Who wins? Who loses?

By DAVID SCHARFENBERG  |  December 29, 2010

There is, of course, anxiety about the added cost for consumers. But there is also a concern about the optics. A sales tax expansion might reinforce the state's reputation as a bad place to do business, just a year after the General Assembly slashed the top income tax rate in a bid to repair that image.

But with some on Smith Hill predicting a more modest expansion than Chafee has proposed — perhaps covering luxury goods beyond the means of the average voter — the final result may be something the business lobby can abide.

In the short term, the priority for many in the business community is the retention of Keith Stokes as executive director of the Rhode Island Economic Development Corporation.

During the campaign, Chafee was sharply critical of the EDC — particularly the loan guarantee it offered unproven video game company 38 Studios.

But keeping the economic development chief — who has strong support in the private sector and a champion in Senate President Paiva Weed — could send an important signal to the business lobby that the governor-elect will keep its interests in mind.

Development of a high-tech business sector in Providence on the land formerly occupied by Route 195 is also a priority. And there is some guarded optimism about Chafee's ability to manage that development.

That optimism owes much to Chafee's solid relationship with the incoming Providence mayor, Angel Taveras. The departing Carcieri and Cicilline administrations were not quite so cozy.


EDUCATION REFORM

It's a little remarkable, but the sexiest public policy issue in the land, these days, is education reform.

The phenomenon owes something to big-money philanthropists like Bill Gates and Eli Broad who have made a market-driven approach to overhaul — charter schools, data-driven evaluation of teachers, and the like — a defining cause.

It owes something to a Democratic establishment — from President Obama down to Rhode Island's own Smith Hill leadership — willing to do battle with the teachers unions.

And it owes something to a dynamic — and controversial — cohort of education leaders from Michelle Rhee, recently deposed from her perch atop the Washington DC schools, to the Ocean State's Deborah Gist.

But it is a movement that has its skeptics. Charter schools, after all, have a mixed record of success. And standardized testing is a flawed exercise. Chafee is among the skeptics. And his election has some in the local reform movement unsure about where the state might go from here.

Most observers say Gist, who still has three years left on her contract, will stick around. But Chafee, who had strong campaign support from reform skeptics like the National Education Association Rhode Island teachers union, is expected to make some changes to the Board of Regents for Elementary and Secondary Education, which sets policy.

Insiders say Chafee will almost certainly drop Regent Angus Davis, an important figure in the reform movement and a strong supporter of Chafee's gubernatorial rival Caprio. But what the new governor might do beyond that is unclear.

Chairman Robert G. Flanders, a strong supporter of Gist, may actually remain in place, some observers say. He and the governor-elect have a good personal relationship — Chafee, as a US Senator, recommended Flanders for a spot on the US First Circuit Court of Appeals. And in an interview with the Phoenix this week, Flanders said he would seriously consider staying in the position if Chafee asked him to serve.

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