Gov. Patrick unveils ‘tight’ $36.34B budget

Gov. Patrick unveils ‘tight’ $36.34B budget

By John J. Monahan TELEGRAM & GAZETTE STAFF
jmonahan@telegram.com

BOSTON — Gov. Deval L. Patrick proposed a $36.34 billion fiscal 2015 budget Wednesday that would increase spending by 4.9 percent over total fiscal 2014 spending, while level funding state aid to cities and towns

The governor’s budget proposes no major tax hikes and would increase funding for local public schools by $100 million, or $25 per pupil. Another $69 million increase in higher education funding he said should be enough to keep tuition and fees from going up at state colleges and universities for the second year in a row.
The governor said cities and towns may have trouble living without an increase in aid this year, but added, “I think it is tough for everybody this year. This budget is still tight and I think the next few budgets will continue to be tight.”


The governor said in recent years the state has provided cities and towns with the ability to raise meal and hotel taxes, expanded local property taxes to telephone poles previously exempted, and approved pension and health care reforms that have provided substantial savings.

“I’m proud of this budget. It’s a good budget. It’s a sensible budget,” Mr. Patrick said as he unveiled what would be his final full year spending plan as governor. His state of the commonwealth address, postponed because of the snowstorm this week, has been rescheduled for 7 p.m. Tuesday.

The governor also proposed a $141 million increase in transportation spending, a portion of which would allow the MBTA to limit fare hikes on subways, buses and commuter rail to 5 percent as required under a transportation funding bill approved last year.

The budget calls for using $175 million from the state’s rainy day fund, leaving it with a $1.2 billion balance.

The governor is also seeking a $35.5 million increase for the Department of Children and Families, which includes $9.2 million to raise staffing and fund other reforms in that troubled agency.

The proposed increase comes as multiple investigations continue into DCF handling of the case of a missing 5-year-old Fitchburg boy, Jeremiah Oliver, that DCF officials have said disappeared at a time when the agency failed to conduct home visits despite reports of abuse.

“The staffing issues are separate from the causes of what happened in the Oliver case,” Mr. Patrick said. He has insisted that the DCF lost track of the boy, who police believe was killed, because of a lack of integrity of social workers who handled his case. Beyond that, however, the governor said, “The staffing issue is real.”

Mr. Patrick said he also wants legislative support for a $9.1 million boost in early childhood education, which he said would take 1,700 children off a statewide waiting list. A new addition to the budget plan is $52 million to help the state reinforce transportation, public health and energy infrastructure. The governor also has proposed $9.1 million in new spending on adult and youth re-entry programs for those leaving state custody and prison.

House Minority Leader Bradley H. Jones Jr., R-North Reading, criticized the budget plan as being too reliant on the rainy day fund and “dubious revenue sources.”

“Once again, the governor is treating the taxpayers of Massachusetts as an endless revenue stream, proposing to hit them again for revenue in the form of new statewide taxes,” Mr. Jones said in a news release. “This approach has not garnered support from the taxpayers in the past, and it will once again fall flat.”

The governor’s budget includes several revenue increases with proposals for a bottle bill expansion and extension of sales taxes to candy and soda, both of which have been sought by him in each of his last seven budget proposals, but rejected each time by the Legislature. He also seeks to close what he called loopholes, to raise another $40 million.

That would impose room taxes based on marked-up rates from online reservation companies and impose corporate taxes on so-called “pass through” entities owned by insurance companies and banks.

Geoffrey Beckwith, executive director of the Massachusetts Municipal Association, said level funding of aid to cities and towns would create a budget crisis for many communities that could result in layoffs and reduced services. He said they would seek more funding from the Legislature when it reviews the budget.

“The costs of providing services will increase,” he said. “Communities will have to have higher increases in the property tax or they would have to cut back on services. Level funding local aid, at a level so far below where it was in 2008, will be very painful for communities,” Mr. Beckwith said.

He said the budget proposal also would level-fund special education cost reimbursements and charter school reimbursements and underfunds local costs of school transportation for homeless students.

Michael J. Widmer, president of the business-backed Massachusetts Taxpayers Association, said most of the increased spending would go to fixed-cost items including pension contributions, debt, Medicaid, and other health care costs. He said businesses would find a lot to like in the budget.

“I think the business community would be supportive of the education increases which start at pre-K, early childhood, K-12 and higher ed,” Mr. Widmer said, adding that businesses have backed increased spending on transportation infrastructure, as well.

“On the negative side, the governor has proposed a couple of corporate tax increases on banks and insurers and I think clearly that will not be favorably received by the business community. But I don’t think the Legislature will adopt those increases,” he said of the loophole closings that could cost banks and insurers $35 million to $50 million annually.

The budget is built around a $1.1 billion expected increase in state tax revenues. When the proposed spending is compared to approved spending so far in the current fiscal year it would amount to a 4.9 percent increase. When compared to spending approved in the initial 2014 budget adopted last July, the governor is calling for an increase over 6.8 percent.

Last year, the governor proposed $1.8 billion in tax hikes that would have lowered the sales tax and increased income taxes. The Legislature rejected the proposal but approved a three-cent per gallon gas tax increase, a new tax on computer services, and a $1 per pack hike in cigarette taxes. The Legislature later repealed the controversial computer services tax.

Senate Ways and Means Chairman Stephen M. Brewer said “the good news” in the governor’s budget is reduced use of one time revenues to meet annual spending needs, including plans to reduce spending from the state’s rainy day account from $341 million this year, to $175 million in fiscal 2015. He said he also was pleased with increased funding for drug courts and drug treatment programs, but he expects some legislators will seek to increase funding for regional school transportation and special education reimbursements. “We will try to improve on that,” Mr. Brewer said.

The Massachusetts Nurses Association/National Nurses United attacked the governor’s proposed budget saying it calls for closure of Taunton State Hospital and a reduction of services for the mentally ill.

“At a time when mental health advocates across the state and across the nation are decrying a dramatic shortage of psychiatric beds and services for the care of the mentally ill and when more than 40,000 patients with mental illness are being boarded without proper care in our state’s hospital emergency departments waiting for these beds, the governor has released a budget today that once again calls for the closure of the remaining 45 beds at Taunton State Hospital,” the statement said.

If the closure goes forward, clients and families will be expected to travel 50 to 100 miles for care in Worcester or Tewksbury at facilities already overburdened, the union said.

“We are shocked at what can only be described as the governor’s abandonment of responsibility for the care of the mentally ill in Massachusetts,” said Karen Coughlin, a nurse at Taunton State and vice president of the 23,000-member union.