Gov. imposes $40M in mid-year cuts to local funding

Gov. Deval Patrick today unveiled a plan to impose immediate mid-year cuts to close a $329 million state budget deficit that he disclosed two weeks ago.

The governor’s budget cuts would hit every city, town and local school district with an unexpected loss of $40.3 million in promised funding that is used to deliver municipal and school programs.

The governor has also filed legislation asking the Legislature to cut $25.5 million from Unrestricted General Government Aid and to impose other cuts across state government.

In all, the governor’s plan would impose more than $65 million in mid-year cuts to cities and towns.

“These cuts are bad news for cities and towns in every corner of the state, and will shift the state’s fiscal problems onto communities in the middle of the fiscal year,” said MMA Executive Director Geoff Beckwith. “By slashing education funds that have been promised to reimburse communities for the cost of special education programs, charter schools and the transportation of students, these budget cuts will be harmful to schools, and the governor’s proposal to cut unrestricted municipal aid would further hit municipal services and local schools, because cities and towns use their local aid to fund local education budgets.”

The state is facing a deficit that is mostly the result of administrative and budget management issues at the state level. Beckwith pointed out that the administration’s plan would solve the state’s problem by shifting much of the burden onto communities.

Using his statutory authority to reduce executive branch spending, Gov. Patrick has unilaterally cut approximately $200 million from the state budget, including $40.3 million in direct funding to cities, towns and school districts from the following accounts:

• $18.7 million from Regional School Transportation (a 27% cut)
• $7.1 million from the Regionalization and Efficiencies Reserve (a 49% cut)
• $3.86 million from Special Education Reimbursements (a 1.5% cut)
• $2.88 million from the Chapter 70 “pothole” account (an 85% cut)
• $2.24 million from Vocational School Transportation (a 100% cut)
• $1.3 million from Public School Military Mitigation Grants (a 100% cut)
• $1.2 million from Charter School Reimbursements (a 1.5% cut)
• $1.1 million from Sewer Rate Relief (a 100% cut)
• $1 million from Extended Learning Time Grants (a 6.8% cut)
• $359,000 from Kindergarten Expansion Grants (a 1.5% cut)
• $287,000 from METCO (a 1.5% cut)
• $283,000 from Library Aid (a 1.5% cut)

According to an analysis by the MMA, every city, town and school district will be hit with one or more of the governor’s immediate budget cuts. In most cases, the cuts will feel much deeper because the reductions are being implemented five months into the fiscal year. For example, a 10 percent cut in an account will translate into a 17 percent cut from now to the end of the year, and a 50 percent cut in a program will translate into an 85 percent reduction in remaining reimbursements due to cities and towns.

The $40.3 million in mid-year cuts to specific municipal and school accounts in the state budget will go into effect immediately, because state law gives the governor the unilateral power to take this action. But the MMA is mobilizing against the governor’s legislation to implement a $25.5 million cut in Unrestricted General Government Aid, the main municipal aid account that goes to every city and town. (State law does not give the governor the power to cut UGGA without the Legislature’s approval.)

“We strongly oppose this proposed local aid cut because it would destabilize municipal and school budgets in the middle of the fiscal year and force reductions in community services,” Beckwith said. “Unrestricted municipal aid is already $400 million below original fiscal 2009 levels, and any additional cuts will be painful for cities and towns across the state. On behalf of cities and towns across the Commonwealth, we respectfully ask the Legislature to reject the governor’s proposed municipal aid cut.”

• MMA statement on governor’s mid-year budget-cutting plan

• MMA’s letter to the Legislature urging them to reject proposed cut to UGGA

• Link to the A&F website for the governor’s budget-cutting announcement