2016-06-09 / Front Page

Chamber Grant Axed

By Tom Walsh

As the General Assembly heads toward its final 2016 chapter, the controversial $225,000 grant awarded annually by legislators to the Newport County Chamber of Commerce since 2003 has been cut from the 2016-2017 state budget.

“That grant is not in the state budget,” a well-placed legislative source told Newport This Week after late-night Statehouse meetings that ran into the early hours of Wednesday, June 8. “Funding for that has not been included.”

Later on Wednesday, Erin Donovan Boyle, executive director of the Newport Chamber, said she had just heard the news. “Hopefully we will have an opportunity to apply going forward,” she said.

According to Donovan-Boyle, “This is the only funding that the state has dedicated to the defense industry in Rhode Island. The New- port naval base is very important to Newport and the state.”

She said that losing the grant “stops everything we have been working on. Some projects won’t be included for the next fiscal year. It will stop everything the chamber has been working on for the past 15 years.”

The annual state grant to the Newport Chamber came from the Assembly’s controversial $11.6 million community service grant program. Democratic legislative leaders have pledged to overhaul that program and replace it with appropriations that fill “unique needs” around the state. These will be publicly listed as line items in the state budget that goes into effect on July 1.

A smaller $2.2 million legislative grant program – $1.1 million each for the House and Senate – will remain intact. “They could certainly apply for funds from that,” the Statehouse source said of the Newport Chamber.

Lawmakers also signaled that they would make “pools” of money available to state agencies to issue grants to community programs. For example, the Rhode Island Commerce Corporation might receive funds that organizations such as the Newport Chamber could apply for.

In March, the Newport Chamber’s grant became embroiled in a white-hot controversy over the manner in which Democratic Assembly leaders handled the program and determined where to allocate the money.

In particular, the Newport County Chamber was a focal point for the controversy because it used $80,000 of its $225,000 grant to pay the Mayforth Group, a government lobbying organization. This organization employs Keith Stokes, a Newport resident who, as the former executive director of the Rhode Island Economic Development Corporation, was a central figure in the 38 Studios failure.

The remainder of the chamber’s $225,000 grant was used to pay for several studies that Donovan-Boyle said were important for Aquidneck Island and all of Rhode Island. These include land re-use and infrastructure studies, the economic impact of the National Guard, and an examination of veterans and the resources that they typically use.

The executive director cited two reasons why the chamber’s efforts on this front are important. The first is that there are 165 acres of Navy land on Aquidneck Island that the Navy wants to be rid of. From an economic development perspective, she said, “What we do with that land is extremely important. The land will have a long-term economic impact. We shouldn’t overlook the benefit of this program.”

Secondly, Donovan-Boyle said, there is a need to be prepared in the event of an attempted Base Realignment and Closure (BRAC), a Department of Defense program that seeks efficiencies by closing bases around the country. The last occurred in 2005.

“Every few years you have to look at it,” said Bill Fischer, a chamber spokesman. “You don’t know when the next one will be.” He said $30,000 of the chamber grant is used to support the Defense Economy Planning Commission, an agency comprised of state lawmakers and other state and local officials that exists to help support and promote Rhode Island’s defense industry. Another $50,000 is used to enhance federal relationships, a permitted use of the funds by law, Fischer said.

“This is a good cause, protecting the state’s defense economy,” he added.

In a statement, Senate President Teresa Paiva Weed said, “While I did not initiate this grant in 2003, I have supported the Newport County Chamber of Commerce’s efforts over the years to support the defense industry.” She said the defense industry employs 16,000 people and supports 33,000 jobs in Rhode Island, accounting for 6.4 percent of the state’s employment.

“It is not just that the Navy is one of Aquidneck Island’s largest employers. It is an entire ecosystem of defense industries employing many thousands of Rhode Islanders in quality, well-paying jobs,” the statement continued. “The industry continues to be strengthened through the investments and partnerships we have forged over the years, and it is imperative that we continue to nurture the defense industry in Rhode Island.”

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