By KATHERINE GREGG
Journal State House bureau

PROVIDENCE, R.I. - With his sales-tax proposal under attack by top lawmakers, Governor Chafee has gone into campaign mode to save other major pieces of his budget, including roughly $60 million in what he calls "investments in the future,'' and "investments in roads and bridges.''

He defends his spending initiatives in a three-minute and 51-second video attached to his new online newsletter known as NewsLINC.

In it, he talks with enthusiasm about his attempts to fund the state's new education aid-formula, give additional money to the state colleges and university, provide an additional $19.3 million in reward-money state aid to cities and towns that handle their pension commitments responsibility, and start putting money aside to pay for road repairs so the state does not have to pay $43 million in interest on borrowings.

"That's a forward-looking budget, and I want to be governor of a state in which we are making those wise investments,'' he says.

"These are tough times. We've made a great number of cuts across state government,'' he says, to the point where communities that relied on state aid are going broke, and Rhode Islanders "can't register a car or get a license at the DMV.''

Looking back over the last three years, he said the state has also cut $38 million out of the state college system. "That is not in our long term best interest so my budget reverses that trend....[puts] $10 million in with the goal of no tuition increase at CCRI. That's the first step,'' he said.

Chafee's $7.66 billion spending plan for the new state budget year that begins July 1 hinged, in part, on $164.9 million in new sales tax revenues.

He sought to drop the state's sales tax rate from 7 percent to 6 percent, while extending the tax to a long list of currently-exempt goods and services and imposing a new 1 percent tax on a smaller list of tax-free items, such as shoes, clothing, home heating oil and coffins. Find out more about his proposals here.

House and Senate leaders said the tax proposal would not pass, as proposed, after business owners targeted by Chafee's sales tax proposal showed up in force last week to protest it.

But they did not say how they intended to make up the $164.9 million in net new revenue, and did not say it was off the table entirely.

But the hunt for alternatives began almost immediately, with attention focusing first on how much the state might "save'' by keeping the sales tax rate at 7 percent ($117 million) and forgoing the first in a series of corporate income tax cuts proposed by Chafee ($14.6 million).

Their job was also made a bit easier by a report, by the administration, that revenue collections through March were running $49.5 million ahead of the expectations, last fall, of the state's official revenue-estimating committee.

But lawmakers have also begun talking about cutting Chafee's budget.

"This is a budget for the future in very, very difficult times,'' Chafee said.