Transcript Highlights:

• And then the next section is the payment authority, where we would actually make those payments out of
• updating those systems.
• It has to do with payments, multiple payments coming to the same address, lost checks.
• It's building the system.
• It's building the system.

Committee: House Budget

Transcript Highlights:

• Finally, our agency maintains multiple eligibility and payment systems to deliver our programs such as
• Finally, our agency maintains multiple eligibility and payment systems to deliver our programs such as
• Do we withhold payment?
• Do we withhold payment?
• Do we withhold payment?

Committee: Senate Health and Human Services

Transcript Highlights:

• Program provides payments to thousands of child care providers across the state.
• His leg fracture would not be on video as the system overwrites itself afterward.
• We need to improve our systems.
• The investments that you're making in improving SSIS systems will go a long way.
• We'd like to see the bill include specific language directing the agency to focus on a payment system

Bills: HF2436

Committee: House Children and Families Finance and Policy

Transcript Highlights:

• The court system, which is designed for adults, that case could be transferred to the family court system
• , sound direct payment practices that have been adopted by other state agencies.
• You said that the payments to the veterans remain the same, which is important. Thank you.
• You said that the payments to the veterans remain the same, which is important.
• The state would be on the hook for 100% of the payments.

Committee: Joint Joint Committee on Veterans and Federal Affairs

Summary: The Joint Committee on Veterans and Federal Affairs held its first public hearing of the 2025–2026 session, with House Chair Rep. Joe McGonagle outlining the committee’s focus on veterans’ benefits, military families, and related policy priorities. He noted the committee’s recent record of advancing major veterans legislation, described the hearing as hybrid, and explained that testimony would be limited to three minutes. The committee then heard testimony on several bills, including H. 3886/S. 2503, H. 3863/S. 2480, and H. 3859, among others. Melissa Willett of the Department of Defense and Rep. John Stanley testified in support of H. 3886/S. 2503, which would expand support for military families by improving school open enrollment flexibility, special education continuity, concurrent jurisdiction for juvenile matters on military installations, and coordination around military protective orders. Committee members questioned the juvenile jurisdiction and protective-order provisions, with concerns raised about federal versus state authority and due process; witnesses said the jurisdiction change would be case-by-case and that military protective orders are commander-issued decisions that could be used as evidence in civilian proceedings. The Department of Defense said the proposal aligns with priorities from military stakeholders and other New England states. Jim Keene testified in support of H. 3863/S. 2480, seeking a cost-of-living adjustment for veterans’ benefits and extending certain benefits to Guard and Reserve members killed on active duty. Allie DeBateau of the Massachusetts Municipal Association testified on H. 3859, which would streamline veterans benefits administration by having the state pay benefits directly rather than reimbursing municipalities quarterly; she said this would reduce local administrative burden while leaving local veterans service officers’ roles unchanged. Committee members asked about municipal support and the fiscal impact, and the hearing concluded with no votes taken, followed by adjournment.

Transcript Highlights:

• </c> required to do the prospective payment required to do the prospective payment methodology<00:53:
• </c> state plan uh state directed payment state plan uh state directed payment preprints<00:58:44.319
• </c><01:08:42.400><c> for</c> payments uh double payments made for payments uh double payments made for
• It's the PARIS information system. It's the PARIS system.
• It's the system. them being fraudulent. It's the system.

