Baker signs FY21 budget, vetoes $156m

OKs 10% welfare hike, but only for 1 year

GOV. CHARLIE BAKER signed the delayed fiscal 2021 budget on Friday, vetoing $156 million in spending.

Lawmakers had postponed passing a budget for the year that began July 1 to take time to monitor the economic impact of the COVID-19 pandemic. That left state government operating on a series of temporary budgets for the first five months of the fiscal year.

The final budget that Baker signed is $45.9 billion, representing growth of 4.5 percent over fiscal 2020.  Much of the additional spending is driven by rising MassHealth costs, with more people becoming eligible for MassHealth and a federal rule that prohibits the state from cutting anyone from MassHealth during the pandemic.

With tax collections coming in higher than expected so far this year, the administration revised upwards by $459 million the amount the state expects to collect in taxes, to $28.44 billion. That is still a $1.2 billion anticipated drop in taxes compared to fiscal 2020.

The budget is bolstered by federal stimulus money, a timing change in sales tax collections, a delay in implementing a new state charitable deduction, and a withdrawal from the state’s rainy day fund that Baker anticipates will be $1.35 billion. It makes investments in multiple areas where state residents were affected by COVID-19, such as food assistance, housing assistance, racial justice, early education, and public health.

On the spending side, the governor’s $103 million in vetoes were mostly in areas where lawmakers wanted to expand benefits or services, according to an official with the Executive Office for Administration and Finance. They span a range of agencies.

Baker did let a 10 percent increase in welfare payments for this year go through, but vetoed language that would have made the increase permanent next year.

Baker signed $80 million in local earmarks into law, generally those for one-time, targeted COVID-19-related expenses.

Baker also vetoed $53 million in one-time COVID-19 related spending for K-12 schools.

According to the Office for Administration and Finance, Baker supports spending the $53 million, but rather than distributing it according to a formula, as the Legislature’s budget envisions, he wants flexibility to target the spending to school districts with a particular focus on helping the students who fell furthest behind during the pandemic.

At the same time as he returned the budget vetoes, Baker filed a supplemental budget with the Legislature that includes the $53 million in education spending, distributed through targeted grants. The supplemental budget also includes more money for small business recovery, a community compact program, and a Peace Office Standards and Training Commission that was included in a police reform bill, which Baker also returned with an amendment.

The most controversial item in the budget was an amendment expanding abortion rights, which Baker returned with an amendment. The provision would have lowered the age at which a minor could get an abortion without parental or judicial consent and would also have expanded access to abortion when a fetus is older than 24 weeks in cases of a “lethal fetal anomaly.”

But there were several other policy changes as well.

Baker signed into law several significant policy changes as part of the budget. Large businesses will, as of April, have to remit sales tax collections on a quicker timeline. Insurers will no longer be able to charge more money for same-day behavioral health and medical services. Hemp growers will now be able to sell hemp products to marijuana dispensaries. The Registry of Motor Vehicles will begin requiring ignition interlock devices for first-time drunk drivers who are granted a hardship license.

Baker did not sign a provision that would have required the MBTA to use unanticipated revenue to restore MBTA service, but returned it with an amendment that would give him more flexibility in MBTA operations.

Baker also returned sections related to delaying eviction proceedings while someone’s rental assistance application is pending, saying he wants to bring the language more in line with court processes.

Meet the Author

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.

Lawmakers need to take a two-thirds vote to override Baker’s vetoes, and they are likely to have the numbers to do so.  The House approved the conference committee report on a 147 to 10 vote, while the Senate approved it unanimously.

It will be up to the Legislature whether to take up Baker’s supplemental budget bill.