Updated as of 8/9/2023
Massachusetts government is funded on a fiscal year basis. Fiscal Year 2024 runs from July 1, 2023 - June 30, 2024. This page will give you updates on the FY2024 budget process. This page lists newest actions first.
Governor Healey Signs $56B Budget, Agreeing to Most Spending and Policy |
August 9, 2023.....In her most significant legislative action since taking office in January, Gov. Maura Healey on Wednesday signed into law her first annual state budget. Governor Healey approved a $56 billion budget for fiscal year 2024 that increases spending roughly 6.2 percent over the budget enacted last summer, distributes newly available revenue from a surtax on high earners, and implements a slew of major policy changes, including permanently offering all students free school meals. Transportation Highlights Include: MassDOT
MBTA In addition to sales tax revenue, the FY24 budget includes:
Regional Transit Authorities (RTAs)
Fair Share Investments
The first-term Democrat used her veto pen to slash a total of $272 million in spending, and she also spiked an outside section that would have pumped $205 million of one-time funding into the budget. Healey sent back eight outside sections with proposed amendments and approved the other 103, including measures that will expand access to subsidized health care, and allow high school graduates without legal immigration status to tap into in-state tuition rates and financial aid at public colleges and universities. Flanked by Lt. Gov. Kim Driscoll, Cabinet secretaries and legislative leaders for a bill-signing ceremony in her office, Healey had nothing but praise to offer for the budget despite the delay in getting it to her desk. Fiscal year 2024 began July 1. "This budget makes our state more affordable, competitive and equitable," Healey said. "It will make a real and meaningful difference in the lives of people across Massachusetts, lowering their costs, expanding access to opportunity, improving the quality of their life." For the first time, the spending plan makes use of revenue newly available from a 4 percent surtax on annual personal income above $1 million that voters approved in November, which must be earmarked for education and transportation uses. The budget divides an expected $1 billion in surtax money into $524 million for education and $477 for transportation. Investments include the launch of a "MassReconnect" program that supports free community college for students ages 25 and older, MBTA infrastructure improvements and a permanent universal school meals option. Limited Changes Head Back to LegislatureAltogether, Healey vetoed $272.4 million in spending from 35 different line items. She wrote in a signing letter that the net spending reduction totaled $205 million "after revenue offsets." The Massachusetts Taxpayers Foundation said $71 million in federal reimbursement for a MassHealth reduction offsets the total figure. More than half of the dollars Healey vetoed came from a single cut. Healey slashed $142.8 million from a "MassHealth Fee for Service Payments" line item, reducing it to about $3.6 billion total. She described that in her veto summary as "the amount projected to be necessary." Healey also trimmed $35 million from a center-based child care rate increase, $18 million in emergency aid for elderly, disabled and children, $5.9 million from Department of Children and Families family resource centers, $5.6 million from the special education circuit breaker reimbursement fund, $3.75 million for adult mental health and support services, and more. Many areas she cut are still set to receive tens or hundreds of millions of dollars, or funding from other line items and programs. The governor returned eight policy riders with proposed amendments on topics including pyrite and pyrrhotite in concrete, alcohol sales in gaming establishments, and MassHealth ambulance services.
Two Healey amendments would alter the timing of a pair of programs she said she supports: allowing employees to supplement paid family and medical leave benefits with accrued time off, and eliminating communication costs for incarcerated individuals and their families. The free phone calls measure -- which lawmakers approved as part of the fiscal year 2023 budget but could not get across the finish line after Gov. Charlie Baker tied it to an unrelated policy fight -- would launch on Dec. 1, 2023 under Healey's proposal instead of being retroactive to July 1. "It was just good, collective common sense from all involved that we needed a little bit more time to be able to get it done," Healey said. Lawmakers have until Nov. 15, the final day for formal sessions this year, to take up any veto overrides unless they suspend their rules. Healey's amendments do not face a strict timeline for legislative action and could remain in limbo into 2024. Spending Increases Up and Down the BillK-12 schools are in line to receive a $594 million, or 9.9 percent, increase in Chapter 70 funding as the budget continues to move toward full implementation of the 2019 school funding law known as the Student Opportunity Act. One percent of the total funding, about $558 million, will go toward the Executive Office of Energy and Environmental Affairs, which Healey lauded as a major milestone reflecting the state's commitment to softening the impacts of climate change and moving to a clean-energy future. The budget calls for a major increase in funding for the emergency assistance family shelter program, pushing that line item to $325 million or 48 percent more than the FY23 budget as enacted last summer. Massachusetts shelters have been overwhelmed by a sharp increase in families seeking assistance, many of them immigrants, prompting Healey on Tuesday to declare a state of emergency. In a letter appealing to federal officials for action, Healey estimated the state is spending more than $45 million per month on programs for the affected families. If the spending keeps up at that pace for a full year, it would total $540 million, significantly more than the budget appropriates. "When it comes to what we're experiencing as a state, particularly with regard to the influx of newly arrived migrants, no amount of state resources [or] infrastructure is adequate to deal with what is really a humanitarian crisis, a geopolitical issue, that has no immediate timeline of abating," Healey said at her budget event Wednesday. "That is why I issued the emergency declaration, and we will certainly collectively use all means necessary, but we do need federal assistance in the form of funding as well as work authorizations." The budget also includes $475 million in Commonwealth Cares for Children (C3) grants