An Update from the State House
Chamber Testifies In Favor of Insurance Jobs Bill
After months of meetings, the Department of Business Regulation, together with the property casualty insurance industry, developed an innovative idea to help Rhode Island attract and create jobs. H.8058, An Act Relating to Taxation – Taxation of Insurance Companies, proposes to lower the premium tax paid by insurance companies by an amount equal to the revenue realized by the state through additional income tax dollars paid by the new/additional insurance company employees. The reason this idea is so unique, is that insurance companies are subject to retaliatory taxes in other states. For example, ABC insurance company located in RI is subject to a 2% premium tax on insurance sold to RI citizens. If ABC insurance company sells insurance to citizens of CT which has a premium tax of 1.75%, ABC insurance company would be required to pay the state of CT a 2% premium tax because that is the tax assessed in RI. By lowering the premium tax here in RI, the state is in a strong position to attract insurance companies to relocate to the state, and to encourage locally domiciled insurance companies to grow jobs here as opposed to in other states – all at a revenue neutral impact to the state. According to the Department of Labor and Training, the state’s unemployment rate dropped to 5.3% last month. While that is a positive for RI, the state also lost 1500 jobs. The Chamber testified that H.8058 “utilizes a unique idea to help our state regain some of those lost jobs.
House Committee on Environment and Energy Hears Burrillville Power Plant Bill
The proposed Invenergy power plant has received a lot of attention in the media recently. While Invenergy is primarily a renewable energy company, it believes all types of energy is needed to meet the needs of the public at this time. Of Invenergy’s 13,000 MW generating facilities throughout the United States, Canada and Europe, approximately 8,000 MW is generated by wind.
The proposed facility in Burrillville is a $700 million natural gas facility using Combined Cycle Advanced Technology, which would make it one of the most efficient plants in the US. The plant would generate 1,000 MW. Using an air cooling system allows the plant to reduce its need for water by 90% over traditional power plants. The facility would be located on 730 acres of land that are currently zoned to allow for the building of a power generating plant. The plant hopes to be operational by June 1, 2019. The New England region will lose approximately 4,200 MW of electricity generation by 2019 due to the retirement of older plants such as Pilgrim and Brayton Point. An additional 6,000 MW is deemed “at risk” of closure by ISO NE, the independent, not-for-profit company authorized by the Federal Energy Regulatory Commission (FERC) oversee the wholesale electricity generation market in New England.
The House Committee on Environment and Energy heard testimony on H.8240, An Act Relating to State Affairs and Government – Energy Facility Siting Act. The bill increases the number of people on the energy facility siting board from three to nine and bans the appointment of any person who received a significant portion of their income from an energy company or from an oil, gas or electric company. The bill also states that any tax treaty approved by the Town Council of Burrillville would have to be put before the voters for their approval. If the Town Council chose to extend a tax treaty by resolution in the future, that resolution would again be subject to voter approval. The Chamber opposes the voter referendum approval requirement. If passed, this type of procedure could be utilized to kill any project – energy, retail, transportation, etc. The proponents of the H.8240 see this as an opportunity to stop the Invenergy plant in Burrillville.
State Budget Vote Expected This Week
The House Finance Committee is expected to vote on the FY2017 budget either Tuesday, May 31st or Wednesday, June 1st. If passed, the full House could then vote on the budget June 7th or 8th. The Chamber will be reviewing the document as soon as it is released, so watch your email for possible alerts.
Below is a list of new legislation that was filed this week. The list contains bill numbers, links to the legislation, and summary explanations.
House Bill No. 8250, AN ACT RELATING TO TAXATION - PROPERTY SUBJECT TO TAXATION - BURRILLVILLE (Authorizes the town of Burrillville to extend its tax-stabilization program to cover mixed-use properties.)
Senate Bill No. 3036, AN ACT RELATING TO BUSINESSES AND PROFESSIONS - BARBERS, HAIRDRESSERS, COSMETICIANS, MANICURISTS AND ESTHETICIAN (Amends various sections of law relating to the certification, training and licensing of barbers, hairdressers, cosmeticians, manicurists and estheticians.)
Senate Bill No. 3037, AN ACT RELATING TO STATE AFFAIRS AND GOVERNMENT - ENERGY FACILITY SITING ACT (Increases the membership of the energy facility siting board from three (3) to nine (9) members, and requires approval by the electors in Burrillville of any tax agreement established by the town council with a power plant located in the town.)