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Conference Preview:
Differences Between the Senate and House Budgets for FY 2016

May 27, 2015
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[Updated for accuracy, June 4, 2015]


The House and Senate have now completed crafting and debating their state budget proposals for the year that begins July 1. The state budget is the way we as a Commonwealth make decisions about funding for a wide range of things including our local schools, roads and bridges, subways and buses, environmental protection, maintenance of beaches and parks, and supports for working families, like health care, child care and job training programs.

This year’s budget proposals have a lot in common. They propose neither major budget cuts nor major increases. Both branches approved the Governor’s proposal to enact an early retirement plan that will reduce the state workforce by about 4,000 people. It is unclear how much this will reduce the capacity of the state to provide timely and efficient services that people rely on. Both budgets modestly increase funding for local aid and education and direct new funding towards reducing and treating substance abuse.

Making meaningful progress towards fixing our transportation systems, making higher education more affordable, or addressing other major issues facing working families would likely require reforming our state tax system in a way that was not considered by either the House or Senate. Currently our state’s highest income residents pay substantially less of their income in state and local taxes than other taxpayers. This costs the state approximately $2 billion a year and makes it difficult for the state to address many of the big challenges facing families across the state.

There are modest differences between the House and Senate budgets. The House includes modestly more funding than the Senate for domestic violence support services, for services for people with autism, and for kindergarten expansion grants. The Senate includes modestly more for early education and care, higher education and job training. The Senate also funds additional auditors at the Department of Revenue, which will generate resources to fund these investments by making it more difficult for large corporations and other sophisticated taxpayers to use tax evasion techniques to avoid paying taxes they owe.

During floor debate the Senate adopted an amendment that would increase the state Earned Income Tax Credit (EITC) and expand the personal exemption in lieu of a scheduled decrease in the income tax rate. This would have the effect of directing tax reductions more towards lower and middle income families and less towards our highest income residents. The House did not include this proposal.

The Senate supports changing the structure of the board of directors for the Massachusetts Department of Transportation providing a larger role for the Secretary of Transportation. They also authorize a Fiscal Management Control Board for the MBTA. The House proposes suspending at the MBTA the state law that regulates privatization (for more detail, click HERE). The Senate leaves that law in place.

This Monitor describes major differences between the House and Senate final budgets that will need to be reconciled by the conference committee now meeting. The Legislature’s final budget will then be sent to the Governor, who has line item veto authority to eliminate or reduce funding or specific policy provisions. Those vetoes could be overridden by a two-thirds vote of both branches of the Legislature.


Early Education & Care

Due to differences between the House and Senate, the conference committee will have to reconcile over a dozen early education line items. Overall the Senate appropriation of $568.3 million is $8.7 million more than the House with the Senate proposing more funding for eleven programs and less funding for two.

The Senate approved a few amendments during floor debate including one that establishes the Commonwealth Preschool Partnership Initiative. This initiative would provide a total of $500,000 in grants to cities, towns, school districts or collaboratives that are already providing pre-k with funds to help them increase access for children ages 2.9 to 3.1 years old. The House proposal did not include this initiative.

Another major difference between the two proposals is the amount of funding to reduce the Income Eligible Child Care Wait List. The House proposed $5 million while the Senate proposed $12 million. Although all of these proposals provide some funding to increase the number of subsidies available for kids in Massachusetts, they come short of providing a subsidy to all of the families who need support. For more information on the resources needed to provide early education to three and four-year-olds in Massachusetts, see Building a Foundation for Success.

The Senate proposed combining TANF Child Care and Supportive Child Care into one line item - Supportive and TANF Child Care. The House proposal left them separate. In order to compare the two proposals, and based on information from Senate Ways & Means, we allocate $100.5 million to Supportive Child Care and $121.6 million to TANF Child Care. After that adjustment the Senate provides $250,000 more in each, a difference of less than 1 percent. For more information on these two line items, see the MassBudget Children’s Budget.

The table below illustrates all differences which will have to be reconciled in Conference Committee.

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K-12 Education

For the most part, the Senate and House budgets for K-12 education are very similar. However, several line items do vary across the final House and Senate budgets and these differences will be reconciled in conference. For full details, see the table below.

Of note, the Senate budget proposes funding Chapter 70 education aid at $4.51 billion, a 3 percent increase over last year. This Senate proposal is $3.0 million above the House budget. This added funding comes from providing additional support to districts that are contributing more to their local schools than their target identified in Chapter 70 reforms begun in 2007. This “effort reduction” is increased to 50 percent in the Senate budget compared to 45 percent in the House.

For more discussion of the House and Senate education proposals for FY 2016, see MassBudget’s Budget Monitors for the House Ways and Means, House Final, and Senate Ways and Means budgets.

Other notable differences between the Senate and House proposals include:

  • Kindergarten Expansion Grants are level-funded at $18.6 million in the House proposal, compared to only $1.0 million in the Senate.
  • The Special Education Circuit Breaker is funded at $271.7 million in the Senate proposal, which is $10.1 million above the House budget. The Senate’s proposal is likely sufficient to fully fund the Circuit Breaker formula, which reimburses school districts for the costs of educating severely disabled students.
  • Charter School Reimbursements are funded at $84.5 million in the Senate budget, which is $7.6 million above the House.

