Did some invitations get blown off the porch, Trav?
That's the only conclusion we could reach after seeing the makeup of the panel Senate President Bob
Travaglini (D-East Boston) invited to brief state senators on lessons learned
from the last state fiscal crisis.
There were plenty of voices for higher taxes, but no
sign of Weld administration veterans, Citizens For Limited Taxation leaders or even past
legislative leaders who fought off tax increases in the late 1980s and early
1990s - all arguably having some insight into how to solve a fiscal crisis without
raising taxes.
A Boston Herald editorial
Mar. 6, 2003
Taxers sing same old song
House budget-writers were sternly warning that local
aid was squarely on the chopping block, but the state's mayors said they couldn't cope with the
cuts. Suddenly, the mayors were leading a charge for a tax hike, and, largely through
the efforts of House Speaker Thomas M. Finneran, the Legislature raised taxes
by a record $1.2 billion - averting the local aid cuts altogether.
That was 12 months ago. Now, the same dance appears
to have started anew on Beacon Hill....
The drama set off a deja vu feeling on Beacon Hill.
Some observers saw Rogers's statements and the ensuing tempest of tax talk
from the mayors as the start of a complicated set of maneuvers between legislative leaders, local officials, and advocacy
groups, the point of which is setting up a big tax vote this spring.
"They're beginning the drum beat for the tax increase," said
Barbara Anderson, executive director of Citizens for Limited
Taxation.
The Boston Globe
Mar. 6, 2003
Deja vu: Mayors talk tax increases
Meanwhile, tax-hike conspiracy theories were
percolating at the State House yesterday, after mayors began clamoring for tax hikes immediately in
the wake of House leaders' warnings of a 20 percent local aid cut.
Senate Minority Leader Brian P. Lees accused Democratic leaders of
brandishing the local aid threat after realizing that Romney had come up with
a non-tax solution to the $3 billion deficit.
"They're trying to scare their members," Lees (R-East Longmeadow) said.
"They wanted more cuts, and they wanted those cuts to be able to trigger
another major tax increase."
The Boston Herald
Mar. 6, 2003
Gov tells lawmakers,
state officers to cut own costs
Without relief from state budget cuts, Boston is
planning to ax 550 teachers and 500 other public school employees, Superintendent Thomas Payzant said
last night after hearing from outraged parents at a meeting in Roxbury....
Parents angry with pending cuts at their kids' schools vented during the
hearing, and Payzant urged them to tell state leaders to allow more taxes or
fees.
The Boston Herald
Mar. 6, 2003
Boston schools prepare to lay off 1,050
When it comes to business, the Romney administration
is "closing tax loopholes, not changing tax policy," insists Robert Pozen, the governor's chief
economic adviser....
In fact, liberals would argue it is time to do more
than close three corporate tax loopholes. It is time to roll back the tax breaks doled out to business in
the 1990s, which were specific enough to benefit specific companies - Raytheon,
Fidelity Investments, and John Hancock Financial Services....
Pozen says the Romney administration does not support specific tax breaks to
lure specific companies to Massachusetts. But Romney officials, he says, do
support the changes to corporate tax policies made during the revenue-rich
1990s.
Their view is shared by Michael Widmer, the head of
the Massachusetts Taxpayers Foundation. "They are legitimate tax reforms that improve the
competitiveness of the Massachusetts economy over time. It encourages business to locate and expand
here."
The three loophole closings signed into law by Romney could produce up to
$300 million in additional revenue to Massachusetts, Pozen estimated yesterday....
The Boston Globe
Mar. 6, 2003
A first step on business taxes
By Joan Vennochi
But those who care about taxes and services in this
state should keep an eye on how the Legislature handles the line-items so important to public
employee unions. Romney chose not to fight the police unions over reform of the wasteful
Quinn Bill and lucrative police details. Will the Legislature choose to cut local
aid deeper or raise taxes higher in order to keep employee health benefits
intact?
A MetroWest Daily News editorial
Mar. 6, 2003
Romney vs. the unions
State highway officials are threatening potential
layoffs or payless paydays for hundreds of state workers in two weeks if lawmakers don't plug a $46.8
million hole in the state's snow removal budget....
Lawmakers chronically underfund snow-and-ice removal, but last year they
slashed the account by $25 million - leaving only $12.1 million for what
turned out to be an unexpectedly harsh winter.
