Massachusetts Passes $61B Budget Just in Time for New Fiscal Year

Massachusetts lawmakers were able to complete work on the state budget before the start of the new fiscal year. That's something they have been unable to accomplish for years.

The House voted 139-6, and the Senate voted 38-2, to adopt the $61 billion budget for Fiscal Year 2026 on Monday, June 30, the day before the start of the new fiscal year.

Governor Healey’s Next Steps

Governor Maura Healey has 10 days to review the budget document to consider any vetoes she might apply to the spending bill before signing it or allowing it to become law without her signature. The process means Massachusetts did not start the new fiscal year on July 1 with a budget in place.

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What’s in the $61B Budget?

State House News Service reported, "The $61 billion budget that landed on Healey's desk would increase spending about $3.3 billion or 5.6% over the version Healey signed last summer, with significant increases for MassHealth, education, and transportation."

Concerns Over Federal Funding Cuts

The Healey Administration and the legislature have been cautious about planning in light of potential reductions in federal funding, as the Trump Administration and Congress have eyed substantial cuts to some programs.

Why Lawmakers Included an $800M Reserve

Even though Massachusetts has some $8 billion stashed in a rainy day account, budget writers were not taking chances when they crafted a compromise budget for FY26.

SHNS reported, "Lawmakers quietly built themselves a roughly $800 million cushion" stashed away inside their budget. The budget approved by lawmakers on Monday "leaves more than three-quarters of a billion dollars budgeted but not spent in the face of uncertainty about federal actions and broader economic trends."

Even with the extra $800 million, I predict the Healey Administration will seek a supplemental spending bill by December or January, halfway through the fiscal year.