Continuing an annual tradition: The late state budget
Baker signs interim budget for July
IT MAY BE an unusual year, but one annual Beacon Hill tradition is continuing: getting the state budget done late.
July 1 marks the start of the 2022 fiscal year, but a final budget bill is nowhere in sight.
Last year, amid COVID-19-related economic uncertainty, lawmakers intentionally delayed passing a budget for months as they waited to see what would happen with the economy and with congressional stimulus bills. This year, however, lawmakers pursued a more normal path. The House and Senate have both passed their versions of the budget, and the two bills are sitting with a six-member conference committee.
On Monday, lawmakers passed a temporary budget to keep government funded for a month while they continue to haggle over details of the annual budget. Gov. Charlie Baker quickly signed it. According to the State House News Service, Sen. Cindy Friedman, vice chair of the Senate Ways and Means Committee, called passage of the interim budget “standard procedure.”
The Massachusetts Taxpayers Foundation analysis suggests that the biggest issue may be figuring out how to deal with the extra money. The budget is based on certain revenue assumptions, many of which have since changed. The business-backed foundation estimates that lawmakers will have at least $3.8 billion more to spend than was assumed in January.
Both the House and Senate counted on taking money from the rainy day fund, so some extra money could go toward restoring that. It could let budget-writers fund both House and Senate earmarks and spending priorities. MTF recommends setting aside money to use alongside an influx of federal funds, which are expected to be allocated through a separate budget process. (After a brief dispute with lawmakers, Baker signed a bill Monday giving the Legislature authority to determine how to spend that money through the normal legislative process, while laying out, again, his own proposal for how to spend more than half of it.)
But beyond any significant policy debates, lawmakers may simply be continuing their now-regular tradition of using time as a negotiating tactic and failing to come to an agreement until absolutely necessary. In 2018, Baker signed the budget July 26, making Massachusetts the last state in the country to have a budget. In 2019, Baker signed the budget July 31. In October 2019, the state comptroller was warning lawmakers that the state would lose money if they waited too long to pass a supplemental budget to close out the books on the last fiscal year.According to the National Conference on State Legislatures, as of June 23, 32 states had already enacted their fiscal 2022 budgets, while another four states had budgets on their governors’ desks. Five states either had two-year budgets in place or have fiscal years that start this fall.
Only one state – New York – failed to have a budget in place by the start of its fiscal year (which was April 1). In two days, Massachusetts will join that club.