to early education providers, a 3.2 percent increase in unrestricted general government aid (UGGA), and $173 million in so-called Chapter 257 rate increases for human service providers. One outside section Healey approved will revive and make permanent a lapsed pandemic-era eviction diversion program, which requires courts to pause eviction proceedings for failure to pay rent if a tenant has a pending application for rental aid. Another launches a pilot program increasing eligibility for ConnectorCare health insurance, which the Massachusetts Health Connector advertises as offering "$0 or low monthly premiums, low out-of-pocket costs, and no deductibles." The threshold for eligibility will shift from 300 percent of the federal poverty level to 500 percent. The pilot could provide a new option for some Bay Staters who lose MassHealth coverage amid a massive, year-long campaign to trim enrollment for the first time since the pandemic began. Officials have estimated the redetermination process could shrink the MassHealth rolls by up to 400,000 people and free up $1.9 billion in FY24 state spending to be directed elsewhere. House Speaker Ron Mariano said he is "especially proud" of the ConnectorCare expansion, forecasting it would allow at least 50,000 more people to acquire health insurance, which is required under state law. "These are transformative decisions. You're talking about people who don't have health care, who have to worry about getting a flu shot, have to worry about getting a vaccine shot, let alone a physical," Mariano said. "These people now will have an opportunity to get access to health care." The budget also calls for adding two seats to the MBTA's Board of Directors, one of which would be appointed by the mayor of Boston. Still Waiting for Tax ReliefHealey agreed with the Legislature's proposal to place a $581 million hold in the budget designed to cover the expected impact of a tax relief package, which remains mired in Democrat-led negotiations more than a year after lawmakers first began debating the idea. "We must not, however, lose sight of the need for tax relief," Healey wrote in her signing letter. She added, "The people of Massachusetts are relying on us to get tax relief done as soon as possible." Asked Wednesday if she gave legislative leaders a deadline to achieve consensus, Healey demurred and struck a softer tone than her signing letter. "The important thing is, I think, we all recognize that tax relief is something we want to accomplish for purposes of making life more affordable for residents, more competitive for our state," she said. "There are a lot of good ideas already out there and on the table, and this is the work of government and policymaking. So I know people will be hard at work in the days and weeks ahead and look forward to that process." Senate President Karen Spilka then interjected, telling reporters that "so much of what's in the budget is a form of relief for individuals and working families." The free school meals program will save participating families up to $1,200 per student per year, she said. Spilka also argued that a $100 million investment in school construction will ensure that 30 communities facing higher project costs "do not have to put that on the backs of property taxpayers." Healey's budget signature came on the 40th day of the fiscal year it funds after Democrat negotiators who chair each branch's Ways and Means Committee struggled for weeks to achieve consensus on a final bill. Lawmakers approved the final measure on July 31, a month into the fiscal year and the second-latest of any annual budget in the last 22 years. Healey had no criticism to offer Wednesday -- she said "policymaking takes time" and that the budget "got it right" -- while Mariano voiced a defense of the Legislature's slow pace. "We read a lot about how late this budget was, but I think I'd just like to remind everyone that the two committees on Ways and Means, in the Senate and the House, were negotiating some tax cuts, a major budget, and spending of the millionaire's tax. All three required negotiations between the two bodies, with different priorities in each body," Mariano said. "So we weren't surprised that it went a little long, but I'm constantly surprised that everyone seems to have forgotten what was at stake here and what we were trying to accomplish." -END- |
House and Senate Vote to Pass FY2024 Budget; sending it to Governor's Desk |
On Monday, July 31, 2023, the House and Senate voted to approve the compromise FY2024 budget and send it to Governor Maura Healey's desk. She has ten days to review the budget and issue any vetoes. On 7/31/23, Gov. Maura Healey in the morning signed the $6 billion interim budget that lawmakers quickly passed Friday. Funding from the initial $6.66 billion interim budget was projected to last only until the early days of August and the second interim spending plan that Healey signed will ensure that state government remains funded while the governor takes up to 10 days to review the full-year budget compromise that legislative negotiators filed Sunday night. Whenever Governor Healey signs a fiscal year 2024 budget into law, it will immediately displace the interim budget. The interim budget says that it "shall cease to be operative on the effective date of the general appropriation act and all actions taken under this section shall apply against that general appropriation act." |
House and Senate File $56.2B Budget Accord |
Legislative negotiators filed a compromise $56.2 billion annual state budget Sunday night, packing major education, transportation and health care policy measures and spending into an overdue fiscal 2024 accord that is expected to win House and Senate approval on Monday. [Conference committee budget: Spending | Municipal and Regional Aid | Outside Sections] According to House and Senate officials, the budget compromise includes a Senate measure that will allow students without legal immigration status to qualify for in-state tuition rates, and state financial aid, at public colleges or universities here if they have attended a Massachusetts high school for at least three years or obtained their GED here. Also in the higher education arena, the budget provides $50 million to support free community college across all campuses by fall of 2024, including $38 million for free community college programs for students aged 25 or older and for students pursuing degrees in nursing starting in the fall of 2023. It also includes a House-backed initiative requiring schools to provide school meals to all students free of charge, a program that began in the pandemic with federal money and which has been retained by the