DeLeo: House budget will call for 3 percent spending increase

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BOSTON >> Don't expect a huge spending spree when Massachusetts House leaders unveil their annual budget bill next month and debate it in late April.

Gov. Charlie Baker in January proposed a $39.55 billion fiscal 2017 budget that would raise spending by 3.5 percent, invest in child protection services, bulk up the state savings account and reduce the use of one-time revenues that the Republican governor says are unsustainable.

It appears the House will embark on its annual spending deliberations with an even smaller budget than the governor proposed in his bill known as House 2.

"Next year's budget will be about 39.4. Three percent," House Speaker Robert DeLeo said during a Monday evening radio appearance on the WBZ program "Nightside" with his friend Dan Rea, the program's host.

The Winthrop Democrat's declaration comes in the wake of an agreement between Baker and House and Senate leaders that state tax collections will rise by 4.3 percent in the fiscal year that starts July 1. With Massachusetts in the midst of sustained job growth, advocates for myriad causes — education, housing, mental health and the environment — are pressuring lawmakers to boost investments and address service and program demands they say have gone unmet since the Great Recession.

But state budget overseers, while looking ahead to next year, are not out of the woods for the current budget year. Tax collections, the major revenue-side building block for the $38 billion fiscal 2016 budget, are up only 1.7 percent eight months into the fiscal year, due in part, according to the Department of Revenue, to softer bonus payouts compared to last year due to lower corporate earnings. Baker's team is counting on a revenue surge in the coming months to cover up the bulk of a budget gap identified in January.

While drawing the skeptical eyes of Wall Street credit rating houses and others for their use of rainy day fund revenues amidst a growing economy, House and Senate leaders in each of the past two budget cycles have also approved budget bills that required midyear spending cuts and other revenue savings adjustments.

Two weeks before House Ways and Means Committee Chairman Rep. Brian Dempsey is scheduled to release his next budget, DeLeo vowed to ensure assistance through the budget for "those amongst us in our state who truly need that help -- the sick and disabled." But DeLeo also warned against any "free-spending ways."

"We show signs, I think more than many other states, that you know we're doing a whole lot better than a lot of other states," DeLeo said. "Having said that I do have to say that if people are looking at a time that we don't have to take that sort of outlook, that you know you can go back to free-spending ways, people are wrong. We're not at that stage, nor will I ... ever personally be at that stage."

The House spending plan is marked for release on April 13, with debate the week of April 25.

In past years, the full House has usually added spending to its Ways and Means Committee's budget proposal, with members signing off on consensus amendments produced following private debates held in a lounge off the House chamber.

DeLeo, who helped engineer a sales tax increase during the Great Recession, has in recent years often opposed tax increases. This year, after Baker proposed a budget that did not include new or higher taxes, DeLeo ruled out new or higher taxes in the House budget.


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