Who is a member?
Our members are the local governments of Massachusetts and their elected and appointed leadership.
The Honorable Aaron Michlewitz, House Chair
The Honorable Michael J. Rodrigues, Senate Chair
The Honorable Denise C. Garlick, House Vice Chair
The Honorable Cindy F. Friedman, Senate Vice Chair
The Honorable Todd M. Smola, Ranking House Member
The Honorable Viriato M. deMacedo, Ranking Senate Member
Joint Committee on Ways and Means
State House, Boston
Dear Chair Michlewitz, Chair Rodrigues, Vice Chair Garlick, Vice Chair Friedman, Ranking Member Smola, and Ranking Member deMacedo:
On behalf of cities and towns across the state, we are writing to express our appreciation for the many provisions in the fiscal 2020 budget bills approved by the House (H. 3801) and Senate (S. 2235) that benefit and support the communities of the Commonwealth. Both bills reflect a commitment to a fiscal partnership with municipalities.
We thank the House and Senate for advancing a state budget framework that increases Unrestricted General Government Aid (UGGA) by $29.7 million, a key priority for communities, funds the basic parts of Chapter 70 education aid, including increasing per-student minimum aid to $30 per student, and increases funding for the Special Education Circuit Breaker program.
While there are a number of areas where the House and Senate agree on funding levels for municipal and school aid accounts, there are many budget provisions where the two branches will have to resolve important differences. In this letter, we offer municipal government’s position on important funding and policy proposals that would impact communities and local taxpayers, and we urgently and respectfully ask you to take action on all of these matters to support the interests of the cities and towns of the Commonwealth.
We ask you to please invest in essential municipal and school programs, and we also ask that you protect local government from proposals that would restrict or interfere with their management authority and decision-making powers.
In this letter, we have highlighted the most important and visible budget issues that impact cities and towns, and respectfully ask you to support those provisions and funding levels that most benefit the communities of the Commonwealth.
Unrestricted General Government Aid (UGGA)
The House and Senate both appropriated $1.129 billion for the Unrestricted General Government Aid (UGGA) account (1233-2350 and section 3), an increase of $29.7 million over the fiscal 2019 level of funding. The 2.7 percent increase reflects the policy of increasing general municipal aid at the rate of growth in state tax collections reflected in the consensus tax forecast. This policy has been adopted by the Governor and the House and Senate since fiscal 2016, and is supported by the MMA.
Recent increases in UGGA have been very important locally to support municipal and school programs in cities and towns across the Commonwealth. Funding for this vital municipal aid program reflects the commitment of Lottery and other gaming revenue to support local government services and avoid over-reliance on the property tax. Most of the Cherry Sheet UGGA distribution next year will be covered by gaming revenue, with only a small contribution from state tax collections.
We respectfully ask the Conference Committee to include the full UGGA amount voted by the House and Senate. This is a high priority for cities and towns.
Chapter 70 School Aid and Local Contributions
The House and Senate both fund the basic requirements of Chapter 70 education aid (7061-0008 and Section 3) and adopt provisions to continue to implement the recommendations of the Foundation Budget Review Commission, but take different approaches.
We strongly support a funding increase for Chapter 70 school aid that is sufficient to allow all municipal and regional school districts to reach the “foundation” level of spending, implement the target share equity provisions adopted in 2006, and provide an adequate amount of minimum aid that ensures that all schools receive a suitable and appropriate increase in fiscal 2020. A significant majority of school districts only receive minimum aid, which is why the minimum aid aspect of Chapter 70 is so important.
We support the $30 per student minimum aid amount included in the House and Senate bills, as this is higher than the original $20 per student amount proposed by the Governor in House 1. As you know, the MMA is requesting that future minimum aid increases be substantially higher, a key issue for the comprehensive education finance legislation that will be considered later in the legislative session.
We support the provision in Section 3 to close 100 percent of the target share gap for those cities
and towns where the local contribution requirement exceeds the target share amount.
We support the interim plans in the House and Senate bills to continue the implementation of the recommendations of the Foundation Budget Review Commission for the Employee Benefits and Fixed Charges (mainly health insurance for school employees) factor. We support the interim plans in the House and Senate bills to implement Commission recommendations related to English language (EL) students and “economically disadvantaged students.” Updating the factors for disadvantaged or high-need students was an important recommendation of the Foundation Budget Review Commission.
The branches take different approaches to updating the EL student factors and in how “economically disadvantaged students” and low-income students are accounted for in state school funding programs. We have not taken a specific position on the approach, as long as the EL and low-income factors are adequate and implemented within a reasonable time.
