Rhode Island’s billionaire isn’t quite as wealthy today as he was last fall.

Financier Jonathan Nelson is once again the only Rhode Islander on Forbes’ list of the world’s 1,426 billionaires. His net worth of $1.5 billion puts him at #974, placing him among the poorest third of people with 10-figure fortunes. A year ago he was #854.

Nelson, founder and CEO of the powerhouse private-equity firm Providence Equity Partners, had seen his fortune inch up to $1.7 billion as of September but it’s now back to $1.5 billion, according to Forbes. It peaked at $2 billion before the market crash of 2008, then dipped to a low of $1.35 billion in September 2010.

Nelson, 56, was raised in Providence by an orthodontist, graduated from Brown in 1977 and founded ProvEq in 1989. He and his wife own a $1.5 million home on Providence’s East Side but mostly stay out of the local limelight, though they’ve been generous to Brown and he sits on the board for Newport’s jazz and folk festivals.

Another Rhode Islander who used to be among Forbes’ billionaires – Hope Hill “Happy” van Beuren, the Campbell’s Soup heiress who lives in Middletown – hasn’t appeared on any of its wealth rankings since March 2011 because her fortune is shared by her family. She chairs the van Beuren Charitable Foundation.

A part-time Rhode Islander on the list is Oracle CEO Larry Ellison, who owns Beechwood Mansion in Newport. Ellison’s net worth of $43 billion makes him the fifth-richest man in the world, behind only Mexico’s Carlos Slim, Bill Gates, Spain’s Amancio Ortego and Warren Buffett.

• Related: Romney’s wealth dwarfed by RI billionaire Jonathan Nelson’s (Nov. 16)

Rhode Islanders pay the 13th-highest state and local taxes in the country compared with their incomes, according to the latest analysis of Census data by the Massachusetts Budget and Policy Center.

The $6.9 billion in state and local taxes paid by Rhode Islanders in 2009-10 totaled 11.1% of their personal income, up slightly from 11.0% the prior year, the analysis shows. Just 12 other states took more of their residents’ income in state and local taxes, according to the group.

The national average was 10.6% of income, and Massachusetts ranked 25th at 10.2% of income, the analysis shows. Three other New England states – Maine, Vermont and Connecticut – took more of their residents’ incomes in taxes than Rhode Island did, while New Hampshire took the least.

The left-leaning Massachusetts think tank said it looks at taxes as a share of personal income rather than per capita because it “allows for a meaningful comparison among states.” Another group, the right-leaning Tax Foundation, ranks Rhode Island’s tax burden higher after making adjustments to the data.

• Related: Charts: Regressive RI taxes getting (slightly) more progressive (Jan. 30)

(chart: Massachusetts Budget and Policy Center modified by WPRI.com)

The Bureau of Economic Analysis is out today with its latest report on personal income in local areas, and the findings for the Providence-New Bedford-Fall River metropolitan area aren’t too bad.

Personal income in the Providence area rose to $43,192 in 2011, up from $41,343 per capita in 2010, and the annual growth rate quickened from 3.2% to 4.5%. At $43,192 per person, Providence-area personal income ranked 58th among the 366 U.S. metro areas and was slightly above the $41,560 national average. However, incomes grew more slowly last year in the Providence area (4.5%) than they did nationwide (5.2%).

For comparison’s sake, the highest per-capita personal income in the country last year was $78,504 in the area around Bridgeport, Conn. and the lowest was $21,620 around McAllen, Texas. The Boston area’s per-capita income was 7th-highest at $57,893, or $14,701 more than the Providence area’s.

