Connecticut
Democratic Gov. Ned Lamont delivered a two-year budget plan of $43.1 billion to lawmakers, emphasizing that the state’s crushing fixed costs relative to its pension funds must be addressed. To accomplish this, he proposed restructuring, refinancing the systems’ payments and slowing the rate of increase in the teachers’ pension fund and the state employee pension fund, both of which are underfunded. Lamont also stated he will eliminate the multibillion dollar shortfall he inherited, without raising the state’s income tax.
Lamont announced that for the first time, cities and towns will be asked to contribute $73 million toward municipal teachers’ pension funds. At the same time the governor will provide cities and towns with an extra $65 million in Education Cost Sharing grants.
The governor’s budget calls for new taxes and fees by eliminating previously exempt goods and services including:
- professional services including legal, accounting, interior design and real estate
- personal services, including dry-cleaning, barber shops, beauty shops, veterinary services, parking, sport and recreation instruction
- other services and goods, including property repairs and renovations, winter boat storage, non-prescription drugs, vehicle trade-ins, newspapers and certain magazines.
Lamont indicated he is open to legalizing and taxing marijuana and putting fees on sports betting. The governor’s budget also includes plans for instituting tolls that would apply to all vehicles.
The budget includes a minimum wage increase to $15 over four years, going from $10.10 to $11.25 in 2020, to $12.50 in 2021, to $13.75 in 2022 and finally to $15 in 2023.
The governor has also included $5.2 million in startup funds for a family medical leave program, which would be funded with a 0.5% payroll contribution. The plan would provide 12 weeks of coverage.
Maine
The two-year $8.03 billion spending package proposed by Democratic Maine Gov. Janet Mills represents an 11% increase over the prior two-year budget. The largest increase, $177 million, would fund Medicaid expansion, providing an additional 70,000 Mainers with health insurance. Mills made a campaign promise to Maine voters to fund the expansion, which former Gov. Paul LePage refused to do despite approval of the expansion by Maine voters.
The next largest increase in the Mills budget is for K-12 education, which is slated to receive an additional $126 million over the previous two-year budget cycle. The budget also provides that no Maine public school teacher will earn less than $40,000. Maine currently pays teachers an average of $33,000.
Mills also increased spending for the University of Maine System, which will expand the university’s capacity to address critical state workforce needs. Base funding for the system will increase from $189 million to $204 million in fiscal 2021. The budget also provides for $3.1 million to expand Early College enrollment, enabling high school students to explore careers that lead directly to job opportunities in areas such as healthcare, public safety and computer science. An additional $4.1 million will support Adult Degree Completion.
Maine’s public universities are partners of MaineSpark, a coalition of schools, universities, nonprofits, foundations, government agencies and businesses with a common goal of providing 60% of Mainers with education and workforce credentials by 2025.
Massachusetts
Gov. Charlie Baker presented to lawmakers a $42.7 billion budget for fiscal 2020, which represents a 1.5% increase over the prior year’s budget. Baker’s spending plan is built in part on $133 million in tax revenue from recreational marijuana sales. Adding to the revenue stream is an additional $42 million, which would come from a sales tax on online marketplaces like eBay, Etsy and others. A tax on e-cigarettes and vaping products is estimated to bring in another $6 million. The governor also anticipates $35 million in revenue from proposed legalization of sports betting, which would be deposited in the Gaming Local Aid fund. The budget builds in one-time revenue from a new sales tax collection modernization program for the Commonwealth’s largest vendors (those vendors that have remitted at least $100,000 in sales taxes in the prior year) that would shorten the time between collection and remittance. The revenue would be used to support one-time needs related to education, including investments in college scholarships, school safety and to assist school districts in eliminating lead from school drinking water.
Baker’s budget addresses the Foundation Budget Review Commission’s recommendations by overhauling the current state education formula with the biggest single change to the K-12 budget providing an additional $262 million in Chapter 70 state aid. The governor’s plan features full funding of foundation and base aid requirements; for health care including benefits for retirees; for educating English language learners; for districts with the highest number of economically disadvantaged students; minimum aid level of $20 per pupil for all school districts; helping school districts to meet out-of-district costs associated with special education costs; for students in Early College and Career Pathways.
For higher education, the governor’s budget includes a 5.5% average increase for campus operating budgets with a 7.5% increase for UMass, a 4.4% increase for the state universities and a 3% increase for community colleges.
A new initiative, the College Affordability and Student Success Trust Fund ($100 million), would give financial help to students enrolled at Massachusetts public colleges and universities to reduce college costs, provide greater opportunities to earn college credits and participate in paid student internships, beginning in fall 2020. Revenue for the trust fund would come from the Baker administration’s sales tax modernization proposal. It would also fully fund Commonwealth Commitment, and tuition payments for Early College while establishing a matching grant program for paid internships at 2-year and 4-year public institutions.
