Realism in the State Budget (17 Responses)

Earlier this month, Governor Baker released his first budget proposal.  While there is a lot to complain about in the proposal, I was heartened by the Governor’s effort to budget honestly for the costs that are hard to control, necessarily lowering expectations for spending on some broadly supported programs — programs that I have consistently fought for, like local education aid.

I wrote a few weeks ago about our pattern — Beacon Hill’s pattern — of low-balling expenditure estimates and hoping for positive revenue surprises that will balance the budget later.  In the current fiscal year, that gamble has worked out badly.  Revenues are coming in as expected, but expenditures are coming substantially higher than expected.  The resulting gap (pegged by Governor Baker at $768 million after Governor Patrick had already cut approximately $250 million) is a huge problem because we have had to shave agency spending mid-year — disrupting operational plans and crimping expected public services across the state.

Like many of my colleagues, I was chastened by this year’s bad budget outcome and feel a strong sense of duty never to let it happen again on my watch.  So, I took favorable note of Governor Baker’s budgeting an 8% increase in MassHealth spending in next year’s budget.  In one sense, that is terrible news — roughly half a billion that we won’t have to spend on other important things.  But it is a signal that he doesn’t intend to hide the problems.

Similarly, he budgeted realistically for spending for advocates for indigent defendants.  Like MassHealth, the bar advocates line item is a caseload-driven entitlement which is very hard to control.  The legislature has routinely under-budgeted this line item, filling it in with supplemental budgets later in the year.  Again, the Governor is facing reality early.

The Governor’s realism on these and other routinely-fictionalized items makes it harder for him to fund more popular programs.  So, for example, he raises statewide Chapter 70 education aid only 2.4%, despite the fact that state revenues are expected to rise by roughly 5%.

Even as it holds down popular programs, the Governor’s budget show serious signs of stress — it depends on a deferral of vendor payments, a reduction in contributions to our reserve funds and an early retirement incentive program.  Many of us in the legislature are not comfortable with any of those elements.

Through the years, I have fought consistently for increases in Chapter 70 education aid — over all and for the communities in my district.  Recently, I have fought especially hard for Watertown which has historically gotten a raw deal from the aid formula.  Additionally, I have fought for programs like the special education circuit breaker, charter school reimbursement and kindergarten grants which benefit my communities (Boston, Watertown and Belmont) — disproportionately.

I care as much as ever about those programs, but this year my top priority is to make sure that we only promise what we can deliver.   Many of us, including me, feel that we should raise more revenue for transportation and other state services, but the votes are not there for that this year.  It appears we will have to do the best we can with the revenues we have.

In most years, cities and towns can assume that the Governor’s budget proposal is a floor for local aid and that as the legislature works the budget over, local aid awards will only increase.  This year, while I think the Governor’s local aid numbers will most likely survive, it is possible that we will vote to reduce them after we further scrub the numbers. I do feel it is safe to assume we will not reduce them below the current year’s levels.

UPDATE: 3/27/15 – We received over 100 responses to a survey of website visitors about revenue and the state budget.

Here are the results of the survey, which was conducted from: 3/12-3/26/2015:

How do you feel about the revenue freeze?

revenue

We need new revenue to pay for the things that we care about. 64 56.60%
We have to live within our means, we will have to make sacrifices. 36 31.90%
Other 7 6.20%
I don’t have an opinion. 4 3.50%

If we had to cut one area of the budget, which area should it be?

cuts

Executive & Legislative 18 15.90%
Other 13 11.50%
Economic Development 12 10.60%
Prisons, Probation & Parole 12 10.60%
Pensions 12 10.60%
State Employee Health Insurance (GIC) 5 4.40%
Conservation & Recreation 4 3.50%
Law Enforcement 4 3.50%
Prosecutors 4 3.50%
Constitutional Offices 4 3.50%
Debt Service 4 3.50%
MassHealth (Medicaid) 3 2.70%
Transitional Assistance 3 2.70%
Early Education 2 1.80%
Higher Education 2 1.80%
School Building Authority 2 1.80%
Other Law & Public Safety 2 1.80%
K-12 Local Aid: Chapter 70 1 0.90%
K-12 Local Aid: Other Non-Chapter 70 Aid 1 0.90%
Public Health 1 0.90%
Elder Services 1 0.90%
Juvenile Justice 1 0.90%
Transportation 1 0.90%
Courts & Legal Aid 1 0.90%
Libraries 1 0.90%
Environment 0 0%
Mental Health 0 0%
Child Welfare 0 0%
Disability Services 0 0%
Other Human Services 0 0%
Housing 0 0%

If we could increase one area of the budget, which area should it be?

increase

Transportation 43 38.10%
K-12 Local Aid: Chapter 70 16 14.20%
Early Education 15 13.30%
Other 7 6.20%
Higher Education 5 4.40%
Child Welfare 5 4.40%
Mental Health 4 3.50%
K-12 Local Aid: Other Non-Chapter 70 Aid 3 2.70%
Housing 3 2.70%
Environment 2 1.80%
Disability Services 2 1.80%
Transitional Assistance 2 1.80%
Libraries 2 1.80%
School Building Authority 1 0.90%
Conservation & Recreation 1 0.90%
MassHealth (Medicaid) 1 0.90%
Economic Development 1 0.90%
Courts & Legal Aid 1 0.90%
Law Enforcement 1 0.90%
Debt Service 1 0.90%
Public Health 0 0%
State Employee Health Insurance (GIC) 0 0%
Elder Services 0 0%
Juvenile Justice 0 0%
Other Human Services 0 0%
Prisons, Probation & Parole 0 0%
Prosecutors 0 0%
Other Law & Public Safety 0 0%
Constitutional Offices 0 0%
Executive & Legislative 0 0%
Pensions 0 0%

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    Will Brownsberger
    State Senator
    2d Suffolk and Middlesex District