A Step Forward, But Not Far Enough: Analysis of FY26 Senate Budget Proposal

On May 6th, the Senate released its recommendations for the FY26 budget, following last week’s supplemental budget proposal outlining the allocation of excess Surtax (Fair Share) revenues. We're taking an early look at how these proposals compare to those from the Governor, the House, and last year’s enacted budget—focusing on the areas most aligned with our mission and expertise: higher education, student financial aid, institutional funding, and capital investments.

The Senate proposal advances key higher education priorities but falls short in critical areas—most notably in its limited allocation of Fair Share revenue. With just 12% of Fair Share funds ($234 million) directed to higher education, which is well below the minimum 25% recommended by the Board of Higher education, Massachusetts risks stalling its recent gains in progress in establishing an accessible, affordable, high quality public higher education system.

Falling Behind: Higher Ed’s Share of Fair Share Funds Drops Over Time

1. Senate Support for Student Financial Aid Shows Promise, but Gaps in Community College Access Persist
Starting on a positive note, the Senate proposes a 25% increase in the MassGrant Plus Expansion program funding, from $80 million to $100 million. This timely boost begins to address the persistent shortfall in meeting student demand seen in prior years.

The Senate’s proposal for the Free Community College program, however, increases funding by only 2%—from $117.5 million to $120 million. This modest growth fails to keep pace with inflation and falls short of what’s needed given rapidly rising enrollment: a 14% increase in the past year and 24% since 2023. Without sustained and expanded investment, the state risks falling short on its promise of tuition-free community college and associated stipends for Pell-eligible students.

Interestingly, the Senate decided to fold MassReconnect (1596-2418) (the tuition-free grant for 25 years old and over) under the Free Community College Program For All (1596-2501) specifying that the program can continue to be referred to as is. Considering that both programs provide the same financial aid, it does make sense to consolidate them in the backend to streamline the system, which we believe should be a core priority.

Still, the state’s main scholarship line item (7070-0065)—which funds core need-based programs like MassGrant, MassGrant Plus, the Gilbert Grant, and several smaller targeted initiatives—remains essentially flat-funded, with just a 1% increase since FY23. This failure to keep pace with inflation places additional strain on last-dollar programs such as MassGrant Plus, MassReconnect, and MassEducate, which are increasingly expected to fill widening gaps between tuition costs and stagnant base aid.

2. Senate Increases Institutional Funding, But Reductions to Targeted Programs Raise Concerns
The Senate aligns with the Governor’s budget in proposing strong direct support for public higher education institutions. The percentage increases shown below reflect changes relative to the FY2025 allocations:

• University of Massachusetts: A 10.4% increase, bringing total funding to $848 million. While the Senate does not earmark a specific $10 million allocation for new SUCCESS programming at UMass campuses—as proposed in the House budget—it does include an overall $10 million boost to UMass operations. This approach delivers a comparable total investment, though without the same programmatic specificity.

• A 9.1% increase for state universities, totaling $400 million.

• A 7.3% increase for community colleges, totaling $409.4 million.

Yet, while core institutional funding rises, many smaller higher education-related line items are reduced or flat-funded. These programs, including supports for mental health, foster youth, and innovation, play a vital role in promoting equity and access. Cuts to such initiatives risk undermining the state’s broader goals for inclusive postsecondary success and should be revisited during final budget negotiations.

One bright spot is a $1.2 million increase for the SUCCESS initiative at community colleges, which supports persistence and completion at those institutions. However, current funding levels still limit its reach to fewer than 8% of enrolled students. These programs are critical to converting financial access into degree attainment and should be funded and scaled accordingly.

3. Senate Proposes Higher Education Capital Investments in Supplemental Budget—but Still Falls Short
The Senate budget does not include the Governor’s proposed $125 million in Fair Share-funded higher education capital projects. However, it is important to note that the Senate released its supplemental budget last week —which allocates the $1.2 billion in excess Fair Share revenue— and included $175 million for public higher education capital needs.This is a meaningful investment that acknowledges the sector’s long-standing infrastructure challenges.

Conclusion

The Senate’s FY26 budget proposal makes progress on access to public higher education, notably through increased MassGrant Plus and institutional funding. However, access alone is insufficient. Students also need financial stability and evidence-based support services to complete their programs and transition into meaningful careers.

With only 12% of Fair Share revenue allocated to higher education—well below the 25% recommended by the Board of Higher Education—the current investment level may not meet growing demand or address persistent equity gaps.

To truly deliver on the promise of equitable higher education, the Senate must go further. That means strengthening financial aid across the board, scaling up programs like SUCCESS to reach more students, and investing in evidence-based support services that address students’ basic and holistic needs—from academic advising and mental health support to career preparation.

A more balanced allocation of Fair Share funds would help sustain recent gains and support a more effective and equitable higher education system.