Oct. 20, 2026…..Knowing he would spend part of his day defending his House Ways and Means Committee’s rejection of a gas tax suspension, Chairman Aaron Michlewitz made a point Tuesday morning to check the price at the only gas station in his downtown Boston district — $5.47 a gallon, he said.
That Mobil station on East Berkeley Street, hard against Interstate 93 and one of the few fuel stops for desperate drivers leaving downtown via the expressway, regularly sells gas at a higher price than the statewide average (about $4.28 per gallon, per AAA) or other stations. Michlewitz said the station generally charges “$1 to $1.50 more than anywhere else in the city.”
“Even if the gas tax holiday was to take effect, I don’t see the mechanics of preventing wholesalers or distributors from raising the rate to offset that 24 cents. You know, I don’t see that mechanics in place or something that could be effectively put in place,” the chairman said. The North End Democrat added, “I think many of us have real skepticism on this being real, an opportunity for real savings with our constituents that are desperately in need in the middle of this affordability crisis that we’re in.”
Michlewitz and the other Democrats on the House Ways and Means Committee advanced Tuesday morning a $2.35 billion spending bill for a vote of the House expected Wednesday. The vote was 24-0 and the committee’s Republicans all chose not to take a for or against position. The committee said its version would have a net state cost of about $1.5 billion, and the bill is intended to close the state’s books on the fiscal year that ended June 30.
The committee’s redraft (H 5699) does not feature Gov. Maura Healey’s proposal to temporarily waive collection of the 24-cent-per-gallon state levy on gasoline and diesel sales as war in Iran has kept pump prices elevated for months. Michlewitz noted that the House has rejected similar ideas in the past and raised concerns that forgoing gas tax revenue could mean less money going toward transportation infrastructure projects and the MBTA.
The gas tax suspension idea, a form of which was being touted by both Healey and Republican gubernatorial nominee Mike Minogue, is “what I would call a gimmick, short-term kind of conversation … that may not have any real savings at the end of the day,” Michlewitz said, adding, “the numbers just don’t add up for this proposal to be something that we feel we should be supporting.”
“I think the real relief will come when the president of the United States ends this meaningless war that we’re having with Iran, that is really the real culprit here in rising fuel prices,” Michlewitz said. “And I think we need to continue to put pressure — I think we need to get out and vote … I think we need to continue to put pressure on the fact that we need to flip Congress and hopefully find a way to end this war. So then our constituents can actually see the real relief at the gas pump.”
In September, when she rolled out her gas tax relief plan, Healey said her team had taken the time to craft a proposal that would ensure drivers feel relief when filling their vehicles and to ensure no negative impacts on transportation funding and state bond obligations. She said surplus tax revenue collected from wealthier households would pay for it.
“This will not cause us any fiscal harm and it also will not jeopardize any funding that is going towards transportation or important infrastructure projects,” she said at the time. “I wanted to make sure that what we file guarantees that our drivers are going to see the price reduction, they’re going to see the benefit of this, and that’s why we wrote this the way we did.”
The Massachusetts Fiscal Alliance criticized the committee’s elimination of Healey’s two-month gas tax suspension, an idea estimated to save drivers a collective $120 million.
“There are ideas on the table to give taxpayers a break, but legislative leaders don’t seem interested in any of them. Massachusetts families are being squeezed from every direction, and Beacon Hill’s response is to keep collecting every penny it can from them at the pump,” Executive Director Paul Craney said. “This was never going to solve Massachusetts’ affordability problem. It was two months and 24 cents a gallon. But when given the choice between providing even a little relief to taxpayers or keeping the money in government, House leaders chose government.”
As of about 3:40 p.m. Tuesday, representatives had filed 128 amendments to alter the House Ways and Means version. None appeared to seek to reintroduce a gas tax holiday.
“As predicted, this was a political stunt, pure and simple. It’s a sad game to play with hard-working Massachusetts families who are looking for meaningful relief,” Minogue said in a statement that reiterated his intention to push for the elimination of the state gas tax if elected governor. He said he would suspend the tax whenever prices hit $4 per gallon or more, but did not say how he would overcome an unwilling Legislature.
The budget the House is poised to pass Wednesday conforms to the governor’s initial filing in many ways: $1.8 billion gross ($1.03 billion net) for MassHealth, $79 million for unemployment insurance interest repayments, $2.25 million for maternal health needs, nearly $6 million for the Cannabis Control Commission to implement this year’s industry and regulator reform law, $18.5 million for an early education rate reserve, a $10 million transfer to the Mass. Life Sciences Center, and a $30 million collective bargaining cost reserve.
