CITIZENS   FOR  LIMITED  TAXATION
and the
Citizens Economic Research Foundation

CLT UPDATE
Tuesday, August 31, 2004

Government still happens
during the dog days of summer


You can probably hear the flags flapping outside Boston's new convention center, which hosted just a single meeting in all of August in its aircraft-carrier-sized hall.

However, two of the banners stirring in the breeze might cause a double-take - the official flag of the Massachusetts Convention Center Authority.

Taking on the trappings usually associated with sovereign nations, the state convention authority, which oversees the newly opened $800-million-plus meeting hall, has unfurled its own flag.

Two MCCA flags now fly outside the convention hall off Summer Street in South Boston - at an estimated cost of thousands to state taxpayers.

The flag carries the state authority's new logo, rolled out earlier this year at a cost of $10,000....

The convention authority's spending on flags and logos, even as space in its new hall goes begging, drew a scornful response from taxpayer advocate Barbara Anderson. The hall, after a years-long, multimillion-dollar marketing campaign, has 61 bookings for its first decade.

"I think it should declare itself an independent country and go looking for federal aid," Anderson said.

The Boston Herald
Wednesday, August 25, 2004
Pricey banners wave as business flags


A cast of Hollywood stars may soon swarm Beacon Hill to charm rumpled state lawmakers while touting public subsidies for the movie industry.

The big-name actors with local roots are ready to lobby for tax "incentives" for major movie companies that shoot their productions in the Bay State, film industry supporters say....

But some critics, like taxpayer advocate Barbara Anderson, are unimpressed.

"I think there is a word for it, isn't there? Extortion," said Anderson, head of Citizens for Limited Taxation.

The Boston Herald
Saturday, August 28, 2004
Stars looking for lucky break:
Hollywood begging for tax incentives


Massachusetts cut deeper into its government workforce than any other state during the recent economic downturn, shedding teachers, police officers, social workers, environmental regulators, and thousands of other local and state employees....

But Noah Berger of the Massachusetts Budget and Policy Center, a liberal advocacy group, said the Bay State had to cut its public payroll so deeply because it cut taxes so aggressively during the 1990s economic boom.

"Ultimately, our state became a national leader in cutting public services like education because during the economic boom we were a national leader in cutting taxes," Berger said....

Shawn Feddeman, a spokeswoman for Romney, pointed out that the agencies directly under the governor's control have been cut even more severely than other areas of state government....

"In the past, state government has grown without rhyme or reason," Feddeman said. "Sometimes it takes a fiscal crisis to focus attention on workforce reductions."

The Boston Globe
Saturday, August 28, 2004
Mass. led states in government job cuts 
Economic downturn saw workforce fall 3.1 percent


Groups such as the Mass. Teachers Association, Mass. 2020 and the Federation for Children With Special Needs - 40 groups in all - filed briefs with the Supreme Judicial Court, urging it to follow the recommendations of Judge Margot Botsford, who told the SJC in April that the state is unconstitutionally underfunding education for children from lower income communities....

The state had argued that it had done an enormous amount - billions in new spending, the MCAS, and massive changes in school management and accountability - to meet the dictates of the 1993 McDuffy case that first established the unconstitutionality of Massachusetts' educational funding policy. Botsford acknowledged the effort, but found it wasn't enough, and the briefs filed this week urge the SJC to act on that finding.

State House News Service
Weekly Roundup - Week of Aug. 23, 2004


There was no word as last week ended as to when a final budget will move out of the House Ways and Means Committee or when or if the House and Senate will take a position of how to use a huge year-ending surplus that exceeded $700 million.

State House News Service
Advances - Week of Aug. 30, 2004


Chip Ford's CLT Commentary

As you know from Barbara's most recent column, I'm back from my sailing cruise up the coast of Maine. With Labor Day Weekend on the horizon, it's back to politics as usual.

There hasn't been a whole lot of state news since the Democrats' party concluded in Boston at the end of July, when our Legislature hung its "closed for business" sign on the State House door and went home for the summer -- and fall -- until they resume "formal" sessions in January. August was a good month to put out to sea.

Summer is always a good time for studies and analyses to be released and for reporters to dig into and uncover otherwise perhaps obscure stories. The taxpayer cost for silly new flags for the white elephant Boston Convention Center is one of those. $10,000 for just the logo, $4,000-$6,000 for each flag pole, and $400 per flag -- but what the heck since we've already forked over $800-million-plus in foreign aide to the sovereign nation of the Massachusetts Convention Center Authority. It's only more money, right?

Aren't we about due for a new state slogan? That's always good every couple years for another few hundred thousand in wasted taxpayers' money too. And after all, the Legislature is now sitting on a revenue surplus of over $700 million from last year, trying to decide what to do with it before too many of us are back to paying attention.

