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Senate floor debate breaks over allocation of excess capital gains; amendment to boost rainy day fund fails
Summary
A proposed amendment to direct a larger share of excess capital gains into the Commonwealth Stabilization Fund failed after a roll-call vote. The amendment sought 75% to stabilization, 15% to a deficiency reserve, and 5% each to pension and OPEB funds; opponents argued a newly seeded deficiency reserve was prudent in light of federal tax changes.
Senator (minority leader) offered an amendment to change how excess capital gains revenue is allocated, proposing 75% to the Commonwealth Stabilization Fund, 15% to a deficiency reserve, and 5% each to the pension liability and retiree benefits (OPEB) funds. He argued the statutory treatment (90% to stabilization under chapter 29, section 5G) had been set aside in recent closeout budgets and said a stronger deposit pattern was necessary to protect the Commonwealth from revenue volatility.
Senate Ways and Means leadership and the committee chair opposed the amendment. They defended the bill's proposed use of excess capital gains, arguing the committee’s approach seeds a deficiency reserve (using a larger share of excess capital gains) to prepare for anticipated revenue shortfalls due to recent federal tax-law changes that they said would reduce FY25 revenues by roughly $660 million. They said the reserve can be used only to backfill deficiencies in previously funded accounts and not for new programs.
A roll-call vote was taken. The clerk announced that 5 members voted in the affirmative and 33 in the negative; the amendment was not adopted. The floor debate included extended policy argument about the balance between preserving the stabilization fund and preparing for near-term revenue uncertainty.
