CITIZENS   FOR  LIMITED  TAXATION
and the
Citizens Economic Research Foundation

CLT UPDATE
Saturday, October 7, 2006

"A government position is not a license to steal"


Beware those - and we include gubernatorial candidates Deval Patrick and Christy Mihos among them - who worship at the altar of "local aid." ...

Few of those working for even the largest, most generous corporations are guaranteed 80 percent of their salary upon retirement, can buy back their unused sick days when they leave, or pay only 10 percent of the cost of their health insurance. But communities throughout the commonwealth count these expensive benefits among the "fixed costs" to which they are obligated.

Patrick, Mihos and others talk about how they won't sign onto the voter-mandated income tax rollback for fear of reducing the amount of assistance to cities and towns. But the intelligent voter ought to ask how much of any additional money they provide will go to increasing services and how much will go to pay more employees higher salaries and provide them with even better benefits than they currently receive.

The Salem News
Thursday, October 5, 2006
A Salem News editorial
Local aid benefits some more than others


Contracts are regularly negotiated with unions that represent government employees, including teachers. The net effect of this process has been cushy retirement programs (always identified with government work), and a wage/fringe benefit structure that now outdistances the private sector. This feeding at the trough must stop. Identify those legislators who play footsies with the unions so that you can pay higher taxes - and vote them out.

The Salem News
Saturday, September 16, 2006
Election '06:
Learn and think about what candidates for office are saying

By Robert Kelly


They aren't there to serve the public. We, the public, are there to serve them. The pension system is just one more piggy bank to raid at their pleasure, and our expense, in order to do favors for themselves and their friends.

The Salem News
Wednesday, August 2, 2006
Legislators should have this much 'compassion'
for those who pay the bills

By Taylor Armerding


Apart from the question about their qualifications for work in the highly competitive private sector, they would be lucky to do better if and when they did find a job. That's because the general belief that government work doesn't pay well is a myth. Consider some of Cato's findings:

* The average compensation package for federal workers in 2005 was twice the average for private sector earners.

* The benefit portion of wages in 2005 was worth 50 percent of average federal compensation; the private sector benefit package was worth 18 percent of average compensation. Obviously few, if any, federal employees work without a full plate of fringes, while many private-sector employees do.

* Federal compensation without fringes was 62 percent higher than that for the average private-sector worker in 2005.

* Since 1990, average federal pay has increased 129 percent - as opposed to 74 percent in the private sector. Over the past five years, federal pay has gone up 38 percent - as opposed to 14 percent in the private sector.

* The rate of layoffs in the federal work force is one-quarter the rate in the private sector.

The Salem News
Wednesday, September 13, 2006
Your taxes at work
By Robert Kelly


In a stinging setback for Governor Mitt Romney, the Massachusetts Port Authority board of directors yesterday refused to reduce its sick-pay policy, retaining a benefit that is the most generous in state government and has provided retiring employees with payouts of as much as $201,000.

The Boston Globe
Saturday, September 30, 2006
Massport refuses to relent on sick pay
Romney is rebuffed as directors delay action


Years ago it was reasoned that certain state agencies should be established as independent fiefdoms that operate outside of the corruptive influence of the political system.

Seemed like a good idea. It has been tried -- and it has failed....

These revelations come on the heels of recent columns that have appeared in the Salem News about approved and undeserved pension payments, and about the increasingly lush wage/fringe packages that are now typical in the government sector. And memory is hardly tested to remember the comments of Mayor Bonfanti, Peabody, about the lush health insurance package that he is, by contract, bound to finance year after year.

A gubernatorial race is underway. Candidates are looking for a good issue. Here it is.

Appoint a commission. The objective? To examine wage/fringe practices across the board, including those that apply to legislators, their pensions, and the qualifications for pension.

The mission? To adjust those policies to conform to private sector practices and to restrict year-to-year changes to the degree that they are made in the private sector.

Enough! A government position is not a license to steal.

The Salem News
Saturday, September 30, 2006
Government wages, benefits should reflect
those that prevail in private industry

By Robert Kelly


Revenue Commissioner Alan LeBovidge today announced that preliminary revenue collections for September were $2.070 billion, an increase of $129 million or 6.6 percent over last September. September collections passed the $2 billion mark for the first time.

Total tax collections for the third month of fiscal 2007 were $31 million above the September benchmark. Year-to-date collections were $4.505 billion, an increase of $170 million or 3.9 percent....

