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Local Aid and Finance Legislative leaders announce 4% local aid cut for FY11
After deciding not to enact a Local Aid Resolution prior to debate on the state’s fiscal 2011 state budget, House and Senate leaders instead issued a joint statement today telling cities and towns to expect cuts of up to 4 percent in the two main Cherry Sheet accounts.
The statement, released by Rep. Charles Murphy, chair of the House Ways and Means Committee, and Sen. Steven Panagiotakos, chair of the Senate’s budget committee, warned municipal and school officials to expect cuts in the Unrestricted General Government Aid and the Chapter 70 education aid accounts that together total almost $5 billion.
Some school districts would face cuts of less than 4 percent – or no cuts at all – if the full reduction would reduce spending below the minimum “foundation” level.
It would be the third straight year of cuts to the two main local aid accounts.
The statement did not address any other local aid accounts, nor did it include a list of aid amounts for individual municipalities and school districts, as is the custom with a Local Aid Resolution.
The proposed lower funding level for municipal aid would drop payments to cities and towns to $899 million, a cut of $416 million (32 percent) since fiscal 2008. Funding for the Unrestricted General Government Aid account comes from a combination of Lottery revenues and state tax collections. Because Lottery revenues are expected to rebound this year and next, to $798 million available for distribution in fiscal 2011, this means the state tax contribution to municipal aid would fall by $392 million from the fiscal 2008 level – or almost 80 percent – in the legislative plan.
The governor’s fiscal 2011 recommendation for Chapter 70 increased the state tax contribution to education aid by $178 million to cover the temporary federal funds used in fiscal 2010 and a small additional amount needed to ensure that all districts could spend at the foundation level and to prevent cuts that would have occurred through the school aid formula. Even after the proposed education aid cut outlined in the legislative statement, the state tax contribution to Chapter 70 would still increase by $56 million (due to the loss of federal stimulus funds).
The House is expected to begin its fiscal 2011 state budget debate on April 26, with the Senate to follow beginning the week of May 24.
• MMA statement in response to legislative announcement of local aid cuts
Local Aid and Finance Legislative leaders announce 4% local aid cut for FY11
Legislative leaders announce 4% local aid cut for FY11
After deciding not to enact a Local Aid Resolution prior to debate on the state’s fiscal 2011 state budget, House and Senate leaders instead issued a joint statement today telling cities and towns to expect cuts of up to 4 percent in the two main Cherry Sheet accounts.
The statement, released by Rep. Charles Murphy, chair of the House Ways and Means Committee, and Sen. Steven Panagiotakos, chair of the Senate’s budget committee, warned municipal and school officials to expect cuts in the Unrestricted General Government Aid and the Chapter 70 education aid accounts that together total almost $5 billion.
Some school districts would face cuts of less than 4 percent – or no cuts at all – if the full reduction would reduce spending below the minimum “foundation” level.
It would be the third straight year of cuts to the two main local aid accounts.
The statement did not address any other local aid accounts, nor did it include a list of aid amounts for individual municipalities and school districts, as is the custom with a Local Aid Resolution.
The proposed lower funding level for municipal aid would drop payments to cities and towns to $899 million, a cut of $416 million (32 percent) since fiscal 2008. Funding for the Unrestricted General Government Aid account comes from a combination of Lottery revenues and state tax collections. Because Lottery revenues are expected to rebound this year and next, to $798 million available for distribution in fiscal 2011, this means the state tax contribution to municipal aid would fall by $392 million from the fiscal 2008 level – or almost 80 percent – in the legislative plan.
The governor’s fiscal 2011 recommendation for Chapter 70 increased the state tax contribution to education aid by $178 million to cover the temporary federal funds used in fiscal 2010 and a small additional amount needed to ensure that all districts could spend at the foundation level and to prevent cuts that would have occurred through the school aid formula. Even after the proposed education aid cut outlined in the legislative statement, the state tax contribution to Chapter 70 would still increase by $56 million (due to the loss of federal stimulus funds).
The House is expected to begin its fiscal 2011 state budget debate on April 26, with the Senate to follow beginning the week of May 24.
• MMA statement in response to legislative announcement of local aid cuts
Written by MMA Legislative Director John Robertson