Summary: The Medicaid Oversight and Advisory Board meeting began with a roll call and approval of the October 7 meeting minutes. The chair then reordered the agenda to hear the item on Medicaid reimbursement rates and network adequacy first because of scheduling issues. Dr. Steve Robertson of the Kentucky Dental Association was sworn in and testified at length about Kentucky’s dental Medicaid program, arguing that reimbursement rates are unsustainably low, have been largely flat for decades, and are often below the cost of providing care. He said Kentucky ranks near the bottom nationally in oral health, dental Medicaid rates are often 60% or less of commercial rates, and the program’s share of the Medicaid budget has effectively remained around 2% despite growth in enrollment and services. Dr. Robertson said the low rates are contributing to provider losses, rural access gaps, longer wait times, dental deserts, and greater use of emergency rooms for preventable dental problems. He cited examples of office costs exceeding reimbursement for basic procedures, noted that many dentists are small private businesses, and said the state is struggling to recruit and retain dentists because of low payment levels and high student debt. He also pointed to disparities with neighboring states and said recent increases in some oral surgery and cleaning codes were not enough to address the broader problem. His recommendations included completing the rebasing study, increasing dental reimbursement in the upcoming budget, tying future reviews to inflation and cost data, aligning benchmarks, and prioritizing preventive and restorative care to improve workforce stability and access. Board members asked about the size of the needed increase, the effect of private insurance on dental practice finances, and what a new dentist might expect to earn. Dr. Robertson said the association is working on an appropriations request and that private insurance pressures are part of the problem as well, since many plans are HMOs or PPOs with limited provider control over rates. He also said the association can no longer conduct reimbursement surveys because of FTC restrictions, but would try to obtain current ADA data. In response to questions about the future of the program, he warned that without significant changes it could become unsustainable and cited Ohio and Missouri as examples where higher reimbursement improved provider participation and access. The board then heard from Mr. Bowman of Baldwin Consulting, who discussed outpatient behavioral health providers, including ABA therapy and mental health/substance use disorder services. He said these providers face similar issues of rising costs, flat reimbursement, and access problems. He reviewed Kentucky’s network adequacy standards, including travel-time standards, 30-day appointment limits, and newer federal requirements that will require services within 10 business days by 2029. He said wait times for outpatient behavioral health, especially children’s services and ABA, have grown substantially, sometimes to more than a year, and emphasized that the Medicaid department must enforce these standards.

Transcript Highlights:

• There's a kindergarten payment that goes back to the '70s, virtual host school payment.
• The aforementioned kindergarten payment, there's a payment to take the place of...
• There's a Missouri Scholars payment, so when a student accesses a Missouri Scholars payment scholarship
• payments?"
• Yeah, the IT system for that report. Yeah. But...

Committee: House Budget

Summary: The committee first heard the Secretary of State’s FY27 budget presentation. Secretary Denny Hoskins described his office’s work on business filings, elections administration, securities enforcement, archives, libraries, and Safe at Home, and said the office had cleaned up voter rolls by removing more than 200,000 ineligible voters. Members questioned him closely about deceased voters, voter registration through DMVs, information sharing with the federal government, and whether any personal identifying information would be released; Hoskins said only publicly available information had been shared and that PII would not be released absent a court order. He also said his office had 10 pending lawsuits handled by the Attorney General’s office, and discussed budget lapses, staffing levels, and the need to spend federal and other funds before general revenue when possible. A major portion of the discussion focused on election-related funding requests. Hoskins defended funding for ballot publication in newspapers, saying the constitution and state law require publication of statewide ballot measures and that the cost could rise sharply if many petitions or a referendum reach the ballot. Several members questioned whether the newspaper notices are still effective, while others emphasized that many Missourians still rely on print and that the requirement remains constitutional. The committee also discussed the technology services NDI tied to the sunset of the $5 business filing fee that funds IT operations, with Hoskins saying the office would need general revenue if the sunset is not extended. Other topics included absentee ballot postage reimbursement, election cost transfers, and the library networking fund, which Hoskins said has not historically been funded at the full 10 percent level. Members also raised broader budget and policy concerns, including the office’s FTE count, the restoration of some previously cut archives/local records positions, and the need for a new voter registration system and election-night reporting system. Some members pressed Hoskins on whether his budget requests were consistent with his past calls for smaller government, while he responded that election-year obligations, cybersecurity risks, and outdated systems require investment. The committee did not take a vote on the Secretary of State items during this segment. The committee then began the Department of Elementary and Secondary Education presentation from Commissioner Carla Eslinger. She outlined the FY27 request for the foundation formula, transportation, child care, literacy, educator workforce, and strategic planning. Eslinger said the formula increase is driven by policy changes such as enrollment-based funding and higher special education and virtual education costs; transportation needs a modest increase; child care needs general revenue to replace expiring federal funds; and literacy efforts continue to expand through science-of-reading training and state-approved assessments. She also highlighted through-year testing, grade-level descriptors, teacher recruitment and retention, and work with a new Transforming Schools group. The presentation was cut short when the committee recessed for floor activity, with no votes taken.

