From the Big City:
The Massachusetts Bay Transportation Authority is facing a new, more severe version of its all too familiar budget deficit in the 2027 fiscal year, which starts this July.
This July the MBTA will be facing a $560 million budget deficit, with the following year projected to be a $732 million deficit. These projections were shared by the MBTA in a public meeting last week.
Many factors play into the MBTA’s budget deficit, but principal among them was the failure of the state to follow through on the governor’s proposed stopgap funding from higher than expected “fair share” revenue generated from the state’s millionaires surtax.
The MBTA expects to end the current 2026 fiscal year with a shortfall of $239 million as a result. The agency plans to use a portion of its rainy day fund to close this year’s budget gap.
“Gov. Maura Healey had sought to buck up the T’s finances for a sustained period last year when she proposed an infusion of $687 million, using the proceeds from the state’s new tax on millionaires. However, by the time the Legislature passed a new spending plan, that amount was whittled down to $470 million,” said Jaime Moore-Carrillo in the Boston Globe.
The state has long given the MBTA 1% of all sales tax revenue, however the tax has never raised the levels of funding projected by the state. Since the year 2000 sales tax revenue has only grown 3.3% overall.
By contrast, the state has underestimated “fair share” revenue every year it has been collected. The states revised its forecasted “fair share” revenue to go up by $300 million in FY2027, equalling an 11% increase from its previous estimate, according to StreetsBlog Mass.
The Fair Share Law passed by voters in 2022 has strict requirements that the funds raised can only be used for education and transportation programs throughout Massachusetts.
The MBTA is one of only the many regional transportation agencies around the state that receives a portion of these funds, though the MBTA has historically received the lion’s share of the transportation “fair share” revenue.
Commonwealth Education:
Boston Public Schools have implemented a partial hiring freeze after projecting a $53 million budget deficit in the upcoming fiscal year.
“While it is typical for the district to anticipate and manage a deficit at this stage of the budget cycle, this year’s shortfall requires immediate action and a strategic plan to address it,” Superintendent Mary Skipper wrote in a memo, according to the Boston Globe.
Skipper blamed a number of factors for the upcoming budget deficit including transportation costs, inflation and a higher than expected number of vacancies being filled.
The Boston School Committee approved a $1.58 billion budget for the current fiscal year which was a 3.5% increase over the prior fiscal year.
The FY2026 budget came at a time when BPS stopped receiving federal funds from the Elementary and Secondary School Emergency Relief Fund and with the state improvement plan expiring in June — though a number of the issues addressed by that plan have not been resolved, according to the Boston Globe.
Read All About It:
- Illegal parking was at the top of Boston 311 as the most frequent complaint last year. The 311 system is how the City of Boston fields complaints from residents on issues like trash, rodent sightings and pot holes.
According to the Boston Globe, the vast majority of complaints to the city came from illegal parking. Residents who the Globe spoke to were frustrated with people parking nearly anywhere they felt there was space.
- The State Senate rejected Mayor Michelle Wu’s tax proposal which would have allowed the city to shift a higher property tax burden to commercial real estate and away from home owners.
The senate instead approved a measure that would allow cities and towns to offer tax rebates to homeowners in years where property tax rates increased over 10%, according to NBC Boston.
