Legislature Passes Fiscal Year 2025 Budget
$58B budget agreement provides for significant levels
of investment in education, regional equity, and transportation
(BOSTON–7/19/24) Today, the Legislature enacted a $58
billion budget for Fiscal Year 2025 (FY25), resolving differences between
the versions of the budget passed by the House of Representatives and the
Senate earlier this year. The FY25 conference committee report maintains fiscal
responsibility while delivering historic levels of investment in every level of
education, transportation regional equity, workforce development and health
care, reflecting the Legislature’s ongoing commitment to delivering on
affordability for residents and economic competitiveness for the Commonwealth.
“At the start of this legislative session I called for a
‘Student Opportunity Plan’ that would build on our landmark Student Opportunity
Act and expand access to quality public education to all our residents from
cradle to career. With the adoption of this FY25 conference report, which
includes universal free community college and comprehensive early education and
care reform and funding, I’m thrilled to say that Massachusetts now has that
comprehensive plan that will provide hope and opportunity to so many,”
stated Senate President Karen E. Spilka (D-Ashland). “This budget
is a vote of confidence in every Massachusetts resident going to school,
raising a family, and working to make ends meet—as well as strong blueprint for
bring equity and opportunity to every region and resident of our state. I want
to thank Chair Rodrigues, Vice Chair Friedman, Assistant Vice Chair Comerford,
the committee, and all my Senate colleagues and staff for their thoughtful and
collaborative work on this great budget, and our partners in the House that
worked to bring this vision into reality.”
“This budget takes a fiscally responsible approach to making
meaningful investments in areas of significant need. I’m proud of the fact that
the FY25 budget allocates key funding to better support Massachusetts students
and families, to increase access to affordable health care, and to provide for
a safer and more reliable public transportation system,” said House
Speaker Ronald J. Mariano (D-Quincy). “I want to thank Chairman Aaron
Michlewitz and my colleagues in the House, along with our partners in the
Senate, for their hard work and critical input throughout this process, a
collective effort that has helped to produce a strong and responsible FY25
budget.”
“While this budget was the result of a lot of hard work, I
would like to offer a sincere and heartfelt thank you to Senate President
Spilka, whose stanch and compassionate leadership guided us through this
process from the beginning. I’m glad to be able to work together as we endeavor
to reshape our economy for the many challenges we continue to face in the new
millennium. This agreement is reflective of a responsive final Fiscal Year 2025
budget that protects our long-term fiscal; health, makes substantial
investments to move our economy forward, and centers regional equity,”
said Senator Michael J. Rodrigues (D-Westport), Chair of the Senate
Committee on Ways and Means. “The FY25 budget specifically makes targeted
investments collectively in education, transportation, local aid, health care,
housing assistance, and workforce development, while shaping an affordable and
fiscally sustainable path for the Commonwealth. Thank you to my Senate and
House conferees, and House Ways and Means Chair Aaron Michlewitz for his
determination, resolve, and partnership to get the job done and produce a
responsible budget we can all be proud of. I also thank all my colleagues in
the Senate, whose advocacy, collaboration, and dedication helped to inform and
shape this comprehensive budget plan. A special thank you to the Ways and Means
staff, whose diligent work over the last several months was largely responsible
for producing this budget, their tireless efforts do not ever go unnoticed.”
“The $58.1 Billion Fiscal Year 2025 conference committee
report is truly a reflection of the best and most critical initiatives that
were contained in the various budget proposals that have been presented this
year. Whether it is greater investments into programs like housing stability,
food security, or early education the initiatives contained in this budget are
a reflection of our shared values,” said Representative Aaron
Michlewitz, Chair of the House Committee on Ways & Means (D-Boston). “By
reinvesting in the people of the Commonwealth we will continue to assist those
in need while making our economy more competitive and equitable for years to
come. I want to thank Speaker Mariano for his leadership during this budget
process, as well as my fellow House conferees, Representative Ferrante and
Representative Smola. I also want to thank my counterparts in the Senate,
specifically my co-chair Senator Rodrigues, for their partnership in bringing
this proposal over the finish line.”
