The Governor’s budget (“House 1”) recommends significant spending reductions across state government. His proposal includes deep local aid cuts that will particularly hurt lower-income communities, cuts to public higher education of over fifteen percent from this year’s original budget, and decreases in various human service and health care accounts. These cuts and others mean that this budget will lead to real reductions in our state’s ability to protect public safety, provide educational opportunities, and assist vulnerable populations.
The Governor proposes a combination of strategies to address a budget gap that he estimates at $3.5 billion. These include the following:
- $1.63 billion in spending cuts and savings, the most significant of which are described in the following pages of this MassBudget Brief;
- $587 million in new revenue from increasing the hotels and meals tax, eliminating the sales tax exemption for candy, sweetened beverages, and alcohol, and increasing various fees;
- $586 million from the stabilization fund (a withdrawal of $489 million and a foregone deposit of $97 million) and;
- $711 million in Federal Recovery Aid.
While the Governor’s budget calls for deep cuts, on top of the major cuts already enacted in October of 2008, the picture could have been even more disturbing. It appears that the federal government will be providing several billion dollars in fiscal relief to Massachusetts, and the Governor proposes using over $1.24 billion of that money in FY2009 and FY2010 to protect against deeper cuts. This federal help will serve to stimulate economic activity in Massachusetts, reduce layoffs, and protect services that people across Massachusetts rely on.
This MassBudget Brief provides an overview of the Governor’s proposal in each major area of the budget. MassBudget will publish a more comprehensive Budget Monitor next week.
This preliminary analysis of the Governor’s FY 2010 budget recommendations categorizes the budget in a different way from previous MassBudget documents. For example, early education and care is now included under education, and the health care category now includes mental health and funding for state employee health benefits. For a complete listing, please see the box at the end of this document.
Staff
