Treasurer Diossa Unveils His “Investing in Rhode Islanders” Framework

Published on Tuesday, January 23, 2024

Providence, RI – Today, Rhode Island General Treasurer James A. Diossa unveiled his “Investing in Rhode Islanders” framework during a roundtable meeting with community stakeholders. The framework consists of the following priorities: the Secure Choice Act, a Crime Victim Compensation Program package, and the Rhode Island Baby Bond Trust Act.

Roundtable participants included: Catherine Taylor, State Director, AARP. Oscar Mejias, CEO, The Rhode Island Hispanic Chamber of Commerce. Kristina Contreras-Fox, Director of Policy, Rhode Island Black Business Association. Peg Langhammer, Executive Director, Day One. Vanessa Volz, Executive Director, Sojourner House. Dr. Darrick Hamilton, Professor of Economics and Urban Policy, The New School. Nina Harrison, Policy Director, The Economic Progress Institute.

You may watch the full roundtable here.

“The best return our State can receive is from investing in our people,” said General Treasurer Diossa. “I have spoken with folks throughout Rhode Island and have thought strategically on what we can do to champion opportunity for all. With the Secure Choice Act, we are making sure private sector employees have the necessary funds for a comfortable retirement. With the Crime Victim Compensation Program package, we are easing the financial burden that victims face during one of life’s hardest and often unexpected moments. Lastly, with the Baby Bond Trust Act we are establishing a foundation for economic opportunity for all children in the Ocean State by closing the wealth equity gap. These are the investments that we should make to ensure all Rhode Islanders can reach their full potential.”

SECURE CHOICE

The Rhode Island Secure Retirement Savings Program Act – better known as Secure Choice – would create a retirement savings plan for private sector employees who are not currently offered a retirement savings option by their employer. Administered by the Office of the General Treasurer, Secure Choice creates a convenient and low-cost way to help ensure Rhode Islanders are financially secure in retirement. Employee participation is voluntary, and contributions are made to an individual retirement account through payroll deductions. Savings plans are portable, so if an employee switches jobs, the plan will follow them. This bill is modeled after successful legislation enacted in 19 other states, including Illinois, Connecticut, Virginia and California.

“AARP’s mission is to empower people to choose how they live as they age, and adequate retirement savings are critical to achieving that goal,” said Catherine Taylor, AARP Rhode Island State Director. “Currently 172,000 Rhode Island workers do not have access to a retirement savings vehicle through their work that will allow them to build towards a secure retirement. All Rhode Islanders need a way to save and that is why passing Secure Choice is so important.”

“Direct investments in Rhode Island's future towards building financial security and personal wealth will help generations of Rhode Islanders live the American Dream of home ownership, earning a degree, retirement savings, and starting a business,” said Weayonnoh Nelson-Davies, Economic Progress Institute, Executive Director. “I fully support Treasurer Diossa's leadership to support a Secure Choice retirement program and make investments in Baby Bonds. These are both transformational ways to improve equity in Rhode Island by lifting families out of poverty and reducing the racial wealth gap.”

“If passed, Secure Choice will help small businesses hire and retain talented workers. Sole proprietorships and microenterprises, which make up 92% of all minority-owned businesses, can also opt into the program thus allowing the smallest businesses to offer competitive benefits on the same level as the largest corporation,” said Kristina Contreras Fox, Rhode Island Black Business Association, Director of Policy. “Furthermore, this bill will further close the racial wealth gap since minority Rhode Islanders can access a way to build savings for retirement. Currently, 54% of all Black households and 67% of all Latine households are at risk of having $0 in retirement savings—a statewide disaster in the making.The impact of this legislation will be growing local companies, more jobs created and filled by local workers, more money into the Rhode Island economy, and more Rhode Islanders able to meet their needs without use of safety net resources. That's the growth we need to see. It's time to pass the RI Secure Choice Retirement Savings Act!”

CRIME VICTIM COMPENSATION

The Crime Victim Compensation Package aims to make the Crime Victim Compensation Program more accessible for victims of violent crime. Administered by the Office of the General Treasurer, the Crime Victim Compensation Program has helped thousands of innocent Rhode Islanders cover the financial cost of crime. In cooperation with legislative partners, these bills would:

  1. Reduce eligibility barriers for victims of sexual assault by allowing them to submit the results of a medical forensic exam performed by a licensed health care provider in lieu of a police report;
  2. Help victims feel more comfortable in their home by permitting them to use up to $1,000 of their total award to make reasonable modifications to their residence, such as re-keying a lock or purchasing a security camera;
  3. Expand Program eligibility by allowing hit and run victims who suffer serious bodily injuries – currently excluded under law – to qualify for up to $25,000; and
  4. Ensure Treasury continues to have the ability to offer meaningful financial assistance to those that have undergone a criminal ordeal through implementation of an additional $1.00 fine on traffic violations (excluding parking violation) that would help to fund the Program.

“As a victim services agency, we at Sojourner House wholeheartedly support the legislative efforts to broaden victim compensation funds to sexual assault survivors,” said Vanessa Volz, Sojourner House, Executive Director. “It sends a powerful message that survivors and victims deserve equitable access to these critical resources, which can help them to rebuild their lives with the support they need.”

“We are excited to work with the General Treasurer on the introduction of this package of bills focused around the Victim’s Compensation Program. Victim’s Compensation allows victims access to financial support for any costs associated with crimes committed against them,” said Peg Langhammer, Day One, Executive Director. “Under the proposed legislation, Day One particularly expresses its enthusiasm for the potential expansion of victim access to compensation funds. Notably, sexual assault victims will now have the opportunity to access these funds upon completion of a medical forensic examination, eliminating the requirement for a police report. Dealing with the aftermath of a sexual assault can be an incredibly daunting experience, and victims may not be prepared to take immediate action with law enforcement. Recognizing this challenge, the initiative proposes a groundbreaking change—allowing victims to utilize a medical sexual assault forensic examination by a healthcare provider in lieu of a traditional police report. This innovative approach is expected to empower more victims to seek the financial support they need during a difficult time.”

BABY BONDS

The Rhode Island Baby Bond Trust Act represents a long-term investment in the future of our State that will spur economic development while helping to close the generational wealth gap. The Act would create a $3,000 trust for each Rhode Island child born into a family receiving public health insurance (Medicaid). Using its financial expertise, these trusts would be managed and invested by the Office of the General Treasurer in cooperation with third-party managers until the child reaches their 18th birthday. On turning 18, the child would be able to use the Trust and accrued interest to: (a) pursue higher education or vocational training in Rhode Island, (b) purchase a home in Rhode Island, (c) start a business with a principal place of business in Rhode Island, or (d) purchase a vehicle in Rhode Island. Assuming a conservative rate of return, each child would receive around $12,000 to $15,000 under the Program that would be spent in Rhode Island and generate new economic activity.

“The source of wealth inequality is structural, not behavioral. Baby Bonds will position young adults with capital to purchase a wealth-generating asset like a home, a new business or a debt-free college education or skill training - investments that will passively appreciate over a lifetime,” said Dr. Darrick. Hamilton, The New School, Henry Cohen Professor of Economics and Urban Policy. “We applaud Rhode Island's leadership in considering Baby Bonds, a transformational investment for a more inclusive, equitable, and productive future.”