Massachusetts Governor Proposes Big-Spending Fiscal 1994 Budget

WHILE governors from Maine to California are proposing harsh belt-tightening budget initiatives this year, Massachusetts Gov. William Weld (R) is submitting his biggest state spending plan since he took office two years ago.

Amid criticism from legislative leaders who say his plan is based on false promises and lacks an education-reform package, Governor Weld, a fiscal conservative, presented Wednesday his $15.2 billion budget for fiscal 1994. It includes an economic-stimulus program and more spending for virtually every human-service agency, prisons, and environmental protection.

The governor promises a balanced budget that returns money to taxpayers, reduces the growth rate of "budget-buster" programs such as Medicaid, and shifts money away from "maintenance" programs to fund preventive and investment initiatives such as higher education.

Weld's plan includes a $20 million tax credit for residents paying college tuition, $35 million in tax deductions to help senior citizens pay for health insurance, and reductions in fees for drivers' licenses and automobile registrations. The budget includes about $110 million in revenues from a new cigarette tax. Weld also proposes two new gambling initiatives, keno and video poker, which could generate $100 million in revenues over the next fiscal year.

"This budget makes the right moves, we feel, to get the economy moving again," Weld said at a press conference. "It invests in programs that give people a chance to succeed in life, and it does provide some tax relief for our citizens."

But critics fault the governor for not including a $361 million education-reform package he said he would support. As a result, the General Court (legislature) will be forced to make unpopular cuts in other programs to allow for the $361 million. Weld promises to revisit the budget and come up with a new plan to include the education money if the General Court passes the reform package.

"One thing I like about this approach is that I think it does keep the heat on for passage of the [education] reform bill," he said.

State Rep. Thomas Finneran (D), chairman of the House Ways and Means Committee, says Weld created false expectations by taking the $361 million that should have been earmarked for education reform "and sprinkling it around like liquid fertilizer" for other programs. While Weld and the state Democratic General Court have been praised for bringing a severe fiscal crisis under control, the Bay State still cannot afford big spending initiatives, Representative Finneran says.

"We just have to continue to make [sacrifices] until the economy begins to return," he says. "But the governor does neither the public nor himself any favors by engaging in deceptive practices."

Among tough economic times, New England and California especially have had to struggle with budget shortfalls. This month, Maine Gov. John McKernan Jr. (R) proposed sharp reductions in state aid to education, human-service programs, and the elimination of 850 state jobs in his budget for the next two years. Last year, Connecticut enacted an income tax to help raise revenues.

Robert Tannenwald, an economist at the Federal Reserve Bank in Boston, says Weld has administered some "pretty strong fiscal medicine" over the past two years that has helped bring the state's budget crisis under control. "The fiscal situation in the New England states has been better than the dismal days of 1990 and 1991, but the New England states are far from out of the woods," Mr. Tannenwald says. "In the last half of fiscal year 1993, all are quite cautious - perhaps with the exception of Massachuse tts - and all are fretting."