Increasing Local Aid for Cape Cod

Local Aid and Lottery Distributions (see explanation below video):

Lottery Distributions, An Explanation:

It is indisputable that the lottery distribution formula is inequitable to Cape communities. The simple explanation of the formula is that the adjusted value of real estate in the community is divided by the population of the community. The product of that exercise is compared to the adjusted value of the commonwealth divided by the population of the commonwealth to determine what the community gets via distributions. There is no consideration of community income or the fact that, when there are a significant number of second homes, the value/population approach is skewed. Because of that lack of consideration, Cape communities and communities in the Berkshires suffer from the built in inequity.

The inequity can be resolved by a simple adjustment to the formula that would provide communities that generate significant amounts in Lottery revenues with a minimum of ten percent of what the town generates in revenues.  That adjustment would affect 32 communities and only cost ten million five hundred thousand dollars to remedy.

There is an unwritten rule in the legislature that no such adjustment can be made in a distribution formula (including the education funding distribution) unless all towns are held harmless.  That is, no town should lose money. The rule means that no change can be made to correct an inequity until enough money is added to the funding issue to ensure that no town loses money.

I saw an opportunity in the casino legislation that would have allowed an adjustment to lottery distributions while ensuring that no town would get less money than they get now and, in fact, every town would see an increase in revenues.

The casino legislation proposed to create a “Gaming Local Aid Fund”. That fund would receive certain revenues from casino and slot machine revenues. House leadership and proponents of the casino legislation estimate the fund would realize $100 million per year in new aid to cities and towns. That fund would be distributed yearly pursuant to and along with the annual Lottery distribution.

Currently 32 communities generate one third of the total annual Lottery revenues. Fifteen of those communities are on the Cape and the Islands. Yarmouth and Dennis are among those communities. If $10.5 million of the $100 million anticipated revenues from gaming were used to adjust the formula then there would still be $89.5 million additional aid money to distribute among all cities and towns. By curing the inequity using additional, “new” money, every community in the commonwealth would gain local aid. Unfortunately, House leadership chose to fight that proposal and opted to place the proposal in a study.