PROVIDENCE, R.I. (WPRI) — Rhode Island legislative leaders released draft legislation Wednesday laying out how the state will spend an initial round of federal American Rescue Plan Act money, giving Gov. Dan McKee’s administration more specific direction on its uses.
McKee, House Speaker Joe Shekarchi and Senate President Dominick Ruggerio announced a deal last week to use $119 million of the state’s $1.1 billion allocation from ARPA’s State Fiscal Recovery Fund. It’s the first time the state has touched the much-discussed pot of federal money, which Congress approved last spring.
The House and Senate Finance Committees are scheduled to vote on the ARPA spending bill Thursday, with final votes expected in early January.
The revised bill is four pages, compared with the two-page initial draft put forward by the governor in October — reflecting the addition of more expansive language around how the federal cash should be spent and how it will be overseen.
“We’ve tried to do two things,” Senate Finance Committee Chairman Ryan Pearson told reporters. “Bucket out the money better around what exactly it’s going to be used for and put some controls on it. But then also, really use levers that we can through legislation to drive the executive action that we need to implement and execute, obviously, a little bit faster than we’ve been seeing.”
Pearson emphasized that Rhode Island is receiving a total of over $2.6 billion from the Rescue Plan Act, and said lawmakers already appropriated $1.4 billion of that money in this year’s state budget. But many of those funds are designated for specific uses, unlike the $1.1 billion.
Following McKee’s initial outline, the revised ARPA bill allocates funds across three categories of programs: $45 million on business and tourism; $38.5 million on services for children; and $29.5 million on housing and broadband. The revised bill also adds an additional $6 million for child care.
“I think the Senate really viewed child care as a key portion of not only a strong social-safety-net program but also a program that will allow us to [ease] some of the labor market pressures that we’re seeing,” said Pearson, D-Cumberland.
Lawmakers agreed with the governor on providing $32 million to the R.I. Commerce Corp. to assist small businesses.
The revised bill breaks that down as $12.5 million for direct payments to businesses that have lost revenue due to the pandemic; $10.5 million for technical assistance to support “long-term business capacity building”; and $7.5 million for capital improvements to support public health and outdoor activities. Another $1.5 million is provided for administrative costs.
Under the revised bill language, only small businesses with less than $1 million in annual gross revenue and direct impacts from COVID-19 will be eligible for the program. Grants from each of the three types of awards are capped at $10,000, with an individual business eligible to receive up to $20,000 between the three. At least 20% of the money must go to minority business enterprises, or MBEs.
“All of our colleagues are really cognizant around wanting to make sure we’re assisting small businesses that are truly in need,” Pearson said, saying legislators “tried to tailor” the new Commerce program to achieve that goal.
Lawmakers agreed to provide $15 million for Rhode Island Housing to develop affordable housing, as requested by the governor. They added a requirement that the money must be used as part of a plan they previously directed the administration to put together for the newly created Housing Production Fund, reflecting frustration in the General Assembly about the slow rollout of that effort.
“The issues have not always been around lack of dollars, but lack of ability to execute fast enough,” Pearson said.
Rhode Island Housing will also receive $12 million to acquire property for redevelopment as affordable or supportive housing, plus $1.5 million “for grants to providers to expand housing navigation, stabilization, and mental health services.” The chief of the R.I. Office of Housing and Community Development will be required to send lawmakers a monthly status report on how the latter money is being spent.
(Separately, McKee has scheduled a news conference for Thursday morning “to announce additional immediate measures to address homelessness and provide shelter for Rhode Island families and individuals.”)
The revised bill divvies up the governor’s request for $13 million to support the tourism, hospitality and events industries as $8 million for direct payments; $3 million for capital improvements to support public health and outdoor activities; and $2 million for tourism marketing in conjunction with the state’s tourism agencies and the R.I. Airport Corporation.
The $500,000 for broadband is broken out as $100,000 to hire a state broadband director at the Commerce Corp.; $200,000 to develop a statewide plan to increase broadband access for unserved and underserved communities; and $200,000 to map broadband access across Rhode Island.
There is $13 million for the Executive Office of Health and Human Services, as sought by McKee, with $7.5 million for pediatric providers in the form of stabilization grants and incentives for developmental and psychosocial behavioral screening, plus $5.5 million for the Early Intervention program.
The $12.5 million that the governor requested for the Department of Children, Youth and Families is specifically allocated to fund $700 monthly wage stipends for care staff, as well as $750 hiring incentives. Workers will be eligible if they make less than $75,000 a year. DCYF must send lawmakers a status report on the money every 60 days starting Jan. 15.
McKee’s request for $12.7 million to increase pay for child care workers was raised to $18.7 million, with lawmakers specifying that the money should be used for $1,500 twice-a-year retention bonuses.
In addition to the $119 million in ARPA spending authorized under the bill released Wednesday, the governor and legislative leaders previously announced that he would be allocating an additional $61 million for care workers and the Early Intervention program through other federal funding sources.
As for the roughly $1 billion that is still unspent from the ARPA State Fiscal Recovery Fund pot, Pearson said he expects lawmakers to examine how to use it in the new year. He said he prefers allocating it on a separate track from the regular annual state budget, which is slated to be introduced in January and is usually voted on by June, and he expects health and human services to be a top priority for the money.
Ted Nesi (firstname.lastname@example.org) 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