Governor Healey announces budget cuts amid $1 billion shortfall
BOSTON - Governor Maura Healey announced she will chop $375 million from the state budget. It is an effort to combat a $1 billion shortfall in the 2024 fiscal year.
State officials say the cause of the shortfall is tax revenues that were lower than projected. Tax revenues were lower for the past six months, $769 million below the benchmark.
The largest cut comes to Mass Health fee for service payments. Other cuts will be made to earmark for local non-profits.
This comes just a few months after Governor Healey signed $1 billion in tax cuts into law. She also sought $250 million to tackle the state's emergency shelter crisis and is expected to ask for more.
Healey's Secretary of Administration and Finance Matthew Gorzkowicz says the state can do both, cut taxes and cut the budget.
"Those tax cuts are important in terms of providing relief to many residents in Massachusetts," Gorzkowicz said.
He also said that the emergency shelter crisis, which the Healey administration estimates costs $1 billion, is not the cause of the budget shortfall.
"The pressures on the emergency shelter system are not at all impacted by the underperforming revenues. The action we are taking today to balance the budget is the result of underperforming revenues. We have identified resources available to deal with the emergency shelter system," he said.
Democrat State Senator Jamie Eldridge argues that the state may have to rethink its tax cuts in order to ensure a balanced budget.
"The tax changes that we passed haven't even been implemented so this shortfall is from just mostly reduction in capital gains revenue which tends to be pretty volatile. So, this concern I have is that actually, this could be even worse. That once the tax reform changes go into effect, our revenue reductions could be even worse," Eldridge said.
