In an attempt to alleviate Massachusetts' current $1.1-billion state budget deficit, Gov. Deval Patrick has cut $128 million in local aid this year and expects to slash an $375 million more next year. At the local level, these cuts may lead to less spending on public services like police departments and libraries.
Patrick's decision came after the Massachusetts state legislature voted last month to give him the latitude to make changes to the state budget to address the deficit.
The midyear cuts are the most severe since former Governor Mitt Romney's administration made a $114-million reduction in the state's local aid budget in 2003.
The recession shifted the focus concerning Patrick's approach to reductions.
"The governor had to cut local aid to some extent both this year and next because of the economic challenges that we are facing," Cyndi Roy, communications director for the Massachusetts Executive Office for Administration and Finance, told the Daily. "He made a round of emergency cuts in October and … was able to spare any cuts to communities, but given the fact that the economy has rapidly worsened, this time around he has to cut cities and towns."
Although no direct reductions were made to the Chapter 70 program, the state's primary conduit of aid to public elementary and secondary schools, Patrick's measures may have impacted education funding in another way. The governor reduced the amount of lottery revenue distributed to communities and other monies contributed to states and towns, called additional assistance funding.
This funding typically goes toward municipal services such as the fire and police departments, snow removal and road maintenance.
Local officials from all over the state are feeling the pinch, including those in the areas surrounding Tufts.
Somerville will have to roll back some services and amenities. The city's planned refurbishment of its Central Hill Memorial Park has been postponed, and library hours will not be expanded. The mayor had wanted to extend library branches' hours, according to City of Somerville spokesperson Tom Champion.
"There is no doubt we are going to have to look at a variety of budget cuts," Champion told the Daily. "Already, we've moved to leaving a number of vacancies vacant, and we're also looking at ways to trim our capital spending this year."
In Medford, Mayor Michael McGlynn has been working on his new budget cuts and is expected to report his decisions soon.
Somerville will lose about $3 million this year, or 9.7 percent of its non-education aid, Champion said.
"Essentially what has happened is that we have five months to absorb the impact of that $3-million cut" during the current fiscal year, he said.
Yet despite these sacrifices, Somerville remains in a relatively stable position. It spends fewer tax dollars per capita than any city in Massachusetts with a population of 50,000 or more, Champion said. The city has a good credit rating, has not seen significant declines in property values and has not been hit by the same borrowing crunch as have many other communities.
"We have really benefited from really good financial management under Mayor [Joseph] Curtatone's leadership, so we're in good shape to weather the storm," City of Somerville spokesperson Lesley Delaney Hawkins told the Daily.
Meanwhile, Patrick has proposed increasing restaurant and hotel taxes to help cities and towns, which would raise the state's meal tax to 6 percent and hotel tax to 6.75 percent. The governor said that these changes would generate $150 million annually to be distributed to cities and towns.
Another possible measure would give communities the power to raise each of those two taxes by an additional 1 percent and would eliminate an existing loophole that makes telecommunications companies tax exempt.
This legislation would not raise enough funds to eliminate the budget gap, though, and its effects would not be seen in the current fiscal year, according to Champion.
"Over the next 18 months, you're looking at an overall shortfall of $5 million in originally anticipated state aid," Champion said. "But that is assuming you get the benefit of the revenue from the changes the government is proposing."
To continue fighting these challenges, Curtatone created a special committee to advise the city on how the to handle its fiscal challenges. Tufts Professor of Economics Daniel Richards will serve on the committee along with four other local experts.
Although Somerville will utilize all of its resources to look at a full range of possibilities in terms of organizational changes and ways of increasing revenue, the city is in a relatively good position.
"There are plenty of other cities and towns that are looking to close their libraries and shut the doors," Champion said.