In a floor amendment, the Senate proposed extending the deadline of the Foundation Budget Review Commission from June 30th to November 1st. This commission is evaluating and recommending updates to the state’s model school budget (the foundation budget) and the Chapter 70 funding system. Under this amendment, the commission would issue a preliminary report in June, and a comprehensive report by November.

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Higher Education

The House and Senate proposals for Higher Education are very similar, with several minor differences detailed in the table below. These discrepancies will be negotiated in a conference committee.

The largest difference within Higher Education is for the University of Massachusetts, which is funded at $18.9 million higher in the Senate budget. Additionally, the Senate budget contains language that would allow UMass to retain tuition and fee revenue from in-state students starting in FY 2017.

Some other notable differences include:

  • The Performance Management Set Aside, which funds competitive grants to campuses to implement The Vision Project, a Department of Higher Education strategic plan, is funded at $3.3 million in the House budget, but is not funded in the Senate budget.
  • High Demand Scholarships, which funds students pursuing majors in high-growth fields such as STEM and health care, is not funded in the Senate budget, but is provided $1.0 million in the House budget. Additionally, the Massachusetts State Scholarship Program is funded at $95.6 million in the House, $2.0 million greater than the Senate proposal.

The Senate added a negligible amount of funding to Higher Education items during floor debate, meaning the final Senate budget is essentially unchanged from the Senate Ways and Means proposal. For more detail on Higher Education, please see MassBudget’s Budget Monitors for the Senate Ways and Means, House Final, and House Ways and Means budgets.

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Environment & Recreation

The state budget funds programs that keep our air, land and water clean, maintain fish and wildlife habitats and staff parks, beaches, pools and other recreation facilities. The Senate budget provides $209.2 million in funding for Environment and Recreation programs. This amount is $1.2 million more than the budget passed by the House and is $11.8 million more than the state expects to spend in FY 2015. Even with this increase, funding for state environment and recreation programs is 29 percent lower in inflation adjusted dollar than it was in 2001 after the state enacted a series of tax cuts.

Over the next several weeks a joint House-Senate Conference Committee will meet to reconcile differences between the two budgets. For a full listing of the differences in funding for Environment and Recreation programs between the House and Senate budgets please see the table below. Some highlights include:

  • The Senate budget provides small amounts to help the state prepare for and adapt to climate change. It provides $300,000 in funding for climate change adaption and preparedness and another $200,000 for a state climatologist. The House does not provide funding for either effort.
  • The House provided $1.2 million in new funding to maintain beaches in Metropolitan Boston. The Senate did not provide funding for this new account.
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MassHealth (Medicaid) and Health Reform

There are numerous funding differences between the Senate’s proposal for MassHealth and health reform and the proposal from the House (see table), but most of the differences are small. MassHealth is the single largest program in the state budget; it helps pay for health insurance to close to 1.7 million people in the Commonwealth (approximately 1 in 4); and it also is one of the largest sources of revenue for the budget, bringing in close to $8 billion each year (see “Understanding the Actual Cost of MassHealth to the State.”) The program is funded jointly by the state and federal governments, with federal reimbursements covering close to half of the state’s costs, and in certain instances significantly more than half of costs.

The most significant difference among the line items is that House proposes $2.50 billion for the Fee-for-Service line item (4000-0700) and the Senate proposes $2.47 billion.  The Senate’s $29.0 million lesser amount incorporates several differences. The Senate estimates $26.6 million in reduced costs due to newly-revised caseload estimates, and also anticipates $3.0 million in savings from what is known as “academic detailing.” Academic detailing provides for academic or other health care professionals without ties to the pharmaceutical industry to provide research-based information to prescribers about the relative effectiveness of various prescription medications. Academic detailing programs have been shown to help reduce prescription drug costs. At the same time, the Senate includes $6.0 million in additional funds targeted to “disproportionate share hospitals” to help reimburse these safety net health care providers for the costs associated with providing health care to low income people. (The Fee-for-Service line item also reflects an adjustment of $6.0 million shifted from the Department of Mental Health into MassHealth totals to support mental health services for people eligible for MassHealth. MassBudget shifts this $6.0 million back to the mental health totals in order to allow for more accurate comparisons – see Mental Health section of this Budget Monitor.)

The Senate budget proposal also includes an additional $3.0 million in funding for managed care (4000-0500) in order to increase rates for mental health and substance abuse providers. The House budget does not include this rate increase.

MassHealth coverage for elders in the community and in nursing homes does not vary significantly between the House and Senate proposals, although the Senate includes $1.0 million less than the House for the MassHealth share of increased nursing home rates, and does not provide $2.8 million to fund incentive payments for facilities that established cooperative employment arrangements between workers at the facilities and their employers (4000-0640). These incentive payments were included in the FY 2015 budget.

The table below lists line items where the House and Senate proposals have funding differences.

