As Expected, Melrose Getting Additional $300K In Local Aid

Melrose will receive an additional $300,000 in local aid this fiscal year, the city's state delegation has announced, a move expected due to a clause included in the fiscal 2012 Massachusetts budget passed earlier this summer that sends unspent state funds back to cities and towns.

Rep. Paul Brodeur, D-Melrose, said that the Legislature "did kind of anticipate this" when passing the fiscal 2012 budget, which included $65 million in local aid cuts, but also the proposal to send unspent funds back to municipalities.

"The comptroller essentially has to certify that’s what’s left over, then we will push out the money," Brodeur said. The Legislature approved the move in a supplemental spending bill that passed last week and closed the books on fiscal 2011.

The additional money restores almost three-quarters of the $411,797 net local aid cut that hit Melrose in this year's budget. Mayor Rob Dolan said the city is treating the influx of aid as one-time money that can't be counted on in next year's budget, and thus won't be spent on hiring staff, which requires an ongoing financial commitment.

Dolan said the money has not been earmarked for anything, but could possibly be used for various capital projects.

"It’s a good sign that they feel confident to give that to us," he said. "If you look at last month's state revenues, they were up a little bit. It tends to be more stable than the rest of the country right now."

The Massachusetts Department of Revenue reported revenues up 9 percent— $178 million—for the month of September, which Revenue Commissioner Amy Pitter attributed to income tax cash estimated payments and withholding collections exceeding projections.

Sen. Katherine Clark, D-Melrose, said that the increased revenues "definitely means that the state was gaining ground," but that legislators will have to watch the effects of the market on revenues in the next quarter.

"We were able to put this money back, which leaves communities without a cut in their local aid this year, which is really good news in this economy," Clark said. "Going forward, we just have to watch this very fragile recovery and do everything we can to get money back to our communities, but it’s certainly not a guarantee that we’ll continue at this rate of growth in revenues."

Brodeur added that a "provision in the law baked in a long time ago" provides that if the state hits a certain revenue growth rate, the income tax rate would automatically reduce from 5.3 percent to 5.25 percent.

"It looks like revenues are robust enough that we’re going to hit that trigger," he said.