State Aid To Reading Falls Short For FY 2019

With a potential override vote just hours away, Reading officials received another dose of bad financial news, this time from the state.

State Aid is a critical part of the revenue needed for town and school services for Reading and makes up approximately 15 percent of the revenue for the combined total Town and School Budget. Late last week the town received news on what it would be getting for FY19 and the figure is $178,000 less than expected.

Unrestricted General Government Aid is $3.35 million or a 3.5 percent increase over the current year. That 3.5 percent increase is proposed for all communities in the Commonwealth. The bad news is that the Chapter 70 (School) funding is $10.67 million or just 0.8 percent increase over the current fiscal year. That increase is inversely related to a community’s ability to pay, so Reading received only a small increase.

“For the last five years, Reading has only received the “hold harmless” amount for Chapter 70 funding, which equals approximately $25 per student,” said Superintendent of Schools Dr. John Doherty.

In total, including other smaller components, overall State Aid for the fiscal year beginning this July increased 1.2 percent, or about $178,000 below Reading's revenue forecast. This continues a 20-year pattern of shortfalls in State Aid even compared to the 2.5 percent annual limitation imposed on property tax growth.

“We understand that the state government faces some of the same financial challenges as we do at the local level. We also gratefully acknowledge that both Governor Charlie Baker and Lieutenant Governor Karen Polito, as former Selectmen in their respective communities, have a full understanding of local concerns,” said Town Manager Bob LeLacheur, Jr. “We appreciate other tools they have brought to us to help control some costs, we enjoy a very strong working relationship with their Administration, but we share their concern about the financial health of local governments.”

Both the Massachusetts House and Senate are at work developing their versions of the budget, and ultimately a final budget will not be expected for several months. Realistically without new revenues for the State budget, we do not expect much change in this 1.2 percent figure.