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Post Office Box 1147 ●
Marblehead, Massachusetts 01945 ●
(781) 639-9709
“Every Tax is a Pay Cut ... A Tax Cut is a Pay Raise”
45 years as “The Voice of Massachusetts Taxpayers”
— and
their Institutional Memory — |
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CLT UPDATE
Monday, July 22, 2019
Don't
blink or you'll miss the budget's passage
|
The mercury is rising, optimism is growing
and lawmakers now have a buckeye on their back after Ohio
beat them to a two-year budget accord that Gov. Mike DeWine
inked his name to on Thursday.
So then there were four.
Massachusetts, North Carolina, New Hampshire
and Oregon are the last states in the country who started
their fiscal years on July 1 without a finalized budget in
place for fiscal 2020.
The Massachusetts House and Senate, however,
have the special distinction of being the last Legislature
to not have at least agreed amongst themselves. New
Hampshire Gov. Chris Sununu and North Carolina Gov. Roy
Cooper vetoed the respective budgets sent their way, and
Oregon Gov. Kate Brown is still working her way through the
plan she received....
"On behalf of our fellow conferees, we're
pleased to announce that the Conference Committee has made
great progress towards reaching an agreement on the FY2020
Budget. Over the weekend, the committee will complete the
work needed to finalize the agreement," Michlewitz and
Rodrigues said.
But could the damage already be done?
Baker said that apart from the uncertainty
created by the lack of full budget, he is concerned that all
the time spent waiting for a deal is crowding out other
priorities. And it does appear that the Legislature is
prepared at this point to coast into the August recess
without having tackled major issues like climate change,
education funding reform or sports betting, to name just a
few issues.
Those can all get added to the fall agenda
when DeLeo has promised a tax and transportation financing
debate that could be another all-consuming spectacle.
State House News Service
Friday, July 19, 2019
Weekly Roundup - The heat is on
Three weeks after the start of the new
fiscal year, Democratic leaders finalized a fiscal 2020
budget agreement over the weekend to end a weeks-long
stalemate and authorize $43.1 billion in state government
spending over the next year.
The deal, which is expected to be voted on
Monday by both the House and Senate, puts the state in
position to potentially have a budget in place in time for
the Legislature to avoid having to approve another stopgap
spending measure. If Gov. Charlie Baker signs it within 10
days, Massachusetts may also avert being the last state in
the country without a signed full-year budget, as it was
last year.
After negotiations that began in early June,
House and Senate leaders chose not to include new taxes on
opioid manufacturers or e-cigarettes and vaping products.
Both tax plans were initially proposed by Republican Gov.
Charlie Baker and backed by the Senate, but the House felt
they should go through the committee process.
The budget also dropped the Senate's
proposed freeze on tuition at the University of
Massachusetts next year, and did not increase funding for
the five-campus system beyond the $558 million recommended
by the governor and both branches, making a tuition hike for
students next year likely.
The bill (H 4000) does include a plan to
control pharmaceutical drug costs that closely resembles the
one that passed the House after intense lobbying by the life
sciences and biopharmaceutical industries....
The final budget's bottom line, according to
legislative officials, was boosted by optimism tied to
surging tax collections that allowed negotiators to increase
collection expectations for the the coming year by nearly
$600 million....
"It took awhile but in the middle of trying
to put all the pieces together we had this significant and
very much welcome news that revenues were just pouring in
quicker than we thought and we wanted to see if we could
accommodate," said Rodrigues, who also highlighted
investments in community colleges, public universities,
substance abuse treatment and mental health.
The revised tax estimates also led budget
negotiators to increase the assumed deposit into the "rainy
day" fund from capital gains at the end of fiscal 2020 by
$230 million, which would put the balance of that reserve
fund above $3 billion. And the School Building Authority and
the MBTA also automatically receive an additional $23
million each based on the revised revenue assumptions.
