Call this Charlie Baker’s buy-some-breathing-room budget.
Almost since the moment he took office, Baker has been under siege — by the flu, by the weather, by the MBTA failure, and by a mid-year budget deficit that had to be plugged.
On Wednesday, the new governor proposed his first full-year spending plan, the budget for fiscal 2016, which starts in July. Now, budget-making is an evolving exercise, one in which effects that aren’t immediately apparent become so over time.
But that said, Baker seems to have delivered on what he promised: A budget that is balanced without either new taxes or serious cuts to core services. Indeed, as in the Sherlock Holmes story “Silver Blaze,” what’s notable so far is the hounds that haven’t barked in the night. That is, the constituencies that aren’t complaining bitterly about the new governor’s plans.
Here’s more evidence of budgetary success. In the past, two areas that have often felt the effects in tough budget times are higher education and local aid. This budget actually boosts spending a bit in both.
Overall, Team Baker says, their spending plan amounts to level-funding for most accounts. Given that the same number of dollars buys less as time goes on, that will pinch some. But it could also be a prod to exploring new, more creative ways of doing things.
The budget also proposes some changes that, though reasonable, will certainly draw objections from specific groups or interests, and thus may prove tough for the Legislature. For example, some long-time state employees would see their share of their health care premiums move from 20 to 25 percent. But given that employees hired after 2002 already pay that share — and that most private sector employees do as well — it’s hard to view that as a public sector cause celebre.
Baker is also taking aim at the state’s film tax credit, a dubious program, but one dear to the House. Yes, that credit brings movie-makers to Boston, but not in a cost-effective way. It’s great for celebrity-lovers, autograph collectors, aspiring extras, and Teamster film units, but as economic policy it makes little sense.
From my viewpoint, one big question comes on MassHealth, the state’s health care program for low-income residents. The administration is projecting significant savings by paring the rolls of people whose incomes are too high for Medicaid or who have, since being enrolled, taken jobs and acquired private coverage. The accuracy of the new administration’s savings estimates remains to be seen, in part because the state’s Health Connector has been so technologically star-crossed and data-deprived.
A few other caveats. This early effort whiffs on reform of the anti-privatization Pacheco Law, which even Democrats quietly admit acts as an impediment to more cost-effective state government by removing competitive pressures and savings opportunities. Let’s hope that failing doesn’t signal a loss of resolve on that important matter.
And as with all budgets, there is a certain amount of gimmickry at play here. Sometimes it comes as cash-management maneuvers, like rolling bills forward, and thus into another fiscal year. Other times, it’s made manifest as semantic or conceptual games.
An example of the latter: Baker and his team stress that, for the first time in four years, the state won’t be tapping the rainy-day fund to help balance the budget. And yet this budget takes $300 million in capital gains tax revenue meant for that fund.
How can both be true? Well, like a fiscal anti-ballistic-missile system, Baker’s plan intercepts that revenue before it touches down in the rainy-day account, rather than grabbing the money once it’s there. Aha!
But overall, this was a strong performance by the new governor and his team.
If Baker can now persuade the Legislature to take the $1 billion in bonding bandwidth it last year dedicated to expanding the Boston Convention & Exhibition Center and instead apply it to helping improve the MBTA, he will be off to a very good start indeed.
That idea is in the ether in the administration. It’s a good one. Expanding the convention center has boondoggle written all over it. The MBTA, on the other hand, is essential to the Boston area’s economy.
Be bold, governor. Go for it.