Stimulus money debate to renew

PROVIDENCE, R.I. (AP) - State lawmakers in the General Assembly will be on recess this week, but their rest from the state’s budget crisis will be short.

A $787 billion stimulus plan approved by Congress is certain to re-ignite a fierce debate at the Statehouse over who controls the estimated $1 billion allocated for Rhode Island and whether cities and towns will still have to absorb big funding cuts to balance the state’s budget.

Rhode Island faces a $357 million budget deficit for the year ending in June and a similar shortfall in the coming year. To help balance the state’s books, Republican Gov. Don Carcieri has proposed cutting nearly $75 million in state funding to cities and towns.

Warwick Mayor Scott Avedisian said he hopes the influx of funding prompts Carcieri and lawmakers to reconsider their options. Avedisian could lose 6 percent of his municipal budget to Carcieri’s proposed cuts and a drop-off in local property tax revenue caused by the recession.

“I hope (the governor) will allay some of the cuts he’s put forth,” Avedisian said.

If not, Warwick may cancel its summer recreation programs for children and forgo lifeguards at town beaches. The city is already seeking concessions from its workers’ unions that Avedisian said he hopes will save money and prevent layoffs.

The stimulus debate in Washington seemed to create budget paralysis in Rhode Island.

Carcieri introduced a revised budget in January designed to close the deficit, but lawmakers in the Democratic-dominated General Assembly are still debating it even as Carcieri urges them to act quickly.

Carcieri delayed the deadline for submitting his budget for the next fiscal year until Feb. 24 so he can incorporate the stimulus funding heading for Rhode Island. In his annual State of the State speech last week, Carcieri said he wants to use the federal money to close the budget deficits, reduce taxes and stimulate the economy.

Political leaders were still sorting out last week who must approve the release of stimulus funds in Rhode Island. On Tuesday, Carcieri signed an executive order creating the Office of Economic Recovery and Reinvestment, which will recommend which infrastructure projects should be funded with stimulus money. The office will be led by Beverly Najarian, Carcieri’s deputy chief of staff.

Under the plan, Carcieri would then decide whether to accept or reject the recommendations. Carcieri spokeswoman Amy Kempe said it was unclear whether legislative approval would be required.

Democratic leaders in the General Assembly believe lawmakers must approve the use of all funds that come into the state, said Larry Berman, a spokesman for House Speaker William Murphy.

President Barack Obama dedicated part of the stimulus package to funding infrastructure projects in the hope it will generate spending and create jobs. While Carcieri’s administration was still assembling its wish list of projects last week, the state Department of Transportation has identified about $132 million in infrastructure work, said Michael Lewis, director of the state Department of Transportation.

Lewis expected to start advertising those projects to contractors as early as this week.

“Our effort is to get as much work out into the field as quickly as possible,” he said.