BOSTON -- House Democrats are shunning the use of federal pandemic relief money for budget filler as they craft the state’s spending plan for the next fiscal year.
The House Ways and Means Committee, which on Wednesday unveiled its version of the state budget that takes effect July 1, proposes using state revenue to balance the spending plan, instead of an anticipated influx of federal funds from President Joe Biden's $1.9 trillion stimulus bill.
House Ways and Means Chairman Aaron Michlewitz, D-Boston, said budget writers decided to set aside the federal funds to use in support of the state's long-term, post-pandemic recovery.
In a briefing with reporters, Michlewitz warned of using one-time federal relief to pay for everyday operations.
"We do not want to find ourselves in a place where the federal dollars have run out and our economy is stuck in neutral with revenues never getting back to pre-pandemic levels," he said.
Michlewitz said tax collections are coming in better than expected, which provides more revenue to offset the pandemic's impact.
"While this is encouraging news and bodes well for our economic outlook, we will have to see what the next few months bring before declaring any sort of victory on this fiscal year," he said.
House Speaker Ronald Mariano, D-Quincy, agreed that budget writers were concerned about creating a structural deficit by plugging revenue shortfalls with one-time federal funding.
"We will move on, deal with our budget now, and sometime around June deal with the financial impact of the federal monies," he said at the briefing.
Massachusetts stands to get $4.5 billion in direct funding from the latest federal relief package, which includes billions more in aid for schools, local governments and businesses still reeling from the economic fallout of the coronavirus.
The current fiscal year's budget relied heavily on one-time revenues, including $1.3 billion from reserves and about $550 million in federal pandemic relief.
Gov. Charlie Baker filed a preliminary $45.6 billion budget in January that banked on the federal funds to reduce a $1.7 billion drawdown on the state's reserve fund.
Overall, the $47.6 billion House budget proposes no tax increases and boosts funding for health care, schools and food insecurity. That’s about 3.9% more than Baker's plan.
The governors plan, which was filed before Congress approved the relief bill, also didn't anticipate any additional federal stimulus funding.
In addition to avoiding one-time funds to pay for regular expenses, budget writers say they weren’t sure what strings may be attached to the federal pandemic relief money.
"Until we see what the guidelines are, it's hard to speculate on what we will be able to spend that money on," Michlewitz told reporters.
Michlewitz acknowledged the impact of federal funds, good and bad, in helping the state weather the public health crisis.
"Items like unemployment assistance, (Payroll Protection Program) loans and stimulus checks have been a big factor in keeping us afloat," he said. "But they have also provided us with a false sense of security going forward."
Debate on the House budget is expected to get underway in two weeks.
Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group’s newspapers and websites. Email him at email@example.com