The Boston Herald
Mar. 6, 2003
Layoffs threatened if snow fund not replenished
As we advised yesterday, the old Tax Hike Express bus has
been tuned up, its oil changed, and it's warming up in the garage, ready to be rolled out for another tour. If it feels
like you've been here before that's because you have, just last year.
It's the same tax-hike game plan, the same strategy that
worked last year ... except that this year is different.
What state Rep. John Rogers and new Senate President Travaglini and the rest of the
usual suspects don't seem to recognize is that the climate has changed; it changed with the
last election.
For one thing, they almost lost the entire income tax to
Carla Howell's abolition campaign. Did they miss that one, or have they just entirely forgotten already? Most of their
"members" in "The Great and General Court" remember, at least vaguely.
For another, Shannon O'Brien is not governor, and for good
cause. If elected, she wanted to raise taxes, and now she's a retired memory.
Oh but it's coming at us nonetheless. These are the same
"leaders" who still haven't figured out that it snows in the winter - which says a whole lot.
They'll motivate the usual suspects of course -- the usual
suspects have been just waiting for their marching orders.
But can they suck in enough other legislators to get a two-thirds vote for a second wave of
"The Biggest Tax Increase in State History" on top of Governor Romney's fee creations
and increases after the governor vetoes their tax hikes? Are there enough of them out
there with a political death wish ... or a better job offer in this economic climate?
Time will tell, but the Tax Hike Express is loaded up and on
the move.
Is there any wonder why Michael Widmer ("Mickey W") of the
so-called Massachusetts Taxpayers Foundation has been quietly advocating this year for an increase in the state
sales tax?
Just this past Monday, the Boston Herald reported ("Tax cuts
in the crosshairs"):
Today, we learned that closing just three corporate tax
"loopholes" yesterday will save the state $300 million, and that's not yet even touching the tax breaks that specifically
were given to three of MTF's member corporations.
Is there any wonder why Mickey W -- MTF's lead lobbyist -
has been desperately trying to promote major tax increases on us average taxpayers?
By the way, note that "rolling back" seems to be the Gimme
Lobby's latest choice of vernacular when addressing the business tax credits of the '90s. This indicates that
apparently rollbacks move only in one directions -- up, higher, more revenue for them to
spend. Curiously, they "roll back" tax loopholes and credits, but "freeze" tax rollbacks
adopted by the voters.
Then we have Governor's Romney's dubious "user fee" creations and increases, not tax
hikes, though the state treasury grows fatter regardless of the terminology.
The English language sure is taking an all-around beating
during this budget season. It's like George Orwell's Ministry of Truth in his novel "1984" -- Doublespeak, where "war is
peace," "freedom is slavery," and "ignorance is strength." Does anybody know what
anybody else is talking about any more?
Finally today, what would the end of winter be without the
perennial rite of passage: news reports about how "The Best Legislature Money Can Buy" underfunded the state's snow
removal budget and instead spent the money on Something Else. Wouldn't you think that
by now -- after some 380 winters since the old Massachusetts Bay Colony was first settled
-- they'd have figured out that ... winter happens?
The Boston Herald
Thursday, March 6, 2003
A Boston Herald editorial
Taxers sing same old song
Did some invitations get blown off the porch, Trav? That's
the only conclusion we could reach after seeing the makeup of the panel Senate President Bob
Travaglini (D-East Boston) invited to brief state senators on lessons learned
from the last state fiscal crisis.
There were plenty of voices for higher taxes, but no sign of
Weld administration veterans, Citizens For Limited Taxation leaders or even past
legislative leaders who fought off tax increases in the late 1980s and early
1990s - all arguably having some insight into how to solve a fiscal crisis without
raising taxes.
But since he's already voiced support for higher taxes,
perhaps Travaglini feared he'd get advice he wasn't looking for.
Particularly troubling were his choices of former Senate
Ways and Means Chairman Patricia McGovern and former Tax Equity Alliance for
Massachusetts head James St. George.
McGovern was one of the chief architects of the late 1980s
tax increases that put off tough budget decisions and helped send the state spiraling even deeper
into recession. St. George's singular mission as head of TEAM was to fight for
higher taxes to feed bigger government.