Which brings me to "Whatever happened to our tax rollback?" Barbara updates its status further below.

Another report being quietly touted by the tax-and-spend crowd indicates "Overall, the state shed 3.1 percent of its public workforce, reducing it from 376,200 to 364,500 jobs. Massachusetts was one of only five states that cut its government payroll as it grappled with the economic slump." Noah Berger of the Massachusetts Budget and Policy Center -- formerly known as TEAM (Tax Everything and More) before its makeover -- blames it on tax cuts, of course.

The primary problem with the public sector in Massachusetts hasn't been the number of employees, but rather the power of the public employees unions and the equally intimidating power of political patronage, the no-show and make-work jobs for wired cronies. As the governor's spokeswoman pointed out, "In the past, state government has grown without rhyme or reason. Sometimes it takes a fiscal crisis to focus attention on workforce reductions."

The teachers union is back from vacation -- or never left on one -- again demanding that More Is Never Enough. "For the Children" of course. Despite the increased billions upon billions of taxpayer dollars spent on education over the last decade, the Massachusetts Teachers Association and others are lobbying the state Supreme Judicial Court for billions and billions more. Are we about to be handed down another judicial decree from the high bench in October, witness another end-run around the legislative process, another radical law imposed by judicial fiat?

While we wait to find out, prepare for the onslaught of Hollywood multi-millionaires scaling Beacon Hill with their hands out reaching into our pockets for a special interest tax break. They need "tax relief" don't you know to make those box office hits that gross hundreds of millions. It's not easy being a matinee idol these days without taxpayer subsidies.

Summer is almost over, vacations are behind us, but politics as usual never strays far from home.

Chip Ford

 


Update on Income Tax Rollback
By Barbara Anderson

As you know, our successful ballot question mandated that the income tax rate would be 5 percent in 2003; instead it was frozen at 5.3 percent where it remains. A legislative formula drops it to 5 percent in 2014.

This past spring, between the passage of the House version of the FY’05 budget and the Senate debate on its own version, Governor Romney proposed dropping the rate to 5 percent for 2005. He and CLT asked Senate Republicans to try to amend the Senate budget on the floor to include the rollback. Senator Lees refused, stating at the time that it would be better done in the coming supplemental budget.

There is a supplemental/deficiency budget at the end of each fiscal year to pay bills and to deal with a budget surplus. The surplus for FY’04, which ended June 30, 2004, exceeded $500 million. Before the Legislature left for the summer-fall, the governor filed his version of this budget with the income tax rollback language included.

The Legislature will not be meeting again in formal session; it left for the summer without taking up this budget, which is sitting in House Ways & Means Committee. When it emerges, it will not have the rollback language in it, and wouldn’t do us any good if it did, because the budget can pass only if there is no objection from any legislator to doing it in an informal session. We expect that only minor, non-controversial items will quietly pass.

We had asked Republican allies to refuse to pass the budget -– that is, to object to doing it in an informal session –- unless it contains the rollback language. We do not expect that this will happen, since Republicans want items that the budget contains.

Therefore, we expect that the next time we will see the rollback language will be in the FY’06 budget that Governor Romney will file in January 2005, with expenditures reflecting the 5 percent rate.


The Boston Herald
Wednesday, August 25, 2004

Pricey banners wave as business flags
By Scott Van Voorhis


You can probably hear the flags flapping outside Boston's new convention center, which hosted just a single meeting in all of August in its aircraft-carrier-sized hall.

However, two of the banners stirring in the breeze might cause a double-take - the official flag of the Massachusetts Convention Center Authority.

Taking on the trappings usually associated with sovereign nations, the state convention authority, which oversees the newly opened $800-million-plus meeting hall, has unfurled its own flag.

Two MCCA flags now fly outside the convention hall off Summer Street in South Boston - at an estimated cost of thousands to state taxpayers.

The flag carries the state authority's new logo, rolled out earlier this year at a cost of $10,000.

The convention authority's spending on flags and logos, even as space in its new hall goes begging, drew a scornful response from taxpayer advocate Barbara Anderson. The hall, after a years-long, multimillion-dollar marketing campaign, has 61 bookings for its first decade.

"I think it should declare itself an independent country and go looking for federal aid," Anderson said.

But a convention authority spokeswoman defended both the flags and the logo.

The authority's flag can be traced to the original design of the massive hall, which called for a cluster of flags - including the state and American flag, outside the hall's entrance, according to spokeswoman Bridget Perry. And the logo plays a role in marketing and branding efforts aimed at filling the hall with paying customers, Perry said.

Still, the flags, like the logo, may not have come cheap.

The flags cost $400 each, said Perry, who was unable to provide an estimate of the costs of the poles. Similar poles used by the Massachusetts Port Authority - which also has its own flag - cost $4,000 to $6,000 each, a spokeswoman said.

