Rhode Island faces $513 million budget shortfall

The deficit will be among the first issues Lt. Gov. Dan McKee must face once he replaces outgoing Gov. Gina Raimondo

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LEADING OFF

Happy Wednesday and welcome to Rhode Map, your daily guide to everything happening in the Ocean State. I’m Dan McGowan and it was painful to watch Providence College basketball last night. Follow me on Twitter @DanMcGowan or send tips to [e-mail].

ICYMI: Rhode Island was up to 101,393 confirmed coronavirus cases on Tuesday, after adding 661 new cases. The overall daily test-positive rate was 5.7 percent, and the first-time positive rate was 19.3 percent. The state announced 23 more deaths, bringing the total to 1,970. There were 402 people in the hospital, and 36,649 residents had received the first dose of the vaccine.

Welcome to the governor’s office, Dan McKee. Can you pick up this $500 million tab?

A report released Wednesday by the Rhode Island Public Expenditure Council (RIPEC) shows the state is likely facing a $513.7 million budget shortfall for the fiscal year that begins July 1, and suggests that “the continued phase out of the car tax does not appear to be affordable.”

The staggering deficit will be among the first issues McKee must face once he replaces outgoing Governor Gina Raimondo, who is joining President-elect Joe Biden’s cabinet as commerce secretary. But the report notes that additional federal funding could help improve the budget picture.

RIPEC’s report shows the state’s shortfall is closer to $660 million, assuming that state spending will grow by 3 percent in the 2021-’22 fiscal year and that $30 million will be repaid to the rainy day fund. But more than $100 million of that is expenditures that are likely to be covered by the relief package that Congress approved in December, which brings the total down.

The report concludes that while COVID-19 vaccinations have begun, “the future course of the pandemic remains unclear” and it is likely that the state “will need to continue to respond directly to the public health demands caused by the pandemic for the next several months.”

”Consequently, Rhode Island’s economy will continue to struggle as state restrictions and individual choices limit economic activity,” the report states. “Even after restrictions are lifted, the pace and strength of economic recovery is uncertain.”

The recommendation from RIPEC that is likely to draw the most attention involves the car tax phase out, a popular move by former House Speaker Nicholas Mattiello that was designed to gradually reduce (and eventually eliminate) the annual motor vehicle excise tax that cities and towns impose on residents. RIPEC’s report doesn’t say whether the phase out should end completely or be restructured.

RIPEC also suggests that the state should revisit its education funding formula to determine “whether it is affordable and is best structured to deliver on equitable funding and improvements in student outcomes.”

THE GLOBE IN RHODE ISLAND

⚓ US Representative David Cicilline will be one of nine impeachment managers to prosecute the case against President Donald Trump in the US Senate. Read more.

⚓ Congressman Cicilline’s offices in Pawtucket and Washington continue to receive threats because of Cicilline’s role in the impeachment proceeding. Read more.

⚓ The state Senate on Tuesday voted for a resolution condemning “the acts of violence and insurrection” at the US Capitol last week and calling for the removal of President Trump. Read more.

⚓ State lawmakers are questioning how a consulting firm got a $76,000-a-week contract to review Rhode Island College. Read more.

MORE ON BOSTONGLOBE.COM

⚓ Politics: As House Democrats speed toward impeaching President Trump for a second time, numerous Republicans declared that holding the Commander in Chief accountable for inciting a violent assault on Congress would further divide the nation and urged their colleagues to turn the page for the sake of unity and healing. Read more.

⚓ Boston: Mayor Marty Walsh delivered what is likely to be his final State of the City address last night. Read more.

⚓ Education: UMass Dartmouth has a new interim chancellor. Read more.

⚓ Sports: If you’re a baseball fan, check out how the Globe’s six Hall of Fame voters made their picks this year. Read more.

WHAT’S ON TAP TODAY

Each day, Rhode Map offers a cheat sheet breaking down what’s happening in Rhode Island. Have an idea? E-mail us at [e-mail].

⚓ BIRTHDAYS: Rhode Map readers, if you want a friend or family member to be recognized on Friday, send me an e-mail with their first and last name, and their age.

⚓ Governor Raimondo and Lieutenant Governor McKee are holding a joint press conference to discuss COVID-19 numbers (and presumably, the transition) at 1 p.m.

⚓ Providence Mayor Jorge Elorza is holding a 10 a.m. press conference to discuss the city’s new climate justice plan.

⚓ Rhode Island PBS will air a tribute to reporter Bill Rappleye, who died last week, at 7 p.m.

⚓ The Center for Youth & Community Leadership in Education (CYCLE) at Roger Williams University and the Social Policy Hub for Equity Research in Education (SPHERE) at Rhode Island College are hosting a 5:30 p.m. virtual discussion about the impact of school resource officers in Providence schools.

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