General Assembly passage, 2025 state budget bill signed into law
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 STATE HOUSE – Following General Assembly passage early Friday, the 2025 state budget bill was signed into law today. The $13.963 billion budget directs additional funding toward education and children, raises Medicaid reimbursement rates and includes a $120 million affordable housing bond.
“Through this budget, we are emphasizing education at every level and supporting children. This budget is the result of a truly collaborative process between my colleagues in the House, the dedicated members of the House Finance Committee, our partners in the Senate and Governor McKee and his team to carefully create a plan that meets Rhode Island’s needs for education, students and children first, while addressing our challenges, such as housing and health care,” said Speaker K. Joseph Shekarchi (D-Dist. 23, Warwick).
Said President of the Senate Ruggerio (D-Dist. 4, North Providence, Providence), “This is a responsible budget resulting from a truly collaborative process among the Senate, House and the Governor’s office. In addition to our partners in the House and the Governor’s office, I particularly want to thank Senate Finance Committee Chairman Lou DiPalma, and all the members of the Finance Committee, who spent countless hours reviewing all aspects of the budget over the past several months, as well as all of my colleagues in the Senate for their input. I am pleased that the budget will invest in many Senate priorities, particularly in the areas of health care, child care, education and providing some needed relief to retirees.”
The budget was the result of months of hearings and collaborative efforts between the House, the Senate, the governor’s office and state agencies, as well as advocacy and input from community leaders and the public.
“This budget is responsible and forward thinking, and it is based on facts and data without putting undue burdens upon the taxpayers. It meets the needs of today with an eye on Rhode Island’s future by heavily investing in education and health care. The budget corrects long-standing issues with provider reimbursement rates, which in turn, will not only support our population’s well-being and health, but it will also help uplift the dedicated workers who care for us all. It also addresses our retirees who have been struggling for many years and I am proud of this legislation that will serve all of Rhode Island’s residents well,” said Senate Finance Committee Chairman Louis P. DiPalma (D-Dist. 12, Middletown, Little Compton, Newport, Tiverton).
Said House Finance Committee Chairman Marvin L. Abney (D-Dist. 73, Newport, Middletown), “This year’s budget proposal reflects the fact that while the influx of federal pandemic funding has come to an end, Rhode Island is still on sound financial footing and we have continued to best position Rhode Island for future economic possibilities. This budget takes care of and supports our residents, families and children without putting any additional financial burdens on the people of Rhode Island, many of whom are struggling due to the higher costs of daily life we are now seeing. I thank Speaker Shekarchi, President Ruggerio, Governor McKee, Chairman DiPalma and my colleagues on the House Finance Committee for their countless hours of thoughtful and comprehensive work that created the budget document you see today. Tough, but responsible and fair, choices were made, and I firmly believe this budget will further the progress Rhode Island has made over the past few years.”
Flanked by lawmakers, Gov. Daniel McKee signed the budget bill into law today in a State House ceremony.
“We came together as a team and delivered a budget that continues to put Rhode Island on a path to improve educational outcomes, raise incomes for all Rhode Islanders, and build a healthier state,” said Governor McKee. “I am proud to sign a budget that makes smart investments in Rhode Island’s future and I thank the Speaker and Senate President for their collaboration.”
Under the spending plan approved by the Assembly (2024-H 7225Aaa), schools will receive a $70.9 million increase in state aid, $33.8 million more than originally sought by Governor McKee, to help
schools and students still reeling from the effects of the pandemic.
The Assembly made more modest increases for multi-language learners (MLL), the governor’s Learn365RI initiative for out-of-school learning, and efforts to boost reading and math achievement, than the governor had sought, but those efforts will still get a boost over the current year. Currently MLL students get 15% extra over the core education aid; it will increase to 20% and be incorporated directly into the education funding formula. Learn365RI will get $5 million, and there will be $5 million more for reading and math achievement.
The Assembly fully funded an $813,000 proposal by the governor to provide free breakfast and lunch to the 6,500 students statewide who currently receive reduced-price school meals, and provide them a monthly $40 benefit for three months in the summer.
The budget provides an additional $1 million in operating supports for Community College of Rhode Island and $2 million for University of Rhode Island, and continues both the Rhode Island Promise and the Hope scholarship programs, which provide two years of free tuition to Rhode Islanders at CCRI and Rhode Island College, respectively. The bill authorizes a two-year extension of the Hope scholarship program. It also covers with general revenue $2.3 million for the dual and concurrent enrollment initiative, which allows high schoolers to earn college credits without costs. Federal funds for the program have expired.
One of the four bond questions that would go before voters in November would fund two major facilities at URI and RIC. The first is $87 million to build a state-of-the-art Biomedical Sciences Building at the Kingston campus of the University of Rhode Island. The governor had planned to ask voters to approve $80 million, but lawmakers added $7 million to fully fund the project as a means to bolster both URI and the life sciences industry in Rhode Island through increased research infrastructure.