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The Boston Herald
Saturday, August 28, 2004

Stars looking for lucky break:
Hollywood begging for tax incentives
By Scott Van Voorhis


A cast of Hollywood stars may soon swarm Beacon Hill to charm rumpled state lawmakers while touting public subsidies for the movie industry.

The big-name actors with local roots are ready to lobby for tax "incentives" for major movie companies that shoot their productions in the Bay State, film industry supporters say.

Cambridge shooting star Ben Affleck and his pal, "Bourne Supremacy" idol Matt Damon; HBO's "Entourage" producer Mark Wahlberg, of Dorchester, and fellow Dot guy Neal McDonough of TV's "Medical Investigation;" and deadly serious thespian Chris Cooper, currently residing in the Hub's suburbs: they're all ready to make the tax relief pitch, according to state film industry cheerleader Robin Dawson and another movie maven working on the project.

In fact, some of the big stars have signaled their readiness for local politicking - even if it means sitting down for chats with Bay State politicos and testifying at dreary State House hearings, says Dawson, head of the Massachusetts Film Bureau.

The star support comes as local entertainment industry boosters and their allies on Beacon Hill prepare to unleash a campaign to make Massachusetts more Tinseltown friendly.

But some critics, like taxpayer advocate Barbara Anderson, are unimpressed.

"I think there is a word for it, isn't there? Extortion," said Anderson, head of Citizens for Limited Taxation.

Film hungry locales like New Mexico are offering everything from massive tax breaks to millions in no interest loans to Hollywood moguls, noted Carol Patton, publisher of Imagine Magazine, who promises to produce Wahlberg and other celebrities to back up an upcoming proposal by state Rep. Brian Wallace (D-South Boston).

"It's a question of dollars and cents," argued Wallace - a novelist with two books optioned by filmmakers. "I don't think it's a question of trying to help fat cats get fatter," he said.

Wallace is preparing a legislation "package" that may include millions in rebates for movie companies that spend big locally.

Meanwhile, some of the movies' biggest stars may soon appear in local theaters asking you to open your wallet or purse.

Affleck, Damon, Cooper, and Hollywood legend Clint Eastwood recently taped a short trailer that Dawson's Massachusetts Film Bureau hopes to run in local theaters. The big guns tout the joys of filming in Massachusetts.

They argue that state taxpayers should pony up for Dawson's Massachusetts Film Bureau. At the segment's end, Cooper offers up a general statement of support for tax incentives for movies that are shot locally.

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The Boston Globe
Saturday, August 28, 2004

Mass. led states in government job cuts 
Economic downturn saw workforce fall 3.1 percent
By Scott S. Greenberger, Globe Staff


Massachusetts cut deeper into its government workforce than any other state during the recent economic downturn, shedding teachers, police officers, social workers, environmental regulators, and thousands of other local and state employees.

As tax revenue dried up between 2001 and 2003, Massachusetts cut its state payroll by 5 percent, according to statistics compiled by the US Department of Labor. Some of those workers were laid off, while others took early retirement. Meanwhile, cities and towns eliminated about 2 percent of their government jobs, as Beacon Hill reduced state aid to communities across Massachusetts.

Overall, the state shed 3.1 percent of its public workforce, reducing it from 376,200 to 364,500 jobs. Massachusetts was one of only five states that cut its government payroll as it grappled with the economic slump. So far, the federal numbers for 2004 show that Massachusetts cities and towns are hiring again, but the number of state workers has continued to drop.

Many state residents have pointed out, and lamented, the loss of police officers, firefighters, and teachers at the municipal level. A May 2004 report by the Senate Committee on Post Audit and Oversight, based on a survey of police and fire chiefs, found that cities and towns had lost 945 police officers and 798 firefighters since Sept. 11, 2001.

Reductions in the state workforce also have had a significant impact, according to budget experts and advocates.

"The glib assertion about administrative cuts being harmless belies the larger truth: Clearly, there were cuts in programs and services with people leaving state employment," said Michael J. Widmer of the Massachusetts Taxpayers Foundation. "The assumption is that people can go and the programs stay, but people manage the programs."

Certain areas and agencies lost far more workers than others. For example, the Department of Social Services, which is charged with the care and protection of children, lost about 8 percent of its workforce. The personnel losses were even more extensive at the Department of Environmental Protection, where the workforce declined from 1,215 in 2001 to roughly 930 at the end of 2003, a decrease of almost 24 percent.

Jim Gomes, president of the Environmental League of Massachusetts, said he and other environmental advocates have noticed the difference.

"People who advocate for the environment on Beacon Hill have been aware for several years that agencies people rely on to inspect pollution sources, enforce the law against violators, and maintain our parks and beaches have all been suffering deeper than average cuts over the past few years," Gomes said. "You really can't be a state that does first-class environmental protection on the cheap."

