The Secretary’s Message
Governor Patrick and Lieutenant Governor Murray ran for office in 2006 with a bold agenda for helping every resident and region of Massachusetts achieve prosperity, driven by individual initiative and private sector innovation, with targeted public investments helping to create the conditions for success.
It quickly became evident that the path to the full realization of that vision would be long and challenging. The Governor and Lieutenant Governor inherited a deep structural deficit, the highest per capita debt load in the country, and huge unfunded liabilities for public retirees. Moreover, fragmented governance and chronic underinvestment and inefficiency left too many of our roads, bridges and rail systems in a state of poor repair – and too many parts of Massachusetts lagging behind in access to infrastructure essential to unlocking economic development.
These problems were soon compounded by a global economic downturn, which caused our state’s tax revenues to drop by over $3 billion in just one year and removed over $20 billion in total from our revenue base (relative to typical tax growth) over the past four years.
Even with these daunting challenges, the Governor and Lieutenant Governor kept their rudder true. As opposed to indiscriminately slashing state spending to “check the box” on balancing the annual budget, they instead made the room in the budget to fund critical investments in the Commonwealth’s people and future. They provided historic levels of Chapter 70 K-12 education aid; doubled our capital investment budget; fully funded health care reform; jump-started life sciences research; and launched innovative programs to reduce youth violence.
Much of the budget space for these initiatives was derived from the Patrick-Murray Administration’s efforts to spend state dollars more wisely and efficiently. There has been a relentless focus and a string of successes on health care cost containment, procurement reform, and energy efficiency enhancements. There have been new performance management initiatives designed to get more out of the state workforce. And there has been incredible energy dedicated to reforms that improve the long-term fiscal picture of governments at every level, including pension reform, municipal health insurance reform, and transportation restructuring.
Far from standing pat, the Governor and Lieutenant Governor continue to push an aggressive agenda on these fronts. Just this month, they laid out a series of additional reforms to reduce redundant fees and unnecessary paperwork and bureaucracy for businesses, consolidate public housing agencies to realize efficiencies, and achieve up to $20 billion in savings in state and local retiree health care over thirty years so we can sustain good benefits for valued career public employees.
And throughout, the state budget has been balanced without gimmicks, and with the prudent use of reserves and federal fiscal aid for states. Even after fulfilling its intended purpose of cushioning the fiscal blow of major recessions, our Rainy Day Fund has been re-built to among the highest levels in the nation. The Patrick-Murray Administration’s budget filings themselves have been recognized as models of transparency and insight.
It is thus no surprise that we have emerged from the recession faster than most other states, and with the strongest credit ratings in our history. Massachusetts is moving forward. State government has been re-energized
Having said this, any honest assessment must recognize how far we still must travel to achieve our state’s great potential. I know this is Governor Patrick’s and Lieutenant Governor Murray’s view.
Our schools are the best in the nation – and that is not enough when we have additional opportunities to eradicate the achievement gap, make college more affordable, and get the very youngest among us off to a great start towards lifelong learning. Our economy is among the strongest of the states – and that is not enough when we can convert a patchwork transportation infrastructure showing the strains of age to a world-class system that fuels job creation throughout the Commonwealth.
This budget reflects the Governor’s and the Lieutenant Governor’s restlessness to tackle the unfinished business of promoting opportunity and prosperity in every corner of the Commonwealth – and I am extremely proud to help shepherd it forward with my team at the Executive Office for Administration and Finance.
The budget would begin a course of groundbreaking new investments in education, transportation, and innovation that will transform Massachusetts’ economy in the short-term and over the long haul – giving the people and employers throughout our state the complete set of tools they need to succeed.
It also maintains the strong foundation of public investments that have already made us nation leaders in student achievement, health insurance coverage, veterans’ services, energy efficiency and providing a safety net for our most vulnerable citizens.
And it is a fiscally sound budget. It employs fewer one-time resources than the FY13 budget, preserves our state’s Rainy Day Fund at over $1 billion, and is structurally solid based on credible, long-term fiscal modeling.
Undergirding these objectives is the proposed use of new tax revenues. This budget stands for the proposition that we must strive for more for the Commonwealth – and finance it honestly and sustainably. This requires raising additional revenues to support additional, high-yield public investments in education, transportation, and innovation. The revenue proposal included with this budget accomplishes these purposes in a way that improves the fairness of the tax code, protects our economic competitiveness and channels needed amounts to infrastructure.
We at the Executive Office of Administration and Finance are extraordinarily proud of the substance of this budget and – above all – so grateful to Governor Patrick and Lieutenant Governor Murray for supplying its vision and ambition. It is a privilege to work for leaders like them with big dreams, big hearts, and the courage to act on them.
We are also very proud of the appearance of this budget! It is offered in a new “program budget” format that makes it much easier to understand what taxpayer dollars in fact support – and will moving forward be the chassis for reporting on whether agencies have accomplished goals identified in strategic plans likewise released with this budget.
We would additionally like to extend our thanks to our colleagues throughout the Executive Branch who have helped us craft this budget recommendation. We similarly look forward to working with our counterparts in the Legislature on the enactment of a fiscal year 2014 budget in the months to come.
I personally want to express my deep gratitude to the team at the Executive Office for Administration and Finance for their incredibly hard work in helping to fashion this budget recommendation – and particularly for their efforts to help me get up to speed quickly (and their patience with me as I did so). Special thanks to Budget Director Michael Esmond for his leadership in assembling yet another superb product.
Finally, I am deeply indebted to former Secretary Jay Gonzalez for the support and encouragement he has given me in taking the helm at Administration and Finance and particularly in assisting with the crafting of this budget recommendation.