MA Legislature passes FY16 state budget

We share this press release from the Senate President’s office on the passage of the Fiscal Year 2016 Budget as enacted by H3650. You may also view Conference Committee Highlights here and Conference Summary budget graphics here.

FOR IMMEDIATE RELEASE

July 8, 2015

Legislature Passes Balanced FY16 Budget

Updates Massachusetts’ Tax Structure to Support Residents without Raising Taxes or Fees; Reforms the MBTA

BOSTON – The Massachusetts Legislature today enacted a $­­­­­­­­­38.145 billion state budget for Fiscal Year 2016 (FY16) which emphasizes economic growth, support for residents most in need, and reform of the state’s transportation system. The spending plan makes investments in local aid, education, and human services including an acute focus on behavioral health and substance abuse.

Building on a responsible yet proactive approach to bolstering the state’s economy, this year’s budget increases the Earned Income Tax Credit (EITC) while maintaining a voter-mandated tax reduction and without implementing new taxes or fees. For low-to-moderate households, EITC will increase to 23 percent on January 1, 2016. Increasing this credit is an effective way to fight stagnant wages and lift working families out of poverty.

“This year’s budget features a long-overdue increase of the Earned Income Tax Credit, and I’m thrilled we have taken this substantial step towards addressing income inequality by helping working families in Massachusetts,” said Senate President Stan Rosenberg (D-Amherst). “We’ve also ensured that taxpayers won’t be left on the hook for funding the Olympics, and MBTA riders won’t have to pick up the tab for T mismanagement. I want to commend Senator Spilka for a successful first budget which maintains our fiscal health, continues our economic growth, and lifts all families.”

“As is customary, the House budget contained a myriad of policy matters, anyone of which could have been debated and voted on during the debate in April,” said House Speaker Robert A. DeLeo (D – Winthrop). “The budget passed overwhelmingly as did the conference committee report today.”

“These budget line items are more than just numbers. They represent values, priorities and meaningful tools for people across the Commonwealth,” said Senate Committee on Ways and Means Chair Karen E. Spilka (D-Ashland). “We invest in the future, strengthening pathways to educational opportunity from early education through college and workforce training. We provide assistance for those struggling with opioid addiction and help people find stable housing solutions. The Earned Income Tax Credit increase is a big step to address rising income inequality and put more money in the pockets of hard-working families. Thank you to Senate President Rosenberg, Senator DiDomenico and Senator deMacedo for your hard work and assistance and to my House counterpart Chairman Dempsey for his partnership throughout this process. My goal when I became Chair of Senate Ways and Means this year was to create a budget to lift all families. This final budget accomplishes that goal.”

“This budget takes significant steps to begin to deliver meaningful reform to the MBTA to ensure that the system does not have the shut-downs and delays that were experienced this past winter,” said Representative Brian S. Dempsey (D-Haverhill), House Chair of the Joint Committee on Ways & Means. “I am proud that this budget maintains fiscal discipline by slowing spending growth but still makes targeted investments to deliver tax relief, combat opioid abuse, prevent homelessness and preserve services for the most vulnerable populations in our state.”

“This year’s budget makes strategic investments in some of the Commonwealth’s most critical services and programs, while still remaining financially responsible,” said Senate Committee on Ways and Means Vice Chair Sal DiDomenico (D-Everett). “The impact of this budget will be far reaching in providing support for the state’s working families by expanding vital initiatives, such as the Earned Income Tax Credit, and making crucial investments in early education. I would like to thank Chairwoman Karen Spilka, Chairman Brian Dempsey, and my fellow colleagues on the conference committee for their hard work and contributions to produce a comprehensive final budget that will continue to move our Commonwealth forward.”

“In a challenging budget year, the House and Senate have crafted a balanced and responsible spending plan that invests in local schools and communities, addresses the growing crisis in opioid addiction, and brings much needed reforms to the state’s management of public transportation,” said Representative Stephen Kulik (D- South Deerfield), House Vice-Chair of the Joint Committee on Ways & Means. “Our Commonwealth is moving forward to support working families and a stronger economic future, and this budget reflects these priorities.”

“Today we’ve enacted a Fiscal Year 2016 state budget produced in a bi-partisan and collaborative way that invests in important priories without resorting to an income tax increase, and which incorporates the products of Republican Caucus initiatives such as a strong MBTA control board, legislative control over Olympic Games funding, and the elimination of a burdensome financial surcharge for motorists not using headlight in inclement weather,” said Senate Minority Leader Bruce Tarr (R-Gloucester).

“The Fiscal Year 2016 budget reaffirms the state’s commitment to our cities and towns by providing significant increases in local aid, while also protecting the state’s hard-working taxpayers by not imposing any new taxes or drawing down from the Stabilization Fund,” said House Minority Leader Bradley H. Jones, Jr. (R-North Reading).  “The budget also takes many important steps towards reforming the MBTA by providing greater oversight and accountability of the authority’s finances and operations, which should result in improved fiscal stability and service reliability at the agency moving forward.”