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Mental Health

The House and Senate budget differ little in their total funding for mental health, but there are differences in their proposals in the allocation of funding for adult mental health services. The Department of Mental Health serves approximately 21,000 adults and children who have severe and persistent mental illness, and the vast majority of persons receiving mental health services receive those services in the community, rather than in inpatient facilities. Both the House and Senate budget proposals focus funding on community-based services, with the Senate providing slightly more than the House.

The Senate budget includes $2.9 million more than the House for adult mental health services in total, which is just a 1 percent difference. However, the two budget proposals allocate funding slightly differently among the various line items. The Senate includes $6.0 million more than the House for emergency services (5047-0001) to cover emergency services for mental health patients who have MassHealth insurance coverage. The Senate includes $5.4 million less for adult mental health and support services (5046-0000) compared to the House, but $4.2 million more for community-based placements (5046-0005). The Senate total would support an additional 50 community placements for adults currently in mental health continuing care facilities who are ready for discharge into a community placement.

The Senate and House budget proposals for children’s and adolescents’ mental health services both include $3.6 million to fund the Massachusetts Child Psychiatry Access Project (MCPAP), but the Senate proposal includes a new allocation of $500,000 to support the MCPAP for Moms program. This innovative initiative provides mental health screening for pregnant and postpartum women, in order to identify postpartum depression or other mental health issues.

There is a $1.1 million difference in funding between the House and Senate budget proposals for psychiatric hospitals, but both proposals specify that the state will maintain the same number of inpatient beds in FY 2016 as in FY 2015 (at least 671 beds). The Senate proposal includes language to support up to 54 beds at Taunton State Hospital, whereas the House budget language specifies 45 inpatient beds at Taunton State Hospital.

The table below lists line items where the House and Senate proposals have funding differences.

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(Note that totals for certain line items in both the House and Senate proposals have been adjusted to allow for better year-to-year comparisons. These adjustments account for simple shifts of funding from one line item to another.)


Public Health

The Senate budget proposal funds public health services at approximately $6.2 million more than the House budget, with much of the increased funding going to services to prevent and treat substance abuse. Funding for the state’s public health programs is essential for helping keep the Commonwealth healthy, as it supports a wide variety of prevention and wellness programs, substance abuse treatment initiatives, programs that help vulnerable populations get access to health care, and essential environmental health and regulatory programs that keep the air and water clean. Compared to the House, the Senate also directs less funding in totals to the line items supporting youth engagement programs, and recommends more funding for substance abuse programs. There are also funding differences in many other line items as well (see detailed table below.)

To support the provision of substance abuse treatment and services within the budget, the Senate directs a total of $117.1 million, $5.0 million above the House proposal. There is a difference in the allocation of funds, and MassBudget makes some adjustments to these numbers in order to allow for more accurate comparisons (see table below). The Senate proposes $10.0 million for the Substance Abuse Services Fund (4512-0210), established to increase the number of people receiving services from the bureau of substance abuse services in the Dept. of Public Health. The House budget did not direct money to this trust, but instead proposed more funding for the department’s Bureau of Substance Abuse Services (4512-0200) and Substance Abuse Step-Down Services (4512-0201).

There are several substance abuse initiatives, including two new line items. The Senate creates a new line item with $3.1 million to focus on funding for Recovery High Schools (4512-0211), however only $1.5 million of that is new funding and the remainder is simply a shift from the Bureau of Substance Abuse Services. (MassBudget adjusts the totals to reflect that shift.) Recovery High Schools provide a safe and therapeutic environment for youth working towards recovery from substance abuse disorders, and this funding would allow for the creation of two new programs.

The Senate also creates a new line item with $100,000 to cover the costs of a municipal Naloxone bulk purchase program (4590-0930). This program (detailed in Section 27) would allow for the state office of pharmacy services to assist municipalities in the bulk purchasing of naloxone (“Narcan”). Narcan is a drug that is often lifesaving in its ability to reverse opioid overdose. This program would also assist municipalities in providing training of first responders in the use of the medication.

The Senate also provides $200,000 for an initiative to support the care of infants born with neonatal abstinence syndrome; the House proposes $100,000. The House puts this funding in the Bureau of Substance Abuse Services, while the Senate puts it in Family Health Services (4513-1000). The Senate also proposes $500,000 more than the House for comprehensive family planning, also funded in the Family Health Services line item.

On the other hand, funding for domestic violence programming is less in the Senate than in the House – together the Senate funds the domestic violence program (4513-1130) and the sexual assault nurse examiner program (4510-0810) at $1.1 million less than the House.

There are two line items funding programs to promote positive youth engagement for children and adolescents at risk of violence. The Safe and Successful Youth Initiative program (4000-0005) which provides programming for high risk youth most at risk of gun violence receives $5.0 million in the Senate, and $6.0 million in the House. The Youth-At-Risk grant program (4590-1507), which supports funding for afterschool programming at community centers such as YMCAs and Boys and Girls Clubs, receive $3.9 million in the Senate and $3.8 million in the House.

