FY26 Budget Update
I am writing to you with an important update. On June 30, 2025 the Massachusetts Legislature enacted a $61.01 billion state budget for Fiscal Year 2026 (FY26). I am proud to have voted in favor of this fiscally responsible bipartisan plan that protects core services for the state’s most vulnerable residents, while positioning the Commonwealth to confront the underlying budget challenges that are the result of federal funding uncertainty.
I am also proud to announce that this budget maintains critical state investments while preserving the state’s stabilization fund at a historic $8.1 billion, and importantly, raises no taxes on residents and businesses.
The budget leaves $800 million unspent, so that we can prepare for budget cuts coming from the federal government.
The Legislature’s budget invests an additional $33 million in the Commonwealth Stabilization Fund . With the addition, the Fund’s balance would reach a historic high of $8.26 billion by the end of FY26. Since 2017, when the Fund’s balance was $1.3 billion, the Legislature has grown the account by 523 percent as of FY24. Due to strong Fair Share surtax revenue collections to date, the Legislature’s budget includes $2.4 billion in available Fair Share generated revenues to support education and transportation investments.
Investments from the Legislature's FY26 Budget include:
Education:
The Legislature’s FY26 budget supports students of all ages by maintaining investments in public education at every level. The budget fully funds the fifth year of the Student Opportunity Act, provides a historic funding commitment to the Department of Early Education and Care (EEC), and stands with public and private institutions of higher education at a volatile time.
This includes a $1.7 billion total investment in early education and care which will support the sector’s workforce, protect programming and maintain access to affordable care for families facing economic pressures. The budget also makes $7.36 billion in chapter 70 state aid to public schools, which is a $460 million increase over FY25 and increases the minimum chapter 70 to $150 per pupil.
Public Health and Family Care:
The Senate’s FY26 budget funds MassHealth at $22.1 billion, an increase of over $2 billion over the last fiscal year. Amid ongoing uncertainty in Washington, this budget maintains access to comprehensive health care coverage for over 2 million Massachusetts residents.
As the largest cost driver in the state’s budget, MassHealth alone accounts for 62 per cent of the total spending increase over the FY25 budget. MassHealth covers affordable, accessible, and comprehensive health care services for more than one in four residents, nearly half of all children, and seven out of every ten nursing facility residents.
Housing:
This budget invests more than $1.15 billion in housing initiatives, dedicating resources for housing stability, residential assistance, emergency shelter services, and homelessness assistance programs. These investments are made as increasing affordable housing opportunities and addressing housing challenges remain at the forefront of the Legislature’s agenda and part of the state’s vision for a more fiscally sustainable future.
Fair Share Investments:
The Legislature’s budget includes $2.4 billion in Fair Share surtax spending, which is dedicated to investments in public education and state transportation infrastructure.
This budget makes a direct investment of $470 million in the Massachusetts Bay Transportation Authority (MBTA). The funding will support MBTA operations, including key initiatives like low-income fare relief, water ferry service and the MBTA Academy. Combined with the $535 million in funding from the recently passed Fair Share supplemental budget, the Legislature provides $1 billion in new investments in FY26 for operational improvements and transportation infrastructure upgrades across the MBTA system.
The budget also makes key investments in Regional Transit Authorities. Education investment highlights include Commonwealth Cares for Children grant program, Student Opportunity Act and universal free school meals.
Community Support:
Highlighting the Legislature’s longstanding commitment to sustainable partnerships between the state and local governments, the budget agreement provides significant resources to support all Massachusetts cities and towns, ensuring that the state can meet the needs of every region, city, and town—and leave no corner of the Commonwealth behind.
The proposal includes $1.323 billion in funding for Unrestricted General Government Aid (UGGA), the primary source of direct flexible state aid to Massachusetts towns and cities, an increase of $14.4 million over FY25. UGGA funding supports resources for municipalities as they collectively confront increased fiscal constraints at the local level.
In addition to traditional sources of local aid, the Legislature’s FY26 budget also increases payments in lieu of taxes (PILOT) for state-owned land to $54.5 million. PILOT funding provides a supplemental source of local aid for cities and towns working to protect and improve essential services and programs.
Expanding and Protecting Opportunities
The Legislature is committed to expanding opportunity and supporting the state’s most vulnerable residents. This budget therefore maintains the annual child’s clothing allowance, providing $500 per child for eligible families to buy clothes for the upcoming school year. The budget also fully annualizes the FY25 10 per cent increase to Transitional Aid to Families with Dependent Children (TAFDC) and Emergency Aid to the Elderly, Disabled and Children (EAEDC) benefit levels to help families move out of deep poverty. Additionally, the budget ensures that pregnant women can access TAFDC, regardless of where they are in their pregnancy.
The Legislature’s budget dedicates $86 million to support food security and child nutrition initiatives, including $50.5 million for Emergency Food Assistance to assist residents in navigating the historical levels of food insecurity, $20.1 million for the Healthy Incentives Program (HIP) to ensure access to healthy food options, and $15.5 million for the Women, Infants, and Children (WIC) Nutrition Program.
For further details on the Legislature’s FY26 Budget, please see the official press release linked here.
As always, if you have any questions about the budget, the legislative process or any other matters of importance to you, please do not hesitate to reach out to my office.