Where did area residents earn their $43,192 each? Here’s total 2011 personal income paid by top industries:

1. Health care and social assistance: $6.7 billion
2. Manufacturing: $4.9 billion
3. Local government: $3.8 billion
4. Finance and insurance: $3.1 billion
5. Professional, scientific and technical services: $2.9 billion
6. Retail trade: $2.9 billion
7. Construction: $2.3 billion
8. State government: $1.8 billion

Over the weekend, Rhode Island’s Future contributor Oswald Krell used Corporation for Enterprise Development data to argue the richest Rhode Islanders are getting a better deal tax-wise than their wealthy peers in neighboring states:

In other words, the bottom 20% [in Rhode Island] pays a rate that is more than twice the rate paid by the top 1%.

And Mass is two spots worse, CT is one spot better, so spare me the “Oh, I could just move to Mass and save all this money” lie. And founder of a certain ‘alternative’ party, I’m looking at you.

What does this mean? The top end earners are not overtaxed. They have a great gig going.

It’s true that Rhode Island has a larger gap between the share of income paid in state taxes at the top and bottom than the median state, Mississippi. But there’s another way to read the CFED data – that Rhode Island taxes everybody more than most other states.

(more…)

Rhode Islanders pay the 12th-highest state and local taxes in the country by one measure, according to new U.S. Census Bureau data released this week.

The $7.5 billion in state and local taxes paid by Rhode Islanders in 2008-09 totaled 11% of their personal income, according to an analysis of Census data by the Massachusetts Budget and Policy Center.

The tax level was higher than in 38 of the 50 states, and topped the national average of 10.4%. Massachusetts ranked 33rd with a tax-to-income rate of 9.8%. Alaska ranked first and South Dakota ranked last.

“Measuring taxes as a share of total personal income allows for a meaningful comparison among states,” the center said in a report, contrasting it with the methodology used by The Tax Foundation in Washington.

(chart: Massachusetts Budget and Policy Center, modified by WPRI.com)

In their report last week downgrading Rhode Island’s credit outlook, analysts at Moody’s cited “an economy that has long lagged the nation’s” as one of their reasons for doing so.

A similar thought came to my mind last week as I (finally) read a study published earlier this year by the Massachusetts Budget and Policy Center, a liberal think tank in Boston. It’s called “The State of Working Massachusetts 2010,” and it focuses on how the Bay State has had an easier time weathering the Great Recession than other states or the nation as a whole.

The study is filled with charts – 27 in all – and the key takeaway is that Massachusetts’ work force has gotten more educated and better paid over the past 30 years. For a Rhode Islander, though, it’s also a reminder of the state’s failure to keep up with its two neighbors.

Now, it’s not all bad news. Rhode Island does better than the national average on many measures. Regionally, though, we’re a laggard.

I don’t have a lot of analysis to add, but I thought I’d post a couple of the charts. Here are two on how much money people make – I added arrows pointing to Rhode Island and Connecticut:

There are two other charts after that which show growth in Rhode Island’s median household income trailed the country’s from 1979 to 2009, but that growth in the state’s median hourly wage was 10th-highest.

Then we come to the education section. This chart, for instance, shows the “strong correlation” between median hourly wages and the percentage of a state’s work force with a bachelor’s degree:

And here’s how much of the work force has a bachelor’s degree in the various states (same information as the bottom part of the last chart):

Just some interesting facts to keep in mind as Rhode Island struggles to recover from the recession and build a more prosperous economy, as the politicians always say.

It’s not looking great for the Bruins as they get set for Game 3 of the Stanley Cup Finals in Boston tonight, but we’re keeping the faith here at Nesi’s Notes. The Globe’s Kevin Paul Dupont caught my eye with these chart-ready stats about the NHL in his column on Sunday:

According to league data, the average household income (HHI) for NHL fans is $104,000, highest of the four major sports with Major League Baseball ($96,200), the NBA ($96,000), and the NFL ($94,500). Sixty-eight percent of NHL fans have attended college, more than the other three sports (ranging 60.4 percent to 63.6 percent). And 64 percent of NHL fans hold full-time jobs, also more than the others (57-58.1 percent).