state due to its popularity. The program will cost about $172 million. In the early education and care sector, negotiators agreed to $475 million for the Commonwealth Cares for Children (C3) grants, a funding level that budget analysts said represents an historic commitment. The initiative draws funding from three sources: the state's General Fund ($270 million), a transitional escrow fund ($102.5 million) and an early education trust fund ($102.5 million). The House backed a measure to allow online Lottery sales to fund early education and child care grants; Senate negotiators did not agree to that idea. Budget analysts said the conference committee bill lays out $6.59 billion in Chapter 70 K-12 public education funding, an increase of $604 million beyond fiscal 2023, and doubles the minimum Chapter 70 aid level from $30 to $60 per pupil. Unrestricted general government aid to cities and towns landed at $1.27 billion in the compromise, an increase of $39.4 million. In health care, ConnectorCare coverage eligibility will be expanded under a two-year pilot to individuals earning up to 500 percent of the federal poverty level, or $73,000 a year for an individual. Supporters say 47,000 to 70,000 residents will become newly eligible for more affordable coverage. The budget also requires state officials to create a standard, pre-hospital care protocol related to the assessment, treatment and transport of stroke patients by emergency medical services providers to a hospital designated by the Department of Public Health to care for stroke patients. State employees will also be able to take advantage of another measure that will let them access health insurance coverage on their start date or the first day of the first full month of their employment. Reviving the "free calls" initiative that nearly passed last session, the budget requires the Department of Correction and county sheriffs to provide voice communication services for free to people who are incarcerated. The budget also raises a spending cap and allocates state funding to allow schools that signed building project contracts before the COVID-19 pandemic and those that are working toward signing contracts to "catch up" with inflationary costs. According to information provided to the State House News Service on Sunday night, surtax appropriations of $1B in education and transportation break down as follows: • $69 million towards universal school meals; • $205 million for the MBTA; |
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State Government Funded For July As Budget Talks Continue |
The pressure to strike a state budget deal eased up June 26 when Acting Gov. Kim Driscoll signed an interim budget to keep the state's bills paid and payrolls funded well into July. The House and Senate on Monday sped the $6.66 billion interim budget back to the governor, who filed it last week. It effectively authorizes another month of funding for government services while negotiators work on details of a consensus annual budget. Overdue annual budgets have become the norm in Massachusetts, as Democrats who control the House and Senate show little concern about finishing the spending plan after the July 1 start of the fiscal year and governors from both parties offer little pushback. The annual budget has been signed into law after July 1 every year since at least 2011. |
| Conference Committee appointed |
Sens. Michael Rodrigues, Cynthia Friedman, and Patrick O'Connor were appointed to join Reps. Aaron Michlewitz, Ann-Margaret Ferrante, and Todd Smola on the conference committee that will work out the differences between the 2 budget documents. |
| Senate Approves $56B FY2024 State Budget |
The annual state budget season moved to the next phase on the evening of May 25 as the Senate unanimously approved a nearly $56B spending plan that ramps up spending while setting aside $575M for a tax relief plan that will be unveiled separately. Senators voted 40-0 to finalize their rewrite of the FY2024 budget first proposed by Gov. Maura Healey and already approved by the House. The next step will be the formation of a conference committee, to be announced next week, comprised over both Senators and Representatives that will work out the differences between the two legislative versions, ahead of the July 1 start of fiscal year 2024. That conference committee process will decide the fate of some of the most notable parts of the budget, including how it divides $1B in new income surtax revenues and whether to give undocumented students access to in-state tuition at public colleges and universities. Over the course of three days of deliberations, senators packed tens of millions of dollars more onto the budget's bottom line, mostly through earmarks for infrastructure projects and community organizations in their individual districts. The Senate approved more than 400 amendments, collectively adding $82.2 million in spending and pushing the bottom line to about $55.9 billion, a Senate Ways and Means Committee spokesperson said. Notable additions senators made include funding for kits to test whether drinks have been spiked amid a worrying rise in cases, another attempt to study congestion pricing and other transportation cost questions, and a tweak to a House-backed push to revive and make permanent an eviction diversion policy. The Senate also diverged from the House on its approach to tax relief. The House approved a tax relief bill (H 3770) -- estimated at a $587 million impact in FY24 and $1.1 billion once it fully takes effect over several years -- before tackling its budget bill. Senate Democrats were not ready to move ahead on tax relief so the Senate Ways and Means Committee instead factored in $575 million to cover tax relief in a bill that still has not yet emerged. Even without tax relief baked into the annual state budget, its specter loomed over much of the deliberations. Democrats successfully defended their push to prevent new surtax revenue from making it easier to trigger the kind of automatic tax rebates that taxpayers received late last year. |
| Senate Budget Debate |
The Massachusetts Senate began debate on its FY2024 budget proposal on 5/23/23. |
| Senators File 1049 amendments |
Senators filed 1049 amendments to the Senate Ways and Means Committee's FY12024 budget proposal by the May 12 filing deadline. Senate debate is planned to begin on May 23 |
| Senate Ways and Means Releases Budget Proposal on May 9 | The Senate Ways and Means Committee issued its $55.8 billion state budget bill on May 9, leaving room for about $575 million in future investments in tax relief, which the Senate budget chief said will be hitting the chamber floor for debate soon.