Transcript Highlights:

• </c> page 10, line 431, there is a payment page 10, line 431, there is a payment modification<00:10:41.440
• . system. system.
• </c> application for a directed payment application for a directed payment program<00:56:24.640><c> that
• </c> direct payment program bill is included. direct payment program bill is included.
• </c> essential that we address that system. essential that we address that system.

Transcript Highlights:

• What we'd argue is that today you have a global payment system that serves thousands of international
• Interchange fees help cover the real cost of secure, reliable electronic payment systems, including fraud
• system.
• Our current system denies families like his access to capital... ...Our current system denies families
• Our current system denies families like his, access to capital, Our current system denies families like

Committee: Joint Joint Committee on Financial Services

Summary: The Joint Committee on Financial Services heard testimony on several bills focused on financial security, banking regulation, and payment-card fees. Treasurer Deborah Goldberg supported the Massachusetts baby bonds proposal (H. 48) and also endorsed bills on matched savings (H. 1158/S. 737) and retirement planning/Secure Choice (H. 1143/S. 722), arguing these measures would help address wealth inequality, build assets, and improve retirement readiness. Supporters of baby bonds included policy experts and health advocates from Children’s Health Watch and Boston Medical Center, who said early-life asset building could improve long-term economic and health outcomes for children in low-income families. AARP also urged passage of the retirement planning bill, citing the large share of private-sector workers without access to an employer retirement plan. Representative Donato testified for H. 1143, describing it as a voluntary retirement-savings opportunity for workers at small employers. The committee also heard testimony on H. 3933, concerning the Massachusetts Credit Union Share Insurance Corporation, from former Bank Commissioner Mike Hanson, who defended the state’s full deposit insurance system for credit unions and savings institutions as a longstanding consumer-protection model. The Massachusetts Bankers Association raised concerns about the bill’s technical provisions and broader credit union/bank competitive issues, while the Cooperative Credit Union Association supported related legislation allowing modest compensation for credit union directors (S. 821/H. 1338) and flexibility for state financial institutions to grow through partnerships (S. 723). Bankers opposed those credit union bills, arguing they would upset a level playing field and blur long-standing distinctions between banks and credit unions. A major portion of the hearing focused on H. 1259/S. 688, which would prohibit card interchange fees on the tax and gratuity portions of restaurant transactions. Restaurant owners and the Massachusetts Restaurant Association testified in favor, saying the fees are a significant and growing expense, especially as most customers now pay by card; they argued the bills would save restaurants money without affecting state revenue. Credit union, banking, and payments-industry representatives opposed the bills, saying interchange helps fund fraud protection and payment infrastructure, that the proposal would create compliance burdens and likely litigation, and that it would mainly affect Massachusetts-chartered institutions while national banks could be preempted. Committee members noted that a commission on payment-card fees is being established and said the issue would be studied further. The hearing also included support for a separate bill on virtual credit cards for dental providers, with dentists saying automatic virtual-card payments impose hidden processing fees and fraud risks.

Transcript Highlights:

• payments by 10 percentage points beginning in 2028 until the state-directed payments are no greater
• payments by 10 percentage points beginning in 2028 until the state-directed payments are no greater
• for administrative payment errors.
• On the provider payment side, it ratchets down payments until they hit Medicare levels.
• So that's a tremendous risk for the system and for action.

