$40M bond package sparks controversy

Posted 12/27/23

A resolution to bring a $40 million bond for Cranston Public Schools before voters in a special election next year has passed in the city council in a 6-3 decision along party lines.

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$40M bond package sparks controversy


A resolution to bring a $40 million bond for Cranston Public Schools before voters in a special election next year has passed in the city council in a 6-3 decision along party lines.

The resolution which was put forward at the full City Council meeting on Dec. 18 would support a legislative act of the Rhode Island General Assembly enabling Cranston to seek approval from voters for the bond. This finance committee unanimously approved the resolution, with bi-partisan sponsorship from Democrats Council President Marino, and Councilman Donegan and Republican Councilwoman Nicole Renzulli. Councilors Germain, Wall, Ferri, and Vargas also asked to co-sponsor.

Councilwoman Renzulli would go on to vote no on the resolution she sponsored.

The legislation this resolution would support, which has been written about in previous editions of the Herald, would provide funding for several CPSED projects, including the completion of the new Gladstone Elementary building and the purchase and renovation of the building housing the Apprenticeship Exploration charter school. A central pillar of the resolution is the expectation of reimbursement from the Rhode Island Department of Education at an expected rate of 74%, including 74% of interest accrued. This number, while anticipated, was never absolute, and is subject to change due to a number of factors, including the length of time it will take to issue the bond. The 74% reimbursement rate is scheduled to expire on June 30, 2024.

In the original language of the legislation, the bond would be issued contingent on a reimbursement of no less than 70%. However, before putting the final resolution to a vote at the  December 18 city council meeting, Council President Jessica Marino asked for an amendment to be made to the language of the legislation, changing the reimbursement to no less than 50%.

“This way we are not handicapped going forward in terms of borrowing money with respect to the reimbursement rate,” Marino said at the city council meeting. “All indicators are that the reimbursement rate would be higher than that but it’s best to play it safe.”

City Council Legal Counsel Stephen Angell further explained the need for this change moments later. “If the (Rhode Island Department of Education) comes back and says we’ll only reimburse at 67%, you’re dead, you can’t borrow the money because the bond act says 70% and over, that’s the reason for the change. So if RIDE comes back and says 74% great, if RIDE comes back and says 51% great, if RIDE comes back and says 49%, you can’t do it.”

Following this, councilors Renzulli spoke, reaffirming that this bond would not be used to purchase the apprentice school for $10 million more than it was worth, a rumor which the Herald has also written about previously. Councilor Paplauskas then asked city council legal counsel whether the change from 50% to 70% represented a “substantive change” requiring the resolution return to committee to be further renegotiated. Counsel replied with a simple “no.”

Chief of Staff for the mayor Anthony Moretti did not agree. Following this question, he took the podium stating that the administration’s stance would be that this was, in fact, a substantive change.

After some further discussion, the resolution was put to a vote. Councilors Renzulli, Paplauskas, and Campopiano voted no. Everyone else voted yes. The resolution passed with the amended language of no less than 50%.

The following day, Councilwoman Renzulli sent out a press release criticizing what she calls Council President Marino’s “domineering tactics.” The release claims the change was made without the transparency promised by Marino and councilman Donegan, who chairs the finance committee.

Renzulli writes “I was one of the three sponsors of the original resolution and I have publicly defended the resolution, but I was not even consulted by the Council President to change the reimbursement formula without any discussion of the impact on taxpayers and the City’s debt service ability.”

The release further reasserts the Moretti’s stance that the language constitutes a substantive change to the resolution. It points out that City Finance Director Thomas Zidelis was not present at the meeting and that no one present could explain the financial impact of a potentially lower reimbursement rate.

Councilman Paplauskas said, “Let me be clear. I fully support the schools, but I do not support the process and lack of transparency. We were never given the option to ask the Finance Department if the City can afford the bond at the lesser reimbursement rate.” Paplauskas emphasized, “My first duty is to protect the taxpayers of Cranston.”

Following the receipt of the release, in an interview with the Herald, Chief of Staff Moretti said that the Mayor and his administration still support the bond act, but that the modification from 70% to 50% was a “shocking change.”

He says “It’s very peculiar, the process was transparent before but the change was done behind closed doors. I think it deserves greater scrutiny to understand why that change has taken place.”

Council President Marino later responded to the release, calling it “nothing more than petty partisan politics, which is disappointing to say the least.”

Marino points out that this change of language is consistent with that of the $147 million bond resolution presented to the general assembly in 2020. That proposed legislation also read “no less than 50%” with respect to the reimbursement from RIDE. She further points out that despite the 50% lower limit, the city still received the 74% reimbursement rate they expected.

She writes “Let me be clear, this is standard reasonable, prudent, responsible language, to have the minimum threshold of 50% as the city has consistently done in its previous school bond act under the previous administration and this language still enables the city to receive 74% reimbursement.”

She wrote “What transpired last evening at the council meeting was nothing out of the ordinary and comported with normal rules and procedure. To suggest otherwise is simply wrong and inexplicable.”

She continued. “As for commentary about looking out for the city’s finances and the taxpayers of the city of Cranston, I and my Democratic colleagues are absolutely doing precisely that. The city council corrected the bond act language consistent with past practice, and ultimately, it will be up to the voters, just as it has been in the past to determine if the city will avail itself of this opportunity to improve our schools as we hope to once again achieve a 74% reimbursement rate from RIDE.“

Councilman Donegan wrote a statement as well.

The issue of additional bonding to support our Cranston Public Schools was discussed at great lengths on numerous occasions in the Finance Committee; meetings which are recorded and available to the public online thanks to an Ordinance introduced by City Council Democrats, and passed by the City Council. As represented before the City Council and the public at each meeting, we anticipate a reimbursement rate of 74%; nothing about the amendment to the bond language changes that. If the bond is approved by the voters of Cranston, further discussions will take place, in public meetings, such as the Finance Committee and budget hearings” he said.

Whether the language change was substantive or not, it will be moving to the general assembly. According to Moretti, if the general assembly approve a referendum, the decision of whether to authorize the bonds will go to Cranston voters in a special election early next year.


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