The timing of this release continues the fall back into the typical timetable used to develop the Commonwealth’s budget after Governor Healey was given additional time to file her first budget. The Legislature and Administration had previously agreed to base the FY24 budget development on the belief that state tax revenues are expected to rise 1.6% over the next fiscal year, or 4.1% when accounting for the $1 billion the administration expects to bring in from millionaires tax. To date, both Governor Healey and the House of Representatives used this expected revenue figure to develop their versions of the budget. Last week, however, the Department of Revenue announced that the state collected $4.782 billion in taxes in April, which is $1.435 billion or 23.1% below the most recent monthly benchmark projection. Ultimately, with only two months left in the fiscal year, the state so far has collected $703 million less than expected in tax revenues. Since the announcement, Governor Healey has attempted to portray a continued sense of optimism, saying that FY24 budget proposals should already factor in an economic slow down and that “we have the money there to make the investments in our people.” Senate leadership has not made any statements on how April’s revenue numbers will impact Senate budget debate or any tax reform proposal. With the release of the Senate Ways and Means budget, Senate members will have until the afternoon of Friday, May 12 to file amendments and a combination floor/remote debate is scheduled to begin the week of May 22, 2023. This plan is about $3.4 billion, or 6.5 percent, larger than the fiscal 2023 state budget signed by Gov. Charlie Baker last summer. The plan is $300 million over what Gov. Maura Healey proposed, and $400 million under the House's budget. The Senate Ways and Means Committee voted 16-0 to recommend the spending plan, an indication that the proposal will likely sail to passage when it hits the Senate floor later this month. Both the House and Healey's budgets had factored in a companion tax relief bill, which the governor estimated could have a $1 billion impact to state revenue next fiscal year. The House factored in $587 million next fiscal year for tax relief and up to $1.1 billion after a two-year phase-in period. |
| Senate Ways and Means to Release Budget Proposal on May 9; amendments due Friday at 2 pm. | The Senate scheduled its annual budget debate for May 23. The Senate Ways and Means Committee is expected to release its version of the fiscal 2024 budget on May 9. The Senate set a 2 pm Friday deadline for members to file amendments, giving committee staff and branch leadership the customary week to pore over the hundreds of add-on proposals before debate begins later in May. |
April Revenue Collapse Swings State Budget Into Red |
Source: State House News Service, Chris Lisinski, 5/3/23 3:22 PM MAY 3, 2023.....[Coverage Developing] State tax revenues collapsed well below expectations in April, shifting the year-to-date performance from about $870 million in the black to, by one measure, $703 million in the red. The Department of Revenue announced Wednesday it brought in $4.782 billion in April, typically the strongest month of the year for tax collections. That's $2.163 billion less than in April 2022, a drop of 31.2 percent, and $1.435 billion or 23.1 percent below the most recent monthly benchmark projection. "That's a pretty substantial shortfall, and it really does change the tax trajectory for the fiscal year," said Evan Horowitz, executive director of the Center for State Policy Analysis at Tufts University. "I don't think it imperils state spending or the solvency of the current fiscal year, but I do think it means there's not going to be a lot of money to play around with at the end of the year. It really does tighten the rings of this fiscal year." The development means state officials, who have been engaged in a prolonged era of spending growth, now face the kind of spending management decisions that some in elected office on Beacon Hill have never faced and which haven't surfaced since the budget tensions of Gov. Charlie Baker's first term. Through 10 months of fiscal 2023, Massachusetts has collected $703 million less than state budget chieftains originally expected to haul in by this point when they crafted benchmarks for the cycle, a reversal from the roughly $870 million above original benchmarks the state reported through March. "The decrease in April revenues largely represents a previously understood exposure to the fiscal year 2023 budget from capital gains and the timing of taxpayers' use of pass-through-entity credits that we are reviewing closely and will continue to monitor over the final two months of the fiscal year," Administration and Finance Secretary Matthew Gorzkowicz said in a statement. "We remain confident in our ability to work with our partners in the Legislature to adjust and utilize available resources to manage the budget and close the fiscal year in balance." Gorzkowicz and the Healey administration did not announce any immediate budget decisions. The secretary signaled he does not currently believe they will need to execute budget cuts, known as 9C cuts, to manage the shortfall. Without offering specifics, the administration also speculated about using "one-time funding sources generated by prior year surpluses." The sudden, precipitous drop after more than two years of rapid revenue growth alters the atmosphere on Beacon Hill, where lawmakers and Gov. Maura Healey have been pursuing aggressive increases in state spending and sizable new tax relief. With only two months remaining in the fiscal year, it could be difficult to trim state spending in a meaningful way. Massachusetts had more than $7 billion stashed away in its "rainy day" long-term savings fund as of March 14, according to figures House Democrats presented last week, and state government could tap into that money to paper over gaps this year. The House last week approved a $56.2 billion state budget for fiscal year 2024. Their plan is built on the assumption that Massachusetts will collect $41.4 billion in tax revenue next year, which legislative and Healey administration budget chiefs agreed to in January, as well as the initial impacts from a tax relief bill whose eventual size could grow to $1.1 billion annually. Senate Democrats are expected to roll out and then approve their own budget bill this month, and they have avoided committing to a specific timeline for a response to the House's tax relief proposal. Healey administration officials said the governor's tax relief plan "remains sound, reasonable and affordable fiscal policy" and that they don't currently plan to revisit the revenue estimates being used to build the fiscal 2024 state budget. [Alison Kuznitz contributed reporting] -END- |
