Thursday May 17, 2012

BOSTON (AP) -- A top Senate panel unveiled a $32.3 billion Massachusetts budget Wednesday that calls for no new taxes or fees, creates a new state police unit to investigate welfare fraud and keeps partially open a state psychiatric hospital pegged for closure by Gov. Deval Patrick.

The proposed budget, approved unanimously by the Senate Ways and Committee, would increase overall state spending in the fiscal year starting July 1 by 3.7 percent over current year levels, according to Sen. Stephen Brewer, D-Barre, the panel’s chairman.

The plan calls for one-time revenues and some spending cuts to close a projected $1.4 billion gap between spending and revenues in the next fiscal year, and would tap the state’sreserve fund -- commonly known as the "rainy day" fund, for $290 million.

"You can’t be all things to all people all the time in this budget," said Brewer. "It’s not possible. We’re not entertaining new revenues, we’re not entertaining new fees."

The budget will be debated by the full Senate later this month. In April, the House of Representatives passed a spending plan that also included no new taxes and called for a larger withdrawal of $400 million from the rainy day fund.

Patrick proposed a budget earlier this year that sought increases in taxes on cigarettes and other tobacco products and a sales tax on soda and candy.

Brewer said Massachusetts had been able to withstand the economic downturn better than most other states because of the strong fiscal discipline it had exercised. He pointed to the state’s historically strong bond rating and noted that even after withdrawing from the rainy day fund Massa chusetts would remain one of only three states with more than $1 billion in reserve.

"We’re Massachusetts and we don’t kick the can down the road, and we address issues as they come," Brewer said, contrasting the state with California, which is facing an estimated $16 billion deficit.

Like the House, the Senate’s proposed budget seeks a crackdown on alleged misuse of Electronic Benefit Transfer cards by welfare recipients, but takes a different approach.

The Senate would appropriate $750,000 for a new public benefit fraud unit in the state police. The unit would probe suspected cases in which welfare or food stamp benefits were being misused.

The Senate bill would also add tattoo parlors, strip clubs and gambling to the list of banned EBT purchases, but it does not include many of the other restrictions that were included in a House budget amendment, including cosmetics.

"I think it’s important not to get on a slippery slope of trying to define which hair color, which food or which soap or whatever it is," Brewer said.

The Senate also proposes, for the first time, to impose criminal penalties on people who try to sell or transfer their food stamps.