CITIZENS   FOR  LIMITED  TAXATION
and the
Citizens Economic Research Foundation

 

CLT UPDATE
Tuesday, November 18, 2003

"Absolutely, positively guaranteed, under law"


These facts paint the picture of a hands-on political leader taking care of business. That's why Finneran's testimony on Friday was so remarkable....

The judges may have to accept Finneran's mixture of ignorance and amnesia, however incredulous, especially if they accept the speaker's attempt to deny the courts access to memos and other communication between Finneran and Petrolati as inadmissible under the dubious doctrine of "legislative privilege." It seems to us this is the public's business, being conducted on the public's dime, and the public should be able to see what elected officials are up to.

The MetroWest Daily News
Tuesday, November 18, 2003
A MetroWest Daily News editorial
Finneran's amnesia 


To all outward appearances, Tom Finneran was in fine fettle as he entered the courthouse. But when he took the witness stand to testify, he blanked out and seemingly forgot what he had come into the courthouse to do. Even by Massachusetts standards, always so flexible, Speaker Finneran delivered an astonishing performance....

What is so disturbing about the Speaker's testimony, reported by the Herald under the headline Finneran forgets in court, is the way in which it feeds the dangerous fires of smoldering speculation that the state legislature of Massachusetts (aka General Court) is nothing more nor less than a criminal conspiracy for the benefit of a few favored insiders.

The MetroWest Daily News
Tuesday, November 18, 2003
Tom Finneran's 'senior moments'
By Peter B. Young


A stalled plan to protect homeowners from property tax increases that could top 40 percent lurched forward on Beacon Hill yesterday, as both Governor Mitt Romney and Senate President Robert E. Travaglini endorsed a compromise forged by Mayor Thomas M. Menino and members of the city's real estate community.

House Speaker Thomas M. Finneran and business groups remain cool to the idea ...

Under the compromise reached between Menino and real estate leaders, the new 200 percent limit would be phased out over several years, eventually returning to the 175 percent standard. Romney described the divergence between residential and commercial values as a "temporary phenomenon" likely to disappear by then....

But Brian Gilmore of Associated Industries of Massachusetts, the bill's primary opponent, said the group "is somewhat suspect of the provision that would have the rate return to the current position."

"It's very hard to guarantee the future actions of the Legislature," Gilmore said.

The Boston Globe
Tuesday, November 18, 2003
Compromise plan pushed to ease homeowner tax hikes


The politician's idea is to increase the state income tax by a marginal amount. Let's say 1 percent.

If you raised the income tax by 1 percent, he said, the state could collect an extra billion dollars a year, maybe even more.

And that billion would be absolutely, positively guaranteed, under law, to go back to the cities and towns to be used to pay the local bills....

And just like Menino has his critics, I'm sure there will be plenty of opposition to this idea of raising the income tax.

Again, the best question to ask is this: We hate all taxes. That's a given. But which tax do we hate more? Which is the more painful and unfair way to take our money from us and therefore in need of change? ...

To some, a bigger state income tax and more user fees may seem intolerable. But what's the alternative?

More foreclosures?

The MetroWest Daily News
Tuesday, November 18, 2003
Small tax pain could be a gain
By Tom Moroney


Oh sure, we taxpayers are about to buy another deceptive promise like another "temporary" tax hike, or revenue being "absolutely, positively" dedicated beyond however long it takes to suck in the public again! ...

"To some, a bigger state income tax and more user fees may seem intolerable. But what's the alternative? More foreclosures?" Moroney concluded; a false choice.

Spending at both local and state levels has doubled in a mere dozen years, most of those during low inflation. The honest alternative is spending restraint. The only result of continued fiscal irresponsibility is never-ending tax hikes at both levels.

If you to want breed an epidemic of foreclosures, just keep raising taxes.

Letter to the Editor
The MetroWest Daily News
Submitted: November 18, 2003
By Chip Ford


Chip Ford's CLT Commentary

Speaker Finneran's sudden case of Pol-ynesia continues to arouse incredulity among all, but like other political leaders before him felled by the convenient disease, he'll likely pull through to a full recovery when it suits him best. He's probably cured already and back on the job.

