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Closeout budget just one more piece of unfinished business

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BOSTON (SHNS) – It’s a rather obscure annual function of state government that, were things to go smoothly, would attract minimal attention or interest. But closing out the just-ended budget year has not gone smoothly recently in Massachusetts, and the COVID-19 pandemic threatens to further complicate the process this year.

The state comptroller must finalize the books on the fiscal year that ends each June 30 and file the state’s annual Statutory Basis Financial Report by each Oct. 31. Before the comptroller can prepare the SBFR, though, the Legislature must pass a so-called closeout supplemental budget and the governor must sign it into law.

But lawmakers in recent years have opted to wait longer and longer to pass that bill, taking it up in October or even November, rather than August or September as they used to do in the late 1990s and early 2000s.

“During recent years, the SBFR has not hit that target date” of Oct. 31, Comptroller William McNamara said Wednesday during a meeting of the Comptroller Advisory Board. “In 2017, it was issued on November 17 and 2018 it was issued on November 8, so that was slightly more than a week beyond its due date. But then last year, the 2019 report was not issued until very early in the new year of 2020.”

Last year, which saw the lateness of the closeout supp devolve into something of a staring contest between former Comptroller Andrew Maylor and the Legislature, Gov. Charlie Baker got the ball rolling when he filed a closeout supp on Sept. 6, 2019.

This year promises to be a more complicated process. Massachusetts moved the deadlines for personal income tax returns and payments from April 15 to July 15 and deferred some sales, meals and room occupancy tax payments to September as a result of the COVID-19 pandemic, and the Department of Revenue was still collecting millions of dollars of revenue for fiscal year 2020 — which ended June 30 — into August.

The business shutdowns forced by the pandemic punched a wide hole in the state’s revenue base and officials have yet to say whether the revenue drop was so severe that they will need to dip into the state’s $3.5 billion reserve account to cover spending that occurred in the fiscal year that ended June 30.

“We are in discussions about the final supp and the budgets with the Ways and Means committees constantly. So I think as we roll out into September, we’re aware of the dates but with the delay in a number of tax types from April, this has become an incredibly complex close,” Michael Heffernan, the Baker administration’s secretary for administration and finance, said Wednesday. “But we are working very diligently to get a supp filed, so not a lot of vacation days for the poor budget staff.”

McNamara, who joined the Baker administration in 2016 and was working as an assistant secretary under Heffernan when Baker tapped him to replace Maylor in February, said his office is hopeful that Heffernan’s team and the Legislature “will be putting a focus on this.”

“Not to put too fine a point on it, there would have to be very prompt action, at least begun, to put the SBFR on track for delivery near its due date,” he said Wednesday. He added, “Obviously, our very urgent hope is that action will take place so that we can deliver the SBFR on a reasonably prompt basis. Speaking very frankly, if we could match 2018 and 2019 that might not be ideal, but certainly that would be something that we would like to do. Our goal would be to hit 10/31 but we certainly are hoping to get it out; if not, then as soon thereafter.”

The struggle to meet the Oct. 31 filing deadline for the SBFR is not unique to McNamara or Maylor, who last year said he “made it clear to the Legislature that we’re not going to do this next year.” Former Comptroller Thomas Shack, who resigned amid a donnybrook with the Baker administration over the design and implementation of computer systems that affect all state agencies, often said the Legislature needed to enact a closeout supp by the end of August in order for the comptroller’s office to meet its deadline.

Last year, Maylor tangled with the Legislature over its failure to close the books on fiscal year 2019 in a timely manner. After the inaction forced him to miss the Oct. 31 financial reporting deadline, Maylor threatened to unilaterally transfer the full amount of the state’s surplus to the Stabilization Fund and leave accounts in deficit if lawmakers didn’t act.

Maylor ultimately backed off his threat and the Legislature took negotiations over a bill to reconcile the loose ends on the budget from the prior year later into the year than any time since at least 1995, forfeiting more than $1 million in interest that the state could have earned had lawmakers completed their work on time.

Treasurer Deborah Goldberg has also previously chimed in on the risks of being late to close the state’s books, pointing to “not a real strict adherence to the deadlines” and saying the pattern of consistently late closeouts is “sort of like kids getting away with stuff for too long.”

The closeout supplemental budget might have some company as it knocks around the House and Senate Ways and Means committees this fall. Not only must lawmakers dot their Is and cross their Ts on the FY20 budget, but they also have to craft an annual budget for the fiscal year that began July 1. A $16.53 billion interim budget will keep state government operating through at least the end of October, but no clear plan for budgeting beyond that has come to light on Beacon Hill.

