Media release

Rhode Island Foundation releases recommendations for spending $1.1 billion in American Rescue Plan Act funding

Announcement caps a six-month-long, rigorous research and public input process to identify “big ideas” with long-term benefits, especially for those impacted the most by the pandemic, to guide decision-making by state leaders

The Rhode Island Foundation today released recommendations for spending $1.1 billion in broad stimulus funding the state is receiving from the federal American Rescue Plan Act. The announcement comes as the Foundation and its partners wrap up six months of research and public input into Make It Happen: Investing for Rhode Island’s Future, which studied and analyzed options for spending the federal COVID-19 recovery funding over the next three years.

"This huge infusion of federal funding offers leaders a once-in-a-lifetime chance to positively change the direction of the state and to focus on tackling pre-existing challenges exacerbated by COVID-19. The recommendations we’ve outlined via Make It Happen: Investing for Rhode Island’s Future have the potential to equitably address decades-long challenges, produce benefit for all Rhode Islanders and specifically assist those hardest hit by COVID-19.”

- Neil D. Steinberg, Foundation president and CEO

The recommendations were developed with the support of the Economic Progress Institute (EPI), the Rhode Island Public Expenditure Council (RIPEC), robust public input and a diverse 15-member steering committee following a set of guiding principles that focused on equity, sustainability, impact and process.

The findings will be shared with Gov. Dan McKee and the Rhode Island General Assembly to inform their decisions.

“I thank the Rhode Island Foundation and its partners for contributing these recommendations to the public dialogue,” said Governor Dan McKee. “As Rhode Island emerges from a once-in-a-century public health crisis, we have a once-in-a-generation opportunity to build a more resilient, prosperous, and equitable state for all. We will closely review the recommendations put forward by the Foundation and evaluate them in the context of the 2030 policy framework that our Administration recently released.”

“We thank Neil Steinberg and the Rhode Island Foundation for their leadership efforts and their collaboration with so many talented professionals to develop insightful suggestions on how to best invest these federal funds. The House and Senate Finance Committees will carefully review all of the proposals in a very public and transparent manner as we ensure our state makes the proper investments for a brighter future."

- Speaker K. Joseph Shekarchi and Senate President Dominick J. Ruggerio

The report recommends investing in six key areas: housing, behavioral health, workforce development, small business, neighborhood trusts and immediate relief.

The recommendations were developed in alignment with four guiding principles:

  1. Equity
    Recommended investments will address the root causes and conditions of systemic inequalities based on race, gender, disability, economic status, and other historically marginalized or oppressed communities which predated and were exacerbated by the COVID-19 pandemic.
  2. Sustainability
    Recommended investments will deliver enduring change and solutions that enhance the resilience of impacted communities.
  3. Impact
    Recommended investments will transform economic opportunities and quality of life, and build community assets for impacted communities for the short and long term.
  4. Process
    Recommended investments will reflect both broad input from impacted communities and public stakeholders, as well as solid data and research.

“The focused use of these funds over the allowed time frame has the potential to be life-changing for many Rhode Islanders. And, allocation of the funding is only the first step. Planning and implementation, capacity and oversight are critical to success,” said Steinberg.

The public input included approximately 400 ideas submitted by the public via email, stakeholder conversations with more than 140 people, five focus groups with Rhode Islanders from communities hardest hit by COVID and 11 nonprofit-led, community visioning sessions throughout the state.

“The work this widely diverse steering committee did together, respecting each other’s opinions and ideas, and coming to consensus was both impressive and important,” said Steinberg. “In addition, while there were some debates along the way, they really listened to each other and learned from each other, closely examining values and priorities and considering the needs/ideas of all our communities.”

Both EPI and RIPEC contributed policy analysis, and significant research and data collection efforts to Make it Happen, after contracting with the Foundation last spring to assist in this effort. RIPEC is a public policy research organization focused fiscally responsible government and competitive tax policies. EPI is a nonprofit research and policy organization that focuses on the impact of economic policies on low- and modest-income Rhode Islanders.

“RIPEC deeply appreciates the opportunity to work with the Economic Progress Institute and the Rhode Island Foundation, and with a distinguished and diverse group of steering committee members, in formulating recommendations for these once-in-a-generation federal funds,” said Michael DiBiase, RIPEC’s president and CEO. “The recommendations recognize the one-time nature of these funds in making bold, comprehensive investments in critical areas of need that will substantially improve the quality of life in our state.”

“This has been an invigorating process. We appreciated working with the Foundation and RIPEC and especially with the steering committee comprised of people with diverse backgrounds and passions,” said Linda Katz, EPI’s co-founder and policy director. “We are pleased that equity was centered in the committee's work and recommendations. We hope this process sets an example for how we can work together to plan for and implement the investments and policies needed to ensure economic prosperity for all Rhode Islanders.”

The Make It Happen report does not examine or make recommendations for uses of other buckets of earmarked ARPA funding, such as the $542 million for local cities and towns, the $400 million for K-12 education, the $168 million for higher education and the $112 million capital project fund.

“There must be collaboration and coordination in use of the funds between cities and the state to achieve the best outcomes for their residents. Similarly, while each recommendation-area addresses an individual component of need, the areas are interrelated,” said Steinberg. “There should undoubtedly be opportunities to maximize and leverage these additional interrelated investments in coordination with our recommendations.”

The recommendations in the report are briefly outlined here:

HOUSING $405 million

The goals and recommendations address the decades-long acute shortage of housing in Rhode Island, especially for people with low-to-moderate incomes.

GOALS: Provide at least 5,150 units of affordable housing to Rhode Islanders by investing in affordable rental housing, permanent supportive housing, and homeownership opportunities; remediate lead paint for at least 2,850 units; and renovate and/or repair code violations for at least 4,000 homes.

