With a soft landing coming for the US economy, the Healey administration has cautious optimism in the state's economic outlook.
Economists say the U.S. has avoided a full-blown recession. Apparently, that is what a soft-landing means. And there are ramifications for the state economy. While, saying he is, “cautiously optimistic” about the economic outlook for the year ahead, Massachusetts administration and Finance Secretary Matt Gorkiewicz is nonetheless mindful of who this soft landing was actually “soft” for. Reporter Chris Lisinksi of the State House News Service tells us what we should know about Massachusetts economic situation.
Chris Lisinski, SHNS: A lot of what Matt Gorkiewicz thinks is on the horizon for the current fiscal year we're in, which runs through June 30th, 2025 is pretty similar to what we saw last fiscal year. And you and I spent a lot of days talking about that because tax revenues collected by the state consistently fell short of expectations.
We ended the year something like $230 million below what the budget called for, once you set aside all of the extra surtax money that was collected, and Secretary Gorkiewicz says he expects those pressures to continue. That along with some unavoidable big expenses on the horizon, as Massachusetts’ continues to deal with big cost drivers like the emergency shelter crisis, which despite some reforms along the way to lessen some of the pressure on the system, is still a major, major cost for the state.
Carrie Healy, NEPM: And yet, Gorkiewicz praised the Federal Reserve's recent decision to cut interest rates and says that it might push more people to participate in the housing market. A wide-ranging economic development bill created to spur new job growth and boost the life sciences and climate technology fields, remains stalled. What do you make of this delay?
The delay at this point is not that surprising, given that they couldn't get to a yes on July 31st. You know, we have heard rumblings that maybe they're getting close. Some of the negotiators have said they think that something could emerge in the next few weeks rather than in the very closing days of December, which is the absolute end of the legislative session.
But that being said, that's all just talk for now. We still have not seen any kind of final product. We have not gotten any details about the work lawmakers have done to bridge the gap.
Switching gears, let's talk about marijuana. What’s the plan for Massachusetts to allow cannabis cafes to open? Leaders at the Cannabis Control Commission say they're working on regulations to govern establishments where adults could use marijuana together in a social setting. It's been a long time in coming. What's the latest?
That's right. The acting Cannabis Control Commission (CCC) chair, Bruce Stebbins, said that he thinks that these regulations could be in place before the end of the year to be presented to the public for social consumption, in the so-called pot cafes is how you've heard them described in the past.
That's a long time coming. Voters approved legalizing adult use marijuana for recreational purposes back in 2016. That ballot question, nearly eight years ago, outlined authority for the CCC to license these sites. It's just taken a long time to get from idea to reality.
Speaking of elections… since August 1st, the end of the formal sessions, legislators meeting without a quorum in either branch have pushed through at least five major bills, like that recent supplemental budget request that authorizes the spending of the last of the federal American Rescue Plan Act funds, and those got to Governor Maura Healey's desk. Do we expect this pace of lawmaking to continue with November's election right around the corner?
Yes and no. I think that there is going to be a point when the Legislature shifts its focus solely to election mode, maybe for a couple of weeks, bookending the November 5th election. Keep in mind as well, that while there has been some movement on business that was unfinished by the time they adjourned, everything they've checked off so far was the easy stuff. They've gotten all the low hanging fruit out of the way. Everything that's left? There are some really significant differences between the House and Senate, so it's just logical that it will take longer to resolve differences on those.
