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Our State Budget: Building a Better Future Together

Our State Budget: Building a Better Future Together. Massachusetts Budget and Policy Center 15 Court Square, Suite 700, Boston, MA 02108 617.426.1228 www.massbudget.org. Education. Transportation. Libraries, Parks and Recreation. Public Safety . Clean Air and Safe Drinking Water .

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Our State Budget: Building a Better Future Together

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  1. Our State Budget: Building a Better Future Together Massachusetts Budget and Policy Center 15 Court Square, Suite 700, Boston, MA 02108 617.426.1228 www.massbudget.org

  2. Education

  3. Transportation

  4. Libraries, Parks and Recreation

  5. Public Safety

  6. Clean Air and Safe Drinking Water

  7. Prisons and the Courts

  8. Health Care and Public Health

  9. Human Services

  10. How Much of our Income Does it Take?

  11. Mass. Taxes are Lower than U.S. Average US 10.4% MA 9.8%

  12. Why We are Called “Taxachusetts” State and local taxes as % of personal income, Fiscal Year 1977 MA 13.8% US 11.4%

  13. Mass. Taxes Declined Most: 1977- 2009 US 8.1% Decrease MA 29.2% Decrease

  14. State Spending Declined Somewhat Local Aid Law & Pub. Safety. Econ. Dev. & Infrastructure Env. & Rec.

  15. State Tax Revenues Declined ~$3 Billion 6.3% 5.3% Corporate Tax (-$332 million)

  16. Revenue Plunges in FY09 as Recession Hits *Final collection total (from Auditor’s revenue report) includes only those tax categories counted in the official Consensus Revenue Estimate.

  17. Closing the Budget Gaps: FY10-FY12 Total Gap: $5 billion Billions Total Gap: $2.7 billion Total Gap: $1.9 billion

  18. How big is the fiscal year 2013 budget gap? Rough Calculations 550 million – 266 million + 1.01 billion = 1.29 billion one-time FY12 FY13 revenue growth cost growth Projected Deficit revenue not available (inflation) for FY13 This estimate uses DOR revenue estimates, MassBudget spending estimates $2.23 billion

  19. How does the Governor fill a $1.3 billion gap for FY 2013? • Rainy Day Fund: $400 mil • Proceeds from various trust funds • Cigarette tax up $0.50: $63 mil • Sales tax for candy and soda: $62 mil • Enhanced tax enforcement: $22 mil • Bottle redemption: $22 mil

  20. Chapter 70 Education Aid • Gov’s FY13 Proposal Notes: • CH70 up $145.6 mil, but somewhat less when considering federal Ed. Jobs money Billions, Inflation Adjusted Includes ARRA funding; Adjusted using the inflation factor identified in Chapter 70

  21. Local Aid • Gov’s FY13 Proposal Notes: • Unrestricted General Gov’t Aid cut of $65 million could be reversed with sufficient FY12 surplus funds Billions, Inflation Adjusted

  22. Early Education and Care • Gov’s FY13 Proposal Notes: • Child Care subsidies cut $8.1 million Millions, Inflation Adjusted

  23. Higher Education • Gov’s FY13 Proposal Notes: • Major Community College governance changes coupled with increase of $14.4 million Billions, Inflation Adjusted

  24. Public Health • Gov’s FY13 Proposal Notes: • Sales tax revenue from soda and candy used to fend off deeper public health cuts Millions, Inflation Adjusted

  25. Human Services Billions, Inflation Adjusted

  26. Mental Health 15% decrease since FY01 But some costs shifted Millions, Inflation Adjusted

  27. Environment and Recreation Millions, Inflation Adjusted 20% decrease since FY01

  28. Investing in a strong state economy

  29. No clear relationship between tax levels and wages

  30. Strong relationship between education and wages

  31. Weaker relationship between education and wages 30 years ago

  32. Economic Development Tax Expenditures

  33. Many Program Areas Have Seen Substantial Cuts Over The Last Ten Years What We Do Together Through Government

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