Senate committee approves RI budget

PROVIDENCE, R.I. (WPRI) - A Senate committee has approved a $7.8 billion budget plan that attempts to close a massive deficit opened by a deep recession.

The Senate Finance Committee voted Thursday to approve the budget proposal, which tries to eliminate a shortfall by raising state taxes on investment income and gasoline. If the full Senate approves the plan, it will head to Gov. Donald Carcieri.

The House approved it early Thursday morning. Legislative leaders in the Democratic-dominated General Assembly have said the proposal attempts to maintain key social service programs while unemployment soars past 12 percent.

If passed, the plan would also slash funding to cities and towns. Lawmakers hope the proposal will help close the state’s $590 million deficit.

Providence mayor David Cicilline believes the plan will raise property taxes.

“It is a radical departure to say that that would be eliminated in its entirety,” Carcieri said. “It is impossible to imagine that we can absorb an elimination of general revenue sharing and cut in education aid and avoid an increase in property taxes.”

The governor has not said whether or not he will veto the proposal.

“To put us in a sustainable position going forward, we’ve got to get the spending at the local level under control because we’re spending more money in the 39 cities and towns than we are at the state,” Carcieri said.

Democrats hold a veto-proof majority in the General Assembly.

(Copyright 2009 by The Associated Press. All Rights Reserved.)