“The Commonwealth’s budget for Fiscal Year 2025 agreed to by
the Legislature today provides for a high level of quality for the programs
that our municipalities and residents rely on,” said Senator Cindy F.
Friedman (D-Arlington), Vice Chair of the Senate Committee on Ways and Means. “This
is a budget that balances fiscal constraints with targeted, impactful
investments that ensure statewide stability and regional equity. As we grapple
with rising costs and access challenges within the Massachusetts health care
system, I am especially proud that this budget utilizes tools to maximize our
health care dollars for the facilities and providers that serve our most
vulnerable residents. I am thankful to the leadership and my colleagues across
the Legislature for their dedicated work to put forward a robust final budget
that will benefit all of Massachusetts.”
"As Massachusetts continues to compete for jobs and
economic growth, the Legislature has produced a fiscally responsible budget
that allocates funding in areas necessary to create pathways to lasting success
for our residents," said Representative Ann-Margaret Ferrante
(D-Gloucester), Vice Chair of the House Committee on Ways and Means. "The
budget emphasizes the need to make Massachusetts an attractive, competitive,
and affordable place to live and work, making groundbreaking investments in
housing, workforce development, education, and transportation. Thank you to
Speaker Mariano and Chair Michlewitz for your leadership and to my fellow
conferees for your collaboration in getting this budget across the finish
line."
“I am very pleased with the outcome of the FY25 Budget
Conference Committee and that our two respective legislative bodies have
effectively reconciled the differences between House and Senate language in a
way which reflects upon the fiscal responsibility and commitment that we have
to the residents of the Commonwealth,” said Senator Patrick M. O’Connor
(R-Weymouth). “The Budget agreement ultimately showcases an investment
in our communities, is supportive of our education system, and will have an
impact in strengthening our state’s economy. I believe that this compromise
proves to be supportive of the priorities that both the House and the Senate
have had throughout our respective budgets, and is a big step forward in the
legislative process. As Ranking Minority Member of the Senate conferees, I have
always taken pride in reaching across the aisle and working with my colleagues,
regardless of our political affiliation, in concluding what will benefit the
lives of those who live and work in Massachusetts the most.”
“This was an exceptionally challenging budget year that
brought some financial uncertainty along the way. We are mindful of those
concerns and are closely watching the fiscal landscape,” said Representative
Todd M. Smola (R-Warren). “Despite the challenges, this budget is a
continuation of our commitment to communities by investing in local aid, and
increases on all levels of education including funding free school meals for
every child in our state. We do this without relying on tax increases,
something that residents appreciate in the current climate. We are grateful for
the hard work and advocacy of so many people across the commonwealth for
important programs.”
The FY25 budget recommends a total of $58 billion in
spending, a $2 billion increase over the Fiscal Year 2024 (FY24) General
Appropriations Act (GAA). This spending recommendation is based on a tax
revenue estimate of $41.5 billion for FY25, which is $208 million less than
revenues assumed in the FY24 GAA. This represents nearly flat growth, as agreed
upon during the consensus revenue process in January, plus $1.3 billion in
revenue generated from the Fair Share surtax.
As the Commonwealth adjusts to a changing economic landscape
and ongoing tax revenue volatility, the FY25 budget adheres to disciplined and
responsible fiscal stewardship. It does not raise taxes, nor does it draw down
available reserves from the stabilization fund or the transitional escrow fund,
while at the same time judicially utilizing one-time resources to maintain
balance. The FY25 budget continues responsible and sustainable fiscal planning
for the future by continuing to grow the Rainy Day Fund, already at a historic
high of over $8 billion, to an anticipated balance of roughly $9 billion at the
close of FY25.
Fair Share Investments to Grow Our Economy
Consistent with the consensus revenue agreement reached with
the Healey-Driscoll Administration in January, the FY25 budget includes $1.3
billion in revenues generated from the Fair Share surtax of four
percent on annual income above $1 million and invests these public dollars to
improve the state’s education and transportation sectors.
Notable Fair Share education and transportation investment
highlights include:
Education: 59% of Fair Share Revenues
· $170 million to
fully fund universal free school meals programming for every public-school
student in the Commonwealth.
