Briefing: State Budget
Budget season on Beacon Hill is always a complicated time, with the House, Senate and Governor hashing through various conflicting ideas about where to get and spend money. This year, though, rapidly dropping estimates for next year’s tax collections are making things even more fraught than usual.
Just how bad are things?
The latest revenue estimate for FY 2010, which the Senate is using as it readies a proposal for release this month, is approximately $18 billion. In contrast, the original projection for 2009 was $21.5 billion, meaning revenues have declined 16 percent because of the recession. Michael Widmer, president of the Massachusetts Taxpayers Foundation, recently called the situation “the worst fiscal crisis in the state’s history.”
What happens now?
Gov. Deval Patrick and the House have already released their own budget proposals, both based on revenues of $19.5 billion. Once the Senate releases its version, a joint conference committee will have to hash out the differences between the House and Senate proposals. To make things more complicated, the governor plans to refile his budget soon with changes to reflect the reduced revenue estimates.
What about the sales tax?
The House budget proposal includes a 25 percent, or 1.25 cent, increase in the state sales tax. The Massachusetts Taxpayers Foundation estimates that would translate to about $900 million in extra revenue. Gov. Patrick has said he would veto any budget that includes a hike in the tax. He favors raising taxes on gas, alcohol and candy instead.
What programs are in danger?
You name it. Various lawmakers have proposed big cuts to state services, education and local aid. Even the much-hyped Massachusetts health care reform could be on the line—Senate budget chief Steven Panagiotakos has suggested that it may be impossible to preserve the mandate for almost all state residents to have insurance.
Click here to see the official state budget documents.
Click here to see the Massachusetts Taxpayers Foundation revenue forecast.
Click here to see the Massachusetts Budget and Policy Center's analysis.
WBJ Web Partners
Most Recent
Most Recent
0 Comments