Pol-ynesia apparently struck down another victim when interviewed by MetroWest Daily News columnist Tom Moroney. "The politician wanted anonymity," he wrote and I immediately wondered if this pol could remember his or her name?

The squeeze for an income tax hike is again in the works, and this is an early indicator of the upcoming play -- a strategy set in motion last year with reduced local aid and the threat of further reductions to come.

The local reaction this past year was proposed Proposition 2½ overrides arising all around the state. Reevaluation added a bigger taxpayer burden on top of payments due for all those School Building Assistance and Community Preservation Act overrides that were approved by voters in recent years.

Now that Beacon Hill has hooked municipalities on cash, its trial balloon is being floated: Let us raise your income tax by a mere one percent (up to 6.3 percent) and all that new revenue will "absolutely, positively guaranteed, under law, to go back to the cities and towns." Reminds me of that long ago promised "temporary" income tax hike of 1989 that's still with us.

Say anything, do anything for now until you get your way; then all bets are off.

Veteran Beacon Hill observers understand that dynamic. Brian Gilmore of Associated Industries of Massachusetts, one of the lead business opponents fighting property tax reclassification, surely gets it.  "It's very hard to guarantee the future actions of the Legislature," he observed.

It's not just "very hard." It's not even conceivable.

Chip Ford


The MetroWest Daily News
Tuesday, November 18, 2003

A MetroWest Daily News editorial
Finneran's amnesia 


Here's what we know about legislative redistricting, especially here in Massachusetts: That it is by nature the most political -- and most partisan -- task a legislature undertakes.

That the maps of revised legislative districts are drawn by the majority leadership, working through trusted lieutenants and the ally named to chair the redistricting committee. That the top priority in redistricting is protecting incumbents in the majority party, particularly those most loyal to majority leadership. That nobody pays as intense attention to how the lines are drawn than the incumbent in each district, who typically knows his or her district down to the street, if not the household.

We also know that one of the only ways to get a redistricting map thrown out by a court is if it can be demonstrated that the mapmakers drew the lines in such a way as to reduce the voting power of racial minorities. Party leaders try to avoid suits like the one that prompted House Speaker Thomas Finneran's remarkable testimony last week.

Here's what we know about Finneran: He's as political a speaker as we've seen, with a well-founded reputation for using his power to expand his power. That he's among the smartest people on Beacon Hill, capable of mastering the finest legislative details. That he appointed Rep. Thomas Petrolati to chair the redistricting committee and that he assigned key allies, including Boston political operative and longtime friend Larry DiCara and Finneran's chief counsel, John Stefanini, to help out.

These facts paint the picture of a hands-on political leader taking care of business. That's why Finneran's testimony on Friday was so remarkable.

Finneran told a federal court he had no role in devising the redistricting plan adopted in 2001 and was not aware of its contents until it was submitted to the rest of the House. He didn't know which neighborhoods had been districted into or out of his district and that the new lines reduced the percentage of minority voters in his district from 74 percent to 60 percent.

The judges may have to accept Finneran's mixture of ignorance and amnesia, however incredulous, especially if they accept the speaker's attempt to deny the courts access to memos and other communication between Finneran and Petrolati as inadmissible under the dubious doctrine of "legislative privilege." It seems to us this is the public's business, being conducted on the public's dime, and the public should be able to see what elected officials are up to.

Out of court, Finneran's defenders have explained that a minority-dominated district in Boston was changed when an incumbent Democrat changed his mind about leaving office. But even if incumbent protection, not minority disenfranchisement, was the motivation, the result was the same. While the 2000 Census found that Boston's minority population had grown to more than 50 percent, the House redistricting plan created 12 majority white districts and only five majority-minority districts.

Regardless of the outcome, this case has already reinforced what we know about redistricting: It's governed by the most crass politics, with little consideration of how districts should be drawn to suit the interests of citizens instead of politicians. It should be taken out of the hands of Finneran and all other power-brokers and given to a nonpartisan commission.

