Good afternoon!
This week, House and Senate negotiators released their supplemental budget conference committee report, reaching agreement on several education investments in both FY26 and FY27.
As a reminder, we have consistently viewed the supplemental budget and the FY27 budget as two pieces of the same puzzle. While they move through separate legislative vehicles, both budgets work together to address many of the fiscal challenges facing school districts, making it important to evaluate them as a combined investment in public education.
While today’s update focuses on the supplemental budget agreement, we will follow up in the coming days with guidance on key FY27 budget priorities and opportunities for advocacy as negotiations continue in the budget conference committee.
It is widely expected that the supplemental budget conference committee report will pass both chambers and be sent to the Governor without further changes.
Best,
Anthony Andronico
Operations & Public Affairs
MASC
Items Funded in the Supplemental Budget
Special Education Reimbursement Fund: Funded at $152M, adopting the House figure rather than the Senate’s proposed $200M. Similar to last year, the legislature is using the Supplemental Budget to make an initial, partial investment in this line item. With $152M allocated already, the House and Senate have each proposed an additional $653M in the regular budget for this line item. If the legislature passes those figures, the final number would be close to $805M which would be up from last year’s appropriation of $675M.
Green School Works: Funded at $25M. The Governor and Senate did not fund this program, while the House provided $20M in its supplemental budget and an additional $5M in its FY27 budget proposal. As a result, we do not anticipate additional funding through the FY27 conference committee process. This item was funded at $20M in the previous fiscal year.
Early Literacy & High-Dosage Tutoring: Funded at a collective $40M (split evenly between the two line-items). The Governor had proposed a combined $50M, the Senate $40M, and the House elected not to fund the initiatives. The $40M investment represents level funding year over year.
School District Regionalization and Shared Services Grant Program: Funded at $16.5M. The Senate proposed $25M, while neither the Governor nor the House funded the program. This is a net new initiative.
Rural School Aid: Funded at $8M total, with $4M allocated to FY26 and $4M allocated to FY27, matching the Senate’s proposal in both years. The FY26 funding brings total Rural School Aid funding to $16M, consistent with FY25 levels. Looking ahead to FY27, the House budget includes $10M while the Senate budget includes $16M. We remain hopeful that the FY27 budget conference committee will adopt the Senate figure, which would bring total FY27 Rural School Aid funding to $20M.
Adult Basic Education and Workforce Readiness: Funded at $5M, consistent with all budget proposals. This line-item is new this year and will be used to supplement line item 7035-0002 Adult Basic Education.
Regional School Transportation Reserve (FY26): Funded at $3M, this funding is to sure up existing FY26 accounts and does not impact FY27.
Mental Health Supports and Wraparound Services: Funded at $2.5M, matching the Senate supplemental budget proposal. Additional movement remains possible in the FY27 budget process, given the Senate’s additional $2M FY27 allocation. The FY26 projected spend on this item is $4.66M.
Civics Education Grants: Funded at $2.05M, matching the House supplemental budget proposal. No other branch proposed funding. This would serve as an initial investment in civics programs – an additional $2.5M-$2.75M is on the table in the regular FY27 Budget. Projected FY26 spending on this category is $4.2M.
Cell Phone-Free Public Schools Grant Program: Funded at $1M, matching the Senate supplemental budget proposal. Neither the Governor nor House included funding. This is a net new initiative.
Outside Section – Mitigating Federal Tax Changes: The conference committee report contains several provisions that phase in implementation of conformity to tax policy changes included as part of the federal One Big Beautiful Bill Act (OB3) signed into law last July. The Healey Administration has indicated that, without legislative action, these federal tax conformity changes could reduce state revenues by approximately $442M in the current fiscal year and more than $250M annually thereafter. This outside section would mitigate those impacts. The conference report includes provisions that would pause these tax changes if the proposed ballot question to lower the State’s income tax from 5% to 4% were to pass in November, which would help mitigate the expected loss in revenue that the ballot question would inflict.
Items Proposed in Supplemental Budget but Not Funded
DESE Targeted Assistance for School Districts: The Governor proposed $10M for this initiative, but both the House and Senate declined to fund the item.
Special Education Circuit Breaker Reimbursement: The Senate proposed an additional $32M. The proposal was not included in the final supplemental budget. Given that the Governor, House, and Senate are all within approximately $1M of one another on this item in their FY27 budget proposals, it is unlikely this funding will reemerge during future FY27 negotiations.