The Senate provides $28.4 million for the Early Intervention program (4513-1020), while the House proposes $27.6 million. This program provides a variety of community-based therapies to infants and toddlers who already are showing developmental delay or who are at risk of developmental delay. In particular, the program has seen an increase in referrals for children involved with the Dept. of Children and Families, and children born with prenatal exposure to alcohol, opioids, or other addictive drugs.

The table below lists line items where the House and Senate proposals have funding differences.

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(Note that totals for certain line items in both the House and Senate proposals have been adjusted to allow for better year-to-year comparisons. These adjustments account for simple shifts of funding from one line item to another.)


State Employee Health Insurance

The Senate budget proposal funds state employee health insurance at $8.0 million less than the House, allocating slightly less for the cost of state retiree benefits. The Commonwealth is one of the largest employers in the Commonwealth and provides health insurance to thousands of current and retired employees. The costs of this coverage are shared, with the state paying for a portion of the coverage and employees (or retirees) paying a portion. Although the state’s Group Insurance Commission (that oversees the administration of this health insurance) has historically been an effective and aggressive negotiator with health insurance companies to keep health insurance costs for the Commonwealth as low as possible, like all employers, the Commonwealth has been confronting rising health care costs over the years.

State Retiree Benefits

The state has adopted a schedule to move towards full funding of health and non-pension post-employment benefits (“OPEB”) for retirees. In Fiscal Year 2012, the state decided to gradually dedicate an increasing share of the Master Tobacco Settlement agreement funds awarded to the state to the State Retiree Benefits Trust to fund this liability. In FY 2015, the state did not make the transfer from the Tobacco Settlement, and instead directed this portion of the settlement funds back into the General Fund in order to help balance the budget, and instead plans on making up the funding with unexpended debt service appropriations. If that amount is insufficient, the remainder would come from the Tobacco Settlement funds.

In FY 2016, the planned transfer amount would be approximately $109 million, but both the House and Senate budget proposals suspend this transfer, and also reduce the amount to be directed to state retiree benefits from $109 million to approximately $84.6 million. To make the transfer, the Senate proposes using unexpended debt service appropriations at the end of the year, with the balance to be made up for by tax amnesty revenues in excess of $100 million. The House proposed using unexpended debt service payment appropriations with the remainder coming from a transfer from the General Fund. In all instances these proposed transfers total $24.3 million less than the amount stated in the statute. In addition, there is a direct appropriation through an operating transfer of funds into the trust fund. The House budget includes a transfer of $433.0 million, the Senate proposed $425.0 million.

(In order to allow for more accurate year-to-year comparisons, MassBudget adjusts the State Employee Health Insurance budget totals by excluding amounts associated with municipal and retired teacher participation in the Group Insurance Commission. This spending is fully-funded by revenues from the municipalities, and therefore are not included in our analysis of the state budget.)

The table below lists line items where the House and Senate proposals have funding differences.

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Housing

The state budget funds affordable housing assistance and shelter for low income homeless families and individuals. The final Senate budget for Fiscal Year (FY) 2016 recommends spending $434.1 million on affordable housing programs which is $4.1 million more than the House FY 2016 budget and is slightly below the $434.5 million the state expects to spend in FY 2015.

In their respective budgets, both the House and the Senate decrease funding for shelter to low-income homeless families while increasing funding for programs that help families move from shelter into housing or prevent them from becoming homeless. The House and Senate budgets, however, fund these efforts differently. A joint Conference Committee will iron out these differences. For a full list of differences between the House and Senate budgets please see the table below.

A large portion of the affordable housing budget funds programs that assist eligible low-income families who are homeless. In FY 2015 the state provided $191.8 million for Emergency Assistance (EA) which funds both state-supported shelters and hotels and motels when the family shelters are full. In their FY 2016 proposals, the House and Senate budgets recommend spending about $154 million which is approximately $37 million less than the amount the state expects to spend in FY 2015. As noted in our Budget Monitor for the Senate Ways and Means Budget HERE, previous year’s budgets have reduced funding for EA at the beginning of each fiscal year in anticipation that fewer homeless families will need shelter. But over the course of each year the need for shelter has exceeded the amount provided in the original budget and the Legislature has approved supplemental funding.

While the House and Senate budgets provide similar funding for EA, there is one notable difference in the language governing the circumstances under which low-income homeless families are eligible to receive shelter. (For a full description of eligibility criteria for EA please see MassBudget’s Children’s Budget HERE.) Recently the state tightened eligibility for EA which has forced some homeless families with children to live in places not meant for human habitation like a car, a public park, or a hospital emergency room before they can access shelter. The Senate budget requires that the Department of Housing and Community Development (DHCD) provide shelter to these families so they do not have to sleep in such places before they are permitted to live in shelter. This provision is not included in the House budget.

