RI Senate to examine struggling state economy

AP News
Posted: Dec 07, 2009 3:39 PM

Rhode Island should consider merging the services provided by more than three dozen cities and towns into a county system to save money and give more foreclosure protections to renters and homeowners, Senate President M. Teresa Paiva-Weed said Monday before hosting a summit on the state's struggling economy.

The Democrat outlined several of her economic priorities ahead of a meeting where lawmakers will consider responses to a deep recession that pushed unemployment to 12.9 percent, drove the state budget into the red and accompanied a collapse in housing prices.

Her forum comes almost a week after House lawmakers gathered in the Statehouse to consider a recession that started in early 2007. They left without adopting any course of action.

Sen. Leo Raptakis, D-Coventry, who has faulted Paiva-Weed for doing too little to fix the state's economy, said Rhode Island needs more action and less talk.

"I don't want to hear what the foreclosure rate is in Rhode Island," he said. "I want to hear a solution about tackling the foreclosure rate."

The Senate's agenda on Monday is broken into topics where Paiva-Weed expects action when the General Assembly reconvenes in January, such as municipal consolidation, the foreclosure crisis and the tanking state budget.

State lawmakers will hear from a New Jersey official about that state's attempt three years ago to consolidate local government. As Rhode Island's budget has grown bleaker, Rhode Island Gov. Don Carcieri and Democratic lawmakers have proposed merging government services among the state's 39 cities and towns to save money.

A special commission in the Senate already has started examining the issue and should issue its recommendations in the coming year, Paiva-Weed said. A separate commission is investigating whether lawmakers should abolish cost-raising requirements for local government, for example, abolishing a rule forcing them to hire school bus monitors.

Economists have blamed the collapse of an abnormally large bubble in home prices as one of several causes of Rhode Island's deep economic woes. Lawmakers will hear Monday from an expert at the Federal Reserve Bank of Boston on the state's foreclosure rates.

Paiva-Weed expects lawmakers will renew a push for legislation requiring that lenders notify delinquent homeowners about the availability of financial counseling, give tenants notice before they are evicted and make clear who is responsible for maintaining foreclosed homes.

Carcieri vetoed legislation last month that would have given borrowers a 75-day warning before a foreclosure could begin. At the time, Carcieri said the bill also should have protected renters. The governor faulted city and town governments for passing restriction on foreclosures that he said could create confusion and cause lenders to abandon Rhode Island.