Bill S.2548

FILED ON: 1/8/2024

SENATE . . . . . . . . . . . . . . No. 2548

The Commonwealth of Massachusetts

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In the One Hundred and Ninety-Third General Court
(2023-2024)

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An Act to provide for competitiveness and infrastructure investment in Massachusetts.

Whereas, The deferred operation of this act would tend to defeat its purposes, which are to enhance the competitiveness of Massachusetts in winning federal funds and to provide for the infrastructure needs of the Commonwealth, each of which is immediately necessary to accomplish important public purposes, therefore it is hereby declared to be an emergency law, necessary for the immediate preservation of the public convenience.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:

SECTION 1. The first paragraph of section 2H of chapter 29 of the General Laws, as appearing in the 2022 Official Edition, is hereby amended by striking out the first sentence and inserting in place thereof the following sentence:- There shall be established and set up on the books of the commonwealth a separate fund to be known as the Commonwealth Stabilization Fund, consisting of amounts transferred to the fund in accordance with sections 5C and 5G, amounts credited under this section, income derived from the investment of amounts in the fund and any appropriations or other amounts transferred to the fund.

SECTION 2. Said chapter 29 is hereby further amended by inserting after section 2DDDDDD the following section:-

Section 2EEEEEE. (a) There shall be established and set up on the books of the commonwealth a separate, non-budgeted special revenue fund to be known as the Commonwealth Federal Matching and Debt Reduction Fund. The secretary of administration and finance shall administer the fund.

The fund shall be credited with: (i) interest earned in each fiscal year on the investment of money in the Commonwealth Stabilization Fund established in section 2H, subject to subsection (b); (ii) any appropriations or other money designated to be credited to the fund; and (iii) interest earned on any amounts in the fund. Amounts credited to the fund shall be expended without further appropriation. Any unexpended balance in the fund at the end of a fiscal year shall remain available for expenditure in subsequent fiscal years. No expenditure made from the fund shall cause the fund to be in deficit at any point.

(b) Quarterly, the comptroller shall transfer interest credited to the Commonwealth Stabilization Fund during the previous quarter to the fund; provided, however, that no such transfer shall occur if: (i) the balance of the Commonwealth Stabilization Fund for the most recently ended fiscal year has decreased below the balance of the Commonwealth Stabilization Fund at the close of the immediately preceding fiscal year as certified by the comptroller in the statutory basis financial report required by section 12 of chapter 7A; or (ii) the balance of the Commonwealth Stabilization Fund does not exceed 10 per cent of budgeted revenues for all budgeted funds and other financial resources pertaining to the budgeted funds for the preceding fiscal year.

(c) Annually, not later than 5 business days after the issuance of the statutory basis financial report required by section 12 of chapter 7A, the comptroller shall report to the executive office for administration and finance, the clerks of the senate and the house of representatives and the senate and house committees on ways and means on: (i) the balance of the Commonwealth Stabilization Fund as of June 30 of the preceding fiscal year; and (ii) the interest earned by the Commonwealth Stabilization Fund during the preceding fiscal year.

(d) The secretary of administration and finance may expend money from the Commonwealth Federal Matching and Debt Reduction Fund, without further appropriation, for: (i) repaying, prepaying, defeasing, retiring, tendering, purchasing, reducing the principal or interest payable on or otherwise reducing any portion of the commonwealth’s indebtedness; (ii) reducing, repaying or retiring any portion of the commonwealth’s long-term liabilities including, but not limited to, pension obligations, other post-retirement benefits, capital leases, general or special obligation contract liabilities and equivalent liabilities; and (iii) transferring any amounts in the fund to the Commonwealth Stabilization Fund.

(e) The secretary of administration and finance shall provide quarterly reports to the clerks of the senate and the house of representatives and the senate and house committees on ways and means on the activities of the Commonwealth Federal Matching and Debt Reduction Fund for the preceding fiscal quarter.

SECTION 3. Section 5G of said chapter 29 is hereby amended by striking out the first paragraph, as appearing in the 2022 Official Edition, and inserting in place thereof the following 2 paragraphs:-

After each quarter, the department of revenue shall certify to the state comptroller the amount of tax revenues estimated to have been collected during the preceding quarter from capital gains income. If the department of revenue certifies that the amount of tax revenues estimated to have been collected from capital gains income exceeds $1,479,221,303 in a fiscal year, the comptroller shall transfer quarterly any such amount that exceeds $1,479,221,303 collected during that fiscal year as follows:

