The State Budget

I started this campaign by emphasizing my financial expertise and my experience preparing budgets in a public setting. I have stressed throughout the campaign that the annual budget is the most important piece of legislation, year in and year out. I look forward to using my experience and expertise to help make the state budget a bit more accessible.

Let's go into more details here, looking at the numbers for the operating budget and the process.

The Operating Budget Numbers

The actual FY 2013 budget is based on bill H.4200 that came out of the joint committee at the end of June. The conference report is 280 pages long and contains 229 sections. Sections 1, 2, and 3 are the real meat of the budget, and I have spent most of my time looking at them. The other sections have a variety of provisions, calls for studies, earmarks, and other directives for spending money. They are interesting too -- I just have not parsed them yet.

Taxes, Grants, and Department Revenue

Here are the main categories of revenues projected for FY 2013. Note that income taxes are just a bit more than one-third of the total shown here, and that Federal Reimbursements (mostly for Medicaid) are more than eight billion dollars, or about one-fourth of the total available.

Taxes (Total in millions)  $ 21,950,000,000
  Income     12,731,800,000
Federal Reimbursements  $ 8,270,200,000
Federal Grants  $ 2,414,800,000
Department Revenue  $ 2,547,100,000
TOTAL OF ABOVE ITEMS              $ 35,182,100,000

Under existing federal legislation, there may be a temporary spike in federal reimbursements over the next few years -- a couple billion of dollars or so. But before we get too excited, let's remember two things. First, if it does occur, it will be a temporary boost, not a permanent boost, and we should plan accordingly. Second, what will happen if there is a political change in Washington is anyone's guess.

Direct Budgetary and Federal Grant Spending

Administration and Finance2,757,000,000
Energy and Environment182,500,000
Housing and Economic Development420,200,000
Labor and Workforce Development34,600,000
Health and Human Services15,579,100,000
Ind. Agencies and Constitutional Officers3,017,800,000
Public Safety and Security908,000,000
Federal Grant Spending2,414,800,000
Selected Transfers3,048,400,000
TOTAL OF ABOVE ITEMS  $ 35,339,000,000

The flip side of the large federal reimbursements is shown here: we spend more than 15 billion dollars on health and human services in the state. This portion of state spending has grown over the past 5 to 10 years much more rapidly than any other category, and it continues to threaten our ability to fund other programs. Clearly, controlling the net outlay by the state on health care (total state spending less reimbursements) on a long-term basis is a vital priority.

What is in the Budget?

First, there are a lot of lines to the budget: about 665 lines in the main section, and another 497 for the federal grants, plus the list of town-by-town payments for school aid and unrestricted aid. And each line has a summary description and in many instances additional instructions which begin with the words "provided that". I counted 1,549 "provisions" in the main section of the budget. Some are major administrative directives and others are earmarks, setting aside usually a small amount of money for a very specific project.

I made a spreadsheet that puts each provision in a row, and you can scan it to see what it is like. You can download it here -- try searching the 'provisions | earmarks' tab for "Revere", "Quincy", or "Plymouth".

The Budget Process: A State Rep's Perspective

The State Rep needs to follow the budget process throughout the year. The state budget year runs from July to June, so the rep's work begins in the fall when the administration does the fact-finding and priority-weighing work to prepare the Governor's budget, which is presented in January. The focus then moves to the House, and each State Rep needs to present her or his priorities to the Ways and Means committee, preferably by the end of February, and continue to make the case for these priorities in all venues throughout the winter.

In April, the House Ways and Means committee presents a budget, and there is a week or two filled with amendments being offered and deals made. The State Rep needs to be in the thick of this, prepared with amendments and prepared to find and join coalitions to push for a package of amendments.

The end of April is actually a pretty wild time -- almost anything can suddenly pop up during "amendment week". A lot of amendments are "provisions" that earmark funds already in the budget for specific pet projects. (Any freshman Representative, whether Democrat, Republican, or Independent, is not going to get many earmarks.)

Sometimes, a budget amendment is actually a substantive policy issue. For instance, in 2011, Rep. Poirier of North Attleboro offered an amendment to direct the Governor to spend money on federal immigration enforcement issues. It was narrowly defeated, 73 to 84, in what might be the closest roll call vote of the 2011-12 session. (I would have voted No.)

The State Rep who waits until the end of April to understand what the other 159 representatives want will be out of luck. Instead, an effective Representative must not just understand the priorities of the district, but also the priorities of all the other districts that may be partners in a larger coalition.

After the Budget: Monitoring the Spending

In a real example of open innovative government, the state government is now making available datasets that identify the actual spending, check by check, that occurs each year. Not every transaction is recorded, but most of them are.

As a State Rep, I will make full use of this important new public dataset to monitor the actual spending and use that to influence the preparation of the next year's budget.