FY99H1A Local Aid

Fiscal Affairs Division

Local Aid

Cherry Sheet Aid (in Thousands)	Fiscal Year 1998 Estimated Spending	Fiscal Year 1999 Recommended Spending
Treasurer	1,086,863	1,123,651
Municipal Services and Abatements	25,377	24,930
Veterans’ Services	7,820	8,033
Libraries	22,905	22,905
Education	2,635,611	2,908,791
Public Safety	17,610	17,610
Transportation and Construction	43,472	43,472
Total:	3,839,658	4,149,392

Fiscal Year 1999 Cherry Sheet Overview

The Division of Local Services, within the Department of Revenue, annually notifies cities, towns, and regional school districts of the aid and assessments the Commonwealth will provide them in the upcoming fiscal year. These notifications were originally printed on cherry-colored paper, and were therefore given the name "cherry sheets."

In Fiscal Year 1999, cherry sheet appropriations will total $4.15 billion, providing cities and towns with a direct local aid increase of $309.7 million, 8% over Fiscal Year 1998 levels. This represents the seventh consecutive annual local aid increase, demonstrating the Cellucci Administration’s continuing commitment to the Commonwealth’s municipalities.

Cherry Sheet Spending Chart

CHERRY SHEET PROGRAMS

The direct local aid distributed to cities and towns through the cherry sheets is comprised of 28 line-item appropriations administered by a variety of state agencies and departments. These programs, and their Fiscal Year 1999 funding levels, are described below.

Treasurer and Receiver-General

In Fiscal Year 1999, additional assistance, teachers’ pensions, and the local share of the racing tax are funded at Fiscal Year 1998 levels. Payments-in-lieu of taxes for state-owned land is increased by $2 million. The distribution of lottery proceeds will increase by $34.7 million, continuing the Administration’s commitment to phase out the lottery cap and distribute the funds to cities and towns through the lottery formula. If the State Lottery Fund revenue growth exceeds current projections in Fiscal Year 1999, the additional increase will be distributed through the same formula at the end of the fiscal year.

Lottery Aid Spending Chart

Municipal Assistance

The Department of Housing and Community Development administers the Federally-Aided Urban Renewal, State Urban Renewal, and Urban Revitalization and Development Grant programs. These programs reimburse cities and towns for a portion of the costs related to urban renewal projects, which are targeted at redeveloping downtown areas, neighborhoods, industrial parks, and commercial zones. Fiscal Year 1999 funding for the Urban Revitalization and Development Grant program is level-funded at the Fiscal Year 1998 service level. Federally-Aided Urban Renewal and State Urban Renewal are being phased out and are, therefore, receiving decreased funding in Fiscal Year 1999.

The Commonwealth also provides reimbursements to cities and towns for tax exemptions granted to qualifying veterans, blind persons, surviving spouses, and elderly persons, as well as reimbursements for tax abatements. Fiscal Year 1999 funding for these reimbursements will provide the same level of support as in Fiscal Year 1998.

Veterans’ Services

The Office of Veterans’ Services, within the Executive Office for Administration and Finance, administers veterans’ benefits programs, which reimburse cities and towns for 75% of the costs of benefits for veterans and their dependents. These benefits include assistance for food, clothing, shelter, heat, medical, and burial expenses. Fiscal Year 1999 funding will ensure that service levels can continue at Fiscal Year 1998 service levels.

Board of Library Commissioners

The Board of Library Commissioners oversees two cherry sheet programs: aid to local public libraries and aid to regional public libraries. The state aid distributed through these two programs assists municipalities in providing free library services at local libraries and defraying the costs of regional public library services. With state aid, regional libraries are able to provide support services to municipal libraries, including interlibrary loans, research and reference searches, and the delivery of materials between libraries. The Fiscal Year 1999 funding level for libraries is equal to the Fiscal Year 1998 funding level.

Education

The cherry sheet contains aid for several education programs. Fiscal Year 1999 total cherry sheet education funding will increase $273 million over Fiscal Year 1998 levels. Direct financial assistance distributed to school districts through the Education Reform formula will increase by $253 million, continuing the Cellucci Administration’s commitment to fully fund the sixth year of Education Reform. School Building Assistance reimbursements, which provide municipalities and regional school districts with financial assistance for the planning and construction of school buildings, will increase by $25 million. Additionally, the Commonwealth will increase Fiscal Year 1999 funding for professional development by $7 million, and for the cost of public tuition for pupils who reside in foster or group care under the Department of Social Services by $500,000.

