United States: FY2016 Massachusetts Budget Update: The Conference Committee Budget

After many weeks of deliberation, the Massachusetts House and Senate sent a budget to Governor Baker's desk. This budget passed the Senate 31-5 and the House 153-1 and represents a compromise between the House and Senate versions, described in previous ML Strategies advisories. A conference committee aimed to resolve discrepancies between the two chambers and in doing so went past the June 31st deadline for the fiscal year. This required a $5.5 billion stop-gap funding measure, which is currently in effect and has kept the state government funded since the end of FY15 on July 1st.

The budget approved by the legislature totals $38.15 billion for FY16 and represents a 3.5% spending increase, lower than the projected 4.8% increase. While this reduced spending rate may surprise some in a year of record tax revenue, it comes after lawmakers struggled to close a $1.8 billion inherited budget deficit. Below, we have highlighted several key areas in this budget that address disagreements between the House's, Senate's, and Governor's initial proposals.


  • The legislature has given Governor Baker many of his requested MBTA reform measures, in line with both the House and the Governor's budgets. This includes a three-year suspension of the "Pacheco Law," which required that the state Auditor certify that any privatization plan will save costs without reducing services. Many consider this requirement excessively restrictive. Others believe that it protected jobs. This provision generated the majority of the opposition to the conference budget in both chambers.
  • Also included in MBTA reform is a new five-member fiscal and management control board to oversee the T, which will aim to reduce costs for the transportation system. The legislature, however, adjusted the Governor's proposal slightly to integrate the board with preexisting transportation governance.
  • Other measures in this budget include giving the Secretary of Transportation the ability to hire an MBTA general manager and an increase in the size of the state Transportation Board. A separate transportation bill is also under consideration this session.

Health Care

  • The budget excludes a controversial initiative directing MassHealth, the state implementation of Medicaid, to contract with a health provider to establish an "accountable care organization." This would have allowed MassHealth to contract with a health care network to provide care for a certain population. Hospital networks such as Steward's advocated for the provision as a cost-saving measure, while current health plan providers accused the provision of creating insurance companies without the requirement of carrying insurance licenses.
  • The conferees created an oversight board for the Center for Health Information and Analysis (CHIA). This independent board consists of industry and government stakeholders and matches language in the Senate budget.
  • The budget excluded supplementary funding for "Disproportionate Share Hospitals." This money, which aids hospitals that serve large numbers of uninsured and low income patients, appeared in the FY2014 and FY2015 budgets but was dropped in the Governor's initial budget proposal for FY16.
  • The conference committee excluded language that would have increased income eligibility requirements for home health care assistance. Advocates for this provision, such as Senate Ways and Means Chair Karen Spilka, had claimed the state would save money by reducing nursing home entry rates.
  • Other drug treatment measures in this budget include $3 million for 250 new clinical stabilization beds to treat drug addicts, a bulk overdosing drug purchase program, and two new high schools specifically for youth recovering from addiction.


  • The budget increased local aid by $34 million and education aid by $111.2 million.
  • The budget includes a 4% increase in funding for the University of Massachusetts system, although most believe attendance fees will still increase next year. The budget also allows the UMASS system to directly retain tuition revenue, rather than returning it to the general fund.

Economic Development

  • The Massachusetts Life Sciences Center is funded up to $10 million, down from last year's funding cap of $25 million. The Governor's budget and the House budget originally defunded the Center while the Senate budget funded it to $15 million.
  • The budget includes a provision banning any use of public funds to support the proposed Boston 2024 Olympics without the specific permission of the legislature. Opponents of the Olympic bid claim this provision leaves major loopholes that could end up permitting public funding of the games.
  • The conference committee provided $1.1 million in funding for the Massachusetts Capital Access Program, a successful small business loan program. Over the past 20 years, the program has provided over 5,000 loans to businesses with less than $5 million in revenue.

Tax Policy

  • The film tax credit remains in the budget despite the Governor's push to use those funds to pay for an Earned Income Tax Credit increase. Speaker DeLeo and other lawmakers defended the tax credit as a mechanism for job creation.
  • Despite retaining the film credit, the legislature has opted to expand the Earned Income Tax Credit for low-income families by 23%. They will pay for that expansion by eliminating a never-enacted tax cut for businesses, FAS-109. The Governor supports the legislature's alternative funding method, commenting that "I think that's a good thing and I don't believe it's a tax increase." Business groups such as the Massachusetts Taxpayers Foundation, Associated Industries of Massachusetts, the Greater Boston Chamber of Commerce, and the Massachusetts Business Roundtable have urged the Governor to veto the FAS-109 repeal.
  • The budget empowers the Commissioner of Revenue to institute a Tax Amnesty program in FY2016. This will allow taxpayers with outstanding liabilities to pay their tax debts at face value without the additional penalties that they would otherwise incur.
  • The conference committee rejected the Senate's plan to freeze state income taxes at 5.15%. This mans the tax will drop to 5% in the near future as a result of preexisting laws. The Senate proposal faced legal controversy from the beginning and required a ruling from the Supreme Judicial Court designating the budget a "money bill" so that the Senate could attach tax-related amendments such as this.

The Governor now has 10 days to sign the bill and issue line item vetoes. The House and Senate can then override any of these vetoes with a two-thirds majority vote in each chamber. The state leaders have until July 31st to finalize an FY16 budget before the current interim budget runs out.

* * *

ML Strategies will continue to monitor the budget process and report on the remainder of the process.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Max Samels
In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.