Not surprisingly, both McGovern and St. George urged state
senators to raise taxes to solve this fiscal crisis.
Let's hope the majority of state senators listening to the
panel's presentations took away a different message than Travaglini intended: They still don't get it.
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The Boston Globe
Thursday, March 6, 2003
Deja vu: Mayors talk tax increases
By Rick Klein, Globe Staff
House budget-writers were sternly warning that local aid was
squarely on the chopping block, but the state's mayors said they couldn't cope with the cuts.
Suddenly, the mayors were leading a charge for a tax hike, and, largely through
the efforts of House Speaker Thomas M. Finneran, the Legislature raised taxes
by a record $1.2 billion - averting the local aid cuts altogether.
That was 12 months ago. Now, the same dance appears to have
started anew on Beacon Hill. House Ways and Means Committee chairman John H. Rogers
on Monday warned cities and towns to expect cuts of as much as 20 percent in
state aid, and on Tuesday, mayors emerged from a State House meeting with
Governor Mitt Romney, imploring the Legislature to consider new taxes when
balancing the budget for fiscal 2004.
"If they're going to hit us this hard, you need some
additional revenues," Lynn Mayor Edward J. "Chip" Clancy Jr. said.
The drama set off a deja vu feeling on Beacon Hill.
Some observers saw Rogers's statements and the ensuing
tempest of tax talk from the mayors as the start of a complicated set of maneuvers between
legislative leaders, local officials, and advocacy groups, the point of which is
setting up a big tax vote this spring.
"They're beginning the drum beat for the tax increase," said
Barbara Anderson, executive director of Citizens for Limited
Taxation.
It's too soon to tell whether legislative leaders have
another tax hike on deck this year, or whether Rogers's comments were simply what he said they were:
an attempt to educate the public about the dire fiscal situation. Most
legislative leaders have said that tax hikes are unlikely to be seriously considered, though
Rogers, a Norwood Democrat, and Senate President Robert E. Travaglini, an
East Boston Democrat, have predicted that the appetite for taxes, among both
lawmakers and the public, could increase when people see the extent of cuts
necessary in the fiscal year that starts July 1.
The fiscal crisis is every bit as severe as it was last
year. Even with last year's tax increase boosting revenues this year, the state is facing a gap of as much as
$3.2 billion between expected revenues and the amount of spending that would
be necessary to maintain current levels of state services.
But if Democrats in the Legislature do push another round of
tax increases, they'll be doing so in a far more difficult political environment. Lawmakers
voted to raise taxes last year, and voters have indicated since then - through
the election of Romney, among a raft of other votes, and public opinion polls -
that they would rather see spending cut than see their taxes raised again.
Perhaps more important, Romney has high public approval, and
is offering his budget plan as an alternative to higher taxes. He has called for closing $2 billion
of the budget deficit through a series of changes, including fee hikes, the sale of
excess state land, and a comprehensive government restructuring package.
"The way we can avoid deeper reductions in local aid is for
the Legislature to adopt the governor's budget in its entirety," said Eric Fehrnstrom, Romney's
communications director. "If we can do this, then we can avoid taxes and
eliminate once and for all the structural gap between spending and revenues in
Massachusetts."
At the same news conference where he warned of 20 percent
local aid cuts, Rogers quickly noted that he doesn't see the will coalescing in the Legislature
for new taxes. He said he doubts whether two-thirds of House members would
vote for a tax hike - the threshold needed to override the veto being promised
by Romney.
"I just don't see it happening," Rogers said. "The sentiment
of most of my colleagues in the House is that this budget will have no new taxes in it."
Still, those same concerns were voiced last year, when
Acting Governor Jane Swift was promising to veto tax hikes. Then, of course, the Massachusetts
Municipal Association was joined by other influential organizations in
supporting new taxes, including business groups, and Finneran engaged in a
cross-state trip where he rallied support at the grass-roots level.
Talking about cuts without considering new revenue sources
would be irresponsible of state leaders, said Newton Mayor David Cohen. The fiscal
crises that cities and towns are facing are the result of the drop-off in state tax
revenue, so state taxes must remain on the table, he said. "The state has to
participate," Cohen said. "We need a balanced approach."
