The Massachusetts House of Representatives on Wednesday almost-unanimously passed a version of Governor Charlie Baker's proposal aimed at helping to plug the state's urgent $768 million budget gap.
The bill is mostly in line with Baker's plan. It makes cuts to funding for an array of state offices and institutions of higher education; it diverts tax revenue meant for the state's rainy day fund; and it creates a temporary corporate-tax amnesty program.
But one component that the House's plan did not include: language giving the governor greater authority to chop parts of the state's Medicaid program. Advocates for people with disabilities, elderly people, and poor people had balked at that move, saying it would give Baker too much leeway to cut key programs that serve their constituencies.
Baker, a Republican, lauded the Democratic-controlled House's action in a statement, thanking Speaker Robert A. DeLeo and the chamber for acting quickly.
"We look forward," he said, "to swift action by members of the Senate, and to working closely with both houses in the future on a commitment to craft a fiscally responsible and sustainable budget plan for next year that continues to protect local aid and Massachusetts taxpayers."
The bill, which covers only the fiscal year running through June, drew a single vote in opposition in the 160-seat House. It is slated to be taken up by the Senate on Thursday; if the measure passes without changes, it would need a final procedural vote from both chambers before going to the governor for his signature.
Like Baker's plan, the House bill cuts state funding for many departments and agencies — such as the secretary of state's office and the Suffolk district attorney's office — by 1.79 percent, and state colleges and universities by 1.5 percent.
Among the deviations from Baker's proposal: The House is shielding the Committee for Public Counsel Services, which covers public defenders, and county sheriff's departments from the 1.79 percent cut.
A House budget committee aide explained that because costs for sheriffs and public defenders this fiscal year are already expected to be greater than the money the state has allocated for them, it did not make sense to cut their budgets only to have to replenish them closer to June.
The biggest entry in the bill temporarily suspends the state law that directs a certain stream of tax money to the reserve account earmarked for fiscal emergencies.
Under normal circumstances, all capital-gains taxes collected beyond about the first $1 billion are added to the rainy day fund.
The House bill, keeping in line with Baker's proposal, diverts the tax proceeds above the threshold instead to the state's general fund just for this fiscal year. The measure is expected to help close the budget gap by $131 million, the administration has estimated.
The rainy day fund now totals more than $1.1 billion, and is seen by fiscal analysts, including bond-rating agencies, as an important metric of the state's financial well-being.
The House bill also cuts transportation funding by $40 million, spread between the state Department of Transportation and the MBTA, a reduction that Baker proposed; the governor pledged that it won't hurt the already struggling T.
In a speech on the House floor, the chamber's top budget expert, Representative Brian S. Dempsey, explained those transportation cuts and called them "not desirable, but not impacting service."
The temporary corporate-tax amnesty program would, for 60 days and with some exceptions, waive penalties, but not interest, for companies that owe the state money, with the aim of bringing in more revenue. The Baker administration estimates the amnesty would raise $18 million.
The Baker administration has said $282 million of its deficit-reduction plan relies on legislative approval. The remainder of the cuts, additional revenue collection, and budget adjustments to close the gap in the state's $36.5 billion budget would be executed by the governor under his executive powers.
The administration estimates that the changes the House made to its plan would mean about $18 million worth of Baker's proposed cuts will not be executed.
Baker's plan and the House-passed bill adhere to the governor's pledge not to raise taxes or fees, or cut aid to cities and towns.
Baker was sworn in as governor on Jan. 8, succeeding Democrat Deval Patrick, and was immediately faced with the challenge of filling the substantial hole in the state's budget that he has said was caused primarily by the government spending too much money.