SalemNews.com, Salem, MA

December 6, 2012

Local aid cuts bring angst

N. Shore politicians react to governor's budget plan

By Alan Burke
Staff writer

---- — Gov. Deval Patrick’s plan to keep the state budget in balance with more cuts, including cuts to local aid, is getting a mixed reaction on the North Shore.

In Danvers, Town Manager Wayne Marquis said, the selectmen have already voted unanimously to urge their representatives on Beacon Hill to fight any cuts to the town.

“The thought local aid would be cut is unpleasant,” he said.

And he cites the reductions currently sustained locally in the wake of the recession — approximately $1 million — as well as the mounting, unfunded mandates placed on Danvers by Beacon Hill.

Beverly Mayor Bill Scanlon is more philosophical about the potential loss of revenue.

“I think when there are difficult times, we all have to share the pain,” he said.

Acknowledging that the Massachusetts Municipal Association is fighting the governor’s proposal, he said, “It’s a difficult thing. But I’m not prepared to fight it.”

A shortfall in state revenue, along with misgivings about the consequences of the fiscal cliff (the potential of large tax increases from Washington in January), are behind the governor’s decision. He is required to keep the state budget balanced. Some cuts he has made unilaterally, but others, including cuts to local aid, will require an assent from the Legislature giving him the temporary power to make them.

Whether this would happen prior to the seating of the new legislation in January remains uncertain.

With the fiscal year at roughly the halfway point, the state is short about $250 million of the revenue it was estimated to collect. Thus, the governor has calculated a shortfall for the entire year at $540 million. He anticipates dealing with it in part by withdrawing $200 million from the state’s billion-dollar-plus rainy day fund and making some cuts in executive departments.

Determining the exact amount slated to come from local aid depends on who you talk to, with the figure varying and rising as high as $35 million, according to House Minority Leader Brad Jones.

Opponents of the cuts won’t be happy in any case.

As Marquis points out, Danvers was “counting on $150,000 in state aid for the homeless children” who live in budget motels on Route 1 and Endicott Street and are sent, at town expense, to their original schools. That aid is likely to be slashed in half, and the expense represents an unfunded mandate on Danvers, he points out.

State Rep. Ted Speliotis, D-Danvers, hasn’t decided how he would vote if this comes before him. “It’s a matter of how much money do we have?” But he adds that the town shouldn’t necessarily be exempt from the cuts made at other levels of government. Further, he advises that cuts, if needed, will do less damage if done sooner rather than later.

The cuts made already on the executive level, cuts in things like mental and public health, also have an impact on his constituents, Speliotis points out.

Midyear cuts in local aid are always troublesome, said state Rep. Brad Hill, R-Ipswich, because cities and town have already mapped out their own budgets and are counting on the state contribution. He is denouncing the governor for putting communities in this position through reckless spending

Hill cites, for example, a decision a few weeks ago to give free tuition at state colleges to illegal aliens. Why implement such a program while “knowing full well” that the state is in financial trouble? he asked.

“Then there’s the cost of the drug law fiasco and the crime lab fiasco,” Hill said. A referendum question requires the state to set up medical marijuana dispensaries, while a crime lab employee was found to have falsified hundreds of results on evidence used in criminal court. “Because of that, we are going to have some issues that are going to cost the commonwealth hundreds of millions of dollars.”

State Rep. John Keenan, D-Salem, commends Patrick for starting a conversation on the need to address the problem.

“We’re a little behind where we need to be,” he said.

But a little behind becomes a much bigger problem, he indicated, if Washington fails to adequately address the impact of ending the Bush tax cuts and tax increases under President Barack Obama’s health care plan.

“These cuts are nothing if Congress doesn’t solve the fiscal cliff,” Keenan said.

Peabody Mayor Ted Bettencourt doesn’t offer a remedy, but said, “Any type of cut in local aid would be a concern on our part. ... In this economic climate, it’s something to be worried about.”

There’s a certain irony to all this, according to Marquis. The Danvers town manager notes that lately many of the economic indicators in his town were pointing upward, including building starts, excise tax and restaurant receipts. “We’re seeing signs in Danvers of an improving economy,” he said.