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The MetroWest Daily News
Tuesday, November 18, 2003

Tom Finneran's 'senior moments'
By Peter B. Young


Here is a common problem, especially for those of us who are getting on in years: You (and I) are watching a ballgame on TV, when we suddenly feel the urge to open a suitably chilled, long-neck bottle of Sam Adams.

So we get up from the couch, march into the kitchen and stand in front of the refrigerator. But, then, as the seconds roll by, we have to ask ourselves the always-embarassing question:

Now, what did I come into this kitchen to get? 

Something like that must have hit House Speaker Tom Finneran this past Friday when he walked into the Federal courthouse in Boston named for old Joe Moakley. Mistuh Speakah was at the Moakley Courthouse to testify in a lawsuit filed by Hispanic and Afro plaintiffs in Boston challenging the redistricting that Finneran and his colleagues in the Legislature created in the wake of the 2000 Federal Census. 

To all outward appearances, Tom Finneran was in fine fettle as he entered the courthouse. But when he took the witness stand to testify, he blanked out and seemingly forgot what he had come into the courthouse to do. Even by Massachusetts standards, always so flexible, Speaker Finneran delivered an astonishing performance.

As a predictable result, Tom Finneran's testimony in this important case was literally incredible, that is to say, not credible. Veteran journalists, the three judges on the panel hearing the case, plaintiffs and just plain citizens were all amazed by the spectacle of the omnipotent King Tom Finneran drawing one blank after another as he tried and failed to answer the simplest questions. 

For example, the Associated Press story on Tom Finneran's day in court contained this thoughtful paragraph: The powerful House leader (Finneran), who has gained a reputation for tightly controlling the flow of legislation through the chamber, said he could not even testify with certainty that he represents the 12th Suffolk District, which lost a large portion of its minority population during redistricting. 

For the Boston Globe, Statehouse reporter Raphael Lewis noted simply: The statement ran counter to the reputation of Finneran, who is known on Beacon Hill as a skillful micromanager who controls the fate of even prosaic House matters. 

And in the Boston Herald, corporate parent of this newspaper, reporter Elizabeth J. Beardsley contributed this gem: Defying his reputation for micromanaging lawmakers' every move, Finneran insisted he never talked with his handpicked redistricting chief, Rep. Thomas Petrolati, about either the changes to his own district or the redistricting plan as a whole. 

If you believe Speaker Finneran's testimony, as reported by these and other capable journalists, I will be pleased to sell you the elegant new Lenny Zakim Bridge for a mere $500 down and low monthly payments of $300 for the next 10 years. Come on down! as the late Ernie Boch liked to shout. 

What is so disturbing about the Speaker's testimony, reported by the Herald under the headline Finneran forgets in court, is the way in which it feeds the dangerous fires of smoldering speculation that the state legislature of Massachusetts (aka General Court) is nothing more nor less than a criminal conspiracy for the benefit of a few favored insiders.

I try to resist that kind of corrosive cynicism. I know some of the many outstanding men and women who serve in this legislature. And I know how they must be writhing over these stories. 

This is why I reach for a medical explanation. Yes, I tell myself: The Speaker must have been going through an entire series of senior moments, all of them exploding in his head like Chinese firecrackers. And, apparently, there was nobody with him at the Moakley Courthouse to give him a friendly nudge and say: Why don't we go next door for a mug of Sam? Then you'll remember what you came here to do, you can testify about it, and then we can all go home. 

Alas, it was not to be.

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The Boston Globe
Tuesday, November 18, 2003

Compromise plan pushed to ease homeowner tax hikes
By Scott S. Greenberger, Globe Staff


A stalled plan to protect homeowners from property tax increases that could top 40 percent lurched forward on Beacon Hill yesterday, as both Governor Mitt Romney and Senate President Robert E. Travaglini endorsed a compromise forged by Mayor Thomas M. Menino and members of the city's real estate community.

House Speaker Thomas M. Finneran and business groups remain cool to the idea, but Menino said he hopes a letter signed by some of Boston's real estate heavyweights will sway Finneran, who lives in Mattapan. The proposal, which Boston filed a year ago, is bottled up in a House committee with only two days remaining in the legislative session.