(i) if such amount that exceeds the threshold is not more than 10 per cent of budgeted revenues for all budgeted funds and other financial resources pertaining to budgeted funds for the preceding fiscal year: (A) 90 per cent of such amount shall be transferred to the Commonwealth Stabilization Fund established in section 2H; (B) 5 per cent of such amount shall be transferred to the State Retiree Benefits Trust Fund established in section 24 of chapter 32A; and (C) 5 per cent of such amount shall be transferred to the Commonwealth’s Pension Liability Fund established in subsection (e) of subdivision 8 of section 22 of chapter 32;

(ii) if such amount that exceeds the threshold is more than 10 per cent but not more than 15 per cent of budgeted revenues for all budgeted funds and other financial resources pertaining to budgeted funds for the preceding fiscal year: (A) 50 per cent of such amount shall be transferred to the Commonwealth Stabilization Fund established in said section 2H; (B) 25 per cent of such amount shall be transferred to the State Retiree Benefits Trust Fund established in said section 24 of said chapter 32A; and (C) 25 per cent of such amount shall be transferred to the Commonwealth’s Pension Liability Fund established in said subsection (e) of said subdivision 8 of said section 22 of said chapter 32;

(iii) if such amount that exceeds the threshold is more than 15 per cent but not more than 22.5 per cent of budgeted revenues for all budgeted funds and other financial resources pertaining to budgeted funds for the preceding fiscal year: (A) 10 per cent of such amount shall be transferred to the Commonwealth Stabilization Fund established in said section 2H; (B) 45 per cent of such amount shall be transferred to the State Retiree Benefits Trust Fund established in said section 24 of said chapter 32A; and (C) 45 per cent of such amount shall be transferred to the Commonwealth’s Pension Liability Fund established in said subsection (e) of said subdivision 8 of said section 22 of said chapter 32; or

(iv) if such amount that exceeds the threshold is more than 22.5 per cent of budgeted revenues for all budgeted funds and other financial resources pertaining to budgeted funds for the preceding fiscal year: (A) 50 per cent of such amount shall be transferred to the State Retiree Benefits Trust Fund established in said section 24 of said chapter 32A; and (B) 50 per cent of such amount shall be transferred to the Commonwealth’s Pension Liability Fund established in said subsection (e) of said subdivision 8 of said section 22 of said chapter 32.

The threshold of $1,479,221,303 established in this section shall be adjusted annually to reflect the average annual rate of growth in United States gross domestic product over the preceding 5 years based on the most recently available data published by the Bureau of Economic Analysis in the United States Department of Commerce.

SECTION 4. Notwithstanding any general or special law to the contrary, quarterly, the secretary of administration and finance shall submit interim reports to the clerks of the senate and the house of representatives and the senate and house committees on ways and means on expenditures from the Commonwealth Federal Matching and Debt Reduction Fund made pursuant to clauses (i) to (iii), inclusive, of section 5. The report shall include, but not be limited to: (a) a detailed list of capital projects receiving money from the fund and for each project: (i) projected total project cost; (ii) information on funding sources; and (iii) projected timeline for completion; and (b) a detailed list of federal funding applications and the status of those applications. The secretary shall issue a final report not later than December 31, 2026.

SECTION 5. Notwithstanding section 2EEEEEE of chapter 29 of the General Laws, the secretary of administration and finance may expend from the Commonwealth Federal Matching and Debt Reduction Fund established in said section 2EEEEEE of said chapter 29: (i) not more than $750,000,000 for matching funds for federal programs, including, but not limited to, projects and programs included in the Infrastructure Investment and Jobs Act of 2021, Public Law No. 117-58, the Creating Helpful Incentives to Produce Semiconductors (CHIPS) Act of 2022, Division A of Public Law No. 117-167 and the Inflation Reduction Act of 2022, Public Law No. 117-169, and matching funds for federal programs in the form of grants, loans and other financial assistance to cities, towns, tribes, regional organizations whose membership is exclusively composed of municipal governments, regional planning agencies, community development corporations and other development authorities or agencies and providing technical assistance or otherwise enhancing the competitiveness of federal funding applications under guidelines adopted by the executive office for administration and finance; (ii) not more than $50,000,000 for matching funds for federal programs in the form of grants, loans and other financial assistance to cities, towns, tribes, regional organizations whose membership is exclusively composed of municipal governments, regional planning agencies, community development corporations and other development authorities or agencies; and (iii) not more than $12,000,000 for planning and studies, preparation of plans and specifications and technical assistance to support cities, towns, tribes, regional organizations whose membership is exclusively composed of municipal governments, regional planning agencies, community development corporations and other development authorities or agencies in pursuit of federal funding opportunities, under guidelines adopted by the executive office for administration and finance. The secretary shall provide technical assistance and guidance to cities, towns, tribes and regional organizations on the availability of state matching funds for federal programs eligible under this section. The secretary shall not obligate any funds under this section on or after December 31, 2026.