$5.26 Billion Budgeted; Cities and Towns Held Harmless Despite Revenue Shortfall
BOSTON—State Representative Barbara L’Italien joined her colleagues in the House of Representatives to pass an early local aid resolution that will increase state aid to cities and towns in the FY09 budget by $223 million. The resolution was agreed to by House and Senate budget writers and is expected to be debated in the Senate soon.
The resolution provides an increase in local aid representing a 4.43 percent hike over last year and includes the three major categories of local aid – Chapter 70 funding for public schools, lottery aid and additional assistance. Passage of a local aid resolution nearly four months before the start of the fiscal year will help North Andover craft its municipal budget with greater confidence and accuracy. It guarantees that North Andover will receive $5,551,977 in Chapter 70 educational aid, $120,549 in Additional Assistance funding and $2,430,070 in Lottery Distribution for a total of $8,102,596 in Fiscal Year 2009.
“Passage of this resolution nearly two months before we even debate the budget is a clear sign that the House has put addressing the needs of cities and towns high on the agenda,” stated Rep. L’Italien. “Despite a tough fiscal climate our support for local aid remains and we have provided a sustainable increase at a time when many other parts of the budget may see reductions.”
“Cities and towns need our help and, once again, the Legislature is increasing the two most critical needs of municipalities – schools and local aid,” Speaker DiMasi said. “While this difficult budget year demands cuts, efficiencies and wise spending throughout state government, I am pleased that this agreement ensures every community in the Commonwealth will see an increase in local aid based on dependable forms of revenue.”
“Rep. L’Italien has joined with us today in ensuring the Bay State’s cities and towns are protected even in these times of fiscal difficulty and uncertainty. Our resolve to help cities and towns has never been stronger and we demonstrate that local aid is a top priority year after year by giving municipalities billions of state dollars to help pay for basic local services,” said Representative Robert A. DeLeo, chairman of the House Committee on Ways and Means.
The resolution guarantees cities and towns will receive $935 million in unrestricted local aid, $811 million of which is generated by the Massachusetts Lottery and $124 million of which is allocated from the Commonwealth’s General Fund. Since the Lottery was “uncapped” by the Legislature in Fiscal Year 2007, all revenue other than prize money and a small amount for administration goes to municipalities.
In FY09, however, only $811 million is projected to be generated—$124 million less than was allocated last year. The Legislature’s budget will ensure the additional $124 million is distributed and that cities and towns are held harmless to last year’s allotment.
The local aid resolution also maintains a commitment made by the Legislature three years ago by increasing Chapter 70 allocations by $223 million to $3.95 billion. The increase comes as part of a five year plan to move individual school districts toward their target-aid contribution level. Under the Legislature’s plan, each school district would see an increase in Chapter 70 funding over last year.