As the House and Senate budgets recommend reducing funding for EA below the FY 2015 budget, they increase funding for housing resources. However, the two budgets differ in how they allocate additional resources to provide supports to families who are homeless or at risk of becoming homeless. Some differences include:

  • The Senate provides $85.4 million for the Massachusetts Rental Voucher Program (MRVP) which is $2.5 million above the $82.9 million that the House provides. The House budget, however, also allows DHCD to transfer up to $8 million in unspent funds from FY 2015 into FY 2016. The Senate budget does not include this transfer, instead any unspent MRVP funds from FY 2015 will be transferred into the Affordable Housing Preservation and Stabilization Trust Fund (HPSTF) which DHCD can use to support MRVP or other affordable housing programs.
  • The House budget provides a $5.0 million deposit into HPSTF which the Senate budget does not.
  • The Senate budget provides $7.0 million for a new end family homelessness reserve housed at the Executive Office of Health and Human Services (EOHHS). This reserve, first proposed in the Governor’s budget with $20.0 million, would provide short-term, tailored assistance to families who are homeless or at risk of becoming homeless. The House budget does not provide funding for this reserve.
  • The House budget provides $31.3 million for HomeBASE which is $5.0 million more than the Senate proposal. 
  • The Senate budget provides $13.0 million for Residential Assistance for Families in Transition (RAFT) which is $1.0 million more than the House.

The House and Senate budgets also include a number of new programs in their respective budgets which will have to be reconciled in conference.

  • The House budget provides $1.0 million for the Urban Housing Agenda which provides planning grants to develop new affordable rental or homeownership housing in urban areas. This proposal, also included in the Governor’s budget, is not included in the Senate’s proposal.
  • The Senate provides $2.0 million for a program to provide shelter and services to unaccompanied homeless youth who are up to 24 years old. The House does not include this provision.
  • The Senate proposes spending $500,000 for a housing authority self-sufficiency pilot program, outlined in Outside Section 93 of the Senate budget, which is modeled after the program that the Worcester Housing Authority is undertaking. (For a full description please see the Housing Section of the Senate Ways and Means Budget Monitor HERE.) The House budget does not include this new provision.

Child Welfare

While the majority of child welfare line items needing to be reconciled in Conference Committee have small funding differences, one account contains a larger variance – Regional Administration. The House eliminated this line item as it has for the last few years while the Senate provided $6.0 million, level with FY 2015 current spending. Regional Administration funds contracts with nonprofit “lead agencies” that help coordinate services for the Department of Children and Families (DCF). Proponents of lead agencies note the important coordination function they fill between DCF social workers, families and other professionals involved in a child's case. Critics claim that lead agencies duplicate work done in the past by social workers and that funding should be spent on services.

The Senate proposes less funding for a few programs providing:

  • $250.4 million for Group Care, $2.9 million less than the House
  • $24.3 million for Domestic Violence Support Services, $1.9 million less than the House

The Senate also does not provide funding for the Commission on the Status of Grandparents Raising Grandchildren. The House provided $80,000 for this commission which provides information and support for grandparents, and advice to the state on the potential effects of proposed legislation.

During floor debate the Senate adopted an amendment providing $2.0 million more for Social Workers for a total of $203.8 million, $2.0 million more than the House. The amendment also included language calling for a monthly report to the legislature detailing current average caseloads and how many more case workers would be needed to get to a 15 to 1 ratio.

The Senate provided $45.6 million ($900,000 more than the House) for Family Support and Stabilization. These services are vital in helping families involved with DCF keep their children safely at home.

One House amendment not included in the Senate proposal would require fingerprint checks for all persons older than 14 in a family applying to become a foster, kinship, or adoptive family, and also for many of the people contracting with DCF to work with these kids. Some of these checks are already required by federal and state laws.

Funding for Family Resource/Access Centers is located in two line items (4800-0200, 4000-0051). The Senate provides $9.9 million in total, $2.5 million more than the House. These centers currently make it easier for children and families to access many public services including Transitional Aid to Families with Dependent Children (TAFDC), Supplemental Nutrition Assistance Program (SNAP), Women, Infants, and Children’s Program (WIC), Fuel Assistance, and MassHealth.

There is a small difference in total funding for Services for Children and Families. Both the House and Senate provide around $278 million. Both proposals include a number of earmarks, some of which are different and will need to be reconciled in conference.

The table below illustrates all differences which will have to be reconciled in Conference Committee.

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Elder Services

The Senate provides $266.1 million for Elder Services, $3.7 million above the final House proposal. Of note, Elder Home Care Purchased Services and Elder Home Care Case Management and Administration combined receive $142.2 million, $4.0 million more than the House. These increases would likely eliminate waiting lists prompted by mid-year cuts in FY 2015 and allow more seniors to age in place instead of living in a nursing home.

The Senate also passed an amendment that could expand access to home care services which is not included in its proposed budget figures. The funding for this expansion (up to $6.3 million) is largely contingent upon additional revenue and/or a surplus in the Community First Trust Fund. If funded, this change would expand the eligibility requirements for home care services—including raising the income eligibility ceiling—allowing more seniors access to these vital services.

In addition to the amendment outlined above, the table below illustrates all funding differences that must be reconciled in conference committee.

