March 5,
FISCAL YEAR 2003 DEFICIT CLOSED, FOCUS SHIFTS TO 04
Romney Calls for Same Cooperative Spirit to Solve Next Year’s Budget Gap
Governor Mitt Romney, in unprecedented partnership with the Massachusetts Legislature, today closed the Fiscal Year 2003 budget gap by signing the budget-balancing legislation.
“The members of the Legislature and the Administration have successfully closed the $650 million budget gap and set a precedent of cooperation that will help us produce a fair and balanced budget for the next fiscal year,” said Romney.
Added to the $343 million in 9c reductions taken by Governor Romney, the $386 million budget-balancing bill provides a total of $729 million in solutions to close the FY03 budget gap. Barring any unforeseen circumstances, the current year budget is now in balance.
While proposed changes to Medicaid eligibility and increasing the state employees share of health care costs have not been adopted, Romney said he expects them to get renewed focus going forward.
To assist in cost recovery efforts at the Big Dig, Romney has signed the section extending the statute of limitations on claims to 10 years, from three years. This change will give the state the time necessary to collect potential funds owed the Commonwealth for costs associated with the project.
“The state's economic reality drove the state budget into deficit mid-way through the fiscal year,” said Lieutenant Governor Kerry Healey. “In order to stop the hemorrhaging of red ink, we worked with the Legislature to hammer out a plan to put our fiscal house in order. Cities and towns and government agencies all shared in a collective belt-tightening that was not easy, but necessary.”
Romney is signing the entire bill with the exception of the following vetoes:
- A provision to extend the two-year cut off of welfare benefits for participants in DTA's Employment Services Program. This section would undermine the two-year limit on welfare benefits that was one of the cornerstones of the Commonwealth's welfare reform law.
- A provision that prevents the closing of tax loopholes from taking effect today. This provision, if not vetoed, would cost the Commonwealth millions of dollars by delaying tax loophole closures from taking effect right away.
Romney is also approving the Legislature's transfer of $17 million from the Renewable Energy Trust to the general fund in order to help balance the budget. However, Romney has agreed to commit $17 million, one of the largest pledges in the country, to the state's purchase of renewable energy.
Romney also reluctantly signed an outside section lifting the moratorium on School Building Assistance program. The program has grown to an unsustainable size. At present, the Commonwealth's potential liability, including the existing priority waiting list, is over $11 billion, for which there is no corresponding revenue source.
“Many have called this program the state's second Big Dig,” said Romney. “The program has laudable goals, but we must get the costs to the Commonwealth under control.”
To help control this budget buster, Romney has directed Education Commissioner David Driscoll to add no new projects to the priority waiting list, beginning on July 1, 2003. In the interim, the Commissioner will give consideration to adding the most urgent projects to the priority waiting list and he will also consider approving no more than one project per community.
“The Fiscal Year 2004 budget also presents many challenges,” added Romney. “I have presented my Common Sense for the Commonwealth budget and look forward to working with the Legislature in the coming months to develop a plan that protects the state's core missions and does not depend on increased taxes and the status quo form of government. The time for change is now and I believe we can reform government and make it work more efficiently for our citizens.”
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