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Executive Summary

Through this executive summary, the Senate Committee on Ways and Means provides highlights of its fiscal year 2007 budget recommendations which focus on building a better future for the Commonwealth.

Local Aid

There is no question that the Commonwealth’s 351 cities and towns have struggled financially over the past several years. It is essential that reinvesting at the local level is a top priority. In order to facilitate that investment, the Committee’s recommendations include substantial increases in the area of local aid.

Lottery Aid

In response to the state’s continuing recovery from the fiscal crisis of past years, the Committee recommendations “uncap” the lottery revenue distribution. All of the state’s share of lottery profits will be distributed directly to cities and towns, resulting in a $158.7 million in increase in aid to municipalities.

Payment in Lieu of Taxes

To reimburse communities which host state land, these recommendations increase Payment in Lieu of Taxes Payments (PILOT) by $9.2 million for a total of $25.3 million. This funding will enable cities and towns with state-owned land within its borders to recover more of the property tax revenue they have recently been unable to collect.

Chapter 70

The Senate Committee on Ways and Means’ recommendations for Chapter 70 funding in fiscal year 2007 take an important step forward in addressing issues of equity and adequacy in education spending. Aided by the work of the Senate Task Force on Education Finance in 2004 and the Joint Committee on Education’s listening tour, our plan will provide immediate help to school districts and create a framework of reform that can be built upon in future years. In addition to structural changes, the Committee is recommending an increase in Chapter 70 aid of more than $210 million over fiscal year 2006, and maps out a commitment over the next five years.

The Committee’s plan makes targeted increases to the foundation budget and works to ensure fairness in the calculation of state aid and local contributions. Changes to the foundation budget will better reflect actual district need and spending. To gain a more accurate picture of municipal ability to pay, aggregate income and property values are weighed equally. Additionally, the plan guarantees that, over five years, each school district will receive state aid amounting to at least 20 percent of its foundation budget. Finally, the plan increases both the assumed in-district special education enrollment as well as the per-pupil allotments for English language learners and students from low-income families.

Education