Tax, spending questions abound as Baker readies budget plan

The monthslong process of constructing a state budget begins anew on Wednesday when Republican Gov. Charlie Baker unveils his spending plan for the fiscal year starting July 1.

While Massachusetts' economy is strong and unemployment low, the state's financial picture remains unsettled. Changes in federal health care policies and the fate of two prospective ballot questions are among factors that could have profound budgetary impacts for the state.


Election year politics could also open Baker's budget proposal to greater scrutiny as he launches his bid for a second term.

The governor's spending plan will go first to the House and later the Medicaid program, which already accounts for more than 40 percent of all state spending.


Some of the governor's previous cost-saving measures have been adopted but others, such a proposed shift of 140,000 non-disabled people from MassHealth to subsidized insurance offered through the state's Health Connector, have floundered in the Legislature.



Two new revenue streams will likely emerge in Massachusetts during the next fiscal year: Recreational marijuana sales and resort-style casinos.


Don't expect a huge windfall.

The foundation estimates that the state's first commercial pot shops — expected to begin opening this summer — could generate between $32 million and $54 million in sales and excises taxes for the state.

The state could also realize a $50 million to $70 million cut of casino proceeds from the planned September opening of MGM's resort casino in Springfield and possible June opening of Wynn Boston Harbor.

However, much of the revenue from legal weed and gambling pays for regulating those endeavors, while some is also earmarked for specific purposes and not available for general appropriation.

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