General local aid will rise by $39.5M in Baker budget

Boston Statehouse

BOSTON (SHNS) – Gov. Charlie Baker next week will file a budget that recommends increasing the state’s $1.13 billion general local aid account by $39.5 million, keeping with his administration’s past practice to align growth in non-school aid for the cities and towns with estimated increases in tax revenue for the coming year.

Lt. Gov. Karyn Polito teased the local aid increase on Thursday in remarks to the Massachusetts Municipal Association, which is hosting its annual meeting virtually over the next two days. The 3.5 percent increase amounts to an additional $112,535, on average, for all 351 municipalities.

The local aid increase to be included in Baker’s fiscal year 2022 budget proposal comes after the administration and the Legislature level-funded unrestricted general government aid in this year’s budget, which wasn’t signed until December. Baker is expected to file the budget bill on Wednesday.

“I can assure you today that our budget recommendation will continue the strong support of cities and towns that our administration has made a priority since entering office,” Polito said in her speech to the group, a video of which was provided to the News Service by the governor’s office.

The increase, which matches the estimated growth in tax revenues agreed to this month by Baker and legislative Democrats, would boost unrestricted aid for city and town governments from $1.128 billion in fiscal 2021 to $1.168 billion in the fiscal year that begins July 1.

Since entering office in 2015, Baker has mostly made good on his campaign promise to align growth in the unrestricted aid account with estimated annual revenue growth, though that practice was interrupted by the COVID-19 pandemic. This has led to unrestricted local aid climbing by $221 million or 23.5 percent, since 2015, Polito said.

The same principle, however, has not been applied to the largest source of local aid for cities and towns, which is the $5.28 billion Chapter 70 school aid account. Chapter 70 school aid was increased by only $107 million in this year’s budget.

Baker augmented state funding for public schools with additional federal funding sources, but the Chapter 70 account is one where the governor and lawmakers like to invest each year, and in the coming budget cycle they face even greater pressure to ramp up spending.

While the pandemic interrupted its expected first full year of implementation, a 2019 education law known as the Student Opportunity Act was intended to steer $1.5 billion to K-12 schools over seven years, and requires that in every year leading up to 2027, the state budget “shall increase foundation and increment amounts over the prior fiscal year in an equitable and consistent manner.”

The law changes the school funding formula to better account for costs associated with special education, employee health care, and teaching low-income students and English language learners.

Baker, who will give his annual “State of the Commonwealth address” next Tuesday night, often uses the MMA meeting in January to preview his budget proposal for local aid. Baker will address the group on Friday and his speech is expected to be live streamed.

While the MMA did not allow media access to Polito’s remarks on Thursday morning, the organization live tweeted the event during which Polito also announced the development of a new portal that will allow cities and towns, community non-profits and private companies to access 10 different grant programs through a single online application process.

Polito said the “Community One Stop for Growth” portal will allow the Executive Office of Housing and Economic Development, the Department of Housing and Community Development and MassDevelopment to simultaneously consider a single applications for multiple grant programs.

The portal will give applicants access to 10 popular grant programs, including MassWorks, urban agenda grants, 43D expedited permitting, community planning grants, the rural development fund, housing choice, the Massachusetts downtown initiative, brownfields redevelopment funding, site readiness grants and the program focus on underutilized properties.

Polito said interested communities are strongly encouraged to file an expression of interest between now and early April with summaries of up to five project ideas that the administration can provide feedback on.

“There is light at the end of this tunnel. Good times are ahead. And we look foward to a strong recovery coming around the corner. We will make sure every community, every city, every town in the entire commonwealth emerges from this crisis stronger than ever before, together,” Polito said.

The remainder of Polito’s remarks focused on funding made available through the recently signed economic development and transportation bond bills, and the administration’s gratitude for its partnership with MMA and individual cities and towns.

Polito said that through the administration’s Community Compact program over 1,000 best practices for local government have been adopted with more than 600 grants awarded to over 300 communities totaling $16 million.

Additional funding for these types of projects was allocated in the fiscal year 2021 budget.

“Massachusetts has faced tough times before and in the face of diversity we’ve come together with resiliency and with hope and this is no exception,” Polito said. “Together we have made significant progress battling this virus and there will be brighter days ahead of us in the weeks ahead.”

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