CLT
UPDATE
Monday, April 7,
2003
MTF exposed,
as tax opposition among public steady
CLT has done its part on the "new revenue project" with its bill to allow these tax hike proponents to pay more themselves when they file their income taxes. We assume that since the Legislature passed our bill last year, you recognize the value of voluntary tax payments, especially those from advocates who would urge you to force your other constituents to pay more again.
If all the citizens who voted against the income tax rollback in 2000 were to check off the higher 5.85% income tax rate, the additional revenue would help "save" whatever. For example, if each of this 1,055,181 voters volunteered just $32 additional dollars, the Medicaid program could be opened again for the 36,000 chronically unemployed. As the pro-tax hike advocates address the committee, we wonder if they themselves are choosing the higher rate, which is available on the 2002 state income tax forms.
CLT MEMO
To: House Revenue Task Force
April 7, 2002
Others planning to testify include: Massachusetts Taxpayers Foundation president Michael Widmer, Romney finance chief Eric Kriss, Fall River Mayor Edward Lambert, Northampton Mayor Claire Higgins, Brockton Mayor Yunits, and Secretary of State William Galvin on fees. A federal panel will include Federal Reserve officials and a Kennedy School expert.
There is persistent buzz that taxes will be raised, despite the public pronouncements of most Democratic leaders.
State House News Service
Advances - Week of April 7, 2003
Revenue task force hearing
Monday, 10 am, Gardner Auditorium
When it comes to leveling criticism at state lawmakers or the governor on spending policy, the Massachusetts Taxpayers Foundation has never been known to pull punches....
But while many praise the foundation for impartial analysis, its critics say the foundation is actually a pro-business lobbying group masquerading as a taxpayer watchdog.
"The reason they have influence is because they give legislators cover for raising taxes," said
Barbara Anderson, an anti-tax activist who is director of Citizens for Limited
Taxation. Anderson frequently spars with Widmer, and while she calls other organizations "opponents," she refers to the taxpayers foundation as "the enemy."
"People think they're a taxpayer group, but in fact, they are a big business-financed organization which has always been a proponent of raising taxes," said Anderson....
"The taxpayers foundation generally has been a reliable source of analysis about the state budget over the past decade," said Rep. James Marzilli Jr., D-Arlington. "Their legislative agenda on taxes is a lot more suspect. Frankly they're a lobbying association as well as a think-tank. It's not 'Just the facts, ma'am.' These folks have a political agenda determined by the people who pay the bills."
Marzilli notes that the taxpayers foundation has advocated keeping the statewide income tax at 5.3 percent rather than rolling it back to 5 percent as a 2000 referendum called for. At the same time, the group is lobbying to preserve the state's 3 percent investment tax credit that encourages corporations to add equipment.
The Lowell Sun
Sunday, April 6, 2003
Tax group shows muscle, irks critics
Despite their opposition to taxes, those surveyed appear convinced that tax increases are inevitable.
A majority, 57 percent, said it is not very likely that the state budget deficit will be closed without an increase in taxes, while 33 percent said it is "somewhat likely" tax increases will be avoided....
While 19 percent support raising the income tax, 55 percent oppose it.
19 percent are for increasing the sales tax, but 53 percent are against such a move.
25 percent of residents think raising fees for state services is a good idea, while 32 percent are opposed....
Asked whether Romney should consider raising taxes as part of his plan to close the budget gap, a clear majority - 57 percent to 35 percent - said no.
The Boston Globe
Monday, April 7, 2003
Poll finds a popular governor, fiscal woes
It might take some time, but inevitably a boom will follow this bust. That's why the state's leading business associations are urging policy makers to take off the dark glasses and look ahead.
Doing so requires that state leaders size up our competitive position and devise some strategies to help Massachusetts become a business magnet....
Taxes. Personal income tax burden is one of the heaviest in the country, and corporate income and property taxes are higher-than-average, while sales taxes are relatively low....
During the last two years, Massachusetts lost 157,000 jobs, or 4.7 percent of its total employment. No other state has lost as much as 4 percent, according to Northeastern University's Center for Labor Market Studies.
