- Associated Press - Saturday, January 21, 2017

BOSTON (AP) - As Gov. Charlie Baker prepares to outline his priorities for the year ahead, the Republican is working to keep his political footing on what could be a rocky path ahead.

There’s plenty to celebrate in Massachusetts.

The state just reported its lowest unemployment rate in 16 years with the jobless rate in December falling to 2.8 percent. The economy is booming in much of the state. And cranes can be spotted over construction sites from Boston to Springfield.

There are also more than a few potential bumps in Baker’s path as he puts the finishing touches on his State of the Commonwealth address. Baker will deliver the address to lawmakers and a statewide TV audience Tuesday evening.

One big question facing the state, and the nation, is the future of former President Barack Obama’s health care law.

President Donald Trump and Republicans in Congress have vowed to repeal and replace the federal law, although it’s unclear what form that replacement will take.

A 2006 state law signed by former Republican Gov. Mitt Romney provided the blueprint for the federal law. Baker sent a letter to House Majority Leader Kevin McCarthy, R-California, urging his fellow Republicans to keep key parts of the federal law, including letting Massachusetts keep its mandate that all residents have health insurance.

Depending on what changes are made to the law in Washington, Baker - a former health care executive - could have his hands full adjusting the state law to compensate.

Another challenge is the Massachusetts budget.

Despite the state’s robust economic picture, keeping the state budget balanced remains a challenge.

Last month, Baker cut nearly $100 million to close a nagging shortfall in the nearly $40 billion budget, drawing criticism from top legislative Democrats who said they may consider overriding some of the cuts

Baker’s address also comes just one day before the governor is scheduled to submit his annual state budget proposal to lawmakers.

Still another challenge is the state’s new marijuana legalization law.

Baker and lawmakers will be given the task of overseeing the implementation of the law which voters approved over the objections of officials like Baker and Democratic Attorney General Maura Healey.

Baker has already signed a six-month delay of several key provisions in the law, angering supporters of the law.

Still other changes could be on the horizon including proposals to increase the law’s 3.75 percent excise tax that will be applied to retail marijuana sales when pot shops open, likely in 2018.

During his two years in office, Baker has enjoyed strong popularity, in part by forging ties with Democratic lawmakers where he can and by presenting himself as pragmatist looking to solve problems, from balancing the budget to grappling with the state’s opioid addiction crisis.

Baker is widely expected to seek re-election in 2018, though he has yet to make any formal announcement.

Democratic activists are hoping the new year provides them with new ways to chip away at Baker’s popularity, in part by trying to tie him to Trump.

That could be tricky, given Baker rejected Trump during the campaign and said he didn’t vote for him. That hasn’t stopped Democrats for faulting Baker for taking a “wait and see” attitude toward the new administration.

While names of some potential Democratic challenges have surfaced, including Newton Mayor Setti Warren, none have declared their candidacy.

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