The House uses a higher factor than the Senate for two of three EL categories and the same or lower factors for economically disadvantaged students. The House also sets aside funds for a grant program to provide academic support for low-income students. The Senate proposes higher weighting for districts with the highest concentrations of EL and low-income students. There are significant differences in the preliminary Cherry Sheets for some districts, although the impact of the House grant program on individual districts cannot be determined.
Following these policies, we respectfully request and strongly support a Chapter 70 distribution of $5.176 billion with adequate funding for low-income students.
Rural Schools
We support the $2.5 million appropriation in the Senate budget bill (7061-9813) that would provide one-time funding for rural schools and would require the Department of Elementary and Secondary Education (DESE) to make recommendations for funding in fiscal 2021. We also support separate legislation filed in the House (H. 409) and Senate (S. 2185) that would begin to address the rural schools issue.
Special Education Circuit Breaker
We strongly support the Senate appropriation for full funding of the Special Education Circuit Breaker Program (7061-0012) at $345 million, through which the state provides a measure of support for services provided to high-cost special education students. Under Chapter 71B of the General Laws, the state’s statutorily required share is 75 percent of costs that exceed four times the state average per pupil foundation budget. This is an essential program that provides critical funding to assist all school districts with the increasingly burdensome and volatile cost of complex and expensive special education services. Funding below the $345 million level would create significant financial challenges for every school district.
Charter School Finance
We strongly support the House appropriation of $113 million for Charter School Impact Mitigation Payments (7061-9010). This funding level reflects an increase of $23 million above the current fiscal 2019 level of funding. While this is an impressive and welcome increase, we recognize that this statutory reimbursement program would still fall far short of full funding.
The growing diversion of Chapter 70 school aid from local public schools to support charter schools has placed a major financial burden on cities and towns, a problem made more acute as the state grants more charters and existing charter schools expand. For fiscal 2020, it is estimated that cities and towns will be assessed $724.9 million in local school revenues to fund charter schools, an increase of $61.8 million (9.3 percent) over the estimated level this year. These school aid deductions are impacting a large number of communities, including some of the state’s poorest and most financially distressed cities and towns.
Unfortunately, the welcome interim steps in the House and Senate budget bills to reform Chapter 70 are undermined by the current charter school finance system. Many cities and towns are facing “net negative” school aid receipts next year because of how charter schools are financed. Chapter 70 reform must be accompanied by an overhaul of how charter schools are financed, otherwise a large number of cities and towns and local public schools will be left behind.
Both the House and Senate budget bills would make permanent changes to charter school finance law and would appropriate different amounts for fiscal 2020 reimbursements (mitigation payments).
Both branches would reduce the 6-year funding schedule to a 3-year schedule (100-60-40). This is the schedule proposed by the Governor in H. 1 and H. 70. Both branches would increase the capital assessment paid to charter schools from $893 per student to $938.
The plan submitted by the Governor and House would change the way that reimbursements (mitigation payments) are calculated, moving from the current method based on growth in assessments (incremental local costs) to growth in the number of local students attending a charter school (enrollment based). This permanent change to charter school finance law would significantly reduce payments to local public school districts. The Senate would retain the current method based on costs. We strongly oppose the enrollment-based provision because of the negative financial impact this would have on cities and towns and local public schools, and strongly urge you retain the cost-based reimbursement framework.
The House would add a new category of reimbursements called “supplemental assistance,” drafted to provide relief to municipalities and districts with high assessments relative to Chapter 70 school aid. This approach provides a framework that would benefit a number of districts in fiscal 2020, and, importantly, could be used in the future to prevent cities and towns from facing negative growth in net school aid. We estimate that about 70 municipal and regional districts are facing real aid reductions in net Chapter 70 aid in fiscal 2020, because their net losses to charter schools are greater than any new aid under the Section 3 distribution. We strongly support the House’s supplemental assistance provision, and also commend other approaches to this critical revenue problem, including the MMA’s bill (H. 418).
Regional School District Student Transportation
We urge support for the Senate appropriation of $75.9 million to reimburse regional school districts for a portion of the cost of transporting students. This account (7035-0006) is vital to all regional districts and their member cities and towns, particularly in sparsely populated parts of the state. According to DESE, full funding would require more than $90 million.
Out-of-District Vocational Student Transportation
We urge support for full funding for reimbursements due under statute for part of the cost of transporting students to out of district vocational education placements. Chapter 74 of the General Laws requires the state to reimburse cities and towns for the cost of transporting students to out-of-district vocational education programs (7035-0007). This reimbursement program recognizes the significant expense of providing transportation services for out-of-district placements, as these students must travel long distances to participate in vocational programs that may not be available locally. While short of full funding, we support the Senate appropriation to provide $250,000 for this account.