A Springfield Republican editorial
Monday, April 7, 2003
State must step up fight to gain an economic lift
Chip Ford's CLT
Commentary
As I write, Barbara and Chip Faulkner are in Boston. "Chipster"
is at the State House, attending the House revenue task force hearing and
hand-delivering copies or our memo (below) to members of the task force and to
all House members. Barbara is first attending a meeting of the Coalition
for Legislative Reform (the group of organizations representing the full
spectrum of political philosophies from left to right of which CLT has been a
member) to discuss state Sen. Stanley Rosenberg's bill to kill the initiative
process, before joining Chipster at the State House.
Things are heating up on Beacon Hill, and we're getting our
positions across. From the Boston Globe today we have a poll that shows that
taxpayers still reject tax increases to "solve" the so-called budget
crisis: A strong 57 percent oppose raising taxes. Sadly, citizens have become so
disillusioned that they live in a representative state government that only 33
percent think their opinion means anything on Beacon Hill, while 57
percent think another tax hike is more likely than not.
But the attention we've focused on the so-called
Massachusetts Taxpayers Foundation has begun to pay off, revealing the true
objectives of a lobbying group that has been seen as "nonpartisan" and
"highly-respected" for too long.
When a State House reporter starts asking the right
questions, you get everyone thinking, and Lowell Sun reporter Erik
Arvidson accomplished that with his report yesterday! This is only the
beginning; the MTF's dike of respectability has at last sprung a leak, its dirty
little secret is exposed. What we prefer to call the Massachusetts Taxspenders
Foundation is losing its gloss.
Arvidson observed: "The taxpayers foundation is seen as more conservative than the progressive Massachusetts Budget and Policy
Center," formerly know as TEAM (Tax Everything And More). Yeah, and
MTF is probably more conservative than Karl Marx too, since its mission is to
promote advantages for its Big Boston Fat Cat corporate members on the backs of
average taxpayers.
Note for the record that the Springfield Republican
today is preaching economic recovery and long-range plans to sustain it. Perhaps
this is the influence of the paper's name-change from the Springfield
Union-News, which was second only to the Boston Globe in perpetually advocating
for higher taxes. Springfield's daily paper-of-record has yet to acknowledge any
connection between "Personal income tax burden is one of the heaviest in the
country" and "Massachusetts lost a greater percentage of its jobs than any other state in the nation."
Maybe the name-change will confuse its editors enough that some will recognize
the obvious, despite its past knee-jerk dogma.
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Chip
Ford |
CLT MEMO
To: House Revenue Task Force
April 7, 2002
Citizens for Limited Taxation supports Governor Romney's determination to address the budget discussion without more new taxes, and we are glad that recent public statements from House members imply a lack of desire to raise taxes again. Massachusetts taxpayers have already done their share, having provided all the existing available revenues, including the new ones from last year's "biggest tax hike in state history."
Our state tax burden, per capita, is the 5th highest in the nation; our state spending per capita ranks 6th. You will be told that the tax burden relative to personal income is lower, but the existence of many wealthy people in Massachusetts does not make it easier for ordinary middle-income taxpayers to pay higher taxes. We would point out that our property taxes, water and sewer charges, oil, gas, electricity and gasoline prices are increasing, and many of us are unemployed so these higher costs, along with our high tax burden, severely impact our standard of living.
In light of the fact that Massachusetts' per pupil costs are 5th highest in the nation (24% above the national average), claims by tax hike proponents that new taxes are needed to "save our schools" seem to be shameful exaggerations. Their other claims that new taxes are needed to "save health care, jobs, child care and housing" don't take into account that these new taxes would be paid by people whose health care, child care and housing costs are high and escalating. But new taxes on business could cause more private sector jobs to be lost.
CLT has done its part on the "new revenue project" with its bill to allow these tax hike proponents to pay more themselves when they file their income taxes. We assume that since the Legislature passed our bill last year, you recognize the value of voluntary tax payments, especially those from advocates who would urge you to force your other constituents to pay more again.
If all the citizens who voted against the income tax rollback in 2000 were to check off the higher 5.85% income tax rate, the additional revenue would help "save" whatever. For example, if each of this 1,055,181 voters volunteered just $32 additional dollars, the Medicaid program could be opened again for the 36,000 chronically unemployed. As the pro-tax hike advocates address the committee, we wonder if they themselves are choosing the higher rate, which is available on the 2002 state income tax forms.