| House Finalizes FY2024 Budget, Sends to Senate |
On the evening of April 26, the House voted 156-0 evening to send the Senate a $56.2 billion state budget (H 3900) for FY2024 that's predicated on hundreds of millions of dollars of tax relief tied up in a separate bill. During budget deliberations this week, representatives crafted two final mega-amendments packaging together hundreds of individual changes and earmarks dealing with energy, environmental affairs and housing (Consolidated Amendment "F") and labor and workforce development (Consolidated Amendment "G"), then approved them with a single vote each. The House added roughly $120 million in spending over the course of its three-day deliberations. The House's budget proposal would legalize online Lottery sales and direct revenue from that gambling expansion toward early education and child care grants. Democrats also lined up behind a measure that will make it harder for state tax revenues, bolstered by a new surtax on higher earners, to trigger the kind of automatic taxpayer rebates that caught Beacon Hill by surprise last summer. The Massachusetts Senate will consider their version of the budget bill in May, likely after they also roll out a counterproposal on tax relief that could inform the spending plan's bottom line |
| Massachusetts House Budget Amendments |
Massachusetts State Representatives filed a total of 1566 amendments to the FY2024 budget proposal by the deadline of 5 pm on April 14, 2023. The House is expected to group the amendments into bundles and then vote on the bundles. On April 24, the House will convene a full formal session to begin its days-long work on the $56.2 billion fiscal 2024 budget (H 3900) rolled out by the House Ways and Means Committee. Top House Democrats proposed a spending bill about $700 million larger than Gov. Healey's $55.5 billion budget, weaving in authorization for online Lottery sales to fund child care investments, an expanded no-cost phone calls program in prisons and jails, and different local aid levels. Representatives filed 1,566 amendments to the budget, most of them seeking earmarks for their districts. The House's budget sessions typically feature little action on the floor, and representatives instead make decisions behind closed doors about which amendments to approve and reject before attaching those changes using only a handful of consolidated mega-amendments. Roll calls are set to begin with the start of session at 11 AM. |
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House Ways and Means Issues Budget Proposal for FY2024 Bill is now H.3900 |
On April 13, 2023, House Speaker Ronald Mariano and House Ways and Means Chair Aaron Michlewitz officially released the House’s proposed budget for Fiscal Year 2024 (FY24). The proposed spending plan is about $700 million larger than what Governor Maura Healey filed and would reflect an increase of nearly $3.74 billion or 7.1 percent over the fiscal 2023 state budget enacted last summer. Their plan factors in a $587 million cost next fiscal year from a tax relief proposal that House Democrats unveiled on Tuesday and plan to advance on Thursday. Budget Amendments are due on Friday. The House plans to begin budget debate during the week of April 24, 2023. Like Governor Healey, House leaders plan to spend the $1 billion in revenue from a new surtax on high earners equally between education and transportation investments. Both bills would segregate surtax revenues into an Education and Transportation Fund, and Chairman Michlewitz said his committee’s budget proposal would deploy that money "100 percent on top of existing appropriations" rather than use it to replace other spending levels. House leaders recommended about $6.58 billion in Chapter 70 aid for schools, which they said would fully fund the third year of the K-12 funding reform law known as the Student Opportunity Act, plus a $7.86 million supplement to provide a minimum aid increase of $60 per pupil. On unrestricted general government aid (UGGA) that state government steers to cities and towns, House Democrats proposed $1.25 billion, or about $5 million less than the Governor proposed. For transportation, the House budget would steer $250 million in surtax money toward MBTA capital investments and $65 million toward a T workforce and safety reserve while also deploying $5 million toward the rollout of means-tested fares. Both the Governor's budget bill and the House Ways and Means bill would segregate surtax revenues into an Education and Transportation Fund, and Michlewitz said his panel's budget proposal would deploy that money "100 percent on top of existing appropriations" rather than use it to replace other spending levels. House officials say 1.25 percent of their budget would go toward state environmental agencies, a new spending milestone in the wake of several major climate and clean energy bills that have won approval on Beacon Hill in recent years. House leaders sought new investments in other higher education initiatives, including $50 million of surtax money to expand the High Demand Scholarship program to offer assistance to students pursuing "in-demand" professions. The bill also mirrors Healey's proposal to put $20 million toward a new MassReconnect program that would cover unfilled community college costs for adults older than 25 without a degree. House Democrats proposed about $6.58 billion in Chapter 70 aid for schools, which they said would fully fund the third year of the K-12 funding reform law known as the Student Opportunity Act. That's about as much in Chapter 70 funding as Healey sought, though the House bill also features an additional $7.86 million supplement to provide a minimum aid increase of $60 per pupil. The House bill funds charter school reimbursements at $230 million ($13 million less than Healey's budget), regional school transportation at $107 million ($10 million more) and the special education circuit breaker at $506 million ($3 million more). When it comes to unrestricted general government aid for cities and towns, often referred to as UGGA, House Democrats proposed $1.25 billion or a 1.6 percent increase over the current fiscal year, mirroring the projected growth in state tax revenues next year. Municipal leaders have been pushing for the state to expand UGGA beyond that tax revenue baseline, arguing that inflation and surging tax collections in recent years have left cities and towns behind. Massachusetts Municipal Association Executive Director Geoff Beckwith asked lawmakers last month to approve $1.3 billion in UGGA, a 6.13 percent increase. Budget amendments are due on
