Latest posts by Justin Haskins (see all)
- Ending Net Neutrality Will Save the Internet, Not Destroy It - December 16, 2017
- Venezuela’s Chaos Is the Logical End of Democrats’ Vision for America - August 24, 2017
- The Truth About EPA Chief Scott Pruitt’s ‘Scandals’ - March 1, 2017
Editor’s Note: This piece was also authored by Robert Paquin III, state government relations manager for The Heartland Institute.
In a state suffering from economic woes across the board, a recent proposal by Gov. Gina Raimondo (D) to install and implement a toll system for commercial trucks in order to pay for bridge repairs has passed in the Senate and is being held up in the House, surrounded by controversy.
The proposal, called RhodeWorks, if passed in its current form, would place a toll on both interstate and intrastate commercial vehicles. According to the Providence Journal, this toll would be added to as many as 22 bridges throughout the state, with a median cost of $6 per toll. Some estimates say it would cost many travelers an average of $50 to pass through the state.
Many local businesses in Rhode Island have been vocal in their opposition to this bill despite promises of tax credits, testifying before both chambers and making public appeals for a lifeline. Some local businesses threatened to move their business out of the state to avoid the financial burden.
R.I. House Speaker Nicholas Mattiello (D-Cranston) says Raimondo’s $600 million transportation proposal will place too great of a burden on local businesses that are already stretched thin. He says he will not allow it to pass the House.
“You cannot move forward with a billion-dollar proposal without taking the concerns of your large businesses into account, and that’s what I’ve tried to do—and if that requires a little more time and it brings us into the fall, so be it,” Mattiello said, according to a report by WPRI.com’s Ted Nesi.
There is no doubt that the roads and bridges of Rhode Island need repair, but that money cannot come from the businesses that are the lifeblood of a struggling economy. Currently, Forbes ranks Rhode Island as the 46th least business friendly state in the United States, and the Tax Foundation recently ranked Rhode Island as having the 8th highest tax burden in the country—a figure that is staggering given the state’s tourism potential.
Attempting to tax the residents of Rhode Island to pay for repairs would be just too much for many businesses to handle. The idea that funding the majority of a massive $600 million project using tolls on trucking is foolish, as anyone on Smith Hill who takes the time to look at a map of the Interstate Highway System would realize.
Rhode Island is the smallest state in the nation, making it easy for transportation companies that currently travel through the state to avoid it altogether completely. Many businesses located in the state that conduct a lot of business in surrounding states would be further incentivized to leave Rhode Island if Raimondo’s toll plan is implemented.
Take Ocean State Job Lot, for instance. Its CEO Marc Perlman recently told WPRI.com that 85 percent of its business is done outside of Rhode Island. It would make a lot more sense for Ocean State Job Lot to move to Connecticut or Massachusetts, where many taxes are already lower, and only pay costly tolls on 15 percent of its business than to stay in Rhode Island and face increased costs on everything it sells.
Mattiello says he’d be open to increasing the state’s gas tax as a way to keep tolls to a minimum, but Senate President M. Teresa Paiva Weed (D-Newport) says taxing middle-income Rhode Islanders is not a realistic option.
While the House and Senate bicker over which ways of raising taxes are most preferable, perhaps they should consider that their out-of-control spending is the real culprit. According to Governing, Rhode Island collected $13.4 billion from fiscal years 2008–2012, while its New England neighbor New Hampshire was able to operate a more efficient government despite having a higher population and a much larger geographic area to cover on only $11.2 billion in tax revenues.
Funding for necessary bridge repairs should come out of the state budget, and room must be made for infrastructure repairs without burdening resident or corporate taxpayers. Lawmakers in Rhode Island would be wise to consider other alternatives so as not to push the state any further down in the national rankings, thereby driving businesses out of Rhode Island and disincentivizing any new businesses from moving into Rhode Island.