Summary: The joint informational hearing focused on the impacts of H.R. 1 on California’s Medi-Cal program and on community health effects from recent immigration enforcement actions. Committee leaders said H.R. 1 would sharply reduce federal funding, increase administrative burdens, and worsen access to care, especially for Medi-Cal enrollees, immigrant families, rural communities, and reproductive health patients. The second half of the hearing examined how ICE raids and related federal actions are creating fear, reducing clinic and emergency department use, and disrupting children’s access to schools and early childhood education. Department of Health Care Services Director Michelle Bass outlined the main H.R. 1 provisions affecting Medi-Cal: work requirements, semiannual eligibility redeterminations, shorter retroactive coverage, new cost-sharing, limits on provider taxes and state-directed payments, reduced federal support for emergency and lawful immigrant coverage, and a one-year ban on Medicaid funding for prohibited abortion providers. She estimated millions could lose coverage, with tens of billions of dollars in federal funding at risk. Planned Parenthood Affiliates of California warned the defunding provision could force clinic closures, service reductions, and loss of access to family planning, STI testing, and cancer screenings. The California Hospital Association said the financing changes could cut hospital revenue by tens of billions over 10 years and threaten access, especially for rural and safety-net hospitals. The Western Center on Law and Poverty argued the law would increase churn, paperwork, and uninsured rates, disproportionately harming working adults and people experiencing homelessness. Committee members asked about implementation timelines, notification systems, administrative costs, the effect on immigrant eligibility, and whether California could delay or mitigate some provisions. Bass said the state was still assessing federal guidance, planning county and provider outreach, and exploring a possible delay for work requirements and a transition period for provider-tax changes. Members also discussed how state budget actions may need to be revisited in light of H.R. 1, and how California might preserve access through state-only funding or other policy changes. In the second panel, CHIRLA, Los Angeles County Department of Health Services, and the Children’s Partnership described the health consequences of immigration enforcement. Speakers said raids and data-sharing fears are causing anxiety, trauma, and avoidance of care, with Los Angeles County reporting declines in emergency, urgent care, and clinic visits after enforcement actions. The Children’s Partnership said school and early childhood absences are rising in some communities and that enforcement is undermining children’s emotional well-being and access to education. Members asked for more data and discussed possible state protections, telehealth, mobile care, and legal and policy responses to reduce fear and preserve access to health and education services.

Transcript Highlights:

• , just looking at all the systems?
• UT System is unique in that they not only have an auditor at the system level, but at each component
• The other issue is I think there's a difference between some of the systems, like UT system, A&M system
• You all have heard the Medicaid system described as a pay and chase system.
• improper payments.

Summary: The Senate Finance Committee met to hear interim charges on higher education transparency and on preventing fraud, waste, and abuse in state government. The chair emphasized accountability for taxpayer dollars and asked witnesses to address financial reporting, audit practices, and whether more frequent or comprehensive audits would improve oversight. Legislative Budget Board staff described how public university systems and most community colleges respond to requests about internal audit practices, noting that university systems generally follow a similar annual audit timeline and that community colleges use a more varied mix of internal and external audit arrangements. Members focused on gaps in reporting, especially Texas Southern University’s missing submissions for several years and Collin County Community College’s nonresponse to the LBB survey. The State Auditor’s Office then outlined its higher education audit work, including mandatory statewide single audits, DEI compliance audits, HUB and State Use Program audits, benefits proportional audits, and discretionary audits based on risk. The auditor said the office has released 43 higher-ed audit reports since fiscal year 2021 and has two audits in progress, and explained that internal audit reports from institutions help guide future audit selection. Senators pressed the office on the lack of enforcement authority, the value of internal auditors at each institution, and whether community colleges should have more standardized reporting and audit requirements. The auditor and general counsel said the SAO can refer suspected fraud to law enforcement but cannot itself enforce findings, while several senators suggested stronger clawback authority and more robust internal audit structures. The Texas Higher Education Coordinating Board explained that it collects annual financial reports, sources-and-uses data, and community college finance reports, and uses them for funding formulas and other reporting. It also trains governing board members and said it has limited regulatory authority, though community colleges must certify compliance annually and can lose eligibility for state funds if they do not. Members questioned the reliability of self-attested data, the adequacy of board training, and whether a single reporting structure would be more efficient. During public testimony, a ScholarShot representative argued for clearer, student-facing financial transparency so students can see total cost of attendance and the gap they must cover before enrolling.

Transcript Highlights:

• Post-COVID sentencing has changed our system. Post-COVID sentencing has changed our system.
• , from the state court system.
• , into the judicial system.
• And so I've, so we came up with the payment plan then to maybe allow people to make payments through
• We started the payment plans.

