GloucesterTimes.com, Gloucester, MA

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December 4, 2012

Governor eyes cuts in local aid

BOSTON — Seeking to address an estimated $540 million mid-year budget gap, Gov. Deval Patrick on Tuesday slashed spending by $225 million and asked the Legislature to allow him, as part of the plan, to unilaterally reduce unrestricted local aid to cities and towns by 1 percent across the board.

Unrestricted local aid pays for services covered under municipal police and fire department budgets, and is delivered separately from state aid to fund local education spending, which is not targeted for cuts under Patrick’s plan.

“I don’t think this is draconian,” Patrick said. “Obviously every city and town worries about an impact on their local aid, but as I say this is relatively modest. We are spreading the pain as broadly as possible and sensibly and we have a solution for closing that gap in unrestricted local aid if the Lottery continues to help.”

The other spending cuts ordered by the governor will hit nursing homes, special education funding, school transportation for the homeless and reimbursement rates for hospitals that treat low-income patients.

Patrick is asking to trim local aid by $9 million, and said that, if Lottery revenue exceeds expectations the surplus would be used to restore the reduced funding at the end of the year.

As an example of the potential impact, the city of Gloucester’s net state aid for the 2013 fiscal year, as outlined in Mayor Carolyn Kirk’s State of the City presentation Monday night, is pegged at just over $5 million, meaning that a 1 percent cut would amount to a loss of some $50,000.

Kirk’s report noted that state aid, which accounted for 17 percent of the city’s overall budget 11 years ago, now accounts for just 5 percent. Nonetheless, in Gloucester and in Cape Ann’s towns, municipal officials are going forward with current year spending based on the promised level of aid and any cut would mean some financial juggling in city and town halls across Cape Ann, and across the state.

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