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Local Aid and Finance Legislature grants governor ‘expanded 9C’ budget-cutting authority
As the recession tightens its grip on the nation and Massachusetts, the House and Senate late yesterday approved legislation granting the governor expanded authority to unilaterally make cuts to state budget accounts without further action by the Legislature.
The vote by the Legislature follows a report filed a day earlier by the governor’s chief budget officer citing deepening economic woes and forecasting a new state budget shortfall for fiscal 2009 of $1.1 billion – beyond the $1.4 billion shortfall identified and closed in October.
The new law extends the governor’s existing budget-cutting authority in Chapter 29 of the General Laws to include the main local aid accounts used to balance municipal and school budgets: Chapter 70 education aid, Additional Assistance and Lottery distributions. These accounts were not affected by the October budget cuts.
Gov. Deval Patrick, who asked the Legislature for the “expanded 9C” budget-cutting authority, has not announced how he plans to close the new budget shortfall or the extent to which local government accounts might be cut. House leaders have said that local aid cuts could be as high as $500 million, though Administration and Finance Secretary Leslie Kirwan told reporters that the estimate seemed high.
The governor’s plan to close the new shortfall is not expected to be released until as late as Jan. 28, the date on which his budget recommendation for fiscal 2010 is expected to be filed with the Legislature. The governor is scheduled to speak at the MMA Annual Meeting on Friday, Jan. 23, and might provide a preview at that time.
The current $1.1 billion shortfall is attributable mainly to a $952 million reduction in the tax collection forecast for fiscal 2009. While the revised forecast shows weakness across all the primary state taxes, about half of the expected tax shortfall is attributable to falling capital gains tax collections due to declining financial markets.
The current forecast calls for fiscal 2009 tax collections to fall more than $1.4 billion (7 percent) short of final fiscal 2008 collections – and nearly $2 billion (9 percent) below the amount originally budgeted for the year.
Local Aid and Finance Legislature grants governor ‘expanded 9C’ budget-cutting authority
Legislature grants governor ‘expanded 9C’ budget-cutting authority
As the recession tightens its grip on the nation and Massachusetts, the House and Senate late yesterday approved legislation granting the governor expanded authority to unilaterally make cuts to state budget accounts without further action by the Legislature.
The vote by the Legislature follows a report filed a day earlier by the governor’s chief budget officer citing deepening economic woes and forecasting a new state budget shortfall for fiscal 2009 of $1.1 billion – beyond the $1.4 billion shortfall identified and closed in October.
The new law extends the governor’s existing budget-cutting authority in Chapter 29 of the General Laws to include the main local aid accounts used to balance municipal and school budgets: Chapter 70 education aid, Additional Assistance and Lottery distributions. These accounts were not affected by the October budget cuts.
Gov. Deval Patrick, who asked the Legislature for the “expanded 9C” budget-cutting authority, has not announced how he plans to close the new budget shortfall or the extent to which local government accounts might be cut. House leaders have said that local aid cuts could be as high as $500 million, though Administration and Finance Secretary Leslie Kirwan told reporters that the estimate seemed high.
The governor’s plan to close the new shortfall is not expected to be released until as late as Jan. 28, the date on which his budget recommendation for fiscal 2010 is expected to be filed with the Legislature. The governor is scheduled to speak at the MMA Annual Meeting on Friday, Jan. 23, and might provide a preview at that time.
The current $1.1 billion shortfall is attributable mainly to a $952 million reduction in the tax collection forecast for fiscal 2009. While the revised forecast shows weakness across all the primary state taxes, about half of the expected tax shortfall is attributable to falling capital gains tax collections due to declining financial markets.
The current forecast calls for fiscal 2009 tax collections to fall more than $1.4 billion (7 percent) short of final fiscal 2008 collections – and nearly $2 billion (9 percent) below the amount originally budgeted for the year.
Written by MMA Legislative Director John Robertson
