Rhode Island Gov. Lincoln Chafee's $8.2 billion budget for fiscal 2014 would cut the corporate tax rate to 7% from 9% over three years and add $20 million to cities and towns, with an emphasis on distressed communities and improving local pension plans.

Chafee, addressing the General Assembly in Providence in a combined budget and state of the state speech on Wednesday night, proposed an additional $20 million next year in local aid, with $10 million for distressed communities and a further $10 million, distributed based on population, to encourage municipalities to improve their pension plans.

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