Gov. Deval Patrick yesterday signed a $32.5 billion state budget for fiscal 2013 that increases funding for a variety of important municipal and education aid accounts and begins a recovery from the deep cuts that go back to fiscal 2009, when the last recession hit Massachusetts.

In signing the spending plan for the new fiscal year – and issuing only a handful of vetoes totaling $32 million – the governor said that the budget makes “record investments in K-12 education.”

The final budget bill increases local aid by almost $300 million over the fiscal 2012 level and roughly $140 million above the amount originally recommended by the governor in January.

The Legislature increased funding for the Cherry Sheet Unrestricted General Government Aid account by $65 million, from $834 million to $899 million, consistent with the growth in Lottery profits that are expected to set a record when the final numbers for fiscal 2012 are reported later this year. The MMA strongly supported the Legislature’s municipal aid appropriation, which was a top state budget priority for cities and towns this year, to help pay for municipal services and avoid over-reliance on the property tax.

Chapter 70 education aid was boosted from $3.99 billion to $4.17 billion, an increase of $180 million. The appropriation ensures that every school district is able to at least reach the “foundation” level of school spending that forms the basis of the state’s landmark education finance reform law. The budget also restarts equity provisions that had been put on hold and ensures that all districts receive an increase this year of at least $40 per student.

In addition to the main local aid programs, several other important municipal aid and public safety grant programs were funded in the budget signed by the governor.

The Cherry Sheet Payment-in-Lieu-of-Taxes (PILOT) account for state-owned land was level-funded at $26.3 million. This is an important account for cities and towns that host state facilities that require local government services, particularly public safety services.

The Gang Violence Prevention (Shannon) grant program was funded at $6.25 million. In a supplemental budget bill filed with the fiscal 2013 general appropriation bill, the Governor recommended that funding be increased by an additional $1.5 million.

The fiscal 2013 state budget also includes a $500,000 appropriation for smart growth school cost reimbursements due to be paid under Chapter 40S to cities and towns that have adopted smart growth zoning districts under Chapter 40R.

The governor also signed two important funding commitments initiated by the Legislature.

The special education “circuit breaker” account is funded at $242 million this year to fully fund the state’s statutory 75 percent share of certain special education costs over four times the state average foundation budget per student level. This is an important program that helps all school districts with the increasingly burdensome cost of complex and expensive special education services.

In addition, the governor approved $11.3 million to reimburse cities and towns for the cost of a mandate to transport certain students living in temporary housing. Earlier this year, State Auditor Suzanne Bump determined that state acceptance of the federal McKinney-Vento Act related to the education of homeless students was an unfunded state mandate under the state’s Local Mandate Law.

The final budget also includes an appropriation of $45.5 million to reimburse regional school districts for a portion of the cost of transporting students. This is an important program for the state’s smaller and less-populated municipalities, where lengthy bus trips cannot be avoided. Regional districts and member cities and towns appreciate the increase in funding over the fiscal 2012 level.

The governor vetoed a budget provision that would have provided a limited cap on special education rates set by the state’s Operational Services Division.

In the next day or two, the Division of Local Services is expected to post fiscal 2013 Cherry Sheets for individual cities, towns and regional school districts based on the Legislature’s budget. To access the DLS analysis, visit http://www.mass.gov/dor/local-officials/municipal-data-and-financial-management/cherry-sheets/2013-cherry-sheets.

Download conference committee’s budget [Unrestricted General Government Aid and Chapter 70 numbers begin on page 189] (1.7M PDF)

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