Committee: Senate Appropriations Committee on Criminal and Civil Justice

Summary: The Appropriations Committee on Criminal and Civil Justice heard an update from Department of Corrections Secretary Ricky Dixon on staffing, overtime, capital needs, and inmate population growth. Dixon said the prison population has risen by about 8,000 since January 2021 while staffing has not kept pace, forcing the agency to open 53 housing units without funded positions and rely heavily on overtime and National Guard support. He cited a $189 million deficit tied to salaries and overtime, noted that most staff have less than three years of experience, and argued the solution is to fully fund posts for operational housing units. He also reviewed the department’s fixed capital outlay projects, including repairs, new housing construction, and medical modular units intended to reduce outside hospital transports, and gave an update on the VINE victim notification system and its expansion. The committee then heard from Florida clerks of court representatives Jason Welty and Miami-Dade Clerk Juan Fernandez-Barquin, who described clerks’ court-related and county duties and said clerk budgets have not kept pace with the broader justice system. They requested reimbursements for injunctions for protection ($3.3 million), Baker Act/Marchman Act/sexually violent predator cases ($2.5 million), and juror management ($4.8 million), and said future funding for new judges should include the full courtroom system, not judges alone. Fernandez-Barquin also raised concerns about unfunded mandates, rising retirement and health costs, low court-side pay, and the need to revisit filing fees and trust fund allocations. Members asked about collections, payment plans, license suspensions, and whether some fees or trust fund distributions could be redirected; the governor’s budget had already picked up the $2.5 million request for Baker/Marchman/SVP cases. During public testimony, speakers urged broader criminal justice reforms and additional funding priorities. A prosecutor emphasized that adding judges requires funding for prosecutors, public defenders, and clerks as well. Other speakers called for parole or long-term sentencing reform to reduce prison populations and costs, criticized staffing and conditions in prisons, and raised concerns about inexperienced correctional officers, visitation delays, and lack of air conditioning in some facilities. The committee took no substantive votes on the items discussed and adjourned after hearing the presentations and public comments.

Transcript Highlights:

• for the payment system, and that makes us very reliant on some of the federal rules, this is more about
• Rollout of our new automation system, the CWS CARES system, later this year going live, and that will
• The production simulation allows users to test with legacy system converted data, test system interfaces
• how the system reacts.
• I also have 13 years of lived experience within the child welfare system and intersecting systems.

Transcript Highlights:

• Altman said, out of the bundled payment and have it separate.
• cap and subcap payment.
• We also have problems with payments from some of these MCOs.
• This model addresses systemic problems in the mental health system and service delivery systems by...
• ...problems in the mental health system and service delivery systems by integrating behavioral services

Committee: Joint Joint Committee on Mental Health, Substance Use and Recovery

Summary: The Joint Committee on Mental Health, Substance Use and Recovery held a public hearing on 14 bills focused on insurance, parity, opioids, behavioral health access, and mental health system reform. Chair Mindy Domb and Vice Chair Robyn Kennedy outlined hearing procedures and noted the committee would accept written testimony. The hearing featured testimony from legislators, providers, advocates, and behavioral health organizations, with most speakers urging favorable reports on the bills they addressed. A major topic was psychiatric collaborative care, including H. 222/S. 1390, which would raise reimbursement for collaborative care codes to at least Medicare levels and allow billing outside the MassHealth primary care subcapitation model. Supporters said the model improves access, outcomes, and cost savings by embedding behavioral health in primary care, and several witnesses described successful implementation in practices and schools. Committee members asked questions about how the model works, what specialties use it, barriers to adoption, and whether copays, deductibles, and subcapitation rules should be changed. Witnesses also supported related innovation legislation, including H. 2224, which would create a mental health innovation fund and support nontraditional trauma-healing approaches. Other bills discussed included H. 2212, which would require prescribers to discuss opioid and pain-medication risks, alternatives, and addiction/overdose concerns with patients or guardians; H. 2232 and H. 2233, which would address equitable payment and equitable access for behavioral health providers serving MassHealth patients; and S. 1406, which would add opioid maintenance treatment information to MassPAT and allow patient-authorized access to that information. Witnesses also strongly backed S. 1399, which would set targets to increase behavioral health spending within the overall health care cost benchmark, arguing that Massachusetts underinvests in behavioral health and that greater investment could reduce emergency, hospitalization, homelessness, and criminal justice costs. No votes were taken; the hearing concluded after testimony and committee questions.