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Governor Presents her FY2024 Budget Proposal on March 1, 2023 |
Governor Maura Healey introduced her FY2024 budget recommendation today. This budget bill is current known as H. 1 Governor's FY2024 Budget Recommendation Healey Budget Shines Light On Transportation Agenda MassTaxpayers Foundation Analysis MassTaxpayers Foundation Summary of the Budget Proposal Gov. Maura Healey's FY2024 budget is a $55.5 billion package described as a "downpayment" on the governor's goals of making Massachusetts a more affordable place to live, driving the state's decarbonization push and addressing the impacts of climate change, and preparing students for careers in an evolving economy. The bottom line for fiscal year 2024 spending represents a 4.1 percent increase over the current year's budget as originally adopted last summer, exactly the same growth rate that the administration and lawmakers expect to see from state revenues in fiscal 2024 when accounting for $1 billion from the state's new income surtax. That $1 billion from the surtax on income in excess of $1 million will go under Healey's plans towards education ($510 million) and transportation ($490 million) and Administration and Finance Secretary Matthew Gorzkowicz said that some of the investments the new governor's first budget (H 1) proposes in those areas "would be very challenging" to have made without the new revenue stream. For transportation, the surtax revenues would go towards $181 million in MBTA capital investments, launching a $100 million municipal partnership program, providing $100 million for highway bridge maintenance and preservation, and making $25 million available in regional transit funding and grants. The budget plan also ratchets up funding for the Executive Office of Energy and Environmental Affairs, which sits at the center of the state's efforts to reduce carbon emissions to a net-zero level by 2050 and to electrify buildings, vehicles and more. EEA would get $543.6 million under Healey's budget -- an increase of $105.2 million or 24 percent that would allow the secretariat to hire 240 new staff members. The administration said it would be the first time that an annual state budget dedicates at least 1 percent of its total to EEA. On the education side, Governor Healey is proposing to use the surtax money to pay for $100 million in child care grants to providers, $140 million in higher education capital funding, the $20 million free community college program the governor outlined earlier Wednesday, a $93 million expansion of a state scholarship program, a $59 million effort to stabilize tuition and fees at UMass and other public higher education institutions, and more. Including the surtax investments, higher education would be in line for an increase of $371 million or 23 percent in the Healey budget. That includes a 3 percent increase to the base funding for each higher education segment, including the University of Massachusetts system. "Governor Healey and Lt. Governor Driscoll have made a bold statement about the importance of the University of Massachusetts to the socio-economic future of the Commonwealth," UMass President Marty Meehan said. "These transformational investments would expand access to our world-class education and enhance the impact of our statewide research enterprise. On behalf of the UMass community of 74,000 students, 17,000 faculty and staff, and 500,000 alumni, we thank the Healey-Driscoll administration for their commitment to UMass. After watching state revenues surge nearly 40 percent over the last two fiscal years, accommodating a nearly 11 percent increase in spending in the current budget, the administration and Legislature are preparing for a "slowcession" over the next year and a half -- not a downturn from the elevated revenue levels, but a definite handbrake on the eye-popping increases of recent years. The budget proposes:
She also telegraphed her plan to ask lawmakers to allocate $20 million to create MassReconnect, a program that will "offer students last-dollar financial support to cover the cost of tuition, fees, books and supplies as well as provide funding for career and wraparound support services to encourage retention and degree-completion." The governor's budget (H 1), which will be referred to the House Ways and Means Committee, will propose $46.9 million for early college and innovation pathways, a $14.4 million increase over this year's budget. The administration estimates that under its early college plans more than 18,000 students in the 2023-2024 school year will have the opportunity to earn up to 12 college credits before graduating. The pathways program will enroll more than 10,000 students in courses across "priority industries" including IT, engineering, health care, life sciences and advanced manufacturing, the administration said. And Healey earlier this week also rolled out a tax relief and reform package that could swell to cost as much as $1 billion annually. -END- |
Healey Outlines Local Aid Levels Ahead of Budget RolloutAfter Pushing for Boost, Munis Praise Proposal as "Strong First Step" |
The FY2024 budget proposal that Gov. Maura Healey will file March 1 will boost the largest source of state education aid by almost 10 percent in what the administration said would be the biggest percentage increase since the last millennium.
