2023 -- H 6222

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LC002615

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2023

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A N   A C T

RELATING TO TOWNS AND CITIES -- STATE AID

     Introduced By: Representatives Cortvriend, and McGaw

     Date Introduced: March 29, 2023

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. The general assembly makes the following findings of fact:

     (1) Cities and town across Rhode Island have been struggling with the recent inflationary

environment;

     (2) In 2009, the general assembly discontinued revenue sharing due to the economic

collapse;

     (3) The removal of general revenue sharing forced the cities and towns to increase property

taxes to make up for this loss in revenue;

     (4) The State of Rhode has seen a very strong rebound from the economic crisis brought

on by the COVID pandemic;

     (5) During the past two (2) fiscal years, the State of Rhode Island has benefitted from the

economic rebound with $417 and $878 million surpluses, respectively, and an anticipated $600

million surplus for FY 2023;

     (6) Reinstating general revenue sharing for all thirty-nine (39) cities and towns will help

reduce the impact of inflation on the citizens of Rhode Island; and

     (7) Restoring thirty-nine million dollars ($39,000,000) of general revenue sharing to cities

and towns based on the 2020 census would result in the following allocation and distribution:

     City 2020 Census Total Payment

     Barrington 17153 $ 600,355

     Bristol 22493 $ 787,255

     Burrillville 16158 $ 565,530

     Central Falls 22583 $ 790,405

     Charlestown 7997 $ 279,895

     Coventry 35688 $ 1,249,080

     Cranston 82934 $ 2,902,690

     Cumberland 36405 $ 1,274,175

     East Greenwich 14312 $ 500,920

     East Providence 47139 $ 1,649,865

     Exeter 6460 $ 226,100

     Foster 4469 $ 156,415

     Glocester 9974 $ 349,090

     Hopkinton 8398 $ 293,930

     Jamestown 5559 $ 194,565

     Johnston 29568 $ 1,034,880

     Lincoln 22529 $ 788,515

     Little Compton 3616 $ 126,560

     Middletown 17075 $ 597,625

     Narragansett 14532 $ 508,620

     New Shoreham 1410 $ 49,350

     Newport 25163 $ 880,705

     North Kingstown 27732 $ 970,620

     North Providence 34114 $ 1,193,990

     North Smithfield 12588 $ 440,580

     Pawtucket 75604 $ 2,646,140

     Portsmouth 17871 $ 625,485

     Providence 190934 $ 6,682,690

     Richmond 8020 $ 280,700

     Scituate 10384 $ 363,440

     Smithfield 22118 $ 774,130

     South Kingstown 31931 $ 1,117,585

     Tiverton 16359 $ 572,565

     Warren 11147 $ 390,145

     Warwick 82823 $ 2,898,805

     West Greenwich 6528 $ 228,480

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     West Warwick 31012 $ 1,085,420

     Westerly 23359 $ 817,565

     Woonsocket 43240 $ 1,513,400

      1097379 $ 38,408,265

     SECTION 2. Section 45-13-1 of the General Laws in Chapter 45-13 entitled "State Aid" is

hereby amended to read as follows:

     45-13-1. Apportionment of annual appropriation for state aid.

     (a) As used in this chapter, the following words and terms have the following meanings:

     (1) “Income” means the most recent estimate of per-capita income for a city, town or

county as reported by the United States Department of Commerce, Bureau of the Census.

     (2) “Population” means the most recent estimates of population for each city and town as

reported by the United States Department of Commerce, Bureau of the Census.

     (3) “Reference year” means the second fiscal year preceding the beginning of the fiscal

year in which the distribution of state aid to cities and towns is made provided however that the

reference year for distributions made in fiscal year 2007-2008 shall be the third fiscal year

preceding the beginning of the fiscal year 2007-2008 and provided further that the reference year

for distributions made in fiscal year 2008-2009 shall be the fourth fiscal year preceding the

beginning of the fiscal year 2008-2009.

     (4) “Tax effort” means the total taxes imposed by a city or town for public purposes or the

totals of those taxes for the cities or towns within a county (except employee and employer

assessments and contributions to finance retirement and social insurance systems and other special

assessments for capital outlay) determined by the United States Secretary of Commerce for general

statistical purposes and adjusted to exclude amounts properly allocated to education expenses.

     (b) Aid to cities and towns shall be apportioned as follows: For each county, city or town,

let R be the tax effort divided by the square of per capita income, i.e., R = (tax effort)/(income x

income).

     The amount to be allocated to the counties shall be apportioned in the ratio of the value of

R for each county divided by the sum of the values of R for all five (5) counties.

