THE SENATE WAYS and Means Committee on Thursday released its own nearly $46 billion budget proposal for fiscal 2021, a 5.5 percent spending increase over the current year, which is in many ways similar to the budget proposal currently being debated in the House.
The House’s initial proposal was slightly higher – $46.021 billion – and amendments are still being added on the House floor.
Like the House budget, the Senate budget includes no new broad-based taxes and relies on a significant draw from the state’s rainy day fund. There are no major cuts to services. Both the House and Senate budgets adopt proposals made by Gov. Charlie Baker to require large businesses to remit sales tax collections more quickly – though not to require daily remittances of sales taxes – and to delay implementation of a state charitable deduction.
“There’s definitely more similarities than differences in our budgets,” said Senate Ways and Means Chair Michael Rodrigues, a Westport Democrat.
The relatively close consensus reflects the fact that lawmakers hope to finish negotiating a final budget by around the end of November. Since Baker only released his budget mid-October, that represents an unusually fast time frame for a debate that usually takes several months. The state has been operating on a series of temporary budgets since July as lawmakers monitor the fiscal impacts of the coronavirus pandemic.
The main new revenue change proposed by the Senate would be to allow cashless Lottery transactions using a debit card, which senators estimate would bring in an additional $30 million. The use of credit cards would still be prohibited. Baker supports the idea, which he included in his January budget proposal.
Treasurer Deborah Goldberg, whose office controls the Lottery, has been pushing for authorization to allow cashless Lottery sales. She has also sought to allow online Lottery purchases, which lawmakers did not include in the budget.
The Senate budget includes new investments in early education and care, mental health services, and housing, as well as a new grant program aimed at helping communities disproportionately affected by the criminal justice system.
Senate President Karen Spilka said the proposal is a “balanced budget that utilizes judicious use of reserves, targeted revenue initiatives, and reasonable assumptions and makes notable, and I would say exciting, investments in the areas of life most impacted by our current crisis.”
While some progressive lawmakers and advocates have been pushing for tax changes to raise new revenue, Democratic leaders in the House and Senate have been avoiding raising taxes. Baker, a Republican, has threatened to veto new taxes.
Rodrigues said lawmakers spent years building up the $3.5 billion rainy day fund and can balance the budget using up to $1.5 billion from that fund. “Now is the time to use those reserves, and there was no need at this time in our opinion to impose new taxes in the Commonwealth,” Rodrigues said.
Among the investments in the Senate Ways and Means budget:
Amid national conversations about racial injustice and a pandemic that has disproportionately affected communities of color, the Senate wants to create a new $15 million “community empowerment and reinvestment” grant program to help communities disproportionately affected by the criminal justice system – primarily low-income and racially diverse communities. Rodrigues said the money could be used for job creation, job training, transitional employment support, small business development, and safety net programs. The grants would be distributed by a committee that includes appointees of the House, Senate, and administration as well as members of those communities.
Like the House budget, the Senate would delay implementation of the Student Opportunity Act, a new education funding formula, by a year, adding approximately $108 million to the existing Chapter 70 funding formula just to reflect the cost of inflation. The Senate proposal does not include a House initiative to create a $50 million COVID student support fund to help schools cover coronavirus-related costs.
Asked whether lawmakers will fully fund the new school aid formula over seven years, the timeline laid out in the law, Rodrigues would not commit but said lawmakers will “take it one step at a time,” and suggested future funding may be dependent on whether the state gets more federal stimulus money.
The Senate budget includes $1 million for a vaccine distribution plan, to focus on an equitable way to distribute a COVID-19 vaccine, and $10 million for municipal boards of health.
There are new investments in early education, including $40 million to pay parent fees for low-income parents with state-subsidized childcare and a $25 million reserve fund to help childcare providers cover COVID-19-related costs.
Baker, the House, and Senate all include economic development plans to help businesses recover. The Senate lays out a $46.6 million economic planning and response program, including grants, loans and technical assistance to small businesses – similar to the level proposed by the House but half of what Baker asked for.
With the expiration of a state eviction moratorium last month, one major question facing lawmakers is how to avoid a raft of evictions as tenants struggle to pay back rent. In addition to providing an additional $50 million for rental assistance – a similar amount as proposed by the House – the Senate is proposing several policy changes to make it easier for people to stay in their homes.
Senators want to increase the maximum amount of rental assistance a family is eligible for from $4,000 to $10,000. They want to require landlords to include in any notice to quit information about the tenant’s legal rights and rental assistance programs. Courts would be prevented from evicting someone while their rental assistance application was pending.
There is $20 million in new money to expand access to mental health services, including the continuation of a public awareness campaign to reduce the stigma of mental illness.
Senators are also proposing creating a fund in which to deposit all federal coronavirus relief money, with a public website that tracks how the money is being spent.
The House is expected to tack a controversial amendment onto its budget expanding abortion rights. The amendment is coming under fire from Republicans and some religious clergy, including the Catholic church. Spilka said she anticipates a senator will file a similar amendment, but she would not commit to whether the Senate would include it in their budget.
Senators have until Friday night to propose amendments, and the Senate plans to take up its version of the budget Tuesday.