On Tuesday, Romney held a tense meeting with more than 30
mayors, including many who have accused the governor of misleading the public about
the extent of his proposed local aid cuts. After the meeting, Romney promised
to do a better job explaining his recommendations, and raised the possibility of
revising the formulas he would use to distribute aid to reflect the mayors'
concerns.
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The Boston Herald
Thursday, March 6, 2003
Gov tells lawmakers, state officers to cut own costs
by Elisabeth J. Beardsley
Gov. Mitt Romney yesterday challenged lawmakers and the
other constitutional officers to clean up their own budgetary houses with
self-imposed cuts - or face an involuntary gubernatorial intervention.
"I am expecting them to come forward with economies and
improvements which they themselves generate," Romney said. "If I were to be disappointed
on that front, then I might adopt a different tact."
But two of the Democratic constitutional officers - Auditor
Joseph DeNucci and Secretary of State William Galvin - immediately balked.
And it remains unclear what Romney will do if the Democratic
lawmakers and constitutional officers don't cut their budgets, given the limited power of the
governor to intervene in their business.
DeNucci protested Romney's budget-cutting challenge, saying
his level-funding doesn't compensate for inflationary increases.
With 17 fraud investigations under way, DeNucci said he
doesn't have room to make cuts - and said a fiscal crisis is the "wrong time" to slash oversight
agencies that could help recover money.
"Any significant cuts in our budget will hamper our ability
to assist in these investigations," DeNucci said.
DeNucci acknowledged it would be "lying" to claim that every
one of his 300 staffers is "absolutely necessary," but he said laying off administrative staffers
would force auditors to "answer phones."
Galvin - who dropped out of the gubernatorial race last year
- saw his budget hold steady at $6.6 million. The secretary also looked askance at Romney's
challenge - noting that beyond his office expenses, Romney shaved $499,000
out of accounts that had been beefed up for last year's elections, which Galvin
oversees.
"I don't have that much to complain about, but what am I
going to do - not have a corporations division?" Galvin asked.
The governor's remarks came after a breakfast forum hosted
by The Partnership, a Boston-based group that promotes relationships between the
business and minority communities.
Meanwhile, tax-hike conspiracy theories were percolating at
the State House yesterday, after mayors began clamoring for tax hikes immediately in the wake
of House leaders' warnings of a 20 percent local aid cut.
Senate Minority Leader Brian P. Lees accused Democratic
leaders of brandishing the local aid threat after realizing that Romney had come up with a
non-tax solution to the $3 billion deficit.
"They're trying to scare their members," Lees (R-East
Longmeadow) said. "They wanted more cuts, and they wanted those cuts to be able to trigger
another major tax increase."
House Ways and Means Chairman John H. Rogers flatly denied
the charge, saying the voters spoke with the force of a "mandate" when they elected
Romney on an anti-tax platform.
Elizabeth W. Crowley contributed to this report.
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The Boston Herald
Thursday, March 6, 2003
Boston schools prepare to lay off 1,050
by Kevin Rothstein
Without relief from state budget cuts, Boston is planning to
ax 550 teachers and 500 other public school employees, Superintendent Thomas Payzant said
last night after hearing from outraged parents at a meeting in Roxbury.
"This is the most challenging budget season I've experienced" during 30 years
in education, Payzant said.
Parents angry with pending cuts at their kids' schools
vented during the hearing, and Payzant urged them to tell state leaders to allow more taxes or
fees.
Payzant has asked schools to trim 10 percent from their
budgets to help close a predicted $119 million deficit next fiscal year. Parents have slowly learned of
the cuts over the past several weeks.
"We live in a city that calls itself a world-class city, yet
treats its children like second-class citizens," said Michael Kincade.
With the School Committee set to approve a budget March 26,
some complained they could hardly comment on a plan they won't see until it's
almost too late.
"We can't see where the priorities really lie," said Peggy
A. Wiesenberg of the Citywide Parent Council. "We don't know right now if there's full funding for
kindergarten or early education or not, or whether in efforts to create some of
the smaller high schools if they're taking money from existing high schools."
Payzant also has suggested closing five, so far unidentified, schools for $5-6
million in savings; $10 million saved from changing school bus contractors; and
$8 million from boosting maximum class size to as high as 34 students in a high
school class.
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The Boston Globe
Thursday, March 6, 2003
A first step on business taxes
By Joan Vennochi
Is closing a corporate tax loophole the same thing as
raising a corporate tax?
