(BOSTON 7/3/2026) — Without raising taxes on Massachusetts residents, the Massachusetts Legislature this week delivered a Fiscal Year 2027 budget that drives down costs for residents, boosts the state's economy, and adds to the state’s savings account.
The plan makes record investments in public education, unlocks new housing production, strengthens the state’s public transportation systems, and protects vulnerable residents from the impact of federal cuts.
The bill spends $63.4 billion, a 4 percent increase from last year, and includes $2.7 billion in Fair Share funds that will support public education and transportation as voters intended. The budget raises no taxes and adds $51 million to the state’s ‘Rainy Day’ Stabilization Fund, which is projected to reach a historic $8.2 billion balance by the end of Fiscal Year 2027.
“Recent years have been defined by an era of uncertainty – uncertainty about our economic prosperity, uncertainty about the direction of our federal government, uncertainty about our future. But here in Massachusetts, we have something we can be certain about; our state-supported programs will remain funded without raising taxes on everyday Bay Staters,” said Senator Michael Moore (D-Millbury). “The record investments in our communities delivered by this FY27 budget is a testament to the responsibility and resilience of our people, and I could not be more thrilled to share the news that Massachusetts will not be leaving anyone behind. I’d like to thank my colleagues in the Legislature for their hard work on this bill, and I look forward to seeing it signed by the Governor.”
During Senate debate, Senator Moore secured amendments for the cities and towns in his district and beyond. They include:
Regional
$500,000 for Veterans Inc. to support its employment training and substance use treatment programs.
$250,000 to fund cancer screenings for firefighters in cities and towns across the Commonwealth.
$250,000 for EcoTarium to support the care of animals, expand community education programs, and fund animal habitat improvements.
$25,000 to the Latin American Health Alliance of Central Massachusetts to support its substance use recovery programs.
$20,000 for CASA Project Worcester County to support its efforts to provide legal representation to vulnerable children during court proceedings.
Auburn
$55,000 for the Town of Auburn to purchase a 3D laser scanner for its Traffic Crash Reconstruction Unit.
$20,000 for Auburn Youth and Family Services to support its community food pantry program.
Millbury
$75,000 for the Millbury Police Department to purchase a K9 police cruiser.
Grafton
$130,000 for Grafton Public Schools to upgrade classroom technology and purchase an activity van (passed as part of the recent Fair Share Supplemental Budget).
Shrewsbury
$150,000 for the Shrewsbury Police Department to purchase a police boat for use on Lake Quinsigamond.
Westborough
$60,000 for Westborough Public Schools to purchase cell phone lock boxes, creating phone-free classrooms.
Worcester
$75,000 for the Worcester Police Department to purchase a K9 police cruiser.
$20,000 for the New Americans Community Development Corporation to support the development of affordable housing within Worcester’s Main Middle neighborhood.
Education
The agreement completes the Legislature’s commitment to fully fund and implement the Student Opportunity Act with $7.66 billion in Chapter 70 aid to public school districts, an increase of $297 million over Fiscal Year 2026 and the highest level ever, along with a record $160-per-pupil minimum in local school aid.
The budget also revives the Foundation Budget Review Commission (FBRC) to examine the K-12 funding formula and assess how the state can address rising costs in special education, student transportation, personnel, and educator health care statewide.
The agreement funds the Special Education Circuit Breaker at $654.6 million to help students who need support, which, combined with $152 million from the recent Fair Share supplemental budget, brings the total investment to $806.6 million, reimbursing school districts for 75 percent of the costs of educating students with disabilities and complex needs.
Other education investments include $475 million for the Commonwealth Cares for Children (C3) grant program to support early education and care providers’ day-to-day operational and workforce costs, $137 million for the MassEducate and MassReconnect free community college programs, $20 million for rural school districts, and $180 million for universal free school meals, which serve nearly 150 million free meals to Massachusetts kids every year.
