Governor Patrick appeared at the MMA annual meeting today, giving a speech dealing with local aid in his next budget as well as the introduction of a new proposal for municipal health care reform. The Governor told the MMA that he would propose a cut of 7% in unrestricted local aid while proposing an increase in school aid, as well as an increase in road assistance and special education funding.

The Governor’s proposals are consistent with his philosophical view that infrastructure and education funding should be maintained, even in difficult economic times. He has consistently done that, and his recommendations for increases here are truly remarkable in a budget that has a roughly $2 billion dollar shortfall. And while no local official will be happy with a 7% cut in unrestricted local aid the Governor is proposing a grand bargain on health care that would allow locals to withstand the shock of such a cut and preserve services and municipal jobs. The details on that health care proposal are key, as we all know that the devil lies in the details.

The press coverage of the Governor’s speech did not offer details, but Jay Gonzalez, the Secretary of Administration and Finance, offered this in the Globe:

“This proposal is a critical step towards delivering material savings in health care costs to cities and towns at a time when they need it most,” Administration and Finance Secretary Jay Gonzalez said in a statement. “In this challenging fiscal environment, taxpayers can no longer be asked to fund overly generous health benefits at the expense of critical local services.”

The Governor’s proposal seems to mirror that of the Speaker, who unveiled a proposal during his Speaker’s Address last week. If the change does indeed come then the cut in local aid will be sustainable, made up for by lowering municipal costs. Such a strategy has been at the core of the arguments made by Mayors throughout Massachusetts. In Methuen in this fiscal cycle we would have saved $2 million dollars by entering the GIC (The health care plan for state employees). Yes, you read that right. The community is spending an extra $2 million dollars on health care, and that is a conservative estimate. And I can say, without fear of contradiction, that the health care provided by the GIC is both affordable and first rate. For those who argue against such entry the question is this: Why would you impose higher costs on the taxpayers of Methuen? It just does not make any sense fiscally or from a health care perspective. So for today the Governor once again has to be commended, as he again appears to be tackling a difficult problem and taking on special interests for the good of the State and its cities. We will wait to see the proposal in written form, but I am cautiously optimistic.