All in all, hockey fans are a well-educated, well-heeled, Internet-savvy bunch, no matter what the perception. Not surprisingly, they also like their beer. According to Latimer, Bruins fans buy upward of 30 percent more brew at the Garden than Celtics fans.

I find that interesting and, as Dupont notes, somewhat counterintuitive. What do you think explains it?

Is Brown University living up to its stated commitment to socioeconomic diversity? Not according to one new study. [Though it's making strides; see this follow-up.]

Only 10.9% of Brown students – 719 in an undergraduate student body of roughly 6,000 - received federal Pell grants during the 2008-09 school year, according to a Chronicle of Higher Education study. Among elite colleges, that was more than Harvard’s 6.5% but lower than Stanford’s 12%.

The New York Times’ David Leonhardt explains the significance:

Pell Grants are easily the country’s largest financial-aid program and, as a rule of thumb, they tend to go to students who come from the bottom half of nation’s income distribution. …

I wouldn’t expect 50 percent of Harvard students — or even, say, 40 percent of Harvard students — to come from the bottom 50 percent of the income distribution. But 6.5 percent? To put it another way, do you believe that more than 93 percent of the students who are most deserving of attending the nation’s most prestigious, best financed college come from the top half of the income distribution?

In Brown’s case, its enrollment implies that 89% of the best students in the country come from upper-income families. This is at a school with a need-blind admission policy - meaning, as the university’s website says, “a candidate’s financial need will not be taken into consideration when deciding to admit, wait list, or deny an applicant.”

More power to the 11% of lower-income students who squeaked into Brown, but do administrators there really think this situation reflects reality? Leonhardt doesn’t, and he cites a Princeton study which “found that elite colleges gave zero credit in the applications process to students from low-income families.”

The late Claiborne Pell, a Rhode Islander himself, would likely urge Brown to make better use of his eponymous grants. The university’s low Pell rate doesn’t appear to fit with the philosophy espoused by its eight-year-old Office of Institutional Diversity, either (emphasis mine):

Diversity is the foundation of the academic enterprise. Exposure to a broad range of perspectives, views and outlooks is key to fostering both breadth and depth in intellectual knowledge.

Diversity policies and programs at Brown are designed to: (1) redress historical patterns of exclusion and (2) foster opportunities to embrace the greatest mix of ideas, opinions, and beliefs so important to the achievement of academic excellence. Accordingly, the term diversity is used at Brown in the broadest sense to encompass many things such as race, color, religion, age, national and ethnicity origin, disability, status as a veteran, language, socio-economic background, sex, sexual orientation, gender identity, gender expression, political ideology, theoretical approach and the list can go on. It is through the interaction among individuals from a diverse set of experiences, histories and backgrounds that true intellectual diversity is achieved.

At Brown, we seek to achieve diversity in our living, learning and working environments by placing emphasis on the recruitment and retention of students, faculty and staff from a wide range of backgrounds and experiences. We also work to ensure diversity in our curricular and co-curricular offerings, and we invest in the structural supports needed to manage our lively, provocative, and stimulating community.

Update: Coincidentally, Brown is sending its acceptance notices tonight to 2,692 students – just 8.7% of the 30,948 who applied to join the Class of 2015. That was the largest number of applicants in Brown history.

The university says it admitted 74 of the 394 Rhode Islanders who applied – an 18.8% admit rate, more than double the Brown-wide one. Congratulations to the lucky 74.

Perhaps the Class of ’15 will be more economically diverse, too – Brown says nearly 67% of them applied for financial aid.

Update #2: Brown responds – Pell Grants are up 37% since the Chronicle study, and the share of students with loan-free aid packages has jumped from 6% to 61%, a university spokeswoman tells me.

(photo: Brown University)

Projo columnist Ed Achorn says wealthy Rhode Islanders are leaving the state in significant numbers because of high taxes. NEARI official and Rhode Island’s Future contributor Pat Crowley says that’s dead wrong.