· $175 million for
the Commonwealth Cares for Children (C3) program to provide monthly grants to
early education and care programs, which is matched with $300 million in
funds from the new Early Education and Care Operational Grant Fund and the
High-Quality Early Education and Care Affordability Fund for a total investment
of $475 million.
· $117.5 million for
MassEducate to provide free community college across the Commonwealth.
· $80 million to
expand financial aid programs for in-state students attending state
universities through MASSGrant Plus, which is in addition to the $175.9 million
for scholarships funded through the General Fund.
· $65 million for
early education and care provider rate increases, to increase salaries for our
early educators.
· $20 million for
early literacy initiatives.
· $14 million for
grants to State Universities to provide wraparound supports and services.
· $5 million for
the CPPI Pre-K Initiative, matching $17.5 million in funds
from the general fund, for a total of $22.5 million to support
the expansion of universal pre-kindergarten, including in Gateway Cities.
Transportation: 41% of Fair Share Revenues
- $250
million for the Commonwealth Transportation Fund (CTF), which
will leverage additional borrowing capacity of the CTF and increase
investments in transportation infrastructure by $1.1 billion over
the next 5 years. This $250 million includes:
- $127
million to double operating support for the MBTA.
· $63 million in
debt service to leverage additional borrowing capacity.
· $60 million in
operating support for MassDOT.
- $60
million for MBTA capital investments, including $10 million for
resilient rail services.
- $36
million for the MBTA workforce safety reserve.
- $10
million for the MBTA Academy.
- $45
million for roads and bridges supplemental aid for cities and
towns.
- $110
million for regional transit funding and grants to support the
work of Regional Transit Authorities (RTAs) that serve the Commonwealth,
which together with general fund spending funds RTA operations at $204
million. Fair Share funding includes:
- $66
million in direct operating support for Regional Transit
Authorities.
· $30 million for
systemwide implementation of fare-free transit service.
· $10 million to
incentivize connections between regional transit routes.
· $4 million to
support expanded mobility options for the elderly and people with
disabilities.
· $20
million to support implementation of a low-income fare relief program
at the MBTA.
- $7.5
million for water transportation funding and operational
assistance for ferry services.
Education: Early Education and Care, K-12 and Higher
Education
The FY25 budget supports students across the full spectrum
of the Commonwealth’s education system, shaping polices to make high-quality
education more accessible and by making significant investments in the
education system, from our youngest learners to adults.
To create a new funding source for EEC initiatives, the
budget allows the Massachusetts Lottery to sell its products online. A portion
of the new revenue collected from online lottery sales, estimated to be $100
million in FY25, would fund C3 grants, which provide long-term
stability for high-quality and affordable care for families.
The budget report delivers significant levels of investment
in education, including:
- $6.9
billion in Chapter 70 funding, an increase of $317
million over FY24, as well as increasing minimum Chapter 70 aid
from $30 to $104 per pupil, delivering an additional $37
million in resources to school districts across the state.
- Over $1.55
billion investment in the early education and care sector,
including:
- $475
million for the Commonwealth Cares for Children (C3) grants.
- FY25
is the second fiscal year in a row which the annual state budget includes
a full year of funding for C3 grants, signaling a historic commitment to
maintain this crucial lifeline for our early education and care sector.
- The
FY25 budget also makes the C3 program permanent, while including
provisions to direct more funds from the C3 program to early education
and programs that serve children receiving childcare subsidies from the
state and youth with high needs.
- $117.5
million for free community college across the Commonwealth,
covering tuition and fees for students.
- $493.2
million for the special education (SPED) circuit breaker.
- $99.5
million to reimburse school districts for regional school
transportation costs, representing an 85 per cent reimbursement rate.
- $18.5
million for Head Start grants.
- $16
million for rural school aid assistance.
- $6
million for Social Emotional Learning Grants to help K-12 schools
continue to bolster social emotional learning supports for students,
including $1 million to provide mental health screenings for K-12
students.
- $5
million for grants to support implementation of the Massachusetts
Inclusive Concurrent Higher Education law, including $3
million for grants offered through the Massachusetts Inclusive
Concurrent Enrollment initiative to help high school students with
intellectual disabilities ages 18–22 access higher education
opportunities; and $2 million for the Massachusetts
Inclusive Concurrent Enrollment Trust Fund.