The House Ways and Means Committee said its bill also includes $56 million to increase nursing home and rest home rates, $54.5 million to support hiring additional Department of Transitional Assistance caseworkers, and almost $160 million, paid with surtax revenue, for snow and ice removal. It also includes authorization for an assessment against pharmacy benefit managers, at a rate sufficient to pull in at least $1 million a year to cover expenses related to the regulation and oversight of PBMs.
While many of the dollars and cents are similar between the governor’s version and the Ways and Means bill, representatives are not going along with many of Healey’s policy ideas. In addition to erasing her gas tax holiday idea, the House Ways and Means Committee also eliminated Healey’s push to crack down on ticket resellers and her proposed Health Care Stabilization Fund.
Under the governor’s supplemental budget, the fiscal year 2026 surplus and 85% of excess capital gains revenue left after up to $600 million is used to cover any deficits would have flowed into a new reserve account the state could tap if federal cuts or other shocks put pressure on MassHealth, the Massachusetts Health Connector or the Health Safety Net Fund as is widely expected as a result of federal changes.
Michlewitz said he “applaud[s] the governor for bringing this proposal to the table” but thinks it will take “a much more deeper dialog” to get the mechanics of a specialized stabilization fund for healthcare right.
“The feeling was that a closeout supplemental budget is, because of the time constraints that we’re under, was not necessarily the appropriate spot to be doing that,” the chairman said. “I think it’s something we will revisit in the coming year because I think it does, it certainly has some merit in terms of its need.”
Instead, under the House version of the supp, the fiscal 2026 surplus and the same portion of so-called excess capital gains revenue would go into the Transitional Escrow Fund, a roughly five-year-old account that has become a tool for state budget managers to maintain flexibility. One former state budget secretary said the fund “acts almost as a stabilization fund on top of the Stabilization Fund.” The fund was due to sunset in 2027, but the House Ways and Means bill would extend that to 2028.
Michlewitz said stashing the surplus into the Transitional Escrow Fund “still holds the money and still keeps it alive for usage, but also allows us to kind of reassess things maybe coming in the new year.”
The committee’s bill also leaves out roughly $245 million that Healey sought to cover sheriffs’ deficiencies from fiscal 2025 and 2026, an issue that sheriffs and state budget writers have been wrestling with for about a year. Michlewitz said the House is still waiting on information it requested from the sheriffs about those shortfalls. He said the House has made clear that “we weren’t gonna be doing any further deficiency budgeting going forward,” and pointed to higher fiscal 2027 sheriff funding as an effort to stabilize those budgets.
House leadership added its own policy to the supp budget, inserting sections that would ban the distribution of deceptive media about candidates or election operations “with actual malice” within 90 days of an election and require that paid political audio or video ads containing synthetic media say “contains content generated by AI” at both the start and end. The House rewrite also bans state constitutional officers from “knowingly spending or authorizing the use of public funds of the Commonwealth to appear in any advertisement or promotion using the officer’s name, voice, or likeness to establish recognition for the constitutional officer,” according to a committee summary.
“This supplemental budget addresses important time-sensitive deficiencies, provides support for maternal mental health services, limits the use of AI in political advertising, and provides funding for vital programs — including for MassHealth, DTA caseworkers, and for the life sciences sector,” Michlewitz and House Speaker Ronald Mariano said in a joint statement Tuesday morning. “We look forward to continued conversations with our colleagues about these important issues, and to passing this legislation tomorrow.”
Appropriations bills filed after July 31, like the fiscal 2026 closeout supp, are among the four categories of business that the House and Senate can conduct and hold roll call votes on during this phase of the session. The House plans to meet in its first formal session since July 31 on Wednesday, with a vote on the bill expected sometime after 1 p.m.
“I think we are going to learn as we go on what this new process will look like,” Michlewitz said when asked for his forecast for a formal session so close to a statewide election.
The Senate will have to follow suit and could have its own ideas for additions or subtractions. The Senate is not planning a formal session this week. The comptroller cannot file a statutorily required report on state finances until lawmakers and the governor formally close the books on the last fiscal year, which ended June 30. That report is due at the end of October and the comptroller annually complains that the Legislature is habitually slow to act on the closeout budget.
Colin Young is the deputy editor for State House News Service and State Affairs Pro Massachusetts. Reach him at colin.young@statehousenews.com.