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State House News Service
Advances - Week of April 7, 2003
Revenue task force hearing
Monday, 10 am, Gardner Auditorium
Boston Mayor Thomas Menino is expected to ask lawmakers Monday to give cities and towns the power to raise so-called local option taxes on items like meals, hotel rooms, and parking in city lots. The mayor's pitch is part of a public hearing by a House panel appointed by Speaker Thomas Finneran that is investigating ways to raise revenue to solve the state's fiscal crisis.
As a warning to lawmakers, Gov. Mitt Romney says that if just taxes were used to solve the fiscal crunch, the sales tax would need to rise from 5 percent to 6 percent and the income tax from 5.3 percent to 6.5 percent. This 20 percent increase in sales and income taxes would cost a typical family about $1,000 each year, Romney says.
The revenue task force hearing is co-chaired by Rep. Daniel Bosley (D-North Adams) and Rep. Paul Casey (D-Winchester).
Others planning to testify include: Massachusetts Taxpayers Foundation president Michael
Widmer, Romney finance chief Eric Kriss, Fall River Mayor Edward Lambert, Northampton Mayor Claire Higgins, Brockton Mayor
Yunits, and Secretary of State William Galvin on fees. A federal panel will include Federal Reserve officials and a Kennedy School expert.
There is persistent buzz that taxes will be raised, despite the public pronouncements of most Democratic leaders.
Asked if there was talk about tax hikes this year, Casey, House chair of the taxation Committee, said, "From extreme groups? Yes. But from reps and senators? No."
Some of the groups pushing for tax hikes include the Massachusetts Municipal Association and the Massachusetts Teachers Association.
Given Romney's opposition to new taxes, task force members may be giving the range of state fees a closer examination as well as other tax law changes that could fall under the category of closing loopholes.
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The Lowell Sun
Sunday, April 6, 2003
Tax group shows muscle, irks critics
By Erik Arvidson
Sun Statehouse Bureau
When it comes to leveling criticism at state lawmakers or the governor on spending policy, the Massachusetts Taxpayers Foundation has never been known to pull punches.
After Gov. Mitt Romney announced with great fanfare in February that he'd rooted out $2 billion in waste, foundation president Michael Widmer asserted that the governor's plan was based partly on "one-time fiscal gimmickry."
Widmer aggressively hammered Romney's budget for relying too heavily on program cuts and fees, while only eliminating "tens of millions of dollars" in bona fide government waste.
Days later, Romney backed down and acknowledged that while "there may be $2 billion in waste and inefficiency" in state government, his budget had not found it all.
Widmer says the governor and his aides may have been blindsided by the foundation's criticism.
"I'd be surprised if they weren't rankled," Widmer said last week. "We've become a bone of contention over the years, and there is almost nobody in the state leadership that we haven't rankled at one time or another."
Often quoted by House Speaker Thomas Finneran and other legislative leaders as an authoritative source of budget and tax analysis, the taxpayers foundation is one of the leading influences on public policy in the Statehouse. But while many praise the foundation for impartial analysis, its critics say the foundation is actually a pro-business lobbying group masquerading as a taxpayer watchdog.
"The reason they have influence is because they give legislators cover for raising taxes," said
Barbara Anderson, an anti-tax activist who is director of Citizens for Limited
Taxation. Anderson frequently spars with Widmer, and while she calls other organizations "opponents," she refers to the taxpayers foundation as "the enemy."
"People think they're a taxpayer group, but in fact, they are a big business-financed organization which has always been a proponent of raising taxes," said Anderson.
Nonetheless, Finneran and other state leaders quote the taxpayers foundation's analysis with confidence, insisting the foundation is the most objective of the state's policy think-tanks.
"I certainly deem them to be one of the more credible organizations, and it seems to me that most members of the House accord them a similar respect and stature," Finneran said. "That's not to say that we agree all the time."
Finneran noted that the taxpayers foundation was strongly critical of the Legislature in the late 1990s, under both the Weld and Cellucci administrations, for spending too much of the state surplus. "But just because they are critical does not in my eyes render them an organization we should not listen to," Finneran said.