Public Safety

The Executive Office of Public Safety administers the police career incentives program, through which the Commonwealth reimburses cities and towns for 50% of the costs associated with providing incentive education programs to police officers. These incentives are offered in the form of salary increases as the officers earn undergraduate and graduate degrees. The Fiscal Year 1999 recommended funding will equal the Fiscal Year 1998 funding level.

Transportation and Construction

To reimburse municipalities for costs incurred in the construction, maintenance, and policing of local streets and roads, the Commonwealth distributes Highway Fund monies (funded through the motor vehicle fuels excise tax) to the 351 cities and towns in Massachusetts. In Fiscal Year 1999, Highway Fund distributions will equal Fiscal Year 1998 distributions.

NON-CHERRY SHEET LOCAL AID

The Cellucci Administration pursues a comprehensive local aid policy to ensure the fiscal autonomy and stability of each city and town in the Commonwealth. To achieve this goal, there are local aid programs that the State administers in addition to those programs which appear on the cherry sheet. These programs provide either programmatic assistance or direct monetary aid to communities, and like cherry sheet aid, are an important part of the Administration’s effort to support the delivery of quality local services. In Fiscal Year 1999, the Administration will continue its commitment to local aid by increasing funding for education, transportation, the Judiciary, the District Attorneys and public safety, and water and sewer assistance.

Education

In addition to the education aid distributed through the cherry sheet which was discussed in the previous section, the Cellucci Administration is undertaking several important expansion initiatives which will further increase the Commonwealth’s investment in education.

The Administration recommends $40 million in funding for a new program to increase the number of teachers in school districts with high student-to-teacher ratios. To support the Charter School Act of 1997, the Administration is recommending an additional $16 million in funding. This funding will reimburse districts for the tuition costs of students who choose to attend charter schools. The Administration is also recommending $15 million in expansion for the Early Education and Care program, which is a 23% increase over Fiscal Year 1998. The Department of Education will use this funding to enhance the educational quality of child care programs in the Commonwealth. Finally, the Administration recommends $5 million in additional funding to expand the number of after school programs for at-risk youth.

Transportation

In Fiscal Year 1999, the Administration requests $1.4 million in funding for a lease program to assist transit carriers with the purchase of buses as part of the Inter-City Bus Capital Assistance Program. This program will enhance the availability of transportation for residents who live in communities which are not served by the Massachusetts Bay Transportation Authority. In exchange for the state lease, transit carriers will agree to maintain bus routes in otherwise underserved areas.

Judiciary

The Fiscal Year 1999 budget recommendation for the Judiciary is $499.8 million, a $15.63 million increase over Fiscal Year 1998 projected spending. This recommendation includes funding for the operational expenses of new court facilities in Boston and Lawrence, $13.32 million to complete the expansion of the juvenile courts in 38 cities and towns, and $4.64 million for the maintenance of court facilities in the former Worcester and Hampden counties.

District Attorneys and Public Safety

The Cellucci Administration’s strong commitment to safeguarding the Commonwealth’s communities is reflected in the recommended $2 million increase in funding for community policing grants to cities and towns, an 11% increase over Fiscal Year 1998. Additionally, the Administration recommends an 8% increase in funding for the District Attorneys, which is $5.2 million more than projected Fiscal Year 1998 spending.

Water and Sewer Assistance

In Fiscal Year 1999, the Cellucci Administration will continue to support the financing of local water and sewer improvement projects. This budget provides $10 million in new funding for municipal drinking water project assistance, and $31 million for the continuation of clean water project assistance, an increase of $4 million dollars over Fiscal Year 1998 projected spending.

In addition, for the sixth year in a row, the Commonwealth will fund a water and sewer rate relief program. Previous efforts have dedicated over $207 million in state funds to the Massachusetts Water Resources Authority and other local water and sewer authorities to offset the financial burden on rate payers. Since the program began in Fiscal Year 1994, state assistance has decreased residents’ annual sewer rate increases from an average 24% in Fiscal Year 1993 to slightly over 3% in Fiscal Year 1999. The Fiscal Year 1999 recommendation for water and sewer rate relief is $55.7 million, an increase of $5 million over Fiscal Year 1998 projected spending.

Executive Office for Administration and Finance
Fiscal Affairs Division
State House, Room 272
Boston, MA 02133
(617) 727-2081

Last updated on January 25, 1998