By Michael P. Norton, State House News Service
BOSTON The Massachusetts Legislature was the last in the nation to enact an annual budget this year and now their drawn-out deliberations over last year’s state budget are about to cost the taxpayers real money.
Comptroller Andrew Maylor faces a Thursday deadline to file the state’s annual Statutory Basis Financial Report closing the books on spending and revenues for the fiscal year that ended June 30, almost four months ago. But here’s the problem: the Legislature still isn’t done spending last year’s revenues.
Beacon Hill talks on a final fiscal 2019 supplemental budget only started to heat up this month, and House and Senate Democrats are currently looking at two different bills that spend most of last year’s budget surplus, while proposing rainy day savings account deposits of between $350 million and $400 million.
In a letter delivered to top lawmakers and Gov. Charlie Baker Tuesday, Maylor said that when the budget bill is eventually signed by Gov. Charlie Baker, it will take about 14 days to compile the final financial report and have it reviewed by the state’s independent audit firm, currently KPMG. That timeline puts Maylor’s office well beyond its statutory filing deadline.
“Please note that this is a target to help you understand when the SBFR might be issued but is not a guarantee,” Maylor wrote.
As part of his work, Maylor is required to certify and report the state’s consolidated net surplus at the same time as he issues the financial report, and the surplus certification determines if the budget is balanced and if there’s any amount to be transferred to the rainy day account.
Basing his calculations on the financial report being issued on Nov. 15, Maylor projected forgone interest on expected stabilization fund revenues of more than $500,000, an amount he estimated will increase by more than $30,000 each day beyond Nov. 15.
Calling it a “measurable downstream impact” of not filing the financial report on time, Maylor wrote, “I realize that this amount may not seem important, but as a taxpayer and someone who spent more than 25 years in local government, that sum is meaningful.”
The spending bills are on the minds of legislators, and the many stakeholders throughout Massachusetts who stand to benefit from newly authorized spending. The House closeout budget totaled about $723 millin in spending; the Senate bill authorized $780 million in spending.
“On Beacon Hill, a supplemental budget should be coming out, we think this week,” Education Commissioner Jeff Riley told the Board of Education Tuesday.
Riley added, “We think legally they have to figure this out by Oct. 31, but that may be pushed. Legally is perhaps too strong a word. Maybe they’re shooting for Oct. 31, traditionally.”
Last year, Treasurer Deb Goldberg and former Comptroller Thomas Shack knocked the practice of passing final supplemental budgets so long after fiscal years had ended, with Goldberg comparing the practice to “kids getting away with stuff for too long.”
To follow industry best practices, Shack said, a final supplemental budget should be approved by Aug. 31 each year.
“This is the fourth fiscal year that I’ve operated as the commonwealth’s comptroller and this is the fourth year under my comptrollership that we will not meet the statutory deadline,” Shack said last October.”I would reiterate that such late activity is really perilous. It’s a well-known risk within the audit world that if you do not meet your own statutory obligations you may well subject yourself to really, really significant scrutiny.”
Senate President Pro Tempore William Browsberger said lawmakers are aware of Thursday’s deadline and said there’s a possibility that the budget bills could be reconciled without the need for a six-member conference committee.
Katie Lannan contributed reporting
