MTA analysis of the House Ways & Means FY2019 budget
The House Ways and Means Committee released its version of the Fiscal Year 2019 (FY19) annual state budget on Wednesday, April 11. The proposal, known as House Bill 4400, allocates $40.991 billion in spending, an increase of 3.1 percent over the current fiscal year and roughly $83 million more than Governor Charlie Baker proposed in his FY19 budget, House Bill 2.
The appropriations bill serves as the benchmark in terms of policy and funding levels for the House’s budget debate, which will take place the week of April 22. Members of the House may file amendments to the budget, which will then be subject to debate and review. The deadline for amendment filing is 5 p.m. on Friday, April 13. The MTA will be informing members about amendments that the association is supporting.
Chapter 70 Funding
H.4400 proposes increasing Chapter 70 aid by $124 million over FY18, an increase of 2.6 percent. This amount represents a $20,957,822 increase over the governor’s FY19 proposal.
Funding for the Special Education Circuit Breaker was increased by $18.8 million over FY18, which is $8.9 million more than the governor proposed. The circuit breaker program reimburses districts for high-cost special education students. “High-cost” is defined as four times the state average per pupil (based on state funding formulas). The state reimburses districts for 75 percent of costs above this threshold for prior-year costs.
Charter School Reimbursement
State funding for charter school reimbursements was increased by $9.5 million over both the FY18 funding level and the governor’s proposal. In FY18, this amount was less than half the amount needed to fully fund this program. Under current statute, communities receive tuition reimbursement for any increase in tuition paid to charter schools over the previous year. That reimbursement is 100 percent of the increase in the first year and then 25 percent of the increase for the next five years. It is important to note that these reimbursements are subject to appropriation, and in the past, communities have not received the full amount owed to them because of insufficient state funding.
A number of months ago, state Secretary of Education James Peyser announced the launch of a new early college initiative. While the governor funded this new program at $3 million in his budget, H.4400 does not provide funding for the program.
Funding for MCAS administration is increased by $100,000, which is substantially less than the $5.1 million increase in the governor’s budget that was added to cover the costs of developing additional tests.
Non-Chapter 70 Education Programs
H.4400 makes a number of changes to non-Chapter 70 grant programs.
Programs receiving funding increases in the FY19 budget:
- Teacher Certification Retained Revenue — $121,104
- School-to-Work Connecting Activities — $364,499
- Regional School Transportation — $1,000,000
- Transportation of Homeless — $1,000,000
- Advanced Placement Math and Science Programs — $300,000
- Charter School Reimbursements — $9,500,000
- Mentoring Matching Grants — $275,000
- METCO — $1,500,000
- School Breakfast Program — $42,010
- Safe and Supportive School Grants — $100,000
- Targeted Intervention (Partnership Network) — $207,833
- English Language Acquisition — $1,644,506
- Adult Basic Education —$2,950,000 (Creates an additional 1,000 slots on the waitlist for English learners)
Programs level-funded in FY19 include:
- Expanded Learning Time Grants — $13,975,592
- School Lunch Public — $5,314,176
- Youthbuild Programs — $1,750,000
- Bay State Reading Institute — $339,500
- Intensive Support for Low-Scoring Districts — $700,000
Programs receiving funding cuts in FY19 include:
- Literacy Programs — $200,362
- Institutional Schools — $37,341
- After-School Programs — $1,148,077 (32.6% cut)
- Department Operating Budget — $2,280,056
Programs eliminated in FY19 include:
- Impact Aid Shortfall Mitigation – $1,400,000
- Regionalization Bonus — $56,920
- Non-resident Transportation to Voc-Tech Programs — $242,500
- Center for Collaborative Education — $200,000
- English Language Learners in Gateway Cities — $250,000
- Innovation Schools — $165,000
Taking estimated tuition remission into account, H.4400 includes a 0.5 percent average increase for higher education operating budgets over FY18, including a 1 percent increase for the University of Massachusetts. State universities were level-funded and community college funding was cut by 0.1 percent. These allocations are largely the same as the funding provided in the governor’s budget.
Underfunding of public higher education is a perennial issue in the Commonwealth.
Collective Bargaining Reserve
Unlike in the governor’s budget, H.4400 does not include a collective bargaining reserve.
Group Insurance Commission Funding
Funding for GIC operations, and premium plan and costs account are the same in both H.4400 and the governor’s budget.
Premium Contribution Split
H.4400, like the governor’s proposal, does not seek to change premium splits for active or retired state employees.
Sick Leave Accrual
Unlike in the governor’s budget, H.4400 does not include language that would cap the accrual of sick leave for state employees.
State Pension Fund Contributions
H.4400 appropriates $2.608 billion to cover the state’s pension liabilities, as required by law.
Cost of Living Adjustment (COLA)
H.4400 provides a 3 percent COLA on the first $13,000 in pension benefits for retired members of the state and teachers’ retirement systems.
Despite these increases, retiree pensions do not keep pace with inflation or the rising costs of health care.
H.4400 anticipates $41.747 billion in revenue, roughly $166 million over the amount projected in the governor’s proposal.