Massachusetts state budget

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Massachusetts' state legislature passed the nearly $28 billion state budget for FY2011 on June 24, 2010, one week before the fiscal year began on July 1, 2010.^[1] The House approved the budget bill 120-28 and it passed 33-7 in the Senate.^[2] Gov. Deval Patrick signed the budget the same day, ensuring that it was in place the day before the start of the new fiscal year.^[3]

Massachusetts will receive between $655 and $700 million from the federal government under H.R. 1586, a $26 billion plan to give states money for Medicaid and education that the President signed into law on August 10, 2010.^[4][5]

See also: The Massachusetts State Budget on State Budget Solutions

[edit] Fiscal Year 2011 State Budget

The state SenateWays and Means chairman Steven Panagiotakos raised high-end projections for the state's budget deficit for FY2011.^[6] Lawmakers referenced a $600 million shortfall in Medicaid accounts that would not be remedied despite the most recent stimulus funding.^[6] In addition, the revised estimates showed a $20 million gap in homeless shelter emergency assistance accounts and a $5 million shortfall for parks and beaches under the Department of Conservation and Recreation.^[6] Lawmakers declined to estimate, however, the overall deficit for FY2011.^[6] Lawmakers expect a second round of supplemental spending plans to be drafted by the midpoint of the fiscal year.^[6]

The received $655 million from Congress as part of the state stimulus passed in August 2010.^[5] The governor said he plans to introduce legislation to spend the federal money on a range of programs that were slashed in the $27.6 billion state budget for FY2011.^[5]

The FY 2011 budget increases spending by one half of a percent more than the state's FY2010 budget.^[3] The budget cuts state aid to cities and towns by four percent, cuts school spending by three percent^[3], and includes cuts that take into account the possible loss of about $700 million in federal stimulus funds.^[1] While the budget relies on nearly $200 million from the state’s rainy day fund, it introduces no new taxes or fees are included in the budget.^[1] Lawmakers had previously said that they would not tap the rainy day fund, having done so in the prior years, but changed their minds in light of the uncertainty over federal funds.^[7]

Officials anticipated that the cuts included in the spending plan would result in 1,000 state workers being laid off.^[3]

The budget bars illegal immigrants from receiving state services, including federal funds.^[7] That portion of the budget codifies existing state policies.^[8]

Gov. Patrick vetoed $457 million in spending, much of it anticipated federal dollars that Congress has yet to approve and he reduced by $20 million for programs for developmentally disabled children and other cuts to health services.^[3] The day after the budget became law, the legislature passed a $300 million debt-restructuring plan that makes the budget balanced.^[9]

Since FY2009, funding for public higher education has been cut from $1.09 billion to $954.1 million. State and community colleges have been cut 14.4% each, while the University of Massachusetts system has been cut 15.1 percent.^[10] Also since FY 2009, funding has been reduced by an estimated $113 million, close to 18%.^[11]

[edit] Budget Background

Massachusetts' fiscal year runs from July 1 to June 30 of the following year. According to the Massachusetts Constitution, the Governor must propose a budget for the next fiscal year within 3 weeks after the Legislature convenes, which translates into the 4th Wednesday of January. This year, that date fell on Wednesday, January 28, 2009.^[12]

Step 1 : Governor’s Budget

• The budget begins as a bill that the Governor submits in January (or February if at the start of a new term) to the House of Representatives.

Step 2 : House Ways & Means Budget

• The House Ways and Means Committee reviews this budget and then develops its own recommendation.

Step 3 : House Budget

• Once debated, amended and voted on by the full House, it becomes the House budget bill.

Step 4 : Senate Ways & Means Budget

• At this point, the House passes its bill to the Senate. The Senate Ways & Means Committee reviews that bill and develops its own recommendation.

Step 5 : Senate Budget

• Once debated, amended and voted on, it becomes the Senate's budget bill.

Step 6 : Conference Committee Budget

• House and Senate leadership then assign members to a joint "conference committee" to negotiate the differences between the House and Senate bills. Once that work is completed, the conference committee returns its bill to the House for a vote. If the House makes any changes to the bill, it must return the bill to the conference committee to be renegotiated. Once approved by the House, the budget passes to the Senate, which then votes its approval.

Step 7 : Vetoes

• From there, the Senate passes the bill to the Governor who has ten days to review and approve it, or make vetoes or reductions. The Governor may approve or veto the entire budget, or may veto or reduce certain line items or sections, but may not add anything.

Step 8 : Overrides

• The House and Senate may vote to override the Governor's vetoes. Overrides require a two-thirds majority in each chamber.

Step 9 : Final Budget

• The final budget is also known as the General Appropriations Act. The final budget consists of the Conference Committee version, minus any vetoes, plus any overrides.^[13]

[edit] Budget figures

Massachusetts FY2011 state budget summary and comparison^[14]

