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Legislature stalls local aid cuts

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November 19, 2009

The day after the House and Senate ended formal sessions for the year, the Legislature today gave final approval to a supplemental budget bill that gave Gov. Deval Patrick some but not all of the provisions he requested to help close a $600 million fiscal 2010 budget shortfall.

During debate on the bill, House Ways and Means Committee Chair Charles Murphy told House members that the bill included $484 million to help close the budget shortfall.

The governor immediately expressed disappointment with the bill, however, saying it failed to fully close the budget gap, so it was not immediately clear whether he would veto some or all of it.

The Legislature did not approve a $10.8 million cut to the Cherry Sheet Payment-in-Lieu-of-Taxes (PILOT) program or a $5 million cut to the Police Incentive Pay Program (Quinn Bill), both of which were proposed in the supplemental budget recommendation filed by the governor on Oct. 15. The governor does have the authority to cut these accounts unilaterally using his powers under Section 9C of Chapter 29, but he has not yet announced his plans.

The governor has already used his 9C authority to cut a variety of municipal and school aid accounts, including aid to libraries and student transportation reimbursements to regional school districts.

The governor had also asked the Legislature to grant him expanded 9C authority in order to make cuts in the main municipal and school aid accounts and other accounts outside of Section 9C later in the year, if needed. The Legislature did not grant the governor expanded authority, although it has done so in past years, including last year, when tax collections dropped throughout the year.

The supplemental budget bill would transfer $11 million from the Smart Growth Housing Trust Fund to the state’s General Fund to help balance the state budget. The Trust Fund provides payments to cities and towns that opt into Chapter 40R, the Smart Growth Zoning Law.

Earlier this year, $7 million was transferred from the Smart Growth Trust to the state’s General Fund. With this latest transfer, only $4 million remains in the fund.

While the MMA is concerned about this transfer, the Legislature did not drain the entire trust, as had been proposed by the governor. When the Legislature returns in January, the MMA will pursue legislation to expedite the disposition of state surplus land to provide much-needed revenue to replenish the Smart Growth Trust.