The Fiscal Cliff Comes to Massachusetts: Please Hang on for Our Children & Families!

On December 4, 2012, Massachusetts Governor Deval Patrick announced a 1% cut from the current year’s fiscal budget to meet a budget deficit of $540 million. These “9C cuts,” referring to the section of law that grants the Gov. authority to balance the budget (MGL Chapter 29, Section 9C), will amount to $225 million with the additional funds being withdrawn from the state’s “rainy day fund” as well as federal revenue and reserves. Less than expected tax revenues and a dismal economic recovery, coupled with greater need for safety net services, in part, are to blame.

FY Deficit

Source: Massachusetts Budget & Policy Center

The recent cuts made to the state budget have a direct impact on many important services in the lives of children and families. Below are highlights of those programs and the funding cuts that could mean layoffs, decreases in services, even further limited access to shelter, reductions in needed reimbursements to schools and so much more. A complete list of cuts can be found here.

MA cuts

The Fiscal Cliff
Further intensifying the situation is the unresolved debate over the “fiscal cliff” in Washington. Without a compromise from the U.S. Congress on spending cuts and tax increases, there will be an immediate impact on much needed programs through slashes in the “discretionary spending” budget. Beginning in January, sequestration cuts will be automatically implemented with $55 billion a year in “discretionary spending” reductions lasting from 2013 to 2022. Defense will also be cut by an equal margin. Likely exempt from sequestration are mandatory programs for low-income people such as Medicaid and SNAP/Food Stamps and Social Security benefits; however, discretionary programs such as Head Start, child care, and women’s health services could be drastically diminished.

Massachusetts could be one of the worst hit states if this fiscal nightmare comes to fruition. The state will lose an additional $300 million in tax revenue this year, and could stand to lose up to $1 billion next year as well as millions in federally allocated funds.

As a result, Governor Patrick has warned that an additional $75 million in cuts to this year’s state budget could be made soon if a compromise is not reached in the near term between Democrats and Republicans on Capitol Hill. The Governor’s budget chief, Jay Gonzalez, Secretary of Massachusetts’ Executive Office of Administration and Finance, warned on December 5th that losses in federal funding would impact “really important programs like special education and heating assistance for low income households, and child care subsidies for critical programs that people need.”
Source: http://www.wwlp.com/dpp/news/local/hampden/ma-could-lose-up-to-1-bil-if-fiscal-cliff-talks-fail [Editor’s note: this link no longer exists. Video of report can be viewed here]

Let’s take a closer look at what this could mean for Massachusetts:

562,000 low-and middle-class families in Massachusetts would lose access to the child tax credit, which is equates to a $1,000 loss per a year for every family.
217,000 families in the state would lose assistance from the federal government in paying for college.
The amount Massachusetts’ small businesses can take as a tax deduction would be reduced by $225,000 a year.
Source: http://www.boston.com/politicalintelligence/2012/12/05/white-house-lays-out-impact-massachusetts-families-fiscal-cliff-inaction-results-child-tax-credit-and-tuition-credit-losses/SzXytQiyw6LXjZODEdrOOL/story.html

What Can You Do? Advocate!
Massachusetts’ fiscal position will only grow bleaker if agreement is not reached in Washington over the fiscal cliff soon. Contact your U.S. Congress person and Senator now. Ask them to do all that they can to reach a compromise as soon as possible. Below are suggested advocacy resources to help you contact your members of Congress as well as share your stories of how these cuts will impact you.

Head Start – http://www.supportheadstart.org/7650/help-ensure-sequestration-does-not-happen/
National Women’s Law Center – http://www.nwlc.org/stories/share-your-story-flip-side-coin
Share Our Strength – https://secure.strength.org/site/Advocacy?cmd=display&page=UserAction&id=113
Send your own message by finding your Member of Congress’ email or mailing address
U. S. House of Representatives – http://www.house.gov/representatives/
U. S. Senate – http://www.senate.gov/general/contact_information/senators_cfm.cfm

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