Patrick Budget Relies Heavily On Uncertain Federal Funding

State lawmakers, human service providers and other stakeholders that rely on state aid are all poring over the budget unveiled Wednesday by Gov. Deval Patrick. It has $800 million worth of budget cuts and relies on $600 million in yet-to-be-approved federal aid in order to keep the state budget balanced.

In unveiling his $28.2 billion spending plan, Patrick said the impact on many services is real. It's an overall 3 percent increase over the fiscal 2010 budget.

"This budget is about people, not just numbers or line items," Patrick said. "And for that fundamental reason, proposes to invest in jobs, education, health care and services for the most needy."

Most challenging in trying to make those investments was the need to close a $2.7 billion budget shortfall. The governor's proposal contains about $800 million worth of program cuts, many in the human services sector.

Among the services preserved is the continued funding of the Commonwealth Care program that provides health care coverage to 170,000 adults, a key part of the state's 2006 health care law.

Local aid to cities and towns is not cut, nor is so called "Chapter 70" education funds the commonwealth distributes directly to school districts around the state.

But the proposal does call for the reduction of tax credits for the film and life sciences industries, which combined is expected to save the state $80 million. The governor said he doesn't think the reductions will cost the state jobs.

"Life sciences has taken on, as we had hoped, an engine all its own," Patrick said. "There's a lot of activity in that area. You may have seen just the other day Genzyme has announced they're adding another 500 jobs in the next little while, and we've seen this in smaller pockets all across the commonwealth and we want to see that continue."

The governor is proposing cuts to dental services to poor adults through MassHealth, for a net savings of $56 million. He says community health organizations are stepping forward to fill that gap, and should be able to do it more efficiently.

State parks are also being cut by $3.2 million, but again the governor says other environmental groups may step in to help where they can.

While there are no broad-based new taxes proposed in the governor's budget, Patrick is recommending the repeal of the sales-tax exemption on soda and candy, as well as on smokeless tobacco and cigars, which should bring in an estimated $67 million. The bulk of those funds would be earmarked for health prevention programs.

The governor said he is sure the federal government will come though with some $600 million in Medicaid reimbursements, money he's counting on to keep his budget in balance.

"I spoke with the White House just yesterday, further about this, so we feel very, very confident," Patrick said. "You know every budget is built on reasonable expectations and assumptions, and this is a very reasonable one."

Michael Widmer, of the Massachusetts Taxpayers Foundation, said receiving those federal dollars is crucial.

"If we don't get that second round of money it would be a $600 million hole," Widmer said. "Then we clearly have to have major cuts in local aid and other parts of the budget. That additional money is what allows this budget to minimize the cuts that all of us expected would take place."

The governor's budget proposal is the first step in the annual budget process, which will culminate with a final spending plan sometime around the end of June.