That bond would also provide $73 million to fully fund renovation of Whipple Hall at RIC to house the new Institute for Cybersecurity and Emerging Technologies.
The plan continues the Assembly’s robust support of college campus improvements. URI, RIC and CCRI would see numerous campus improvement projects, many funded partly through state Capital Plan funds.
Legislators added an additional $20 million to the governor’s proposal for a bond question on the November ballot to support more affordable housing creation, bringing the total to $120 million, the largest housing bond in the state’s history. The bond would provide $80 million for affordable housing, $20 million for acquisition and revitalization, $10 million for homeownership programs, $5 million for site acquisition, $4 million or housing-related infrastructure and $1 million for municipal planning.
Additionally, the bill authorizes using up to $10 million from the housing bond for public housing. Earlier this year the Department of Housing contracted a six-month study of public developer models, such as one in Montgomery County, Md., that develops buildings that house families of varying income levels through a public revolving fund.
The Assembly included over $160 million from all sources to fully fund the plan recommended by the Office of the Health Insurance Commissioner to raise Medicaid reimbursement rates next year, rather than over three years as the governor had proposed. That includes $3.8 million for Early Intervention providers.
The Assembly included a proposal by the governor to redirect $10 million in unspent federal COVID funding to nursing homes.
The proposal adds $30.6 million to the governor’s request of $30.3 million to fund pending increases to support providers contracted by the Department of Children, Youth and Families.
The Assembly included a new program, to be run through the state Treasurer’s office, to use $1 million of general revenue to purchase medical debts of struggling Rhode Islanders.
Recipients of Rhode Island Works, the state’s cash assistance and work-readiness program for low-income children and their families, will get a 20% raise in cash benefits and higher income disregards, and children will no longer lose their benefits if their parents are sanctioned. Lawmakers have instituted raises over the last several years, following a 30-year period without a single rate increase.
The Assembly increased eligibility for child care supports, raised the rates of center-based providers and extended the child care for child care providers pilot program for an additional year.
The plan allocates $83.6 million for the state match for federal funds for the reconstruction of the shuttered westbound Washington Bridge that brings I-195 over the Seekonk River between Providence and East Providence.
The plan also doubled the amount of assistance for businesses hurt by the closure of the bridge, from $1.3 million proposed by the governor to $2.6 million.
The Assembly increased a proposal to direct $5 million of unspent federal ARPA funds for an existing municipal grant program for construction of roads, sidewalks and bridges, adding $2 million.
The Assembly plan adds another $5 million to the $10 million the governor proposed to help the Rhode Island Public Transit Authority close a $18.1 million budget gap following the end of federal pandemic aid. The agency has announced that the extra funding is enough to ward off any service reductions in the coming year.
The plan offers good news for many retirees: it includes a proposal to raise the exemption on certain pension plans and annuities income from $20,000 to $50,000 for qualified single filers, $100,000 for joint filers.
It also repeals the suspension of full annual cost of living adjustments (COLAs) for state employees who retired before 2012, when the state’s pension reforms took effect. This benefit restoration will give a small boost to their pensions, which will be most meaningful for those who make the least. For people who retired after July 1, 2012, the threshold for the COLA to be returned will be changed from when the pension fund is 80% funded to when it is 75% funded.
It also changes the calculation for pension benefits to base it on the highest three consecutive years of earning instead of five.
The Assembly added open space programs to the “green bond” to appear on November’s ballot: $5 million for farmland protection, $5 million to the Department of Environmental Management’s open space program and $3 million to DEM’s Division of Agriculture and Forest Environment to fund forest and habitat management on state property. The Assembly reduced some of the bond’s allocation for work at the Port of Davisville, as well as funding to repair Newport’s Cliff Walk that has now been awarded from federal funds, keeping the bond to $53 million even with the open space additions.
The Assembly added a new $10 million bond referendum to support arts infrastructure in Rhode Island, including $6 million for specific “shovel ready” projects at Trinity Repertory Company, the Tomaquag Museum and Newport Contemporary Ballet.
The Assembly kept intact a proposal to hike the cigarette tax by 25 cents per pack, and amended a proposal to institute a new tax on electronic nicotine delivery systems to create a two-tiered system similar to Connecticut’s structure.
Not included was funding for a new state archives and museum, for lack of an identified site for the building or any partner organizations to help carry out the proposal. The governor’s original budget proposal included a $60 million bond that would be put before voters, but the project was estimated to cost more than $100 million.
For more information, contact:
Meredyth R. Whitty, Publicist
State House Room 20
Providence, RI 02903
(401) 222-1923
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