Emily Leayman

Rhode Island ‘Waste-O-Meter’ Reveals $6.9 Mil in Wasteful Spending

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Posted by Emily Leayman on Thursday, January 28th, 2016, 11:20 AM PERMALINK

For Rhode Island being the smallest state, it packs on the unnecessary spending. Cue Rhode Island’s new “Waste-O-Meter.”

Republican legislators uncovered a whopping $6,967,000 in alleged wasteful government spending in just 10 instances, with help from Providence Journal investigations.

"They report findings and citizens fume about the waste,” state. Rep. Patricia Morgan (R) said about the revelations. “After a few days, the frustration dies down and the people of Rhode Island continue with their busy lives, forgetting about the latest assault to their wallets. Those in charge are not held responsible for the waste and so it continues, without corrective action, no one is held accountable."

One of the bigger culprits in wasteful spending is the Rhode Island Department of Transportation.

The atrocities include:

-$3.1 million in reimbursements to the Federal Highway Administration for DOT for not meeting quality standards for Route 195 construction.

-$750,000 that the state paid to a Wickford Junction shopping center to settle a breach of contract lawsuit. The Providence Journal called it “a few more dollars to the cost of Rhode Island's underutilized Wickford Junction train station.”

-$195,000 in salaries for three DOT employees paid during a five-and-a-half month leave.

$383,000 “and counting” in salaries DOT paid to staff transferred to other agencies

-$381,000 in uncollected overpayments to the Cardi Corporation and D’Ambra Contruction that DOT recently reimbursed the Federal Highway Administration for.

-$154,000 for consultants to discuss alternatives to barriers on the I-Way bridge in 2013. The bridge used temporary barriers after a crash revealed the railings were not properly installed and could potentially allow large vehicles to break through and fall into the river.

-$1.3 million in “unnecessary overtime”

-$360,000 in “newly invested positions”

There’s a good chance more wasteful spending is lurking in the shadows. For that purpose the lawmakers have created a hotline and email address for the public to contact.

But the story of taxpayers’ woes does not end there.

Rhode Islanders pay a 7 percent sales tax, more than 1 percent over the national average (5.95 percent) and the third highest cigarette tax at $3.50.

Worst of all, they fork out the 11th highest money at the pump, paying a 33-cent gas tax. Now taxpayers know a good chunk of that money is being sent into oblivion by their friends at the Rhode Island DOT.

If the state was more transparent on how it spends the budget, more officials could be held accountable for these instances of government waste.

But surely the tiny state with not-so-tiny taxes could break the record of $6.9 mil in wasteful spending. That total could just be the beginning of wasteful spending, the Republican lawmakers hint. 


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Meanwhile, in the States...

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Posted by Emily Leayman on Friday, January 22nd, 2016, 11:36 AM PERMALINK

While there is gridlock on the tax front in Washington, there are many developments in state capitals across the country that affect taxpayers. 

Below is a roundup of state tax activity from this past week:

Arizona: Arizona lawmaker wants cap on corporate tax credits for tuition donations. Bill proposes a tax credit for concealed carry permits.

California: Department of Transportation considers replacing gas tax with mileage fees. Gov. Brown asks for health care tax while GOP, unions fight for higher funding for disabled.

Delaware: Delaware House approves corporate income tax changes.

Florida: Florida House in support of Gov. Scott’s $1 million in tax cuts. Legislature seeks to end the corruption tax.

Idaho: Lawmakers doubting whether Gov. Otter’s budget includes tax cuts.

Illinois: Hospital property tax exemptions on hold after court action.

Indiana: House committee approves gas, cigarette tax hikes for road funding.

Iowa: $10 million biochemical tax credit plan unveiled in Iowa Senate.

Kansas: Kansas loses tax revenue from grocery shopping out of state.

Kentucky: State Senate president predicts tight budget.

Maine: Legislature tries to reverse $3 million in taxes on veterans.

Maryland: Gov. Hogan (R) clashes with Democrats on how to spend state surplus.

Michigan: Republicans introduce sales tax increase for road funding.

Mississippi: State sees rapid decrease in sales tax revenue.

Missouri: Gov. Nixon (D) proposes $600 million in new spending in state of state address.

Ohio: Ohio law sets out uniform municipal income-tax rules. School districts bill the state for lost money going to charter schools.

Pennsylvania: State Senate passes temporary bill to keep prisons open.

South Dakota: Revenue Department asks for state bank tax changes. Lawmakers support giving a portion of alcohol tax revenue to courts and jails.

Tennessee: New program finds $60 million in unreported retail taxes.

Utah: Proposed legislation would scrap movie-making tax credits in Utah. Democrat proposes barring higher education from receiving income tax revenue.

Virginia: A pending real estate tax would pay for new interstate.

West Virginia: Legislators promise to address road repairs. 


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WV Governor Tomblin Pushes for Tax Hikes in 2016 Budget

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Posted by Emily Leayman on Friday, January 15th, 2016, 5:13 PM PERMALINK

In his sixth and final State of the State address Jan. 13, Gov. Earl Ray Tomblin (D-W.Va.) proposed tax increases as a solution to a $350 million budget shortfall.

