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Nesi’s Notes: Dec. 16

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Happy Saturday! Here’s another edition of my weekend column for WPRI.com – as always, send your takes, tips and trial balloons to tnesi@wpri.com and follow @tednesi on Twitter.

1. Rhode Islanders should soon have a better sense of what the future holds for the state’s second-largest hospital group, Care New England. The parent of Women & Infants, Kent, Butler and Memorial says its finances are stabilizing, and it remains committed to a takeover plan that would see Memorial close and the other hospitals become part of Massachusetts giant Partners HealthCare. While the Partners deal has been public since April, the next move seems to be getting closer: a Partners exec says they will decide in the next two months whether to go through with the deal, and officials from the Massachusetts system were in town this week to tour the Care New England facilities. An exclusivity agreement barring Care New England from talking to any other suitors expires Dec. 31, though a spokesman said it could be renewed to keep the process on track. Meanwhile, Brown and Prospect Medical Holdings are still discussing whether to announce their own alternative bid for Care New England. Looking ahead, one thing to keep an eye on is whether the politics of hospital mergers becomes an issue in next year’s election. Partners’ expansion plans have been a hot potato in Massachusetts before, and Lt. Gov. Dan McKee for one has already suggested it would be a mistake to let the CNE hospitals fall into Bay State hands, fearing local expertise would be siphoned off to Boston.

2. Employment statistics – the unemployment rate, job growth – get most of the attention in discussions of the economy. But it’s not the only important number to keep an eye on. Another is Rhode Island residents’ total personal income, as tracked by the biennial Revenue Estimating Conference. And a look at the conference reports over the last few years shows income growth is seriously missing expectations from earlier in the economic recovery. Back in November 2014, the conference projected Rhode Islanders’ personal income would total $59.8 billion this year and $61.8 billion next year. Fast-forward to last month, and the conference’s revised income forecast is far more modest: only $54.4 billion this year and $56.3 billion next year. Put another way, Rhode Islanders’ personal income in 2018 is now expected to be nearly 10% lower than forecast three years ago. That’s billions of dollars less in Rhode Islanders’ pockets than officials had thought would be there. It’s also a major contrast with the forecasts for payrolls (only about 1% lower now than was expected three years ago) or the unemployment rate (roughly a percentage point better now than was expected three years ago).

3. Rhode Island isn’t alone in its budget struggles. The Rockefeller Institute reported Friday that state and local tax revenue has “fluctuated wildly over the last four years” nationwide, with revenue declines more common east of the Mississippi during the first half of this year. And via The Boston Globe’s Jon Chesto, Beacon Hill policymakers got their own warning this week from the respected Massachusetts Taxpayers Foundation, urging them to “batten down the hatches” for the next 18 months. “Massachusetts is unprepared for any significant disruption to its economy and finances,” the group warned. Some of their concerns are Massachusetts-specific, notably three ballot measures with fiscal implications. But others are relevant to Rhode Island, including the federal tax bill. “It is more likely than not that investors will realign their investments based on this new certainty, resulting in a one-time surge in capital gains tax revenue in tax year 2018,” the foundation says; at the same time, spending cuts to pay for the bill could mean less federal funding over time. Also mirroring Rhode Island: “Massachusetts has a daunting workforce hurdle that will increasingly hinder economic growth. The number of Massachusetts residents between the ages of 16 and 64 peaked in June 2015 and will continue to decline over the next decade, limiting growth as businesses struggle to recruit workers. … Relatedly, the number of Massachusetts residents age 65 and older began to soar in 2011. As people transition from work to retirement, income and sales tax revenues will decline while the cost of health care and other government services for this aging population will climb.”

4. One of Governor Raimondo’s most influential aides may not be in her office much longer. David Cruise, the former state senator and Traffic Tribunal magistrate, confirmed Friday he’s considering leaving his job as her senior adviser. “Nothing’s firmed up yet,” Cruise said. “I’m thinking about it.” He said he expects to make a decision in the next week or two.

5. Joe Trillo’s newly announced independent bid has given a bit of a jolt to the race for governor. Trillo has lobbed a fair amount of criticism at Republican frontrunner Allan Fung since making his announcement last week, and in a television interview last weekend went so far as to describe his opponents as “pansies.” Fung has been limiting his public profile since his kickoff, focusing on fundraising and behind-the-scenes organizing, but in the wake of Trillo’s comments he made the rounds on talk radio, giving interviews to John DePetro and Tara Granahan. (“What are we, back in grade school? That doesn’t even dignify a comment,” Fung said of Trillo, while also renewing his critique of Governor Raimondo.) There was also an interesting development on the other side of the political spectrum: longtime teacher’s union chief Bob Walsh hinted on this week’s “Lively Experiment” that he could mount his own independent bid for governor next fall. Walsh – or another candidate to Raimondo’s left – could seek to emulate the 2010 victory of then-independent Lincoln Chafee, whose campaign Walsh was heavily involved in. All this, and the election is still 325 days away.

