General Treasurer Seth Magaziner had a surprise for the Warwick Rotary Club, although he didn’t let the cat out of the bag until he talked about his program to reunite individuals, businesses and even non-profits with unclaimed property. Since initiating the online program, findrimoney.com that Magaziner confesses sounds fake, more than $73 million has been reunited with its rightful owners.
Before joining the service club’s weekly Thursday Zoom meeting, Magaziner did a bit of online sleuthing, finding the club had $156 in unclaimed property. He vowed to get out a check.
Not strangely given the times, Magaziner opened his talk with the impact of the pandemic and why recovery of small business is critical to the state’s economy.
“Small business is absolutely vital to Rhode Island,” he said.
Before the pandemic he said nearly 99 percent of the businesses in Rhode Island employed fewer than 500 people and a majority of the private sector workforce was employed at those small businesses.
He said since the shutdown last March, small business revenues dropped 50 percent and the actual number of small businesses with sales declined by 40 percent.
“So more than four out of 10 small businesses in Rhode Island basically went out of operation during 2020. It's a staggering number.”
“Looking forward, the question is not whether or not there will be an economic recovery, there will be a recovery, it's already happening, people are already starting to go out more spend money more consumer spending has rebounded already to pre pandemic levels. The question is who is going to benefit from that recovery, because at the same time that small business revenue was down 50 percent last year, Amazon's revenue was up 38 percent… the question is who will benefit because of the only beneficiaries are the primary beneficiaries are the big chain stores and the big online retailers. And we don't rebuild a real small business ecosystem in Rhode Island, then we lose something we lose not only the jobs and the revenue, but we lose a part of our identity and part of our culture as Rhode Island.”
Magaziner said his office is looking to make it easier for existing small businesses to survive and for new ones to grow.
To do that Magaziner said the office has been moving millions of dollars of state money to local banks and credit unions.
“Because those local institutions know their communities, they can be more nimble in working with smaller businesses and more flexible in taking a risk on somebody who's starting a business for the first time.”
To illustrate, Magaziner said if a local community bank or credit union makes a loan, say $100,000, to someone starting a small business the Treasurer’s office will move $100,000 in state money to the financial institution.
“If it is a loan to a first time entrepreneur, a veteran owned business or a woman or minority owned business, we'll do a two to one match,” he said
Since the beginning of the program Magaziner said the state has moved more than $40 million to support more than 350 small business loans.
Magaziner said his office has introduced a whole series of bills to help existing small businesses and make it easier for people to start businesses.
He singled out legislation to exempt federal Payroll Protection Program loans that are exempt from federal taxation exempt from state taxation.
Here Magazine differs with Gov. Dan McKee who is looking to tax loans of more than $150,000. McKee argues not only does the state need the tax revenues to balance the budget, but also that companies with greater than $150,000 loans are likely to be larger and profitable companies.
Magaziner said, “At that level ($150,000), it still includes a lot of small businesses, restaurants, donut shops, small retailers, coffee shops, and so we're trying to get those taxes waived because we believe that Rhode Islanders deserve the same treatment that small businesses and 40 other states are getting.”
Another bill, he said, would make it easier for people to start new small businesses in Rhode Island or reopen closed businesses.
“So for example,” he said, “we have one bill and that says if you were a small business owner and you had to shut down and you're on unemployment, we will let you keep your unemployment benefits for a couple months while you reopen. So instead of those benefits shutting off on day one, you'll have a runway of a couple of months as you're ramping up to make it easier to go back.”
Among other programs of the Treasurer’s office, Magaziner touched on the crime victims’ compensation fund that help victims from a violent crime cover up to $25,000 in expenses incurred in connection with the crime. He funds can be used to cover lost wages, transportation, medical expenses, counseling and relocation among other things.
He said the fund had special relevance to Warwick in that it was available to the 60 people who were forced from their Les Chateaux apartments by arson.
Not all the meeting was devoted to economic recovery. Politics and Mazaziner’s plans, as he is term limited came up. He was asked if he would run for governor in 2022.
He talked about his love for Rhode Island and how he wants to continue working on programs to help the state.
And where does that leave it?
“The short answer is I haven’t decided yet,” he said.
Club President Dan Scanlon thanked Magaziner for finding the club’s unclaimed money, adding that during the meeting he went on the site, making application for personal unclaimed property he discovered.