CITIZENS   FOR  LIMITED  TAXATION
and the
Citizens Economic Research Foundation

CLT UPDATE
Tuesday, January 18, 2005

Tricks and treats


Playing cute, last year lawmakers slipped a dramatic change into a tax relief bill in the House. Under the plan, seniors could be exempted from paying higher taxes resulting from Prop. 2 override votes in their community. The goal was simple: Keep seniors, who tend to reject override votes - not to mention the "it's for the children appeals" - home, boosting the override's chance of success.

Romney saw through the scheme and said he'd only approve such a change if a community's voters agreed to the exemption at the ballot box. At a minimum, a similar protection must be part of any revamped proposal....

As lawmakers and Romney fashion their proposals, they should be mindful that decreasing the property tax burden on one group of residents simply shifts it to others, and many are families still paying a mortgage and education expenses, unlike seniors whose homes have been paid off, and children grown.

The "helping seniors" rhetoric is the easy part. Curbing municipal excesses, like hefty labor contracts which require persistent overrides and annual property tax increases, is far harder. But it's obvious what would help seniors, and all taxpayers, more.

A Boston Herald editorial
Monday, January 17, 2005
Ease property tax, cut local spending


House Speaker Salvatore F. DiMasi sharply criticized Governor Mitt Romney's proposal to merge the Massachusetts Turnpike Authority with the state Highway Department yesterday, saying the governor's State of the State speech lacked details and was aimed at making headlines.

DiMasi's remarks to Associated Industries of Massachusetts, a business group, signaled that Romney's recent attempts to build bridges with Democratic lawmakers may not succeed easily....

Later, in an interview, he added that Romney's education reforms could be stalled by the influential teachers unions, and that his healthcare plan "doesn't appear to be achievable."

The speaker, a Democrat, also rejected the governor's rosy portrayal of the state's fiscal condition, saying the $700 million surplus Romney cited Thursday discounts the $800 million in reserve funds the state used in the current fiscal year budget....

Former House speaker Thomas M. Finneran, DiMasi's predecessor, attended the breakfast and afterward painted a bleaker portrait of the state budget.

"Undertaking several initiatives and proposing a tax cut creates a question mark," Finneran said of Romney. "We're not out of the woods."

The Boston Globe
Saturday, January 15, 2005
DiMasi blasts Romney proposals, citing lack of details


The morning after his State of the State address, Gov. Mitt Romney's education reform plan drew criticism from the state teacher's union - and even some students.

Romney started the day meeting with teachers and students at Brighton High School, and pledged to bring teachers and administrators to the table to help him craft his reform bill....

But Massachusetts Teachers Association President Catherine A. Boudreau said the union is being left out of the loop.

"We have not met with the governor," Boudreau said. "We certainly stand ready and able to have a discussion with him."

The Boston Herald
Saturday, January 15, 2005
Teachers give F to Romney plan:
Idea lacks winning chemistry


The Lawrence schools chief wants taxpayers to fork over $490 for running boards installed on his school-supplied SUV so his wife can more easily climb aboard in high heels...

Some School Committee members are balking at the bill, though, which would be passed through to state taxpayers who pay for 99 percent of Lawrence's school budget....

Laboy had the running boards attached to his 2004 Chevrolet Trailblazer, which the city leases for him. McGovern said the vehicle was only supposed to be used for business purposes.

The Boston Herald
Saturday, January 15, 2005
School boss to taxpayers: Pimp my ride


Laboy, who had some earlier difficulties with a required English proficiency exam, has obviously now proven his mastery. But who knew his favorite English word would be "more?"

A Boston Herald editorial
Tuesday, January 18, 2005
Laboy running on empty


Schools Superintendent Wilfredo T. Laboy faced a challenge familiar to one that thousands of students in this inner-city school district face: He failed a test. Three times....

Laboy three times failed the Communications and Literacy Skill Test, an exam required of all teachers and administrators seeking a state educator license. News media carried the story from coast to coast, and even overseas....

Laboy said he wants to turn the national attention the city schools attracted because of his failures into a showcase of the schools' advances.

