Governor signs supplemental budget with winter relief, other investments

Gov. Maura Healey today signed a fiscal 2026 supplemental budget bill into law with $1.56 billion in education and transportation investments, including $100 million to help municipalities with costs associated with the harsh winter season.

The law includes the following items for municipalities:
• $152 million for reimbursements for extraordinary special education costs, including transportation, to supplement funding in the forthcoming fiscal 2027 state budget
• $100 million for cities and towns to address winter infrastructure damage and snow and ice removal budget deficits, with $80 million distributed based on road miles and $20 million allocated to communities that experienced extraordinary costs due to extreme weather
• $16.5 million to incentivize regionalization and shared services in rural school districts
• $20 million to support early literacy initiatives
• $8 million for rural school aid with $4 million intended to support fiscal 2026 and $4 million for fiscal 2027
• $3.75 million for maintenance of unpaved roads
• $2.5 million for school-based mental health support and wraparound services in public school districts
• $3 million for regional and out-of-district vocational school transportation
• $1 million for districts implementing bell-to-bell cell-phone-free policies in public schools
• $1 million for municipal grants for the purchase of truck safety devices

A policy item allows cities and towns to amortize snow and ice debts over three fiscal years. Another repeals the sunsetting of the local transportation network company (TNC) fee, which was scheduled for 2027.

“The MMA and local officials across Massachusetts deeply appreciate the Governor’s action today to sign critical funding for our communities into law,” said MMA Executive Director and CEO Adam Chapdelaine. “In particular, this supplemental budget provides $100 million in municipal winter relief, which will be essential for repairing roads and helping communities recover from a demanding winter season that strained local snow maintenance budgets. We are also grateful for targeted investments to help address special education costs, support regionalization efforts, strengthen rural schools, and other pressing local needs. Thank you to Governor Healey and our legislative partners for advancing these important resources, which will provide meaningful support to cities and towns as they continue to navigate a challenging fiscal environment.”

The budget includes appropriations to address several deficiencies across state government as well as policy provisions intended to adjust tax policies to soften revenue impacts anticipated from the federal One Big Beautiful Bill Act (OB3), which was enacted last July.

Another provision ties tax policy changes to the outcome of a potential ballot measure to lower the state income tax from 5% to 4%. Under the terms of the law, if the referendum were to pass, the state would permanently decouple the tax code changes from federal tax policies in order to mitigate an estimated $5 billion revenue loss.

The MMA and local leaders gathered on the State House steps in May to express strong opposition to the income tax reduction ballot question, saying it would have a devastating impact across the state budget.

The Legislature passed the compromise version of the budget bill on June 4, and sent it to the governor for her consideration.