Legislature sends FY19 budget to governor

The House and Senate on July 18 approved and sent to the governor a $41.9 billion budget bill for fiscal 2019 that reflects six weeks of negotiations over differences in spending and law changes.

Funding levels for many municipal and school aid accounts are higher in the final legislative budget (H. 4800) than they were in the recommendation filed by Gov. Charlie Baker in January, when prospects for state finances this year were less positive.

The governor has 10 days to review the budget bill and make decisions on what to approve and what to veto or send back with proposed changes. Legislators then have four days to review those vetoes, because the formal legislative session ends on July 31.

Unrestricted General Government Aid
H. 4800 would appropriate $1.1 billion for the Unrestricted General Government Aid account, an increase of $37.2 million over the fiscal 2018 level of funding. The 3.5 percent increase reflects the policy of increasing general municipal aid at the same rate as the growth in state tax collections in the consensus tax forecast. This policy has been adopted by the governor, House and Senate since fiscal 2016.

Chapter 70
The compromise budget bill would appropriate $4.91 billion to fund the basic requirements of Chapter 70 education aid and provisions to continue to implement the recommendations of the Foundation Budget Review Commission, phase in target share funding for communities where the local contribution exceeds the target share amount, and fund minimum new aid at $30 per student.

The Legislature’s budget provides a Chapter 70 increase of $57 million above the amount originally proposed by the governor in January. The bill adopted the Senate plan to close 100 percent of the target share gap and establish an enhanced English Language Learner foundation budget factor.

H. 4800 also would supplement Chapter 70 by providing $12.5 million for assistance to school districts affected by changes in how low-income students are counted. This amount is included in the appropriation item, but not in the Section 3 allocation.

Special Education Circuit Breaker
The final spending plan adopted the Senate proposal to fully fund the Special Education Circuit Breaker program at $319.3 million, through which the state provides a measure of support for services provided to high-cost special education students. This is critically important, and represents a $33.2 million increase above last year’s general appropriations act.

Charter school mitigation
The budget would appropriate $90 million for charter school impact mitigation payments. This reflects an increase of $9.5 million above the original fiscal 2018 level of funding, which is a step forward. This account remains substantially underfunded, however, and full funding for this program remains a top priority for the MMA.

Regional school transportation
H. 4800 would appropriate $68.9 million to reimburse regional school districts for a portion of the cost of transporting students. This is a $7.4 million increase over fiscal 2018.

McKinney-Vento
H. 4800 appropriated $9.1 million for this account to reimburse municipalities and school districts for a portion of the cost of transporting homeless students as required under state and federal rules. This is an increase of $1 million over the fiscal 2018 appropriation.

PILOT
H. 4800 would appropriate $28.5 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.

Shannon anti-gang grants
H. 4800 would provide $8 million for the effective Shannon anti-gang grant program, which has helped cities and towns respond to and suppress gang-related activities.

Reserve fund for municipal improvements
H. 4800 includes $2.8 million for the District Local Technical Assistance Fund, which helps support local efforts to regionalize local government services, and $2 million to support the Community Compact Cabinet program to facilitate the adoption of municipal best practices in cities and towns.

Law changes
H. 4800 drops sections that would have created a $2 surcharge on each rental car transaction in the Commonwealth to help fund an expanded municipal police training program. The Legislature is advancing this proposal in a separate bill, and Gov. Baker has proposed funding training programs with surplus tax revenues.

The final legislative budget also dropped law changes related to funding the Community Preservation Act and improving the accountability of charter school law.