The budget bill was filed late Sunday
afternoon, days after the chief negotiators – Michlewitz and
Rodrigues – signaled Friday in a statement that they planed
to wrap up work this weekend.
Both branches planned formal sessions for
Monday in anticipation of the deal. The Legislature is the
last in the country with a fiscal year start date of July 1
to finalize a budget accord, though the governors in three
other states – New Hampshire, North Carolina and Oregon –
have still not signed a budget for fiscal 2020....
Baker will have 10 days to review the budget
from whenever it reaches his desk, and will be in Colorado
until Wednesday where he is attending the annual meetings of
the Republican Governors Association.
The other conferees – Reps. Denise Garlick
and Todd Smola and Sens. Cindy Friedman and Viriato deMacedo
– all signed the agreement.
Rodrigues said the only "new revenues" in
the budget come from enhanced enforcement of online sales
taxes and increases in registry of deeds filing fees to
support the Community Preservation Act.
State House News Service
Sunday, July 21, 2019
Drug price controls included in $43.1 Bil budget accord
Three weeks into the fiscal year,
legislative leaders on Sunday filed a compromise state
budget proposal that plows nearly $270 million more into
public school spending, increases funding to the University
of Massachusetts without freezing tuition, and spends
hundreds of millions more dollars than either the House or
Senate initially proposed.
The $43.1 billion proposal, which lawmakers
expect to pass and send to Governor Charlie Baker on Monday,
also includes compromise language aimed at curbing the cost
of prescription drugs in the state Medicaid program — a
time-consuming debate during lawmakers’ weeks-long
negotiations.
Overall, the bill tacked on $317 million
more in spending than either the House or Senate had
approved as part of its own debate in the spring, in
addition to setting aside hundreds of millions more for the
state’s reserves and $23 million more for the MBTA and
Massachusetts School Building Authority. That’s because an
expected budget surplus prompted negotiators to rely on a
rosier fiscal forecast for the current fiscal year....
Massachusetts is the only state in the
country with a fiscal year starting July 1 in which the
Legislature has yet to pass a final spending bill. State
government has not shut down because lawmakers passed a
temporary $5 billion budget in late June, but the delay in
reaching a budget deal had prompted House Speaker Robert A.
DeLeo to call on Baker to file another stopgap spending
measure.
The Boston Globe
Sunday, July 21, 2019
Deal struck on $43 billion state budget, drug price controls
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Chip Ford's CLT
Commentary
By the time
you read this the long-overdue state budget will likely
be passed in the Legislature and sitting on the
governor's desk for his signature.
After 52 days of conference committee
budget talks the white smoke rose above the State House
yesterday evening announcing a budget that's 22 days
overdue has finally been agreed upon by the six holy
Cardinals of the Conference Committee. The
Committee Cardinals compromised on the initial budget of
$42.7 Billion by generously increasing spending by
another $400 million, to $43.1 Billion. Another
classic Beacon Hill Compromise.
In the CLT
Update of July 21, 2018 ("The
budget aftermath slowly revealed"), I wrote of last
year's budget "compromise":
The
Massachusetts House wanted to spend $41.52
billion of our money next year. Those
“skinflints” in the State Senate want to spend a
mere $41.49 billion. (That’s what passes for
“fiscal conservatism” in the Bay State.)
Shortly after 10 a.m. yesterday, after
hard-fought negotiations that went weeks past
the July 1 deadline, the two sides finally
hammered out a compromise: $41.88 billion.
If
you noticed that this figure is higher than both
of the original budget numbers —
congratulations! You’re not only smarter than a
fifth grader, you’re overqualified to serve as a
state legislator in Massachusetts.
This is a classic Beacon Hill “compromise.”