Category	FY08 Spend	FY09 Spend	FY10 Original	FY10 Estimate	FY 11 w/ Federal $	FY 11 w/o Federal $	Difference FY10 Est. & FY11 w/o Federal $
Health Care	9,646.9	10,300.7	10,333.1	10,838.8	11,211.8	11,013.4	174.6
Local Government Support	5,748.0	5,821.3	5,504.3	5,488.0	5,351.0	5,322.2	-165.8
Other Education	1,633.5	1,647.4	1,604.9	1,587.1	1,495.1	1,455.6	-131.5
Human Services	4,936.1	4,953.6	4,812.1	4,794.6	4,818.8	4,720.7	-73.9
Public Safety	2,460.3	2,425.3	2,134.3	2,340.0	2,249.0	2,225.1	-114.9
Transportation	289.3	312.8	220.1	206.3	225.7	225.7	19.4
Economic Development	518.7	374.0	325.5	302.8	309.8	298.7	-4.1
Capital Support	2,039.2	2,055.9	2,198.1	2,173.9	2,065.0	2,064.3	-109.5
Other/General Government	631.4	689.0	488.6	477.5	494.8	477.1	-0.3
Sub-Total	30,537.3	31,247.7	30,446.6	31,034.1	31,357.4	30,939.2	-94.9
Budget Transfers	1,407.0	1,397.6	1,550.2	1,518.1	1,571.4	1,571.4	53.3
TOTAL	31,944.3	32,645.3	31,996.8	32,552.2	32,928.8	32,510.6	-41.6

The following table presents Massachusetts's spending history. The figures used are in millions of dollars:^[15]

Fiscal Year	Nominal Government Spending	Real Government Spending	Real Change from Prior Year
2008	31,694.416[15]	34,213.722[15]	0.1%
2007	29,913.923[15]	34,194.834[15]	7.5%
2006	26,592.198[15]	31,811.763[15]	0.6%
2005	24,846.982[15]	31,610.590[15]	0.8%
2004	23,331.771[15]	31,350.891[15]	-2.2%
2003	23,011.620[15]	32,046.556[15]	-4.7%
2002	23,289.777[15]	33,617.370[15]	0.7%
2001	22,655.934[15]	33,396.954[15]	n/a

Historic General Appropriation Act (GAA) Budget Levels:^[16]

FY 2010	$27.0 billion
FY 2009	$28.2 billion
FY 2008	$26.8 billion
FY 2007	$25.7 billion

[edit] 2009-2010 budget crisis

In January 2010, Gov. Deval Patrick revealed a $28.2 billion budget for FY 2011, a 3 percent increase over FY 2010. The budget includes budget cuts worth $800 million and relies on $600 million in federal aid. "This budget is about people, not just numbers or line items. And for that fundamental reason, proposes to invest in jobs, education, health care and services for the most needy," said Patrick. Proposed budget cuts include: $3.2 million cut for state parks, reductions of film and life science tax credits worth $80 million and a repeal of sales-tax exemption on soda, candy and smokeless tobacco worth $67 million.^[17][18]

[edit] 2008-2009 budget crisis

See: Massachusetts state budget (2008-2009)

[edit] Accounting Principles

Main article: Massachusetts government accounting principles

Mr. Joseph DeNucci has been the Auditor of the Commonwealth of Massachusetts since 1987. The Office of the Auditor of the Commonwealth publishes their audit reports online and is responsible for:^[19]

• Determining whether the Commonwealth's resources are properly safeguarded;
• Determining whether such resources are properly and prudently used;
• Evaluating internal controls to help insure integrity in financial management systems;
• Determines whether computer systems and technology environment meet control objectives regarding security, integrity, and availability;
• Evaluating management's economy and efficiency in it use of resources;
• Determining and evaluating a program's results, benefits, or accomplishments; and
• Ensuring that all audit results are fully disclosed to the public and the auditees.

The Institute for Truth in Accounting (IFTA) rates Massachusetts “Timely” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider Massachusetts' CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.^[20] Massachusetts' CAFRs are published online by the Comptroller of the Commonwealth of Massachusetts Martin J. Benison has been Comptroller of the Commonwealth of Massachusetts since 1999.^[21]

[edit] Budget transparency

Massachusetts currently has no statewide, official spending database online. However, the Massachusetts Budget and Policy Center, which "provides independent research and analysis of state budget and tax policies,"^[22] tracks actual spending in real and nominal terms using a "Budget Browser," available here.

Legislators in favor of transparency, headed by Massachusetts State Senator Cynthia Creem, have introduced a budget amendment that would require the Secretary of Administration and Finance to create a spending transparency website.^[23]

See also: Evaluation of Massachusetts state website

[edit] Economic Stimulus Transparency

• Massachusetts will receive approximately $704 million from the federal government under H.R. 1586, a $26 billion plan to give states money for Medicaid and education that the President signed into law on August 10, 2010.^[24]

• Massachusetts was to receive an estimated $3,579,139,180 in the first round of federal stimulus funds.^[25]

• The economic recovery website to show how legislators and government officials in Massachusetts are spending Federal funds is available here.

Two Massachusetts projects were noted in Senator Coburn and Senator McCain's "Summertime Blues, 100 stimulus projects that give taxpayers the blues" report. The Federal Emergency Management Agency provided the Hyannis Harbor Tours boat company with a $43,214 terrorism prevention grant.^[26]

[edit] Error in ARRP

On November 16 and 17, 2009, many errors were found in the $747 billion plan that showed the plan set aside money for districts that do not exist. According to Recovery.gov, the plan shows its funds will go to 884 Congressional Districts, though there are only 435.^[27][28]

The state of Massachusetts has 10 congressional districts, but the ARRP website shows there are six more to receive funding. Non-existing districts are alloted to receive $29,882,326 to create/sustain at total of 189.9 jobs.^[29]

[edit] Public employee salary information

Main article: Maine state government salary

The Boston Herald has this list of state payroll information: Massachusetts 2009 State Employee Payroll

[edit] See Also

• Massachusetts taxpayer-funded lobbying

[edit] External links

[edit] Additional reading

• Gov. Deval L. Patrick,"2010 State of the Commonwealth Address," January 21, 2010
• Governor's budget, Fiscal Year 2009
• Detailed Budget, FY 2009

[edit] References

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