BAKER TOUTS BUDGET INVESTMENTS, BUT PROGRESS CALLED INTO QUESTION [+VIDEO]
By Katie Lannan
STATE HOUSE NEWS SERVICE
STATE HOUSE, BOSTON, JAN. 24, 2018.....Gov. Charlie Baker voiced a message of fiscal discipline Wednesday as he rolled out his $40.9 billion budget for next year, highlighting proposed investments aimed at making college more affordable and fighting the opioid epidemic.
Gov. Charlie Baker laid out his fiscal 2019 budget proposal on Wednesday along with Lt. Gov. Karyn Polito (left) and Administration and Finance Secretary Michael Heffernan. [Photo: Sam Doran/SHNS]
"Our priorities here are relatively consistent with some of our historical ones," Baker said at a press conference announcing his fiscal 2019 budget, which raises spending by 2.6 percent. "We've tried to be pretty good about funding unrestricted general government aid to cities and towns, at least at the rate that tax revenue grows, to continue to invest in K-12 education and to put resources on the table for both early childhood education and higher education to help people pay for access to college programming."
Noah Berger of the Massachusetts Budget and Policy Center said Baker's spending plan "doesn't make much progress" despite some positive measures like an increase in the Earned Income Tax Credit. He said the 2.5 percent increase in K-12 education funding amounts to "essentially an inflation-level increase...which doesn't really do anything to significantly improve the quality of education in K-12 schools."
"There's some bright spots, but in some areas it looks like there's just waiting and not being able to make progress right now on those issues, and right now we're in about the best economic times that we've had in a long time," Berger said. "So this is kind of the time when you'd like to see real progress on things that improve the lives of ordinary working people, like improving the quality of education, improving our transportation system, and to be increasingly fiscally responsible by building up the reserve funds."
The budget calls for a transfer of $96 million to the stabilization fund, bringing its balance to $1.463 billion.
SHNS Video: Fiscal 2019 budget proposal: Press questions
Baker proposed increasing funding by 1 percent for the University of Massachusetts system, state universities and community colleges, and increasing early college planning grant funding by $3 million. He also called for $7.1 million to expand a community college scholarship program aimed at closing the gap between other financial aid and the cost of tuition and fees.
The budget includes $149.2 million for the Department of Public Health to fight the opioid addiction epidemic and $5 million to establish a new Substance Use Prevention, Education, and Screening Trust Fund within the Executive Office of Education.
A new $83 million allocation at the Department of Mental Health for a redesign of adult community-based mental health services won praise from Vic DiGravio of the Association for Behavioral Healthcare, who called it the department's largest funding boost in 20 years. DiGravio said Baker had worked with behavioral health providers to identify service gaps and address the needs of underfunded programs.
The Green Budget Coalition, meanwhile, said Baker's budget "gets us nowhere close to his commitment" of dedicating 1 percent of the state budget to environmental agencies, a pledge he made in 2014 while running for office.
"After years of underfunding, our agencies are too often in triage," Environmental League of Massachusetts President Elizabeth Henry said in a statement. "They struggle to execute their basic missions and implement the Legislature's requirements. We are lowering the quality of life for all Massachusetts citizens – particularly those most vulnerable."
To control costs at MassHealth, Baker is recommending new tools to help the state Medicaid program manage growth in pharmacy spending and the transition of 140,000 non-disabled adults between 100 percent and 138 percent of the federal poverty line, off MassHealth and onto comparable plans at the Massachusetts Health Connector.
Lawmakers rejected a similar proposal last year, and Baker said the new version aims to address concerns they raised.
"We believe we basically give people the same benefit plan they have now, a path forward if they happen to get over the 138 [percent] so they don't have to come off the health insurance they have," Baker said. "They're still going to have basically the same premium structure and out-of-pocket spending that they had when they were on MassHealth, and the state's actually going to generate, between the connector and MassHealth, about $120 million in additional federal revenue."
Eileen McAnneny, president of the Massachusetts Taxpayers Foundation, called the proposed decrease in MassHealth's rate of growth under the new budget "pretty remarkable."
"We think that's pretty important because it frees up some money for other spending priorities," she asid.
The final budget of the Republican governor's four-year term does not include broad-based tax hikes. It does propose extending the lodging tax to short-term housing rentals -- if they are rented out 150 or more days per year -- and allowing the Department of Revenue to enter into voluntary agreements with companies like Airbnb that could entities collect taxes on the state's behalf.
Lawmakers have said they hope to pass a bill addressing regulation and taxation of Airbnb this session. Baker said he included the measure in his budget "to send a message that it's time for us to figure this one out and get it done."
"I don't want another year to go by where we continue to have this unlevel playing field between Airbnb and traditional room operators," Baker said. "For all intents and purposes, it's a level playing field issue, and we believe it should get addressed, so let's address it."
The final version of a state budget has never before surpassed $40 billion. State spending has climbed nearly $10 billion since Gov. Deval Patrick signed the first budget over $30 billion in 2011, and almost $20 billion since the $20.6 billion budget Gov. Paul Cellucci signed in 1999.
The Massachusetts Cultural Council said Baker's plan "would maintain level state funding for arts and culture," and that the agency plans to make its case to lawmakers for a $3 million increase over the $14 million the governor allocated.
The budget includes $584.8 million for the Massachusetts Department of Transportation, and the MBTA is set to receive $1.032 billion in sales tax revenues, an increase of $25.1 million over fiscal 2018.
The next stop for Baker's budget is the House Ways and Means Committee, which will hold public hearings and release its own spending plan, likely in April.
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