Governor Dan McKee has released his proposed state budget for fiscal year 2025, calling it an investment in education, health care and small business.
McKee said the state’s goal is to reach Rhode Islanders’ full potential by investing in education and providing better health outcomes. He said the budget also includes initiatives to help small businesses thrive.
“The Team Rhode Island budget that I’m sending to the General Assembly today prioritizes programs and initiatives that will help raise the incomes of our fellow Rhode Islanders,” McKee said. “By using available resources in a targeted and strategic manner, we will continue to make progress on our RI 2030 goals while putting Rhode Islanders to work in good-paying jobs on projects that will pay dividends for decades to come.”
Among the investments in the Governor’s budget proposal are:
Education
Raising the additional amount of per-pupil funding for Multilingual Learners in the three lowest proficiency categories from 15% to 25% of the per-pupil amount. More support for this student population is important to accelerate gains in English proficiency.
Investing $15.0 million to improve outcomes in math and English language arts by providing coaching services to local education agencies with the most acute academic needs, as well as professional development opportunities for teachers and funds to meet the needs of students, families, and teachers.
Adding 35 Pre-K classrooms totaling 700 seats for the start of the 2024-25 school year. This will bring the total number of Pre-K seats to 3,000 – a pivotal step in achieving the State’s goal of offering 5,000 seats by 2028.
Transitioning roughly 6,500 students in Rhode Island public, charter, and state schools from being eligible for reduced-price breakfast and lunch to receiving both meals at no cost to their families.
Providing $5.0 million to support high-quality, out-of-school-time programming, with an emphasis on critical skill development.
Increasing state funding formula aid by $19.2 million, which raises per-pupil funding to $12,335 – an increase of $459 from the enacted FY 2024 level.
Health and Human Services
Investing $20.4 million in general revenue ($51.2 million, all funds) to phase in new Medicaid rates that were proposed as part of the Office of the Health Insurance Commissioner’s rate review process in 2023. The Governor proposes phasing in these higher rates over three years for all services except for Early Intervention.
Fully funding the rate increase for Early Intervention in FY 2025 with $1.7 million in general revenue ($3.8 million, all funds). This represents further support for a program that promotes the development of infants and toddlers who have a developmental disability or delay.
Providing $29.1 million in general revenue ($79.7 million, all funds) to establish rates and support operating costs for Certified Community Behavioral Health Clinics – a new model of care to provide a comprehensive range of behavioral health services to improve outcomes and reduce reliance on emergency departments.
Providing additional state-directed payments to hospitals with approximately $90 million in general revenue and $284 million from all funding sources to improve quality and create better rate parity between commercial health insurance and Medicaid rates. These payments, which were approved in the enacted FY 2024 budget, will reduce the gap between rates and provide hospitals with additional financial support.
Launching a new Summer Electronic Benefit Transfer program to ensure children have access to nutritious meals during the summer months when school is out of session.
Supporting nursing homes with $10.0 million in State Fiscal Recovery Funds to bridge the gap from July to October when new rates along with an annual inflationary index take effect.
Raising Incomes, Small Business, and the Economy
Raising the exemption for taxable retirement income from $20,000 to $50,000 staring in tax year 2025 – projected to save Rhode Islanders $3.0 million in FY25 and $6.2 million in FY26.
Cutting the corporate minimum tax from $400 to $350, which is expected to benefit approximately 65,000 entities.
Eliminating various nuisance fees to help households and small businesses.
Building on prior investments to advertise Rhode Island as a destination for tourism and business travel with an additional $1.4 million.
Investing $0.5 million to expand efforts to register minority and women business enterprises to maximize their participation in state procurements.
Providing $1.0 million in grants to municipalities and economic development agencies to revitalize main streets and business districts.
Generative artificial intelligence (AI) assisted a What’sUpNewp journalist with the reporting included in this story.
