TARR: TEAMWORK NEEDED TO TAME BUDGET COST DRIVERS
By Michael P. Norton and Katie Lannan
STATE HOUSE NEWS SERVICE
STATE HOUSE, BOSTON, MAY 22, 2018...Sen. Bruce Tarr used a top-of-mind sports metaphor Tuesday to make his point that lawmakers need to take a team approach to tame some of the biggest cost drivers in the state budget.
During the first hour of debate on the Senates $41.4 billion fiscal 2019 budget, Tarr asked Senate Ways and Means Chairwoman Karen Spilka of Ashland whether the "unstoppable" Lebron James would be able to thwart the Boston Celtics, who are trying to defeat the Cleveland Cavaliers and reach the NBA Finals.
"I believe that a team working together can overcome any one single person," Spilka responded. "We all need to rally and support them," she added.
It was just the answer Tarr hoped for. A Republican from Gloucester, Tarr then asserted that the state's ability to build its rainy day reserves, which can preserve state services in a recession and free up money to invest in popular areas like education, local aid and mental health services, is largely riding on the level of commitment and cooperation (think help defense) lawmakers make to taming growth in health care, pension and debt service spending.
From perenially underfunded accounts to spending nearly 40 percent of the budget on one program, MassHealth, Tarr said state government needs to face up to the task of controlling spending. He pointed to the budget's big-ticket items as worth more consideration: a "staggering" $2.47 billion for annual debt service payments and $2.61 billion for pension payments, an increase over fiscal 2018 that Spilka estimated at 8.9 percent.
Tarr also highlighted another wrinkle of life on Beacon Hill. While Democrats annually proclaim the annual budget as balanced, they routinely approve a series of midyear spending bills. Spilka said Gov. Charlie Baker has filed five supplemental budgets this fiscal year alone. He signed a $147 million spending bill hours after it reached his desk Monday, and Spilka said another supplemental spending bill will probably come up before June 30.
Sen. Michael Brady, a Brockton Democrat who co-chairs the Revenue Committee that reviews tax legislation, turned to Twitter to seize on the Celtics theme, but Brady appeared focused on coming up with new revenue, rather than cost savings.
"We need to work as a team to create revenue for the #Commonwealth to better provide for our schools and communities," Brady tweeted, accentuating his statement with a gif of a towel-waving Larry Bird.
While the House structured its fiscal 2019 budget in a way that would enable the Senate to propose a major tax increase, the Senate budget, like the House, relies on only targeted new taxes associated with short-term rentals, legal marijuana and corporate repatriation authorized under a federal tax law.
The Senate also defended one of the state's revenue sources, voting 24-14 to defeat an amendment authorizing a two-day suspension of the state sales tax this summer.
Spilka did outline several areas where the Senate is hoping to wring savings out of the state budget, and said one-time revenues in the state budget total about $100 million, a major reduction from past years. "That is something we have worked hard for," she said.
While the wait continues for a House health care savings bill, Spilka said she hoped to eventually get into a conference committee with the House to hash out a bill this year. "We are hoping that we can finalize one in conference committee to continue to have cost savings for the Commonwealth," she said.
In that same policy realm, Spilka said the Senate budget eyes up to $80 million in savings by allowing the health and human services secretary to negotiate directly with pharmaceutical manafacturers for better prices and supplmental rebates and to demand increased transparency. Drug prices, she said, are perhaps the fastest growing element in the health care system.
Spilka highlighted an outside section in the Senate budget that would create commission to review tax expenditures, also known as tax breaks or loopholes, on a rolling basis and determine if existing policies should be repealed, amended or allowed to sunset.
The Senate included the same measure in its fiscal 2018 budget, but it did not survive talks with the House.
Spilka said lawmakers do not even have the information they need to judge which tax expenditures are benefiting the state and its taxpayers and which they should reconsider.
As another effort to generate savings, Spilka said the budget would create a commission to study the costs of prisons and jails and recommend appropriate funding levels for the Department of Correction and sheriffs' departments. A report released Monday by MassINC found that the number of inmates in state and county correctional facilities dropped 21 percent over the past eight years while correctional budgets increased by nearly 25 percent.
Pointing to recent criminal justice reform legislation aimed at reducing recidivism, Spilka said it is important to look for ways to save money "reasonably" and "efficiently" as policymakers also work to bring down incarceration rates.
The Senate budget also proposes pay increases for public defenders and district attorneys. Spilka said that added money will lead to long-term savings by reducing turnover, creating more stability, and driving down costs for rehiring and training.
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