"The other good thing is that people all over the country have heard of Lawrence Public Schools now, so the watch is on us, and we will show them the progress Lawrence schools are making."

A CLT BLAST FROM THE PAST
The Eagle-Tribune
Wednesday, October 22, 2003
Laboy: A trying time ends with joy


Massachusetts has averted most of a threatened $583 million cut in federal funding for healthcare for the poor and uninsured, Governor Mitt Romney and Senator Edward M. Kennedy said yesterday after meeting in Washington with federal officials.

But the state will have to significantly change how it pays for its share of the Massachusetts Medicaid program and could still lose up to $200 million in federal funds in fiscal year 2006, according to Romney and his staff. In following years, the entire $583 million could be in jeopardy, they said.

Federal officials believe the state is gaming the system and getting more than its fair share of federal money for the Medicaid program.

The Boston Globe
Saturday, January 15, 2005
Mass., US reach deal on funding
Averts major cut in Medicaid match


Bipartisan cooperation isn't just about the big gestures, like that convincing show of collegiality by Gov. Mitt Romney during his State of the State address. It's also in the gritty details of governing. On that score, Romney and Democratic leaders - and ultimately taxpayers - suffered a damaging setback with their failure to reach a consensus revenue estimate for fiscal '06....

The difference isn't huge. Legislative leaders predict the state will collect some $17.1 billion. The administration's number may be as high as $17.341 billion. That may seem like chump change in a $24 billion budget, but a decade's worth of on-time, balanced budgets depended on working off the same balance sheet.

A Boston Herald editorial
Tuesday, January 18, 2005
Revenue accord an essential start


Chip Ford's CLT Commentary

As the Boston Herald editorial ("Ease property tax, cut local spending") pointed out yesterday, the trick to reducing the property tax burden is to reduce local spending.

Last year Governor Romney vetoed a cynical subterfuge by the Legislature to ease passage of more Proposition 2 overrides. The ploy was to exempt seniors from paying any increase when everyone else's tax burden was hiked. (See: "Gov. vows veto of Prop 2 assault," Feb. 26, 2004.) At that time, the State House News Service reported:

"I will veto anything which tinkers with Prop. 2," Romney said after meeting in his office with the chief sponsors of the 1980 ballot law, Barbara Anderson and Chip Ford. "What's on the table now does more than tinker. It undermines in a serious way the intent and purpose of Prop. 2 and therefore I will fight it in every way I possibly can." ...

Anderson said lawmakers are using seniors to increase the likelihood of approval of local tax overrides.... "There's something wrong here," said Anderson. "And it's obvious. It's transparent. And we're going to fight it because it's an assault on Prop. 2 and in the long run isn't going to do anyone any good, including the seniors." ...

In her column published the next day ("Tax overrides get quiet assist from House bill"), Barbara wrote:

The week of my Feb. 17 birthday, the Massachusetts House of Representatives gave me a present. It passed a bill saying that in a few years, I won't have to pay for Proposition 2 overrides anymore.

Isn't that special? Wasn't that sweet? As soon as I hit 65, I can let younger homeowners in Marblehead pay my share of the extra override taxes....

My theory about senior citizens is that many of them are fiscal conservatives because they have been around long enough to know how the game is played. They see through the doomsday scenarios and scare tactics because they have heard it all before. This is why they resist sacrificing part of their fixed incomes so teachers can get another raise on top of their annual step-increases.

And that's why it's important to encourage senior participation in override elections, instead of paying them to stay away from the polls.

As the Boston Herald editorial accurately pointed out:  "As lawmakers and Romney fashion their proposals, they should be mindful that decreasing the property tax burden on one group of residents simply shifts it to others, and many are families still paying a mortgage and education expenses, unlike seniors whose homes have been paid off, and children grown."

The solution is not to shift the burden from one group to the other -- heaven knows that generational warfare has only just begun over the future of Social Security. The solution is, "Curbing municipal excesses, like hefty labor contracts which require persistent overrides and annual property tax increases, is far harder." And we all know who most of those "hefty labor contracts" benefit.

