iStock photo

Senate Democrats rolled out a $55.8 billion state budget bill Tuesday, leaving room for about $575 million in future investments in tax relief, which the Senate budget chief said will be hitting the chamber floor for debate soon.

The Senate Ways and Means Committee’s fiscal 2024 spending plan weighs in at about $3.4 billion, or 6.5 percent, larger than the fiscal 2023 state budget signed by Gov. Charlie Baker last summer. The plan is $300 million over what Gov. Maura Healey proposed, and $400 million under the House’s budget.

The Senate Ways and Means Committee voted 16-0 to recommend the spending plan, an indication that the proposal will likely sail to passage when it hits the Senate floor later this month.

Both the House and Healey’s budgets had factored in a companion tax relief bill, which the governor estimated could have a $1 billion impact to state revenue next fiscal year. The House factored in $587 million next fiscal year for tax relief and up to $1.1 billion after a two-year phase-in period.

Senate leaders have been quiet on whether they would pursue tax relief at all, after state revenue numbers for April released last week showed the amount the state is bringing in plummeted by $2.163 billion from the same month last year. On Tuesday Rodrigues confirmed that the body would be pursuing a tax relief plan and put a hold on the balance sheet to factor in revenue collection impacts from a Senate relief proposal “in the same ballpark as the House.”

Rodrigues did not share any details about the Senate’s tax plan when asked, and did not say that the delay in rolling it out with the budget – a divergence from the tactics used by House and Healey – had to do with April shortfall in tax collections.

“We only got the tax bill from the House, what, two weeks ago? And we just haven’t had time to, we’ve been focusing on putting together the operating budget,” Rodrigues said.

The House tax relief plan, approved on April 13, landed in Rodrigues’ committee three weeks ago, and tax relief has been a subject of continuing debate since last summer, when the House and Senate scrapped their approved targeted tax relief plans due to affordability concerns.

Despite April revenue numbers dipping, state tax collection has surged over the last two fiscal years by nearly 40 percent, accommodating a nearly 11 percent increase in spending in the current budget, although April’s collections appears to have pushed this year’s budget into a revenue deficit.

The Senate committee’s budget plan, which will hit the floor for debate on May 23, moves to spend $1 billion in revenue from a new surtax on high earners, following the House in an even 50-50 split between education and transportation investments.

Despite Rodrigues’s description of the budget as “policy light,” the Senate Ways and Means budget includes 75 outside policy sections, 46 more than proposed by the governor and 18 less than what was included in their proposal last year, according to MTF.

In addition to in-state tuition for undocumented residents, other policy changes include exempting new surtax revenues from counting toward an annual limit on the state’s tax collection, making permanent the COVID-19 eviction diversion program and offering no-cost communications to incarcerated people and their families – all of which the House has also supported, giving them full legislative support. The Small Property Owners Association landlord trade group has opposed the continuation of the diversion program, arguing it drags out evictions past what small landlords an afford, and due to insufficient funds for rental assistance it doesn’t make landlords whole for unpaid rent often enough.