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Metro

Patrick administration avoids local aid cut in budget proposal

News welcome to cities, towns

For the first time in four years, Massachusetts cities and towns may not face deep cuts in local aid, the lifeblood that helps cities and towns pay for police, trash pickup, tree trimming, and other services.

In its first volley of the budget season, the Patrick administration said yesterday that it would keep state aid to municipalities level, buoying the spirits of mayors, town managers, and selectmen as they begin hammering out spending plans for the coming year.

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“The good news is there isn’t bad news,’’ said Mayor Thatcher W. Kezer III of Amesbury. “Revenues have stabilized. Local aid has stabilized.’’

In a speech before hundreds of municipal leaders, Lieutenant Governor Timothy P. Murray offered upbeat but cautious highlights of the administration’s proposed budget for the coming fiscal year, which will be unveiled in its entirety Wednesday. The key point for cities and towns was a plan to hold local aid at $833 million.

Murray also announced that state aid to local schools would be increased by $145 million, or 3.6 percent. Money to fix local roads would be augmented by an additional $45 million, giving cities and towns resources to repair streets battered by last winter’s unrelenting snow.

The administration’s spending plan for the forthcoming budget year also includes $260 million worth of proposed tax and fee increases, from boosting the cigarette tax by 50 cents a pack to eliminating a tax deduction for losing lottery tickets.

The budget is based on a modest rise in tax revenues, which are expected to increase by 4.5 percent in the fiscal year that begins in July.

‘The good news is there isn’t bad news. Revenues have stabilized.’

Thatcher W. Kezer III Mayor of Amesbury
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“That’s good news and part of an encouraging trend,’’ Murray said in a speech at the annual meeting of the Massachusetts Municipal Association. “But it doesn’t mean we’re out of the woods yet.’’

Rising costs from inflation, healthcare, and other expenses continue to outpace the growth of tax revenues. To make up the difference, the administration will propose some cuts, said Jay Gonzalez, Governor Deval Patrick’s secretary of administration and finance, who would not name specifics yesterday.

Some of the $260 million in tax increases, such as a sugar and soda tax, have been proposed before and failed to pass. Republicans, who control just a few seats in the Democratic-dominated Legislature, quickly objected to the revenue hikes.

“One thing is clear,’’ House minority leader Bradley H. Jones Jr. said in a statement. “The Patrick administration has a sweet tooth for tax increases.’’

Yesterday’s speech by Murray marked the start of a months-long budget process. Numbers, proposals, and tax revenues will change, perhaps significantly, before a final budget is adopted for the next fiscal year.

“It’s going to be very tight,’’ said Michael J. Widmer, president of the Massachusetts Taxpayers Foundation. “There are going to be a number of places where there are budget cuts.

“It’s better news than the last several years for sure, but it’s also a fifth consecutive year of budget squeeze,’’ he said. “This is the longest fiscal siege that state and local government have experienced in decades.’’

The Patrick administration acknowledged that it would be another challenging budget season, but also sought to highlight the state’s progress recovering from the recent fiscal tumult. Local officials took note of the $145 million in additional education spending, which would bring total state aid for local education to $4.1 billion, highest in state history.

But the increase will not necessarily mean more teachers or new supplies for the classroom. The $145 million will cover costs that rise each year, such as fuel, healthcare, and salary raises included in labor contracts. The money will give all districts the same resources as the current year. But in the recent fiscal climate, anything short of a cut is good.

“They are telling districts not to push the panic button,’’ said Glenn Koocher, executive director of the Massachusetts Association of School Committees.

“I think the governor has gone out of his way to shield much of public education from the impact of the last three years,’’ Koocher said. “Schools across the country have been enduring really serious cuts.’’

Municipal leaders have also found new ways to cut costs, most notably the state’s recently enacted municipal healthcare law.

Murray said that nine communities have already used the law to save more than $30 million. The city of Beverly, for example, expects to save $1 million on health care, according to Mayor William F. Scanlon Jr.

The announcement yesterday that local aid would remain steady provided more reason for optimism, even if other costs increase.

“After the cuts we’ve had in the past, to be level-funded this year, it’s good news,’’ Scanlon said yesterday. “It’s not going to be easy, but it’s going to be less hard this coming year.

“And it looks like there’s a little bit of sunshine out in front of us.’’

Andrew Ryan can be reached at acryan@globe.com Follow him on Twitter @globeandrewryan.
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