Lawmakers send $43 billion budget to governor 3 weeks late

It ends a stalemate that had made Massachusetts the last state with a July 1 fiscal year start to deliver a budget to the governor.

This Wednesday, Jan. 2, 2019 photo shows the Massachusetts Statehouse in Boston. Massachusetts.
–AP Photo/Elise Amendola, File

BOSTON (AP) — Nearly three weeks into the new budget year, Massachusetts could finally have a spending plan in place. Republican Gov. Charlie Baker is weighing a $43.1 billion budget approved Monday by state lawmakers.

The spending plan includes proposals that would rein in Medicaid prescription drug costs, significantly boost public school funding, and require eBay and other large online marketplaces to collect the state sales tax.

But it doesn’t include Baker’s proposed taxes on opioid manufacturers, e-cigarettes and vaping products. It also leaves out a Senate proposal freezing in-state tuition and fees at the University of Massachusetts. Officials at the five-campus system have said they anticipate raising tuition and fees by 2.5% in the coming academic year.

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The budget’s passage ended a stalemate that had made Massachusetts the last state with a July 1 fiscal year start to deliver a budget to the governor. It’s the second consecutive year the state has earned the dubious distrinction.

Baker, who is in Denver this week for Republican Governors Association meetings, now has 10 days to review the plan and make any line-item vetoes. His spokesman said the administration will “carefully review” the plan.

Budget watchdog groups have voiced concern about lawmakers’ increased spending.

The compromise plan boosts tax revenue projections for the 2020 budget year by nearly $600 million, allowing lawmakers to pump more funding into public schools and the state’s Rainy Day Fund. Overall, the plan is larger than the $42.7 billion budget Baker initially proposed and represents a roughly 4% increase over last year’s budget.

“Though these additional investments are welcome, it is possible that this revenue growth will not last forever,” the Massachusetts Budget and Policy Center said in a statement. “A few, unexpected ‘boom years’ do not change the underlying fact that Massachusetts has a long-term problem with inadequate revenues.”

Public education advocates, meanwhile, cheered the roughly $5.2 billion included for K-12 schools, but said lawmakers still need to overhaul the state’s 26-year-old funding formula.

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“Increased state aid, and especially more funding for low-income communities, is long overdue,” the Fund Our Future campaign said in a statement.

Health care advocacy groups and drug companies also appear largely content with lawmaker’s approach to controlling state Medicaid costs. The proposed budget generally gives the administration more authority to negotiate price discounts with pharmaceutical companies on particularly expensive drugs.

The consumer advocacy group Health Care For All called the proposal a “major step forward,” while the Massachusetts Biotechnology Council, which represents drug companies, applauded lawmakers’ decision to drop a provision allowing the attorney general to intervene if the cost of a particular drug was deemed unreasonable.

Monday’s vote came just hours after House and Senate negotiators unveiled their compromise plan late Sunday.

The joint conference committee had been holding closed-door talks since June 5 to work through differences between plans separately approved by the two chambers, which are both controlled by Democrats.

State government had been operating on a $5 billion interim spending plan since July 1, and another stopgap could be required if the budget isn’t signed by Aug. 1.

While there are no penalties for missing budget deadlines, lengthy delays can wreak havoc on state agency and program finances. Delays are also viewed negatively by Wall Street credit rating agencies.

Two other states, New Hampshire and North Carolina, remain without permanent budgets in place after the plans were vetoed by their respective governors, according to the National Association of State Budget Officers.

Associated Press reporter Bob Salsberg contributed to this report.