Sen. Steven Panagiotakos, a Lowell Democrat, agrees that the taxpayers foundation is more objective than many other policy organizations, such as the Citizens for Limited Taxation or the Pioneer Institute for Public Policy.
"They're one of the most credible organizations that looks at state government," said
Panagiotakos, vice chairman of the Senate Ways and Means Committee. "The group, and Widmer especially, always seem to be right down the rails, whether it bolsters a Republican or a Democrat. They always do their homework well and know the issues."
But other lawmakers and Anderson question the foundation's objectivity, noting that it is funded entirely by corporations and lobbies for tax benefits and credits for businesses.
"The taxpayers foundation generally has been a reliable source of analysis about the state budget over the past decade," said Rep. James Marzilli Jr., D-Arlington. "Their legislative agenda on taxes is a lot more suspect. Frankly they're a lobbying association as well as a think-tank. It's not 'Just the facts, ma'am.' These folks have a political agenda determined by the people who pay the bills."
Marzilli notes that the taxpayers foundation has advocated keeping the statewide income tax at 5.3 percent rather than rolling it back to 5 percent as a 2000 referendum called for. At the same time, the group is lobbying to preserve the state's 3 percent investment tax credit that encourages corporations to add equipment.
The foundation is also arguing to preserve the generous business tax breaks of the 1990s, including the single sales factor tax on manufacturers and mutual funds.
The Legislature approved the single sales factor tax to help retain major employers Raytheon and Fidelity, whose corporate tax is calculated by their in-state sales, not their payroll or property.
Marzilli and other lawmakers want to revisit those tax breaks, saying the state's financial burdens should be shared by corporations and individuals.
Additionally, Anderson questions some of the taxpayers foundation's recommendations for balancing the budget, including borrowing to cover a portion of the deficit, a plan that Romney opposes.
"(The foundation) is pushing for more borrowing in a state with highest debt load in the nation. Borrowing our way out of this doesn't make any sense," Anderson said.
The taxpayers foundation is seen as more conservative than the progressive Massachusetts Budget and Policy Center, which has advocated for tax hikes over spending cuts to preserve services for the needy.
The foundation is still seen as more moderate than groups such Anderson's Citizens for Limited Taxation, which blames the fiscal crisis on overspending as opposed to tax cuts.
Last fall, Widmer went toe-to-toe in debates with Carla Howell, the Libertarian candidate for governor who was pushing Question 1, which would have eliminated the state income tax.
Widmer worked under two administrations before joining the taxpayers foundation. He was chief deputy secretary for former Gov. Michael Dukakis, a Democrat, and was also special assistant to the Secretary of Human Services under former Gov. Francis
Sargent, a Republican.
A resident of Belmont, Widmer serves as the chairman of the town's finance committee.
"In Belmont, he behaves like a mainstream Democrat, but when it comes to politicking he behaves like a Republican," Marzilli said.
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The Boston Globe
Monday, April 7, 2003
Poll finds a popular governor, fiscal woes
By Frank Phillips, Globe Staff
As he nears his 100th day in office, Governor Mitt Romney is enjoying generally favorable reviews from Massachusetts residents, but he faces public skepticism about his handling of the state's fiscal situation and his assertion that he can balance the budget without cutting core state services, a Boston
Globe/WBZ-TV poll shows.
The poll of 400 state residents, taken Monday through Wednesday of last week, also shows the public is strongly opposed to most of the major proposals being discussed on Beacon Hill to close the budget gap: cutting health and human service programs, reducing state aid to cities and towns, and raising taxes.
Despite their opposition to taxes, those surveyed appear convinced that tax increases are inevitable.
A majority, 57 percent, said it is not very likely that the state budget deficit will be closed without an increase in taxes, while 33 percent said it is "somewhat likely" tax increases will be avoided.
The survey - the first comprehensive poll taken since Romney assumed office - was conducted by KRC Communications Research and has a margin of error of plus or minus 5 percentage points.
It shows that Romney is relatively popular - with 55 percent of respondents expressing a positive view of him, and 32 percent a negative one.
But only a bare majority, 51 percent, approves of his handling of the budget, while 40 percent disapprove.
And that concern is affecting his overall job performance rating, with 55 percent expressing approval and 39 percent disapproval.
