Governor signs FY17 state budget after vetoes

Gov. Charlie Baker signed the fiscal 2017 state budget bill last Friday after vetoing $256 million in spending.
 
The $38.9 billion post-veto spending plan reflects the slack in state tax collections over the last half of fiscal 2016, a situation that is forecast to carry over into this year. Projected spending for fiscal 2017 increases by just 1.3 percent in the governor’s plan.
 
In his letter to the Legislature upon signing the budget, the governor wrote that preliminary estimates for tax collections in fiscal 2016 fell between $425 million and $475 million below projections, and that the forecast for the year that just began has been scaled back by $650 million to $950 million. While a part of the shortfall was accounted for in the Legislature’s budget bill, approved on June 30, the governor went further in cutting spending across the budget, including nearly 500 earmarked spending accounts.
 
The governor vetoed almost one-third of the law changes proposed in the budget bill.
 
In an important win for cities and towns, the vetoes included Section 45, which would have extended for an additional two years the freeze on contributions toward the cost of health insurance for retired local government employees. This rule would have applied to those cities and towns that used the provisions of the 2011 municipal health insurance reform law to reduce costs. The MMA will be asking the House and Senate to sustain the governor’s veto.
 
The governor approved funding for the main municipal and school aid accounts as appropriated by the Legislature. Unrestricted General Government Aid is funded at $1.02 billion, an increase of $42 million, the same amount recommended by the governor in January and approved by the House and Senate. Chapter 70 education aid is funded at $4.6 billion, an increase of $116 million.
 
The governor did veto $3.7 million in funding for special education “circuit breaker” reimbursements. The post-veto amount of $274 million falls short of the full funding amount calculated earlier in the year by as much as $10 million.
 
The governor also vetoed $216,000 in library aid, $8 million from the municipal regionalization grant program, $6.3 million from the state revolving fund contract assistance account, and a variety of smaller municipal and school accounts. The MMA is reviewing the impact on cities and towns.
 
The Legislature is expected to consider overrides of some vetoes this week.