The House and
Senate is supposed to vote on the conference committee
compromise budget early today, four days later than last
year's late budget. What took the past 52 days to
create in utter secrecy — a
budget document funding the entire state government for
the fiscal year that not one of the other 194
legislators will have seen until this morning, if even
then — will blast through
both chambers in the blink of an eye, rubber stamped
into passage. It will be adopted without a clue by
"The Best Legislature Money Can Buy"
— none but the six
Cardinals having any idea what it contains.
The State
House News Service noted on Friday:
Baker said
that apart from the uncertainty created by the
lack of full budget, he is concerned that all
the time spent waiting for a deal is crowding
out other priorities. And it does appear that
the Legislature is prepared at this point to
coast into the August recess without having
tackled major issues like climate change,
education funding reform or sports betting, to
name just a few issues.
Those can
all get added to the fall agenda when DeLeo has
promised a tax and transportation financing
debate that could be another all-consuming
spectacle.
Assuming, as I
do, that this is a fait accompli with the Legislature
now going through the motions, it cements the
Massachusetts Legislature's reputation as again
producing the final, last state budget in the nation.
Tied with Ohio as last until last Thursday, "The Best
Legislature Money Can Buy" held out for the title and
holds onto it.
I've been
following second-latest Ohio's progress as well as that
of Massachusetts.
Ohio's
legislature passed its two-year budget late Wednesday
and sent it on to Gov. Mike DeWine. He signed it
on Thursday.
It included a
4% reduction of Ohio's personal income tax, eliminated
the lowest two brackets (those earning less than $21,750
a year will pay no state income taxes) and restored $1.2
billion in annual tax breaks for small businesses.
Ohio's FY2020 budget just past increased spending by
4.3% to $33.9 billion; next fiscal year will rise to
$35.9 billion. Ohio is done with state budgets
until 2021.
The Columbus (Ohio)
Dispatch
Thursday, July 18, 2019
Ohioans will get 4% tax cut, business breaks
remain in new budget bill
The Columbus (Ohio)
Dispatch
Thursday, July 18, 2019
Gov. Mike DeWine signs budget but vetoes PBM
changes
The (Youngstown, Ohio) Vindicator
Thursday, July 18, 2019
Gov. DeWine signs next 2-year, $69B Ohio budget,
with 25 vetoes
Kentucky's
current two-year budget was adopted last year; the next
state budget doesn't come up until January. This
was not a budget year in Kentucky (a "long session")
when its legislature is constitutionally permitted to
remain in session until no later than the end of April.
It's General Assembly, as mandated by the Kentucky the
state constitution, adjourned for this year (a "short
session") by the end of March.
According to
the State House News Service:
Baker said
that apart from the uncertainty created by the
lack of full budget, he is concerned that all
the time spent waiting for a deal is crowding
out other priorities. And it does appear that
the Legislature is prepared at this point to
coast into the August recess without having
tackled major issues like climate change,
education funding reform or sports betting, to
name just a few issues.
Those can
all get added to the fall agenda when DeLeo has
promised a tax and transportation financing
debate that could be another all-consuming
spectacle.
A
promised tax and transportation financing debate.
That's one promise you can take to the bank, something
to prepare for in the weeks and months ahead, folks.
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Chip Ford
Executive Director |
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State House News
Service
Friday, July 19, 2019
Weekly Roundup - The heat is on
Recap and analysis of the week in state
government
By Matt Murphy
The mercury is rising, optimism is growing and
lawmakers now have a buckeye on their back after
Ohio beat them to a two-year budget accord that
Gov. Mike DeWine inked his name to on Thursday.
So then there were four.
Massachusetts, North Carolina, New Hampshire and
Oregon are the last states in the country who
started their fiscal years on July 1 without a
finalized budget in place for fiscal 2020.
The Massachusetts House and Senate, however,
have the special distinction of being the last
Legislature to not have at least agreed amongst
themselves. New Hampshire Gov. Chris Sununu and
North Carolina Gov. Roy Cooper vetoed the
respective budgets sent their way, and Oregon
Gov. Kate Brown is still working her way through
the plan she received.