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Disability Services

The Senate proposes funding disability services at $1.83 billion, $12.4 million below the House. Although this net difference is small, many of the line item appropriations vary between the House and Senate proposals (see table below).

There are significant differences between the House and Senate proposals in workforce development and group programs for people with disabilities:

  • The Senate proposes funding Community Day and Work Programs for the Developmentally Disabled at $173.5 million, $9.7 million below the House. These programs offer a wide variety of group and individual supports, helping people with developmental disabilities find work and build skills.
  • The Senate proposes funding Community Based Employment at $5.0 million, $2.0 million above the House. This program provides funding to move individuals with disabilities from sheltered work to integrated work settings.
  • The Senate proposes funding Community Transportation Services for the Developmentally Disabled at $19.0 million, $3.0 million below the House. These services allow individuals with disabilities to maintain employment and take part in community activities.

In addition, the Senate proposes funding Autism Omnibus Services at $6.3 million, and the House proposes funding Autism Services at $12.4 million. Both line-items provide services to individuals with autism spectrum disorders. Some of this funding supports programs which in the past have been funded in Respite Family Supports and Department of Developmental Disabilities Administration (DSS Administration). In order to make apples-to-apples comparisons, we do not include the additional dollars coming from Respite Family Support and DDS Administration. In total, the House proposal is about $5.6 million higher than the Senate proposal.

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Juvenile Justice

Four Juvenile Justice programs will need to be reconciled by the conference committee. Most of the differences between the Senate and House proposals are quite small. Residential Services for Committed Population has the largest difference with the House providing $120.2 million, $3.2 million more than the Senate. The Senate made one change during debate adding $500,000 for Residential Services for Detained Population.

The table below illustrates all differences which will have to be reconciled in Conference Committee.

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Transitional Assistance

The House and Senate provided different funding levels for both Transitional Aid to Families with Dependent Children (TAFDC) and Emergency Aid to the Elderly, Disabled, and Children (EAEDC). Client projections for FY 2016 will partly determine funding levels for these two programs. However, the Senate made one change within TAFDC which will have to be reconciled in conference. The Senate increased a clothing allowance from $150 to $200. This clothing allowance is a one-time payment made in September helping poor families pay for back-to-school clothing. The House kept the clothing allowance at $150.

There are a few programs though with funding differences which will need to be reconciled in conference. The Senate provided $12.1 million for the Employment Services Program, $848,000 more than the House. This program provides TAFDC recipients with education, occupational skills and the employment support services needed to acquire and retain jobs. For an in depth analysis on funding for education and job training programs, see Declines in Work Supports for Low-Income Parents.

The Senate also proposes $5.0 million for Pathways to Self Sufficiency, a new program offering job training to help TAFDC recipients get and keep jobs. The House provided no funding for this program which was initially funded at $11.0 million in a FY 2015 supplemental budget bill in July which accompanied a welfare bill changing the disability standard.

The Senate also included two outside sections not in the House proposal. In Section 91, the Senate proposes the Job Support Services Plan which would provide job support services to TAFDC recipients who will no longer be exempt from work requirements due to the change in the disability standard. The program would utilize specialists in each community service area to help find jobs, training or education. Section 92 would develop a Family Well- Being pilot program in at least two DTA offices to support participants who are still exempt from work requirements. The program would help assess barriers to employment and lay out a plan for helping them qualify for other services. The Senate provides $1.0 million specifically for transportation and child care services for participants of this program.

The table below illustrates all differences which will have to be reconciled in Conference Committee.

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Economic Development

In Massachusetts, we support workforce and business development programs in order to boost the skills of working people and stimulate economic growth. The Senate proposes funding economic development at $137.9 million. While slightly above the House proposal (3 percent), the Senate proposal would still be 52 percent below FY 2001 levels, adjusted for inflation.

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The Senate proposal is higher than the House proposal in several workforce development programs:

  • The Senate proposes funding YouthWorks at $11.7 million, $2.2 million over the House proposal. This program provides summer and some year round jobs about 5,000 low-income and at-risk youth living in targeted communities.
  • The Senate proposes adding $2.2 million to the Workforce Competitiveness Trust Fund, which helps workers build skills necessary to get jobs in high demand industries such as health care, construction and education. The Baker Administration eliminated funding for this program during mid-year cuts.
  • The Senate proposes funding One-Stop Career Centers at $5.1 million, $1.1 million over the House proposal. These centers helps job seekers, particularly those receiving unemployment insurance, improve their skills and navigate the job search process.
  • The Senate proposes funding Advanced Manufacturing Workforce Development Grants at $1.5 million. The House did not propose funding into this grant program, which provides training in precision manufacturing for unemployed and underemployed workers.

The Senate also proposes not to fund several new programs proposed by the Governor and House, such as Working Cities Technical Assistance Grants, Urban Agenda Economic Development Grants and Mass Port Authority Tourism.

Finally, the Senate proposes funding a new program, North Shore InnoVentures, at $100,000 which supports the development of early stage biotech and clean tech businesses.

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Local Aid

The House and Senate propose equal funding of $979.8 million for Unrestricted General Government Aid (UGGA). UGGA is the state’s main non-school local aid program, which helps support vital local services across the Commonwealth.

