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Rep. Shekarchi: Cities, Towns Should Share Any State Budget Surplus

1/22/2015

Difficult economic times affect not only the state as a whole but every city and town and every resident living in them. “Red ink is not limited only to state government,” said Rep. K. Joseph Shekarchi (D-Dist. 23, Warwick). “Difficult budget decisions, making cuts to important programs get headlines when they happen at the State House, but those are issues being felt and addressed by communities across Rhode Island, as well.”

With the General Assembly and all state leaders focused on ways to improve the overall economy and address the state’s struggling business climate, Representative Shekarchi is confident better days are ahead and surpluses will replace years of dealing with budget deficits.

When that happens, Representative Shekarchi wants 50 percent of any surplus to go to cities and towns.

“I feel that any time the state has the opportunity to do so, it must help municipalities as they continue to struggle with their own budget concerns,” said Representative Shekarchi. “When we see better days, we need to share that growth with our municipalities, which have been suffering through these tough fiscal times right alongside the state. If things get better financially, every city and town should get a little relief.”

Representative Shekarchi has again this year introduced legislation requiring that 50 percent of any surplus be distributed to cities and towns and that the municipalities use those funds only to pay for unfunded liabilities, bond debt or pension programs. “This will help upgrade city and town bond ratings, savings taxpayers even more in the long run.”

The other 50 percent would be deposited in the state’s general fund.

“I believe this money should go back to cities and towns, but I also believe it should not be used for new goods or personnel,” said Representative Shekarchi. “We all know it’s too easy to spend extra money, when there is any, on ‘other’ things that aren’t necessary instead of using it wisely. Our communities are struggling financially largely because of unfunded or under-funded liabilities, such as pension plans, and every extra dollar that can be used to address that fiscal situation should be.”

The 50 percent of any surplus that would go to municipalities, under the Shekarchi legislation, would be distributed under the current aid to cities and towns formula.

The legislation (2015-H 5140) has been referred to the House Committee on Finance. Co-sponsors include Rep. Joseph J. Solomon Jr. (D-Dist. 22, Warwick), Rep. Stephen M. Casey (D-Dist. 50, Woonsocket), Rep. Doreen Marie Costa (R-Dist. 31, North Kingstown, Exeter) and Rep. Michael J. Marcello (D-Dist. 41, Scituate, Cranston).

Representative Shekarchi, who is serving his second term in the House of Representatives, is the chairman of the House Committee on Labor.

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