Gov. Charlie Baker met with House Speaker Robert
DeLeo on Thursday morning, presumably to discuss
the situation and whether another interim budget
to cover state expenses through August will be
necessary. DeLeo asked for a second interim
budget on Monday, but Baker said he's hoping to
avoid having to file one.
"I've talked to a lot of people in the
Legislature today about the budget and I'm
feeling a little more optimistic than I was on
Monday that this might all get resolved," he
said as he stepped onto an elevator.
Sure enough, the House on Friday scheduled a
formal session for Monday in anticipation of a
possible deal over the weekend. The Senate
followed suit. And then this statement from the
Ways and Means chairmen.
"On behalf of our fellow conferees, we're
pleased to announce that the Conference
Committee has made great progress towards
reaching an agreement on the FY2020 Budget. Over
the weekend, the committee will complete the
work needed to finalize the agreement,"
Michlewitz and Rodrigues said.
But could the damage already be done?
Baker said that apart from the uncertainty
created by the lack of full budget, he is
concerned that all the time spent waiting for a
deal is crowding out other priorities. And it
does appear that the Legislature is prepared at
this point to coast into the August recess
without having tackled major issues like climate
change, education funding reform or sports
betting, to name just a few issues.
Those can all get added to the fall agenda when
DeLeo has promised a tax and transportation
financing debate that could be another
all-consuming spectacle....
STORY OF THE WEEK: Planning to stay cool this
weekend as Beacon Hill waits for the white smoke
of a celebratory budget cigar.
State House News
Service
Sunday, July 21, 2019
Drug price controls included in $43.1 Bil budget
accord
By Matt Murphy
Three weeks after the start of the new fiscal
year, Democratic leaders finalized a fiscal 2020
budget agreement over the weekend to end a
weeks-long stalemate and authorize $43.1 billion
in state government spending over the next year.
The deal, which is expected to be voted on
Monday by both the House and Senate, puts the
state in position to potentially have a budget
in place in time for the Legislature to avoid
having to approve another stopgap spending
measure. If Gov. Charlie Baker signs it within
10 days, Massachusetts may also avert being the
last state in the country without a signed
full-year budget, as it was last year.
After negotiations that began in early June,
House and Senate leaders chose not to include
new taxes on opioid manufacturers or
e-cigarettes and vaping products. Both tax plans
were initially proposed by Republican Gov.
Charlie Baker and backed by the Senate, but the
House felt they should go through the committee
process.
The budget also dropped the Senate's proposed
freeze on tuition at the University of
Massachusetts next year, and did not increase
funding for the five-campus system beyond the
$558 million recommended by the governor and
both branches, making a tuition hike for
students next year likely.
The bill (H 4000) does include a plan to control
pharmaceutical drug costs that closely resembles
the one that passed the House after intense
lobbying by the life sciences and
biopharmaceutical industries.
"There were some complex issues, particularly on
the outside sections of this budget that took
some time to negotiate and some of these policy
pieces take a long time to get done, but we're
happy to finally come to an agreement on some of
these important issues that we face in the
commonwealth and get this budget to the
governor's desk," said Rep. Aaron Michlewitz,
the chair of the House Ways and Means Committee.
The drug pricing compromise authorizes the
Executive of of Health and Human Services to
negotiate supplemental rebates for MassHealth on
the most expensive drugs, but would not force
drug companies to testify before the Health
Policy Commission at a public hearing if a price
agreement can't be reached, according to
officials.
The bill does not include a process for the HPC
to refer drug companies to the attorney general
for possible prosecution under the consumer
protection laws, and leaves it up to the Baker
administration if it wants to publish a
recommended price for certain drugs.
House officials said they thought the AG
referral was "redundant," and chief Senate
budget negotiator Michael Rodrigues said the
attorney general's office made clear they do not
need a referral to bring a consumer protection
case against a drug company for unfair pricing.
