- Budget Message
- Issues in Brief
- Budget Recommendations
- Local Aid to Cities and Towns
Local Aid Overview
Aid to cities and towns, or local aid, represents approximately 14.6 percent of the Commonwealth’s annual budget. In FY 2014, local aid programs account for $5.57 B, which reflects the Patrick-Murray Administration’s unprecedented commitment to a strong partnership between the state and its cities and towns.
Budgeted Local Aid
The Governor’s FY 2014 budget supports a total of $5.57 B in local school aid, general government aid and program-specific aid. This represents an increase in total funding support to the Commonwealth’s cities and towns from FY 2013 estimated spending of $265M (5 percent). Local aid is categorized with the programs that impact a municipality’s “Cherry Sheet,” the vehicle used by the Commissioner of Revenue to notify municipalities and regional school districts of estimated state aid to be paid and charges to be assessed over the next fiscal year. Below is a summary of funding for local aid cherry sheet accounts:
|Account Name||FY 2013
|Section 3 Aid|
|Chapter 70 Education Aid||4,171,079,892||4,397,257,302|
|Unrestricted General Government Aid||898,980,293||898,980,293|
|Annual Formula Local Aid||31,010,197|
|Cherry Sheet Aid|
|Tax Reimbursement for Vets, Blind, Widows||25,038,075||25,038,075|
|State Owned Land||26,270,000||26,270,000|
|Regional Library Local Aid||9,231,475||9,231,475|
|Municipal Libraries Local Aid||6,823,657||6,823,657|
|Local Share Racing Tax||1,150,000||0|
|Regional School Transportation||44,521,000||44,521,000|
|School Food Services Program||5,426,986,||5,426,986|
|Charter School Reimbursement||70,454,914||80,270,928|
|% Change from Prior year||5%|
- Level funding of State Owned Land (PILOT);
- Library Aid is level is funded at the FY 2013 estimated spending level of $16 M;
- Regional School Transportation is funded at the FY 2013 estimated spending level of $44.5 M;
- Charter School Reimbursement is increased by $9.8 M from the FY 2013 estimated spending level of $70.5 M;
- Tax reimbursements to veterans, the blind, and widows is funded at $25 M;
- Caseload-driven increases to Veterans’ Benefits brings the account to $48.3 M for FY 2014;
- The Department of Veterans’ Services (DVS) will maintain its FY 2013 policy of 100 percent reimbursement to cities and towns for the costs they incur providing homeless shelter benefits to veterans – in FY 2013, the total reimbursements to cities and towns for this service exceeded $888,000.
Section 3 of the Commonwealth’s budget provides each of the 351 cities and towns with the amount of local aid they are expected to receive from the state General Fund and other dedicated revenue sources.
Protecting Education Reform
One of Governor Patrick’s four priorities is closing the achievement gap in our schools, and the FY 2014 budget reflects strong support for education programs. In FY 2014, K-12 Chapter 70 funding is allocated at $4.39 B, the highest level of state K-12 education funding in history and a $226 M increase over FY 2013; this investment will ensure that the reforms initiated in the 2007 Reforms to Chapter 70 are fully implemented and funded. This increased funding will also account for the following factors in the Chapter 70 funding allocation to local educational authorities:
- All districts are fully funded at foundation levels;
- All districts will receive at least an increase of $25 per pupil;
- Districts will calculate Out of District Special Education at $35,000 per year, an increase of $25,000 per year in prior years to appropriately compensate districts for the costs of providing special education; and
- Elimination of the cap of pre-kindergarteners included in enrollment for Chapter 70.
In addition to this $4.39 B, the special education circuit breaker will allocate $230 M directly to municipalities.
Local Aid Reform
Unrestricted General Government Aid (UGGA) will be funded at $899M, the same amount and same distribution provided for in the FY 2013 GAA.
An additional $31 M in local aid will be distributed to all municipalities through the new “Annual Formula Local Aid” program. The existing allocation of local aid among the Commonwealth’s cities and towns (UGGA) is meant to maintain year-to-year consistency regardless of changes in a municipality’s circumstances and is no longer based on a rational funding formula. Annual Formula Local Aid addresses these critical aspects of a rational local aid program:
- Provides a simple and transparent formula using a combined measure of property values and income to calculate each municipality’s relative ability to provide essential local services; and
- Will consistently provide equitable distributions into the future, as each year the formula components will be updated and the total distribution of aid will be calculated using the updated components.
The schedule on the following pages provides the community-by-community allocation of local aid for UGGA and Annual Formula Local Aid as well as Chapter 70 school aid to support K-12 funding for the state’s local school districts.
Initiatives for Fiscal Year 2014
Throughout government, Governor Patrick is making innovation to improve customer service and efficiency a priority. Consistent with that focus, the administration has developed the following tools to assist communities.
Incentive Aid for Local Government Performance
A new program of incentive aid will reward municipalities for fiscal stewardship and performance, in line with initiatives of the Patrick-Murray Administration to change the way government does business. Incentives announced early in FY 2014 will focus on strong fiscal management, municipal health care cost reform, and local government performance management. Municipalities will have a full year in which to meet the incentives before incentive aid is provided for in the FY 2015 budget and distributed early in FY 2015.
One-Stop Grant Index for Municipalities
The Administration is developing a new one-stop listing of state grant programs for cities and towns. Municipal officials seeking opportunities for state resources to support local initiatives will be able to find these resources without needing to search state agency by state agency.
Citizens Connect Smart Application
Citizens Connect is the City of Boston's award-winning effort to empower residents to be the City's "eyes and ears." Residents can alert the City of Boston to neighborhood issues such as potholes, damaged signs, and graffiti using a smart phone app that identifies the location of the issue and alerts the City of the complaint. Funded through the CIC Grant Program and led by the City of Boston, this project adapts the Citizens Connect Smart App used by Boston into a tool for municipalities of any size and will implement this tool in more than 30 municipalities of all sizes across the state at no initial cost as part of a pilot program. Additional municipalities will be able to purchase the Citizens Connect Smart App at a much-reduced price.
State Support for Municipal IT Challenges
The Administration will partner with local governments to address various local government information technology (IT) challenges, by leveraging existing state resources needed by communities and sharing expertise. Activities include:
- Developing a series of IT models for the benefit of local governments, based upon successful IT-focused CIC Grant projects;
- Promoting the Springfield Data Center (SDC) to municipalities;
- Establishing a State-Local IT Committee to develop working relationships and identify new opportunities; and
- Developing and marketing an IT “toolkit” of services that the state can provide to municipalities.
Geographic Information System (GIS) Services
New MassGIS municipal planning and mapping services and online tools for municipalities will give municipalities increased functionality and eliminate the burden on municipalities to purchase and manage their own GIS systems.
Municipal Purchasing Assistance
The Operational Services Division (OSD) is developing statewide contracts which specifically assist municipalities by achieving aggregated savings on large procurements, eliminating the need for individual bidding processes, and providing long-term, competitive contracts never before managed on a statewide level. Identifying common needs and aggregating purchasing power at a statewide level is becoming increasingly attractive to our cities and towns as funding remains scarce, staffing decreases and the need to save taxpayer dollars while obtaining the best goods and services possible remains the goal and commitment of all communities.
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