Transcript Highlights:

• system.
• </c> approved within our Medicaid payment approved within our Medicaid payment system<00:31:36.480><c
• , including it repeals an annual alternative payment system, proper rate inflation, phases out closure
• <c> payment</c><00:37:56.640><c> system</c><00:37:57.079><c> proper</c><00:37:57.680><c> rate</c> alternative
• payment system proper rate alternative payment system proper rate inflation<00:37:58.960><c> uh</c><

Committee: House Human Services Finance and Policy

Transcript Highlights:

• We talk about the voucher system.
• DES authorizes child care providers to directly input payment information into its benefit system, and
• then DES approves those payments.
• the electronic system.
• How would the new system... Correct.

Committee: Joint Joint Legislative Audit Committee

Summary: The committee first heard an update on Topok Elementary School District’s long-running noncompliance with Arizona’s Uniform System of Financial Records. The Auditor General’s office explained the USFR noncompliance process and reported that Topok had made substantial progress, correcting many deficiencies in areas such as open meeting law, procurement, payroll, attendance reporting, property control, and information technology. The district’s superintendent and staff described the corrective actions they had taken, the use of outside consultants, and their plan to maintain compliance through stronger leadership, training, and consistent procedures. Members praised the district’s progress and asked about the remaining deficiencies and the status of the 3% state-aid withholding, which the Auditor General said would be addressed by the State Board of Education. The committee then considered a request for a fourth school safety special audit, tied to concerns raised by Representative Martinez about Phoenix Union High School District and school violence response practices. The Auditor General said the proposed audit would be a new topic focused on policies and procedures for responding to credible threats of violence and allegations of staff misconduct affecting student safety, and could include Phoenix Union in the sample. Representative Martinez described a fatal 2024 shooting, weapons incidents, and concerns about district oversight. The committee approved the motion 10-0. Next, staff presented the fiscal years 2027-2028 school district performance audit schedule, describing 26 randomly selected school districts and career and technical education districts, plus 84 planned follow-ups. The Auditor General said the schedule is intended to shorten the average time between audits and that the school audits division is now fully staffed. Members asked about county coverage and the inclusion of ESA accountability, but the schedule was ultimately presented for review rather than approval. The committee also heard a detailed federal compliance audit presentation on the Child Care and Development Fund (CCDF) administered by DES. The Auditor General reported repeated findings involving missing provider documentation, questioned costs, and FFATA reporting errors, including a 2024 sample that led to questioning $2.88 million in costs. The office recommended stronger documentation, record retention, reporting procedures, and staff training; DES concurred and said it would correct the findings in 2026. Members discussed the limits of the single-audit scope, the possibility of a broader special audit, and the federal government’s recent actions on CCDF oversight in other states. Finally, the committee considered and discussed a special audit request for CCDF that would broaden review to provider oversight, licensing, site visits, and billing accuracy across multiple state agencies, with estimated costs of $547,000 to $625,000 and a projected report date of July 31, 2027.

Transcript Highlights:

• </c><00:02:55.960><c> controls,</c> before they are paid, payment controls, before they are paid, payment
• </c> analytics after payments are made. analytics after payments are made.
• </c> post-payment analysis. post-payment analysis.
• <00:41:56.000><c> withholding</c><00:41:56.400><c> language</c> payment withholding language payment
• </c><01:36:05.320><c> Schools</c> cost reimbursement system. Schools cost reimbursement system.

Committee: House Fraud Prevention and State Agency Oversight Policy

Transcript Highlights:

• </c> operate separate from the court system operate separate from the court system itself.<00:10:32.240
• </c> contract for a claims management system contract for a claims management system that<00:10:44.320
• , starting effective July 1, 2025, that the payments paid to the attorneys will match the same payment
• </c> system. Thank you. Thank you, Mr. system. Thank you. Thank you, Mr.
• </c> we get information out of that system. we get information out of that system.

