Gov. Baker's budget increases local aid, school money

file photoGov. Charlie Baker

Andover, other Massachusetts communities and their schools will see more money from the state under Gov. Charlie Baker’s preliminary 2021 budget unveiled last week.

Baker’s $44.6 billion spending package boosts funding for cities and towns by $31.6 million, to $1.16 billion.

Meanwhile, it increases Chapter 70 funding for local schools by $303.5 million, to nearly $5.5 billion.

"This plan is fiscally responsible, protects taxpayers and makes key investments in education, our workforce, transportation and our efforts to combat the opioid epidemic," Baker told reporters in a briefing last Wednesday.

The spending plan, which requires the Legislature’s approval, doesn’t call for raising taxes. It boosts a "rainy day" reserve fund to more than $4.3 billion.

Baker proposes increasing the per-ride assessment for Uber, Lyft and other such services from 20 cents to $1 in the next fiscal year, generating an estimated $120 million. The changes, which require legislative approval, would increase the state's share of the funds to 70%, carving out 30% of the revenue for cities and towns.

The services coordinated 81.3 million rides statewide in 2018, according to the Department of Public Utilities, generating more than $16 million worth of fees.

Baker said the increase will raise more money for local governments from ride-hailing services he says contribute to traffic congestion and roadway degradation.

"You're talking about wear and tear on our roads and bridges that needs to be supported through some other mechanism," Baker told reporters.

The Baker administration also plans to earmark about $73 million from the new fees to improve safety and reliability on MBTA trains, buses and subway cars.

Public school districts will see $355 million in new funding from the budget -- the first payment toward a $1.5 billion, seven-year overhaul of the state's public education funding formula.

The Baker administration expects to lose $95 million in the next fiscal year from decreased sales tax collections on vaping products as a result of his temporary ban and new regulations that outlawed sales of flavored vaping products.

The state will also get about $96 million less from a scheduled drop in the personal income tax rate from 5.05% to 5%, Baker administration officials said.

Among other key points of Baker’s budget proposal are

* $8.4 million in funding to transform 15 vocational high schools into "career technical institutes" that will train 20,000 workers over the next four years

* $55.1 million increase in funding for the Department of Early Education and Care, for a total of $761.9 million

* $135 million in new funding for the MBTA to improve service and reliability

* $74.8 million to expand MassHealth substance treatment services for individuals with addictions

* $40 million increase to the state Department of Transportation's budget for roadway ice and snow removal

The budget for the fiscal year that begins in July represents a 2.8% increase over this year’s spending, administration officials said.

Reaction to the preliminary spending package was mixed.

Marie-Frances Rivera, president of the nonpartisan Massachusetts Budget and Policy Center, praised Baker’s proposals to boost education and transportation funding, but suggested the budget lacks new revenue sources to pay for the initiatives.

"The key to sustaining these promises is new, progressive revenue," she said in a statement. "As revenue growth continues to slow, it's hard to tell how the governor's proposed investments will be sustained over the long-term.

The Fund Our Future campaign, a group representing parents, students and educators, praised the governor's spending proposals for public schools but criticized his plans for state-run universities and community colleges, calling the funding levels inadequate.

"The marginal campus budget increases and minuscule new college affordability initiatives he proposes fall far short of the major investments needed to remedy our state’s public higher education funding crisis," the group said in a statement.

Unlike the past several budget cycles, some economists are warning that the state could face a revenue shortfall in the next year.

The pro-business Massachusetts Taxpayer's Foundation has predicted a $880 million gap between projected revenues and expenses next fiscal year, driven mostly by a slowdown in overall tax revenue growth. The group suggested that lawmakers may have to consider "tax increases or spending cuts" to balance the state’s annual operating budget.

"Stakeholders and opinion leaders should prepare to consider such actions as budget deliberations begin," the group said in a statement.

The budget now moves to the House Ways & Means Committee, which will review Baker’s proposal and file its own spending package.




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