Speaking of the teachers union, wasn't it magnanimous of its boss, Catherine Boudreau, to offer: "We have not met with the governor ... We certainly stand ready and able to have a discussion with him." This followed a Massachusetts Teachers Association news release in which she whined, "While the governor's previously released education spending plan is a good first step, it does not make up for the budget cuts that have affected students in recent years."

If the teachers union wasn't so insatiable, more of those education dollars extracted from us taxpayers would actually be spent "for the children" instead of endlessly enriching the rapacious MTA legion.

But it's only OPM (Other People's Money), as Lawrence school superintendent Wilfredo Laboy again has brazenly demonstrated. We taxpayers foot the bill for our own local education system -- and by extension MTA members' ever-escalating salaries -- but Superintendent Laboy thinks we're not doing enough for him. State taxpayers, also forced to finance 99 percent of his local school system, should keep his wife living in the luxury to which she has become accustomed.

His $164,500 yearly salary, plus his $600-a-month transportation allowance "that pays for his leased SUV, gasoline and maintenance" still isn't enough. Can this possibly be the same Wilfredo Laboy about whom on Jan. 14, 2003 Eagle-Tribune columnist Taylor Armerding wrote ("How about sharing our pain?"):

With fledgling Gov. Mitt Romney seeking authorization to cut local aid for the last half of the fiscal year in order to balance the state's books, the word from a couple of our local superintendents -- Wilfredo Laboy of Lawrence and Arthur Tate of Haverhill -- is that rather than work within those limits, they will simply shut the schools down early.

Now we know what Superintendent Laboy meant back in 2003 when, on his fourth try, he finally was able to pass the state literacy test and said, "The other good thing is that people all over the country have heard of Lawrence Public Schools now, so the watch is on us, and we will show them the progress Lawrence schools are making." The "progress" he anticipated is that next we would trick-out his truck -- "for the children" of course. That's how the education-industrial establishment always goes after anything it wants: using kids as hostages.

"But who knew his favorite English word would be 'more?'" the Boston Herald rhetorically asked in closing its editorial.

We would, because More Is Never Enough (MINE) and never will be.

Chip Ford


The Boston Herald
Monday, January 17, 2005

A Boston Herald editorial
Ease property tax, cut local spending


First, do no harm. That should be the abiding principle of lawmakers and Gov. Mitt Romney as they devise plans to ease the burden of rising property taxes on the state's seniors.

Romney has proven himself a champion of Proposition 2 in his two years in office and one little phrase in his State of the State Address underscored that he will stand in the way of any proposal to help seniors at the expense of the landmark tax limiting law and other taxpayers.

"Our parents and grandparents should be able to live their remaining years in the comforting surroundings of their homes and communities," Romney said. "Let's help them by providing property tax relief consistent with Proposition 2."

Playing cute, last year lawmakers slipped a dramatic change into a tax relief bill in the House. Under the plan, seniors could be exempted from paying higher taxes resulting from Prop. 2 override votes in their community. The goal was simple: Keep seniors, who tend to reject override votes - not to mention the "it's for the children appeals" - home, boosting the override's chance of success.

Romney saw through the scheme and said he'd only approve such a change if a community's voters agreed to the exemption at the ballot box. At a minimum, a similar protection must be part of any revamped proposal.

Other possible changes would expand eligibility for the so-called "circuit breaker" income tax break, which benefits seniors with a property tax burden (along with water and sewer bills) that is a substantial percentage of their income, by raising the maximum value of an eligible senior's property from $440,000 to $600,000. And cities and towns would be able to decrease the interest rate, now 16 percent, charged to a senior's estate who had deferred property tax payments until after their death. New property tax exemptions are also on the table.

As lawmakers and Romney fashion their proposals, they should be mindful that decreasing the property tax burden on one group of residents simply shifts it to others, and many are families still paying a mortgage and education expenses, unlike seniors whose homes have been paid off, and children grown.

The "helping seniors" rhetoric is the easy part. Curbing municipal excesses, like hefty labor contracts which require persistent overrides and annual property tax increases, is far harder. But it's obvious what would help seniors, and all taxpayers, more.

