On July 31, the House and Senate passed a $56.2 billion state budget bill for fiscal 2024 that has significant increases for a number of key local accounts.

Both chambers took quick action on a compromise bill (H. 4040) that was released by a six-member House-Senate conference committee the previous evening.

Gov. Maura Healey has 10 days to approve the spending appropriations and proposed law changes, veto certain items, or return items with amendments.

In a major win for cities and towns, the Legislature’s budget bill increases Unrestricted General Government Aid by 3.2% ($39.3 million), a critical priority pushed by the MMA throughout budget deliberations, and $15 million more than the 2% increase proposed by the governor in her budget bill in March.

The budget significantly increases Chapter 70 school aid over fiscal 2023, bringing the total to $6.5 billion. The 119 “minimum-aid” school districts across the state will receive an increase of $60 per pupil in their Chapter 70 funding, instead of the statutory $30 per pupil minimum new aid amount.

There are also increases of $63 million for the Special Education Circuit Breaker, $15 million for rural schools aid, and $51.5 million for Payments-in-Lieu-of-Taxes for state-owned land.

The budget bill also reflects an agreement between Senate and House leaders on how to spend the $1 billion in anticipated revenue generated by the voter- approved surtax on annual incomes over $1 million, which, by law, can be spent on transportation or education programs. The Legislature’s budget includes an additional $100 million for local road and bridge maintenance (distributed through a blend of the Chapter 90 formula and road miles), $100 million for extraordinary relief for eligible school building projects, $50 million for a Green School Works school infrastructure grant program, and $69 million for universal free school meals.

“On behalf of cities and towns across Massachusetts, we applaud the significant investments that the Legislature is making in our communities, especially in unrestricted municipal aid, increased funding for our local roads and key infrastructure, and important school programs,” said MMA Executive Director Geoff Beckwith.

The Division of Local Services will be posting preliminary Cherry Sheet estimates for each city, town and school district based on the Legislature’s budget.

The Legislature’s budget includes $1.27 billion for Unrestricted General Government Aid, the state revenue-sharing program that helps cities and towns fund municipal services. With property taxes tightly capped by Proposition 2½, cities and towns rely on state revenue sharing to provide municipal and school services, ensure safe streets and neighborhoods, and maintain vital infrastructure — services that are fundamental to the state’s economic recovery and competitiveness.

Chapter 70
The Legislature’s $6.5 billion in Chapter 70 aid represents a commitment to fund the Student Opportunity Act on schedule, with fiscal 2024 as year three of a six-year implementation.

The Legislature also recognized the challenge facing 119 “minimum aid” districts by doubling the minimum aid increase to $60 per student.

Special Education Circuit Breaker
The Legislature’s budget provides $504 million for the Special Education Circuit Breaker, which reimburses school districts for the high cost of educating students with disabilities.

Charter school mitigation payments
The enacted budget includes $232.6 million for charter school mitigation payments (7061-9010), which would fund the state’s statutory obligation as outlined in the Student Opportunity Act.

School transportation
The Legislature’s budget funds regional school transportation at $97 million, representing a reimbursement rate of 90% of estimated costs for fiscal 2024 as estimated by the Department of Elementary and Secondary Education.

The budget fully funds the McKinney-Vento account for transportation of homeless students at $28 million, and funds out-of-district vocational transportation at $1 million, an increase of $750,000 over fiscal 2023.

Rural School Aid
The Legislature’s budget includes $15 million for rural school aid (line item 7061-9813), providing assistance to eligible towns and regional school districts. The grant program helps districts facing the challenge of declining enrollment to identify ways to form regional school districts or regionalize certain school services to create efficiencies.

The Legislature’s Payments-in-Lieu-of-Taxes increase, to $51.5 million, is intended to ensure that no municipality would see a decrease in its PILOT payments due to recent valuation changes.

Fair Share revenue
The budget allots $1 billion in anticipated revenue generated from the voter-approved Fair Share Amendment, which took effect on Jan. 1 of this year. The surtax will fund additional education and transportation programs in fiscal 2024. Important funding for municipalities includes the following:
• $100 million in supplemental aid to support the construction and maintenance of municipal roadways, with at least half of the funding distributed based on each municipality’s total share of road mileage
• $100 million in supplemental grants for school construction projects already approved for financing by the Massachusetts School Building Authority. This funding would address significant and unanticipated cost escalations in recent years that are having an adverse impact on previously approved MSBA projects
• $69 million to help codify the universal school meals program, which would provide free lunches at public schools for all students, regardless of household income
• $50 million for a Green School Works grant program, administered through the DESE, to provide financial support to K-12 districts to install or maintain clean energy infrastructure, further investing in schools while helping to support local climate action and promoting energy efficiency

MassHealth crossover payments for EMS
The Legislature’s budget includes an outside section that would provide financial relief for emergency medical service providers for the transport of patients who are eligible for both Medicare and MassHealth. The section would provide “MassHealth crossover” reimbursements for dual-eligible transports, which would provide additional assistance to emergency medical services providers to support ongoing efforts to recruit and retain staff. The MMA has partnered with the Fire Chiefs of Massachusetts, Professional Firefighters of Massachusetts, and the Massachusetts Ambulance Association in support of this provision.

Lottery proceeds
The Legislature’s budget protects Lottery proceeds as the primary source of discretionary local aid for cities and towns by rejecting a provision to create an iLottery platform that would divert proceeds to programs outside of unrestricted general government aid. For more than 50 years, the mission of the Lottery has been to support municipalities and protecting this funding source has been a key advocacy priority for MMA.

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