The Commonwealth’s ability to support general local aid has been hindered by significant state-level tax cuts during the 1990's and 2000's combined with the recent recession. While over the past few years, funding for general local aid has increased with or slightly above inflation, under the House and Senate proposals, it still remains 43 percent below FY 2001 levels, adjusted for inflation.

The one local aid program with a major difference between the House and Senate proposals is the Municipal Regionalization and Efficiencies Incentive Reserve, which supports initiatives that improve the delivery of local services. The Senate proposes $4.7 million more than the House for this program.

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Transportation

In large measure, the Senate’s FY 2016 budget agrees closely with that of the House on matters related to Transportation. Among the most notable aspects of the Senate FY 2016 budget are the changes it makes relative to the Massachusetts Bay Transit Authority (MBTA). The Senate, like the House, proposes changes to the rules governing the structure of the board of directors for the Massachusetts Department of Transportation, which oversees the MBTA (for details, see the Transportation section of MassBudget’s SWM Budget Monitor). Unlike the House, the Senate does not adopt a set of provisions - included in the budgets of both the House and the Governor - that would place a 5-year moratorium on “Pacheco Law” regulations for the MBTA. The Pacheco Law requires public agencies to prove cost-savings (which may not be achieved through lower wages) before outsourcing publicly funded projects to private contractors (for a detailed discussion of these regulations see MassBudget’s Pacheco Law factsheet). This substantial difference will need to be reconciled during conference.

During floor debate the Senate added a proposal to create a Fiscal Management Control Board for the MBTA that would sit within the Department of Transportation and report to the Secretary of Transportation.1This five-person board would be empowered to “initiate and assure the implementation of appropriate measures to secure fiscal, operational and management stability of the MBTA.” A similar plan was proposed in the House during floor debate, but was not adopted as part of the final House budget. This difference between the House and Senate budgets will need to be reconciled in conference.

For additional discussion and details regarding the Senate proposals on Transportation, see the Transportation section of MassBudget’s SWM Budget Monitor.


Law & Public Safety

Overall, funding levels provided by the Senate and the House for Law & Public Safety programs are very close – out of a total budgetary outlay for these programs of $2.63 billion, the two budgets differ by only $17.5 million, or less than 1 percent. This similarity in total funding levels, however, masks the substantial differences that exist at the line item level – more than one hundred specific Law & Public Safety accounts are funded at different levels in the Senate vs. the House budget. These differences will need to be resolved in conference.

In the area of Courts & Legal Assistance, the Senate provides a net of $13.7 million more than the House for the trial courts (including both increases and some reductions), both for the Office of the Chief Justice for Administration and for individual court accounts. The Senate also provides a net of $3.4 million more than the House for legal assistance, including the Committee for Public Counsel Services (CPCS, $2.6 million more), CPCS attorneys’ salaries ($1.9 million more), the Massachusetts Legal Assistance Corporation ($100,000 more), and Indigent Persons’ Fees and Court Costs ($1.3 million less).

In the area of Law Enforcement, the Senate provides a net of $1.8 million more than the House, including an additional $2 million for the Shannon Grant Gang Prevention program ($8.0 million total) and $1.0 million less for the Department of State Police Operations ($267.8 million total).

In the area of Prisons, Probation & Parole, the Senate provides a net of $7.0 million less than the House. While many Sheriffs’ Departments primary accounts receive slightly more under the Senate than the House budget, most retained revenue accounts for federal reimbursements are lower under the Senate proposal.
For Prosecutors, the Senate provides a net of $2.0 million less than the House, though this total takes into account the $3 million the House proposes for a reserve account for District Attorneys’ salaries, which the Senate chooses not to fund. In general, the Senate provides more funding than the House for individual DAs’ offices, but less for special investigative units and other special programs.

In the area of Other Law & Public Safety programs, notable differences between the Senate and House include the following:

  • $2 million provided by the Senate to fund an Illegal Tobacco Task Force
  • $3.8 million (or 19 percent) more from the Senate than the House for the Department of Fire Services Administration
  • $969,000 (or 23 percent) more from the Senate than the House for the Department of Public Safety, but $363,000 (or 12 percent) less than the House for the Executive Office of Public Safety and Security
  • $750,000 provided by the Senate for evidence-based programming grants, “to pilot or expand new or current innovative and evidence-based approaches for improving recidivism outcomes.

Revenue

During floor debate, the Senate adopted an amendment making changes to several elements of the state’s personal income tax system. The House budget contained no such provisions. The Senate tax package represents the most significant difference, revenue wise, between the House and Senate FY 2016 budgets. This difference will need to be worked out in conference. Specifically, the Senate’s proposal would do three things:2

  • Freeze the state’s personal income tax at the current 5.15 percent. Under current law, the rate very likely will be reduced in stages to 5.0 percent over the next several years (read more about these automatic rate reductions here).
  • Increase the state’s personal exemption amounts by $400 (to $4,800), $600 (to $7,400), and $800 (to $9,600) for single, head of household, and married joint filers, respectively. The personal exemption is automatically deducted from each filer’s income before taxes are applied, thereby reducing taxes owed (learn more about the structure of the Massachusetts personal income tax – including the personal exemption - here).
  • Increase the Commonwealth’s Earned Income Tax Credit (EITC). Currently, the Massachusetts state EITC is equal to 15 percent of the amount a filer receives through the federal EITC program (read more about the Massachusetts EITC here). The Senate’s proposal would raise this percentage in three steps to 22.5 percent, by 2018.