Local officials and then the general public got a preview of the first Healey-Driscoll state budget on February 23 when the administration shared preliminary local aid estimates based on the spending bill (H 1) that Healey will file by March 1, 2023. It was the first detailed look at some of the ways in which the new governor and her administration plan to make some of her priorities and campaign promises reality, and it offered an early check-in on the relationship between the new administration and the 351 cities and towns of Massachusetts. The governor's fiscal year 2024 budget will propose a total of $8.36 billion for local aid programs, which the administration said would be a $635 million or 8.2 percent increase over the final budget Gov. Charlie Baker signed for fiscal 2023. Along with $1.26 billion for general government aid (a $24.6 million or 2 percent increase), cities and towns would share $6.585 billion in Chapter 70 school funding (a $586 million or 9.8 percent boost). Both the House and Senate will rewrite the budget before sending a final version back to Healey in the early summer months. The Healey administration said the Chapter 70 total it will propose represents full funding of the Student Opportunity Act school finance reform law passed in 2019 and, if enacted, would be the largest increase since at least 1999. "The Student Opportunity Act calls for a historic investment in our schools, our students, our educators and their futures. Additionally, these funds will help cities and towns support their first responders, public works, youth violence prevention programs, housing production, cybersecurity and more," Healey said in a statement. The governor's statement added, "Lieutenant Governor Driscoll and I know that predictability and transparency from state government is essential for municipal leaders to serve their communities -- and we're committed to delivering just that." Administration officials released the local aid preview while Healey is on a family vacation in Florida and Lt. Gov. Kim Driscoll is visiting family in Georgia. The fiscal 2024 state budget will mark the third budget cycle for the Student Opportunity Act, which aims to address education equity gaps with $1.5 billion in new funds rolled out over a seven-year span. Among the pledges that the governor made in her first appearance before the Massachusetts Municipal Association last month, she said she would fully fund the landmark 2019 K-12 education funding law. "We know that the pandemic hit every student, every family and it widened disparities that existed in the first place," Healey said in January. "We need to really focus on getting our students back on track. Luckily, we have the Student Opportunity Act and federal aid that we'll rely on. The challenge is helping our school districts deploy those funds as quickly and as effectively as possible." A budget brief produced by the Executive Office for Administration and Finance said that the governor's budget would also "recommend a temporary change to allow school districts greater flexibility to spend nearly $1.5 billion in expiring federal funds and better coordinate funding streams without facing state financial penalties." Much of the roughly $2.9 billion in federal Elementary and Secondary School Emergency Relief money provided to Massachusetts school systems remains unspent. The first Healey budget will also fulfill another promise the governor made to the MMA: it will increase funding for school transportation reimbursement programs by $25.5 million or 24 percent over the current budget. The $97 million proposed for regional school transportation reimbursement would increase the state's reimbursement from about 80 percent to 90 percent of local costs, the $5.2 million for non-resident pupil transportation for vocational schools would increase the reimbursed share of those costs from less than 5 percent to 90 percent, and $28.7 million for homeless student transportation reimbursement would have the state footing 100 percent of those costs. The budget will also fully fund charter school reimbursements at $243 million and provide $7.5 million for rural school aid, a $2 million or 36 percent increase over fiscal 2023, the administration said. Unrestricted General Government Aid (UGGA) would be funded at $1.26 billion -- $24.6 million or 2 percent more than the current budget, reflecting a slightly larger boost than the forecast 1.6 percent increase in general state tax revenues on which the budget will be based. Healey said on Twitter that her administration "wants to help cities and towns fund the essential services they provide every day at a higher rate than what we expect for revenue growth next fiscal year." The Baker administration made it a practice to increase UGGA at the same rate as the projected increase in state tax revenue. Local officials last week told the administration that a similar increase in municipal support "won't cut it" this year. But while the 2 percent increase is still less than half of the 4.1 percent growth the state is expecting once projected revenue from the new surtax on income greater than $1 million is added to the equation, municipal officials were full of nice things to say about the new governor's first budget plan Thursday. "The local aid that the Healey-Driscoll Administration is proposing to allocate to cities and towns is a strong first step in helping us meet the needs of all of our residents," Revere Mayor and Massachusetts Mayors' Association President Brian Arrigo, who made the "won't cut it" comment last week, said in a statement provided by the governor's office. "By fully funding the Student Opportunity Act, Governor Healey and Lieutenant Governor Driscoll are sending a clear message that they are ready and able to support municipalities in our efforts to offer every student a high-quality education. I'm also grateful to see the administration take action to address a number of challenges municipalities are currently facing, from the high cost of special education to the difficulties we face regarding student transportation." The local aid budget brief that the administration circulated Thursday also alluded to an upcoming supplemental budget bill for fiscal year 2023 and said the administration will use it to propose "streamlining specific aspects of municipal accounting and local governance." By letting cities and towns know nearly a week ahead of the full budget rollout what they might be able to expect from the state in the budget year that starts July 1, Healey was also making good on her January promise to local officials that they "will be the first to know" once the so-called cherry sheets were available. "Good cities and towns don't happen by accident. As a former Mayor, I know that a strong partnership with the state is key," Driscoll tweeted Thursday afternoon. "We promised to let local leaders know what to expect from our budget so they can start planning to use it. Today, we followed through on that promise." -END- |
