State Budget Closes with $700 Million Deficit

October 2, 2020 Pace LaVia

Gov. Charlie Baker filed a proposed closeout budget with the Legislature Wednesday that shows the state is ending fiscal 2020 with a close to $700 million budget gap claiming that the deficit is due to the COVID-19 pandemic and resulting lower-than-anticipated sales tax revenues, deferral of business taxes, lower gaming revenue, and lower gasoline taxes.

To cover costs, Baker proposes to bridge the budget gap by diverting money from excess capital gains taxes which are currently earmarked for the state’s $3.5 billion rainy day fund, and that $108 million that was not spent in fiscal 2020 be carried over into fiscal 2021. Further, the governor proposes $424 million in new spending to cover costs incurred by the state Medicaid program.

The bill now goes to the House for consideration.

The High Cost of the Coronavirus Response

Massachusetts has spent $838 million of the $1.1 billion supplemental budget bill appropriated for combating the Covid-19 virus, according to a report released on Wednesday.

The biggest expenditure, according to the report from Secretary of Administration and Finance Michael Heffernan to the House and Senate Ways and Means Committees was $350 million for personal protective gear — slightly less than lawmakers’ earlier projection of $356 million.

The report includes a breakdown of expenditures incurred by the state:

$20 million designated by the Baker administration to “address racial disparities in health during the 2019 coronavirus pandemic,” has yet to be released
Also, an additional $111 million meant for health providers, hospitals, and nursing home payments has yet to be released
Only $29 million of the projected $44 million budget assigned for a contract tracing program has been utilized by the state
$47 million spent on field hospitals by the state is considerably less than the anticipated $85 million

Other Local Aid

The supplemental budget bill also allocated funds to cities and towns in Massachusetts to aide programs with the following grants:

$846,000 for virtual learning programs
$1 million to local boards of health
$2.5 million to re-open schools
$7.2 million for food distribution
$25.7 million mostly channeled through the state’s rental assistance program, for housing programs

The remaining funds may be utilized by the state for Fiscal Year 2020, as the books have yet to be closed on the year ended June 30th.

Delve deeper at the Boston Patch.

Eviction Protection Bill Clears Housing Committee

The Joint Committee on Housing has cleared a path for an eviction protection bill just 18 days before the state’s eviction ban is set to expire. The bill’s authors seek to extend the current eviction moratorium. Should the bill pass, rent increases would be frozen until one year after the official end of the state of emergency.

According to the report in Commonwealth Magazine, all 14 Democrats on the panel voted to advance the bill while Republican Reps. David DeCoste and Will Crocker voted no, and Republican Sen. Patrick O’Connor of Weymouth abstained.

Several changes were made to the initial draft that was filed at the end of June including an allowance for landlords to apply for a tax credit from the state that would be equal to the amount of rent owed. In order to receive the credit, landlords would have to forgive the debt of tenants who can’t pay because of COVID-19–related financial hardship.

Moreover, the bill would allow landlords with fewer than 15 units to pause mortgage payments for up to six months. Those payments would then be added to the end of their loan.

Also, under the bill, eligibility for the Residential Assistance for Families in Transition program would be expanded to make low-income households that would be eligible to receive up to $10,000 to be used to pay rent.

Revised Ridership Estimates Put Federal Funding of East-West Rail Service In Jeopardy

A recent presentation to the East-West Passenger Rail Study Advisory Committee has revealed more details about the project. Consultants for MassDOT stressed in the presentation that the latest estimates of ridership might put required federal funding at risk at only about one-tenth of the level required to be considered “competitive.”

Ethan Britland, the study’s project manager had this to say:

“Federal funding rules say that a (benefit-cost analysis) of 1.0 or higher makes it more competitive for federal funding, so we’re only at about 10 percent. As we all know, these are very expensive cost estimates, so federal participation, we feel, is key for any future project development that may happen. But with BCAs this low, it would be challenging for federal competition.”

And Kimberly Robinson, executive director of the Pioneer Valley Planning Commission stated:

“It is imperative that we look at the economic benefits of this type of infrastructure development. It is key to really understanding the full picture, because what we’re building, I believe, is opportunity and opportunities in many different ways.”

New projections suggest that passenger rail expansion into Palmer, Springfield, Chester and Pittsfield Massachusetts would attract 278,000 to 469,000 riders per year at a cost ranging between $2.4 billion and $4.6 billion.

Currently, the MBTA does not offer rail service west of Worcester. However, existing tracks currently carry freight and Amtrak trains all the way to Chicago.

The project team will submit a draft report summarizing its findings and the advisory committee’s recommendations Oct. 16. The document will then be released for a 30-day public comment period.

‘Cultivating Talent’ Cannabis Industry Job Fair

On Oct, 9th from 2-4:30 pm, the “Cultivating Talent” job fair, aimed at those seeking employment in the cannabis industry will be held outdoors at Cambridge’s Starlight Square.

Employment opportunities include patient services, customer service, cultivation, security, logistics, retail, and quality assurance.

Attendees must be at least 21 years old, wear face masks and maintain a 6-foot distance from others. Do NOT attend if feeling ill. Capacity will be monitored.

Interested parties may register online. Resumes are preferable, but not required.

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