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Substantial Budget Shortfalls Predicted for Next Year

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Even with better-than-expected revenue during the past three months, economists are warning Massachusetts lawmakers that tax collections could fall below projections by as much as 12 percent for this fiscal year ending July 1, 2021. 

According to Revenue Commissioner Geoffrey Snyder, tax collections are expected to fall between $1.2 billion and $3.6 billion below projections. Moreover, those figures are based on lowered projections made after the coronavirus crisis started. 

Snyder's and other economists presented their projections at a hearing this past Wednesday. 

Compounding the problem is the fact that Mass. unemployment currently remains among the highest in the nation at 11.2 percent. 

As Eileen McAnneny, president of the business-backed Massachusetts Taxpayers Foundation pointed out, most of those gains realized so far this fiscal year have come from federal aid including the expanded unemployment benefits to the tune of $15.8 billion.

To help close the gap, President of Massachusetts Budget and Policy Center, Marie-Frances Rivera, along with a coalition of Mass. workers’ unions are imploring lawmakers to raise taxes on the state's wealthiest residents.  

Patch.com has more on this story.

Tight Budgets Expected to Put a Drag on Commuters

In the wake of revenue shortfalls, commuters in Massachusetts can expect increased fares, reductions in services, and slowed pace of repairs to the state’s transportation infrastructure. 

Like many agencies across the country, the MBTA is experiencing lower than expected fare revenue as a result of the pandemic. While ridership levels are slowly increasing, the agency expects continued uncertainty. 

The Massachusetts Bay Transportation Authority is considering a number of budget cuts including reducing and potentially eliminating some services after seeing a decline in ridership of up 95%.

Despite the fact that the MBTA has received more than $800 million as part of the CARES Act, the agency has been unable to balance its 2020 budget. The agency is estimating a budget deficit between $308 and $577 million for the 2022 fiscal year (which begins next October). 

A fare cap was instituted in 2016 by Gov. Charlie Baker that limits fare hikes to no more than 7 percent in a two-year period. Fares were increased in 2019 and cannot be raised again until 2021. 

Some of the proposed cuts include:

  • Ending subway service at midnight

  • Reducing train frequency

  • Eliminating commuter rail service on weekends and after 9 p.m. on weekdays

  • Eliminating some “non-essential” bus routes

Meanwhile,  according to data from the Massachusetts Department of Transportation, toll revenue has also declined by roughly one-third during the pandemic putting at risk repairs to the state’s roadways and infrastructure projects including repairs to the Tobin Bridge, highway system tunnels in Boston, and maintenance on I-90.

Here are some facts and figures as reported by MassLive.com.

  • For the first eight months of 2019 MassDOT brought in roughly $245 million in revenue. 

  • Toll revenue during the first eight months of 2020 is down approximately $80 million, to $163 million as of August.

  • Revenue from the Western Turnpike dropped to $60 million for  January 2020 to August 2020 compared to $92 million for the same period last year.

  • State highway extension and the tunnel system toll revenue totaled $129.6 million between January and August 2019. That number fell to $77.3 million during the first eight months of 2020.

  • Toll revenue on the Tobin Bridge of $24.3 million between January and August 2019 fell to $17.3 million for the same period in 2020.

  • In March, trips on the Massachusetts Turnpike, the tunnel system and the Tobin Bridge combined were down to fewer than a million a day compared to 1.5 million per day prior to the pandemic.

Learn more at the Daily Free Press, MassLive.com, and Mass Transit Magazine.

Curaleaf Receives CCC Approval for Acquisition of Alternative Therapies Group

The Massachusetts Cannabis Control Commission has approved Curaleaf Holdings, Inc.’s acquisition of Alternative Therapies Group.

Curaleaf is one of the leading vertically integrated cannabis operations in the country.

Joseph Lusardi, Chief Executive Officer of Curaleaf, said in a statement:

"We appreciate the work of the Commission, and we are pleased to have secured the final regulatory approval for our acquisition of ATG's Amesbury cultivation and manufacturing licenses and facility, paving the way for a successful completion of the transaction, and we thank the Commission. As we look ahead, the integration of ATG's cultivation and processing facility will expand our cannabis grow capacity in Massachusetts by 60%, allowing us to better address the rising demand we continue to see among medical and adult-use customers as well as expand Curaleaf's wholesale market presence. Overall, these enhanced production capabilities will provide a powerful growth engine for our business in 2021 and beyond as new harvests come online."

ATG operates a 53,600 square foot cultivation and processing facility in Amesbury, Massachusetts with dispensaries located in Amesbury, Salisbury, and Salem. Curaleaf also operates dispensaries in Provincetown and Ware, as well as a co-located medical and adult-use dispensary in Oxford, and a medical dispensary in Hanover. 

Read the company press release here.

Business is Still Booming For Cannabis

The Massachusetts marijuana industry has generated $273 million in sales since reopening roughly four months ago, after a short closure due to pandemic-related restrictions. And according to data from the Cannabis Control Commission, more than the $217 million in sales were generated in the four months prior to the shutdown. 

The WBUR website has more on this story.

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