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The Boston Globe
Saturday, January 15, 2005

DiMasi blasts Romney proposals, citing lack of details
Says State of State aimed at headlines
By Benjamin Gedan, Globe Correspondent


House Speaker Salvatore F. DiMasi sharply criticized Governor Mitt Romney's proposal to merge the Massachusetts Turnpike Authority with the state Highway Department yesterday, saying the governor's State of the State speech lacked details and was aimed at making headlines.

DiMasi's remarks to Associated Industries of Massachusetts, a business group, signaled that Romney's recent attempts to build bridges with Democratic lawmakers may not succeed easily.

"If I seem a little tired this morning, I was up all night trying to find out where Mitt Romney was going to get the money to pay for all the things promised last night," DiMasi said, drawing laughter. "He'll do all these things and cut taxes, too?"

DiMasi brushed aside Romney's longstanding proposal to merge the Turnpike Authority and the Highway Department, saying the governor had provided no evidence to support his promised $20 million yearly savings from the merger.

"He is just using whatever he can to get a very good headline that sounds good but doesn't really hold up," DiMasi told the business group in a question and answer session. Later, in an interview, he added that Romney's education reforms could be stalled by the influential teachers unions, and that his healthcare plan "doesn't appear to be achievable."

The speaker, a Democrat, also rejected the governor's rosy portrayal of the state's fiscal condition, saying the $700 million surplus Romney cited Thursday discounts the $800 million in reserve funds the state used in the current fiscal year budget.

"The governor would like to think he had a surplus so he can say he's doing a great job of stimulating the economy, even though we lost 200,000 jobs since the peak year of 2001," DiMasi said.

Asked about DiMasi's comments, Romney spokeswoman Laura Nicoll said the governor expects to work closely with leading Democrats on healthcare and other policies. "He embraced the Legislature [Thursday] to join him and reach across the aisle," she said. "The governor doesn't give up easily."

In his speech Thursday, Romney, a Republican, sought to mend relations after conducting an expensive, bruising, and unsuccessful campaign to unseat Democrats in November. He praised Senate President Robert E. Travaglini and DiMasi, saying they shared a "common vision."

The governor recently hosted DiMasi for dinner at his Belmont home and joined DiMasi and Travaglini for another dinner at a North End restaurant. At the Jan. 5 ceremonies marking the opening of the new legislative session, Romney waded into the heavily Democratic crowd, shaking hands in the House chamber and at a reception afterward.

On Thursday, Romney proposed raising the pay of the best teachers, extending the school day, and funding English-language classes for adult immigrants.

He again touted a healthcare proposal to broadly expand coverage without raising state spending or imposing a mandate on employers.

DiMasi did offer some conciliatory words, quoting the governor favorably at least three times in answering questions from among 300 business leaders.

He agreed with Romney that improving public education did not require further large expenditures, said he would consider lengthening the school day, and echoed Romney's belief that drawing companies to Massachusetts required more affordable housing, not high state subsidies.

DiMasi also expressed support for expanding health coverage, but he was skeptical of the state's ability to fund Romney's healthcare plan, among other initiatives.

The state has spent more than $3 billion in reserves in the last four years, and cut many programs. But despite a marked recovery, state revenue has not returned to 2001 levels, DiMasi said.

Former House speaker Thomas M. Finneran, DiMasi's predecessor, attended the breakfast and afterward painted a bleaker portrait of the state budget.

"Undertaking several initiatives and proposing a tax cut creates a question mark," Finneran said of Romney. "We're not out of the woods."

Martin Linsky, a lecturer at the John F. Kennedy School of Government at Harvard University and a former House minority leader, said DiMasi's remarks were neither hostile nor personal, and did not rule out possible compromise.

But Linsky said DiMasi's tone might forecast lingering rocky relations with some lawmakers.

"It's not only Romney's ambitions, but his style in the first [part of his] term was to use the Legislature as a whipping boy, not to create collegial relationships," Linsky said.

