Study shows unfunded mandates remain a challenge for cities and townsDate: 10/25/2022 I’ve not heard many candidates speak about this issue this election cycle. Perhaps it’s considered too much “inside baseball,” for the general electorate, but unfunded or underfunded mandates from the commonwealth to cities and towns is one of the ongoing headaches for municipalities.
Outgoing state Auditor Suzanne Bump has detailed the gap between expectations and reality in a new report that shows our communities are not getting what they should be getting to accomplish the directives of the state.
Now, this is nothing new and the phrase “unfunded mandates” has been a rallying cry for elected officials for years.
Springfield, for instance, struggled for years to get the money the city needed from the state to reimburse it for school transportation.
One would think, however, with state representative and state Senate races going on – much less the statewide races – this would be an essential talking point, especially in light of inflation and other pressing concerns. It’s clear, though, that either hot-button talking points or boring generalities have made up too much of the political conversation this election cycle.
Bump wrote in the introduction of the report: “State assistance is a critical lifeblood for municipal finance in Massachusetts. Funds for education, general aid and reimbursements support over one-fifth of budgets of local communities. For some communities, state aid is the largest category of revenue, but overall, it is the second biggest following the property tax levy. Additional assistance comes from a variety of grant programs, typically discretionary, whereby the state helps communities invest in schools, water and sewer systems, libraries and other municipal services.
“Even with the volume of assistance available, there are commitments and authorizations under state law that are not fully kept by the commonwealth. For example, school transportation monies for most programs are promised but fall short, some by design and some by formulae that require local participation. A few programs are fully funded, such as the school transportation mandate for students in families suffering homelessness. Some formulae for reimbursement are capped at arbitrary reimbursement levels that vary widely. Other categories of reimbursements are not explicitly visible to municipalities and school districts but are instead included in larger, broader funding formulae, such as the Chapter 70 education formula.”
Although Bump does note some progress – “Recent developments, however, have been very encouraging. The Legislature’s [fiscal year 2023] budget, which was signed by the governor on July 28, 2022, represents a big step toward a closer partnership between the commonwealth and its municipalities and school districts. The budget provides significantly higher funding in many of the categories of concern for this report, most notably a $500 million increase in Chapter 70 school aid due to the phase-in of the provisions of the Student Opportunity Act (SOA) of 2019 – there is much more work left to do. “
Looking at schools, Bump notes that regular day transportation for school has a shortfall of $157.9 million, while in-district special education transportation has a shortfall of $191.4 million. There is an $8.8 million shortfall for municipal reimbursements for veterans’ benefits and a $90.5 million gap in the Community Preservation Act Incentives.
That’s a lot of dough.
Among the findings in the report are “Municipal budgets are heavily dependent on state aid, but outdated legislation, slowly growing state appropriations and level funding in some categories force an increased reliance on property taxes,” and “There is considerable uncertainty facing municipal budgets due to inflation and rising interest rates.”
Among the recommendations are “Dedicate full funding to overlooked categories of school transportation;” “Strengthen other local aid programs to guarantee full funding for lower-income communities;” and “Recognize the financial investment needed to fund other outstanding expenses.”
It’s clear that whoever is going to be governor as well as the membership of the Legislature will have a lot of work on their hands to solve these problems.
G. Michael Dobbs has worked for Reminder Publishing for 22 years of his nearly 50-year-career in the Western Mass. media scene, and previously served as the executive editor. He has spent his time with the publisher covering local politics, interesting people and events.
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