RECOMMENDATION 1: Invest $200 million for affordable rental housing production and preservation.

RECOMMENDATION 2: Invest $50 million to build 500 units of permanent supportive housing and provide temporary housing for targeted populations.

RECOMMENDATION 3: Invest $50 million to expand first-time home buyer programs to increase home ownership opportunities for Black, Indigenous, and People of Color (BIPOC) populations and/or in areas disproportionately impacted by COVID-19.

RECOMMENDATION 4: Invest $100 million for healthy homes repairs, including the remediation of lead paint and assistance to low-income homeowners and qualifying landlords for renovations to substandard units for code compliance.

RECOMMENDATION 5: Invest $5 million to develop a strategic plan and to improve capacity and expedite processing of housing projects that are accessing ARPA funds.

BEHAVIORAL HEALTH $255 million

The goals and recommendations address the well-documented, ongoing, epidemic among those battling mental health and substance abuse challenges.

GOALS: Decrease statewide emergency department visits by children and adults for acute behavioral health crises by 20 percent each; decrease the number of unintentional opioid overdoses and suicides by 15 percent each; increase the number of RI licensed outpatient mental health counselors, social workers, psychologists, and psychiatrists to reach New England’s behavioral healthcare occupational median.

RECOMMENDATION 1: Invest $170 million to build new facilities and renovate and upgrade existing facilities to expand and improve services and treatments across the behavioral health continuum of care.

RECOMMENDATION 2: Invest $50 million in technology infrastructure, including electronic medical records and other non-facility infrastructure, including one-time investments in mobile response and stabilization services, and technology that could increase the availability and access to telemedicine.

RECOMMENDATION 3: Invest $30 million to increase provider capacity through a loan forgiveness program, as well as stipends/bonuses, to recruit and retain behavioral health professionals. The program should target BIPOC populations to build a culturally and linguistically diverse behavioral health workforce.

RECOMMENDATION 4: Invest $5 million to complete a strategic plan for a behavioral health system of care for adults and children.

WORKFORCE DEVELOPMENT $205M

The goals and recommendations that follow aim to address the fact that businesses of all sizes in Rhode Island are facing worker shortages, while many residents remain unemployed or underemployed and encountering barriers to employment, such as lack of affordable childcare.

GOALS: Provide 15,000 Rhode Islanders with high-quality jobs through robust training, adult education, workforce skills services and the elimination of barriers to employment.

RECOMMENDATION 1: Invest $150 million in high-quality “earn and learn” job training programs that lead to a promotion, certificate, academic credential and/or higher salary.

RECOMMENDATION 2: Invest $30 million in high-quality and accessible adult education/foundational workforce skills including English language, literacy and digital skills.

RECOMMENDATION 3: Invest $15 million for one year to continue and expand the RI Reconnect initiative that provides assistance to individuals to mitigate barriers to participation in a job training or employment opportunity.

RECOMMENDATION 4: Invest $10 million in IT data structure improvements to the state’s longitudinal data system and support a plan for long-term sustainability of that system.

SMALL BUSINESS $100M

The goals and recommendations recognize that, as the backbone of Rhode Island’s economy, small businesses require significant additional support to sustain and grow their businesses.

GOALS: Provide significant financial assistance to at least 2,250 small businesses, targeted to minority-owned businesses, through forgivable loans, low-interest loans and grants.

RECOMMENDATION 1: Invest $50 million in Rhode Island small businesses and cooperatives through forgivable loans.

RECOMMENDATION 2: Invest $35 million to provide technical assistance to small businesses by awarding one-time grants for business services through a newly established business resource network.

RECOMMENDATION 3: Invest $10 million to create a new Community Development Financial Institution (CDFI) or expand capacity of one or more existing CDFIs to provide financing for projects in distressed and underserved neighborhoods in Rhode Island.

RECOMMENDATION 4: Invest $5 million to establish a loan program for certified Minority Business Enterprises (MBEs).

NEIGHBORHOOD TRUSTS $50M

This recommendation suggests that investments, directed by residents in places whose populations and communities have been impacted most by the pandemic may prove to make a significant, innovative impact for those living in a Qualified Census Tract.

RECOMMENDATION: Invest $50 million for the creation of Neighborhood Trusts in Qualified Census Tracts.

IMMEDIATE RELIEF $50M

The recommendation recognizes that there is a continued short-term need to support those most impacted by COVID-19.

RECOMMENDATION: Invest $50 million in Rhode Island nonprofit organizations to provide immediate relief to residents suffering from behavioral health disorders; economic, food and housing insecurity; lack of affordable childcare and domestic violence, exacerbated by the COVID-19 pandemic.

IMPLEMENTATION, CAPACITY, ACCOUNTABILITY, and OVERSIGHT

RECOMMENDATION: We recommend that an office be established within the Governor’s Office and reporting directly to the Governor with the authority to oversee the recommended spending of ARPA funds pursuant to clear goals, performance metrics, and transparency. The critical responsibilities of this office would include ensuring that funds are expeditiously used and oversight of expenditures. This office would need additional staffing for the expenditure period and would coordinate with legislative input and oversight.

The Rhode Island Foundation is the largest and most comprehensive funder of nonprofit organizations in Rhode Island. Working with generous and visionary donors, the Foundation raised $68 million and awarded a record $87 million in grants in 2020. Since its centennial five years ago, the Foundation has awarded more than $284 million in grants and has raised more than $328 million. Through leadership, fundraising and grant-making activities, often in partnership with individuals and organizations, the Foundation is helping Rhode Island reach its true potential.