- $3
million for genocide education grants to facilitate teaching
students the history of genocide.
- $1
million for hate crimes prevention grants to support the
prevention of hate crimes in public schools.
The FY25 budget codifies several provisions that transforms
the early education sector by improving affordability and access for families,
increasing pay for early educators, and ensuring the sustainability and quality
of early education and care programs.
In K-12 education, the FY25 budget follows through on the
Legislature’s commitment to fully fund and implement the Student Opportunity
Act (SOA) by Fiscal Year 2027, investing $6.9 billion in Chapter 70
funding, an increase of $319 million over FY24, as well as increasing minimum
Chapter 70 aid from $30 to $104 per pupil, delivering an additional $37 million
in resources to school districts across the state. With these investments,
the Legislatures continues to provide crucial support to school districts
confronting the increasing cost pressures that come with delivering
high-quality education to all students.
In addition to the record levels of investment in early
education and K-12, the FY25 budget removes barriers to accessing public higher
education by codifying into law MassEducate, a $117.5 million
investment in universal free community college program that covers tuition and
fees for residents, aimed at supporting economic opportunity, workforce
development, and opening the door to higher education for people who may never
have had access. The FY25 budget permanently enshrines free community college
into law in an affordable and sustainable manner across the Commonwealth, while
leaving no federal dollars on the table.
Health, Mental Health and Family Care
Investments in the FY25 budget allow more than two million
people to receive continued access to affordable and comprehensive health care
services. Health care investments include:
- $20.36
billion for MassHealth, representing the largest investment made
in the state budget.
- $2.9
billion for a range of services and focused supports for people
with intellectual and developmental disabilities.
- $622.4
million for Department of Mental Health (DMH) adult support
services.
- $625
million for nursing facility Medicaid rates, including $40
million in additional base rate payments to maintain competitive
wages in the Commonwealth’s nursing facility workforce.
- $390
million for Chapter 257 rates to support direct-care providers
across the continuum of care.
- $212.7
million for a complete range of substance use disorder treatment
and intervention services.
- $131.4
million for children’s mental health services.
- $33.8
million for Family Resource Centers to grow and improve the
mental health resources and programming available to families.
- $30.9
million for Early Intervention services, ensuring supports remain
accessible and available to infants and young toddlers with developmental
delays and disabilities.
- $29.6
million for grants to local Councils on Aging to increase
assistance per elder to $15 from $14 in FY 2024.
- $27.9
million for family and adolescent health, including $9.2
million for comprehensive family planning services and $6.7
million to enhance federal Title X family planning funding.
- $20
million to recapitalize the Behavioral Health, Access, Outreach
and Support Trust Fund to support targeted behavioral health initiatives.
- $14.7
million for maternal and child health, including $10.4
million for pediatric palliative care services for terminally ill
children and a policy adjustment to ensure that children up to age 22 can
continue to be served through the program.
- $5.5
million for Children Advocacy Centers to provide critical
supports available to children that have been neglected or sexually
abused.
- $2
million for grants for improvements in reproductive health
access, infrastructure, and safety.
The FY25 budget, for the first time in Massachusetts’
history, allows an individual to be identified with a non-binary ‘X’ sex
designation on their birth certificate and enshrine into law the current
practice of allowing an individual to select a non-binary ‘X’ gender
designation on their driver’s license. This step ensures that all
residents—including trans and nonbinary people—can secure government documents
that accurately reflect who they are.
Additionally, the FY25 budget recognizes that the cost of
fertility preservation should not be a barrier to starting a family for
Massachusetts residents with cancer or other serious medical conditions.
It therefore requires health insurance carriers to cover fertility
preservation treatments for individuals who have a medical diagnosis or who are
going through medical treatments that may impact fertility. It also includes
coverage for the procurement, cryopreservation, and storage of gametes, embryos,
or other reproductive tissue.
Housing
The FY25 budget invests $1.15 billion in
housing, dedicating resources for housing stability, residential assistance,
emergency shelter services, and homelessness assistance programs, ensuring the
state deploys a humane, responsible, and sustainable approach to providing
families and individuals in need with an access point to secure housing.
