PROVIDENCE, R.I. (WPRI) — Rhode Island leaders are swimming in money these days.
In a report issued Monday, state budget officer Joe Codega said the state is on track to finish its 2021-22 fiscal year with a surplus of $618 million when the books close next June — a massive amount of extra money compared with prior recent Novembers.
The projection is based on actual spending from July through September plus newly updated forecasts for revenue and social services.
Codga’s report indicates that the state ended the last fiscal year with a surplus of $549 million. That was thanks in part to nearly $217 million in pandemic-related reimbursements expected from the Federal Emergency Management Agency (FEMA).
That half-billion-dollar surplus for last year is the foundation of the big surplus seen in the current budget year, since the extra money carries over. Tax revenue is also coming in considerably higher than projected back in May.
The surplus forecast takes no account of the $1.1 billion in unspent funds from the American Rescue Plan Act’s State Fiscal Recovery Fund that Rhode Island is currently sitting on, as well as billions of federal dollars expected to arrive in the coming years from the infrastructure bill President Biden signed Monday.
Codega’s quarterly budget report also ticked off a number of specific items of note.
The state’s child care program is expected to need $13 million less than appropriated by lawmakers when they enacted the current budget last spring because enrollment is only 6,272, compared with the 7,420 originally projected. The cost per subsidy is also lower than anticipated.
The Biden administration has also further extended its temporary enhanced match for the Medicaid health insurance program due to the pandemic. The federal government is currently picking up over 60% of Rhode Island’s Medicaid costs, compared with about 54% to 55% under normal circumstances.
There is also ongoing uncertainty about Medicaid billing for the state-run Eleanor Slater Hospital, which has been struggling with federal compliance issues in recent years. The budget report said state officials are still seeking federal reimbursement for “a significant portion” of Eleanor Slater costs in 2019-20 and 2020-21, as well as in the current year, which could put more money back in state coffers.
Gov. Dan McKee is due to submit his budget proposal for the 2022-23 fiscal year — which starts July 1 of next year — in January. Lawmakers will then hold hearings on the proposal during the winter and spring, with a final budget plan usually enacted during the month of June.
Ted Nesi (email@example.com) is a Target 12 investigative reporter and 12 News politics/business editor. He co-hosts Newsmakers and writes Nesi’s Notes on Saturdays. Connect with him on Twitter and Facebook