Baker says he’s leaving state in good shape financially

Signs budget with 9.3% spending increase, vetoes $475,000

GOV. CHARLIE BAKER on Thursday signed into law a $52.7 billion state budget for fiscal 2023, representing an unusually high 9.3 percent growth in spending over the prior year. 

The high growth was fueled by tax revenues coming in higher than expected and an influx in federal COVID recovery money. The budget includes higher spending in areas like local aid, housing, and education. It sets aside $315 million for tax breaks, which lawmakers are expected to approve in an economic development bill, the final version of which is still being negotiated.  

Baker, at a signing ceremony in his State House office, touted the fiscal progress the state has made since he took office in 2015. This is Baker’s last budget before he leaves office in January. “The past seven years, we’ve always spent less than we raised in taxes,” Baker said. “That’s made a big difference in getting our budget structurally balanced.” 

Baker touted the strong fiscal situation he is leaving for his successor. Baker said the state has moved “out of a structural deficit and with a very small rainy day fund” to “the point where we’re very structurally balanced, we have a very significant rainy day fund, and based on the performance of the economy and tax collections, we do believe there will be a significant return to the taxpayers…sometime later this year.” Under the fiscal 2023 budget, the rainy day fund would reach a record $8.4 billion by the end of the fiscal year.  

This budget includes $1 billion in one-time expenditures, like an increase in funding for MBTA safety initiatives, an extra deposit into the pension system, pandemic recovery spending, and funding for pilot programs and reserve accounts. “We believe it’s affordable. We believe it’s appropriate given the time we’re in,” Baker said.  

Baker signed the budget 28 days into the 2023 fiscal year, making Massachusetts the last state in the country to have a signed full-year budget.  

Debate over the budget will continue through the weekend, as lawmakers consider whether to override the governor’s $475,000 in vetoed spending and whether to pass some significant policy amendments that Baker returned to them before the legislative session ends Sunday. 

With the state awash in cash, lawmakers had an opportunity to invest in myriad new and expanded programs. Baker signed a $110 million provision extending for one year universal free meals for all students in school regardless of income. There is a $266 million expenditure for the MBTA to address safety problems. Local aid increased to $1.231 billion, an increase of $63.1 million over the prior year. The Student Opportunity Act’s revamped education funding formula is fully funded, giving schools $5.998 billion in Chapter 70 aid, an increase of $651.8 million over last year. 

The budget puts $250 million toward continuing a grant program to stabilize early education providers through December, while also increasing subsidies that pay childcare tuition for low-income families. College scholarship funding will be expanded, as will various business development programs. 

With soaring housing prices, the budget invests a record $885 million in housing assistance, including popular rental assistance programs that were dramatically expanded during the pandemic and emergency shelters. 

The budget expands the Medicare Savings Program to help more low-income seniors reduce their health care spending. There is increased funding for substance use disorder treatment, the mental health system, a new community living center at the Chelsea Soldiers’ home, and two new classes of State Police recruits. 

The bill eliminates all probation and parole fees, an attempt to help people released from prison gain their financial footing as they reintegrate into the community. 

The bill also bans child marriage in Massachusetts, making it illegal for anyone under age 18 to get married. Advocates see the policy move as a child protection measure to prevent children from being coerced into marriage, particularly at an age when they are legally too young to file for divorce or enter a domestic violence shelter.  

The spending Baker vetoed included some local earmarks. He vetoed a $200,000 line item requiring the Department of Environmental Protection to develop a program for recycling car seats. He vetoed $125,000 for the Disability Law Center to monitor conditions at Bridgewater State Hospital. The Disability Law Center has been a strong critic of how the administration is managing the state facility for incarcerated people with mental illness.  

It takes a two-thirds vote to override Baker’s spending vetoes, which the Democratic-controlled Legislature can almost always get.  

The budget was also heavy on policy. The governor signed 153 “outside sections,” which are policy-related rather than direct spending, but returned 41 to the Legislature with proposed amendments. Lawmakers can either pass his amendments and send them back to Baker or pass their original language again. By passing a budget so late, lawmakers ceded power to Baker since if they pass their original language and he vetoes it, after Sunday, lawmakers will no longer be in session to override the veto. 

