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Senate Passes Fiscal Year 2016 Budget

May 26, 2015

EITC1 FINALLast week, the Senate unanimously passed a $38.09 billion budget for Fiscal Year 2016. The budget makes critical investments in key areas of local aid, education, economic development and services for vulnerable and under-served populations.

“This final budget builds on the themes and investments of the Senate Ways and Means recommendations to lift all families and invest in our future,” said Senate Committee on Ways and Means Chair Karen Spilka (D-Ashland). “I am proud of the collaborative process and spirited, thoughtful debate this week to create a budget that reflects shared Senate values and advances individuals, families and communities across the Commonwealth.”

“Congratulations to Senator Spilka and the members of the Committee on Ways and Means on an engaging, productive and robust budget debate. This week illustrated the shared values, cooperation and shared leadership in the Senate. The expansion of the Earned Income Tax Credit and our investments in workforce training, education and economic development in this budget will lift all working families across Massachusetts,” said Senate President Stan Rosenberg (D-Amherst). “In addition, this budget changes the structure of the MassDOT board and creates an MBTA Fiscal Management and Control Board with real accountability to fix the management issues in our public transit system. I could not be happier with the work of the members of the Senate this week.”

“This year’s budget makes strategic investments in some of our most critical services and programs while still remaining fiscally-prudent,” said Senate Committee on Ways and Means Vice Chair Sal DiDomenico (D-Everett). “It also helps working families by expanding initiatives, like the earned income tax credit, and supports some of our most vulnerable populations by increasing funding for programs such as adult basic education, pediatric palliative care and food assistance.  It has been a pleasure to work alongside Chairwoman Spilka, Senate President Rosenberg and other members of the Senate in crafting a bill that will continue to move the Commonwealth forward.”

“The Senate budget reflects priorities of the members of the Senate, their districts and the people of the Commonwealth,” said Senate Committee on Ways and Means Assistant Vice Chair Pat Jehlen (D-Somerville). “Most notably, it significantly increases the Commonwealth’s investment in elder care and services. It expands eligibility for home care and prevents a waitlist. It increases funding for Mass Councils on Aging. And it protects nursing home residents from potentially losing their beds when they are hospitalized or are visiting family.”

The budget reflects the Senate’s continued commitment to local aid for cities and towns.

  • $4.51B for Chapter 70 education aid, allowing for a minimum increase of $25 per pupil and bringing school districts closer to their target spending through 50% effort reduction.
  • $979.8M for Unrestricted General Government Aid (UGGA) for community investments in education, public safety, roads and bridges and health care.
  • $271.6M to fully fund the Special Education Circuit Breaker for the 4th straight year.
  • $59M for the Regional School Transportation program, which reimburses regional school districts for the costs of transporting students to and from regional schools.
  • $14M for the Massachusetts Cultural Council to support arts, culture and the creative economy in communities across the state and $6M for Regional Tourist Councils.

In addition to Chapter 70 education aid and the Special Education Circuit Breaker, the budget invests in education at all levels: from early education to college to workforce development.

  • $252M for Income Eligible Childcare and $12M to reduce the waitlist for childcare services.
  • $10.1M for the Head Start program and $5.3M for the Early Educator Salary Reserve.
  • $1.5M for the STEM Pipeline Fund.
  • $1.5M for the Massachusetts Computing Attainment Network (MassCAN) initiative.
  • $30.9M for the Adult Basic Education program to reduce the waitlist for adult education and connect adults with skills they need to join the workforce.
  • $12.5M increase for State Universities and Community Colleges and $18.8M increase for the University of Massachusetts over FY 2015.

The budget makes investments in economic development and workforce training to help low-income families become self-sufficient, get the unemployed and long-term unemployed back to work and support sectors of the economy that drive economic growth.