6. Lt. Gov. Dan McKee isn’t happy with the local – and national – narrative about his Democratic primary race against progressive challenger Rep. Aaron Regunberg. “I would put a timeout on that thinking,” McKee said on this week’s Newsmakers (literally making the timeout hand signal). “National attention on this campaign should put antennas up all over the state,” he said. “That a national group is going to try and do some sort of a takeover of the Democratic Party in the state of Rhode Island. … That scenario that’s being built, that somehow this is … a SandersClinton rematch? No. This is not a Sanders-Clinton rematch.” McKee described himself as “a JFK/McKee Democrat,” and cited multiple times when he’s not been on the same page as the institutional Rhode Island Democratic Party, including his early support for Barack Obama in 2007 and the fact that he was not the endorsed party candidate for his current office in 2014.

7. The Rhode Island Democratic Party has yet another internal split on its hands, this time after members of the increasingly active Women’s Caucus said they were told to leave party HQ Thursday evening while conducting interviews for their executive board. This follows two other controversies in recent weeks: the fight over Joe DeLorenzo that ended with his resignation, and a harshly criticized statement the party sent trying to link Allan Fung with his former police chief after the latter was charged with domestic violence. Outside the party, the Rhode Island Progressive Democrats made news this week when they sent candidates a detailed questionnaire testing their positions on issues including a $15 minimum wage, abortion rights and single-payer health care. Candidates are also being asked to pledge that they won’t vote to keep Nick Mattiello and Dominick Ruggerio as legislative leaders – an ask that could cause headaches for Democratic incumbents. The Progressive Dems’ Nate Carpenter says candidate responses won’t be released to the public, however, and will be used by the group’s executive board heading into next year’s elections.

8. Oy, Tannenbaum.

9. Our weekly dispatch from WPRI.com’s Dan McGowan: “How did Providence get to a point where 72 school employees were placed on administrative leave in just 64 days of school? Although city officials have pointed to guidance they received from the R.I. Department of Children, Youth and Families as the culprit, it really goes back to the school department’s handling of an incident involving an elementary school physical education teacher who allegedly molested several children last school year. School officials got the most important part of that case right. They removed the teacher from the school immediately. After that, there are a lot of questions. Numerous people were aware of the allegations, but none of them called DCYF. Students were interviewed without parents or police present. In a sworn affidavit, a detective said he only learned about the claims when a parent came to the police department. Then the school principal was the only person charged with failing to report the claims to DCYF, which rubbed a lot of teachers and administrators the wrong way. By the time the new school year started, everyone was on edge. One elementary school went into lockdown on the first day for a minor issue. Calls from schools to the police increased. And when DCYF decided it wanted to investigate all incidents prior to any school investigations, district leaders interpreted that to mean employees should be placed on leave until they were cleared of wrongdoing. What was already a volatile environment became toxic. Teachers started accusing students of making false allegations, and at least two have recanted their claims. Superintendent Chris Maher says he’ll personally review every case to determine whether employees need to be taken out of school while DCYF investigates them. That might slow down the leaves. But now he’s got a task that has dogged too many school chiefs over the years: improving morale.”

10. Who is targeting state Rep. Anastasia Williams? A flyer was recently circulated in her Providence district by a group calling itself the “Coalition to Wash, Clean, and Shine,” advocating the veteran Democrat’s defeat. “We are prepared to challenge A. Williams in the next election,” it says. “She must go. We are asking you to stand up and just vote against the self-promoting, poor leadership, political cronyism, bad attitude, and foul mouth, that has entrenched her political career.” It’s unclear who is behind the flyer. Asked about it, Williams said in an email: “As a public servant and in life, I will encounter challenges. With my solid foundation of integrity, courage and loyalty, I will continue to advocate and represent the best interest of all people in our state, especially the underrepresented and community of color.”

11. House Minority Leader Patricia Morgan has hired a new spokesperson for the Republican caucus: Joseph Golomboski, who comes to the House GOP from nearly five years as a senior customer-service rep at Bank of America. He has also served on the board of the Rhode Island Tea Party since 2012, and before that reports he led the Johnston Tea Party for about five years. (His efforts to raise money for Parkinson’s research have made news, too.) Golomboski takes over from Raina Smith.

12. Is online gambling coming to Rhode Island? The Projo raised the possibility earlier this week, and Senate Finance Chairman Bill Conley confirmed on this week’s Newsmakers the idea is being closely examined by Senate President Dominick Ruggerio and his aides. The option could be on the table within months, depending on the outcome of a U.S. Supreme Court case. “I think that when the decision comes down, we’ll be ready to look at legislation right away,” Conley said. “So it wouldn’t be impossible – although the legislative tray usually takes two or three years to mature, it wouldn’t be impossible to get a piece of legislation through this session if the Supreme Court rules that the states have the ability to do it.”

