The city of Providence will pay an additional $15 million to its public schools, staving off a budget crisis that threatened to disrupt student amenities like sports and bus passes in the coming months, under the terms of an agreement reached this week with the Rhode Island Department of Education (RIDE).
Details of the settlement announced just after noon Friday call for retroactively paying $4 million to cover fiscal year 2024’s deficit, and adding $11 million in city aid to schools for this fiscal year, which ends June 30, 2025. That effectively makes the city’s total contribution to its schools $146.5 million in fiscal 2025, compared to the original $135.5 million budgeted.
RIDE Commissioner Angélica Infante-Green praised the settlement as a step toward fulfilling the city’s legal obligations to fund its schools, which have been under state control since 2019.
“This year, we want to speak directly to families and students and share that they can be at ease,” Infante-Green said during a press conference Friday afternoon at Providence Career & Technical Academy.
The school system will receive its first check, worth $5 million, within five days of City Council approval of the settlement, Providence Mayor Brett Smiley told reporters at a separate press event Friday afternoon.
The settlement specifies the city remit $8 million in escrowed payments, held last month at Infante-Green’s request, to be directed to the schools. How the city will round out the $15 million package will require some additional “budget savings” yet to be determined, Smiley said. So far, he said $1 million in revenue from payment of lieu of taxes agreements with nonprofits, and another $3 million in virtual net metering credits for the district’s utility bills.
The city’s remaining pandemic relief dollars will be devoted to “revenue recovery,” Smiley said.
“This funding fight, which predated me, has been going on since 2019, has been a major, major hurdle for us being able to work together in a collaborative and cooperative fashion,” Smiley told reporters. “I’m hopeful that now that it’s resolved…that we can now all focus on the task at hand, which is delivering better results for the students of Providence.”
But in October, Smiley initially bucked when the Providence Public School Department (PPSD) pleaded for an additional $11 million to cover budget shortfalls. Smiley and the City Council offered $2.5 million to ease the pain, but the courts ultimately sided with the state. Rhode Island Superior Court Associate Justice Jeffrey A. Lanphear ruled on Nov. 8 that the state-controlled Providence Public School Department (PPSD) is eligible for millions more in local funding.
City and state officials came to an agreement at the eleventh hour. A court hearing that was supposed to start at 10 a.m. on Wednesday was delayed for several hours while city and state representatives met in a separate conference room. When Lanphear took the bench a little before 1 p.m., he announced a settlement had been struck.
The $11 million payment for this fiscal year will prevent cuts to winter and spring sports as well as student bus passes. Providence Superintendent Javier Montañez, who spoke to reporters alongside Infante-Green Friday afternoon, said the proposed litany of cuts — originally announced at an Oct. 9 school board subcommittee meeting — were never ultimatums but real possibilities.
“This was actually what was going to happen,” Montañez said. “This wasn’t a threat. This was true.”
Still, Infante-Green noted, the extra cash this year essentially bandages district finances, but will not salve the underlying wound.
“This is going to close a structural deficit,” she said. “This is not that the district is going to be now in a financially plush place. But it is a step in the right direction.”
Under the agreement, Providence pledged $147 million in school funding for fiscal years 2026 and 2027. In the latter year, the city is liable to pay adjustments tied to growth of education aid statewide. That proportionate boost in municipal funding, and the settlement in general, align the city more closely with the mandates of the Crowley Act. The 1997 state law that dictates the terms of state takeovers of school districts and municipalities’ obligations to fund those public schools.
No midyear tax increase
The details of the settlement were made public less than 24 hours after City Councilors OK’d Providence’s new comprehensive plan, a master document two years in the making. Smiley signed the plan Friday afternoon outside the West Broadway Neighborhood Association — located down the street from Providence Career & Technical Academy, where Infante-Green spoke to reporters just an hour later.
After signing the comp plan, Smiley asked reporters if there were any questions about it. Silence followed. Smiley then began taking questions about the settlement.
His answers suggested the consequences are less cataclysmic than he first suggested in a Nov. 12 press conference, when it was estimated the city might be on the hook for up to $55 million.
The mayor promised again Friday no midyear tax increases for Providence would happen. But Smiley said he anticipates a tax increase in excess of the state-mandated 4% cap will be in his proposed fiscal 2026 budget that will come out in April. An increase over 4% would require approval from the General Assembly, although Smiley said such a maneuver would be a one-time request.
Two progressive Democratic legislators, however, took to social media to preemptively squash that idea.
“If he tries that, I’ll sure as hell refuse to sign it,” wrote Providence Democratic Sen. Sam Bell on X Wednesday.
Asked about legislative opposition Friday, Smiley said, “I’ll make my case to members of the General Assembly whether they’re from Providence or not.” “I won’t be putting all of this new funding on the shoulders of taxpayers in Providence,” Smiley continued. “I understand that families are strained. This means higher property taxes, it means higher rents, it means higher cost of business. And so it’s not fair to put that exclusively on them.”
“We’re going to share this burden, but it’s important that we properly fund our schools, and most of the constituents that I’ve spoken to are very willing to pay more taxes for better schools.”
Rep. Enrique Sanchez, also a Providence Democratic, was skeptical. He reposted a video Friday of Smiley discussing the tax proposal, adding “That’s right. We won’t support his tax increase proposals. Providence taxpayers shouldn’t pay for the consequences for his incompetence.”
In the meantime, the city has rolled out a series of cost-saving measures, including a hiring freeze and the suspension of discretionary spending, both of which will last through June 30, 2025. But the settlement’s preclusion of an exponentially higher payment led Smiley to assure residents that services like libraries and recreation would go unaffected — a major concern for the former before news of the settlement broke, with the city library leaders even penning a letter to Infante-Green. Providence Police and Fire academies will continue as planned, Smiley said.
Smiley said Friday afternoon that he continues to strategize a return to local control for the capital city’s schools. That would mean release from the Crowley Act’s harsher stipulations, and it would also empower a fresh Providence school board — now half-elected and half-appointed, and expected to take office early next year. Currently, the school board has no power over budgeting decisions, and money matters reside with the state alone.
In August, RIDE extended its takeover by up to three years, thanks to an affirmative vote by the state’s Council on Elementary and Secondary Education. Could the takeover end sooner?
A succinct Infante-Green said Friday afternoon, “We’ll see.”
This story was published originally in the RI Current on November 22, 2024.
Alexander Castro covers education and health for Rhode Island Current. He has worked extensively in the visual arts as a critic, curator and adjunct professor. Rhode Island Current is part of States Newsroom, the nation’s largest state-focused nonprofit news organization.