This debate has been going on for ages, and I for one would like to know who’s right – or, if both men have some of the facts on their side, what those facts tell us about economic migration. But I’m afraid I don’t have the time to really examine their claims as closely as I would like.

This, then, would seem like a perfect job for PolitiFact Rhode Island, The Journal’s new fact-checking site. I realize it might be a little awkward for Tim Murphy and his team, since Achorn is their colleague – but hey, all the more reason to show that PolitiFact weighs claims and issues judgments without fear or favor.

So how ’bout it, PolitiFact? Rhode Island turns its bleary eyes to you.

Update: Justin Katz says I mischaracterized Achorn’s (and his) concerns.

Apropos the chart I put up earlier showing Rhode Island household income, NEARI‘s Pat Crowley pointed out that a more accurate way to look at state residents’ earnings in the context of the Bush tax cuts would be to show the breakdown for Rhode Islanders’ adjusted gross income, or AGI. That represents your income after deductions and is used to calculate your tax bill.

When reporters say Republicans want to extend the Bush tax cuts “for households earning $250,000 or more,” we really mean “for households with adjusted gross income of $250,000 or more.” But that would clog up our stories, so most people go with the shorthand. Thus, a household with total income of, say, $300,000 but AGI of $240,000 would be eligible for the Bush tax cut rate under either plan.

Crowley’s comment gives me an excuse to put up yet another chart. Here’s one breaking down Rhode Island taxpayers’ AGI on their 2008 tax returns, according to the Division of Taxation. It’s quite a different picture:

Like a singer at a sleazy bar, I take requests. Do you have a question you’d like to see answered in a chart? Let me know and I’ll try to find the figures and whip one up. (My old math teachers would be so proud. Not to mention incredulous.)

Update: The Obama-GOP deal would also reportedly cut the payroll tax (the one that pays for Social Security and Medicare) from 6.2% to 4.2% next year, presumably in an effort to stimulate consumer spending.

Under that proposal, a worker who makes $40,000 a year and gets paid biweekly would receive an extra $33 per paycheck, or $800 over the course of the year, according to The Tax Foundation.

Update #2: Haven’t heard from Reed or Whitehouse yet – there’s an impeachment trial going on in the Senate today, so they’ve been tied up with that. Kennedy’s spokesman never responded. Langevin’s office issued this statement, which leaves the door open to supporting Obama’s proposed deal:

In the coming days I will be studying the proposed tax deal, meeting with colleagues and listening to constituents. Preserving middle-class tax cuts remains one of my top priorities. However, at a time when we are asking unemployed families and low-income seniors to share in the sacrifice necessary to balance our budget, I have said many times that it is not unreasonable to ask the richest two percent to do the same.

Update #3: I asked Tax Foundation economist Mark Robyn whether AGI was the appropriate measure to use. He said Congress’ Joint Committee on Taxation and organizations like his do use AGI for these calculations.

“What that actually means for where income tax increases began to take effect (via higher rates, or more aggressive phase-out of provisions like itemized deductions) is another question,” Robyn said. The committee has taken Obama’s promise to mean income minus the standard deduction and either one or two (for a married couple) personal exemptions.

If you adjust for inflation, that would be $235,150 for a couple filing jointly and $193,800 for a single taxpayer, Robyn said. Whew.

The big political news today is President Obama’s deal with Congressional Republicans to extend all of the Bush tax cuts for another two years and reduce the estate tax in exchange for extended unemployment benefits, a payroll tax cut and other policies.

I’ve reached out to Rhode Island’s Congressional delegation to get their reactions to the deal, which met with a tepid response from Senate Majority Leader Harry Reid when it was announced last night. Spokesmen for U.S. Sens. Jack Reed and Sheldon Whitehouse said they won’t be commenting prior to a lunchtime meeting of all Democratic senators. I left messages with U.S. Reps. Patrick Kennedy and Jim Langevin.