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The Boston Herald
Saturday, January 15, 2005

Teachers give F to Romney plan:
Idea lacks winning chemistry
By Kimberly Atkins


The morning after his State of the State address, Gov. Mitt Romney's education reform plan drew criticism from the state teacher's union - and even some students.

Romney started the day meeting with teachers and students at Brighton High School, and pledged to bring teachers and administrators to the table to help him craft his reform bill.

"I came here (to) ask faculty members, and administration, and students what kinds of things they think we should do to make their education experience better," said Romney, whose plan includes a science MCAS exam, longer school days and teacher merit pay.

But Massachusetts Teachers Association President Catherine A. Boudreau said the union is being left out of the loop.

"We have not met with the governor," Boudreau said. "We certainly stand ready and able to have a discussion with him."

Not everyone at Brighton High was excited about Romney's plan. When he asked several Adams Scholarship recipients - who got the awards for high math and English MCAS scores - if science should be added, all but one replied "No."

The governor didn't get teachers' thoughts on the science MCAS idea at all. "I didn't bring it up with the faculty members," Romney told reporters.

Romney pledged to implement reforms while keeping a structurally balanced budget, but said the funding details are still being worked out.

"A major source is to use the money we spend more effectively," Romney said.

But Boudreau said the current budget barely has enough to meet current needs.

"You can't increase requirements or make mandates and say you are not going to support those mandates with resources. We do not have enough resources as it is," she said.

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The Boston Herald
Saturday, January 15, 2005

School boss to taxpayers: Pimp my ride
By Kevin Rothstein


The Lawrence schools chief wants taxpayers to fork over $490 for running boards installed on his school-supplied SUV so his wife can more easily climb aboard in high heels.

"Members of my family, particularly the females when they're dressed or they're in heels, it's very hard for them to step up," Superintendent Wilfredo Laboy told The Eagle-Tribune.

Some School Committee members are balking at the bill, though, which would be passed through to state taxpayers who pay for 99 percent of Lawrence's school budget.

"We should be grateful we're receiving this money from the state and we need to spend it the best way we can," said board member Amy McGovern.

Laboy had the running boards attached to his 2004 Chevrolet Trailblazer, which the city leases for him. McGovern said the vehicle was only supposed to be used for business purposes.

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The Boston Herald
Tuesday, January 18, 2005

A Boston Herald editorial
Laboy running on empty


Lawrence School Superintendent Wilfredo Laboy gives new meaning to word chutzpah. The head of one of the state's poorest school districts gets (in addition to his $164,500 yearly salary) a $600-a-month transportation allowance that pays for his leased SUV, gasoline and maintenance.

Now, however, Laboy has submitted a bill for an additional $490 to pay for running boards for the Chevy Trailblazer, insisting his wife has trouble getting into the car when wearing high heels. School Committee members are outraged, but so should state taxpayers who foot 99 percent of Lawrence's school budget.

Laboy, who had some earlier difficulties with a required English proficiency exam, has obviously now proven his mastery. But who knew his favorite English word would be "more?"

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-- A CLT BLAST FROM THE PAST --

The Eagle-Tribune
Wednesday, October 22, 2003

Laboy: A trying time ends with joy 
By Shawn Boburg, Staff Writer 

LAWRENCE -- Schools Superintendent Wilfredo T. Laboy faced a challenge familiar to one that thousands of students in this inner-city school district face: He failed a test. Three times.

But a fourth chance and some study time were all Laboy needed to pass his own high-stakes exam, and he wants Lawrence students -- who show some of the lowest standardized test scores in the state -- to follow his example.

"This has absolutely made me stronger," he said yesterday, a day after learning he passed a state-required literacy test. "This makes me an example to all the kids in the district who have trouble with another test called MCAS," which high school students must pass to earn a diploma. 

"It tells them, 'You can do it.' It tells them it's not all about being smart. It's about enduring and working hard," he said. "I'm a living example to them of what endurance is. If you ever want to have endurance you have to have trials."