13. Susan Campbell continues to track the fallout from UHIP. The latest bug involves residents being told they or their loved ones are dead when they’re not. She also filed an update on the UHIP special master’s first report. Safe to say, when I filed my first story on UHIP back in September 2015 I never would have guessed it would wind up as Rhode Island’s 2017 Story of the Year.

14. Unsurprisingly, all four Democrats in Rhode Island’s congressional delegation condemned the FCC’s vote this week to repeal the net neutrality rules put in place in 2015. But while the FCC vote came down along party lines, local reaction did not – Republican Bobby Nardolillo, who is challenging Sheldon Whitehouse for U.S. Senate, also came out in opposition to the change. “While, I most certainly oppose burdensome regulations, these rules maintain a fair and equal access to all,” Nardolillo tweeted.

15. Another Republican challenger – Sal Caiozzo, who is running against Democratic Congressman Jim Langevin – is trying to catch fire with a potential sleeper issue, the plight of commercial fishermen. In a statement this week, Caiozzo argued “destructive over-regulation” is hammering the fishing industry, and criticized Langevin for giving them only “tepid support.” Langevin’s spokeswoman argued the charge is unfair, citing a new $1.6 million federal grant for the Port of Galilee, a letter objecting to proposed regulations opposed by local squid fishermen, and his plans to reintroduce a bill that would give Rhode Island two spots on the Mid-Atlantic Fisheries Management Council. Caiozzo isn’t the only one trying to draw attention to the issue. Bobby Nardolillo had signs supporting commercial fishermen at his kickoff event, and New Bedford Mayor Jon Mitchell was in D.C. last week advocating for them. CommonWealth Magazine also suggested the recent tragedy involving the Misty Blue can be partly traced back to growing federal regulation of fishing boats.

16. Design is an important competitive advantage for Providence, thanks in no small part to its status as home of the world’s leading design school, and this week’s Executive Suite offered a serendipitous reminder of that. The two guests we had booked did not seem to have anything in common – Dr. Peter Snyder of the New England Medical Innovation Center and Ellen McNulty-Brown of the high-end handbag maker Lotuff Leather. But in the course of their interviews, both mentioned the importance of RISD to their relatively young enterprises. Snyder said his group – a new partnership involving RISD, Lifespan, URI, Ximedica and other organizations aimed at spurring research collaboration and commercialization – is hoping the school’s expertise in “human- and user-centric design” could help differentiate Providence from what he sees as a heavy-engineering focus in Cambridge. McNulty-Brown – whose fast-growing company has been featured in The New York Times and The Wall Street Journal in recent weeks – said Lotuff decided to set up shop in Providence in 2012 partly to take advantage of the pipeline of artisans and craftspersons coming out of RISD; the company’s creative director is a graduate.

17. The New England Medical Innovation Center – NEMIC for short – has support from the I-195 Redevelopment District Commission and the Commerce Corporation as it gets off the ground. The commission is providing NEMIC up to $600,000 to renovate an initial office at 1 Ship Street, where Johnson & Johnson’s temporary headquarters is. More interesting may be the $150,000 Network Matching Grant the organization recently received from Commerce, because it’s tied to NEMIC’s participation in the Korean Institute of Startup & Entrepreneurship Development’s Global Accelerating Program. As NEMIC’s Peter Snyder explained it on Executive Suite, the collaboration came about thanks to Lydia Shin, who has connections in the Seoul-based biotech startup scene. Starting in March, NEMIC will be bringing eight South Korean companies to Providence for a one-month residency to get them up to speed about how the medical industry works in the U.S. Over time, Snyder said, they hope to bring more companies from South Korea to Providence for as long as a year, and build deeper connections between the two places. “In a year’s time, with the amount of integration that you can foster into our community, the likelihood that they would stay grows,” he argued. “The longer they’re here, the more connections they make.”

18. An ex-Facebook exec says social media is “ripping apart” society.

19. An ominous economic warning from AEI’s Desmond Lachman.

20. “Is anyone ever wrong anymore?”

21. How to play the horse whinny in “Sleigh Ride.”

22. Set your DVRs: This week on Newsmakers – Lt. Gov. Dan McKee; Senate Finance Committee Chairman William Conley. This week on Executive Suite – Dr. Peter Snyder, founder/managing partner, New England Medical Innovation Center; Lotuff Leather CEO Ellen McNulty-Brown. Watch Saturday at 10:30 p.m. or Sunday at 8 p.m. on myRITV (or Sunday at 6 a.m. on Fox). Catch both shows back-to-back on your radio Sundays at 6 p.m. on WPRO-AM 630 and WEAN-FM 99.7. And you can subscribe to both shows as iTunes podcasts – click here for Executive Suite and click here for Newsmakers. See you back here next Saturday morning.Ted Nesi (tnesi@wpri.com) covers politics and the economy for WPRI.com. He writes Nesi’s Notes on Saturdays and hosts Executive Suite. Follow him on Twitter and Facebook

Copyright 2020 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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