House State Budget Wrap-up (Spending)

The following is the press release we put out on the budget. We passed a budget that closed a #.6 billion budget gap through revenue increases, cuts to line items (including elimination of dozens of line items), and changes in programs (reforms) that lead to tens of millions in savings. The budget is balanced and we can move forward in the process.
Two items to note in the process were that we didn’t use any of our stabilization funds and we took a hit on insurance for our own state employees. With regards to the stabilization fund, it is down to $1.2 billion and we will need some of this to balance our books at the end of this fiscal year. We need to keep the rest as we know that this budget crisis will not end in one fiscal year. We will need this and the pain of dealing with short revenues and unmet needs will go on for several fiscal years. Charley Murphy, the Chair of Ways and Means deserves a lot of credit for not responding to the moment and planning for the future by keeping this money from being spent now.

As for the insurance increase, I wanted to keep our insurance split at 85-15. In other words, we pay 85% of the costs and the worker pays 15%. We ended up at 80-20. I know that most people will not understand this and will insist that workers pay more for their insurance. I know that people will point to the fact that most private employees pay more as a percentage of the costs. However, we shouldn’t spring this on our workers during a budget debate which gives them little or no time to plan for increased costs. Second, while the percentage has been the same and is, admittedly high, it doesn’t tell the whole story. Because our percentages have stayed the same, the insurance commission has increased co-pays and deductions. For example, if you have to go to a second tier hospital in our system, your costs can be as high as a $700 co-pay up to four ties in a calendar year. So it is not as if costs have stayed the same for state workers. They pay more even when the percentage contributions stay the same. I am not going to beat this horse, but in Berkshire County, if you are in Tufts Navigator, there are no first tier hospitals, so you end up paying more. If you have to take anything other than a preferred drug (for example, for some reason the generic drug doesn’t work and you have to pay for name brand), well, I pay $ 53 on a $60 prescription. For a state employee in the GIC indemnity plan, the 70-30 split would have cost $4,000 more per year. Tough to pay when one is making $50,000/yr. Even with the 80-20 split, the cost for the indemnity plan increases around $100/mo. That is tough to take as we decrease the number of employees, freeze wages, ask for furloughs, and then ask them to work harder. I wish we could have done better.

Here is the press release we have issued on the line items and areas that I worked with in the budget:

BOSLEY COMMENTS ON TOUGH BUDGET YEAR

BOSTON – With the conclusion of the House budget deliberations late Friday evening, State Representative Daniel E. Bosley (D – North Adams) commented on the amended FY 2010 proposed spending plan, saying; “This has been a very tough budget process. With a predicted $3.6 billion dollar deficit, many programs were cut or not included at all in this House budget. In recognition of the dire fiscal situation the state and nation are facing, my budget priorities this year reflected services that, in times like these, become heavily relied upon.”

To offset the deficit and to preserve local aid, the House voted to increase the sales tax by 1.25%. The vote keeps the exemption on key household items, such as food, clothing and home heating oil, which have never been taxed. It also eliminates the need for burdensome taxes on gas, alcohol and sugar. The estimates revenues from this are projected around $900 million, which will supplement the original local aid projections, as well as allow funding for other vital programs implemented across the Commonwealth.

Earlier in the week, the House passed an amendment to restore $205 million in local aid to cities and towns and a 6.65% increase from the original projections for the First Berkshire District. The recalculated projected Chapter 70 (local aid) funding, which includes funds from the American Recovery and Reinvestment Act (ARRA) for Rep. Bosley’s district are as follows:

Adams - 2,269,459
Charlemont - 325,522
Clarksburg - 2,241,267
Florida - 617,512
Hawley - 67,594
Heath - 87,779
Monroe - 109,266
North Adams - 19,118,020
Rowe - 79,485
Savoy - 654,064
Williamstown - 1,967,845

While the FY 2010 Budget adopted by the House for higher education does reduce state funding for our public higher education institutions by approximately $156.8 million (16%) from FY 2009 levels, the federal funds provided through the American Recovery and Reinvestment Act, when coupled with the state appropriations we provided in the House Budget, will bring funding for our public higher education institutions back to their FY 2009 levels. Massachusetts College of Liberal Arts was funded at $14,372,730 and of that amount, a total of $350,000 is for the Berkshire Wireless Learning Initiative, and of that, $100,000 is allocated for the Berkshire Compact, which assesses and evaluates the higher education resources available to Berkshire County residents.

