Baker Signs $3.76 Billion Economic Development Bill

Governor Charlie Baker signed a $3.76 billion spending plan that promotes economic development, strengthens health and human services, advances clean energy and resiliency, expands affordable housing production and invests in Massachusetts communities, businesses and workers. The legislation includes funding for several proposals introduced by the Baker-Polito Administration in the FORWARD economic development bill filed in April and in multiple supplemental budget proposals, including the most recent proposal from August to close out Fiscal Year 2022 (FY22).

“This legislation will make strategic investments in economic development, increase affordable housing production and support our health care system,” said Governor Charlie Baker. “We appreciate the Legislature’s efforts to pass this bill which is necessary to invest the Commonwealth’s significant state surplus and time-sensitive federal relief dollars. While I am disappointed that the bill does not include permanent tax relief that is affordable and was supported by our administration and the Legislature, I am pleased that the Commonwealth’s strong financial position allows us to make these critical investments on behalf of our communities.”

“This bill addresses a wide range of needs across Massachusetts, from investing in long-term housing affordability to enabling transformational projects in hundreds of cities and towns,” said Lieutenant Governor Karyn Polito. “This funding will play a crucial role in the continued growth of local economies, businesses and families and we look forward to seeing it put to work.”

The bill is funded by a combination of state resources, including FY22 surplus revenue, and federal funds from the American Rescue Plan Act Fiscal Recovery Fund (ARPA-FRF). Notably, the Governor vetoed an outside section that would cap the use of ARPA-FRF funding to $510 million (of the $2.3 billion that remains available in ARPA-FRF funds). Federal law requires that the entirety of these federal funds be committed by the end of 2024 and spent by the end of 2026. Vetoing this section will allow the Commonwealth to prioritize the use of the time-limited federal dollars.

“This legislation will build upon our efforts over the last several years to strategically deploy billions in federal and state funding to bolster the Commonwealth’s economy through the pandemic and accelerate recovery,” said Administration and Finance Secretary Michael J. Heffernan. “We appreciate the collaboration of our colleagues in the Legislature on this important bill, which will further support key areas of need, make long-lasting improvements to Massachusetts infrastructure, and invest in local communities across the state.”   

Highlights of the bill include:

Health and Human Services

• $850 million in near-term relief for fiscally strained hospitals, human service providers, nursing facilities, rest homes and community health centers

• $200 million to support the Commonwealth’s continued response to and management of COVID-19

• $25 million for low-threshold housing for individuals experiencing homelessness

• $20 million to address the varied needs of immigrants and refugees

• $20 million to combat gun violence

• $20 million for the Victim and Witness Assistance Board

• $17.5 million to support access to reproductive care and family planning services

Education

• $150 million to stabilize early education and care providers

• An additional $315 million transfer to the High-Quality Early Education & Care Affordability Fund via an outside section amending the FY23 budget

• $50 million to support scholarships for Massachusetts students enrolled in higher education nursing programs

Housing production and affordability

• $100 million for workforce housing production

• $100 million for homeownership expansion through the Commonwealth Builder program

• $100 million to support the creation of affordable housing through the Affordable Housing Trust

• $57 million for the Low-Income Home Energy Assistance Program

• $50 million for the Equitable Developers’ financing program

Economic development

• $153 million to support a variety of businesses in need across the state, including $75 million for hotels, $45 million for businesses reaching underserved markets, and $40 million for small businesses

• $75 million to support broadband infrastructure and internet access

• Hundreds of local community and economic development projects

Clean Energy and Environmental Infrastructure

• $175 million for investments in publicly-owned green space and environmental infrastructure, including $75 million in environmental justice communities

• $150 million for clean energy initiatives, including transfers to the Clean Energy Investment Fund, Electric Vehicle Adoption Incentive Trust, and Charging Infrastructure Deployment Fund

• $115 million for water quality improvement projects through the Massachusetts Clean Water Trust

• $100 million for improvements to port infrastructure

• $25 million to support food security infrastructure

Transportation

• $112 million to support key needs at the Massachusetts Bay Transportation Authority (MBTA), including for implementation of Federal Transit Authority (FTA) directives

The Governor signed the large majority of the 271 outside sections included in the bill, including sections that make corrections that will allow for the successful implementation of new tax credits related to offshore wind and the hiring of National Guard members. The Governor also approved policy sections that will improve the operation and effectiveness of the Brownfields Redevelopment Fund and smart growth zoning through an improved Starter Home Zoning chapter of the General Laws. Additional sections will change the Department of Public Health’s (DPH) standing order authority related to COVID-19 testing and treatment and will establish effective and efficient administrative processes through which DPH will manage the licensure and oversight of Registered Sanitarians and Certified Health Officers.

Governor Baker returned two outside sections to the Legislature with proposed amendments and vetoed a total of 24 sections.

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