Legislative leaders urge caution on local aid figures

After nearly a month of legislative hearings on the governor’s fiscal 2012 state budget recommendation, House and Senate budget leaders are warning cities and towns that funding for local aid accounts could be lower than the amounts proposed by the governor and included on preliminary Cherry Sheets prepared by the Division of Local Services.

The message came on March 9 during debate on a local aid resolution offered in the House by Rep. Brad Jones of Reading. Jones’s resolution, which did not pass, would have committed the House to the same amounts proposed by Gov. Deval Patrick for Chapter 70 education aid and three smaller aid accounts and to level funding of the Unrestricted General Government Aid account, the main municipal aid account. (The governor proposed to cut UGGA by $65 million, or about 7 percent.)

During debate in the House, budget committee chair Brian Dempsey of Haverhill told House members that more time was needed to evaluate the governor’s budget recommendation before making a commitment to municipal and education aid accounts. Dempsey said that it might be possible to release local aid numbers before the House takes up its budget in mid-April.

Senate budget committee chair Stephen Brewer, meanwhile, told State House reporters that he wouldn’t rule out a local aid resolution this year, but that he wanted more certainty concerning revenues and necessary expenditures before doing so. Brewer expressed the same concerns during an MMA Legislative Breakfast Meeting in Barre on March 11.

The MMA had been asking the Legislature to approve a local aid resolution by mid-March.

Last year, House and Senate leaders released a local aid “statement” on March 12 announcing minimum local aid amounts for fiscal 2011. The statement notified municipalities and school districts that cuts to the two main municipal and education aid accounts would not exceed 4 percent and that every school district would be funded at the “foundation” level. The final budget, approved in June, adhered to these numbers.

While economic and state tax revenue forecasts have been improving since last fall, the governor and the Legislature still must close a major budget shortfall in fiscal 2012 caused in large part by the depletion of temporary federal economic stimulus funds as well as growth in state health care accounts due to rising costs and caseload growth. The governor proposed ambitious health care savings initiatives to help balance his budget recommendation, but it remains unclear to what extent the Legislature will go along with his plans. With new taxes and fees off-the-table in the House, any reduction in the proposed savings would have to be made up by cutting other programs.

The governor filed his $32 billion fiscal 2012 state budget recommendation on Jan. 26. The House normally approves a budget by the end of April, with the Senate finishing its own version by late May. A final budget bill is typically sent to the governor in time for the start of the fiscal year on July 1.