Rhode Island will thrive with right investments

Rhode Island will thrive with right investments

There is no silver bullet for revitalizing our economy. Governor Raimondo understands that. Her economic development strategy is a comprehensive one that takes aim at making state government more fiscally responsible, making it cheaper and easier to do business by cutting taxes and burdensome regulations, investing in our infrastructure, invigorating our education system and making our economy more competitive.

After less than a year and a half in office, the Raimondo administration has built on the powerful legacy of pension reform and brought even greater stability to our state budget by reforming Medicaid; Rhode Island is on track to save $100 million a year without restricting access or cutting quality of care, but by holding groups accountable for poor service. We’ve eliminated the sales tax on energy for businesses, and this year the Governor is seeking a $30 million cut to the unemployment taxes Rhode Island businesses need to pay. She has scrapped unnecessary, duplicative or burdensome professional licenses that make it hard for Rhode Islanders to start their own businesses and initiated various “lean” activities to streamline government processes

We’re also reinventing our education and workforce development program to give all Rhode Islanders the skills they need to succeed in the 21st century. Rhode Island is already being recognized nationally for its innovative plan to put computer science in every K-12 classroom. In conjunction with Rhode Island businesses, Real Jobs RI is helping train workers for jobs that actually exist. The Wavemaker Fellowship is stopping the “brain drain” through student loan repayments, keeping our best and brightest in state to start businesses and work in the high-growth industries of the future.

All this begins to create the stable, attractive business environment we need to grow. But it’s not enough.

Governor Raimondo’s economic development plan builds our state’s capacity to compete both nationally and globally. Last year, she proposed a slate of economic development programs to get our state’s economy on the right path and get Rhode Islanders back to work. Some of these programs are tax credits, with new safeguards to protect taxpayers from bad deals, to spur real estate development and job creation. Others aim at increasing our businesses’ and universities’ capacity to work together to create innovative products that will let Rhode Island’s small businesses grow and prosper.

It’s all too easy for people to lose faith in their government today. But the reforms at the Commerce Corporation over the past year should be a source of confidence for Rhode Islanders. When a company works with the Commerce Corporation, they actively apply for these state incentives and go through a rigorous and competitive screening process before receiving any awards. Further, no tax credits are paid out under these programs unless commitments are fulfilled and companies are either paying income tax for the jobs they said they would create or they have built the building they proposed to develop. These are strong safeguards to protect taxpayers from bad investments. Further, with some of our programs, in the event an investment performs better than projected, taxpayers could see a return of capital to the state on our investment.

Over the past two decades, the free market has chosen—against Rhode Island. It has decided that Rhode Island would see the greatest decline of advanced industry of any other state in the country.

Since last year’s budget, more than 88 companies, cities and towns, construction projects and industry groups have received one of the new incentives under the Raimondo Jobs Plan. So far, the Commerce Corporation has awarded more than $30 million in incentives, and those funds will leverage over a quarter of a billion dollars in private capital investment to spur economic activity.

Many of the programs are aimed at helping small businesses grow. Eleven of them, for example, received Innovation Vouchers that provide small-scale funding companies to conduct critical R&D with a Rhode Island–based research institution to create better products, grow their businesses and create jobs. These and other programs are helping to build an innovation-based economy that will allow Rhode Island to grow and thrive.

For much of its history, the Ocean State has been home to a thriving economy. We occupy a strategically important position between Boston and New York. We are home to world-leading businesses, an unrivaled quality of life and a population determined to see prosperity return. We can sit back and watch it decline further while other states employ the very tactics our critics rail against and take more jobs and companies away from us. Or we can continue making the tough prudent decisions required to get our state working once more and see Rhode Island companies and products spread around the world as they have for centuries.

Darin Early
President of the Rhode Island Commerce Corporation