The budget takes immediate steps to address systemic management problems at the MBTA by including a series of reform tools including 3-year suspension of the statute governing the procurement of private services at the MBTA and:

  • An MBTA fiscal management and control board within MassDOT that will have the power to implement measures to ensure financial, operational and managerial stability at the MBTA while operating within a unified state transportation network;
  • An internal special audit unit within MassDOT to monitor quality, efficiency and integrity of the departments operating and capital programs;
  • Streamlined accountability at the MBTA, including providing the Secretary of Transportation authority to appoint a General Manager for the MBTA.

To bolster accountability and transparency within the state’s transportation system, the law also increases the size of the MassDOT Board and makes the Secretary of Transportation chair of the Board. These updates follow two transportation reform plans accompanied by major funding increases the Legislature passed in 2009 and in 2013.

The FY16 budget targets the opioid crisis, strengthening behavioral health efforts enacted in last year’s budget and the landmark substance addiction law through several targeted investments. Many of the programs focus on co-occurring disorders and finding sustainable ways to aid in both prevention and recovery including:

  • $3 million for new clinical stabilization beds to provide for treatment after detoxification;
  • A municipal Naloxone bulk purchasing program to authorize the Department of Public Health to buy and distribute this critical intervention to first responders;
  • A task force to study the feasibility of a prescription drug disposal program;
  • $2.5 million to expand patient access to Vivitrol, a non-narcotic drug that blocks the effect of opiates or alcohol for a period of 30 days;
  • $1.5 million to expand opioid prevention grants;
  • $3.1 million for a new line item for Recovery High Schools, including $1 million to establish two new programs;
  • More than $375 million for Adult Community Mental Health Services, $87 million for Child and Adolescent Mental Health Services, and an additional $4 million for the Department of Mental Health to annualize and expand community placements to free up beds in the DMH pipeline.

This budget enhances the Commonwealth’s partnerships with cities and towns through numerous funding streams including almost $980 million to Unrestricted General Government Aid (UGGA), a $34 million increase from FY15 and $4.5 billion for Chapter 70 (education funding). The spending plan fully funds Special Education Circuit Breaker in order to help districts meet the cost of educating students with disabilities, and provides $59 million to reimburse municipalities for Regional School Transportation costs.

In addition to educational investments through local aid, this year’s budget extends Massachusetts ongoing commitment to supporting and strengthening its educational systems to foster equality and provide residents with a competitive edge, including:

  • $4 million to increase access to high-quality early education and care (EEC) for the Commonwealth’s youngest children through EEC program quality improvements, including support for workforce development and training opportunities for early educators;
  • $12 million to serve an additional 2,000+ children on the income-eligible EEC waitlist and support working families;
  • $95.6 million for the state’s Higher Education Scholarship to help eligible Massachusetts residents cover the cost of college;
  • $750,000 for the Community College Workforce Training Incentive Grant Program to expand vocationally-oriented course offerings and support the work of Community Colleges in developing tomorrow’s workforce.

This year’s budget emphasizes the importance of enhanced fiscal predictability and sustainable investments, a practice that has raised Massachusetts bond rating to AA+, the highest in the state’s history. For the first time since 2007, the budget does not withdraw any funds from the Commonwealth’s stabilization fund, leaving the balance in excess of $1 billion.

Additional economic development measures include:

  • MassCAN: $1.7 million to establish widespread, progressive computer science curriculum in public school through a public-private matching program;
  • Talent Pipeline: $1.5 million to encourage young innovators to get a head start on their futures by matching stipends for interns at innovation start-ups, and to provide mentoring opportunities for new entrepreneurs;
  • STEM Starter Academy: $4.75 million to promote STEM careers at the Commonwealth’s community colleges.
  • $2 million for the Massachusetts Manufacturing Extension Partnership to address the shortfall of skilled workers and aid small and mid-sized manufacturing companies though technical assistance and consultant support;
  • $1.5 million for a Precision Manufacturing Program, designed to increase the skill set of middle-skilled workers;
  • $600,000 for Regional Economic Development Grants;
  • $2.2 million for the Workforce Competitiveness Trust Fund to train unemployed and low-wage workers for high-demand industries like health care, construction, and education;
  • $1.2 million for a new Training Resources and Internship Networks (TRAIN) grant program, a partnership with community colleges to specifically target the long-term unemployed and provide them with training and internship opportunities and the chance to fill resume gaps.

Included in the budget is a provision that protects taxpayer dollars from being spent on the 2024 Olympics, which also includes tax incentives, for the Games if they come to Massachusetts. The provision requires Boston 2024 to formally request funding from the Legislature for any specific project and make their case during a formal hearing.

The budget now goes to the Governor.