The budget also includes $11.7 million to support students receiving special education services through the DESE/DDS Residential Prevention Program, and $2 million for a new grant program helping schools address young people’s social media use.
Transportation
The agreement provides $465 million in direct investment for the MBTA, which, combined with $595 million from the recent Fair Share supplemental budget, brings the total new investment in the system to over $1 billion for Fiscal Year 2027. It also includes $217 million for Regional Transit Authorities (RTAs), including $40 million to sustain fare-free transit service statewide. The state’s fare-free Regional Transit program has resulted in ridership exceeding pre-pandemic levels.
The budget also responds to a string of fatal wrong-way driving incidents on Massachusetts highways, including the tragic line-of-duty death of State Trooper Kevin Trainor, by directing MassDOT to implement new infrastructure and officer training, including directional striping, signage, lane delineators, and motorist alert systems.
Municipalities and Housing
The agreement provides record support to cities and towns across the state, including $1.363 billion for Unrestricted General Government Aid (UGGA), a $40 million increase over Fiscal Year 2026 and the highest level ever. For new dollars, the legislation implements a new funding formula to equitably distribute the increase throughout all of the state’s 351 communities.
In another step toward addressing the housing crisis and building homes faster statewide, the budget builds on last session’s Affordable Homes Act by streamlining local permitting, supporting development on nonconforming properties, providing reasonable timelines for projects under existing zoning, and modernizing the variance standard, all aimed at boosting housing production and driving down costs.
Health Care
The agreement extends the ConnectorCare expansion pilot program through 2027. Since 2024, the pilot has helped more than 115,000 residents access more affordable insurance through lower premiums, no deductibles, and reduced co-pays.
The budget also codifies existing federal protections requiring comprehensive insurance coverage of HIV pre-exposure prophylaxis (PrEP) without cost sharing or utilization management barriers and directs a new study to modernize and improve the long-term sustainability of emergency medical services in the Commonwealth.
Retiree COLA Reform
This budget includes comprehensive, fiscally prudent reforms to cost-of-living adjustments (COLAs) for retired public employees, based on recommendations from the Special COLA Commission. It establishes a COLA Reserve Fund financed in part by pension investment returns above target, provides enhanced COLA benefits for certain current retirees based on years in retirement, and allows the base amount used to calculate future COLAs to increase in $1,000 increments as funding allows.
Food and Economic Security
The agreement protects access to benefits through Transitional Aid to Families with Dependent Children (TAFDC) and Emergency Aid to the Elderly, Disabled and Children (EAEDC), and includes a $500 clothing allowance per child for families receiving TAFDC benefits.
It repeals the Learnfare law, which cut off TAFDC benefits when children had too many unexcused school absences and ended up hurting families who lost needed assistance.
It also provides $56.1 million for Emergency Food Assistance, an increase of $6.1 million over Fiscal Year 2026, and $21.5 million for the Healthy Incentives Program (HIP), which supports local farmers and access to healthy food.
Protecting Vulnerable Residents
The agreement includes provisions protecting children aged 16 and 17 from sexual interactions with mandated reporters and others responsible for their care and oversight, including teachers, coaches, police officers, and social workers.
In response to the tragic fire at Gabriel House in Fall River, the agreement provides $500,000 to implement recommendations from the Assisted Living Residences (ALR) Commission to improve safety standards, emergency preparedness, and oversight at assisted living facilities statewide.
The budget also establishes a commission to study transitional youth services for individuals with disabilities whose access to special education services will end due to high school graduation or turning 22, as the Legislature works to preserve community-based care options amid federal challenges to the Olmstead decision.
Sports Wagering Revenue
The agreement adjusts the distribution of sports wagering revenue, directing 5.5 percent to the Sports and Entertainment Fund and 2 percent to the Economic Development Trust Fund, dedicating new resources to support the Commonwealth’s economic growth.
The full text of the Fiscal Year 2027 budget is available online.
Having been passed by the Legislature, the bill has been sent to Governor Healey for her signature.
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