In its first year of implementation, the Senate’s package would be essentially revenue neutral. On average, during this first year, the bottom 60 percent of Massachusetts households would see modest tax decreases of $10 to $40 - some EITC recipient households would see more substantial cuts of about $150 to $200. Only the very highest income households (those in the top 1 percent, with incomes averaging over $2.5 million annually) would see substantial tax increases, approaching a thousand dollars, on average.

A second substantial difference between the Senate and House budgets is their respective funding for the Department of Revenue (DOR). The Senate FY 2016 budget proposes funding DOR’s tax activities at $130.2 million, an amount $9.4 million above the House, $8.1 million above the FY 2015 GAA and $14.5 million above the FY 2015 current budget. (In FY 2015, as revenues fell short of the amount projected, Governors Patrick and Baker made a combined $6.4 million in emergency cuts to DOR’s Office of Tax Administration (OTA)).

The OTA, which makes sure that taxpayers are paying taxes they legally owe to the state, is funded through two primary accounts. The Administrative Account (1201-0100) pays the salaries of auditors and collectors, as well as support staff and lawyers. The Additional Auditors Retained Revenue account (1201-0130), created in FY 2004, allows the DOR to retain a certain portion of the unpaid revenue it collects to help pay auditors’ salaries. The combined $9.4 million difference in these accounts between the Senate and House will have to be reconciled in conference.

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In documents accompanying its FY 2016 budget proposal, the Senate Ways and Means Committee noted that of its $8.1 million increase above the FY 2015 GAA, $4.0 million of it would allow the OTA to hire 40 additional auditors allowing the state to collect an estimated $20 million in additional revenue in FY 2016. Many audits, particularly of multinational and multistate corporations that owe taxes to the Commonwealth, can be highly complex and time-consuming. By allowing the OTA to hire additional auditors, the Senate budget proposal would increase the OTA’s ability to collect taxes legally owed to the Commonwealth. It is also likely that by increasing the OTA’s capacity to conduct complex tax audits, taxpayers, including large corporations, will be more likely to comply with the Commonwealth’s tax laws rather than engage in complex evasion schemes to avoid paying taxes they legally owe to the state.

Beyond the Senate’s tax package and higher funding levels for DOR, the Senate also approved a provision imposing a 170 percent excise tax on “fruit-flavored or other nontobacco-flavored” cigars and smoking tobacco.3 Up to $4 million of the revenue raised from taxing these products will be directed to smoking prevention and cessation programs. The House does not include such a provision in its budget.

Other notable tax-related differences between the House and Senate budgets include Senate proposals to enhance the Department of Revenue’s auditing and collecting capacities; enhance tobacco law enforcement and tax collections; and close a loophole in the states’ combined reporting law. Details on these proposals and other tax-related elements of the Senate’s FY 2016 budget can be found in the revenue section of MassBudget’s Senate Ways and Means Budget Monitor.

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Non-Tax Revenue

There are three main types of non-tax revenue: federal revenues, which are mostly reimbursements from the federal government for state spending on the Medicaid (MassHealth) program; departmental revenues, which are fees, assessments, fines, tuition, and similar receipts; and other revenues, which are mostly funds that the state draws from an assortment of non-budgeted trusts.

There are no significant differences between the House and Senate budget proposals for non-tax revenue. One minor difference is in treatment of the state’s Stabilization (“Rainy Day”) Fund. Current law requires that if the Commonwealth collects capital gains tax revenue in excess of $1.09 billion, that excess would be transferred to replenish the Rainy Day Fund. The House budget proposal suspends the requirement to transfer excess capital gains tax revenue into the Rainy Day Fund, and instead retains all capital gains tax revenue in the General Fund. The Senate, on the other hand, proposes retaining in the General Fund the first $300 million in excess capital gains tax revenues received above the $1.09 billion threshold, and then transferring any excess capital gains tax revenues above that into the Rainy Day Fund. Although these are different approaches to whether excess capital gains tax revenues should be used to replenish the Rainy Day Fund, the state’s Dept. of Revenue does not anticipate more than $300 million in excess capital gains revenues this year, so in effect the two budget proposals are not dramatically different on this score.

Other Savings or Reductions in Spending

The state has adopted a schedule to move towards full funding of health and other post-employment benefits (“OPEB”) for retirees (see State Employee Health Insurance section of this Budget Monitor for description.) However, by funding this liability at less than the amount established by statute, both the House and Senate “save” $24.3 million. The House and Senate have proposed different strategies to fund this liability.

Budget by Program Area

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