Obama and the Republicans always agreed that the tax cuts for families making less than $250,000 should be extended. That accounts for roughly 80% of the extension’s 10-year, $3.7 trillion cost. The debate was over whether the cuts for families making more than $250,000 should continue. For context, here’s a look at what percentage of Rhode Island households earned different amounts of money in 2008, via the U.S. Census Bureau:

The U.S. Census Bureau released state-level data today on poverty, health insurance, income and other household characteristics in 2009. It’s a fascinating snapshot of how the Great Recession and its aftermath are affecting local families. Here are a few quick hits.

(Caution: Rhode Island is small, which makes it hard to sample, and these numbers are all estimates. Also, this is data from an annual survey, not the formal 10-year Census count that was done during the spring; that information won’t be released until December.)

Households: There were 406,000 households in Rhode Island in 2009, with an average of 2.5 people each. Families made up 63% of households.

Gender and race: Rhode Island’s population of 1.1 million was slightly more female than male, with 542,000 women and 511,000 men. The median Rhode Islander was 39.4 years old in 2009, and 83% of the state’s residents were white.

Poverty: The estimated number of Rhode Islanders living below the poverty line fell slightly, from 12% in 2008 to 11.5% in 2009. The national average was 14.3%. A total of 116,378 Rhode Islanders lived in poverty last year.

Income: The median household income in Rhode Island was $54,039 in 2009, down 1.4% from the year before. Rhode Island was less unequal than the national as a whole, with a Gini coefficient of 0.457, compared with 0.469 for the U.S. (A 0 is perfect equality, while a 1 is perfect inequality.) Social Security benefits worth an average of $14,968 flowed to 29% of Rhode Island households.

Insurance: In Rhode Island, 11.3% of residents were uninsured last year. Of those who did have health insurance, 72.2% had private health insurance and 28.9% had government health insurance, such as Medicare and Medicaid.

Transportation: While 3.2% of Rhode Islanders walked to their jobs last year, the vast majority of us – 80% – drove alone to work.

Immigration: As of 2009, 13% of Rhode Islanders were born outside the U.S., and 21% of people ages 5 and up spoke a language other than English at home.

Education: In 2009, 85% of Rhode Islanders ages 25 and up had a high school diploma, with 31% having a bachelor’s degree or higher. A total of 90,000 people were enrolled in college or grad school.

Housing: The state had 542,000 housing units in 2009, though 10% of them were empty. The median cost of housing was $1,879 for homeowners with a mortgage; $890 for renters; and $637 for homeowners with no mortgage. Half of renters spent at least 30% of their incomes on housing.

(image credit: U.S. Census Bureau)

So reports Time magazine:

People say money doesn’t buy happiness. Except, according to a new study from Princeton University’s Woodrow Wilson School, it sort of does – up to about $75,000 a year. The lower a person’s annual income falls below that benchmark, the unhappier he or she feels. But no matter how much more than $75,000 people make, they don’t report any greater degree of happiness.

Before employers rush to hold – or raise – everyone’s salary to $75,000, the study points out that there are actually two types of happiness. There’s your changeable, day-to-day mood: whether you’re stressed or blue or feeling emotionally sound. Then there’s the deeper satisfaction you feel about the way your life is going – the kind of thing Tony Robbins tries to teach you. While having an income above the magic $75,000 cutoff doesn’t seem to have an impact on the former (emotional well-being), it definitely improves people’s Robbins-like life satisfaction. In other words, the more people make above $75,000, the more they feel their life is working out on the whole. But it doesn’t make them any more jovial in the mornings.

Update: To put this in context, one of my producers points out that the median household income in Rhode Island was $55,701 in 2008 (the most recent year for which figures are available), according to the U.S. Census Bureau. No state had median income of $75,000 or more, although Maryland and New Jersey came closest, each at just above $70,000.

(image credit: Hasbro)