     The amount to be allocated for all cities and for all towns within a county shall be the

allocation for that county apportioned proportionally to the total tax effort of the towns and cities

in that county.

     The amount to be allocated to any city or town is the amount allocated to all cities or all

towns within the county apportioned in the ratio of the value of R for that city (or town) divided by

the sum of the values of R for all cities (or all towns) in that county; provided, further, that no city

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or town shall receive an entitlement in excess of one hundred forty-five percent (145%) of that city

or town’s population multiplied by the average per capita statewide amount of the annual

appropriation for state aid to cities and towns. Any excess entitlement shall be allocated to the

remainder of the cities and towns in the respective county in accordance with the provisions of this

section.

     For fiscal year 2004, notwithstanding the provisions of subsection (a), aid calculations shall

be based on a blended rate of ninety percent (90%) of the data from the 1990 census and ten percent

(10%) of the data from the 2000 census. In each of the succeeding nine (9) fiscal years, the

calculations shall be based on a blended rate that increases the percentage of data utilized from the

2000 census by ten percent (10%) from the previous year and decreases the percentage of the data

utilized from the 1990 census by ten percent (10%) from the previous year.

     (c) The total amount of aid to be apportioned pursuant to subsection (b) above shall be

specified in the annual appropriation act of the state and shall be equal to the following:

     (1) For fiscal years ending June 30, 1994 through June 30, 1998, the total amount of aid

shall be based upon one percent (1%) of total state tax revenues in the reference year.

     (2) For the fiscal year ending June 30, 1999, the total amount of aid shall be based upon

one and three-tenths percent (1.3%) of total state tax revenues in the reference year.

     (3) For the fiscal year ending June 30, 2000, the total amount of aid shall be based upon

one and seven-tenths percent (1.7%) of total state tax revenues in the reference year.

     (4) For the fiscal year ending June 30, 2001, the total amount of aid shall be based upon

two percent (2.0%) of total state tax revenues in the reference year.

     (5) For the fiscal year ending June 30, 2002, the total amount of aid shall be based upon

two and four-tenths percent (2.4%) of total state tax revenues in the reference year.

     (6) For the fiscal year ending June 30, 2003, the total amount of aid shall be based upon

two and four-tenths percent (2.4%) of total state tax revenues in the reference year.

     (7) For the fiscal year ending June 30, 2004, the total amount of aid shall be based upon

two and seven-tenths percent (2.7%) of total state tax revenues in the reference year.

     (8) For the fiscal year ending June 30, 2005, the total amount of aid shall be fifty-two

million four hundred thirty-eight thousand five hundred thirty-two dollars ($52,438,532).

     (9) For the fiscal year ending June 30, 2006, the total amount of aid shall be based upon

three percent (3%) of total state tax revenues in the reference year.

     (10) For the fiscal year ending June 30, 2007 the total amount of aid shall be sixty-four

million six hundred ninety-nine thousand three dollars ($64,699,003).

     (11) For the fiscal year ending June 30, 2008, the total amount of aid shall be sixty-four

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million six hundred ninety-nine thousand three dollars ($64,699,003).

     (12) [Deleted by P.L. 2009, ch. 68, art. 6, section 3.]

     (13) [Deleted by P.L. 2007, ch. 73, art. 25, section 1.]

     (14) [Deleted by P.L. 2007, ch. 73, art. 25, section 1.]

     (d) For the fiscal year ending June 30, 2008 the apportionments of state aid as derived

through the calculations as required by subsections (a) through (c) of this section shall be adjusted

downward statewide by ten million dollars ($10,000,000).

     (e) For the fiscal year ending June 30, 2009, the total amount of aid shall be twenty-five

million dollars ($25,000,000) with such distribution allocated proportionately on the same basis as

the original enactment of general revenue sharing of FY 2009.

     (f) For the fiscal year ending June 30, 2009 and thereafter, funding shall be determined by

appropriation.

     (g) For the fiscal year ending June 30, 2024, the total amount of aid shall be thirty-nine

million dollars ($39,000,000) to be allocated and distributed based on population as determined by

the 2020 census.

     (h) For the fiscal year ending June 30, 2025 and thereafter, aid shall be increased by the

total percentage increase in the Consumer Price Index for all Urban Consumers (CPI-U).

     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TOWNS AND CITIES -- STATE AID

***

     This act would provide state aid to municipalities in the amount of thirty-nine million

dollars ($39,000,000) based on population and increased annually by the increase in the consumer

price index (CPI).

     This act would take effect upon passage.

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