Among those who disapprove of the job Romney is doing, the primary reasons cited are his fiscal management and budget cuts.
In addition, 60 percent of those surveyed said the governor's deficit-reduction plans will cut core state services, while only 33 percent said those services will be protected. During last year's gubernatorial campaign, Romney pledged to preserve core services as he sought to make government more efficient.
Hazel Morse, a homemaker who was surveyed, said she likes Romney and wants to give him a chance, but said she disapproves of his approach to the budget, particularly cuts that hurt the elderly.
"He's trying to do something about it, but the worst thing is what is being done to the elderly," Morse said. "I have had double bypass surgery and my husband has diabetes. We use a lot of prescriptions and we can't afford them. It's outrageous. These are supposed to be the golden years and they are not. It's getting out of hand."
Shortly after taking office in January, Romney imposed spending reductions, including cuts to local aid and health care, to address this year's budget shortfall. In February he unveiled a budget for fiscal 2004, which called for a 5 percent reduction in almost every department in state government, and 2,000 layoffs.
The House and Senate will offer their own budget plans.
But the survey offers little comfort to state leaders as they try to find new revenues and cut spending to close next year's estimated $3 billion gap.
Regarding the various proposals on Beacon Hill to close the budget shortfall, the survey found:
While 19 percent support raising the income tax, 55 percent oppose it.
19 percent are for increasing the sales tax, but 53 percent are against such a move.
25 percent of residents think raising fees for state services is a good idea, while 32 percent are opposed.
20 percent back increasing higher education tuition and fees, compared with 45 percent who oppose it.
12 percent support reducing state aid to cities and towns, while 58 percent oppose such cuts.
The strongest opposition is expressed to cuts in health and human service programs. Some 73 percent oppose such reductions, while 8 percent support them.
Asked whether Romney should consider raising taxes as part of his plan to close the budget gap, a clear majority - 57 percent to 35 percent - said no.
Ross Pigott, who lives in Pittsfield, reflects the conflicting attitudes of many of those who were polled, saying she opposes program cuts but also does not want new taxes.
"I know they have to balance it somehow, but I couldn't afford another tax increase," said
Pigott, an assistant manager of a factory outlet whose husband is a disabled veteran. She said the budget makers should look to other sources of income such as casino gambling, lottery games, and raising specific taxes such as the levy on cigarettes.
Indeed, 65 percent said the plans to close the deficit would have a negative affect on them personally or their families, while only 12 percent said they would have a positive affect.
Although support for expanding legalized gambling appears to have slipped from previous years, a majority of those surveyed would favor such a move to deal with the budget shortfall. By 54 to 42 percent, respondents support the installation of slot machines to raise revenue; and by 54 to 41 percent, they back operation of stand-alone gambling casinos. A 1994 Globe poll found 61 percent supported legalized gambling, and 36 percent opposed it.
The state's fiscal situation appears foremost on residents' minds.
Twenty-one percent of those surveyed called fiscal issues the most important problem currently facing Massachusetts. In addition, 19 percent pointed to the economy; 13 percent, taxes; and 12 percent, education.
While relatively few residents expressed worry about their own economic security, a significant number are pessimistic about the state's future. Forty-seven percent said that Massachusetts is "seriously off track," while 39 percent said the state is "going in the right direction."
A majority - 56 percent - feel their communities would be able to adjust to Romney's proposed local aid cuts, but 43 percent said their cities or towns could not. The respondents were split on whether they would support a Proposition 21/2 override in their community, with 40 percent saying they would back an override and 44 percent saying they would oppose one.
The survey also found a significant gender gap in views about Romney and his approach to the budget.
Among male voters, 65 percent gave Romney a favorable job rating approval, while only 47 percent of women did. A similar disparity appears in their views of him personally, with 63 percent of men giving him a favorable rating, and 47 percent of the women rating him favorably.
As for his handling of the state fiscal crisis, Romney gains 60 percent of men's support, but only 42 percent of the women's. A strong majority of women - 67 percent - say his budget plan cuts into core state services, compared with 52 percent of the men surveyed.
The poll also underscores how heavily budget issues have dominated Romney's early months in office, and shaped the public view of him.
