AN ACT TO PROVIDE FOR COMPETITIVENESS AND INFRASTRUCTURE INVESTMENT IN MASSACHUSETTS
Whereas, The deferred operation of this act would tend to defeat its purpose, which is 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, which shall be administered by the secretary of administration and finance. 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) 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 not revert to the General Fund and shall remain available for expenditure in subsequent fiscal years. No expenditure made from the fund shall cause the fund to be in deficit.
(b) Quarterly, the comptroller shall transfer to the fund any interest credited to the Commonwealth Stabilization Fund during the previous quarter; 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 pursuant to section 12 of chapter 7A; or (ii) the balance of the Commonwealth Stabilization Fund does not exceed 10 per cent of budgeted revenues for the immediately preceding fiscal year, as stated in the most recent statutory basis financial report; and provided further, that if the report for the immediately preceding fiscal year has not yet been issued, the comptroller shall make an estimate of the Commonwealth Stabilization Fund balance and budgeted revenues and other financing sources for the immediately preceding fiscal year.
(c) Annually, not later than 5 business days after the issuance of the statutory basis financial report required pursuant to section 12 of chapter 7A, the comptroller shall report to the executive office for administration and finance, the clerks of the house of representatives and the senate and the house and senate 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 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. The secretary of administration and finance shall provide notice to the clerks of the house of representatives and the senate and the house and senate committees on ways and means not less than 30 days prior to expending funds from the Commonwealth Federal Matching and Debt Reduction Fund, including, but not limited to, the purpose and amount of each expenditure.
(e) Twice per year, not later than December 31 and June 30, respectively, the secretary of administration and finance shall provide reports to the clerks of the house of representatives and the senate and the house and senate committees on ways and means on the activities of the Commonwealth Federal Matching and Debt Reduction Fund for the prior period.
SECTION 3. Notwithstanding any general or special law to the contrary, not later than December 31 and June 30, respectively, until December 2026, the secretary of administration and finance shall report to the clerks of the house of representatives and the senate and the house and senate committees on ways and means on expenditures from the Commonwealth Federal Matching and Debt Reduction Fund for matching funds for federal programs, including, but not limited to, projects and programs included in the Infrastructure Investment and Jobs Act of 2021, also known as the Bipartisan Infrastructure Law, Public Law No. 117-58, the Creating Helpful Incentives to Produce Semiconductors Act of 2022, Public Law No. 117-167, and the Inflation Reduction Act of 2022, Public Law No. 117-169, including expenditures for 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 related to such federal programs.
SECTION 4. Notwithstanding section 2EEEEEE of chapter 29 of the General Laws or any other general or special law to the contrary, the secretary of administration and finance may expend not more than $750,000,000 from the Commonwealth Federal Matching and Debt Reduction Fund established in said section 2EEEEEE of said chapter 29 to provide funding for matching funds for federal programs, including projects and programs included in the Infrastructure Investment and Jobs Act of 2021, also known as the Bipartisan Infrastructure Law, Public Law No. 117-58, the Creating Helpful Incentives to Produce Semiconductors Act of 2022, Public Law No. 117-167, and the Inflation Reduction Act of 2022, Public Law No. 117-169; provided, that not more than $50,000,000 may be expended for matching funds for federal programs in the form of grants, loans and other financial assistance; provided further, that not more than $12,000,000 may be expended 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, pursuant to guidelines adopted by the executive office for administration and finance; and provided further, that on and after December 1, 2026, the secretary shall not obligate any additional funds pursuant to this section.
SECTION 5. There shall be a task force to review and make recommendations relative to: (i) the appropriate long-term level of funding for the Commonwealth Stabilization Fund established in section 2H of chapter 29 of the General Laws; (ii) the appropriate level and means of funding for long-term financial liabilities of the commonwealth; and (iii) amendments to the mechanisms that provide funding for the Commonwealth Stabilization Fund and other long-term financial liabilities, including the provisions of section 5G of said chapter 29. The task force shall review: (i) the statutory threshold for excess capital gains collections established in said section 5G of said chapter 29 in consideration of historical and estimated future capital gains collections; (ii) the disbursement percentages required under said section 5G of said chapter 29; (iii) best practices related to the funding of long-term financial liabilities among states; (iv) best practices related to the funding and size of stabilization funds among states; (v) the impacts of relevant fiscal policies on the commonwealth’s credit ratings; and (vi) any other relevant fiscal factors to ensure the most prudent use of state revenues. The task force shall consider said disbursement percentages in consideration of the relative size or funding level of the Commonwealth Stabilization Fund, the State Retiree Benefits Trust Fund established in section 24 of chapter 32A of the General Laws, the Commonwealth's Pension Liability Fund established in subsection (e) of subdivision 8 of section 22 of chapter 32 of the General Laws and other long-term financial liabilities of the commonwealth. The task force shall consist of the secretary of administration and finance, who shall serve as chair; the state treasurer or a designee; the comptroller or a designee; the commissioner of revenue or a designee; 1 individual appointed by the governor who shall be an expert in public finance and who shall be a resident of the commonwealth; and 1 individual appointed by the state treasurer who shall be an expert in state public finance. The task force shall report on its analysis and issue recommendations to the clerks of the senate and house of representatives not later than June 1, 2025.
SECTION 6. Notwithstanding section 2EEEEEE of chapter 29 of the General Laws or any other general or special law to the contrary, the comptroller shall transfer to the Commonwealth Federal Matching and Debt Reduction Fund, established in said section 2EEEEEE of said chapter 29, any interest credited to the Commonwealth Stabilization Fund during the 4 quarters of the fiscal year ending June 30, 2024.
Approved, September 24, 2024.