Senate budget tack leaves room to negotiate key issues with House

By 
Matt Murphy, State House News Service
May. 15, 2013

The Senate's budget chief on Wednesday described differences between the House and Senate spending plans for fiscal 2014 as "incremental," but a quick review of the bill shows the branches taking different paths on education and welfare issues.

The $33.9 billion Senate budget proposal scrapped several significant policy proposals touted by House leaders intended to improve oversight and accountability over early education and the public welfare system.

And while making significant new investments in public education, elder home care and transitional housing assistance, the Senate Ways and Means Committee's budget proposal also took a less aggressive approach than the House toward increasing funding for the University of Massachusetts and other higher education institutions, potentially putting tuition and fees hikes for the next school year back on the table.

All of the issues are likely to come into play next week when the Senate opens debate on the fiscal 2014 budget plan Wednesday. Senators must file proposed amendments to the budget by Friday afternoon.

"I'm not saying that anybody ignored any of those things, but the Senate president has got a comprehensive welfare reform piece that she is drafting, working on, that will be all encompassing," Senate Ways and Means Chairman Stephen Brewer said.

The Senate Ways and Means Committee on Wednesday endorsed a $33.9 billion budget proposal for the fiscal year that begins July 1, relying on $430 million in new taxes, $800 million in revenue growth and $627 million in reserves and one-time funding to support a $1.4 billion increase in year-to-year spending.

Like the House, the Senate plans falls well short of making the investments sought by Gov. Deval Patrick in transportation and education through his $1.9 billion tax proposal. Secretary of Administration and Finance Glen Shor said the administration was reviewing the budget, with the governor's priorities in mind.

UMass officials are also likely to seek more than the $15 million increase in funding proposed by Senate Ways and Means, which they says falls short of what is necessary to freeze tuition and fees hikes next year.

The House proposed boosting funding for higher education to reach a 50-50 split with UMass over two years, and with state universities and community colleges over three years. At Senate spending levels, it would take four years to reach that goal.

Senate Majority Leader Stanley Rosenberg, an Amherst Democrat, said he supports ramping up state support for education funding, but would not offer an amendment next week out of deference to the work done by Ways and Means on the budget and the negotiations that will take place with the House after the Senate vote.

"Obviously as an advocate for public higher education, I want it much faster than that but I also know this is a process. I'm feeling hopeful that by the end of the process we can have a strong budget for public higher education on the governor's desk," Rosenberg said.

The House last month endorsed the creation of a new Bureau of Program Integrity to work on reducing fraud, improving oversight and standardizing eligibility determination processes for welfare benefits across agencies. The bill also required that electronic benefit transfer cards come with photo IDs.

Brewer said Department of Transitional Assistance officials have met with Senate leaders to outline their 100-day plan for reforming the agency after questions were raised about benefits going to recipients no longer eligible, or who no longer lived in Massachusetts.

"All of us are opposed to waste, fraud and abuse. It sullies the atmosphere for those that deservedly need to get those benefits and we're all committed to making that happen," Brewer said.

Acknowledging that amendments could be filed by Friday's 3 p.m. deadline to add some welfare reforms to the budget bill, Brewer would not say whether Senate leaders will seek to divorce the welfare reform debate from the general discussion of the budget.

"I want to see substantive changes that are meaningful and I believe the Senate president's issues that she will come out with will be comprehensive," he said.

The Senate Ways and Means budget also rejected a new $200,000 Early Education and Care Compliance Office approved by the House to improve oversight of licensed child care facilities, and called for an independent research study into the management of the pre-school waiting list rather than a review by the state auditor.

The Senate Ways and Means budget does require Level II sex offenders to be listed online, and follows House Speaker Robert DeLeo's initiative to make $100,000 in death benefits available to the family of murdered MIT police officer Sean Collier. The proposal does not include House-backed pay raises for judges after eight years without judicial salary increases, another topic that may end up being settled by an eventual conference committee.

Sen. Michael Knapik, a Westfield Republican and ranking minority member on the Ways and Means Committee, withheld his support for the budget coming out of committee on Wednesday, but said there was "a lot that's good" in the bill.

"For one thing, it rejects the governor's $1.9 billion tax package that I think would have hobbled and crippled this fledgling recovery in our state," Knapik said, calling the $500 million tax package for transportation currently being negotiated in conference committee a "much more modest" proposal.

Agreeing with some Congressional Democrats that the Affordable Care Act is a "train wreck," Knapik said Senate Republicans are trying to understand the health care reform law's looming impact on the state budget and the health care industry.

"We just don't know how it's going to play out with employment, with layoffs, with strikes. You're seeing those actions already out there in the field," Knapik said.

Brewer said the budget plan increases spending on MassHealth by $1.26 billion to about $12 billion total, an increase driven by 36 percent growth in Medicaid enrollment from the expanded eligibility under the Affordable Care Act. Ways and Means estimates that 200,000 new enrollees will fall under MassHealth starting in January at a cost of $460 million, but increased federal reimbursements will end up saving the state $156 million.

Knapik also predicted efforts to amend the budget bill next week to incorporate some of the House-backed welfare system reforms, and said he wished the transportation financing bill could be finalized before the Senate debate begins next week.

"I know we're going to hear it costs too much money, but I think the public would be well served if we put folks' pictures on the IDs and talk about some restrictions on the cashless ability. I think we need to have a further understanding of what stores can and cannot block in terms of modern technology," Knapik said.

Massachusetts Taxpayers Foundation President Michael Widmer called the 4.4 percent increase in spending a "reasonable increase given the state's economic and fiscal environment," but said he would like to see a further reduction in the reliance on one-time revenue and reserves to balance the budget.

"We're still depending too heavily, the state is, on one-time revenues given an economic recovery. In the end it would be better if we could wean ourselves more quickly from this one-time money, but I would say that's a small critique in an otherwise positive reaction," Widmer said.

Geoffrey Beckwith, executive director of the Massachusetts Municipal Association, said the Senate's approach to local aid could result in an "uneven impact" from town to town, with some benefitting from the welcomed increase in education aid, but others suffering by the decision to level fund unrestricted municipal aid. The House boosted unrestricted local aid by $21 million.

"This would be the first time in a long while, actually in memory, where the Senate budget would not reflect the same level of municipal aid coming out of the House budget so we hope there's an opportunity for progress to be made in the Senate budget debate," Beckwith said.

Though the Senate Ways and Means proposal spends $3 million more than House on youth summer jobs, advocates intend to press the Senate to add an addition $1 million to reach level funding of $9 million from fiscal 2013.

Noah Berger, president of the Massachusetts Budget and Policy Center, said new investments in early education, public health and local aid still fall below levels from 1998 through 2002 when income tax rates were cut, reducing revenue by $3 billion.

"We know that investing in our people is essential to building a strong economy, and that public health investments and oversight can save both money and lives. We see in this budget, as we saw in the House budget, that without restoring more of the revenue lost to income tax cuts it is nearly impossible to make major investments to improve the long-term economic prospects of our state," Berger said.