Among those who approve of Romney's job as governor, the most frequently offered reasons are his handling of fiscal issues and his proposal to reform and reorganize state government. Each of those issues was cited by 24 percent of those surveyed. Another 17 percent gave him credit for his management, while 12 percent said they like him because he understands the state's needs.
Of those who disapprove of his job performance, 37 percent say he is cutting state services too much, while 22 percent point to his fiscal management, and 9 percent say he is not in tune with the state. Another 7 percent say he lacks honest leadership.
The public views Romney more positively than the Legislature and its leadership.
Only 36 percent approve of the job being done by the lawmakers, while a near majority, 48 percent, disapprove. A similar poll taken in 1994 showed voters giving the Legislature a 26 percent approval rating, but the same - 48 percent - had unfavorable opinions.
With nearly 85 percent of the public knowing who he is, House Speaker Thomas Finneran is far better known than the recently elected Senate President Robert Travaglini. But Finneran is also held in low esteem, with a 23 percent favorable rating, 41 percent unfavorable.
Travaglini is viewed favorably by 10 percent of those surveyed, and unfavorably by 6 percent. The rest either had no opinion or didn't know him.
The Globe/WBZ poll also showed that Massachusetts residents support the US war in Iraq, by 64 to 30 percent. A Washington Post-ABC news poll taken last week showed that nationally, support for the war is higher. Three out of four Americans back the war, according to the Post poll.
Globe correspondent Cyndi Roy contributed to this report.
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The Springfield Republican
(Formerly the Union-News)
Monday, April 7, 2003
Editorial
State must step up fight to gain an economic lift
As Massachusetts remains mired in a nagging recession, it's difficult to imagine how the economy will ever climb out of it. But history has shown that the state economy will, indeed, recover.
It might take some time, but inevitably a boom will follow this bust. That's why the state's leading business associations are urging policy makers to take off the dark glasses and look ahead.
Doing so requires that state leaders size up our competitive position and devise some strategies to help Massachusetts become a business magnet.
Can the Bay State compete for business with large industrial states like Florida, Michigan, New York and New Jersey? How does Massachusetts compare with "high-technology" states like California, Colorado and North Carolina? And how do we stack up against the other New England states?
These are the challenges addressed in a new report, "Fragile Progress: Reining in Massachusetts' High Business Costs." The report, prepared by the Massachusetts Taxpayers Foundation with the Associated Industries of Massachusetts and the Greater Boston Chamber of Commerce, cites some progress over the last 10 years.
In a nutshell, the report says the state has some catching up to do before it can compete on an even playing field with other states that are scouting for business growth.
Ten years ago, according to the report, Massachusetts ranked well above the national average in five areas analyzed - health care, electricity, unemployment insurance, workers' compensation and taxes, but those advances have eroded in recent years.
Today, with the exception of workers' compensation, the costs of doing business in Massachusetts are well above average in the other four areas:
Health care. Double-digit increases in health care costs top the list of employers' concerns. Premiums for family health insurance plans were the third highest in the nation in 2000, and they remain higher than in any other high tech state.
Electricity. Commercial rates were 25 percent above the national average in 2000 and industrial rates are even further above average.
Unemployment Insurance. The state average rates remain among the highest in the nation. In 2002, the average cost per employee was 70 percent above the national average.
Taxes. Personal income tax burden is one of the heaviest in the country, and corporate income and property taxes are higher-than-average, while sales taxes are relatively low.
We agree with the conclusions of the Massachusetts Taxpayers Association and we agree with their prescription. Reforms and policies that have produced significant progress in reducing business costs relative to other states over the last decade must be preserved and strengthened. If the Legislature doesn't get busy on this agenda, the region could be the loser in the race to recover from the recession.
The stakes are very high. During this recession - and the 1989-1992 slump - Massachusetts lost a greater percentage of its jobs than any other state in the nation.
During the last two years, Massachusetts lost 157,000 jobs, or 4.7 percent of its total employment. No other state has lost as much as 4 percent, according to Northeastern University's Center for Labor Market Studies.
If the state takes another hit like this, the quality of life for residents of the commonwealth will deteriorate at an even faster rate.
The state's lawmakers cannot stand by and let that happen.
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