The following presentation was delivered to the State House News Service by Massachusetts House Speaker Robert DeLeo and Rep. Brian Dempsey, chairman of the House Ways and Means Committee.
Last month, the House voted 152-4 for a budget that recognizes that cities and towns are the backbone of our Commonwealth. Similar to last year’s budget process, where we passed important reforms that will save cities and towns more than $100 million in municipal health care costs, we made a commitment to help our local communities this year as well.
The House budget put a premium on delivering local aid to cities and towns and fostering job creation. The fourth year into the worst financial downturn since the Great Depression, this year’s budget was not easy. We needed to close a $790million gap. A withdrawal of $400 million from the stabilization fund coupled with $175 million in cuts addressed the deficit.
Compared to the governor’s spending proposal, the House budget funds approximately 50 percent of the line items at the same level as the governor’s while less than one third are funded below, and a majority are funded near fiscal year 2012 levels.
The House recognized the additional challenges facing working families in the Commonwealth; therefore, we were committed to no new taxes or increased fees in our spending proposal. With a lagging job market and an unclear economic future, our priority was to create reforms, preserve services, eliminate waste, and reduce the burden on taxpayers.
In an environment with limited revenue growth, we chose to make a significant commitment to cities and towns. The concerns about the financial needs of communities across the Commonwealth compelled us to make a targeted investment in our municipalities. We provided cities and towns with the resources to assist in avoiding layoffs, furloughs, and reductions in services by fully funding Unrestricted General Government Aid (UGGA). Unlike the governor’s proposal, which funds UGGA through reversions, we included the additional $65 million out of committee. We made this investment because our municipalities have come to rely on this funding in order to balance their annual operating budgets.
We were proud to have our local aid spending proposal endorsed by the Commonwealth’s largest nonprofit, nonpartisan association of Massachusetts cities and towns. “The House Ways and Means Committee’s budget proposal demonstrates that local aid is a top priority for the House of Representatives. The budget recommendations would increase fiscal 2013 municipal and education aid by approximately $105 million above the budget submitted by the governor in January, a remarkable achievement that would benefit every community in Massachusetts,” says Geoff Beckwith Executive Director of the Massachusetts Municipal Association.
We prioritized education funding by guaranteeing that all municipal, vocational, and regional school districts receive an increase over Fiscal Year 2012 Chapter 70 funding for a total increase of $164 million. We also assist districts in meeting their special education obligations by funding circuit breaker at $221.5 million.
For the first time, we made an investment in the federally unfunded mandate known as McKinney-Vento. This provision of federal law requires communities to pay for the costs of transporting their homeless student population. In addition, we increased the regional school transportation funding to $45.4 million.
In the last four years, we have worked to reduce unemployment, foster job growth, create structural reforms, protect the neediest of our citizens and stabilize the Commonwealth’s finances. As a result of these priorities, our bond rating was increased from AA to AA+ by bond rating agencies, such as Standard and Poor’s. Most importantly, we have sought to protect our citizens by helping our cities and towns, the government entities on the front line of the economic downturn.