Patrick to Propose Current State Budget Cuts

Patrick to Propose Current State Budget Cuts

FY 15 ALTR Budget Issue Still on Table

While Governor Deval Patrick is working to fix this year's budget problem caused by an approaching drop from 5.2% to 5.15% in state income tax, both he and Governor-Elect Charlie Baker will still be tasked with proposing and funding a $46 million shortfall in the FY 15 DDS Residential Line Item related to the April 2014 roll out of Chapter 257 rates.

According to high ranking EOHHS officials, the Executive Office of Administration and Finance has recorded the $46 million as a deficiency and thus a required obligation on behalf of the Commonwealth which must be funded in a forth coming supplemental budget request.

ADDP has been urging the Patrick Administration to request; and the Legislature to fund this supplemental request before the new Governor takes office.

ADDP was told that the A&F action obligated the state, and that the supplemental could be passed before the new Governor is seated or after January 2015.

ADDP will be following up with A&F, EOHHS and the incoming and outgoing Governors to ensure that these funds will be provided as promised.

During the 2014 campaign for Governor, Governor-Elect Charlie Baker made a point of publicly committing to full implementation and payment of Chapter 257 obligations.

PATRICK ADMIN DRAFTING STATE BUDGET FIX PLAN

By Matt Murphy
STATE HOUSE NEWS SERVICE

STATE HOUSE, BOSTON, NOV. 6, 2014....Gov. Deval Patrick in the next two weeks will present a plan to trim $325 million in spending from the $36.5 billion state budget.

Two days after the election, Patrick administration officials on Thursday held a briefing to disclose the gap, which they say is forming in part due to the likelihood of a legally required reduction in the income tax rate in January from 5.2 percent to 5.15 percent.

In mid-October, Patrick's team stuck by its fiscal 2015 revenue estimate while flagging areas where the state faced revenue exposures.

Administration officials said Thursday their plan would also address a projected $175 million shortfall in non-tax revenues, such as fees.

Secretary of Administration and Finance Glen Shor briefed the media on the plans two days after voters affirmed the state's commitment to expanded gambling, protecting $95 million in assumed revenue from casinos for the current budget.

Patrick has about two months left in office. Voters on Tuesday elected Republican Charlie Baker, a former secretary of administration and finance under former Gov. William Weld, to succeed Patrick. Shor said the budget gap should be solved before Baker takes charge in January.

Shor said the administration does not plan to propose a draw from the rainy day fund to fill the budget shortfall, which was attributed to the assumed loss of $70 million in income taxes, the projected $175 million shortfall in non-tax revenues, and $80 million in costs associated with an economic development law approved over the summer.

Though tax revenues through October are currently trending $32 million below benchmarks for the year, Shor said budget analysts believe taxes would have met the benchmarks assumed in the state's $36.5 billion budget for fiscal 2015 if not for the income tax reduction.