MFA NEWS SCAN MARCH 2, 2015

MFA NEWS SCAN MARCH 2, 2015


- Monday, March 09, 2015



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GOVERNOR BAKER RELEASES FY ’16 PROPOSED BUDGET

On Wednesday March 4 Republican Governor Charlie Baker released the new administration’s first proposed state budget for the next fiscal year which begins July 1, 2015.  The Governor’s fiscal 2016 proposed budget totals $38.06 billion, $1.1 billion more in spending, or a 3% increase over the present fiscal budget, relying on an anticipated 4.8% growth in tax revenue next year.  The present year’s fiscal budget increased spending by 8% compared to last year’s fiscal spending.  After having to settle a $1.5 billion deficit in the present fiscal year, the Governor proposes to deal with another projected $1.8 billion deficit for the next fiscal year and balance the books by proposing some of the following major objectives to help fund the budget, redirect and cut spending while servicing constituents:

·         A tax amnesty program for those who have not paid taxes which waives penalties for individuals and businesses who owe back taxes to the state because they have not filed a return.  This is estimated to raise $100 million in revenue;

·         Increasing the Earned Income Tax Credit from 15% to 30% of the federal limit by phasing out the film tax credit over two years;

·         A 90 day regulatory pause;

·         An Executive Branch-wide hiring freeze to save tens of millions of dollars, along with an Early Retirement Incentive program which could reduce the state’s workforce by 4,500, saving an estimated $177.9 million for the next fiscal year;

·         Increasing unrestricted local aid by 3.6% to $980 million based on projected gaming and lottery revenue growth;

·         Re-determining MassHealth eligibility requirements to ensure only those who are truly eligible and in need of assistance are receiving those services, designed to save $1.6 billion.

The Governor proposes his budget without raising fees, taxes or borrowing money from the state’s Stabilization (rainy day) fund, the first time in four consecutive fiscal years that this money wouldn’t be used to help balance the budget.

 

HOUSE AND SENATE STILL AWAITING RULES COMPROMISE

The Conference Committee established to reach a compromise between House and Senate rule proposals is still at work trying to craft legislation that will be acceptable to both branches.  They began meeting on February 19 and have yet to reach agreement on the bill.  The bill must be finalized and passed before the actual 2015 – 2016 legislative session can get underway, since this legislation will govern the procedures for both the House and Senate to progress through the session.  With only 40 state Senators and 160 State Representatives, the Senate seeks to gain more control over proposals that originate in its branch by removing the disadvantage they have being outnumbered 4 to 1 by their House counterparts.  One suggestion offered was to split the 27 Joint Committees into separate committees for the House and for the Senate, thereby allowing Senate bills to be released from their respective Senate Committee to the Senate floor for a vote, rather than waiting for the Joint Committee to decide their fate.  The House does not support this recommendation, stating that it would force the hiring of additional staff for each separate committee costing MA taxpayers more money and would disassemble the present structure legislation follows through Committees that work with both House and Senate members jointly participating.

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MFA NEWS SCAN MARCH 2, 2015


- Monday, March 09, 2015



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