BOSTON – The Massachusetts Secretary of Administration and Finance confirmed that there will be an executive branch hiring freeze until the fiscal year ends on June 30 – except, they stress this is “not a hiring freeze.”
“The Healey-Driscoll administration is implementing hiring controls within the Executive branch for the remainder of the fiscal year as one tool at our disposal to responsibly manage spending over the next three months,” a statement of Matthew J. Gorzkowicz says. “These hiring controls, while temporary, will help ensure that the administration can balance the budget at the end of the year and preserve critical funding for core programs and services.”
State has not met predicted revenue income
While March numbers were stronger than those in recent months, with revenues increasing, the state has not met its predicted revenue income in either last fiscal year or this one so far. The concern there? That the budget approved for the fiscal year will exceed the tax revenue brought in by the state.
So, what’s contributing to low revenues? In part, it’s because budgets were built based on previous revenue streams in 2021 and 2022, which were very high revenue years due to spending and a large flow of federal pandemic relief money. “The good news is, we put a ton of money into the Rainy Day Fund,” explained Doug Howgate, the President of the Massachusetts Taxpayers Foundation. “We put a ton of money into other reserves. The bad news is, we also grew the budget at 6, 7%, 8%. And so when the music stopped on revenues growing at that same incredible rate, all of a sudden you had a budget that was growing faster than revenues were growing.”
In simpler terms, “Imagine if you were budgeting your year on a bonus you thought you were going to get,” Howgate explained. “And then you didn’t get that bonus right? It doesn’t mean you’re never going to make money again. It means, though, that you have to figure out how you’re going to manage without that bonus. That’s the situation we’re in right now.”
Impact of migrant crisis
WBZ asked officials whether the unexpected hundreds of millions of dollars spent to feed and house migrants in our state’s overwhelmed shelter system contributed in any way to our budget struggles. A spokesperson explained that pressure on the shelter system does not impact revenue or tax collections, but rather, adds cost. To date, the state has been able to pay for the increased demand to date with reserves from prior year surpluses so that has not impacted the state’s operating budget.
Healey criticized for overspending
Critics say the budget struggles Governor Healey is trying to fix are ones she created. “For the last year and a half, the governor has been on a complete spending and hiring spree,” said Paul Craney of the Massachusetts Fiscal Alliance. “We have seen her fill positions that were left vacated by the previous governor. We have seen her create new positions and fill them.
He says the hiring freeze is a reaction to her overspending – a claim other nonpartisan budget experts have rejected. “It’s like a child pulling their parents credit card, going to spending spree and saying, I won’t spend anymore,” Craney said. “As a parent, you would say, ‘no, you’re going to return everything. And that’s what we’re saying, is you created such a problem right now that just by saying you won’t spend any more, that’s not going to fix the situation.”
So how do budget failures impact you?
“The state budget is the chief way that we as Massachusetts bring together the resources we need for the things that we can’t accomplish individually, so if we need roads? We don’t expect each family to build its own roads,” explained Phineas Baxandall of the Massachusetts Budget & Policy Center. “Schools, parks, libraries, that sort of thing. If we have more revenue coming in, it allows us to invest in more of these things,” he explained.
