This analysis represents the next step in the FY 2027 state budget creation process.
The Conference Committee, consisting of six members, three from the House of Representatives and three from the Senate, released their FY 2027 budget proposal (HB555) on June 30. This conference budget proposal reconciled the differences between the House (HB5501) and the Senate’s (SB3100) budget proposals. This conference budget proposal includes $2.7 billion in revenue from the Fair Share surtax, the voter-approved ballot initiative that enacted a surtax on the highest incomes in Massachusetts.1
In this analysis, we examine selected programs in the proposed FY 2027 conference budget where were reconciled.
This analysis covers the following topics (click on one to be taken to that section):
Transportation, Education and Local Aid, Child Care, Housing, Tax Assistance, and other Human Service programs.
Continuation of Regional Transit Authorities (RTAs) Fare-Free Buses
Fare-free transit at the Regional Transit Authorities (1595-6370) is an important achievement made possible through funding from the Fair Share surtax. The Conference Committee proposed $40 million for year-round, fare-free RTA services in FY 2027. This is a $5 million increase over the FY 2026 appropriation and will enable all 15 RTAs to continue providing fare-free bus services. Bus fare is a regressive type of state revenue. Public bus riders tend to be people with lower incomes, often with no other means to get to places than public transportation. Bus fares represent a disproportionately larger share of these individuals’ incomes. Fare-free transit has led to dramatic increases in ridership. For example, free fares in the Southeastern Regional Transit Authority contributed to ridership growth 13 to 14 times faster compared to two neighboring transit agencies that charged fares.
Funding for K-12 Schools to Address Declining Enrollment of English Learners
The Conference Committee proposal establishes a new $4 million reserve fund (1599-0008) to address declining enrollment of multilingual learners in school districts across the Commonwealth. Recent reporting has highlighted growing concern within communities about immigration enforcement activity, including the presence of Immigration and Customs Enforcement (ICE) agents in Massachusetts.2 These concerns may make some families hesitant to engage with public institutions, including schools. While this is less than the $10 million the House proposed, this reserve fund will help support school districts that have lost funding due to multilingual students enrollment decline. This is an important recognition that more needs to be done to support districts and communities experiencing this challenge. However, this funding level does not adequately address the widespread and significant enrollment losses from FY 2026 to FY 2027.
Eliminates the Learnfare Policy
The Conference Committee proposes repealing the “learnfare” policy. Current policy requires children ages 6-16 who receive cash assistance through the Transitional Assistance to Families with Dependent Children (TAFDC) program to attend school regularly. Families whose children have too many unexcused absences may lose the child’s portion of the cash assistance grant (referred to as “learnfare”). This is an inequitable and ineffective policy that punishes families experiencing deep poverty, and does not address the issue of chronic absenteeism.
Consideration of Long-Term Policy Solutions to Education and Local Aid
The Conference Committee considered three commissions, all proposed by the Senate, that would address funding formulas focusing on education and local aid to Massachusetts cities and towns.
The Conference Committee budget proposal only included a Foundation Budget Review Commission (FBRC) (Outside sections 64 and 111) that would recommend updates to the public pre-K through 12 funding formula (Chapter 70) and issue a report by October 31, 2028. It would also incorporate a separate Department of Elementary and Secondary Education (DESE) local contribution study and identify available resources to fund additional education program costs. It may also examine other school finance programs such as rural school aid, charter school costs, out-of-district special education costs, and municipal school district transportation costs. The commissions to study the funding formulas for the Massachusetts School Building Authority (MSBA) and the Unrestricted General Government Assistance (UGGA) were not included in the Conference Committee proposal.
Support Universal Pre-K Expansion Continues but at Reduced Levels
The Conference Committee proposes approximately $10.5 million (3000-60253) in Fair Share surtax revenue for the Commonwealth Preschool Partnership Initiative (CPPI). This is a $5 million reduction compared to the enacted FY 2026 General Appropriations Act (GAA) budget. As MassBudget’s recent research shows, CPPI grants facilitate partnerships between the Department of Early Education and Care (EEC), local school districts, and community-based child care providers to offer low- to no-cost prekindergarten in a community. Governor Healey’s Gateway to Pre-K initiative sought to expand CPPI into every Gateway city by 2026. CPPI is currently in 19 of 26 Gateway cities. This funding level, however, would not allow expansion into new communities, and will likely jeopardize programming in current CPPI communities.
Funding for the Administration of the Office of Early Education and Care
Accounting for other expenditures required by earmarks, the Conference Committee proposes just under $9.2 million to support EEC operations (3000-1000). Funding in this line item directly affects EEC’s staffing capacity and the agency’s ability to deliver high-quality programming and support to children, families, and educators. This proposal falls short of what was proposed in the governor’s FY 2027 budget (over $13 million).
