Governor Deval Patrick's Budget Recommendation - House 1 Fiscal Year 2010

Governor's Budget Recommendation FY 2010

Letter to the Chairmen

Commonwealth Seal on Letterhead

THE COMMONWEALTH OF MASSACHUSETTS
EXECUTIVE OFFICE FOR
ADMINISTRATION AND FINANCE
STATE HOUSE, ROOM 373
BOSTON, MA 02133

  

DEVAL L. PATRICK
GOVERNOR
 
TIMOTHY P. MURRAY
LIEUTENANT GOVERNOR
 
LESLIE A. KIRWAN
SECRETARY

  

TEL:  (617) 727-2040
FAX: (617) 727-2779
www.mass.gov/eoaf

                                                                                                    May 5, 2009

The Honorable Steven C. Panagiotakos, Chair
Senate Committee on Ways and Means
State House, Room 212
Boston, MA 02133

The Honorable Charles Murphy, Chair
House Committee on Ways and Means
State House, Room 243
Boston, MA 02133

Dear Chairmen Panagiotakos and Murphy:

I am writing to request that you reflect an adjustment to the FY2010 H.1 budget recommendations in your versions of the budget.  As discussed with your staff, $35 million in funding was reserved in the H.1 balance sheet for anticipated collective bargaining costs.  The Administration has been actively negotiating with state unions, all of whom have contracts that have already expired, or will expire on June 30, 2009.  Those contract financial parameters generally prescribe the following (specifics will vary based on the contract end date):

  • 1st year (generally FY2009) – 0% across-the-board increases, although step increases will be applied;
  • 2nd year (generally FY2010) – 1% across-the-board increases, with additional increases if tax revenues reach certain levels above the current forecast; and
  • 3rd and 4th years (generally FY2011 and FY2012) – 3% across-the-board increases.

Since we have been working without a contract for most of our unions, we are pleased to be able to reach agreements with them.  Given our current fiscal condition and forecast, we feel that it is fiscally responsible to reduce salary growth during the 1st and 2nd years of the contract, but that it is also unreasonable to expect that those lower increases would continue into the 3rd and 4th years.

Attached are draft line-items that we respectfully ask to be included in the House and Senate versions of the budget.  The majority of the anticipated costs have already been obligated and ratified by the union membership.  Additional costs are anticipated since contracts are actively being negotiated.  Those costs are isolated in a separate reserve account, and we will provide specific language for you to approve them as they are ratified. 

The attachment contains funding for the following contracts:

1599-4281
                    		 National Association of Government Employees (Units 1, 3 and 6) Ratified
March 3, 2009		 $4,610,648
1599-4282 Service Employees International Union (Units 8 & 10) Ratified
April 2, 2009		 $9,874,949
1599-4283 Association of Federal, State, County and Municipal Employees, Local 888 (Unit 2) Ratified
April 9, 2009		 $3,008,405
1599-4284 Funding for alternative dispute resolution arbitrators per HRD contracts   $30,000
1599-4285 UMass Faculty, Amherst and Boston campuses Ratified
March 3, 2009		 $2,112,924
1599-4286 Funding Reserved for Agreements currently being negotiated   $15,363,074
Total: $35,000,000

In addition to the collective bargaining funding, please also correct Outside Section 44, concerning charter school spending, in subsection (a), by striking out the words “in fiscal year 2010”, which were included by mistake.

Also, line item 8200-0210, the new police training account for the Municipal Police Training Committee was inadvertently under-funded by $700,000.  House 1 included $3.1M for 8200-0210 and $3.2M for 8100-0515, the New State Police Class. Line item 8200-0210 should have been funded at $3.8M, but was under funded due to an oversight.  Both line items are apart of the Governor’s Police Training Initiative and funded through a new automobile insurance surcharge. The purpose of this initiative is to fully fund comprehensive police training, revise the current curriculum and ensure police officers are receiving quality in-service trainings.  The surcharge will be $1.60-$2.00 on private auto insurance policies.

Finally, language to allow the Division of Healthcare Finance and Policy to assess its costs was inadvertently omitted.  Please add the following language to the end of item 4100-0060:

provided, that notwithstanding any general or special law to the contrary, the assessment to acute hospitals authorized pursuant to section 5 of said chapter 118G for the estimated expenses of the division shall include in fiscal year 2010, the estimated expenses, including indirect costs, of the division and shall be equal to the amount appropriated in this item less amounts projected to be collected in fiscal year 2010 from: (a) filling fees; (b) fees and charges generated by the division’s publication or dissemination of reports and information; and (c) federal financial participation received as reimbursement for the division’s administrative costs; provided further, that the assessed amount shall not be less than 65 per cent of the total expenses appropriated for the division and the health safety net office

Thank you for your support of these important initiatives. 

                                                                                                    Sincerely,

 

                                                                                                    Leslie A. Kirwan
                                                                                                    Secretary

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