McKinney-Vento Homeless Student Transportation
We urge support for the House appropriation of $10.1 million for this account (7035-0008) to reimburse municipalities and school districts for a portion of the cost of transporting homeless students as required under state and federal rules. The State Auditor has determined that the requirement is an unfunded mandate that the state is obligated to pay. We note that the $10.1 million appropriation would still not reach full funding, which is why it is important to select the highest option before the conference committee.
Payment in Lieu of Taxes on State-owned Land
We urge support for the Senate appropriation of $30 million to pay a portion of the payment-in-lieu-of taxes amount due to cities and towns to offset the property tax exemption for state-owned land (1233-2400). There are approximately 450,000 acres of state-owned land in cities and towns with a total valuation of about $2.9 billion. Funding for the PILOT program is particularly important for cities and towns across the Commonwealth that host and provide services to state property and facilities. Because even small changes in the state-set valuation of property can create volatility in the distributions received by municipalities, we ask that the conference committee add hold-harmless language to ensure that no community receives a fiscal 2020 distribution that is below their fiscal 2019 amount.
We support section 122 in the Senate budget bill that would establish a commission to evaluate the PILOT program and make recommendations for reform.
Shannon Anti-Gang Grant Program
We urge support for the Senate level of funding of $11 million for the highly effective and valuable Shannon Anti-Gang Grant Program (8100-0111) that has helped cities and towns respond to and suppress gang-related activities.
Reserve Fund for Municipal Improvements
We urge support for appropriation item 1599-0026 that would provide funding for the District Local Technical Assistance Fund (DLTA) that helps support local efforts to regionalize local government services and supports the Community Compact Cabinet program to facilitate the adoption of municipal best practices in cities and towns.
Department of Labor Relations
We urge support for the Senate appropriation of $2.9 million (7003-0900) for the Department of Labor Relations (DLR), which would increase funding in order to maintain a current level of service. This funding would support the increased work of the DLR to resolve labor disputes quickly and effectively.
Joint Labor-Management Committee
We support the Senate appropriation of $250,000 (7003-0902) for the Joint Labor-Management Committee (JLMC). The JLMC provides important support, assistance and intervention in collective bargaining disputes involving municipal police officers and firefighters in order to facilitate good faith negotiations and constructive long-term relationships with municipal employers.
Firefighter Extractor Program
We support that part of appropriation item 8324-0000 in the Senate bill, which would provide grants to help cities and towns purchase extractors. The purpose this section is to reduce risks to firefighters associated with wearing contaminated protective clothing through the acquisition of recommended washing equipment for regular cleanings. We believe that the adoption of this amendment would positively contribute to the wellbeing of municipal firefighters, and also preserve the integrity and increase the longevity of firefighters’ clothing.
Early Voting Costs
We support section 34 in the Senate bill that would require the state to reimburse cities and towns for costs associated with the 2014 early voting law. Reimbursements would be based on an annual determination by the State Auditor of the mandated incremental costs in section 25B of Chapter 54 of the General Laws.
Community Preservation Act
Both the House and Senate would increase recording fees at the Registers of Deeds to raise revenues for the Community Preservation (CPA) Trust Fund (sections 50A and 119). This would provide an estimated $36 million in new funds, and more than double the base percentage match for all 175 CPA cities and towns beginning in November of 2020. Both branches would also set aside a share of the fiscal 2019 year-end surplus to supplement the state match in November of 2019 (sections 12-13 and 32-33). We support these provisions, and thank you for including them in your budget plans.
SUMMARY
Again, we would like to express our deep appreciation to you, the House and Senate leadership, and the members of the House and Senate for the thoughtful consideration of municipal needs and concerns throughout the development of the budget bills before the Conference Committee.
This is a critical time for our economy, and for cities, towns and local taxpayers, yet we can only reach our full potential for statewide growth and job creation if all 351 cities and towns have the resources to adequately serve the residents and businesses of the Commonwealth.
Please do not hesitate to contact us at any time if you have any questions or need additional information by having your office reach out to me or MMA Legislative Director John Robertson at 617-426-7272 ext. 122 or jrobertson@mma.org.
Thank you very much for your support, dedication and commitment to the cities and towns of Massachusetts.
Sincerely,
Geoffrey C. Beckwith
Executive Director & CEO
cc: The Honorable Robert DeLeo, Speaker of the House
The Honorable Karen Spilka, Senate President