Mayor Elorza’s $734M budget includes more school funding, municipal ID cards

Dan McGowan

PROVIDENCE, R.I. (WPRI) – Providence Mayor Jorge Elorza proposed a budget Wednesday that holds the line on all taxes, but still follows through on his pledge to boost city funding for the school department for the first time in seven years.

The Democratic mayor’s $734-million tax-and-spending plan for the fiscal year that starts July 1 also includes funding for new police and fire academies, pay raises for most city workers and $150,000 for a municipal identification card program similar to existing ones in New York City, Detroit and New Haven.

Under the mayor’s proposal, Providence’s owner-occupied property tax rate would remain $18.77 per $1,000 of assessed value, with the non-owner-occupied rate also staying put at $31.91 per $1,000. The city’s commercial tax rate will be $36.65 per $1,000, and car taxes will remain $60 per $1,000 with a $2,000 exemption. There are also no fee increases – like parking meters or tickets – but the city is expanding its traffic camera infraction program to several school zones.

Setting aside time in his speech before the City Council to criticize President Trump for laying out “an agenda that conflicts deeply with our principles and cuts support for the most vulnerable communities,” Elorza described his third budget proposal as “an expression of our values and a statement about who we are as a city.”

“This is a pro-growth, forward-thinking budget that invests in our future,” Elorza said. “It is a progressive budget that supports our most vulnerable. It is an innovation-based budget that pushes us to do better. And most of all, it is a ‘One Providence’ budget that invests in bringing communities together.”

On education, the mayor is proposing a $3.65-million increase, to bring the city’s contribution to the school department to $128.5 million. The district is also anticipating $241.7 million in state aid through the education funding formula.

The extra funding will support hiring more staff to improve outcomes at seven city middle schools, a newcomer school for refugees and recent immigrants, and expected raises for teachers and administrators. The city budget also includes $500,000 for the highly regarded Providence Talks program for young children, as well as five new recreation camps, more Chromebooks for students and a consultant to craft an infrastructure plan for the district’s crumbling school buildings.

“There is no better contribution we can make to our society than to support the education of our children,” Elorza said. “Our responsibility to our children’s education begins long before they enter kindergarten and extends far after they leave high school.”

Aside from earmarking raises for Providence teachers – whose union contract expires Aug. 31 – the mayor’s budget includes small, contractually-mandated pay increases for police officers, firefighters, school clerical workers and members of Local 1033, the municipal employees union. The budget also factors in a 2.75% raise for non-union employees – like Elorza’s staff – although officials say those raises are not guaranteed.

City officials say they’re committed to providing municipal ID cards for individuals in the country illegally or those who do not otherwise have driver’s licenses or state IDs. Elorza said the program, which will not be mandatory and will come with a minimal fee, is designed to function similar to programs all over the country.

“Whether you’re an immigrant who’s looking for a way to legally identify yourself, you’re homeless and don’t have the means, you’re transgender and want to self-identify, you’re a young person who wants your first bank account, or you’re a resident who wants to display your Providence pride, this helps bring us together,” Elorza said.

The mayor is also proposing a six-week paid family leave program, beginning with non-union employees who have worked for the city for at least a year. The anticipated price tag is only $13,000 because employees would be required to expend all but one week of their accrued sick and vacation time before taking advantage of the program. Officials say they are hopeful they can expand the program to union workers, but the benefit must be negotiated in future contracts.

For public safety, the budget includes funding for 40 additional police officers on top of the current 57-member academy. The police department is currently functioning with 396 police officers, well below the nearly 500 allowed by city ordinance. The city is also planning an 80-member firefighter academy that will begin in June as well as another 70-member academy next June, paid for using a $15-million federal grant the city secured last year. There are currently 335 firefighters.

Aside from new police hires, the budget sets aside $370,000 for additional staff, training and technology associated with the Community Safety Act (CSA), a far-reaching police profiling ordinance expected to win final City Council approval Thursday. The budget also calls for $317,000 to fund the Providence External Review Authority, a nine-member panel appointed by the mayor and the council that the CSA would empower.

On the fire side, the budget does not include any funding for a potential settlement in an ongoing dispute over overtime payments between the union and the Elorza administration. Providence’s internal auditor has estimated the cost could exceed $10 million, but a spokesperson for the mayor said city officials “don’t concede we are liable.”

When it comes to state aid, the mayor’s budget is identical to the proposal put forth by Gov. Gina Raimondo earlier this year. Aside from state education money, the city is expecting $74 million in state aid, which includes payments in lieu of taxes from nonprofits, distressed-community relief funding, state library aid and reimbursements for the car tax and school infrastructure as well as a share of taxes on public service corporations, hotels and meals and beverages.

The budget builds in a $3.5-million surplus, which would give the city reserves in its general fund – a safeguard commonly known as a rainy day fund – for the first time since 2012. The city had $22 million in reserves in 2008, but those funds were rapidly drawn down after massive cuts in state aid and the economic downturn.

When it comes to long-term liabilities, the city is setting aside $75 million for its actuarially-required pension contribution and $31.4 million for retiree health care. When combined with $65.1 million in other debt service, approximately 23% of the entire budget is dedicated toward former employees and paying off money borrowed for projects that are already complete.

As of June 30, 2016, Providence’s pension system was just 25.28% funded, with an unfunded liability of $985 million, according to an audit released earlier this year. The fund paid out $108.1 million to retirees during the year, about $17.8 million more than it took in from employee contributions and investment income.

The mayor’s proposal budget will now head to the City Council Finance Committee, which will vet the plan over the next six weeks. The committee and the full council tends to approve a budget by the middle of June.

Continue the discussion on FacebookDan McGowan ( ) covers politics, education and the city of Providence for Follow him on Facebook and Twitter: @danmcgowan

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