Income tax collections for September totaled $1.133 billion, an increase of $107 million or 10.4 percent over last September. Withholding tax collections totaled $702 million, an increase of $76 million or 12.0 percent. Sales and use tax collections were $332 million, up $5 million or 1.6 percent. Corporate and business tax collections totaled $443 million, an increase of $10 million or 2.3 percent over last September....

Year-to-date income tax collections were $2.483 billion, an increase of $141 million or 6.0 percent. Year-to-date withholding tax collections were $2.005 billion, an increase of $104 million or 5.5 percent.

Massachusetts Department of Revenue
October 2, 2006
September Revenues Total $2.070 Billion, Set Record


Chip Ford's CLT Commentary

"A government position is not a license to steal," wrote Salem News columnist Bob Kelly.

It shouldn't be, but it surely has become one over the years -- which is clearly evident in Taxachusetts.  (For those who don't recall or aren't aware, Bob Kelly is the CLT member who wrote "The National Debt From FDR (1941) to Clinton (1996)" with a foreword by Jeff Jacoby, Boston Globe columnist.  We gave away numerous personally-autographed copies of his book as door prizes at a CLT brunch a few years ago.)

Unlike every other license in the Commonwealth that is collected by the state from us average citizens who want to do anything, the cost of which has been increasing in leaps and bounds for years, there's no "fee" to acquire a "license to steal."  All that's necessary is membership in a public employees union, or being a politically-connected employee of some "quasi-independent" state authority.

Which is why all the cries of those gubernatorial candidates who oppose the voters' income tax rollback ballot mandate of 2000 ring so hollow; why their sudden "concern" instead for property tax relief rings even more so.  There is simply no connection.  As we've documented time and again over the years (most recently on Sep. 29, 2006, "Taxpayers are sick from public servants' abuses"), more local aid only translates into more spending on government -- primarily spent on increased "fixed costs" such as public employee pay raises and benefits -- and inevitably a demand for more revenue, property tax increases, when those costs again grow unmanageable.

Whether it's boom or bust, if the economy is in recession or expansion -- whether the state "can afford" to obey the voters at last and roll back the income tax as ordered, or instead needs to "wait and watch" -- regardless of what is happening in the private sector; whether their friends and neighbors are being laid off or taking pay cuts, decreased benefits, and shorter hours to keep their jobs at all; whether some are losing their homes due to property tax increases; regardless, those working in government -- working for us at our expense! -- public employees keep gaining ground, doing better for themselves and their families, year after year consistently, without so much as a hiccup.

It's entirely and completely now out of control, turned around.  We, at one time their employers, now work for them.  Too much of what we earn goes into their pockets as new "entitlements" -- or else.  There is no incentive to reign in the demands of public employee unions.  But if they don't want the jobs at a decent but not extravagant wage and common benefits that most of us have adjusted to, then simply don't apply for the position.

Look for another job!

Nonetheless, getting a foot in the door on the taxpayers' dime as a public employee (it used to be called "public service" not so long ago) is the best lifetime career move many can aspire toward, whether it's at the federal, state, an "authority," or municipal level.  The waiting list to grab a ticket onto this gravy train is endless, the competition fierce.  So why don't those with the power to negotiate contract terms use this obvious leverage?  Because they're all in this together.

For example, the Cape Cod Times recently observed (Sep. 30, 2006, "65 applicants eye Mashpee firefighter slot," by Stephanie Vosk) that there were sixty-five applicants for one advertised firefighter's job in Mashpee.  What happened to competition, and why don't taxpayers benefit with that sort of a demand?

When do we "deregulate" alleged public service?

When state judges doggedly pursued a "long-overdue pay raise" -- which was granted to them in last year's state budget at an additional cost to state taxpayers of $7 million -- Barbara asked:  "Is there some kind of shortage of people in Massachusetts who want to be judges? If there is, I haven't heard about it."

Why didn't those 400 disgruntled and apparently mortified judges simply quit, go out and find a better-paying job as lawyers or something that compensates them for what they think they're worth -- like you and I would?  I believe we know the answer without breaking a sweat, two words.

Gravy Train.

So state revenues are up, again -- again breaking all the records.  But still -- still -- there's no room for the voter-mandated tax rollback.  Our excess taxes will be squandered, all over again, creating a new "benchmark" and the next "fiscal crisis."  The Legislature, and our individual town fathers and mothers, will keep the unions fat and happy, sassy and empowered -- and we mere taxpayers will just keep on keeping on, struggling to maintain the lifestyle to which they've become accustomed, to which they have now internalized that they are "entitled."

