AN ACT RELATING TO PUBLIC FINANCE -- STATE BUDGET--PROGRAM PERFORMANCE MEASUREMENT (Provides additional oversight and reporting measures related to audits and capital projects.)

H8146

2026 -- H 8146
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LC005730
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STATE OF RHODE ISLAND
IN GENERAL ASSEMBLY
JANUARY SESSION, A.D. 2026
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A N A C T
RELATING TO PUBLIC FINANCE -- STATE BUDGET--PROGRAM PERFORMANCE
MEASUREMENT

Introduced By:
Representatives Marszalkowski, and Slater

Date Introduced:
February 27, 2026

Referred To:
House Finance
It is enacted by the General Assembly as follows:
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SECTION 1. Sections 35-3-7.2, 35-3-17.1 and 35-3-24.1 of the General Laws in Chapter
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35-3 entitled "State Budget" are hereby amended to read as follows:
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35-3-7.2. Budget officer as capital development officer.
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The budget officer shall be a capital development program officer who shall be responsible
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for:
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(1) The review of all capital development requests submitted by the various state
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departments, as set forth in chapter 6 of title 42, which shall include all independent boards and
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commissions and the capital development plans of the Narragansett Bay Commission, Rhode Island
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infrastructure bank, the Lottery Commission, and all other public corporations, as defined in
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chapter 18 of this title which plans would be subject to the provisions of § 35-18-3; provided, that,
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except as provided for in this section, nothing in this section shall be construed to limit the powers
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of the council on postsecondary education as outlined in chapter 59 of title 16. Capital development
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requests and plans shall be submitted in such form, with such explanation, in such number of copies,
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and by such date as the budget officer may require. Copies shall also be provided directly to the
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house fiscal advisor and the senate fiscal advisor.
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(2) Preparation of a capital budget which shall specify which capital items are proposed for
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presentation to the electorate at the next general election.
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(3) The activities which will promote capital development planning and develop criteria

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which can be used to determine appropriate levels of bonded indebtedness.
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(4) Acting as chairperson of the capital development planning and oversight commission
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which is to be appointed by the governor
and shall meet no less than quarterly
. The commission,
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in addition to recommending to the governor the biennial capital budget, shall implement a long-
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range capital development planning process and shall be responsible for the development of an
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inventory of state assets to determine the need and prioritization of capital improvements.
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(5) Working with the council on postsecondary education in the development by the
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council of that portion of the council’s capital development program involving annual general
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revenues.
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35-3-17.1. Financial statements required from state departments, agencies, and
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instrumentalities.
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The several state departments, agencies, and public authorities and corporations shall
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submit to the fiscal advisors of the house and senate, statements of financial conditions and
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operations within thirty (30) days of the close of each of the first three (3) fiscal quarters of each
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year. The statements shall include, at a minimum:
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(1) Account numbers;
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(2) Allotments;
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(3) Expenditures to-date;
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(4) Estimated expenditures to complete the fiscal year;
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(5) Surplus or deficiency projections;
and
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(6) Progress on any corrective action plans per the most recent annual findings of the
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auditor general
.
, the party responsible to implement the corrective action plan, and, if applicable,
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the reasons for disagreement with any recommendation proposed by the auditor general; and
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(7) The status of capital projects for which any funding from general obligation bond
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proceeds, Rhode Island Capital Plan funds, or other pay-as-you-go sources has been approved for
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the current fiscal year.
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35-3-24.1. Program performance measurement.
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(a)
(1)
Beginning with the fiscal year ending June 30, 1997, the governor shall submit, as
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part of each budget submitted to the general assembly pursuant to § 35-3-7, performance objectives
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for each program in the budget for the ensuing fiscal year, estimated performance data for the fiscal
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year in which the budget is submitted, and actual performance data for the preceding two (2)
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completed fiscal years. Performance data shall include efforts at achieving equal opportunity hiring
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goals as defined in the department’s annual affirmative action plan. The governor shall, in addition,
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recommend appropriate standards against which to measure program performance. Performance in

