Before finishing its formal session at the end of July, the Legislature overrode a series of gubernatorial vetoes to finalize the $41.3 billion state revenue and spending plan for fiscal 2019.

There are still loose ends from last year, however, that need to be tied up.

On July 13, Gov. Charlie Baker filed a fiscal 2018 close-out budget bill (H. 4758) that would result in a transfer of roughly $500 million to the state’s stabilization and other long-term liability accounts, while adding funds to a number of municipal and school aid accounts. The local spending includes a one-time $40 million distribution through the Chapter 90 formula for municipal road projects and a second $12.5 million supplemental appropriation for the special education circuit breaker program, which would bring the account to full funding for fiscal 2018.

The governor’s bill reflects final fiscal 2018 state tax collections that grew by an unexpectedly robust 8.6 percent over fiscal 2017 collections and $1.1 billion over the forecast for the year.

Heading into late August, the Legislature had not yet acted on the governor’s proposal, and it appeared that any action would not come until after Labor Day.

FY19 local aid
Funding levels for many municipal and school aid accounts in the final fiscal 2019 budget are higher than those proposed by the governor in January, when prospects for state finances were looking less positive.

The fiscal 2019 general appropriations act – now Chapter 154 of the Acts of 2018 – is based on a $28.4 billion forecast for state tax collections, which is $798 million higher than the original forecast made in January.

The final budget includes $1.1 billion for the Unrestricted General Government Aid account, an increase of $37 million over fiscal 2018, and $4.91 billion for Chapter 70 education aid., The budget funds the Chapter 70 program’s basic requirements and includes provisions to continue to implement the recommendations of the Foundation Budget Review Commission, phase in equity provisions, and fund minimum new aid at $30 per student.

The Division of Local Services has released updated Cherry Sheet amounts reflecting the final budget, and the Department of Elementary and Secondary Education has released updated calculations and guidance for various school aid accounts.

The fiscal 2019 budget law fully funds the Special Education Circuit Breaker program at $319 million. The budget appropriates $90 million for Charter School Impact Mitigation Payments, an increase of $9.5 million above the original fiscal 2018 level of funding, but still substantially below full funding.

The budget law appropriates $69 million to reimburse regional school districts for a portion of the cost of transporting students, a $7.4 million increase over last year, and $9.1 million for McKinney-Vento reimbursements for a portion of the cost of transporting homeless students as required under state and federal rules, an increase of $1 million.

The budget also provides $29 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. This includes $1.7 million set aside to ensure that Cherry Sheet PILOT payments next year are not reduced below the fiscal 2018 level due to the revaluation of state-owned land that takes effect next year.

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