As Bob Kelly concluded in one of his columns reproduced in this space:

The government you get is the government you vote for. If you don't vote you lose permission to complain. If you want your vote to mean something - if you want to become a working member of a movement to change your government - read, think and vote. Get rid of those who violate sound principles; vote for those who will reflect sound values.

I can't top that.

Chip Ford


The Salem News
Thursday, October 5, 2006

A Salem News editorial
Local aid benefits some more than others


Beware those - and we include gubernatorial candidates Deval Patrick and Christy Mihos among them - who worship at the altar of "local aid."

There was a time when cities and towns were pretty much responsible for raising their own revenue through the property tax. Then came Proposition 2˝.

The threatened reductions in services and personnel that followed in the wake of that landmark voter initiative forced those on Beacon Hill to share the wealth generated by the sales and income taxes. And then someone figured out that they could raise even more money - and with very little protest - by running a state lottery.

But the politicians apparently lost sight of the fact that in addition to wanting to place a cap on their property taxes back in 1980, voters also wanted a cap on government spending. But they failed to make the latter goal part of the new law. So as soon as municipalities discovered those alternate and semireliable sources of revenue called "local aid" and "lottery receipts," the cap came off the spending side.

Certainly there have been consolidations and layoffs at the municipal level during bad economic times when tax revenues dropped and the state couldn't afford to provide as much assistance as it had previously. But most city and town employees have received regular pay increases, and the gap between the benefits provided by employers in the private and public sectors has actually widened over the past quarter-century.

Few of those working for even the largest, most generous corporations are guaranteed 80 percent of their salary upon retirement, can buy back their unused sick days when they leave, or pay only 10 percent of the cost of their health insurance. But communities throughout the commonwealth count these expensive benefits among the "fixed costs" to which they are obligated.

Patrick, Mihos and others talk about how they won't sign onto the voter-mandated income tax rollback for fear of reducing the amount of assistance to cities and towns. But the intelligent voter ought to ask how much of any additional money they provide will go to increasing services and how much will go to pay more employees higher salaries and provide them with even better benefits than they currently receive.

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The Salem News
Saturday, September 16, 2006

Election '06:
Learn and think about what candidates for office are saying
By Robert Kelly


Many elections are humdrum affairs. Not this one.

There is a serious disconnect between the people and the Legislature, and elections are a most effective way for communicating that fact to the all-too-comfortable and arrogant men and women in the Legislature who seem to increasingly believe that they know best - and that you know nothing.

A few of the hot-button issues of the day will be discussed here in an order that has nothing to do with their relative significance.

* Taxes: The state is awash in money and the public has spoken on the issue of tax reduction. It wants the reduction that was promised - now.

Find out how your legislators have voted on this issue. Vote against those who refuse to return your money because they have new ideas of where to spend it.

* Education: Listen to a gubernatorial debate or speak with a legislator about education and the Pavlovian response will inevitably be that government needs more money for this, that and the other thing. A mountain of evidence, however, shows decisively that reform, not money, is the need in education. If your legislator has evidenced more loyalty to teacher unions than he/she has to the needs of your kids, vote him/her out of office.

* Marriage: The institution of marriage in Massachusetts has become a national joke - not because homosexuals are pursuing an agenda (which is their right), but because legislators have not had the courage to stand up for the values that most of them allegedly stand for when they go to church or synagogue each weekend. Identify the legislators who speak with forked tongue on this issue and vote them out of office.

* Hypocrisy: In a magnificent display of generosity with your money, legislators recently awarded a pension to the estate of a deceased member who had refused to qualify for it during his lifetime. This is but another example of the passion with which these men and women will protect and enrich themselves and other members of the "club" whenever the opportunity presents itself. Identify those who supported the Ruane pension and vote them out of office.

* Government wages and fringes: Contracts are regularly negotiated with unions that represent government employees, including teachers. The net effect of this process has been cushy retirement programs (always identified with government work), and a wage/fringe benefit structure that now outdistances the private sector. This feeding at the trough must stop. Identify those legislators who play footsies with the unions so that you can pay higher taxes - and vote them out.

