Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Transportation Funding topic
No spam. Unsubscribe anytime.
Governor proposes 2¢ gas-tax rollback and shifts from DOT to close RIPTA's $13.8M shortfall; Newport fee increase draws local concern
Summary
Budget staff and the state budget officer described a package to close a projected $13.8 million RIPTA deficit that includes returning a 2¢ gas-tax portion to taxpayers (post-bond defeasance), shifting $9.3M from DOT's highway-maintenance share to RIPTA, and dedicating increased Newport cruise fees; the City of Newport told the committee the city has already adjusted local fees and warned about implementation timing.
State budget staff told the House Committee on Finance the governor's transportation package for FY2027 would reduce the motor-fuel tax rate by 2¢ and reallocate existing highway-maintenance account (HMA) revenue to help close RIPTA's $13.8 million projected operating deficit. Sharon's presentation explained that the 2¢ reduction stems from the payoff (defeasance) of motor-fuel-bond debt; the 2¢ had previously been pledged for debt service and, with the bonds paid off in December 2025, the governor proposes returning that portion to taxpayers.
Joe Cadiga, the state budget officer, told the committee the administration recommends three core moves to close RIPTA's projected gap: increasing RIPTA's share of HMA distributions (shifting $9.3 million from DOT), raising Newport's cruise-ship landing and boarding fee (proposal adds $5 each way and dedicates the increment to RIPTA), and applying $3.5 million of RICAP funds for buses. Cadiga said the HMA and bond carry-forward balances (staff cited roughly $170 million carry forward in the HMA and bond cash balances) informed the decision to reallocate funds to transit.
Sharon and Cadiga described the allocation changes in historical context: since 2014 the state has adjusted gas-tax indexing and surcharges and dedicated portions to transportation and to RIPTA; more recent adjustments created fixed allocations and surcharges intended to grow the fund. Under the governor's proposal, staff said DOT's annual resources would fall by about $18 million overall compared with current-law distribution formulas.
City of Newport representative Joseph Baxter told the committee the city increased embarkation/disembarkation fees locally and said the municipality had scheduled implementation with industry lead times. "There's already been, thousands and thousands of tickets sold and cruises booked for Newport, so it would create a logistical nightmare, to try and go back and fix this now," Baxter said, urging care on effective dates and the revenue stream for ongoing construction at Pratty Park.
Committee members pressed administration witnesses on enforcement, fare strategies, and whether fare increases were assumed in RIPTA's FY2027 projection. RIPTA representatives said a fare study and board discussion are underway and that some fare revenue growth was assumed in the FY2027 projections; members asked for more detail on elasticity, ridership impacts, and engagement with cruise operators and local stakeholders. No vote or formal action occurred at the hearing.
