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19755483116_2b295368dc_kOn Friday, July 17, Governor Charlie Baker put pen to paper on his first state budget, signing the $38.117 billion budget into law with Lt. Governor Polito, Secretary Lepore, and Secretary Pollack around him.

In a break from previous budget cycles, the FY16 plan holds growth to a responsible 3% over the previous fiscal year, and solves a $1.8 billion structure deficit, while at the same time avoiding new taxes, investing in local aid, education and transportation, and not drawing down the state’s “rainy day fund.”

In a victory for commuters and taxpayers, the administration has been given many new tools to fix the troubled MBTA including the creation of the MBTA Fiscal Management & Control Board, and a three-year suspension of the Commonwealth’s anti-privatization law. Governor Baker wasted no time, appointing and swearing in the members of this new oversight board within minutes of applying his signature to the budget. The budget also provides an additional $105 million in transportation funding, with a 53% increase in direct MBTA aid.

Going to bat for more than 400,000 lower income individuals and working families, the FY16 budget includes a 50% boost in the Earned Income Tax Credit (EITC). In addition to avoiding new taxes, residents across the Commonwealth will enjoy the anticipated reduction in the state income tax to 5.1% on January 1, 2016–a reduction they voted for 15 years ago.

“As we implement our vision for a greater Massachusetts, we look forward to beginning the work of fixing the MBTA, investing in vital services for our most vulnerable, and curbing the opioid epidemic that has claimed far too many lives,” said Governor Baker.

As go the cities and towns of Massachusetts, so goes the Commonwealth. The FY16 budget recognizes that fact and supports municipalities in many ways. Fulfilling a previous pledged commitment, this budget increases unrestricted local aid by 75% of tax revenue growth, a step towards 100% in Year 2 of the administration. In addition to bringing local education (Chapter 70) funding to historic levels, this budget also offers grants for summer jobs to a record $11.5 million.

“This budget delivers on our commitment to our cities and towns, increasing local aid in a way that reflects the Commonwealth’s growing economy and invests $2.6 million worth of Community Compact Cabinet grants we initiated early in our administration,” said Lt. Governor Polito.

As part of the administration’s Urban Agenda, development grants to the tune of $2 million are available to urban communities, as well as $1 million for the Transformative Development Initiative’s support of Gateway Cities.

Recognizing the growing opioid epidemic and the work of the Governor’s Opioid Working Group, the budget supports $111 million in substance abuse prevention and treatment efforts, with an additional $28 million included in the supplemental budget.

The supplemental budget not only adds funding based on the Working Group’s recommendations, but also includes enhanced funding for homelessness prevention, additional money to help cities and towns recover from last year’s record snowfall, and an increased bottom line for the Stabilization Fund for the first time in three years.

The administration is proud to achieve so many goals in this first budget, but no budget is perfect, and the one sent by the Legislature is no exception. The administration identified $83 million in additional spending over our original House 1 proposal, as well as several underfunded accounts. Accordingly, this budget reflects $162 million in line-item and outside section vetoes.

Putting the state back on solid fiscal footing will play a major role in making our Commonwealth a better place to live, work and raise our families.

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