From The Beacon, January 2015
The wrapping paper has been recycled, the bows are back in storage, and the New Year’s Eve champagne corks have been picked up off the floor. Many people may be preparing for a long winter’s nap, but not public officials. The end of the holiday season doesn’t translate into a slower pace or respite for local and state leaders. Indeed, January will ring in the New Year with a new governor, a new Legislature, a new budget shortfall, and a long list of new and urgent items.
Here’s a great way to kick off the New Year and ensure a fast start on our advocacy agenda: Come to the MMA’s Annual Meeting and Trade Show on Jan. 23 and 24. We’ll have 20 information-packed workshops, three high-level forums on emerging issues and challenges for communities, outstanding general sessions, and countless opportunities to network with colleagues from every corner of Massachusetts. We’ll have top officials from the Baker-Polito administration, experts on public leadership and change management, and much more.
“Our Cities and Towns: American Democracy at Work” is our 2015 Annual Meeting theme because local officials prove every day that American democracy is alive and well and working for the residents of Massachusetts and the entire nation. The Annual Meeting is an important tool for you to use as you construct a stronger tomorrow for Massachusetts, and as you demonstrate that local government is all about solving problems and producing results. Please register today!
Our conference is perfectly timed, too. Gov. Charlie Baker doesn’t have to file his fiscal 2016 state budget proposal until early March, and before that he’ll be developing and announcing his plan to close a mid-year state budget shortfall of between $750 million to $1 billion. The MMA Annual Meeting is the best place to learn the latest information about how the state will deal with its fiscal problems, and how the new administration intends to address local aid funding and policy going forward.
As the new Legislature convenes, the list of municipal issues pending at the State House is impressive, and includes everything from A to Z (from ambulance payments to zoning reform). These issues cover the widest possible range of measures and will impact cities and towns and their ability to deliver essential services, reduce reliance on regressive property taxes, promote a stronger federal-state-local partnership, enhance our economy, and ensure stability and recovery for communities and taxpayers.
In addition to working hard to safeguard community interests on all of these matters, the MMA Board of Directors met in October to establish a list of top priorities for the upcoming session. The Board’s priority list is meant to highlight those matters that naturally rise to the top due to urgency and magnitude, and will not lessen our aggressive efforts on any other issue. The MMA’s priority issues are ambitious, and include winning significant increases and full funding for municipal and school aid accounts, fixing the flaws and shortfalls in the 21-year old Chapter 70 education funding formula, enacting a multi-year Chapter 90 bond bill at $300 million a year, and continuing to work on securing meaningful reform of other post-employment benefits (OPEB).
Here’s a look at the top issues and goals that the board set for 2015:
• Fighting for local aid: The MMA’s top priority will continue to be winning local aid to fund essential municipal and school services. In the fiscal 2016 state budget, this will include increasing Unrestricted General Government Aid by at least the same rate as the growth in state tax revenues. Depending on the expected growth in state taxes, this should translate into a $40 million to $50 million increase in UGGA. Further, Chapter 70 aid should be increased to get all communities up to foundation, provide $100 per student in minimum aid to all districts, and accelerate the phase-in of the target share reforms. Essential reimbursement programs must be fully funded, including the Special Education Circuit Breaker program, the regular and regional school transportation accounts, McKinney-Vento transportation of homeless students, charter school reimbursements, and PILOT payments. Further, it is imperative that the state reject any effort to set conditions or earmarks on local aid, as attempts by the state to micromanage cities and towns inevitably lead to inefficiencies and undermine the local process that allows community citizens to determine the best way to build and fund
• Investing in local roads and bridges through Chapter 90: The MMA’s goals are clear: win a multi-year reauthorization of Chapter 90 funding at $300 million, indexed to inflation, and secure the release of the remaining $100 million from the fiscal 2015 authorization that was withheld by the Patrick administration. The good news is that Gov. Baker pledged to release the $100 million immediately after taking office in early January.