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prior years may be used as a standard where appropriate. These performance standards shall be
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stated in terms of results obtained.
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(2) Beginning with the fiscal year 2028 budget submission, the capital budget shall identify
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to the extent possible the source of the cost estimate upon which the recommendation is based and
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which capital projects have had material changes to the scope of work or cost changes of more than
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five percent (5%) from approved amounts.
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(b) The governor may submit, in lieu of any part of the information required to be submitted
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pursuant to subsection (a), an explanation of why the information cannot as a practical matter be
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submitted.
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(c)(1) The office of management and budget shall be responsible for managing and
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collecting program performance measures on behalf of the governor. The office is authorized to
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conduct performance reviews and audits of agencies to determine the manner and extent to which
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executive branch agencies achieve intended objectives and outcomes.
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(2) In order to collect performance measures from agencies, review performance, and
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provide recommendations, the office of budget and management is authorized to coordinate with
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the office of internal audit and program integrity regarding the findings and recommendations that
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result from audits conducted by the office.
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(3) In order to facilitate the office of management and budget’s performance reviews,
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agencies must generate and provide timely access to records, reports, analyses, audits, reviews,
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documents, papers, recommendations, contractual deliverables, or other materials available relating
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to agency programs and operations.
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(4) In order to ensure alignment of executive branch agency operations with the state’s
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priorities, the office of management and budget may produce, with all necessary cooperation from
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executive branch agencies, analyses and recommendations to improve program performance,
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conduct evidence-based budgeting, and respond to sudden shifts in policy environments.
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(5) In order to gain insight into performance or outcomes and inform policymaking and
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program evaluation, the office of management and budget may lead, manage, and/or coordinate
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interagency and cross-system collaboration or integration initiatives.
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SECTION 2. Section 42-11-2.5 of the General Laws in Chapter 42-11 entitled "Department
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of Administration" is hereby amended to read as follows:
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42-11-2.5. Information technology restricted receipt account and large systems
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initiatives fund.
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(a) All sums from the sale of any land and the buildings and improvements thereon, and
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other real property, title to which is vested in the state, except as provided in § 37-7-15(b) through

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(d), shall be transferred to an information technology restricted receipt account (ITRR account) that
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is hereby established. This ITRR account shall consist of such sums from the sale of any land and
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the buildings and improvements thereon, and other real property, title to which is vested in the state,
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except as provided in § 37-7-15(b) through (d), as well as a share of first response surcharge
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revenues collected under the provisions of § 39-21.1-14. This ITRR account may also consist of
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such sums as the state may from time to time appropriate; as well as money received from the
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disposal of information technology hardware, loan, interest, and service charge payments from
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benefiting state agencies; as well as interest earnings, money received from the federal government,
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gifts, bequests, donations, or otherwise from any public or private source. Any such funds shall be
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exempt from the indirect cost recovery provisions of § 35-4-27.
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(1) This ITRR account shall be used for the purpose of acquiring information technology
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improvements, including, but not limited to: hardware, software, consulting services, and ongoing
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maintenance and upgrade contracts for state departments and agencies.
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(2) The division of enterprise technology strategy and services of the Rhode Island
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department of administration shall adopt rules and regulations consistent with the purposes of this
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chapter and chapter 35 of this title, in order to provide
recommendations
for the orderly and
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equitable disbursement of funds from this ITRR account
; provided, however, disbursements from
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the ITRR account shall be subject to project-specific appropriations and separately listed in the
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capital budget submission
.
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(3) For all requests for proposals that are issued for information technology projects, a
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corresponding information technology project manager shall be assigned.
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(b) There is also hereby established a special fund to be known as the large systems
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initiatives fund (LSI fund), separate and apart from the general fund of the state, to be administered
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by the chief information officer within the department of administration for the purpose of
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implementing and maintaining enterprise-wide software projects for executive branch departments.
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The LSI fund shall consist of such sums as the state may from time to time directly appropriate to
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the LSI fund, any accrued interest, and any funds collected pursuant to subsection (b)(1) of this
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section. After the completion of any project, the chief digital officer shall inform the state controller
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of unexpended sums previously transferred to the LSI Fund for that project and the state controller
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shall subsequently transfer any such unexpended funds to the information technology restricted
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receipt account
; provided, further, the unexpended sums from a completed project and the
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subsequent transfer to the ITRR account shall be reported by the state controller to the chairpersons
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of the house finance committee and the senate finance committee
. The state controller shall transfer
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any excess interest accrued in the LSI fund and any funds collected pursuant to subsection (b)(1)

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of this section to the ITRR account.
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(1) The director of the department of administration may allocate and charge capitalized
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costs, in accordance with the statewide cost allocation plan, to agencies that benefit from initiatives
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funded through the LSI Fund. The department of administration shall include as part of its budget
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submission pursuant to § 35-3-4 an expected billing schedule for any capitalized costs that the
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department intends to charge to agencies for the next ensuing fiscal year.
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(c) For any new project initiated using sums expended from the LSI Fund, as part of its
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budget submission pursuant to § 35-3-4 relative to state fiscal year 2025 and thereafter, the
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department of administration shall include a statement of project purpose and the estimated project
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cost.
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SECTION 3. This act shall take effect upon passage.
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EXPLANATION
BY THE LEGISLATIVE COUNCIL
OF
A N A C T
RELATING TO PUBLIC FINANCE -- STATE BUDGET--PROGRAM PERFORMANCE
MEASUREMENT
***
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This act would provide additional oversight and reporting measures related to audits and
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capital projects.
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This act would take effect upon passage.
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LC005730
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