Everyone knows what the state of the city is. Providence Mayor Angel Taveras has already sounded the alarm loudly. But nonetheless, he’ll still deliver the annual speech tonight at 7 p.m. in the Council Chambers of City Hall.
The state of the city is, of course, disastrous. Rhode Island’s capital city is on the brink of bankruptcy and could literally run out of operating funds by June. Taveras, a progressive Democrat, has trimmed the deficit by shrinking the city staff and through tough contract negotiations with employees, but he’s still some $22 million in the hole.
Certainly in his speech tonight Taveras will reiterate that retired employees and tax-exempt non-profit landowners need to pony up in order for Providence to remain fiscally solvent, but it will be interesting to see which group he reserves the stronger rhetoric for.
To date, Taveras has had harsher words for the retirees, but there’s a reason for that. With them he has a lever by which he can compel the needed capital, namely receivership and the city’s new relationship with Bob ‘Scissor or Guillotine’ Flanders.
However, the real money is with the nonprofits.
Brown University already pays Providence more than $2.2 million a year. But the Ivy League school owns property that would be net $38 million if it weren’t exempt from paying property taxes and is sitting on an endowment of more than $2 billion and just approved another tuition increase. Brown can afford to pay the city more, and likely will. Same with Johnson and Wales. It’d be nice if RISD and PC would follow suit.
The hospitals, the other big tax exempt entities in the city, are another story. Together, the six profitable medical institutions in Providence own property that would be taxed at more than $44 million. They pay the city nothing.
And it’s not because they are hurting for cash. Lifespan, which runs four of those hospitals, paid its nine highest-earning executives more than $9 million in salary and bonuses. Their CEO alone made $2.9 million. And according to the nurses union at the hospitals, Lifespan has made $320 million in profits over the past six years.
Providence needs a share to share in the financial success of Brown and Lifespan. If it doesn’t, no matter how much Taveras and Flanders are able to wrestle away from retirees, it won’t make the state of the city any less ruinous.
Note: The mayor’s office plans to live tweet his speech. The mayor tweets using @angel_taveras and you can follow the tweets and add your own using the hashtag #pvdsotc.