Drug companies would face financial penalties,
however, if they fail to confidentially share
pricing data with the Health Policy Commission,
and Rodrigues said he thought it would "say a
lot" if manufacturers refused to appear at a
hearing and answer questions.
Michlewitz said that drug pricing was one of the
policies in the budget that took longer to
resolve, and Rodrigues called it "the most
complicated piece."
The final budget's bottom line, according to
legislative officials, was boosted by optimism
tied to surging tax collections that allowed
negotiators to increase collection expectations
for the the coming year by nearly $600 million.
Some of the money went into priorities like a
fund to help struggling nursing homes, which
will receive $50 million – the combined
recommendation of both the House and Senate. The
budget also sets up a task force to be led by
Health and Human Services Secretary Marylou
Sudders to study the nursing home industry's
challenges and report back early next year.
The conference committee also adopted the
Senate's higher recommendation for nearly $5.18
billion in Chapter 70 public school aide, an
increase of $269 million from last year.
"It took awhile but in the middle of trying to
put all the pieces together we had this
significant and very much welcome news that
revenues were just pouring in quicker than we
thought and we wanted to see if we could
accommodate," said Rodrigues, who also
highlighted investments in community colleges,
public universities, substance abuse treatment
and mental health.
The revised tax estimates also led budget
negotiators to increase the assumed deposit into
the "rainy day" fund from capital gains at the
end of fiscal 2020 by $230 million, which would
put the balance of that reserve fund above $3
billion. And the School Building Authority and
the MBTA also automatically receive an
additional $23 million each based on the revised
revenue assumptions.
The budget bill was filed late Sunday afternoon,
days after the chief negotiators – Michlewitz
and Rodrigues – signaled Friday in a statement
that they planed to wrap up work this weekend.
Both branches planned formal sessions for Monday
in anticipation of the deal. The Legislature is
the last in the country with a fiscal year start
date of July 1 to finalize a budget accord,
though the governors in three other states – New
Hampshire, North Carolina and Oregon – have
still not signed a budget for fiscal 2020.
Michlewitz and Rodrigues, both new to their
roles, said they worked well with one another
despite the length of time it took to strike a
deal.
"We had some disagreements on certain polices
but that's the nature of things," Michlewitz
said. "We both had chambers to represent in the
room and in the discussions but it never became
anything more than the typical back and forth
needed to come to common ground."
Baker will have 10 days to review the budget
from whenever it reaches his desk, and will be
in Colorado until Wednesday where he is
attending the annual meetings of the Republican
Governors Association.
The other conferees – Reps. Denise Garlick and
Todd Smola and Sens. Cindy Friedman and Viriato
deMacedo – all signed the agreement.
Rodrigues said the only "new revenues" in the
budget come from enhanced enforcement of online
sales taxes and increases in registry of deeds
filing fees to support the Community
Preservation Act.
The conferees also included a provision that
would allow the Baker administration to lift for
one year an offshore wind energy price cap that
restricts the price of power from new
procurements to no higher than in the previous
contract.
And beginning next year, UMass officials would
be required to meet with the Ways and Means and
Higher Education Committees in January to review
their financial plans to potentially avoid the
kind of public back-and-forth over funding that
occurred this year.
"It will begin the process of having better
communication between the Legislature and
UMass," Rodrigues said.
The Boston Globe
Sunday, July 21, 2019
Deal struck on $43 billion state budget, drug
price controls
By Matt Stout and Priyanka Dayal McCluskey
Three weeks into the fiscal year, legislative
leaders on Sunday filed a compromise state
budget proposal that plows nearly $270 million
more into public school spending, increases
funding to the University of Massachusetts
without freezing tuition, and spends hundreds of
millions more dollars than either the House or
Senate initially proposed.
The $43.1 billion proposal, which lawmakers
expect to pass and send to Governor Charlie
Baker on Monday, also includes compromise
language aimed at curbing the cost of
prescription drugs in the state Medicaid program
— a time-consuming debate during lawmakers’
weeks-long negotiations.
