Gov. Baker Signs $41.2 Billion Budget, Nearly A Month Into Fiscal Year

Nearly one month into the state's new fiscal year, Massachusetts finally has a budget.

Republican Gov. Charlie Baker signed the $41.2 billion spending package into law on Thursday, ending the state's status as the only one in the nation without a permanent budget.

Baker vetoed nearly $50 million in spending from the plan. He also rejected a proposed pilot plan to discount tolls for motorists who commute during off-peak hours.

By contrast, Baker vetoed $320 million in spending from the budget for the last fiscal year, and $256 million from the fiscal 2017 budget that took effect on July 1, 2016. In both cases, the Legislature overrode many of those vetoes to restore some of the funding.

The state's fiscal year began July 1, but lawmakers didn't agree on a budget for 18 days.

By signing the plan Thursday, Baker is giving the Democratic-controlled Legislature a few more days to consider veto overrides. He could have waited until Saturday to sign the budget.

The Legislature ends its formal sessions Tuesday for the year.

Baker said the budget builds on his administration's efforts to produce fiscally responsible budgets while increasing education funding and investing in areas like local aid, the opioid and heroin epidemic, and economic development - all without broad tax increases.

He said the budget will increase the state's stabilization — or "rainy day" — fund to $2.1 billion by the end of the current fiscal year — the highest in more than a decade. Baker said the budget also includes an increase in the state Earned Income Tax which he said will help 450,000 working families in Massachusetts keep more of their earnings.

"Today the Commonwealth is more fiscally sound than it's been in over a decade," Baker said.

Among the items rebuffed by Baker was the discount toll pilot program.

The proposal called for the state Department of Transportation to launch a test program for offering discounted tolls to motorists who travel during off-peak travel times. The goal would be to offer an incentive to commuters to avoid rush hour travel and thereby reduce highway congestion.

Some critics said discounted tolls during off-peak hours would be unfair to rush-hour commuters who have no choice when to go to work.

Baker is instead calling for state transportation officials to conduct a detailed study of possible alternatives for reducing traffic congestion and report their findings to the Legislature by June 30, 2019.

"I think putting a pilot in place before you actually do the work to figure out what will solve and work to improve our issues with respect to congestion puts the cart before the horse," Baker said.

The so-called "smarter tolling" idea had been strongly advocated by Chris Dempsey, executive director of the advocacy group Transportation for Massachusetts. He urged lawmakers to restore the original language of the proposal.

"While it's encouraging that Governor Baker recognizes the need to find solutions to the Commonwealth's worsening traffic crisis, the longer we wait to test innovative ideas, the longer Massachusetts will be stuck in place," Dempsey said in a statement. "A study of statewide congestion issues is necessary — but not sufficient."

Baker also sent back to lawmakers a proposal that would abolish the state's longstanding policy of denying additional welfare benefits to children who are born to families already on welfare.

While the governor did not object to eliminating the so-called "cap on kids," he said the change should also be accompanied by other reforms in the state's welfare program, including one that would allow federal Supplemental Security Income to be used in calculating eligibility for Aid to Families with Dependent Children.

Supporters of lifting the cap on kids said it would help about 9,000 low-income children in Massachusetts

Baker's vetoes now head back to the Massachusetts House and Senate, where Democrats have large enough majorities in both chambers to override as many vetoes as they want.

Baker offered a word of caution, saying that while the state may be experiencing an uptick in revenue, Massachusetts has experienced tough times in the past.

"We must keep in mind and plan for the future to continue maintaining that fiscal discipline," he said.