The final Senate budget increases the state’s Earned Income Tax Credit to help working families and increases the state’s personal tax exemption for all taxpayers. The tax cuts are revenue neutral and will be paid for by freezing at 5.15% the state’s income tax, which was scheduled to decrease to 5.10% next year if certain triggers are met. By freezing that tax cut and channeling the money back to those who need it most, the Senate hopes to reverse the troubling trend of wage stagnation which has plagued working families for decades. The current Massachusetts Earned Income Tax Credit is 15% of the Federal program, equal to an average of $315 per recipient. Under the Senate plan, the state match will increase to 22.5% of the Federal program over three years, a 50% increase in the state EITC or an average of $470 per recipient.

Other investments and initiatives to promote self-sufficiency and create opportunities for working families and the unemployed include:

  • $17M for the Massachusetts Emergency Food Assistance Program.
  • $12.1M for the Employment Services Program and $5M for the Pathways to Self-Sufficiency Program.
  • $11.5M for the Youth-At-Risk Summer Jobs program.
  • $2M for the Workforce Competitiveness Trust Fund to train unemployed and low-wage workers for high demand industries.
  • $1.2M for a new Training Resources and Internship Networks (TRAIN) grant program to specifically target the long-term unemployed through partnerships with community colleges to provide training and internship opportunities.
  • A new $1M Family Well-Being Plan pilot program to promote educational and employment opportunities for those exempt from Department of Transitional Assistance (DTA) work requirements.

The budget supports the sectors of the Massachusetts economy that drive economic growth, targeting investments in the innovation and knowledge-based economy:

  • $15M for the Massachusetts Life Sciences Center out of the consolidated net surplus.
  • $3M for the Innovation Institute at the Massachusetts Technology Collaborative.
  • $2M for the Massachusetts Manufacturing Extension Partnership and $1.4M for a Precision Manufacturing Program.
  • $5M for the Big Data Innovation and Workforce Fund.
  • $750K for Regional Economic Development Grants.

In addition, the budget invests in the full spectrum of homelessness prevention and housing support services to strengthen links to permanent housing solutions, including:

  • $154.9M for Emergency Assistance Family Shelters.
  • $85.4M for the Massachusetts Rental Voucher Program to fund between 600 and 750 new rental assistance vouchers and $4.8M for the Alternative Housing Voucher Program, the rental assistance program for people with disabilities.
  • $44.7M for Homeless Individuals Assistance.
  • $13M for Residential Assistance for Families in Transition (RAFT).
  • $2M for housing and supportive services for unaccompanied homeless youth.
  • A new $7M reserve to fund flexible short-term assistance to divert homeless families, or families at risk of becoming homeless, from shelters to stable housing.

This budget continues the Senate’s mission to break the cycle of addiction through investments in substance abuse prevention, recovery and treatment, including:

  • $10M for the Substance Abuse Trust Fund to fund a range of treatment services, including detoxification, clinical stabilization, transitional support, residential services and outpatient treatment.
  • $5M for more than 150 new clinical stabilization beds.
  • $1.5M for grants to school districts to hire mental health and substance abuse counselors.
  • $3.1M for Recovery High Schools, including $1M to establish two new schools.
  • A new Municipal Naloxone Bulk Purchase Program which allows municipalities to purchase the lifesaving overdose reversal drug commonly referred to as Narcan at discounted rates.

The budget invests in tools and resources to help individuals with disabilities, at-risk youth, seniors and veterans and supports a range of public health and mental health programs.

Priorities in the budget reflect the Senate’s commitment to public safety, while encouraging criminal justice innovation in order to reduce recidivism and improve the fairness and effectiveness of the Massachusetts justice system. The budget includes $2.5M for the Massachusetts Offender Recidivism Reduction Program and $8M for the Shannon Grant Program to combat gangs and youth violence in communities across the state. The budget also improves access to justice by investing $17.1M in civil legal aid for poor and disadvantaged Massachusetts residents and $1.4M in Prisoners’ Legal Services.

A Conference Committee will now work out the differences between the Senate budget and the version passed by the House of Representatives in April. Fiscal Year 2016 begins on July 1, 2015.

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