Provides Some Needed Funding for Critical Housing Programs
The Conference Committee proposes $209 million for Residential Assistance for Families in Transition (RAFT, 7004-9316) program, which helps individuals and families facing eviction, foreclosure, loss of utilities, and other housing emergencies to remain housed. The housing affordability crisis in Massachusetts is such that in FY 2026 RAFT initially received $207.5 in the FY 2026 General Appropriations Act (GAA) and later received $13.8 million more from an FY 2025 supplemental budget that was carried over to FY 2026. This additional funding enabled the Executive Office of Housing and Livable Communities to take steps toward addressing the heightened demand for housing assistance needs. While the proposed FY 2027 funding is a slight increase above the FY 2026 GAA amount, it is still less than the total appropriations for FY 2026. The housing affordability crisis is showing no signs of declining. Therefore, it is imperative for the state to continue investing in programs like RAFT that keep people safely housed and actively participating in the local and state economies.
The Conference Committee proposes $278.3 million for the Massachusetts Rental Voucher Program (MVRP, 7004-9024), the state’s primary rental voucher program, providing families with financial assistance to afford the increasing cost of rent. The proposed increase in funding would allow the program to add new vouchers, helping households experiencing housing instability or homelessness access affordable housing. The amount is approximately $25 million more than the FY 2026 budget. According to the Senate Ways and Means budget, this funding amount would allow the state to support more than 11,500 mobile and project-based rental vouchers in total.
Inadequate Funding for Critical Tax Assistance for Filers with Lower Incomes
The Conference Committee proposes $500,000 for the Volunteer Income Tax Assistance (VITA) sites (1201-0100), less than the $1.5 million needed to adequately support this program. The program has experienced significant cuts every year since FY 2023, and the Committee proposes the same funding level as in the FY 2026 GAA. There are more than 80 VITA sites across the Commonwealth, serving over 30,000 taxpayers with low incomes. VITA assists these taxpayers by helping them access free tax preparation, claim refundable tax credits, and connect to other services like the Women, Infants, and Children (WIC) food program and Head Start. These sites are also crucial to ensure the maximum impact of the Child and Family Tax Credit, the expanded Earned Income Tax Credit, and the Senior Circuit Breaker. VITA funding is even more vital in light of other federal cuts to tax assistance programs.
Support for DTA Caseworkers Would Decline as Need Increases
The Conference Committee proposes $122 million in funding for Department of Transition Assistance (DTA) caseworkers (4400-1100). This would be a nearly $21 million cut from expected FY 2026 funding.4 According to an analysis conducted by the Massachusetts Law Reform Institute (MLRI), the proposed funding would result in approximately 150 caseworkers being laid off. These caseworkers help administer programs like the Supplemental Nutrition Assistance Program (SNAP), Health Incentive Program (HIP), and employment and training – all serving families and individuals with low incomes. Providing adequate funding to ensure DTA staffing is keeping up with increased need is critical for families to receive much-needed food assistance benefits. It is also crucial for maintaining essential federal funding for years to come in light of new eligibility barriers to SNAP and other human service programs included in recent federal legislation. Instead of cutting, the state should be increasing this funding and adding even more DTA caseworkers.
Failing to address the shortage of caseworkers is also likely to have serious consequences for federal funding moving forward. Eligibility changes to SNAP, and other human service programs included in the federal “One Big Beautiful Bill Act” (OB3) legislation, together with the requirement to states to assume part of the cost of the program benefits, will require skilled and experienced caseworkers to ensure program users comply with new eligibility requirements and reduce the Payment Error Rate (PER). Failure to reduce the rate will result in Massachusetts having to assume a larger percentage of the cost of SNAP benefits, totaling potentially hundreds of millions of additional dollars.
Looking Forward
Massachusetts lawmakers released a conference budget proposal within a volatile and unpredictable funding environment. Lawmakers should consider other ways to prepare for impending federal revenue cuts by growing the budget to more adequately fund much-needed programs, services, and infrastructure across the state. Lawmakers continue to have the opportunity to demonstrate that they can create a Commonwealth where everyone, independently of their race, nationality, and socioeconomic background, can thrive.
The budget now moves to the governor to make potential vetoes and then provide their signature to enact the FY 2027 General Appropriations Act (GAA). MassBudget will conduct an in-depth analysis of the GAA budget in the coming weeks.
Endnotes
1 An FY 2026 supplemental budget enacted in June 2026 that includes Fair Share surtax revenue because the Fair Share surtax brought in above-estimated revenue collections in FY 2025. As of the end of April 2026, FY 2026 Fair Share surtax revenue collections had already exceeded $3.1 billion, over $700 million above the $2.4 billion budgeted for Fair Share in FY 2026. After the final FY 2026 Fair Share collections are certified at the end of December 2026 (and 15 percent of the overage is directed to the Education and Transportation Stabilization Fund), the remainder will be available for a FY 2027 Fair Share supplemental budget.
2 English Learner students are not synonymous with immigrants or children without status. There are United States-born students who are developing English proficiency, and many immigrant students are already proficient in English. However, English Learner status is currently the closest proxy available in publicly reported education data for tracking trends that may affect immigrant communities.
3 The total line-item appropriation is $15.5 million, but according to earlier reporting, approximately $5 million would be earmarked for the Summer Step-Up program.
4 $41.6 million was provided in a FY 2026 supplemental budget in addition to funds that were provided in the initial FY 2026 GAA budget. Together they bring the FY 2026 funding total to $142.8 million.
