State House News Service

Mass. Senate Passes $34 Billion Budget

BOSTON — The Senate approved a $34 billion annual state budget late Thursday that makes investments in early education, elder care, local aid and other areas in part by drawing from the state’s reserves and relying on revenues from a developing package of tax increases linked to the transportation system.

The budget, approved on a 36-3 vote, mirrors the spending bottom line in the House budget approved in April. Differences will be worked out by a six-member conference committee in June, with fiscal 2014 starting July 1.

The Senate used floor amendments to add $68.4 million to a plan authored by the Ways and Means Committee, putting the final bill “within a micro-dollar” of the House, according to committee chairman Sen. Stephen Brewer.

The budget spends $350 million from the state’s rainy day fund and includes a $15 million increase for early education to reduce the pre-school waitlist by 2,000 students, a proposal not featured in the House budget.

“We now have to get to work in reconciling the transportation funding bill and also to get to resolve all of these budgets so we have a lot of work throughout June, but we’ll get there,” Brewer said.

House and Senate leaders head into budget talks knowing that their spending plans fall roughly $800 million short of the requests of Gov. Deval Patrick, who sought larger tax hikes and bigger allocations for transportation and education that he said would help grow the economy and address longstanding needs.

Over the course of two long days of debate, the Senate dispensed with 725 amendments, adopting 195 proposals including plans to overhaul the management of the Sex Offender Registry and expand the 5-cent bottle deposit law to include water and sports drinks.

“Everyone got an opportunity to participate and debate and it was a real lesson in democracy,” Senate President Therese Murray said after the final vote Thursday night. In a heartfelt tribute, Murray sponsored a successful amendment naming the state’s ALS Registry after former Gov. Paul Cellucci, who is battling the disease.

Senators also voted to make nearly $40 million from a distressed hospital fund available to increase reimbursement rates to community and safety net hospitals that provide a disproportionate amount of care to Medicaid patients.

“Many hospitals are hanging on by their fingernails, and we’re trying to throw a lifeline to keep some of them operating,” Brewer said.

The House and Senate budgets differ significantly in their support for the University of Massachusetts where officials have pledged to avoid tuition and fees hike for the next school year if state support is increased to levels they have requested.

Sen. Michael Moore, the co-chair of the Higher Education Committee, backed off his amendment to boost funding for UMass by $24 million that would have put the Senate in line with the House. Moore said he was unsure of support levels for his amendment and didn’t want to undermine the Senate’s bargaining position in conference.

Frustrating Republican senators, the Senate also deferred action on reforms to public assistance programs in anticipation of a comprehensive welfare reform bill Senate President Therese Murray is expected to roll out in the coming weeks. The Senate rejected attempts by Sen. Robert Hedlund (R-Weymouth) to require photo ID on electronic benefit transfer cards and to restrict access to cash from EBT cards.

Sen. Michael Knapik, a Westfield Republican, was the only member of the minority party to vote in favor of the budget, while Minority Leader Bruce Tarr and Sens. Hedlund and Richard Ross vote against the bill.

“It’s based on what I consider an unsustainable amount of spending, based on taxes that I don’t think are appropriate,” Tarr said after the vote, concerned that the budget was based on nearly $500 million in tax increases on tobacco, gasoline and businesses included in a transportation financing bill that is still being negotiated in conference committee.

“We don’t have a completed tax bill yet and this budget is based on revenue from that bill and I think it would be inappropriate to move forward until we know how we’re going to pay for things that are in the budget,” he said.

Senators on Thursday night debated an amendment offered by Sen. Mark Montigny that would have required mutual corporations to allow policy holders to weigh in through non-binding proxy votes on the compensation of executives.

Invoking the generous compensation package for former Liberty Mutual CEO Ted Kelly, Montigny said it was only fair that policy holders who own mutual corporations be given the same rights as stockholders in publicly traded companies. Financial Services Committee Co-Chair Sen. Anthony Petruccelli urged his colleagues to give his committee time to seek testimony on a bill before making a recommendation.

Senators from western Massachusetts expressed concern that the amendment could have unintended consequences for Mass Mutual, the largest employer in that area, and said the Senate shouldn’t rush into a change that could cost jobs. “The road to hell is paved with good intentions . . . I can’t take that risk,” Sen. Gale Candaras said.

Montigny scoffed at his colleagues protesting the idea of adding policy changes to a budget already full of complex policy initiatives, echoing former Minority Leader Brian Lees when he said, “Give me a break.” The amendment was rejected 9-26.

The Senate also rejected a Tarr amendment that would have increased to $2 million the minimum value of a contract for state services triggering the so-called “Pacheco Law” that requires agencies to prove savings and meet other criteria before it can privatize services. Tarr called the law “cumbersome” and said it had a “chilling effect on innovation.” The House budget increased the threshold from $500,000 to $750,000.

Pacheco said the law dating to the early 1990s was meant to protect taxpayers from administrations funneling state contracts to political donors and friends. He said any agency can privatize a service if they can prove it saves one penny. The amendment failed 8-30.

The Senate unanimously approved two $11.5 million salary reserves to human service and child care providers. Sens. Karen Spilka and Michael Moore said the goal was to boost pay for some of the lowest paid human service workers.

Sen. Brian Joyce’s amendment to give judicial pay raise similar to those approved in the House also passed, but another amendment he filed to tie judicial pay to the rate of inflation failed.

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