Supporting Small Businesses and Creating a Competitive Tax Environment

• Permanently eliminated the car tax in FY 2024.
• Championed reforming the tangible tax by signing legislation capping the rate at 2022 levels and creating a statewide exemption of $50,000, effectively eliminating the tax for 75 percent of Rhode Island businesses.
• Submitted a balanced budget for FY 2026 that closes an approximately $400 million deficit without any broad-based tax increases or cuts to critical services programs upon which Rhode Islanders rely.
• Repealed various nuisance fees – such as the liquor manufacturers duplicate fee and the sales-and-use tax exemption fee – that are a burden to residents and businesses paying them.
• Invested in the Small Business Assistance Program (SBAP), leveraging millions in loans from state appropriations since its inception. SBAP supports businesses with fewer than 200 employees that are having difficulty obtaining financing from traditional lending organizations, by capitalizing third-party lenders, including those with expertise in microloans, to provide access to capital. State funding is leveraged to provide access to additional lenders’ funds or provide technical assistance.
• Supported and renewed the Relief Grant (2021) and RI Rebounds (2022 – present) programs, which have provided more than 6,000 grant awards to small businesses and supported more than 1,000 businesses with ventilation, energy efficiency, technical assistance, and take it outside support.
  • Through the second phase of the RI Rebounds Technical Assistance program, provided direct services to nearly 1,000 Rhode Island small businesses, covering over 70,000 hours of service. This program provided support with legal, accounting, and business planning services as well as marketing and website development to help businesses grow and thrive in the state.

• Advanced the SupplyRI initiative, a program designed to increase in-state procurement by connecting large-scale purchasers (called Anchors) with local suppliers in Rhode Island and providing training to empower small and diverse suppliers to compete for business effectively. The FY 2024 and FY 2025 budgets enhanced funding for the program by $1.75 million. The program is poised to accelerate its focus on supplier readiness assistance, enabling businesses to grow and scale within the Rhode Island marketplace.
  • Helped facilitate $427 million in in-state procurement by fostering partnerships and expanding its Anchor network to include the growing offshore wind industry.
  • Continued to increase opportunities for diverse suppliers, with nearly 450 minority-, women- or veteran-owned businesses registered in the program.
• Deposited $100 million of SFRF into the UI Trust Fund, saving businesses $12.2 million and shoring up the fund in the event of a future downturn. The pandemic severely depleted the UI Trust Fund, leading to higher employer tax rates. This SFRF investment, combined with Rhode Island’s historic economic growth, has restored the fund to a stable and sustainable level.

• Directed $4.4 million into the Workers Compensation Fund to prevent an increase in the premiums paid by Rhode Island businesses.
• Ended the litter tax for small businesses.
• Provided Rhode Islanders with a rebate for the 4-percent gross receipts tax on their electric bills and 3-percent gross receipts tax on their natural gas bills between December 2023 and March 2024. This resulted in $35.6 million in total energy relief for families and businesses.
• Included three distinct programs in RI’s Innovation Initiative as of FY 2025.
  • Provided Innovation Voucher grants for small business research and development conducted in partnership with a local “knowledge provider” (typically an institution of higher education) or in-house for manufacturers. The maximum voucher award was increased from $50,000 to $75,000 in the FY 2024 budget. As of September 2024, 130 voucher awards have been made.
  • Through the Network Matching Grant program, supported intermediary organizations working to provide Rhode Island’s small businesses with technical assistance, access to capital, or space on flexible terms.
  • Added the Invention Incentive program to the FY 2025 budget to provide grants up to $5,000 to small businesses and individuals to reduce barriers to filing a patent application.

• Launched the Minority Business Accelerator program to support minority-owned businesses by offering partnerships to Minority Business Enterprises (MBEs) and Women’s Business Enterprises (WBEs) for technical assistance. The state also launched a competitive direct grant program to support MBEs and WBEs that successfully complete technical assistance.
  • Supported almost 1,000 businesses as of August 2024 through the Minority Business Accelerator’s technical assistance partnerships.
  • Partnered with DOA’s Division of Equity, Diversity, and Inclusion (DEDI) to help ensure eligible businesses are registered with the state as qualified WBEs/MBEs and reached out through intermediaries to recruit additional businesses to register.
  • Certified 61 small businesses through the MBE and WBE programs as of December 2024.
  • Launched a pilot program offering tailored technical assistance, pre-bid support, networking opportunities between businesses and buyers, and direct procurement training.
  • Allocated a budget of $500,000 to conduct a comprehensive and practical statewide disparity study. The study aims to assess the participation of minority, women, disadvantaged, and veteran vendors in state contracting. It will include an availability analysis to evaluate the presence of ready, willing, and able minority and women business enterprises within the Rhode Island market. The study is scheduled to begin in 2025. According to the statute, disparity studies must be completed every five years.