Two years ago, the MMA released a report documenting that cities and towns across the state need to spend at least $562 million every year just to bring local roads into a state of good repair, the industry standard for ensuring well-maintained roads in good condition. Currently, municipalities spend far less because of inadequate resources and because, for most cities and towns, Chapter 90 is the only source of funds for road construction and repairs.
Funding the Chapter 90 program at $300 million annually, with an inflation-based adjustment in future years, will close a portion of the huge gap. Chapter 90 funding is also the most effective and efficient way to ensure regional equity, sharing transportation revenues in a fair way in every corner of the Commonwealth. Further, cities and towns face such a backlog of need that the increase will immediately result in visible and necessary construction and repair projects on local roads across Massachusetts.
Investing more in Chapter 90 funding to improve the quality of local roads will actually save taxpayers millions of dollars a year, as the federal Department of Transportation has documented that once a local road is in a state of good repair, every dollar invested to keep it properly maintained will save $6 to $10 in avoided repair costs that become necessary to rebuild the road when it fails due to a lack of maintenance.
• Updating the Chapter 70 foundation budget framework and increasing the state’s overall share of K-12 funding: The state is beginning to revisit the four corners of the Chapter 70 foundation budget framework, primarily through the reauthorized Foundation Budget Review Commission, with MMA President and Attleboro Mayor Kevin Dumas representing the MMA. In addition to reviewing the need to fix obvious flaws, such as undercounting the cost of employee benefits and special education, one of the important issues the MMA wants to push is developing a long-term plan to increase the state’s share of education spending from 42 percent of the foundation budget up to 50 percent.
The clearest indicator that Chapter 70 aid and the foundation budget framework are insufficient can be found in the annual school budgets adopted by nearly every city, town and school district in the state. Over the past decade, cities and towns have appropriated a larger and larger amount from local property taxes to fund school programs, far above the required “net school spending” level called for under the law. This reflects the inadequacy of the foundation budget. Local leaders have been forced to increase property taxes and reduce spending on other important municipal services because the state’s education funding framework is obsolete and insufficient. In fiscal 2014, local government school spending above what is required totaled nearly $1.7 billion, more than double the fiscal 2004 above-required amount. The estimate for fiscal 2015 is that communities are diverting even more from the property tax to fund their schools, because the foundation budget framework is obsolete.
• Supporting solutions to the OPEB funding crisis: Over the next 30 years, our communities are facing a $30 billion unfunded liability to pay for retiree health insurance, a staggering burden that is totally unaffordable for taxpayers. Without major reform now, these costs will drive up local property taxes and force painful cutbacks in essential services that are vital to our economy. Without reform, cities and towns will be forced to reduce the number of teachers in the classroom, police officers on the streets, and firefighters on call for emergencies. Every service from public works to public health will be impacted.
It is important to be clear that local officials and the MMA are calling for OPEB reform in order to protect public sector retiree benefits in both the short and long term. Cities and towns are committed to providing retirees with excellent health insurance benefits, but these benefits must be affordable and sustainable for local taxpayers. Otherwise, the resulting fiscal crisis will squeeze out funding for vital services, force layoffs of public employees, and drive up local property taxes.
The MMA will be working with local officials, legislators, retirees, employees and all stakeholders to increase awareness of the critical importance of this issue, and will be urging action on a comprehensive set of reforms that protect the ability and authority of cities and towns to manage their costs now, and provide a sustainable framework for the future.
There’s a lot of work ahead in 2015, but that’s a good thing, because it means there’s a lot of progress that can be made. The more we can accomplish, with state and local officials working together, the more we can demonstrate to Washington, D.C., and to other states that American democracy is alive and well. We just need more collaboration, more joint efforts to solve problems, and more focus on delivering results.
That’s why this year’s Annual Meeting is so important. We’ll leave there in full partnership mode, working together on vital issues to build our communities and a stronger future for Massachusetts.
Best wishes for a happy and healthy New Year, and see you at Annual Meeting!
MMA’s Annual Meeting will launch action-packed year
From The Beacon, January 2015