Speaking publicly about his testing struggle for the first time since his earlier failures were revealed in news reports in August, Laboy reflected on what he said was a difficult period and thanked those who supported him through the controversy.

Laboy three times failed the Communications and Literacy Skill Test, an exam required of all teachers and administrators seeking a state educator license. News media carried the story from coast to coast, and even overseas.

"This was a very trying time for my family," he said. "Not just here, but all over the country. Last night was joyous for them, though. I got calls from aunts and uncles and cousins from all over. My older brother was moved to the point where he couldn't talk because he believed that I had been unfairly labeled through all of this." 

The past two months have also been an emotional time for Laboy, who was criticized by some School Committee members for not telling them about his past failures.

"Yes, maybe I wasn't a stand-up guy when it came to communication, but this was about pain, brokenness and failure," he said. "It's not always easy to stand up and say I, Wilfredo Laboy, failed.

"I still think I have the trust of this community. I still think the Lawrence School Committee thinks I'm doing a good job, and the day they don't, they have every right to ask me to leave."

In August, shortly after the controversy erupted, the School Committee took a 6-1 "vote of confidence" for Laboy.

"I am thankful for the unconditional support I have gotten," he said. "I received several letters of support from people in surrounding communities. I also received many letters from people telling me to learn English or go back to my own country."

Laboy said he was humbled by a call from Lt. Gov. Kerry Healey who had this message yesterday: "Yahoo!" Laboy also said she expressed support for him and the job he has done to improve Lawrence schools. 

It's that job which Laboy now hopes people can focus on.

"We have a high school to get accredited, a new high school to build, test scores to improve," Laboy said. "We want to make winners out of everybody."

Laboy said he wants to turn the national attention the city schools attracted because of his failures into a showcase of the schools' advances.

"The other good thing is that people all over the country have heard of Lawrence Public Schools now, so the watch is on us, and we will show them the progress Lawrence schools are making."

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The Boston Globe
Saturday, January 15, 2005

Mass., US reach deal on funding
Averts major cut in Medicaid match
By Alice Dembner and Rick Klein, Globe Staff


WASHINGTON -- Massachusetts has averted most of a threatened $583 million cut in federal funding for healthcare for the poor and uninsured, Governor Mitt Romney and Senator Edward M. Kennedy said yesterday after meeting in Washington with federal officials.

But the state will have to significantly change how it pays for its share of the Massachusetts Medicaid program and could still lose up to $200 million in federal funds in fiscal year 2006, according to Romney and his staff. In following years, the entire $583 million could be in jeopardy, they said.

Federal officials believe the state is gaming the system and getting more than its fair share of federal money for the Medicaid program. The rules require Massachusetts and the federal government to share the program's costs equally.

"We have to make changes to qualify for those funds," Romney said, after meeting with Tommy Thompson, secretary of the US Department of Health and Human Services, and Dr. Mark McClellan, administrator of the Centers for Medicare & Medicaid Services. "We won't be able to qualify for every dollar."

Loss of the full $583 million, which represents nearly 9 percent of the Massachusetts Medicaid program, would have added to the state's budget gap and might have forced cuts in services or eligibility for Medicaid, a program that serves the poor and disabled.

Most of the money goes to Boston Medical Center and Cambridge Health Alliance and their affiliated managed health plans that treat many patients covered by Medicaid or without insurance. A portion also supports other hospitals, community health centers and publicly owned nursing homes, and subsidizes the state's fund to cover hospital care for the uninsured. Health advocates and hospital officials said loss of the full amount could have affected the care of at least 230,000 people.

"It appears that they made great progress," said Elaine Ullian, chief executive of BMC, who added that she was waiting to hear the financial details. The money, she added, "is absolutely critical for all the uninsured and underinsured people in the state and the hospitals and health centers that take care of them."

The nearly $400 million that is now guaranteed for the next fiscal year comes to the state through a waiver of Medicaid rules that allows the state to treat patients in managed-care programs, to give extra money to the two hospitals' managed-care plans and to serve 250,000 people who would not otherwise qualify. The waiver, first approved in 1996, was set to expire in June, but will now be extended for another three years. However, the financing in future years will depend on whether the state meets new rules that are still being worked out.