State Expecting Elevated Tax Revenues To Hold1.6 Percent Growth Expected, 4.1 Percent When Surtax Included |
State House News Service: JAN. 30, 2023.....The Healey administration and legislative budget managers agreed on Jan. 30 to build their upcoming state budget plans on the assumptions that they will have $40.41 billion in general state tax revenue to spend in the budget year that begins July 1 and an additional $1 billion in revenue from the state's new high-earner surtax that can be put towards education or transportation. The fiscal year 2024 consensus revenue agreement announced Monday would represent 1.6 percent growth over the latest estimate for fiscal year 2023 tax revenue, or 4.1 percent growth when adding the $1 billion in projected revenue from the surtax on income greater than $1 million to the equation. The surtax revenue, by law, is supposed to only be spent on education and transportation initiatives. "The Fiscal Year 2024 consensus revenue forecast lays the groundwork for a fiscally responsible FY24 spending plan that supports core services for residents and makes meaningful and sustainable progress in addressing the varied needs and issues facing the Commonwealth," Administration and Finance Secretary Matthew Gorzkowicz, who agreed to the growth figure with Ways and Means Committee chairs Rep. Aaron Michlewitz and Sen. Michael Rodrigues, said. "More importantly, the additional surtax revenue will allow for significant new investments in transportation and education that will make the Commonwealth more competitive, affordable, and equitable." Gov. Maura Healey is expected to file her first annual budget proposal by March 1. The House and Senate will redraft Healey's spending blueprint and debate their own versions, likely in April and May. Fiscal year 2024 begins on July 1, but Massachusetts has rarely had its full-year budget in place by that date in recent years. "I think really important and exciting news on the consensus revenue and what is an atypical year in terms of how these things are put together. So we're really pleased to be able to announce that today," Healey said Monday afternoon. The governor referred back to the consensus revenue accord later in the same press conference Monday when asked about the future of Chapter 62F, the state tax revenue cap law that House lawmakers in particular have said they want to see changed. "I don't know what the future looks like," she said. "I know that right now we're really pleased to be out with the consensus revenue number. We'll be having some discussions about upcoming budget and priorities and the like, and a lot of work to sort through in the immediate," Healey said. Rodrigues said the revenue accord "provides a strong foundation for the Legislature and the Healey-Driscoll administration to develop a forward looking FY24 budget plan that upholds fiscal responsibility and meets the critical needs of our communities." Michlewitz said it "will allow the Legislature and the Healey-Driscoll administration to collectively construct a reasonable and appropriate budget for the upcoming fiscal year." "By basing the budget on a judicious consensus revenue figure, the Commonwealth will be able to make the necessary investments that our constituents deserve, while at the same time enhancing the state's fiscal health," Michlewitz said. The $40.41 billion revenue estimate that Gorzkowicz, Michlewitz and Rodrigues agreed to Monday, a day ahead of their deadline, is largely in keeping with the testimony they heard from economic and budget experts at a hearing last week. The Department of Revenue forecasted fiscal year 2024 state tax revenue within a range of $39.838 billion to $41.017 billion, the Mass. Taxpayers Foundation projected that fiscal year 2024 state revenues will come in at $40.06 billion, and the Center for State Policy Analysis at Tufts University estimated that fiscal year 2024 state tax revenue will land at $40.2 billion. While the official estimate of 1.6 percent growth is well below what Beacon Hill officials have projected in each of the last at least six years, it means that state revenues are expected to stay at their significantly elevated levels. The consensus revenue growth estimates were for 3.5 percent in fiscal 2022 and 2.7 percent in fiscal 2023, but over those two years state tax revenues actually surged more than 15 percent and more than 20 percent, respectively. The fiscal year 2024 revenue estimate of $40.41 billion is more than $10 billion above the estimate that Michlewitz, Rodrigues and the Baker administration originally agreed to for fiscal year 2022 ($30.12 billion) in January 2021. The state budget, which totals $52.7 billion for fiscal 2023, is supplemented by substantial federal revenues along with non-tax revenues like fees. The fiscal year 2023 bottom line represented an increase of $5.1 billion or 10.7 percent over the $47.6 billion annual budget passed for fiscal 2022. Gorzkowicz, Michlewitz and Rodrigues also confirmed Monday the amounts of money that will be transferred to various entities that have over the years secured themselves dedicated budget carve-outs. The MBTA will get $1.463 billion ($138 million more than in the current year), the Massachusetts School Building Authority will get $1.303 billion (an increase of $138 million), and $27 million will flow to the Workforce Training Fund. There will also be a $4.105 billion transfer to the state pension fund -- an increase of $361 million over the fiscal 2023 contribution -- which is expected to keep Massachusetts on track to fully fund its pension liability by 2036. Gorzkowicz also announced Monday that he was upgrading the current year's revenue estimate by $151 million or about 0.4 percent, from $39.618 billion to $39.768 billion. The three top state budget officials said that $100 million of fiscal year 2023 revenue was earmarked Monday for use to "fully pay down" pension liabilities stemming from a 2015 early retirement incentive program that otherwise would not have been paid off until fiscal year 2027. That decision was announced as one made by "the secretary and chairs." Through the first half of fiscal 2023, DOR has collected $17.789 billion, which is $56 million or 0.3 percent less than what was collected to the same period of fiscal 2022, but still $1.087 billion or 6.5 percent more had been expected during that time period. "However, a significant portion of the above-benchmark performance is due to lower than expected credits claimed by [pass-through entity] members, which we do expect to reverse in the second half of this fiscal year," Revenue Commissioner Geoffrey Snyder said last week. Gorzkowicz, Michlewitz and Rodrigues also agreed Monday to a 3.6 percent rate of potential gross state product growth for calendar year 2023. That figure is used to set up a health care cost growth benchmark under the 2012 cost containment law. [Sam Drysdale contributed to this report.] -END- |
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