Through a language change in a Medicaid line item, championed by Representative Bosley, North Adams Regional Hospital was able to prevent cuts of approximately $3 million to their budget. This boost of funding, won on the floor, is particularly important considering that the Hospital has already made $4.5 million in cuts to their budget from last year through cutting costs, lay-offs of staff, and contract negotiations.

This year’s budget was not heavily laden with earmarks. As a result, earmarks within line items that Representative Bosley has typically secured are not present as earmarks; however, the majority of funding for these earmarks was preserved as a certain percentage within the overall line item. For example, the Turner House, which serves homeless and low income veterans in Williamstown and has historically been funded at $42,000, will retain seventy five percent of their funding from last year (which equates to $31,500). In addition to that, the United Veterans of America: Soldier On, which has been funded at $100,000, will also retain seventy five percent of their FY ’09 funding (amounting to $75,000).

The Northern Berkshire Community Coalition (NBCC) oversees all of Northern Berkshire’s social services, making sure that there is no grant application duplication or programs competing to offer our small constituency similar services. One of the programs, the Berkshire Youth Development Project, was funded at eighty percent of its FY ’09 funding which gives them $120,000 to continue coordinating efforts aimed at youth. In addition to that, $200,000 was secured for the Massachusetts Model Community Coalitions, of which the NBCC will receive $50,000. According to Rep. Bosley, “in this low economic period, our community coalitions can mobilize our communities to advocate about those services that are most critically needed, ensuring that our constituents talk with each other in finding ways to coordinate, collaborate, and maximize those resources that are left. Dollar for dollar this program is, in my opinion, one of the best in the Commonwealth. For every dollar the State puts into this, $33 is generated in community projects and programs.”

Representative Bosley also sponsored an amendment, which the House passed, to clarify language in the dairy farm tax credit from last session. The 90% refundable tax credit allows farmers to take a credit when the federal milk marketing order price for the applicable market drops below a trigger price established by the Commissioner of Agricultural Resources. The Department of Agriculture is charged with developing regulations to ensure that the cost of the tax credit to the state range from zero when milk prices are sufficient to cover Massachusetts farmers’ production expenses to no more than $4 million. The technical correction ensures that farmers will have $4 million available for assistance each year.

The 15 Regional Transit Authorities across the Commonwealth received an $8.2 million increase in funding from the originally proposed budget for a total of $54,993,971. This funding would ensure that proposed service reductions that threaten to affect consistent transportation and will allow RTAs to provide quality, reliable and cost-effective service for seniors, workers, the disabled and the general public.

The budget also included language that allocates $1,000,000 for a grant application process to offset deficits incurred at highway information centers on state highways and federally-assisted highways, including the Adams Visitor Center. “In tough economic times, keeping the Adams Visitor Center functioning as fully as possible will help the Berkshires maintain the vital tourism industry and allow it to continue flourishing”, said Bosley.

In addition to those achievements, Representative Bosley and the other members of the Berkshire delegation – Representative Smitty Pignatelli (D-Lenox), Representative Denis Guyer (D-Dalton) and Representative Chris Speranzo (D-Pittsfield) were able to secure funding for the following local and statewide programs that directly affect the Berkshires:

• $150,000 for the Western MA Enterprise Fund to provide workforce training in Western MA
• $9,383,215 for Berkshire Community College
• $50,521,840 for regional school transportation, 72% of the FY’09 total allocation
• $150,000 for the Bay State Games, which is crucial funding for the annual events held in Williamstown and North Berkshire County
• $50,000 for the Senior Farm Share Program
• Local police departments will receive 25% of their FY ’08 Community Policing grant awards

This bill, the House budget proposal, engrossed in the House, will now be sent to the Senate for consideration and debate. Once the Senate engrosses its version of the budget document, a conference committee will work out the differences between the two versions for final enactment. The bill will then be sent to the Governor.