Local Aid Cuts Sustained In House Budget

By: Michael C. Bailey
Published: 05/10/10

Typically when the House and Senate file their respective budget proposals for the coming fiscal year, the figure released by their committees on ways and means increases as the full bodies attach their amendments and earmark requests.

That was not the case this year; the $27.8 billion number quoted last month by State Representative Charles A. Murphy (D - Burlington), chairman of the House Committee on Ways and Means, remained at $27.8 billion following five days of debate in the House.

“It’s on tight reins,” State Representative Timothy R. Madden (D – Nantucket) remarked. “The bottom line was, when they said they didn’t have any money, they meant it.”

That is not to say that all state representatives were pleased with the House budget for Fiscal Year 2011. The final version passed in a 132 to 25 vote, with nine Democrats joining all 16 Republican members in opposing the proposal.

The House spending plan represents a 3.2 percent increase over the FY10 budget, but is still $411 million less than what Governor Deval L. Patrick proposed in his budget, released earlier this year.

The budget is based on a consensus revenue projection of $19.05 billion, boosted by $1.6 billion in American Recovery and Reinvestment Act (ARRA) funds. “We’re lucky we have federal money,” State Representative Matthew C. Patrick (D – Falmouth) said. “Our revenue is down more than it was in 2002, 2003 when the dot-com bubble burst.”

The House budget also relies on a total of $1.4 billion in cuts, some of which is covered by eliminating 1,500 full-time equivalent state jobs according to Rep. Patrick, some of which is covered by cuts to local aid and Chapter 70 state education aid – the second straight year those line items have been reduced.

“It’s disappointing that we have to cut, cut, and cut, but we do,” State Representative Demetrius J. Atsalis (D – Barnstable) said, “but we all know this is a tough budget year.”

Barnstable, Bourne, Falmouth, Mashpee, and Sandwich would under the House plan lose a total of $1.67 million in Chapter 70 funding and approximately $243,000 in local aid. The five towns could recoup just over $500,000 in ARRA funding, but that money is not guaranteed.

An amendment to increase local aid by $234 million, bringing that item up to FY10 amounts, was effectively killed when the House voted 114 to 44 in favor of a Democratic leadership-sponsored proposal to indefinitely delay that increase. The proposal specifically blocks the increase until the state treasurer’s office can conduct a study of the impact on state finances.

Rep. Atsalis did not vote on that amendment, while the Cape’s Democratic members voted for it and the Republican members voted against it.

Rep. Patrick was among only nine members to vote against an amendment he sponsored calling for a major hike in the tax on dividends and interest income, from 5.3 percent – the current income tax rate – to 12 percent. The first $5,000 of such income for residents age 65 or older would have been exempt from the tax.

While he said the move would have generated $500 million in revenue, Rep. Patrick admitted, “I knew it was going to pass, but I wanted to get people to start to think about it,” citing what he called a long-standing inequity in how the wealthy are taxed as compared to the middle and lower classes.

Rep. Patrick joined State Representatives Jeffrey D. Perry (R – Sandwich) and Susan D. Williams Gifford (R – Wareham) in voting against a move to send to study a proposal to allot 50 percent of state surpluses in FY11 to local aid.

Rep. Madden voted for the amendment, which required the state treasurer’s office and the Massachusetts Department of Revenue to first study the impacts of earmarking surplus funds to local aid, and Rep. Atsalis again did not vote on the measure.

Rep. Patrick was alone among his Upper Cape colleagues in voting to send to study a proposal to repeal the state’s 6.25 percent sales tax on liquor. The Legislature voted to start charging sales tax on alcohol last year during the FY10 budget discussions.

The vote was much closer on an amendment that sent to study a proposal to require proof of US citizenship for anyone age 18 or older applying for taxpayer-funded state benefits. All five Upper Cape reps voted against the amendment, which requires the Massachusetts Executive Office of Health and Human Services to study the economic impact of limiting benefits to illegal immigrants.

Rep. Perry, who has backed several similar proposals to clamp down on undocumented immigrants collecting taxpayer-funded public benefits, called the vote “a total lack of respect for law-abiding Massachusetts taxpayers by refusing to consider a measure that would stop giving illegal immigrants benefits from public entitlement programs.”

He said that refusing to deny illegal immigrants state benefits while cutting local aid and other government programs effectively punishes law-abiding taxpayers.

Local state representatives filed several amendments to the final budget, but none of the items that had a price tag attached were actually funded. An amendment filed by Rep. Atsalis seeking $10 million for the Quinn Bill was among them.

The Quinn Bill provides police officers in participating communities with tuition reimbursements and salary bonuses connected to the attainment of a degree in law enforcement or criminal justice. The fund has been severely slashed, resulting in reduced state reimbursements to towns paying out Quinn Bill benefits.

Several towns, including Falmouth and Mashpee, have cut Quinn Bill payments to police officers in response to the reduced state reimbursements. Mashpee police officers have filed suit against the town to recover those benefits.

Several earmark requests filed by Rep. Patrick were not funded, including: $225,000 for the Barnstable Action for New Directions (BAND) program, a.k.a. the “Drug Court” program for first-time non-violent drug offenders; $35,000 for the Barnstable County Council for Children, Youth and Families; $150,000 for veterans services to be administered by the Cape Cod Community Health Center; $20,000 for the Samaritans of Cape Cod; and $2.5 million for the Residential Assistance to Families in Transition (RAFT) program.

One that would have positively affected Cape electric customers was not among them: An amendment calling for “a cost analysis report evaluating all technically-feasible supply and demand proposals capable of ensuring electricity reliability on Cape Cod” – co-sponsored by Reps. Gifford, Madden, Perry, and Sarah K. Peake (D – Provincetown) – was rejected.