Most notably among his amendments, Baker has been pressing lawmakers to reach a compromise on his bill that would expand the circumstances under which a judge can order a defendant held pre-trial because they are considered dangerous. The budget included $20 million with a requirement correction officials give free phone calls to all prison inmates. The governor returned that section with an amendment that includes provisions of his dangerousness bill.  

Another amendment relates to plans to expand who is eligible for subsidized insurance through the state Health Connector. Lawmakers agreed to a two-year pilot program that would expand eligibility for ConnectorCare to individuals earning less than 500 percent of the federal poverty level, about $68,000 a year for an individual, making an estimated 37,000 more people eligible. Baker wants to require the Health Connector to study the implementation and costs before moving ahead. 

While I agree with the goal of providing individuals and families with affordable coverage options, there are significant variables and factors that need to be considered before such a pilot can be implemented,” Baker wrote in his amendment letter, pointing to the potential impact on carriers and enrollees, the availability of federal funding, and the need for Connector systems changes.  

Amy Rosenthal, executive director of Health Care For All, a health care consumer advocacy group, said in a statement, “At a time when Massachusetts residents are struggling under the weight of the rapidly rising cost of living, we are deeply disappointed that Governor Baker blocked a provision that would have helped tens of thousands of individuals and families afford their health care. We will continue to work with the Legislature to deliver badly needed relief to help people see their doctors and access the health care they need.” 

Baker revived a proposal he made previously by seeking to require money from a Children and Family Legal Representation Trust Fund be spent on expanded guardian ad litem appointments in care and protection cases, giving the child whose custody is at stake their own advocate.  

Baker amended a requirement that the administration create a common portal people can use to apply for different types of state benefits to exclude veterans’ benefits, since they are not administered by the state. Indicating the administration’s support for the broader concept, the Executive Office of Health and Human Services announced Thursday that the state has released a common application where someone can apply for MassHealth and food assistance simultaneously. 

The Legislature passed a provision allowing people to supplement the state’s paid family and medical leave program with accrued sick and vacation time to increase their earnings while on leave. Baker vetoed the measure  because of the heavy administrative burden on employers and the potential cost to the state program if more people use it. 

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Shira Schoenberg

Reporter, CommonWealth

About Shira Schoenberg

Shira Schoenberg is a reporter at CommonWealth magazine. Shira previously worked for more than seven years at the Springfield Republican/MassLive.com where she covered state politics and elections, covering topics as diverse as the launch of the legal marijuana industry, problems with the state's foster care system and the elections of U.S. Sen. Elizabeth Warren and Gov. Charlie Baker. Shira won the Massachusetts Bar Association's 2018 award for Excellence in Legal Journalism and has had several stories win awards from the New England Newspaper and Press Association. Shira covered the 2012 New Hampshire presidential primary for the Boston Globe. Before that, she worked for the Concord (N.H.) Monitor, where she wrote about state government, City Hall and Barack Obama's 2008 New Hampshire primary campaign. Shira holds a master's degree from Columbia University's Graduate School of Journalism.

About Shira Schoenberg

Shira Schoenberg is a reporter at CommonWealth magazine. Shira previously worked for more than seven years at the Springfield Republican/MassLive.com where she covered state politics and elections, covering topics as diverse as the launch of the legal marijuana industry, problems with the state's foster care system and the elections of U.S. Sen. Elizabeth Warren and Gov. Charlie Baker. Shira won the Massachusetts Bar Association's 2018 award for Excellence in Legal Journalism and has had several stories win awards from the New England Newspaper and Press Association. Shira covered the 2012 New Hampshire presidential primary for the Boston Globe. Before that, she worked for the Concord (N.H.) Monitor, where she wrote about state government, City Hall and Barack Obama's 2008 New Hampshire primary campaign. Shira holds a master's degree from Columbia University's Graduate School of Journalism.

Baker vetoed some reporting requirements imposed on his administration. Other amendments he filed related to policies on the collection of racial and ethnic demographic data; a proposed licensing scheme for quarries producing concrete aggregate; protocols for treating stroke patients; adjustments to state energy conservation and environment programs; adding members to the state retirement board and the MBTA board; expanding the availability of HIV treatment for minors; and authorizing higher Social Security payments for some municipal retirees; among others. 

Correction: This story has been corrected to note that the budget includes $1 billion in one-time expenditures, not one-time revenues.