Who is a member?
Our members are the local governments of Massachusetts and their elected and appointed leadership.
The $32 billion state spending plan for fiscal 2012 filed by Gov. Deval Patrick yesterday starts a slow and challenging recovery from the harsh economic recession that began in 2007 and lasted 18 months.
While state tax collections are expected to grow by $741 million next year, to $20.5 billion, due to a continuing but moderate economic rebound, this growth will cover less than half of almost $2 billion in temporary federal economic recovery funds and one-time state revenues and savings that were used to fund state and local programs in fiscal 2011.
To balance next year’s budget, the governor’s plan would constrain and cut spending, including a fourth year of cuts in the main Cherry Sheet municipal aid account. The plan would also use $200 million from the state’s stabilization fund and $185 million in one-time actions, while increasing state revenues by $140 million.
Another key part of balancing the budget is an ambitious set of savings initiatives in the state’s health insurance and other programs. According to the Massachusetts Budget and Policy Center, the governor hopes to save almost $400 million for the state through procurement changes, limits on provider payments, and increased co-payments and benefit limits for state health care programs, even as caseload growth is predicted.
• Link to the governor’s budget documents, including Section 3 local aid amounts
• Link to preliminary Cherry Sheets based on the governor’s recommendation
• Link to Department of Elementary and Secondary Education for Chapter 70 worksheets
Local aid
The governor’s budget, known as House 1, would cut or level-fund most municipal aid accounts while proposing increases in state funding for certain key school aid programs. The Cherry Sheet Unrestricted General Government Aid account would be cut by $65 million (about 7 percent) to $833 million. At this level, the largest municipal aid account would be $481 million lower than it was at the beginning of fiscal 2009, a drop of 37 percent.
The budget would level-fund the Payment-in-Lieu-of-Taxes account at $25 million and the underfunded Police Incentive Pay Program (Quinn Bill) at $5 million.
The governor’s budget would increase the state appropriation for Chapter 70 school aid by $140 million to $3.99 billion. The increase would cover the $21 million in federal state fiscal stabilization fund (SFSF) funds allocated through the school aid formula aid last year and provide $119 million in new foundation aid for 99 school districts to reach the foundation level of spending.
The school aid proposal for next year does not include in the aid base the $200 million in federal grants from the Education Jobs and Medicaid Assistance Act allocated through the Chapter 70 formula last August and available for use over fiscal 2011, 2012, and into fiscal 2013. If all of the education jobs grants are included in the base, total funding through Chapter 70 drops by $82 million and would result in almost three quarters of the state’s school districts facing reductions of between 5 and 7.5 percent. The impact of the Governor’s proposal locally will depend in part on how much of the jobs grants were used this year and how much was set aside locally for fiscal 2012.
The governor’s budget would increase state funding for the special education “circuit breaker” by $80 million to help offset the loss of temporary federal special education funds. The budget would also level-fund the student transportation reimbursement account for regional school districts at $41 million.
The governor first announced his local aid recommendations at the opening session of the MMA Annual Meeting on Jan. 21 in Boston. At the MMA’s Annual Business Meeting a day later, Rep. Charles Murphy, who was then chair of the House’s budget committee, reminded local officials that the governor’s numbers are only recommendations.
“The numbers that the governor put out yesterday are not the numbers that you’re going to see [in a final state budget],” Murphy said. “Could be close, could be more, could be less. We don’t know.”
The House and Senate are expected to hold hearings on the state budget beginning in February. The House normally approves a budget by the end of April, with the Senate finishing its own version by late May. Last year, House and Senate leaders released a special “statement” on March 12 announcing minimum levels of municipal and school aid for fiscal 2011.
In addition to his budget recommendation, the governor also filed several companion bills, including legislation that would change local decision-making on health insurance, require all eligible local retirees to enroll in Medicare, and end the property tax exemption for equipment owned by telecommunications companies. Another bill would modernize retirement law, including setting later retirement ages for full benefits.