Under the Dome: Advocacy in Action

Revenue Estimating Conference Receives Economic Forecast
Last week the Revenue Estimating Conference (REC) received the economic forecast from Moody’s Analytics which is used to assist the conferees in gauging income potential for FY26 and FY27. Not surprisingly, the presentation started with an acknowledgement of the uncertainty related to the federal tariffs and the potential economic changes that could result. If the tariffs are implemented at the full 19% increase as first proposed, Moody’s estimates the national GDP will decrease one to one and a half percent. That said, they do believe a “pivot” will likely occur as businesses and households pull back on spending and as tariff negotiations continue. Each one dollar in personal wealth tends to increase spending by two cents. While that seems small, it adds up quickly.
For Rhode Island, employment currently remains solid, outpacing Massachusetts, Maine and Connecticut in New England. Moody’s does anticipate an increase in the jobless rate as growth in employment declines. Moody’s estimates the state unemployment rate will hit five percent by the end of the year.
The economists pointed out that business costs are high in Rhode Island - citing labor, taxes and particularly energy. Not only do businesses suffer from significantly higher energy costs, but residential energy rates are also high – the second highest in the country (Hawaii is number one). Tariffs will increase other costs for businesses.
“Consumers don’t have it much better,” said Kumael Bilgrami from Moody’s Analytics. Rhode Island ranks higher on the expense side compared to other New England states, but wage growth has been above the US average. Boston’s wage growth is worse than Rhode Island; and since Boston is the biggest “out-of-state” employer for Rhode Islanders, this provides another challenge.
Longer term issues the state should consider is the expected decline in population through 2029. Rhode Island has experienced outward migration since 2006. Top destinations for exiting Rhode Islanders are Florida, Texas, Connecticut, South Carolina, North Carolina, New Hampshire and Maine. International migration into the state has held back the population decline but recent changes in federal policy could soften this migration pattern. Moody’s confirmed Massachusetts is losing residents to Rhode Island because the housing costs are cheaper than Boston.
Lastly, the state ranked in the top ten states for receiving federal funds for items such as clean energy and Medicaid. Federal policy changes are expected to impact Rhode Island more than other states for this reason.
The REC adopted the following changes to the November conference expectations:
· Smaller growth in wages and salaries
· Higher growth in personal income
· Smaller growth in dividends, interest and rent growth
· Higher personal consumption expenditures in FY26 but lower in FY27
· Higher unemployment rate
· Higher CPI
· Lower Corporate profits growth in FY26 but higher in FY27
These changes will affect the revenue estimates that will be adopted Friday, May 9th.
This Week At the State House
Tuesday, May 6th
House Finance – Taxes and Economic Programs
The House Finance posted an agenda of bills to be heard at the Rise (approximately 4:30) in Room 35.


H.5473, An Act Relating to Taxation – Personal Income Tax, adds an additional 3% personal income tax on taxable income over $430,000, starting January 1, 2026. However, the amount of $430,000 is to be adjusted for inflation going back to the value of a dollar in 2011. Once the inflation adjustment is made, the 3% increase actually applies to taxable income over $625,000 in 2026 and then is adjusted upwards each year thereafter. https://webserver.rilegislature.gov/BillText/BillText25/HouseText25/H5473.pdf


H.5531, An Act Relating to Taxation – Rhode Island Qualified Jobs Incentive Act 2015, sunsets the economic program July 1, 2025. The Governor’s proposed budget calls for sunsetting the program December 31, 2026. Rhode Island’s Qualified Jobs Incentive Program offers businesses an opportunity to expand their workforce while reducing costs. Companies that create new positions or relocate jobs to the state can receive annual, redeemable tax credits for up to ten years, with credits of up to $7,500 per job per year. https://webserver.rilegislature.gov/BillText/BillText25/HouseText25/H5531.pdf


H.5753, An Act Relating To Taxation – Business Corporation Tax, exempts a newly formed Sub Chapter S corporation from paying the minimum corporate income tax in its first year of existence. https://webserver.rilegislature.gov/BillText/BillText25/HouseText25/H5753.pdf
To submit testimony on any of these bills, email it to [email protected]
Senate Commerce – Grocery Store Checkout Lanes
The Senate Commerce committee is scheduled to vote Tuesday (At the Rise) on S.85, An Act Relating to Commercial Law – Grocery Stores. This bill limits grocery stores, defined as a “retail store in the State of Rhode Island that earns the majority of its gross income from the retail sale of groceries and sells primarily household foodstuffs for off site consumption,” to have no more than six self-checkout stations. If the business does have self-checkout stations, it must also open one manual checkout station for each self-checkout station. The Attorney General is
given authority to enforce the law under S.85. https://webserver.rilegislature.gov/BillText/BillText25/SenateText25/S0085.pdf


