Mass. House May Cut Local Aid

The Massachusetts House of Representatives unveiled their version of the state budget on Wednesday, a plan that closes the $3.6 billion budget shortfall with federal stimulus funds, cuts in services and programs, and a reduction in local aid to cities and towns.

The House Ways and Means committee submitted a $27.44 billion budget for fiscal year 2010—$532 million less than what was proposed by Governor Deval L. Patrick ’78 three months ago. That same month, Patrick made a midyear budget cut of $128 million, leading to a local aid decrease of approximately $2.6 million for the City of Cambridge for fiscal year 2009.

The House’s budget relies on $1.46 billion in federal stimulus aid, cancels a planned $97 million transfer to a state rainy day fund, and makes over $1.8 billion in cuts to state programs and services. Unlike the governor’s plan, which proposed $587 million in new taxes, the House plan does not include any new taxes nor does it draw from the remaining $1.3 billion in the rainy day fund.

“In crafting this budget, the Committee was faced with an array of distasteful choices as a result of the global fiscal crisis,” wrote committee chairman Charles A. Murphy in a letter to the Massachusetts House of Representatives. “It is impossible to make budget cuts of this magnitude without adversely affecting wide portions of our society.”

After the state House debates and revises the budget, the state Senate will draft a budget of their own. A final plan for state funds will be a compromise between these two and will be submitted to Patrick by July 1.

The budget slashes aid to local communities by $424 million, a 25 percent reduction in the funding the state will distribute this year even after Patrick’s midyear cuts.

According to State Representative Alice K. Wolf, Cambridge will see an approximate drop of $7 million in local aid as a result. Across Massachusetts, cities and towns are struggling to cope with the aid reduction, considering measures such as slashing police and fire services, laying off workers, and imposing new taxes, Wolf said.

“We knew it was going to be an awful budget,” said Wolf. “But it’s worse than we thought.”

Cambridge City Councillor Sam Seidel said that Cambridge has coped well with local aid cuts thus far and has avoided mass layoffs and drastic reductions in services.

But with yesterday’s House budget announcement, Seidel said that Cambridge now has to make tough decisions about how to absorb the cuts. According to Seidel, this is the largest cut in local aid in the state’s history.

“These cuts are real, and there’s no other source to make up this money,” Seidel said. “This cut is going to be reflected somewhere in the city’s money.”

Cambridge officials are currently working on the city budget for fiscal year 2010, which will soon be presented to the City Council. However, Seidel said that the budget will probably need to be revised in order to factor in these new local aid cuts.

City Spokesperson Ini Tomeu said that there have not yet been meetings about Wednesday’s House budget, but that budget hearings will take place soon.

Beside cutting local aid, the state budget will impact a wide range of state programs and services. The budget looks to eliminate the Quinn Bill, which increases the salary of police officers who earn college degrees, and will cut $5.9 million in aid for public libraries, $2.8 million for suicide prevention programs, and $16 million for community-based services for the elderly and disabled.

In forming the budget, the House Committee on Ways and Means relied on a projected $19.53 billion in tax collections, a figure that Wolf said may need to be revised as per capita income drops.

Wolf said that her constituents in Cambridge have expressed a preference for tax increases rather than “Draconian cuts in services.”

According to Wolf, state lawmakers have been discussing a number of options to raise revenue and minimize the budget cuts, including raising taxes for hotels, restaurants, and telecommunications companies, as well as broad-based income and sales tax increases.

—Staff writer Liyun Jin can be reached at ljin@fas.harvard.edu.