House budget mixes spending cuts, hikes

BOSTON (State House News Service) - The $32.3 billion annual budget plan released by House leaders on Wednesday presented a mixed bag for Gov. Deval Patrick who saw several of his key reform initiatives rebuffed by lawmakers in an election-year budget that significantly boosted local aid for cities and towns, but also slashed funding for human services, corrections and youth jobs.

“A major difference between this budget and the governor’s recommendation is our commitment to local communities,” House Ways and Means Chairman Rep. Brian Dempsey said.

Dempsey’s plan proposes to crack down on abuse of electronic benefit transfer cards used by public assistance recipients, close a mental health hospital in Taunton, repeal the ban on gifts to doctors from pharmaceutical companies and improve curriculum coordination between community colleges. But the House to increase local aid by $105 million more than the governor’s budget drew much of the focus at the capitol Wednesday.

The budget would increase Chapter 70 education aid to cities and towns by $164 million over its current level to $4.15 billion, and would guarantee the return of $899 million in unrestricted aid to municipalities, including $65 million that Patrick only proposed spending on local aid if a surplus existed at the end of the current fiscal year.The House budget also includes $221.5 million for the special education circuit breaker, an $8.4 million increase. The plan includes $45 million for regional school transportation, and appropriates $11.3 million to cities and towns for the first time to offset the expense of a federal mandate highlighted by Auditor Suzanne Bump requiring communities to cover the cost of transporting homeless students out of district.

“What’s striking about the budget is the increase in local aid given the fiscal realities,” said Michael Widmer, president of the Massachusetts Taxpayers Foundation. “The increase is paid for in these reductions in other accounts across state government. I’m not necessarily faulting them, but it certainly stands out.”

Widmer called it “an open question” whether departments like the Department of Correction will be able to operate with the level of funding proposed by the House, but called the shifting of resources to local aid a matter of priorities.

“Local aid is almost always a priority and history shows it’s more of a priority in the even number years. I think that’s been true for decades, so it’s no surprise,” Widmer said, alluding to November election.

Despite a nearly identical bottom line, the House rejected Patrick’s attempt to generate $260 million in revenue through higher taxes on cigarettes and candy, balancing the budget instead with a mixture of “little things,” as Dempsey put it.

Dempsey said tax reforms such as the governor’s plan to adjust the corporate excise tax factor to pick up $10 million in new revenue would put an additional burden on businesses at a time when the economy is rebounding, albeit slowly.

“By not adopting these proposals, we have reaffirmed our commitment to responsible budgeting by keeping the operating budget within our current means, and do not shift the burden of balancing the budget onto the shoulders of Massachusetts taxpayers,” Dempsey said.

The House budget proposal relies on $522 million in one-time revenues, including a $400 million draw on the state’s “rainy day” account to close what Dempsey described as a $790 million gap. The House is also counting on $175 million in budget cuts for agencies and departments, $134 million in department revenue growth through increased fee collections, and $81 million in other one-time revenues.

“Basically we looked at existing revenues in terms of trust accounts, we require additional procurement, we require renegotiation of leases, we look at some federal opportunities that with the benefit of time were not available when (the governor’s budget) was filed,” Dempsey said when asked how he balanced the budget without the revenues sought by Patrick but with a nearly identical bottom line as the governor’s.

“It’s really a combination of things and a lot of little things we were able to put together,” he continued.

The House adopted a budget order on Wednesday setting a Friday amendment deadline, giving members just two days to review and file recommended changes to the budget. With plans to begin debate a week from Monday, the House put a restriction on amendments specifying that any proposals dealing with gaming would be ruled out of order.

House Minority Leader Brad Jones applauded the increase in local aid, and said Republicans would take the next two days to analyze and file amendments. “The proposed budget contains some positive aspects, particularly since it does not contain any new taxes, as promised by Speaker DeLeo. I am pleased that multiple Republican-led initiatives, including proposals derived from the GOP Jobs Package and increased oversight for government led assistance programs, have made