Cities, towns wary of slim local aid
In each of his eight years as governor, Charlie Baker kept a campaign promise to propose increasing unrestricted local aid to cities and towns by the projected rate of growth in state tax revenues.
Now, with a somewhat muted forecast for tax collections ahead of Gov. Maura Healey’s first budget proposal, leaders from cities and towns told the new administration a similar increase in municipal support “won’t cut it.”
The outlook for unrestricted general government aid, or UGGA, was one of the top issues municipal officials flagged Tuesday at the first Local Government Advisory Commission meeting during Healey’s tenure, alongside a jump in special education costs and schoolrelated burdens.
With Healey’s fiscal year 2024 state budget due by March 1, a string of city and town officials briefed Lt. Gov. Kim Driscoll and Administration and Finance Secretary Matt Gorzkowicz on financial pressure points they face and their hope that the new team will make additional state dollars available.
Revere Mayor Brian Arrigo urged the administration to decouple unrestricted local aid from the projected 1.6% growth rate of state tax revenues that top lawmakers and the Healey administration expect in the next fiscal year.
“Unrestricted general government aid — UGGA, as we all know it and love it — has historically been tied to the projected increase in tax collections, and the predictability of that is really helpful for us in budgeting,” Arrigo said. “But secretary, you mentioned a 1.6% increase in the consensus revenue forecast. We all know that won’t cut it for us on a local level.”
Last year, Baker proposed increasing unrestricted local government aid at the same 2.7% rate as the forecasted growth in state tax revenue, but he and lawmakers eventually agreed to a Senate push to double the UGGA increase to 5.4%.
Arrigo recounted that history Tuesday, saying the original 2.7% increase “wasn’t adequate for the rising costs that we were seeing.”
“Hopefully, that tactic can continue,” he said of decoupling local aid growth from state tax revenue growth.
Decoupling from state revenue projections could lead to larger amounts of aid, or lower ones depending on the fiscal state of affairs during the annual state budget cycle.
Another issue the Revere mayor flagged is a sharp increase in local special education costs.