David Holway of the National Association of Government Employees said the largest state employees' union has shrunk from about 16,000 members before the fiscal crisis to about 14,000 now. The union represents mid-level managers and highway workers.

"You drive down the state highways in Massachusetts -- they're a national disgrace," Holway said. "The grass isn't mowed, the sides of the road are filthy because there is nobody to do these jobs. If I were Governor Romney, I'd be embarrassed."

Massachusetts cut about $3 billion from the roughly $24 billion state budget as it tried to navigate the economic downturn. Representative Peter J. Larkin, one of House Speaker Thomas M. Finneran's top lieutenants, said Beacon Hill had to trim personnel costs to balance the books. After the Legislature approved a $1.2 billion tax hike at the beginning of the crisis, further tax increases were off the table, Larkin said.

"I don't think we were fat in terms of employment," he said. "We had no choice, and frankly we haven't turned the corner."

But Noah Berger of the Massachusetts Budget and Policy Center, a liberal advocacy group, said the Bay State had to cut its public payroll so deeply because it cut taxes so aggressively during the 1990s economic boom.

"Ultimately, our state became a national leader in cutting public services like education because during the economic boom we were a national leader in cutting taxes," Berger said.

Massachusetts may have a liberal, big-government reputation, but it didn't have a bloated bureaucracy when it began cutting its public payroll: The Bay State had a state worker for every 58 people in 2001, compared to the national average of 50. On the state and local levels combined, there was a public employee for every 17 people in Massachusetts, compared to one for every 15 people nationally.

Shawn Feddeman, a spokeswoman for Romney, pointed out that the agencies directly under the governor's control have been cut even more severely than other areas of state government. Executive agencies had 46,579 employees at the beginning of 2001, compared to 41,287 at the end of 2003, a reduction of about 11 percent. But Feddeman said Romney, who took office in January 2003, believes there are enough workers to fulfill the state's responsibilities.

"In the past, state government has grown without rhyme or reason," Feddeman said. "Sometimes it takes a fiscal crisis to focus attention on workforce reductions."

Globe correspondent Elise Castelli contributed to this report.

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State House News Service
[Excerpt] Weekly Roundup - Week of Aug. 23, 2004
By Craig Sandler


With summer drawing to a close, Back-To-School week seemed to arrive on the Hill - and as always, the top subject was math.

The biggest and most important numbers were associated with education. Members of the Board of Education and Department of Education said they doubted they'd be able to start the history and science components of MCAS testing without more money, presumably via a supplemental budget. But that problem - perhaps $3 million - is paltry compared to the implications of a lawsuit on which leading state education groups weighed in Thursday.

Groups such as the Mass. Teachers Association, Mass. 2020 and the Federation for Children With Special Needs - 40 groups in all - filed briefs with the Supreme Judicial Court, urging it to follow the recommendations of Judge Margot Botsford, who told the SJC in April that the state is unconstitutionally underfunding education for children from lower income communities. The judge said a cost study should be performed to derive a new funding formula that would establish the same quality public education in Brockton or Lawrence as in Wellesley or Hingham.

The state had argued that it had done an enormous amount - billions in new spending, the MCAS, and massive changes in school management and accountability - to meet the dictates of the 1993 McDuffy case that first established the unconstitutionality of Massachusetts' educational funding policy. Botsford acknowledged the effort, but found it wasn't enough, and the briefs filed this week urge the SJC to act on that finding.

In July, Attorney General Reilly said a court order for a massive new funding and policy effort would only be warranted if the state had not tried so hard or if no improvement had been shown in student performance. But Reilly, on behalf of the state, argued that both effort and results have been forthcoming.

A subset of numbers most notable to the State House set: 13 and 34, the number of senators and representatives respectively who signed their names to one of the amicus briefs filed Thursday. It is members of the Senate and House who ultimately will have to deal with the rule-setting, appropriation-making and yes, revenue-raising implied in any effort to make the next major step towards educational equality. The SJC is due to consider Botsford's recommendations, and the underlying Hancock v. Board of Ed lawsuit, this October.

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State House News Service
[Excerpt] Advances - Week of Aug. 30, 2004


Gov. Mitt Romney leads a troop of Bay State Republicans to the Big Apple this week while Democratic lawmakers back in Boston face a deadline for acting on a final budget to close the books on the last fiscal year. Fiscal 2004 ended on June 30 leaving red ink in some accounts and the state comptroller needs an appropriation in place to pay those bills before Sept. 15.

There was no word as last week ended as to when a final budget will move out of the House Ways and Means Committee or when or if the House and Senate will take a position of how to use a huge year-ending surplus that exceeded $700 million.

This week will bring news about the pace of revenue collections in August, the second month of this new fiscal 2005 year, and an early indication as to whether state coffers can be expected to overflow for another year.

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