New Hampshire
Republican Gov. Chris Sununu budget message for fiscal 2020 and 2021 was highlighted by investments in social services and education. The two-year spending package of $13 billion contains no new taxes. It includes funding of $40 million for a new 60-bed forensic unit at New Hampshire State Hospital, $60 million to be invested in services for the developmentally disabled, which would address a huge backlog of people waiting for services and enabling legislation for a two-state initiative with Vermont for paid family medical leave. The spending plan fails to increase Medicaid rates, which are among the lowest in the nation.
The budget provides $64 million for targeted school building aid for the state’s poorest school districts. The per-pupil cost stays at $3,636 per student. Schools get an additional $1,818 for every low-income student, and $1,956 for special education students. English language learners get $711. Also funding for special education will be increased by 20%. An additional $8.6 million is targeted for tuition and transportation to help high school students travel to community colleges as part of the New Hampshire Career Academy.
For higher education, the governor’s budget includes $32 million over two years for a new loan-forgiveness program to encourage college graduates to work in the state.
The University System of New Hampshire is level-funded at $81 million for each year. Community colleges would receive a $1 million increase for each year. The governor’s budget targets investments in the UNH system, including $24 million to expand the capacity of healthcare and nursing programs and $10 million for the first phase of a Biological Sciences initiative.
Rhode Island
Democratic Gov. Gina Raimondo presented her budget plan of $9.9 billion, which represents a 3.7%, or $357 million increase over fiscal 2019. There are no changes to the rates for broad-based taxes, including the sales tax, the income tax and the corporate tax. That being said, the governor expands the sales tax to digital downloads of video, music and e-books (including Netflix) as well as Amazon Marketplace orders. The tax and fee changes are part of a plan to address a $200 million shortfall. Sin taxes will see a hike with the cigarette tax being raised to $4.50 along with a new tax on e-cigarettes. Fees will increase, including a Department of Motor Vehicle technology fee and Department of Environmental Management fees for beach parking and camping. Also, the governor proposes a surcharge on guns and ammunition.
With the U.S. Supreme Court’s decision to legalize sports betting, Rhode Island launched sports betting at Twin River Casino in November 2018. The budget expands sports betting by incorporating legislation proposed by Senate President Dominick Ruggerio to permit sports betting online, provided the player registers in person at Twin River and has a physical presence in Rhode Island when placing a bet. The online feature is anticipated to generate approximately $3 million out of a total $30 million from sports betting.
The budget proposes legalizing marijuana for adult use, which would be regulated by creating an Office of Cannabis Regulation. Six additional compassion centers would be added the existing three centers while restricting homegrown medical marijuana. Changes in pot policy are expected to generate $6.5 million beginning in January 2020.
The governor’s budget for education increases funding for K-12 by $30 million. It also increases the phasing in of PreK classrooms with $10 million to maintain current PreK classrooms and expand classrooms, and $2.25 to $5 million in dedicated funding for English Language Learners.
For higher education, the governor proposes an expansion of the Rhode Island Promise Scholarship/free tuition program. Adults age 25 or older who are attending the Community College of Rhode Island either full- or part-time, would be eligible. In addition, a new scholarship would be established to cover the third and fourth year of tuition at Rhode Island College. Those who would be eligible include students who are currently sophomores or juniors. The scholarship expansion is estimated to cost $13 million in 2019-20.
The budget also includes a plan to provide minimum standards for health insurance for Rhode Islanders and would mandate Rhode Islanders to have health insurance by Jan. 1, 2020 or pay a penalty or tax of $695 or 2.5% of household income.
Vermont
Republican Gov. Phil Scott presented a $6.1 billion spending plan for fiscal 2020. The budget represents a 4% increase over the previous year. After refusing to raise taxes in his first two years as governor, Scott proposed some new taxes and fees. He would increase fees by $8.5 million, most of which would come from increases on stockbrokers, mortgage lenders and other financial services professionals. Additional revenue would come from taxes on online purchases. He wants to raise $10 million by expanding the sales tax to online purchases and would increase the tax on electronic cigarettes, online hotel room taxes and online booking services such as Airbnb and Booking.com.
Scott noted Vermont’s biggest challenge to economic growth is its aging population. He proposed approximately $4 million to attract new workers to the state and would provide relocation grants for workers considering a move to Vermont. Starting in 2019, those who move to Vermont and work remotely for an out-of-state employer will be eligible to receive $10,000 over two years from the Vermont government to cover expenses such as relocation fees, a co-working space, a computer or Internet connectivity
The governor is asking for a $7 million increase for the Child Care Financial Assistance Program, which would raise subsidy levels for low- and moderate-income families. Scott is also asking for $2 million for the Department of Children and Families to add more family service workers and resource coordinators to serve at-risk families.
With regard to new spending, Scott is asking for $1.5 million to provide grants for “last mile” broadband connections and to increase broadband access to “underserved” communities.
The budget also calls for $1 million for the Vermont Student Assistance Corporation to fund a “non-degree” grant program that adults can pursue as an alternative to college. Also, the budget for Vermont state colleges would be increased by $3 million, an amount Scott says he would allow eliminating a 3% tuition increase slated to begin in the fall.
Other budget items include using $1.5 million from the Volkswagen settlement to subsidize the state’s fleet of electric vehicles and provide more charging stations.
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