"We're still waiting to hear where the speaker will be on this legislation," Menino said. "This is all about representing the people and representing the working class."

Menino's proposal would change the so-called Classification Law, a 1978 amendment to the state constitution that allows cities and towns to set different tax rates for residential and commercial property. But the residential rate cannot be less than 50 percent of what it would be if the city didn't distinguish between residential and commercial properties, and the commercial rate cannot be higher than 175 percent of what the rate would be without classification.

The problem for Boston and other cities is that residential property values are rising much faster than commercial ones. To prevent the increase in residential values from driving the actual tax bill for homeowners ever higher, cities and towns have tried to limit the damage by raising the tax rate for businesses. Now, Boston and many other cities are reaching the 175 percent limit, and Menino wants it raised to 200 percent.

Without the change in the limit, city officials say, only 57 percent of the property tax burden will fall on business owners -- as opposed to the preferred 70 percent -- and the increase for the average homeowner would be $800 next year.

Under the compromise reached between Menino and real estate leaders, the new 200 percent limit would be phased out over several years, eventually returning to the 175 percent standard. Romney described the divergence between residential and commercial values as a "temporary phenomenon" likely to disappear by then.

Menino and his aides have lobbied furiously for the bill, arguing that without it, the average Boston homeowner would be overwhelmed by the tax hike. As many as 50 other communities around the state also would benefit from the measure, which would allow cities to raise commercial tax rates beyond the current limits to deal with the rare divergence between residential property values, which are going up, and stagnant commercial values.

Statewide business groups have been fighting the proposal, saying it would burden businesses at a time when they are struggling to emerge from the economic doldrums. But Romney, a business ally, described the "anomaly" of rising residential values and falling commercial ones as a crucial issue that must be addressed before legislators adjourn for the year.

If the Legislature fails to act by the end of the year, Boston officials plan to mail out estimated yearly tax bills in January that include the tax increase. They won't force homeowners to pay the extra money, however, until later in 2004, in the hope that legislators approve the measure sometime next year.

Romney said yesterday he is "supportive of the concept which Mayor Menino and other mayors and municipal officials are pursuing.

"I want to make sure this is in every way fair to commercial real estate owners, but I'm also very concerned that this anomaly not lead to an inappropriate hike in residential tax rates," he said.

Even if Menino's proposal passes, the many commercial property owners whose properties are depreciating in value will pay less in property taxes next year than they did this year. But they will pay more than they would have without the bill. "While we're not happy with the adjustment, we recognize that there is a major problem that faces residential property owners in the city, and if a lot of small property owners were hit with a 40 percent increase, it would be devastating," said Robert L. Beal of the Beal Companies, which owns both residential and commercial properties in Boston and its suburbs.

Beal, who lives on Beacon Hill, said he supports the bill "for the climate and the good of the city of Boston" as long as the tax rate limit reverts to what it is now. But Brian Gilmore of Associated Industries of Massachusetts, the bill's primary opponent, said the group "is somewhat suspect of the provision that would have the rate return to the current position."

"It's very hard to guarantee the future actions of the Legislature," Gilmore said.

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The MetroWest Daily News
Tuesday, November 18, 2003

Small tax pain could be a gain
By Tom Moroney


The politician wanted anonymity. OK, I said. I don't mind taking the credit for his bright idea. 

It's about the shameful property taxes in this state, how high they are and how they're just getting higher and higher... and higher. 

The politician's idea is to increase the state income tax by a marginal amount. Let's say 1 percent. 

If you raised the income tax by 1 percent, he said, the state could collect an extra billion dollars a year, maybe even more. 

And that billion would be absolutely, positively guaranteed, under law, to go back to the cities and towns to be used to pay the local bills. 

For some cities and towns, he said, the state could literally send millions back. A chunk of extra cash that large, he argued, could actually result in a reduction in property taxes. 

But even if you don't believe your property taxes could go down -- who could blame you for that? -- the extra money could prevent them from going up so quickly. 

Does this bright idea have problems? Of course. 

The biggest one is that this is a tax, a direct grab at more of the money you and I earn. 