Not in the lexicon of Governor Mitt Romney, who makes
similar distinctions between raising taxes - bad - and raising fees - good.
When it comes to business, the Romney administration is
"closing tax loopholes, not changing tax policy," insists Robert Pozen, the governor's chief
economic adviser.
Call it whatever you like; Massachusetts business is not
pleased about it. Hundred of businesses wrote letters protesting the corporate tax increases -
no, make that corporate loophole closings - which Romney yesterday signed
into law.
The ire over the corporate tax changes follows ire expressed
publicly by business leaders that Romney is pursuing too much of a pro-environment,
antibusiness agenda.
For the first affront, business blames Douglas Foy. Once one
of the state's most aggressive enviromental activists, Foy now serves as Romney's chief of
Commonwealth Development.
At least Foy's agenda inside the State House is consistent
with his past career outside the State House. Squeezing money out of the Commonwealth's
corporate citizenry is an entirely new role for Pozen, a former vice chairman of
Fidelity Investments. As a top executive for the giant mutual funds industry,
he has argued for what the average person calls tax breaks - and what he calls
"bona fide tax policy" - for business.
"This administration has said it is not going to be
proposing new taxes. That is a very different thing from enforcing taxes and tax provisions on the book,"
argues Pozen. It's a first step in standing up to business. Liberals would
like to see more.
Of course, to liberals in the commonwealth - there must be
some left - this is not a tough argument to make. In fact, liberals would argue it is time to do
more than close three corporate tax loopholes. It is time to roll back the tax
breaks doled out to business in the 1990s, which were specific enough to
benefit specific companies - Raytheon, Fidelity Investments, and John Hancock
Financial Services. And more than that, some might argue that this is the right
time to look at the fundamental fairness of the Massachusetts tax code, and ask
the question: Is business paying its fair share?
The answer to that question: No. Pozen definitely does not
think this is the time to ask the question, is business paying its fair share? It would be
"counter-productive" to reverse those tax breaks - oops, "bona fide tax"
policies.
"We need to be looking at a different question: How do we
encourage more businesses to put more jobs in Massachusetts?" he says.
Pozen says the Romney administration does not support
specific tax breaks to lure specific companies to Massachusetts. But Romney officials, he says, do
support the changes to corporate tax policies made during the revenue-rich
1990s.
Their view is shared by Michael Widmer, the head of the
Massachusetts Taxpayers Foundation. "They are legitimate tax reforms that improve the
competitiveness of the Massachusetts economy over time. It encourages business to locate and expand
here."
The three loophole closings signed into law by Romney could
produce up to $300 million in additional revenue to Massachusetts, Pozen estimated
yesterday. Two are entirely prospective, closing tax loopholes going forward.
But one, relating to taxes paid by a so-called REIT or "real estate investment
trust" would allow the state Department of Revenue to go back to 1999 assessments.
The REIT loophole closing is a little difficult for Pozen to
justify. "In the first two cases, they are entirely appropriate," he says. He stops, then starts again.
"All are appropriate. All are appropriate loophole closings. I would prefer not to
have anything retroactive. In general, for a stable environment you try to
change things going forward."
The governor will absolutely, positively never raise taxes.
He will raise fees, close loopholes, and, in the instance of the REIT assessments, bend political
ideology to fit political need. Then he will let Pozen try to explain it.
It's actually quite simple to explain. "There's a lot of
money at stake," as Pozen says. Massachusetts needs money and a lot of it.
Return to top
The MetroWest Daily News
Thursday, March 6, 2003
Editorial
Romney vs. the unions
Of all the changes Gov. Mitt Romney included in the budget
he proposed last week, few face a steeper uphill climb than his efforts to take some of the deficit
out of the hides of the public employee unions.
Romney called for cutting the state's contribution for
employee health insurance from 85 percent to 75 percent, a suggestion the Legislature ignored
when he proposed it as part of his plan to balance the current budget. He called
for the elimination of the Pacheco Law, which has effectively halted the
privatization of government functions. He wants managers taken out of the
unions representing the people they supervise.
Romney also wants to eliminate "bumping," which allows
workers whose jobs are eliminated to take the job of any worker with less seniority, whether or not
they are qualified to do the work. Under this provision, for instance, a laid off
financial analyst could appropriate the job of a child care supervisor, one Weld
adviser suggests.
