PROVIDENCE, R.I. — Better-than-expected state revenue forecasts have led Rhode Island's governor to back away from a proposal to eliminate dental care for adults on Medicaid.
The good fiscal news also led Gov. Lincoln Chafee to reduce the magnitude of his proposed meals tax increase. He had sought to raise the tax from 8 percent to 10 percent but is now proposing to raise it to 9 percent.
When he offered the proposals in January, the independent governor said he hoped to revise them this spring if projections indicated that state revenues would increase. Earlier this month, state budget experts said Rhode Island can expect to take in tens of millions more this fiscal year and next.
Chafee detailed the changes to his budget proposal in a letter sent Thursday to the leaders of the House and Senate budget committees.
Public health advocates and others who opposed Chafee's call to eliminate adult dental services cheered his change of heart. The dental services cut would have backfired had it been implemented, said Linda Katz, policy director at the Economic Progress Institute, an organization that advocates for programs for low-income residents.
"People would have ended up in emergency rooms where it costs much more to address their problems," Katz said Monday.
Restaurant industry leaders said they would continue to fight any proposal to increase the meals tax. The proposal faces widespread opposition in the General Assembly.
Chafee wants to use revenue from the meals tax increase on public schools. But restaurant owners have voiced strong opposition to the measure, saying it will hurt business and drive customers to restaurants over the state line, where meals taxes are lower.
"Any tax increase is a step in the wrong direction," said Dale Venturini, president and chief executive of the Rhode Island Hospitality Association. "We're already at a competitive disadvantage."
The fate of Chafee's budget proposals will be decided in the next few weeks when state lawmakers are expected to vote on a budget for the next fiscal year.