"We have granted a three-year extension that allows them to continue to operate the program," said Mary Kahn, a spokeswoman for Medicaid. "The state will continue to receive matching dollars, but how the state comes up with its share of the money is in question." US officials declined to discuss financial details until an agreement is written and signed next week.

The agreement resulted from months of negotiations that concluded with a nearly two-hour session yesterday. Federal officials had challenged how Massachusetts and other states raise their share of Medicaid costs. Under federal rules, Massachusetts must pay 50 percent of the cost of its nearly $7 billion program, called MassHealth. Administration officials say many states are abusing the matching program, seeking loans from private hospitals or municipal agencies to inflate the match, but then returning the loaned money without spending it on Medicaid.

In Massachusetts, the nearly $600 million in matching money has come from the Boston and Cambridge public health commissions, which own the health plans affiliated with BMC and the Cambridge Health Alliance, and from UMass Memorial Health Care in Worcester and several other public agencies. In the complicated arrangement that federal officials are continuing to question, the hospitals get back their contribution, plus a nearly equal amount in federal funding.

State officials, backed by Kennedy, argued that the match was appropriate and that the money had been used properly for the uninsured. They said the waiver had saved the federal government $1.8 million over eight years, compared with what it would have cost under normal Medicaid rules without managed care.

Now, however, Kennedy said, "The administration wants similar kinds of accounting for all of the country. We were able to avoid the harsher kind of remedies," he said, but the Legislature, healthcare providers, and the Romney administration are going to have to make significant changes.

Dennis D. Keefe, chief executive of the Cambridge Health Alliance, reacted cautiously to the news. "Until we see all of the details, it's kind of difficult for us to characterize whether it's good or bad," he said.

Romney said the agreement was essential to his administration's proposal to try to expand health coverage to the 450,000 to 600,000 Massachusetts residents without insurance.

"I'm feeling much better than I did a year ago, but I'm not going to celebrate in the streets," Romney said. Members of his administration plan to discuss the details with healthcare providers and others early next week.

Yesterday, federal officials alluded to the financial reasons behind their challenge to the old funding arrangements. The Bush administration has been trying to restrain rapidly increasing spending in the $263 billion Medicaid program nationwide.

"Finding new and innovative ways to manage Medicaid costs and expand coverage is a win-win situation for the whole community," McClellan said.

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The Boston Herald
Tuesday, January 18, 2005

A Boston Herald editorial
Revenue accord an essential start


Bipartisan cooperation isn't just about the big gestures, like that convincing show of collegiality by Gov. Mitt Romney during his State of the State address. It's also in the gritty details of governing. On that score, Romney and Democratic leaders - and ultimately taxpayers - suffered a damaging setback with their failure to reach a consensus revenue estimate for fiscal '06.

This isn't the stuff of which headlines are made, but an agreement between the executive branch and the House and Senate on how much revenue the state will have to fund its operations was one of the most important fiscal reforms of the 1990s. Its adoption marked the end of an era of budget gamesmanship, and was a foundation of the state's fiscal recovery.

But House and Senate budget leaders announced Saturday there would be no agreement for the next fiscal year. Even worse, the more fiscally conservative Romney administration balked because the Legislature was being too "pessimistic" about how much cash the state would take in. Since when is it a bad thing when lawmakers think they have less to spend?

The difference isn't huge. Legislative leaders predict the state will collect some $17.1 billion. The administration's number may be as high as $17.341 billion. That may seem like chump change in a $24 billion budget, but a decade's worth of on-time, balanced budgets depended on working off the same balance sheet.

Romney and Sen. Ted Kennedy pulled a fiscal rabbit out of the hat last week by convincing the Bush administration to extend the state's Medicaid waiver, avoiding a $600 million revenue hit at least for a year.

That kind of productive bipartisanship is as necessary on Beacon Hill as it was in Washington, D.C., not just when the chips are down, but even now that the state's fortunes are turning. Fiscal discipline mustn't be the first casualty of a brighter revenue picture.

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