The government you get is the government you vote for. If you don't vote you lose permission to complain. If you want your vote to mean something - if you want to become a working member of a movement to change your government - read, think and vote. Get rid of those who violate sound principles; vote for those who will reflect sound values.

Robert Kelly of Peabody is a regular contributor to the opinion pages of The Salem News.

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The Salem News
Wednesday, August 2, 2006

Legislators should have this much 'compassion'
for those who pay the bills
By Taylor Armerding, Staff writer


Let's get one thing straight: The Legislature's vote last week to grant a $33,000 pension to the widow of Salem's late state Rep. Mike Ruane had nothing to do with compassion. Nothing. And all of the flowery rhetoric about "dignity," all the self-congratulatory hugs between Sen. Fred Berry, D-Peabody, and Rep. Angelo Scaccia, D-Boston, all the declarations that this was "the right thing to do;" will not change that reality.

Ruane's widow, Helena, is indeed worthy of compassion, for her loss of a life partner. But what the Legislature did was not compassion. This was theft, in broad daylight.

Compassion is when you dig into your own pocket to provide some help to somebody in need. Gov. Mitt Romney had offered legislators a chance to do that. He even said he'd participate.

If Helena Ruane was in dire need of a pension, the governor said, legislators should put up the money themselves for the pension that Mike Ruane had chosen not to take.

But legislators wanted nothing to do with that. They voted to dig into somebody else's pockets - yours and mine - and then claimed they were being compassionate.

Ruane, who died June 25 after a long battle with cancer, already had a pension - a disability pension he'd earned when he was injured while working for the city of Salem. But during his three-decade legislative career he never paid into the state retirement fund that finances regular employee pensions. That, at least at the start, was because he had been told by the state attorney general that he could not collect both.

But that all changed 12 years ago, in 1994, when his legislative pals changed the law to allow him to pay into that system, and thereby qualify for the pension.

Still, he never did. For 12 years he'd had the opportunity to pay into the system and qualify for a state pension, but didn't take it. Now his "compassionate" caretakers in the Legislature are claiming that Mike never really knew about the opportunity; that this was an oversight; that without this pension, his family will suffer for an innocent mistake.

Who are they kidding? If Mike Ruane was still here, he'd probably have trouble witnessing all this blatant dissembling with a straight face.

This was no mistake. This was an informed decision by a competent adult.

Ruane was the self-proclaimed guru of legislative minutia. I used to talk to him regularly, and he always bragged - I guess with some justification - that he knew the ins and outs of the state budget better than anybody. You had a question about the budget, you went to Mike. You had a question about some arcane law or regulation, you went to Mike.

And now his colleagues are claiming that he didn't know about a law passed 12 years ago as a favor specifically to him?

Come on.

Ah, but the compassion brigade is also claiming that in the end, we taxpayers won't be on the hook for this anyway, because whatever pension money is paid to Mrs. Ruane will become a lien on her property, and then be recovered after she passes away.

I don't buy that either. Anybody who does, doesn't know how the Legislature works.

I'm willing to bet that when the furor over this dies down and everybody's attention is focused on the next of an endless series of outrages, a friendly rep or senator will quietly insert a provision into a bill that will eliminate that lien, and it will get passed with no debate.

You know, all in the interests of preserving the "dignity" of the family - at taxpayer expense.

Sure, when it comes to the overall budget, $33,000 doesn't even amount to a drop in a $26-billion bucket. But as an illustration of legislators' twisted view of "public service" and their contempt for their constituents, this ranks right up there with the most outrageous.

They aren't there to serve the public. We, the public, are there to serve them. The pension system is just one more piggy bank to raid at their pleasure, and our expense, in order to do favors for themselves and their friends.

Are Fred Berry, Angelo Scaccia and their cohorts going to search the private sector for those of us who have made decisions that don't work out so well for us financially? Of course not. It is only members of the club, or others on the public payroll starting with police and firefighters, who get shielded from any painful consequences of their decisions.

Bad enough that they get away with it. Even worse that they call it compassion.

Taylor Armerding is associate editorial page editor of The Eagle-Tribune.

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The Salem News
Wednesday, September 13, 2006

Your taxes at work
By Robert Kelly

Sure, when it comes to the overall budget, $33,000 doesn't even amount to a drop in a $26-billion bucket. But as an illustration of legislators' view of "public service" and their contempt for their constituents , this ranks right up there with the most outrageous.

