Closed door budget talks drag into state’s new fiscal year
BOSTON (AP) — There were no fiscal fireworks coming from the Massachusetts Statehouse this past week as a deadline for producing a new state budget passed quietly without eliciting much, if any, concern from state leaders.
A six-member legislative conference committee led by Senate Ways and Means Chairman Michael Rodrigues and House Ways and Means Chairman Aaron Michlewitz is working to settle disagreements between the two chambers over a $42.7 billion spending plan for the 12-month period that started July 1.
Meanwhile state government is operating on a stopgap budget.
The scenario is a familiar one on Beacon Hill where annual budgets often arrive on the governor’s desk days or even weeks into the new fiscal year.
A year after being the last U.S. state to enact a budget, Massachusetts has now joined Ohio as the only states where lawmakers have yet to ship a spending plan for the current fiscal year to their respective governors.
The conference committee voted June 5 to meet privately and has been silent ever since, making it difficult to get a read on the most troublesome issues for negotiators, but here are some candidates:
There is general agreement among the Democratic-controlled Legislature and Republican Gov. Charlie Baker that controlling drug prices is a critical step toward reining in overall costs in the state’s Medicaid program, by far the single largest line item in the state budget.
The budget proposes a mechanism by which the state could negotiate prices of the most expensive prescription drugs and, if necessary, refer pricing disputes to the state’s Health Policy Commission for public hearings. But there are key differences in the language adopted in the House and Senate plans, including a Senate provision that would allow the attorney general to intervene if the cost of a particular drug was deemed unreasonable.
The dispute is generating considerable attention in part because of the state’s standing as a hotbed of biomedical research and innovation, and the estimated 300,000 jobs supported by it. The Massachusetts Biotechnology Council opposes price controls but the industry group has made clear it prefers the somewhat milder House approach to that of the Senate.
The Senate’s budget plan includes two new taxes, originally proposed by Baker, one targeting the manufacturers of opioid medications and the other imposing an excise on e-cigarettes and vaping materials.
Neither of the proposed taxes, which would generate relatively modest amounts of revenue for the state, appear in the House’s version of the budget. Speaker Robert DeLeo hasn’t stated any opposition to the taxes, but has publicly declared his desire to wait until later this year for a broader discussion of all revenue options, including potential new sources of funding for the beleaguered Boston-area public transit system.
FREEZE OR NO FREEZE?
The House and Senate spending plans contain $558 million in state funding for the University of Massachusetts, a 7% boost from last year.
The only difference — and it’s a weighty one — is that the Senate has also voted to freeze tuition and fees in the five-campus system at last year’s levels, meaning those student costs would not go up for the coming academic year.
UMass President Martin Meehan strongly opposes the freeze and has urged Senate leaders to back off that demand, something they so far have not shown a willingness to do. Meehan says the freeze could trigger $22 million in university budget cuts absent a corresponding increase in state funding.
The final budget will almost certainly include a sizeable boost in funding for public schools with the specific goal of helping economically disadvantaged children catch up academically with those from more affluent areas of the state.
The Senate proposed a $268 million increase in so-called Chapter 70 funds that are distributed to public school districts, while the House called for a $218 million hike in Chapter 70 along with a $16.5 million reserve fund for low-income students.
Yet whatever finally emerges from the conference committee would likely be but a prelude to a more expansive debate among lawmakers over how to reform the state’s current education funding formula. A special commission in 2015 concluded that the formula, dating to 1983, shortchanges students from low-income districts, as well as students with special needs and those who are learning the English language.
Consensus on how to remedy the formula has eluded lawmakers in recent years, but Democratic leaders have expressed confidence they can break the deadlock in the current legislative session.