The budget prioritizes relief for families and individuals
who continue to face challenges brought on by the pandemic and financial
insecurity, including $326.1million for Emergency
Assistance Family Shelters, in addition to the $175 million in
resources passed in the recent supplemental budget, to place the Commonwealth’s
shelter system on a fiscal glidepath into FY25. Housing investments include:
- $231.7
million for the Massachusetts Rental Voucher Program (MRVP),
including $12.5 million in funds carried forward from
FY24.
- $197.4
million for Residential Assistance for Families in Transition (RAFT).
- $113
million for assistance to local housing authorities.
- $110.8
million for assistance for individuals experiencing
homelessness.
- $57.3
million for the HomeBASE program.
- $27
million for the Alternative Housing Voucher Program (AHVP),
including $10.7 million in funds carried forward from
FY24, to provide rental assistance to people with disabilities.
- $10.5
million for assistance for unaccompanied homeless youth.
- $10.5
million for Housing Consumer Education Centers (HCECs).
- $8.9
million for sponsor-based supportive permanent
housing.
- $8.9
million for the Home and Healthy for Good re-housing and
supportive services program, including funding to support homeless LGBTQ+
youth.
The FY25 budget includes important consumer protections,
including ending the practice of home equity theft, a practice where
cities, towns, and even private companies can foreclose on a home for taxes
owed, sell it, and pocket the profits. With this crucial step, the Legislature
strikes a balance to ensure equity is returned to homeowners and taxpayers,
while municipalities will be made a whole and protected moving forward.
Expanding and Protecting Economic Opportunities
The budget includes a record investment in the annual child’s
clothing allowance, providing $500 per child for eligible
families to buy clothes for the upcoming school year. The budget also includes
a 10 per cent increase to Transitional Aid to Families with
Dependent Children (TAFDC) and Emergency Aid to the Elderly, Disabled and
Children (EAEDC) benefit levels compared to June 2024. Other economic
opportunity investments include:
- $496.2
million for Transitional Assistance to Families with Dependent
Children (TAFDC) and $183.2 million for Emergency Aid to
Elderly, Disabled and Children (EAEDC) to provide the necessary support as
caseloads increase, and continue the Deep Poverty increases.
- $59.8
million for adult basic education services to improve access to
skills necessary to join the workforce.
- $42.4
million for the Massachusetts Emergency Food Assistance Program.
- $15
million in Healthy Incentives Programs to maintain access to
healthy food options for households in need.
- $10.4
million for Career Technical Institutes to increase our skilled
worker population and provide residents access to career technical
training opportunities.
- $10
million for the Workforce Competitiveness Trust Fund to connect
unemployed and under-employed workers with higher paying jobs.
- $10
million for a community empowerment and reinvestment grant
program to provide economic support to communities disproportionately
impacted by the criminal justice system.
- $5.4
million for the Innovation Pathways program to continue to
connect students to training and post-secondary opportunities in STEM
fields.
Community Support
The FY25 budget further demonstrates the Legislature’s
commitment to partnerships between the state and municipalities, dedicating
meaningful resources that touch all regions and meet the needs of communities
across the Commonwealth. This includes $1.3 billion in funding
for Unrestricted General Government Aid (UGGA), an increase of $38
million over FY24, to support additional resources for cities and
towns.
In addition to traditional sources of local aid, the FY25
budget includes the following local and regional equity investments:
- $204
million for Regional Transit Authorities (RTAs) to support
regional public transportation systems, including $110
million from Fair Share funds to support our RTAs that help to
connect all regions of our Commonwealth.
- $53
million for payments in lieu of taxes (PILOT) for state-owned
land, an increase of $1.5 million over FY24. PILOT
funding is an additional source of supplemental local aid for cities and
towns working to protect and improve access to essential services and
programs during recovery from the pandemic.
- $52.4
million for libraries, including $19 million for
regional library local aid, $20 million for municipal
libraries and $6.2 million for technology and automated
resource networks.
- $26.9
million for the Massachusetts Cultural Council to support local
arts, culture, and creative economic initiatives.
Having passed the House of Representatives and the Senate,
the FY25 budget now moves to the Governor’s desk for her consideration.