Overall, the bill tacked on $317 million more in
spending than either the House or Senate had
approved as part of its own debate in the
spring, in addition to setting aside hundreds of
millions more for the state’s reserves and $23
million more for the MBTA and Massachusetts
School Building Authority. That’s because an
expected budget surplus prompted negotiators to
rely on a rosier fiscal forecast for the current
fiscal year.
The bill also slashed plans for new taxes on
opioid manufacturers and vaping products, both
of which Baker had proposed.
As expected, the proposal puts a heavy emphasis
on beefing up school spending. It would add
$268.4 million to the state’s current
contribution to public school funding,
officially known as Chapter 70, pushing total
aid to nearly $5.18 billion. It’s the same
amount the Senate had passed in May in what
officials then called the largest one-year hike
in the last two decades.
It also includes a $39 million increase for the
University of Massachusetts system. But it drops
language the Senate passed to freeze in-state
tuition and fees, making it very likely UMass
officials will hike costs for students in the
fall. In its place, the bill requires that
university officials meet with lawmakers in
January to detail their spending.
“This is a good first step. I think the message
was sent that we’re going to take higher
education [funding] as seriously as we take
K-12,” said Senator Michael Rodrigues, the
Senate’s budget chair.
Massachusetts is the only state in the country
with a fiscal year starting July 1 in which the
Legislature has yet to pass a final spending
bill. State government has not shut down because
lawmakers passed a temporary $5 billion budget
in late June, but the delay in reaching a budget
deal had prompted House Speaker Robert A. DeLeo
to call on Baker to file another stopgap
spending measure.
The move sparked questions of just how long
negotiations could drag on, but both chambers’
budget chairs said they were hopeful the state
would not need another placeholder to supplement
the $5 billion appropriation, even though the
10-day window Baker is given to review the
budget could carry into August.
“All in all, I wish we would have completed it
three weeks ago,” Rodrigues said Sunday. “It’s a
good, fiscally responsible budget. Hopefully
tomorrow, the House and Senate can vote on it
and send it to the governor.”
Lawmakers also reached a compromise on a
controversial proposal to tackle prescription
drug spending in the $16 billion MassHealth
program, the state’s version of Medicaid. Their
budget deal gives administration officials more
authority to negotiate prices with drug
manufacturers, and it would allow the
administration to set a proposed value for
expensive drugs and to hold public hearings
about the proposed value.
The compromise budget allows the administration
to refer an expensive drug to the state Health
Policy Commission for further review. The
commission could then demand detailed
information about the drug price.
Baker’s original proposal went further, allowing
the Health Policy Commission to refer drug
makers to the attorney general’s office for
investigation under consumer protection law.
The compromise budget does not include the
mechanism to refer drug companies to the
attorney general, and it would not force drug
companies to testify before the Health Policy
Commission at a public hearing.
Rodrigues said lawmakers spoke with Attorney
General Maura Healey, who said “very clearly”
that she has the authority to intercede without
a specific referral.
The debate around drug pricing was marked by
heavy lobbying from industry groups such as the
Massachusetts Biotechnology Council. Industry
lobbyists argued that Baker’s proposal went too
far; they said it would punish innovative
companies while chilling investment in the
sector.
Senators largely sided with Baker in their
budget proposal, while the House softened the
language.
“I think the process that we have in place will
allow for us to accomplish the goal that we all
want, to lower drug prices,” said Representative
Aaron Michlewitz, the House’s budget chair.
Massachusetts Biotechnology Council president
Robert K. Coughlin said the Legislature’s
compromise on drug pricing is “the most severe
Medicaid drug pricing reform in the country and
is not a win for the life sciences industry.”
But Coughlin thanked House and Senate budget
negotiators for leaving out “the most radical
language proposed by the Baker administration.”
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