Not all these reforms would produce immediate savings. But
as Romney knows from his experience as a corporate turnaround specialist, downsizing is an
opportunity to strengthen an organization as well as save money. Work rules
and bumping privileges prevent managers from putting the right people in
the right jobs. When cutting costs, it's even more important to get the most out of
the people you keep.
Raising the employee health insurance contribution would
produce millions of dollars in immediate savings. Payroll and benefits make up by far the largest
piece of the budget pie, and you don't have to be in government to know that
health insurance costs are escalating.
Romney would like to make those savings available to cities
and towns, some of which also contribute as much as 85 percent of the cost of health insurance
premiums. Capping the public contribution at 75 percent could be worth as
much as $2 million to Framingham's budget.
Romney's legislation will make the insurance cap mandatory,
a clause that would be quietly welcomed by many local officials, who want the savings, but
would rather not have to fight town employees on Town Meeting floor to get it
enacted.
Romney has taken some criticism for overstating the amount
of savings in his budget, an offense which has been, in our experience, a fairly common
misdemeanor. But the governor's proposal is the first word in the budget
process, not the last. If the House and Senate can come up with more credible
figures, or with alternative strategies to balance the budget, fine.
But those who care about taxes and services in this state
should keep an eye on how the Legislature handles the line-items so important to public employee
unions. Romney chose not to fight the police unions over reform of the wasteful
Quinn Bill and lucrative police details. Will the Legislature choose to cut local
aid deeper or raise taxes higher in order to keep employee health benefits
intact?
To budget is to choose, and the choices this year will be
tougher than they have been in a long time. The House and Senate must do more than beat up on
Romney's budget; they must find a better way to balance the books.
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The Boston Herald
Thursday, March 6, 2003
Layoffs threatened if snow fund not replenished
by Elisabeth J. Beardsley
State highway officials are threatening potential layoffs or
payless paydays for hundreds of state workers in two weeks if lawmakers don't plug a $46.8 million
hole in the state's snow removal budget.
Transportation Secretary Dan Grabauskas has fired off a memo
to legislative leaders, warning that the $12.1 million snow-and-ice removal account has long
since run dry.
"Because it's been a very aggressive snow-and-ice season and
we've had a lot of operations, we've burned through a lot of overtime," said
Grabauskas' spokesman Jon Carlisle.
Lawmakers chronically underfund snow-and-ice removal, but
last year they slashed the account by $25 million - leaving only $12.1 million for what turned
out to be an unexpectedly harsh winter.
Massachusetts Highway Department officials had only budgeted
$1.5 million for overtime related to snowstorm cleanups, but the tab, to date, stands at $3.1
million, Grabauskas' memo states.
Snowplow operators have been working without pay since Dec.
21, and highway officials are hoping they will "continue providing services without
payment for the majority of the winter," the memo states.
While that situation is typical for any winter, the major
problem this year is that the highway department uses most of the money in the snow-and-ice
overtime account to pay the salaries of employees who don't have anything to
do with snow removal.
The huge snow-related overtime tab is now squeezing the
payroll for 188 workers in the offices of Highway Commissioner John Cogliano, the agency's
chief counsel, the civil rights division, human resources, information technology,
administrative services and the budget office.
Payroll money is projected to run out March 22, and if
lawmakers don't come up with $47 million, Carlisle said, Grabauskas would scour for possible cuts to
utilities and rent payments. As a "last resort," highway officials will consider
laying off workers or reneging on paychecks, Carlisle said.
While the shortfall in the snow-and-ice overtime account is
the most immediate problem, it isn't the only one by far.
Highway officials ended up needing $35.5 million worth of
hired equipment - after setting aside just $8.9 million. And where the original budget called for
$5.9 million worth of materials such as street sand, that account is now at $24.7
million.
With several weeks of iffy weather still ahead, all of the
snow-related deficiencies could yet balloon.
The burgeoning snow-and-ice shortfall throws the state
budget back out of balance after Gov. Mitt Romney just yesterday signed a bill to close a $650
million gap in the current fiscal year.
Neither House Ways and Means Chairman John H. Rogers nor
Senate Ways and Means Chairman Therese Murray returned calls seeking comment.
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