Chafee On Governance, Meals Tax

Gov. Lincoln Chafee got to spend part of his 59th birthday with second graders from Meadowbrook Farms Elementary School this past Monday — receiving a rousing rendition of "Happy Birthday to You" in the process. Afterward, he outlined why he thinks the meals tax is necessary.

Chafee visited Meadowbrook to participate in Reading Week, a yearly event where a variety of celebrity "readers" are recruited to read for students.

After he read Bats at the Library, by Brian Lies, the children asked Chafee some questions — "Is it hard being governor?" one young girl asked.

"Yes, it is, I'll be honest," replied Chafee. "It's a very demanding, busy job." He acknowledged that "sometimes the people aren't happy, and they boooo."

Some of those "boos" these days are coming from on meals eaten out.

At Meadowbrook Monday after the reading, Chafee said the tax was specifically designed to help out cities and towns struggling to cover the cost of education. His plan would accelerate the funding formula that benefits some cities and towns which received less than they were supposed to in recent years.

Under the plan, East Greenwich is one of the municipalities that would see additional aid. While additional state aid is welcome news to EG officials, it could make the difference between bankruptcy and some degree of financial independence to cities like Providence, Pawtucket, Woonsocket, and West Warwick.

"They slashed aid to cities and towns," said Chafee, referring to budget cuts made by then-Gov. Carcieri and the General Assembly. "You just can't cut what they cut. My tax on restaurants is to try and reverse that."

The tax, he said, is "dollar for dollar" matched to speeding up the funding formula.

He argued that what happens in other cities and towns in Rhode Island matters to East Greenwich.

"If Providence goes bankrupt, that affects all of us," he said.

His communications director Christine Hunsinger elaborated. "What happens in West Warwick matters to East Greenwich. East Greenwich can't remove itself from the state's problems," she said, with a nod to EG's still-high bond rating.

For the governor, expanding the tax on a discretionary expense may well make the difference for those really struggling cities.

"Woonsocket, they're right on the edge — a $700 tax bill [increase] versus the choice we make when we go out to eat," he said.

He admitted that "no tax is a good tax" but said, "The evidence in New England states that raised the meal tax is that it did not affect the restaurant business."

He mentioned an increase in Massachusetts from 5 percent to 6.25 percent in 2009. Cities and towns in the Bay State were also given permission to raise the restaurant tax locally up to .75 percent in 2009. More than 40 percent of Massachusetts cities and towns have boosted their local meals tax since then.

Chafee said he still preferred the option he proposed last year, to broaden the sales tax — on items such as clothing, food and meals — while lowering it overall. That plan, however, failed to garner any support last spring.