Peter Marino likes challenges, and he has a big one on his plate after Gov. Lincoln Chafee tapped the public finance veteran to be the first director of Rhode Island's new Office of Management and Budget.

Chafee considers the office a crucial piece of the puzzle as Rhode Island tackles a variety of daunting obstacles at the state and local levels.

"Challenges need to be tackled. The governor has put OMB in charge of getting together a strategic plan. It's exciting stuff, even though it's on the wonky side," Marino, a former state Senate fiscal advisor, said Friday in a phone interview from state capital Providence.

"You can always do something better," he added.

Chafee, who called for such an office in his fiscal 2013 budget proposal early in the year, said the office would be proactive and grasp problems "before they become crises."

The new office will include the current budget office within the existing Department of Administration. It will also assume responsibilities from the Governor's Office of Economic Reinvestment and Recovery for the oversight of remaining federal stimulus funds. The state is phasing out the office in 2013.

Although Chafee did not mention the 38 Studios controversy in his announcement, fallout from the demise of the video-game company owned by former Boston Red Sox pitcher Curt Schilling has hovered over Rhode Island.

Last month the company filed for Chapter 7 liquidation in U.S. Bankruptcy Court for the District of Delaware in Wilmington.

Rhode Island taxpayers could be on the hook for $75 million, due to a loan guarantee provided by the Rhode Island Economic Development Corp. in 2010 to lure Schilling to move his company from Maynard, Mass.

Anthony Sabino, a Mineola, N.Y., attorney and law professor at St. John's University, said a department such as OMB can help prevent such fiascos in the future and help clear the shadow that the controversy has cast over the state.

"While 38 Studios is an isolated incident, it's still a black eye for Rhode Island. But the nice thing about black eyes is that they go away. And you can learn to duck the next time," Sabino said.

He sees the creation of OMB, which will include the current budget office within the current Department of Administration, as a plus.

"This is a source of comfort for the people who buy bonds in Rhode Island," Sabino said.

Moody's Investors Service rates Rhode Island's general obligation bonds Aa2, while Fitch Ratings and Standard & Poor's assign equivalent AA ratings.

"The creation of this office is a natural outgrowth of 38 Studios," Sabino said. "Part of Mr. Marino's function will be to stand up to a celebrity - Curt Schilling, Kim Kardashian, anyone - and if they say 'I want a hundred million,' he could say 'uh-uh.' "

"In the future, I think you'll see these large amounts reduced and more due diligence on the smaller amounts," he added.

Culling together parts of previous departments helps give Marino a running start. "The elements are already there," he said.

Sabino agreed that not starting the OMB from scratch is a plus. "They're not out naked in the woods and if that were so, I'd worry this day and age," he added.

Marino, in his previous job, aided Senate leadership in negotiating and developing the state's operating and capital budget.

"He always ensured that members of the chamber had the information they needed to make informed decisions," said Senate President M. Teresa Paiva Weed, D-Newport.

In addition, he served as director of research and public affairs for RDW Group, a Providence communications and public relations firm, where he analyzed National Medicare Part D programs, national and regional residential housing trends and forecasts, credit union banking trends in New England, and regional employment growth patterns and forecasts.

From 1996 to 2006, Marino was director of policy and municipal affairs for the Rhode Island Public Expenditure Council, a business-backed think-tank.

Marino plans to study how similar OMBs operate in other states, and looks forward to working with Rhode Island's revenue director, Rosemary Booth Gallogly.

"I've known Rose for 20 years and she does a very good job over there," he said.

Sabino added: "In general, this new agency could dovetail nicely on the revenue director's position."

One of Marino's immediate priorities will be an in-depth study of the state's transportation system, which Chafee announced during an impromptu visit to the Rhode Island Public Transit Authority's board meeting last week.

Marino envisions an initial report on RIPTA by Nov. 1, but said the study will extend beyond the authority to all transportation components within the Ocean State.

RIPTA, a quasi-public agency founded in 1964, has a projected deficit of nearly $8 million for fiscal 2013. It provides transit service throughout mainland Rhode Island.

Chafee's father, the late Gov. John Chafee, helped found the authority. The younger Chafee is the former mayor of Warwick.

According to the governor, the OMB will gauge the impact of the recently enacted federal transportation reauthorization on funding streams for state transportation programs; review fare subsidy programs within the authority; review RIPTA's fare-subsidy programs, and analyze growth trends within RIPTA and the Rhode Island Department of Transportation.

Additionally, by statute, the study will review bridge, vehicle and winter maintenance efficiencies, examine how similar agencies in other states function, and explore the impact of federal and state mandates.

RIPTA itself is also undertaking a market analysis, due out early next year, which will include feedback from an advisory committee of regional stakeholders.

Warwick Mayor Scott Avedisian, RIPTA's board chairman since January, welcomed the study and promised to work with Chafee and Marino.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.