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Business owner says sign is not racist

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“It’s kind of sad that people go to these extents to read into stuff and twist and turn a question. [It’s] not a racist question. I am not a racist,” Mike told WTRF, adding that he has Black customers and deliverymen. “The racist stuff is just somebody twisting and turning, and it’s ridiculous. Everything right now is very high tension, and this might be some of it, some way that people try to let the steam go.”

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SpaceX is rapidly growing its Internet satellite business

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With an eventual public offering in mind, SpaceX is ramping up its Starlink Internet service, as it’s slated to launch another 60 satellites on Wednesday.

The launch, according to a list from the Federal Aviation Administration, is slated to happen from Cape Canaveral, Fla. It will take place at 12:36 p.m. EDT on the company’s Falcon 9 rocket, according to SpaceflightNow.com.

On Sunday, SpaceX launched another group of 60 satellites, which the Hawthorne, Calif.-based company said will provide “high-speed broadband Internet to locations where access has been unreliable, expensive or completely unavailable.”

MUSK’S SPACEX WINS PENTAGON AWARD FOR MISSING-TRACKING SATELLITES

More than 700 satellites have been launched, according to CNet, which also notes that 60 of the older satellites are in the process of deorbiting

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SpaceX continues to bolster its service ahead of its public launch, scheduled for later this year. On Monday, SpaceX teamed with Microsoft to use its Azure cloud computing service to help connect and deploy new services for its Starlink unit.

The Musk-led company has said it is targeting service in the northern part of the U.S. and Canada this year, but has not given an exact time frame yet.

In the past, SpaceX CEO Elon Musk has said that the company will “probably” take its Starlink Internet business public, but only when it has “predictable” and “smooth” revenue growth.

MICROSOFT TEAMS WITH ELON MUSK’S SPACEX TO PUSH CLOUD BATTLE WITH AMAZON INTO ORBIT

In October 2019, Musk sent a tweet using the Starlink satellite system.

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In April, Musk said there were 420 Starlink satellites in space.

In July, Morgan Stanley said SpaceX could be worth as much as $175 billion if Musk’s Starlink Internet service is successful.

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Kilani Bakery in business 61 years turns to social media to bring in customers

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WAHIAWA, (KHON2) — To survive the pandemic, small businesses have had to adapt to the ever-changing COVID-19 guidelines. Many long-time local businesses have also had to find new creative ways to bring in customers amid the pandemic.

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One of those businesses is Kilani Bakery, a Wahiawa gem that has been serving the community for 61 years.

The bakery is old school. It first opened in 1959 on Kilani Avenue in Wahiawa.

“We literally have the best customers, and it’s because of them that we keep going,” said Dawn Takara, the manager of the bakery.

Sidney Takara’s father started the tiny, humble bakery.

“I worked in the bakery washing dishes, doing little things I picked up here and there,” said Sidney Takara about his childhood.

Eventually, the bakery expanded to its current location at 704 Kilani Ave., and Sidney Takara and his brother Jeffrey took over the business.

Dawn Takara said the bakery is hard work.

“My husband and my son, they start at about six in the evening and then they go from there, and then another baker comes in about one o’clock [in the morning],” she explained.

Sidney Takara said working through the night is worth it for his community.

“I meet people at the bank like on a weekend, the teller and is there and says, ‘Oh yeah, I used to go there after high school,’” Sidney Takara said.

Kilani Bakery is known for its irresistible brownies that often sell out.

“It’s a little chewy. We have nuts in it,” Dawn Takara explained about the brownies. “[Customers] call it crack brownies,” she said.

However, the pandemic has been a difficult time for many businesses.

Sales at the bakery are down, so Kilani Bakery has come up with new ways to get customers.

“We’re very old school. We don’t like social media, but we’ve turned to social media to put ourselves out there and to do some advertising,” Dawn Takara explained.

On top of COVID-19, it doesn’t help that there is construction daily along Kilani Avenue.

The Takara’s said the construction deters many customers from going to the bakery.

However, for those who do want to support the long-time local business, there is plenty of parking available.

Because of COVID-19, the Takara’s said it is no longer about making money. It is simply about surviving for their customers.

“They follow us to the end,” Dawn Takara said about their loyal customers. “They threaten us if we ever even think of shutting down,” she said.

Dawn Takara said they also hope to stay in business for years to come, so their kids can one day take over.

“I always tell my kids, you have to love what you do,” Dawn Takara stated.

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