Tom Sgouros over at the RI Policy Reporter just posted a good explainer on why "general revenue sharing" is important — and the impact gutting this line item in the state budget will have for municipalities.

The income and sales taxes levied by the state are sensitive to the economy. When the economy is rising, people's incomes are rising, and the amount of stuff we buy is, too. Collections from taxes on those things rise, too. In fact, because of inflation, the sales tax collections can rise faster than the economy. On the other hand, when the economy tanks, as it has, revenue from the sales and income taxes can drop precipitously, which is what we've seen this year.

The cities and towns are in a completely different situation. The property tax depends on the amount of property in town. This only wiggles gently compared to the swings in state taxes, in good times and bad. (Revaluations don't affect the level of taxes, only who pays.)

The difference means that when the economy is growing, the state's revenue stream is growing very quickly, while municipal revenue only creeps along. But costs like utilities, wages, health care, pensions, gasoline and all the rest, grow at exactly the same rate for both. When times are good, the state does fine, and can even consider tax cuts, all the while making disparaging noises about irresponsible cities and towns. Meanwhile cities and towns suffer and have to hike their tax rates just to keep up. This is the problem that revenue sharing was meant to address, at least in part.
— via RI Policy Reporter

Except that with S3050, we can can't raise property taxes. Rock, meet hard place.

Worth popping over to RIPR to read the whole thing. (And while you're there, why not check out some back issues, and maybe subscribe. You don't see this kind of fiscal analysis in local media.)