Shelter beds at risk in R.I. if state doesn't fill housing budget gap, advocates warn
Luis Negron stood in the State House rotunda Tuesday afternoon among a crowd of 250 with his 2-year-old daughter Mia atop his shoulders holding a sign that said 'shelter was my lifeline.'
Negron said that two years ago he, his partner, and then 3-month old daughter were evicted from their apartment and had to sleep in their car.
'We didn't know what to do,' he said in an interview inside the State House. They eventually connected with the Providence-based social service organization Amos House which got them into a shelter. Now his family lives in permanent supportive housing.
Advocates fear Rhode Island's unhoused community could lose such critical lifelines if lawmakers fail to address a $17.8 million budget shortfall for homelessness services as they finalize the fiscal 2026 budget. Which is why Negron and his family were at the State House Tuesday afternoon, joining others in urging state leaders to fill that gap.
'Unfortunately, there's not enough money for everything that has to happen in our state,' Eileen Hayes, CEO of the Providence social service organization Amos House, told the crowd. 'But people whose lives are at risk should not be the ones that have to forfeit their needs.'
Federal pandemic money has allowed Rhode Island to more than double its number of shelter beds since 2020, but with that funding now gone, advocates fear as many as 926 beds could be lost statewide.
'We need shelter beds to stay open while we build affordable housing for all,' Hayes said.
According to the state, advocates' projections rely on outdated numbers. Rhode Island Department of Housing spokesperson Emily Marshall pointed to a request for proposals for homeless service providers issued by the state on May 7 which 'anticipates provider savings' which would reduce the number of beds that may have to come offline should the state not plug the department's budget.
Marshall did not immediately provide an estimate on how many shelter beds the state would have to reduce.
'We remain committed to maintaining emergency shelter access within available funding while strategically investing in long-term solutions like affordable and permanent supportive housing,' Marshall said in an email Tuesday.
The state's shelter dashboard notes a total of 1,514 beds available across the entire state, with 181 unused as of May 23.
Advocates are urging state lawmakers to consider new taxes to help cover provider costs, including a tax on second homes, a higher real estate conveyance tax on property sales over $800,000, and increased income contributions from the state's highest earners.
They are also calling on the General Assembly to approve Gov. Dan McKee's budget proposal to fund shelter beds by extending the state's 5% hotel tax to include short-term rental homes.
McKee's recommended fiscal year 2026 budget calls on the state to eliminate the exemption whole-home short-term rentals have from the state's 5% hotel tax starting Jan. 1, 2026. The governor projects an annual revenue of roughly $5 million.
Advocates supported a similar proposal McKee introduced as a budget amendment in 2024, but the General Assembly ultimately replaced it with its own $46 million plan which relied on remaining pandemic relief aid. The governor's plan also faced competition from municipalities that have historically received a quarter of the revenue from the state's hotel tax.
Municipal interests are again vying for that expanded share of the fiscal pie.
Legislation introduced by Sen. Matthew LaMountain, a Warwick Democrat, would maintain that existing split to towns, if McKee's proposal is approved.
Rep. Lauren Carson, a Newport Democrat who chairs a legislative panel studying short-term rentals, has again proposed returning all of the revenue generated by a hotel tax on short-term rental houses exclusively for municipal infrastructure.
'If we don't have infrastructure and the stormwater not running and toilets not working, then the tourists ain't coming,' she said in an interview.
And the potential tax revenue could always go toward funding homeless services, Carson said, it would just be up to the municipalities rather than the state.
'Newport is perfectly qualified to make decisions on homeless shelters and how to assist homeless people,' she said.
Keeping housing decisions local is a preference of the Rhode Island League of Cities and Towns, whose executive director said a cookie-cutter approach will not work with each municipality.
'Not one of my 39 communities are all the same, they're all unique,' Randy Rossi, executive director of the league, said in an interview. 'What Burrillville might need, Westerly may need something completely different.'
Kimberly Simmons, executive director for the Rhode Island Coalition to End Homelessness, said she would prefer any potential revenue from the tax expansion end up in state coffers.
'The state has the ability to get it out evenly,' Simmons said in an interview.
Carson's bill was heard before the House Committee on Finance on May 13 where it was held for further study, as is standard procedure for an initial vetting by a legislative panel. Companion legislation sponsored by Sen. Victoria Gu, a Westerly Democrat, was held by the Senate Committee on Finance on March 4.
House Speaker K. Joseph Sheakrchi has not taken any official stance, but said he will continue to prioritize addressing homelessness in the final budget.
'In recent years, the General Assembly has gone above and beyond the Governor's budget requests for homeless assistance,' he said in a statement. 'Despite an extremely challenging budget year, homelessness will remain a priority of the legislature.'
At least 2,442 unhoused people across Rhode Island were counted when volunteers conducted an annual survey in late January 2024 — up 35% from the 2023 count. The coalition conducted the annual Point-In-Time count for the U.S. Department of Housing and Urban Development this year on Jan. 28, but results aren't expected to be released until some time in the summer.
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