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Challenge to the Legislature
The Boston Globe, Editorial, January 24, 2008

GOVERNOR PATRICK'S second budget proposal combines prudence with risk. It seeks greater efficiencies in existing state programs to fit them within the limits of slow revenue growth expected next year. At the same time, it relies on revenue estimates made before the current market downturn and urges the Legislature to adopt new revenue sources to allow for an expansion of local aid and improve early education, combat homelessness, and enhance public safety.

Patrick's budget is the first draft of the final budget plan that will control state spending for the 2009 fiscal year, which begins July 1. The House of Representatives will get an opportunity to weigh in next.

House Speaker Salvatore DiMasi and his budget lieutenant, Ways and Means Chairman Robert DeLeo, need to look again at Patrick's plan to close business tax loopholes, which DiMasi dismissed last year. It would raise $297 million, a considerable sum, but not enough to discourage any company from operating in Massachusetts.

The House leaders also need to act on the governor's plan to allow casinos in the state. Patrick may be optimistic when he thinks selling licenses for these will raise $124 million in fiscal 2009. But Patrick is right that the state needs this money. His budget aides have put the money in the local aid account and have included the amount that each city and town will receive. This move was nervy, but it does emphasize how much the revenue could accomplish.

Patrick would dip into the rainy day fund for $369 million. That's a reasonable amount given slow revenue growth, and still leaves nearly $1.9 billion in reserve. House budget writers may be tempted to take more. They should hold off in case worse times are ahead.

The governor, aware that escalation in health insurance costs poses a continuous challenge to the budget, seeks aggressive restrictions on Medicaid spending and would force 58,000 state employees to contribute more for their coverage. Both proposals need to be carefully examined by the Legislature. State employees are sure to complain about the high cost, but they should not be shielded from cost pressures that people in the private sector have been feeling for years.

The governor's policy initiatives are quite modest in comparison to the entire $28.2 billion budget. An additional $23 million would enhance learning opportunities for kindergartners and younger children. An extra $4 million will be well spent to address gang-related crime. And an $8.3 million appropriation would begin the process of encouraging homeless people to move from shelters into permanent housing.

If economic woes worsen, the House and then the Senate will have to tighten the budget further before the Legislature approves the final version in early summer. Whatever happens to the economy, the state needs new revenue sources to meet its obligations. Patrick's budget challenges lawmakers to face that reality.

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