Senate Finance – Economic Programs
Senate Finance is taking testimony (At the Rise in Room 211) on S.111, An Act Relating to Taxation – Rhode Island Qualified Jobs Incentive Act 2015. This is the identical companion bill to H.5531 (see above) Testimony for the Senate bill can be emailed to [email protected]
Wednesday, May 7th
Senate Labor – Bullying Bill Returns
The Workplace Psychological Safety Act (often referred to as the bullying bill) is back in the Senate Labor & Gaming Committee. A vote was taken last week on the Senate floor to recommit the bill to committee. The bill is expected to be amended in the committee Wednesday, At the Rise, (the Senate is now holding Wednesday sessions) and passed again. The SubA version has not been posted yet. The bill that passed, while well meaning, would place employers in an extremely difficult position and would result in many lawsuits as well as endless investigations. The definition of "psychological abuse" under this bill includes actions such as “mistreatment that has the effect of hurting, weakening, confusing, or frightening a person mentally or emotionally.” These terms are very subjective. They can mean different things to different people, leaving everyone wondering what they can and cannot do or say in the workplace. Watch next week for further details on the expected SubA.


Senate Environment & Agriculture – Packaging


A great deal of attention is focused on efforts to pass a bottle deposit and redemption bill, an environmental producer responsibility (EPR) bill, or a combined bill. The proponents want to increase the recycling rate of bottles; certain members of the business community want producers of packaging to pay money into a new, advanced recycling system; and another group of businesses worry that the all of the proposals will increase the cost of products. On Wednesday, At the Rise in the Senate Lounge, the following bills will be heard:


S.996, An Act Relating to Health and Safety combines both a ten-cent bottle deposit on most beverages (soda, water, juices, alcohol, etc.) and an EPR program. If your business produces and packages products, sells products under a brand, or imports products that are unbranded, please read S.996 The 57-page bill can be reviewed at https://webserver.rilegislature.gov/BillText/BillText25/SenateText25/S0996.pdf


S.997, An Act Relating to Health and Safety – Beverage Container Recycling Act, calls for a ten-cent deposit on almost all beverage containers. The bill envisions the creation of recycling centers, not a requirement placed on retailers to redeem beverage containers, with penalties placed on a beverage producer organization if recycling target rates are not met. Deposits that
are not redeemed by consumers are to be used for recycling education programs, the creation of additional recycling centers and other activities required as a result of the deposit and redemption program. The 27-page bill can be found at https://webserver.rilegislature.gov/BillText/BillText25/SenateText25/S0997.pdf
Testimony for S.996 or S.997 may be emailed to [email protected]




The following new bills have been filed:
House Bill No. 6282 Cotter, Carson, Donovan, Potter, Morales, Serpa, Ajello, AN ACT RELATING TO COMMERCIAL LAW -- GENERAL REGULATORY PROVISIONS -- GROCERY STORES (Requires grocery stores to specifically limit the number of self-service checkout units to six (6) units per location. The consumer protection unit of the department of attorney general would have authority to enforce these restrictions.) https://webserver.rilegislature.gov/BillText/BillText25/HouseText25/H6282.pdf House Bill No. 6290 Potter, Cotter, Cruz, Giraldo, Stewart, Tanzi, Kislak, Ajello, AN ACT RELATING TO TAXATION -- WEALTH TAX (Imposes a wealth tax on Rhode Island individuals and entities at a rate of one percent (1%) of worldwide wealth.) https://webserver.rilegislature.gov/BillText/BillText25/HouseText25/H6290.pdf
Senate Bill No. 996 McKenney, Tikoian, Britto, Lawson, Sosnowski, LaMountain, Murray, Gu, Vargas, AN ACT RELATING TO HEALTH AND SAFETY (Provides extended producer responsibility for packaging and paper, recycling of beverage containers, and provides general provisions for oversight of single-stage producer organizations.) https://webserver.rilegislature.gov/BillText/BillText25/SenateText25/S0996.pdf
Senate Bill No. 997 Valverde, Sosnowski, Lawson, McKenney, Gu, Vargas
ENTITLED, AN ACT RELATING TO HEALTH AND SAFETY -- BEVERAGE CONTAINERS RECYCLING ACT (Establishes the Beverage Container Recycling Act) https://webserver.rilegislature.gov/BillText/BillText25/SenateText25/S0997.pdf
Senate Bill No. 1002 Bissaillon, LaMountain, AN ACT RELATING TO STATE AFFAIRS AND GOVERNMENT -- REBUILD RHODE ISLAND TAX CREDIT (Amends provisions related to the maximum project credit allowed under the rebuild Rhode Island tax credit for certain qualified development projects.) https://webserver.rilegislature.gov/BillText/BillText25/SenateText25/S1002.pdf