Joint Ways and Means hears governor's $1.32 billion fair-share surplus plan, focused on MBTA reserves and education supports

House and Senate leaders convened the Joint Committee on Ways and Means on May 20 for a public hearing on House Bill 55, the governor's supplemental proposal to spend $1.32 billion in surplus Fair Share surtax revenue collected in fiscal year 2025.

The administration said the bill would direct a majority of the surplus toward transportation needs including a $300 million MBTA stabilization reserve and a $400 million Federal Transit Administration (FTA) safety reserve, while directing the remainder to education programs such as preschool expansion, early literacy tutoring and career and technical education.

Why it matters: The Fair Share surtax (the ballot measure approved by voters in 2022) was intended to be split between education and transportation. Legislators and administration officials told the committee they are treating House Bill 55 together with the governor's FY26 (House 1) budget so the total package moves the Commonwealth closer to a 50/50 balance while using surplus funds to address near-term transportation risks and a set of one-time education priorities.

The hearing opened with Representative Aaron Mikowitz, who identified himself as the House chair, and Senator Mike Rodericks, who identified himself as the Senate chair, outlining the committee's plan to hear from administration secretaries and outside stakeholders on the governor's surplus proposal. Representative Mikowitz told the committee the panel would "hear House Bill 55, the Governor's proposal on how to spend the more than $1,300,000,000 in surplus from the FY '25 fair share revenue." Representative Mikowitz also encouraged written testimony from members of the public.

Administration summary

Secretary Matthew Gorkowitz, who testified as Secretary for Administration and Finance, told the committee the bill would appropriate $1.3 billion in surplus surtax revenue collected in excess of the consensus revenue estimate for FY24. "This bill proposes to spend a total of 857,500,000.0 for transportation and 462,500,000.0 for education," he said, and emphasized the administration's view that the supplemental and the FY26 House 1 budget should be considered as a package to achieve an overall 50/50 split between transportation and education when both are taken together.

Transportation priorities

Monica Tibbits-Nutt, Secretary and CEO of the Massachusetts Department of Transportation (MassDOT), testified that the governor's supplemental directs one-time resources to stabilize transit operations and boost local infrastructure. She described proposed allocations included in testimony: $400 million for an FTA safety reserve to protect federal grant matching and payroll costs; $300 million to replenish an MBTA stabilization reserve; $67 million to continue an MBTA low-income fare relief program; $25 million for a winter resilience assistance program for municipalities; $25 million for regional transit authority (RTA) workforce initiatives including CDL assistance; $17.5 million to strengthen MassDOT's workforce and project delivery capacity; and $10 million for micro-transit and last-mile innovation grants.

Secretary Tibbits-Nutt said these steps are meant to "protect and maximize our share of critical federal funding" and to stabilize the MBTA ahead of FY26, when the administration projects an operating gap absent supplemental action.

Committee members from Western and rural regions repeatedly pressed the administration on regional equity. Representative David Smola and others expressed concern that the supplemental appears to concentrate large sums for MBTA stabilization while RTAs and municipal transportation needs — chapter 90 road and bridge funds, small bridge and culvert programs, and microtransit support — receive smaller allocations. Administration witnesses argued the House 1 operating and capital proposals must be viewed alongside the supplemental to see the full set of transportation investments, including a proposed multi-year chapter 90 reform to provide larger, predictable annual aid for municipalities.

Education priorities

Secretary of Education Pat Tutwiler laid out the education components the administration supports in the supplemental and the broader FY26 package. Testimony included these proposals: $50 million to support the Commonwealth Preschool Partnership Initiative (CPPI) and related preschool expansion (sampled as a $25 million FY25/26 maintenance allotment plus additional multi-year expansion funds), $25 million for early literacy high-dosage tutoring intended to serve about 10,000 students, $30 million for adult basic education and ESOL services, $32.5 million for early college and innovation career pathway investments, and $75 million to add roughly 3,000 seats to career and technical education programs over three years. Secretary Tutwiler also discussed increases to the special education circuit breaker and transportation reimbursement rates in the FY26 proposal.

Federal grant timing and short-term pressures

Members of the committee and administration witnesses discussed recent federal developments. Secretary Tutwiler described a U.S. Department of Education notice that approximately $106 million in ESSER (federal pandemic) funds previously awarded to about 20 Massachusetts districts were at risk of being rescinded after extensions, an action that would create near-term challenges for districts relying on those funds for facilities upgrades, high-dosage tutoring and mental health supports. Witnesses said the administration was working with affected districts and with the attorney general to determine legal and programmatic options.

Outside testimony and perspectives

Representatives from unions, business groups, the Massachusetts Taxpayers Foundation, municipal officials and transportation and equity advocates testified. AFT Massachusetts President Jessica Tang urged using Fair Share dollars to protect public education from federal cuts and to backfill rescinded ESSER funds. The Massachusetts Taxpayers Foundation urged using surtax dollars primarily for one-time capital and innovation uses and recommended a multiyear plan to stabilize MBTA operating funding while warning against committing recurring operating obligations to a revenue stream with volatile capital-gains-like behavior. A Better City and T4Mass (a coalition of community transportation advocates) both supported stabilizing the MBTA but each emphasized the need for clearer guarantees and more funding for RTAs and municipal road programs.

What the committee heard about next steps

Committee chairs and administration officials said they will continue to work together as the House and Senate write budgets in the coming weeks. The administration asked members to consider the supplemental in concert with the FY26 House 1 budget, which it said contains additional operating and capital proposals that change the overall sectoral balance. Members asked for additional data on per-rider spending for MBTA versus RTA systems, for more detail on grant-eligibility and technical assistance for smaller RTAs, and for a public tracking dashboard of surtax commitments and transportation bond/securitization plans.

Ending note

No formal votes were taken at the hearing. Committee leaders closed the session after a full day of testimony and questions and scheduled follow-up budget hearings on FY26 items. The hearing record shows consensus on two themes: the need to shore up the MBTA's near-term fiscal stability and continuing pressure from legislators to demonstrate stronger, earlier investments in RTAs, chapter 90 and small bridge/crossing resilience in both the supplemental and the FY26 budget.