RI Foundation panel considers housing, mental health and training the best uses of the $ 1.1 billion federal windfall

PROVIDENCE, RI (WPRI) – Affordable housing and support for hard-hit communities should be top priorities for Rhode Island leaders as they spend the state’s $ 1.1 billion in funding for American Rescue Plan Act, according to a highly anticipated report released on Tuesday.

General Assembly leaders are awaiting recommendations from the 15-member steering committee – which was convened by the Rhode Island Foundation in April – before moving forward to spend the federal manna. The money is to be allocated by the end of 2024 and spent by the end of 2026.

“A lot of eyes will be on how this money is spent,” said Rhode Island Foundation President and CEO Neil Steinberg, who chaired the panel.

“We used the example of two specific situations that we don’t want to happen,” he said. “One is, we don’t all want to sit here in five years and say, what happened to that billion dollars? The other thing is, we don’t want to sit here in two years and say, why isn’t that money coming out the door? “

The steering committee proposes that the state spend the lion’s share of bailout funding in five areas: $ 405 million on housing; $ 255 million for behavioral health care; $ 205 million for workforce development; $ 100 million for small business assistance; and $ 50 million for “neighborhood trusts” that would support community groups in selected locations. An additional $ 50 million will go to immediate aid.

“These were big issues that predated COVID; COVID made it all worse, ”Steinberg said. “And this has made the situation especially worse for people in underrepresented and underserved communities. “

The foundation worked with the Rhode Island Public Expenditure Council (RIPEC), a business-backed think tank, and the Economic Progress Institute, an advocacy group for low-income Rhode Islanders, to spell out the details of each proposal. This followed months of awareness including focus groups, community listening sessions and a general solicitation of ideas.

Steinberg said a number of other major policy areas – including education, transportation and broadband – were not included in the steering committee’s recommendations for the $ 1.1 billion because they have dedicated funds either elsewhere in the US bailout or in infrastructure and budget reconciliation. bills currently pending in Congress.

Analysis from Target 12 shows that the Rescue Plan Act, which President Biden signed in March, sends more than $ 2.8 billion to the state of Rhode Island, its municipalities and school districts. The much-discussed $ 1.1 billion is Rhode Island’s share of the State Fiscal Recovery Fund, a sum of money included in law that states have a lot of leeway to spend.

The steering committee’s recommendations come shortly after Gov. Dan McKee released his own proposal to spend the top 10% of the $ 1.1 billion allocation. The governor wants to direct $ 74.5 million to RI Commerce Corp .; $ 13 million to the Executive Office of Health and Social Services; $ 13 million to the Department of Social Services; and $ 12.5 million to the Ministry of Children, Youth and the Family.

As part of McKee’s plan, the first round of spending would fund initiatives such as wage increases for social workers, financial and technical support for small businesses, and housing programs. Legislative committees will hold their first hearings on the governor’s proposal this week, but it is not clear whether lawmakers will return to State House to act on the plan before the end of this year.

Steinberg said his task force believes his proposed $ 50 million for immediate aid should be spent quickly, although he did not say it should happen until lawmakers begin their regular session in January. .

The foundation’s panel prioritization of housing comes as this issue is an increasingly hot topic at the State House. Home prices and rents have jumped in Rhode Island since the pandemic, in part due to a supply shortage after years of limited construction.

“I would say this is our most pressing social issue,” said Michael DiBiase, President and CEO of RIPEC. He said housing is also particularly suited to one-off investments as opposed to ongoing programs; the steering committee wanted to avoid the latter since the federal money will eventually run out.

Most of the money proposed for housing would be $ 200 million to build and maintain affordable rental housing. The committee also suggests building 500 permanent supportive housing units to help end homelessness; the creation of a home ownership program for people of color; and work to remove lead paint.

Referring to the wide range of existing programs and organizations that aim to expand the supply of affordable housing in Rhode Island, Steinberg said, “What we have done has not worked.

In the behavioral health category, the biggest proposal is $ 170 million to invest in mental health facilities statewide. Linda Katz, director of policy at the Economic Progress Institute, said the goal is to make their buildings “welcoming and of high quality” in the same way as community health centers.

The flagship idea on workforce development is $ 150 million for a new training program that would lead to jobs receiving new certifications or other skills advancements. DiBiase said the report plans to spend an average of $ 25,000 per employee on training, well above the roughly $ 3,000 to $ 5,000 of the existing Real Jobs Rhode Island program, which is geared toward the needs of employers.

Small business money would include $ 50 million for forgivable loans and $ 35 million for technical assistance.

The $ 50 million for the new neighborhood trusts is described in the report as spending “led by residents of the places whose populations and communities have been most affected by the pandemic.” It is intended specifically for residents of qualified census tracts, an official federal classification for low-income neighborhoods.

“There was a lot of support in our group for direct investment based investments,” said Steinberg.

The report suggests directing the $ 50 million in immediate aid to local nonprofit groups “to meet the immediate needs of communities, including providing treatment for mental health issues and use disorders. substances, reducing food and housing insecurity, meeting childcare and other basic needs, and responding to domestic violence. “

Katz said that a theme in all of the steering committee’s recommendations is to “make sure this recovery is about fairness and tackling historic and systemic racism in our country.” Many of the programs offered are designed to target low-income populations and minorities.

“What the pandemic has shown us are systemic issues that have been around for a very long time,” Katz said.

The report urges heads of state to pay close attention to how the money is spent and whether there is sufficient capacity to implement whatever is decided. He suggests creating an office to oversee all spending of the US bailout, headed by a cabinet-level official who reports directly to the governor.

“There is a concern that the government is not set up to make these very big investments,” DiBiase said.

Quoting the late management expert Stephen Covey, Steinberg said, “Most executives would agree that they are better off having an average strategy with superb execution than a superb strategy with poor execution.

This is not the first time that the Rhode Island Foundation has sought to play a role in steering state policy. In 2012, the foundation hosted a “Make It Happen RI” conference that generated ideas for economic development, and in 2015, it helped fund a Brookings Institution report on the Rhode Island economy that influenced the early days of the Raimondo administration.

The members of the Rhode Island Foundation Steering Committee were:

• Marcela Betancur, Executive Director of the Latino Policy Institute
• Jessica David, Consultant and Former Executive Vice President of Strategy and Community Investments at the Rhode Island Foundation
• Ditra Edwards, Executive Director of Sista Fire
• John Friedman, Professor of Economics and International and Political Affairs at Brown University
• John Galvin, President and CEO of AAA North East
• Marie Ganim, former State Health Insurance Commissioner and former State Senate Policy Director
• Ross Gittell, President of Bryant University
• Rajiv Kumar, tech entrepreneur and founder of ShapeUp
• Tony Maione, former President and CEO of United Way of RI
• Anna Cano Morales, Associate Vice President for Diversity, Equity and Inclusion at Rhode Island College
• Nina Pande, Executive Director of Skills for Rhode Island’s Future
• Dr Megan Ranney, Associate Professor of Emergency Medicine and Associate Dean, Brown University School of Public Health
• Nic Retsinas, Director Emeritus, Harvard Joint Centers for Housing Studies
• Don Stanford, Assistant Professor of Computer Science at Brown University and former CTO of GTECH
• Edi Tebaldi, Professor of Economics and Executive Director of Institutional Effectiveness and Strategy at Bryant University