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Time for RI General Assembly to watch the money

July 20, 2012

Looking for a no-brainer issue for Rhode Island General Assembly candidates this fall? RIPR political analyst Scott MacKay has one that should resonate with taxpayers.

Even in the middle of a glorious summer, the ocean sometimes just doesn’t compensate for living in the Ocean State. This has become a season of both electioneering and discontent.

Our state’s economy is in the dumpster. As our New England neighbors are recovering from the recession, Rhode Island remains the region’s only state with an unemployment rate that remains stubbornly above the national figure.

On the heels of the disastrous bankruptcy of Curt Schilling’s 38 Studios video game company comes word that Capco Steel, a local construction firm, is behind on a $6 million loan financed through an Economic Development Corporation subsidiary. All this on top of the disclosures about the Institute for International Sport at the University of Rhode Island, which squandered hundreds of thousands of taxpayer dollars handed out as legislative grants.

It’s past time that the Smith Hill crowd, and especially the Assembly leadership, got serious about injecting accountability into the way your government spends its money.

Few things raise the hackles of Rhode Islanders than the knowledge that their tax money is being frittered away on deals for the politically-connected.

In the case of 38 Studios, the leader of the political pack was former Gov. Donald Carcieri, who posed as a small government Republican but steered the deal that dropped $75 million in taxpayer-backed loans into the 38 Studios deal. Carcieri may have had stars in his eyes after rubbing elbows with World Series star Curt Schilling, but he wasn’t alone among state politicians involved in this farce. The $75 million loan would not have gone forward without approval from the Rhode Island House and Senate. The same applies to the CAPCO loan, except that at least it was given to a home-grown Rhode Island company with a successful track record.

And then there is the Institute for International Sport.…another waste of taxpayer dollars.  (Some fine reporting on this issue has been done by the Providence  Journal’s Katherine Gregg and Tom Mooney). The issue here didn’t involve EDC; rather it was financed largely by direct grants from the Assembly under a program that is now controlled by Speaker Gordon Fox and Senate President Teresa Paiva Weed.

The saddest part of all this is that the General Assembly, which appropriates the money, has nothing much to do after the photo-ops and news conferences are over. Money cascades out the door of the State House and lawmakers don’t seem to know where it is going. This leaves a bitter taste in the mouths of taxpayers, who conclude that lawmakers don’t care how their money gets spent so long as it lands in the hands of   the favored few who write the campaign checks.

So here’s an issue taxpayers can rally around…oversight of General Assembly spending.

The legislature needs to establish standing committees on government oversight to ensure that tax money is being spent prudently. Perhaps a state inspector general would be in order here; Rep. Larry Valencia has proposed such an office in recent years but it hasn’t gone anywhere. Maybe lawmakers don’t want an independent inspector looking over their shoulders.

Another change would be to limit legislative grants to say $5,000 tops, so that no one institution, such as the sports institute, could game the system for hundreds of thousands of dollars. These grants should be restricted to local charities, such as Meals on Wheels for the elderly or sports leagues for the young.

And lawmakers must change the focus of  EDC Grants to reward success. Investing state money directly into companies, a la 38 Studios and Capco, doesn’t work. Let’s go back to the future. During the 1990s, then-Gov. Lincoln Almond and Assembly leaders worked together to use targeted tax breaks to bring such successful businesses to Rhode Island as Fidelity Investments and the Providence Place Mall. Neither project got direct taxpayer money. Both are still doing well and providing several thousand jobs to a state that desperately needs them.

If  you’re wondering why the Assembly can appropriate gobs of your money with scant accountability, well, look in the mirror. For too long Rhode Islanders have elected and re-elected lawmakers who go up to Smith Hill and go along to get along. (Half of us don’t even bother to cast ballots). This year, when the pols are asking for your vote, maybe you ought to ask: Why does so much of our money go out the State House door without any real oversight. And what do they plan to do about it? In this election season, we all have to remember that politicians rarely see the light until they feel the heat.

Scott MacKay’s commentary   can be heard every Monday at 6:45 and 8:45 on Morning Edition. You can also follow his political reporting and analysis at the `On Politics’ blog at

3 Comments leave one →
  1. July 23, 2012 10:54 am

    Spot on!

  2. Monique permalink
    July 23, 2012 4:03 pm

    Awesome column, Scott.

  3. July 24, 2012 8:18 pm

    Thanks much. State House misses Mr. Gorham and dad too!

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