Who is a member?
Our members are the local governments of Massachusetts and their elected and appointed leadership.
Eight days into the new fiscal year, House and Senate budget negotiators have reached agreement on a $38.14 billion state budget plan for fiscal 2016, which will be approved this afternoon by votes in each branch.
The governor will have 10 days to review, approve or veto hundreds of line item appropriations and outside sections. In the meantime, the state is maintaining operations through a temporary budget that runs through the end of July.
As recommended by the House-Senate budget conference committee, the Legislature’s budget bill (H. 3650) would increase overall expenditures by approximately 3.5 percent, as the state seeks to close a projected $1.8 billion structural budget deficit by restraining spending and eliminating up to 5,000 state jobs through a hiring freeze, attrition and an early retirement program.
In terms of local aid, the Legislature’s budget makes progress on many municipal priorities, including a $34 million increase in Unrestricted General Government Aid, as proposed by Gov. Charlie Baker and requested by the MMA.
The Legislature also added more than $50 million to key municipal and education aid accounts and reimbursement programs above the amount recommended by the governor in his March budget proposal.
The budget would expand the earned income tax credit for low-income workers by an estimated $71 million, and fund that expansion by eliminating a corporate tax break on recognized income. A Senate-approved provision to freeze the state income tax rate at 5.15 percent was not included in the Legislature’s budget bill.
On the issue of reforming the Massachusetts Bay Transportation Authority, the Legislature’s budget includes a three-year suspension of the Pacheco anti-outsourcing law and provides for a Fiscal and Management Control Board to oversee the MBTA. The governor had requested a strong control board with approval over binding arbitration decisions. The Legislature’s version does not grant the panel authority over binding arbitration awards.
Unrestricted municipal aid
In a major win for cities and towns, the Senate, House and governor’s budgets all supported $979.8 million for UGGA, a $34 million increase over current funding. This will be the largest increase in discretionary municipal aid in nearly a decade. Every city and town will see its UGGA funding increase by 3.6 percent.
Special Education Circuit Breaker
In another victory for cities and towns, the Legislature’s budget would fully fund the Special Education Circuit Breaker program. The House-Senate budget plan would provide $271.7 million, an $18.3 million increase above fiscal 2015. The governor’s original budget proposal would have level-funded the program at $253.4 million, but the MMA made full funding a top priority, and the Legislature responded. This is a vital program that every city, town and school district relies on to fund state-mandated services.
Kindergarten development grants
The Legislature’s budget would maintain funding for Kindergarten Development Grants at $18.6 million in fiscal 2016, which is a major victory for the 117 communities and school districts that depend on these funds. The governor’s budget would have eliminated all funding. A reduction or elimination of funding would jeopardize expanded kindergarten programs all throughout the state.
Regional school transportation reimbursements
The Legislature’s budget would restore $7.5 million to regional school transportation funding, providing a total of $59 million for the upcoming year. Last November, former Gov. Deval Patrick used his Section 9C emergency budget-cutting powers to reduce this program down to $51.5 million, and Gov. Baker’s fiscal 2016 budget proposal would have level-funded the account. The Legislature’s budget is a major step forward for communities with regional school districts.
Chapter 70 minimum aid
The Legislature’s budget includes a $111.2 million increase in Chapter 70 education aid, with a provision providing every city, town and school district with an increase of at least $25 per student, an improvement over the $20 per student amount originally proposed by the governor. The Legislature’s appropriation is $5.9 million more than the recommendation in the governor’s budget submission. The increase would be used to ensure the $25 per student minimum aid level and to slightly accelerate the implementation of the target share provisions enacted in 2007.
Charter school reimbursements
Under state law, cities and towns that host or send students to charter schools are entitled to be reimbursed for a portion of their lost Chapter 70 aid. The state fully funded the reimbursement program in fiscal 2013 and 2014, but underfunded reimbursements by approximately $34 million in fiscal 2015. The governor had proposed level-funding charter school reimbursements in fiscal 2016 at $76.8 million, which would guarantee another major shortfall and result in cutbacks for the majority of students who remain in the traditional school setting. The Legislature is proposing a $3.64 million increase, to $80.5 million. The lawmakers’ action to increase funding is appreciated by local school districts, but the account is still significantly underfunded.
McKinney-Vento reimbursements
The Legislature’s budget would add $1 million to increase fiscal 2016 reimbursements for the transportation of homeless students to $8.35 million, the same as proposed by the governor. While the account remains below the full reimbursement called for under the state’s unfunded mandate law, this would be the first increase since fiscal 2013.
Payments-in-lieu-of-taxes
The Legislature’s budget would level-fund PILOT payments at $26.77 million.
Library aid accounts
The Legislature’s budget would fund library grant programs at $19 million, a $500,000 increase above fiscal 2015 post-9C levels.
METCO
The Legislature would fund METCO at $20.14 million, a $2.23 million increase above fiscal 2015 post-9C levels.
Shannon anti-gang grants
The Legislature is proposing $7 million for Shannon anti-gang grants, the same amount proposed by Gov. Baker in March.
Vocational education transportation
Last year, Gov. Patrick wiped out all fiscal 2015 funding for vocational education transportation using his 9C powers. The Legislature’s budget would restore $1.75 million for fiscal 2016.
Community Preservation Act
During fiscal 2015, 156 cities and towns collected the local Community Preservation Act surcharge and are eligible for state matching grants in fiscal 2016. The Division of Local Services estimates that the balance in the state trust fund will be sufficient to provide a first-round match of only 18 percent of the surcharge levied by each city and town. This would be the lowest state match in the program’s history. The Legislature’s budget would devote up to $10 million of any fiscal 2015 year-end state budget surplus to supplement the fiscal 2016 state match, a significant boost for all CPA communities.
Emergency medical services
Although the House and Senate budgets each included differently worded provisions prohibiting “pay the patient” practices by insurance companies for ambulance services, the Legislature’s final budget does not include any language addressing this problem. Municipalities maintain that “pay the patient” undermines their ability to fund and operate effective and efficient ambulance services that are at the core of emergency medical response in Massachusetts and forces them to pursue their own residents to recoup thousands of dollars in ambulance expenses, a system that is inefficient and subject to abuse.
The House had adopted an amendment to ban “pay the patient” practices, with language stating that municipalities would be authorized to set a fair rate for ambulance services, preventing insurance companies from shifting costs to local property taxpayers through below-cost reimbursements. The Senate budget would have given ultimate rate-setting authority to the secretary of Health and Human Services, a provision the MMA opposed because removal of local control over ambulance rates would have created large budget problems for cities and towns.
Because this issue has not been resolved, the MMA will continue its efforts to ban “pay the patient” practices by insurance companies.