Committee: Senate Finance

Transcript Highlights:

• </c> do is it has the state funding payments do is it has the state funding payments oh<00:29:04.760>
• So there are payments that are scholarship payments that are not taxable under federal law.
• So there are payments that are scholarship payments that are not taxable under federal law.
• There would be a one-time cost of $300,000 for Dr. to implement the electronic filing and payment system
• </c><03:14:19.359><c> system</c> electronic filing and payment system electronic filing and payment system

Summary: The committee opened a public hearing on HB 402, a bill dealing with whether Education Freedom Account (EFA) payments should be described in state law as not constituting taxable income. The bill sponsor argued that the current statute is misleading because New Hampshire should not imply a federal tax result, and said the bill would remove that language and could also be amended to clarify that families should consult tax advisors. He emphasized that the measure was not intended to impose a state tax on EFAs, but to avoid giving inaccurate advice about possible federal tax liability. Testimony was divided. A retired representative and a tax preparer both opposed the bill, saying EFA payments are already treated consistently with IRS rules and that the bill would create confusion, administrative burden, and possible tax consequences for low- and moderate-income families. They argued the bill is a solution in search of a problem and warned that requiring 1099s could add costs for the scholarship organization and recipients. A tax attorney supported the bill’s repeal of the state language, saying New Hampshire should not put tax advice into statute and that the current wording is inaccurate because federal law, not state law, controls taxability. He cited IRS Section 117 and Publication 970, explaining that only some scholarship-like payments are tax-free and that many EFA-eligible expenses may not qualify for federal exemption. Members asked questions about what would be misleading, whether the bill was trying to tax EFAs, and the cost of issuing 1099s. The sponsor and witnesses repeatedly said the bill was not a state tax on voucher payments, but a clarification about federal tax treatment. No vote or final committee action was taken in the portion provided.

Transcript Highlights:

• That's why moving to a direct payment system makes so much sense.
• </c><00:05:28.080><c> Not</c> payment system makes so much sense.
• Not payment system makes so much sense.
• Over the next year and a half, it would replace Minnesota's delivery and payment system for these two
• model</c> sick care payment system toward a model sick care payment system toward a model of<00:29:21.600

Committee: Senate Health and Human Services

Transcript Highlights:

• Well, theoretically, the error rate would capture fraudulently made payments as well.
• So this doesn't mean that the payments are permanently made in error.
• determine what that payment appropriately should be.
• How the feds determine what that payment appropriately should be.
• We have the system to provide support for people who lose their jobs.

Committee: Senate Senate Committee on Intergovernmental Affairs

Summary: The committee heard testimony from Doug Howe of the Mass Taxpayers Foundation and Evan Horowitz of Tufts on the fiscal effects of federal policy changes, especially the OB3 reconciliation law, federal shutdown risks, and Massachusetts budget planning. Howe outlined a framework of direct and indirect federal impacts on the state budget, capital program, and grant funding, emphasizing uncertainty around Medicaid, SNAP, LIHEAP, immigration, NIH funding, and federal tax changes. He said OB3 is expected to reduce federal health spending in Massachusetts by about $3 billion annually when fully implemented, with an estimated 250,000 to 300,000 people losing coverage, and could shift up to $400 million in annual SNAP costs to the state if Massachusetts’ error rate remains above the federal threshold. He also discussed the governor’s proposal to delay conformity with certain federal tax changes and to expand the pass-through entity tax to offset revenue losses. Members questioned the witnesses about SNAP error rates, unemployment insurance, the use of the stabilization fund, and whether the state should adopt a Maryland-style delay in implementing federal tax changes. Howe argued the stabilization fund should not be used to backfill permanent obligations, but could be used for temporary crises, and said the state should improve data-sharing and administrative systems so eligible residents do not lose MassHealth or other benefits because of paperwork barriers. He also said unemployment insurance remains a major problem and that a broader fix should include benefit, tax, and possibly state contributions. Horowitz took a more aggressive view on using reserves for urgent needs like SNAP, argued the state should harden its budget against volatility, and warned that Massachusetts is increasingly exposed to stock-market-driven revenue swings and to a possible income tax ballot question that could significantly reduce revenues. No votes were taken; the hearing was informational, and the chair asked both witnesses for follow-up written recommendations, especially on system integration and accountability.