Healey files a ‘unicorn’ of a state budget

Proposal cuts taxes, sets money aside, and boosts spending to record levels

GOV. MAURA HEALEY unveiled a state budget package on Wednesday that cuts taxes by nearly $1 billion, socks money away for a rainy day, and pours record amounts of funds into many key initiatives.

The $55.5 billion budget proposal represents a 4.1 percent spending increase over the current year, and 14 percent higher than the initial budget proposal filed by her predecessor for the current year.

It features the largest increase in local education spending in history, a 23 percent increase in funding for higher education, and a 24 percent increase in the budget of the Executive Office of Energy and Environmental Affairs.

The budget also creates a $20 million program called MassReconnect to provide free community college to students 25 years old and older. It launches a low-income fare for MBTA riders, and it frees up $20 million so inmates at the state Department of Correction can make free phone calls.

The first-term Democratic governor said her first budget “meets the moment” of trying to build a strong economy, livable communities, and a sustainable future. “We want to make the life of every Massachusetts resident better and more affordable,” she said at a State House press conference.

“There really is something for everyone in this budget,” said Lt. Gov. Kim Driscoll.

Doug Howgate, president of the business-backed Massachusetts Taxpayers Foundation, said cutting taxes, boosting spending, and socking money away is an amazing trifecta that doesn’t come around very often and makes crafting a budget a lot easier.

“You don’t normally see that unicorn,” he said. “When you get 40 percent revenue growth over a two-year period and you pass the biggest tax increase in 20 years [the millionaire tax], it makes some of those decisions a little bit easier.”

Healey in her inaugural address promised to include “funding in her first budget to hire 1,000 additional MBTA workers in the first year of her administration.” Administration officials disclosed on Wednesday that former governor Charlie Baker had already provided that funding, and Healey will now provide “hiring and training supports” in an upcoming supplemental budget to facilitate that hiring.

Healey’s budget for the first time allots 1 percent of the state budget to the Executive Office of Energy and Environmental Affairs. The agency’s budget would go up $105 million under Healey’s proposal, which will allow the hiring of 240 new staff members.

The budget of the Clean Energy Center is tripling with the infusion of $35 million. Another $4.8 million would go for a “decarbonization clearinghouse” to provide residents with a one-stop shopping for information and help with energy efficiency, electrification, and electricity storage.

Gov. Maura Healey flanked by her entire cabinet. (Photo by Bruce Mohl)

The budget also calls for the hiring of 28 full-time environmental justice employees across the various agencies within the executive office and the establishment of a environmental training program for governmental and nongovernmental agencies.

Sen. Michael Barrett of Lexington, the co-chair of the legislative committee dealing with energy and climate change issues, hailed the focus on the environment and climate. “For efforts in this area, this is the best executive branch budget I’ve ever seen. It’s a leap over anything a governor has proposed before,” Barrett said.

Healey is calling for the Department of Early Education and Child Care to receive $1.455 billion, including $475 million to support child care centers and $30 million to begin the move to universal preschool programs, starting in Gateway Cities.

At the start of the COVID pandemic, the federal government upped funding for state Medicaid programs with the condition that no one receiving coverage under the health insurance program for the poor would lose coverage unless they voluntarily withdrew, moved out of state, or died. As a result, the Medicaid rolls rose from less than 1.8 million to more than 2.3 million.

With federal funding set to expire in May, the number of people on Medicaid is starting to trend down as the eligibility of participants is checked. The Healey administration is forecasting that the number will eventually drop by about 300,000 to just under 2 million  by April 2024 and is including $5.1 million in the budget to help people transition to private health insurance. State spending on Medicaid is expected to fall from $8 billion this year to $7.9 billion in fiscal 2024.