But before mentioning the 2017 budget, he touts all of his tax-friendly accomplishments:

On tax cuts:

We’ve enacted gradual reductions in our business and consumer taxes, and since I took office, we’ve saved employers and West Virginians more than $225 million.”

On state rankings:

We rank higher than each of our neighboring states in this year’s Business Tax Climate Index. Companies are noticing these changes, and they are paying off in big ways in regions across the state.”

On the budget:

“In spite of those challenges, we are paying not only our current bills, but keeping every financial commitment of the past, paying down our debts in workers’ compensation, teachers’ retirement and public employees’ retirement. And we’ve done that without a single tax increase, while reducing tax burdens on West Virginia families and those doing business here by hundreds of millions of dollars.”

West Virginians may see at least one more tax cut under Tomblin’s plan to pay off workers’ compensation debt.

He noted:

“By accelerating this final payment, we can remove additional severance taxes on our coal and natural gas industries, providing much-needed relief to help them invest in our state and employ West Virginia workers.”

But that does not cancel out a new tax and a tax increase. He proposes:

“As we work to find new ways to ensure our tax base is both stable and more diverse, we must also seriously consider new revenue opportunities. Tonight, I am introducing legislation to increase our state’s tobacco tax by 45 cents a pack to a total of one dollar.”

This tax increase would generate $71.5 million in revenue annually.

He also suggested eliminating the sales tax exemption for cell phone and phone line usage, which could rake in $60 million annually:

“Once adopted, this legislation will place the same 6 percent sales tax on cell phone and phone line usage – putting us in step with what is done in the vast majority of other states.”

He tries to justify his way of compensating for the state’s overspending problem:

“With these proposed changes – and despite low severance tax projections – the 2017 budget I present to you tonight uses no money, no money from our Rainy Day Fund and does not include any across-the-board budget cuts beyond those already in place. In spite of the tight budget years of the past, our new six-year budget forecast shows surpluses of nearly $7 million in 2019, $89 million in 2020 and $118 million in 2021.”

But Republican House leaders aren’t as willing to increase taxes.

State House Speaker Tim Armstead said House members support spending cuts, not raising taxes. House Majority Leader Daryl Cowles said that lawmakers from border counties could be hesitant, as consumers could go to Virginia. Virginia’s 30 cents-per-pack tax would drastically differ from West Virginia’s proposed $1.

“Virginia’s awful close to home,” said Cowles. “There’s not much of an appetite to raise taxes. We should streamline government.”

West Virginia is ranked 21 in the Tax’s Foundation’s 2016 State Business Tax Climate Index, which was released in November.

Read Tomblin's entire address here.

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Meanwhile, in the States...

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Posted by Emily Leayman on Friday, January 15th, 2016, 9:50 AM PERMALINK

While there is gridlock on the tax front in Washington, there are many developments in state capitals across the country that affect taxpayers. 

Below is a roundup of state tax activity from this past week:

Arizona: Gov. Doug Ducey (R) proposes new income tax relief after a $1.2 billion budget surplus in 2015. 

Delaware: Delaware House Revenue and Finance Committee approves pro-growth change to corporate income tax structure. 

Florida: Gov. Rick Scott (R) pushes $1 billion tax cut plan in his State of the State speech.

Idaho: Idaho House Republicans promise tax cut this year after Gov. Otter (R) refused to include tax relief in his 2016 agenda.

Illinois: Still no budget for suffering Illinois in new legislative session. Ohio State study predicts 10 percent decline in Chicago Amazon sales with new cloud tax. 

Indiana: A state representative wants a temporary sales tax holiday on school supplies. 

Iowa: Gov. Terry Branstad (R) praises state fiscal practices, proposes increased K-12 funding in State of the State speech.

Kansas: Gov. Sam Brownback’s budget avoids dramatic cuts and new taxes. 

Kentucky: State senator introduces a bill to stop college tuition hikes

Maine: Department of health reveals $1.2 million in welfare fraud in 2015.

Maryland: Leading Dem threatens Gov. Larry Hogan with budget mandates if Hogan does not comply with their budget demands.

Minnesota: State collects $43 more in tax revenues than anticipated last year. 

Missouri: Missouri business groups voice support for gas tax hike, joining Gov. Jay Nixon (D).

Nebraska: Gov. Pete Ricketts (R) backs proposal to provide property tax relief by limiting local spending. 

Pennsylvania: Partial budget plan put in place, but many worry the impasse has not ended.

Rhode Island: Plan to increase truck tolls comes under fire, will hurt Dems in general election.

South Dakota: Gov. Dennis Daugaard (R) encourages legislature to pass sales tax increase to fund teacher pay raise.

Tennessee: Lawmakers to debate gas tax hike in support of transportation funding.

Utah: Lawmakers finally realize voluntary sales tax reporting is absurd.

Virginia: Lawmakers expect battle over Gov. Terry McAuliffe’s record $109 billion budget.  

Wisconsin: Gov. Scott Walker (R) rolls out college affordability plan.

West Virginia: Gov. Earl Ray Tomblin (D) proposes tax hikes to balance budgets for 2016 and 2017.