Rep. Stanley, MA House Pass Fair Share Supplemental Budget

BOSTON – Wednesday, March 18, 2026 – The Massachusetts House of Representatives passed a $1.8 billion supplemental budget that invests $885 million in public transportation and $417 million in public education, and funds several Fiscal Year 2026 (FY26) deficiencies. The bill passed also includes the tax conformity legislation filed by Governor Healey that phases in the state’s alignment with the corporate tax changes passed by Congress in the OB3 Act last year.

“Using these one-time Fair Share surplus funds is a critical way for the Commonwealth to continue supporting public education and transportation, as well as local organizations in each of our communities, during this time of unprecedented economic uncertainty,” said Representative Thomas M. Stanley (D-Waltham). “I want to thank Speaker Mariano, Chairman Michlewitz, and my House colleagues for their work in making these critical investments throughout the state.”

The bill establishes a schedule for the Commonwealth to conform with the federal corporate tax changes that were passed by Congress in the OB3 Act last year. When fully implemented, these changes will represent a $400 million revenue loss for the Commonwealth.

Under the bill, the Research and Experimental expense deduction will be delayed one year, the deductions for the Modification of Business Interest, Depreciable Asset Expensing, Qualified Production Properties will be delayed two years, and the Modification of Qualified Opportunity Zone Investments program will also be delayed two years. However, should the ballot question to lower the state income tax from 5 percent to 4 percent pass in November, which would result in a $5 billion revenue loss when fully implemented, the Commonwealth would permanently decouple from these tax credits, preventing them from going into effect.

The $1.8 billion bill is funded in part by $1.3 billion from excess Fair Share surtax funds to invest in public transportation and education. Highlights include:

$885 million towards transportation:

• $740 million towards the MBTA

• $525 million for the Deficiency Reserve

• $125 million for the Workforce & Safety Reserve

• $60 million for physical infrastructure with a focus on the core subway system

• $20 million for low-income reduced fares

• $10 million for water transportation infrastructure

• Other transportation items include:

• $50 million for snow and ice costs

• $25 million for Regional Transit Authorities (RTAs) workforce development

• $30 million to fund the Sustainable Aviation Fuel (SAF) Credit

• $30 million for MassDOT Service Investments

$417 million towards education:

• $150 million towards Special Education Circuit Breaker costs

• $150 million to fund Early Education Child Care costs

• $38.7 million for the EEC income eligibility waitlist

• Includes $8 million for child care for providers and $7.5 million for the loan forgiveness program for providers

• $20 million for Green SchoolWorks program to help schools with clean energy upgrades

• $18.3 million for Financial Aid Supplements

• $20 million endowment Match for UMass and other state colleges and universities

• $5.1 million for Tomorrow’s Teachers Loan Forgiveness program

• $5 million for ESOL Services Waitlist

The bill also allocates $507 million from the General Fund:

• $300 million for the Group Insurance Commission (GIC)

• $54.4 million for sheriffs, representing half of the deficiency

• Requires reporting on the expenses of proposed usage of the funds

• $41.6 million for DTA caseworkers

• $10 million for FIFA Boston for World Cup related expenses

The bill also includes the following outside sections:

• Food Donation Tax Credit: Establishes a food donation tax credit for farm businesses based on the amount of food donated to a nonprofit food distribution organization. The credit is capped at $5,000 annually per individual.

• Sustainable Aviation Fuel Credit: Allows taxpayers to take a credit against the tax imposed on fuels used for aircraft propulsion and, subject to limitation, requires the amount of credit per gallon of sustainable fuel to increase by $0.015 for each additional 1 percent reduction in life-cycle greenhouse gas emissions above 50 percent. The credit is capped at $10 million total for all cumulative tax credits over a fiscal year.

• Ratifies eight Collective Bargaining Agreements (CBAs)

The bill passed the House of Representatives 150-3 and now goes to the Senate for consideration.

###