And the politicians who run this state and many of their constituents would not stand for that. 

People hate taxes. I hate taxes. 

However, there's one simple question that needs to be asked: Which tax do we hate more? 

From my perspective, no question it's the property tax. In my town, it has been estimated that the average property tax bill will go up more than $600 next year. 

It's crazy, and it looks to be happening everywhere, especially now with the property valuations so high. 

Yesterday I happened to be passing through the well-to-do town of Concord when I stopped at a small store and looked in the newsstand. On the front page of the Concord Journal was a story about how the number of property owners who were at risk for defaulting on their taxes had doubled since the year before. 

At the same time I was in Concord, Mayor Tom Menino and Gov. Mitt Romney were in Boston drumming up support for a measure that would temporarily shift some of the tax burden from the homeowner to the business owner. 

Critics say this would absolutely croak big urban centers like Worcester that need low commercial tax rates in order to attract new businesses. 

And just like Menino has his critics, I'm sure there will be plenty of opposition to this idea of raising the income tax. 

Again, the best question to ask is this: We hate all taxes. That's a given. But which tax do we hate more? Which is the more painful and unfair way to take our money from us and therefore in need of change? 

It has to be the property tax. 

Even when you are into retirement, past your earning years, the property tax just keeps on going -- and growing. 

Even when you no longer have children in the school, the property tax is there, threatening to shorten vacations and curtail all those things you want to do, now that you have time. 

The fact is, the property tax has little bearing on one's actual ability to pay or not pay. 

And because of that, cities and towns have tried innumerable gimmicks and stopgap measures to bring relief. 

One of the most popular is the idea that older citizens could hire themselves out to do menial chores around town hall. 

It sounded good on paper. But in most cases, as I am reminded by readers who have firsthand experience, the tax break amounts to an hourly rate that is less than minimum wage. In addition, the total they can earn under these plans is usually capped at $500. 

Other communities have launched foundations to bring relief, raising money and then doling it out to those in need so they can make a dent in their property taxes. 

Neither of these are bad ideas. They're just don't have a very big impact. 

The bottom line is simple. For too long we have been asking the property tax to do too much. 

We need to change the basics. The income-tax hike is just one way to do that. Another is something many cities and towns are already doing. They're charging user fees for such things as after-school sports. 

To some, a bigger state income tax and more user fees may seem intolerable. But what's the alternative? 

More foreclosures?

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Letter to the Editor
The MetroWest Daily News
Submitted on November 18, 2003
Subsequently published on November 24, 2003 as
"Legislators need to restrain spending"


In his column "Small tax pain could be a gain" (Nov. 18), Tom Moroney advocates a one percent increase in the state income tax and "the state could collect an extra billion dollars a year, maybe even more."

Then yet another political promise was made by an unnamed legislator: "And that billion would be absolutely, positively guaranteed, under law, to go back to the cities and towns to be used to pay the local bills."

Oh sure, we taxpayers are about to buy another deceptive promise like another "temporary" tax hike, or revenue being "absolutely, positively" dedicated beyond however long it takes to suck in the public again!

"The politician wanted anonymity," Moroney noted and it's easy to understand why. That pol also knows better.

"Mayor Tom Menino and Gov. Mitt Romney were in Boston drumming up support for a measure that would temporarily shift some of the tax burden from the homeowner to the business owner," Moroney reported. Another news source quotes the lead opponent, Brian Gilmore of Associated Industries of Massachusetts: "It's very hard to guarantee the future actions of the Legislature." Now there's a man who's been around and has his eyes open.

Fool me once, shame on you; fool me twice shame on me.

"To some, a bigger state income tax and more user fees may seem intolerable. But what's the alternative? More foreclosures?" Moroney concluded; a false choice.

Spending at both local and state levels has doubled in a mere dozen years, most of those during low inflation. The honest alternative is spending restraint. The only result of continued fiscal irresponsibility is never-ending tax hikes at both levels.

If you to want breed an epidemic of foreclosures, just keep raising taxes.

Chip Ford
Director of Operations
Citizens for Limited Taxation
Peabody, MA

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