MMA asks governor to support local aid investments in FY22 state budget

His Excellency Charles Baker
Governor of the Commonwealth
State House, Boston

Delivered Electronically

Dear Governor Baker,

On behalf of the cities and towns of the Commonwealth, we are writing with comments on H. 4002, the fiscal year 2022 general appropriations act on your desk for review and approval. The investments in cities and towns in this budget bill reflect a strong partnership with local government, as municipal and state leaders work together to deliver essential services, recover from the public health emergency, and get our economy back on track.

As you know, state tax collections have far exceeded expectations since you filed your budget proposal in January. We are pleased that with this new information, the Legislature’s $48.1 billion fiscal year 2022 state budget plan reflects an agreement between Senate and House leaders to increase tax revenue estimates for fiscal year 2022 by $4.2 billion. As a result, several key local aid accounts received higher funding levels and we respectfully ask for your support for these increases.

Unrestricted General Government Aid
The Legislature’s budget bill matches the 3.5% increase in Unrestricted General Government Aid in your original budget proposal, following the revenue-sharing framework that you have embraced from the first days of your administration. This represents an increase of $39.5 million over the fiscal year 2021 level of funding, bringing the total to $1.168 billion. We deeply appreciate your support and leadership on this essential municipal aid priority.

Chapter 70 School Aid
We strongly support increasing Chapter 70 aid by $220 million over fiscal year 2021, bringing the total to $5.503 billion. H. 4002 would fund the “goal rates” originally set forth in the Student Opportunity Act, which set a seven-year schedule that was to begin in fiscal year 2021 but was sidelined last year due to the public health emergency. This appropriation builds on the steps taken by you in House 1 to restart the process of implementing the Student Opportunity Act, by funding the SOA increases at a rate of one-sixth, rather than one-seventh, in order to return to the intended schedule. We respectfully ask for your support of this critical appropriation for school districts across the Commonwealth.

Grants to Address Student Enrollment Decline
We strongly support the $40 million appropriation in H. 4002 for a one-time, targeted grant program for school districts adversely affected by student enrollment decline during the COVID-19 public health emergency. As was stated during budget deliberations, this account may need to be revisited this fall if actual enrollment levels recover more quickly than anticipated, and the amount needed eclipses the $40 million reserve.

Special Education Circuit Breaker
We strongly support the $373 million appropriation for the Special Education Circuit Breaker, reimbursing school districts for the high cost of educating students with disabilities and meeting the statutorily required 75% reimbursement rate. This reimbursement rate, as well as the inclusion of costs associated with out-of-district transportation, reflects obligations outlined in the Student Opportunity Act.

Charter School Mitigation Payments
To address charter school mitigation payments, H. 4002 includes $154.6 million intended to reimburse school districts at 75%, the rate set forth in year one of the Student Opportunity Act implementation schedule. We strongly support this appropriation, while acknowledging that the funding formula for charter school mitigation payments still presents a major funding challenge for sending school districts.

New Reserve Fund Created for Future Student Opportunity Act Payments
We support the creation of a new $350 million special reserve account in H. 4002 to support future funding of the Student Opportunity Act.

School Transportation
The Legislature’s budget level funds regional school transportation at $82.1 million, while increasing transportation for homeless students under McKinney-Vento by $1 million over fiscal year 2021. Out-of-district vocational transportation is level-funded at $250,000. While these accounts do not meet the required funding according to DESE, we ask you to support the appropriations that are currently before you, and look forward to future efforts to build on these numbers.

Rural School Aid
We urge support for the Rural School Aid appropriation at $4 million, an important account for rural school districts, especially those struggling with declining enrollment. The special financial and operational challenges facing rural districts were not addressed in the Student Opportunity Act, although a special commission was established to study the long-term fiscal health of rural districts.

PILOT Funding
Recognizing the importance of Payments-in-Lieu-of-Taxes (PILOT) for state-owned land, H. 4002 increases the line item to $35 million (a $4 million increase over fiscal year 2021). Underfunding PILOT over the years has created a significant hardship for smaller communities with large amounts of state-owned property. While this amount is lower than the funding suggested in the State Auditor’s recent report on PILOT, we strongly urge support for the appropriation of $35 million.

Shannon Grants, Cybersecurity and Library Aid
The Legislature’s budget bill includes a $1 million increase for the Shannon Grants for gang violence prevention and intervention, and includes critical funding for the Mass Cybersecurity Innovation Fund, which provides important outreach and training programs for municipalities. The accounts for public libraries and regional public libraries would each see an increase of $1 million. We respectfully request support for these appropriations.

Public Employee Post-Retirement Work Hours
The Legislature’s budget bill also includes 149 outside sections, including Section 18, which would permanently increase the maximum number of permissible hours that may be worked by a retired public employee from 960 to 1,200. We strongly support this change and ask for your favorable consideration.

If you have any questions or need additional information, please do not hesitate to have your office contact MMA Legislative Analyst Jackie Lavender Bird at 617-426-7272, ext. 123, or jlavenderbird@mma.org at any time.

Thank you for your consideration of these key municipal priorities. We deeply appreciate your strong support and partnership with cities and towns.

Sincerely,

Geoffrey C. Beckwith
MMA Executive Director & CEO

Cc:
The Honorable Karyn Polito, Lieutenant Governor of the Commonwealth
Secretary Michael Heffernan, Executive Office of Administration and Finance
Senior Deputy Commissioner Sean Cronin, Division of Local Services