BOSTON — House budget leaders are unveiling a $27.8 billion spending plan (PDF) for the state’s new fiscal year, including $234 million in cuts to local aid to cities and towns.
House Ways and Means Chairman Charles Murphy said the budget proposal includes no new taxes and doesn’t draw from the state’s rainy day fund. He said the plan reflects a 3.2 percent increase in spending over the current year’s budget.
Murphy called the fiscal situation facing the state “challenging” and said the House plan reflects that with $1.4 billion in cuts and savings.
“It’s a challenging year,” he said. “I would suggest the budget is reasonable and balanced.”
The budget relies in part on $1.5 billion in one-time federal stimulus dollars.
Murphy also said the budget’s bottom line is $400 million below the budget plan released earlier in the year by Gov. Deval Patrick.
Murphy’s budget trims spending on a program that provides some health care coverage to tens of thousands of legal immigrants. Murphy said the budget would fund the program at $60 million – enough to cover those already on the program, but not enough to expand add new members.
He said Patrick’s budget had funded the program at $75 million.
Patrick’s $28.2 billion budget maintains education and local aid for cities and towns while increasing taxes on candy and soda and scaling back a tax credit that has lured movie makers to Massachusetts.
Patrick’s budget plan also relied on drawing $175 million from the state’s dwindling rainy day fund.
Michael Widmer, president of the business-backed Massachusetts Taxpayers Foundation, said the House budget reflects the state’s austere revenue situation.
“From a fiscal point of view, this is an improvement on the governor’s budget,” said Widmer, who defended the House’s proposed local aid cuts. “They need to share in the pain given our fiscal realities.”