- Taylor Armerding, Salem News, Aug. 2, 2006

This statement of justifiable outrage was triggered by the recent decision by the Legislature to grant a pension to the widow of a deceased colleague (the name is unimportant to the principle in play) who had never paid into the state retirement fund for reasons that he, while alive, found sensible.

The situation was made even more irritating by the surrounding circumstances that exposed the hypocrisy of those who participated in this burglary.

But shameless actions like this, nasty as they are, have a good side: They expose a bit more of what happens within the club. And taxpayers are becoming increasingly aware that the club is taking them to the cleaners on a regular basis.

The situation that provoked Armerding's column, and that disturbed many others, was a state issue. But the rip-off is ongoing at the federal level too, as a recent study by the Cato Institute made clear.

How many times have you heard federal employees claim that they are giving up the chance to earn a big income in the private sector so that they can serve their country?

Bananas!

Apart from the question about their qualifications for work in the highly competitive private sector, they would be lucky to do better if and when they did find a job. That's because the general belief that government work doesn't pay well is a myth. Consider some of Cato's findings:

* The average compensation package for federal workers in 2005 was twice the average for private sector earners.

* The benefit portion of wages in 2005 was worth 50 percent of average federal compensation; the private sector benefit package was worth 18 percent of average compensation. Obviously few, if any, federal employees work without a full plate of fringes, while many private-sector employees do.

* Federal compensation without fringes was 62 percent higher than that for the average private-sector worker in 2005.

* Since 1990, average federal pay has increased 129 percent - as opposed to 74 percent in the private sector. Over the past five years, federal pay has gone up 38 percent - as opposed to 14 percent in the private sector.

* The rate of layoffs in the federal work force is one-quarter the rate in the private sector.

Yes, it's true that Massachusetts taxpayers are being taken by deals like the one mentioned above. But that's just the tip of the iceberg. Every day contracts are being signed that award pay raises and benefit packages that the average Joe would die for.

It won't always be so. The people will learn. And the ax will fall.

Robert Kelly writes a weekly column for The Salem News.

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The Boston Globe
Saturday, September 30, 2006

Massport refuses to relent on sick pay
Romney is rebuffed as directors delay action
By Sean P. Murphy, Globe Staff


In a stinging setback for Governor Mitt Romney, the Massachusetts Port Authority board of directors yesterday refused to reduce its sick-pay policy, retaining a benefit that is the most generous in state government and has provided retiring employees with payouts of as much as $201,000.

Romney had called for the benefit to be brought into line with the rest of state government, which provides compensation for one-fifth of an employee's unused sick time.

Instead, after a parade of Massport employees pleaded with the board to save the benefit, members voted 6 to 1 to study the issue. A report is due back within 60 days.

"The governor expressed his position, but we can't force them to vote our way," Eric Fehrnstrom, Romney's spokesman, said after the meeting. "At the end of the day, we hope the board will adopt a policy that is fair to the taxpayer. What is clear is that the current policy is extravagant."

The vote suggests Romney's power to shape state policy may be declining. Four of the seven members of the board are Romney appointees, but it's not clear how hard the governor, who travels to New Hampshire today, lobbied for the change.

The study approved yesterday is unlikely to be finished until after the Nov. 7 gubernatorial election.

The board took up the issue after a Boston Globe story Sept. 24 detailed the policy, which provides retiring Massport employees with compensation for 100 percent of their unused sick days. Employees at other state agencies receive compensation for only 20 percent of their days.

Massport employees accrue sick days at a rate of 15 per year, and since 2001, a dozen employees have received more than $100,000 upon retirement.

The Massport policy also allows employees who resign from the agency but do not retire to receive 50 percent of the cash value of their unused sick time. That allowed former executive director Craig P. Coy to receive almost $28,000 after four years on the job and former executive director Virginia Buckingham to receive $5,850 after 2 years. State employees who resign from other agencies do not receive compensation for unused sick time.

About 75 Massport managers and workers crowded into the boardroom for the mid afternoon meeting yesterday. Seven employee representatives urged the board to preserve the policy, saying they were counting on the payout in their financial planning. Some said the sick-time policy was a factor in their decision to work there.

Patricia Naper, a budget manager at Massport for 38 years, said she and her financial adviser factored a cash payout for unused sick time into her retirement plans. "To be within two or three years [of retirement], to have this taken away, please, be fair, be equitable," she told the board.

Board member Ranch Kimball, a top manager in the Romney administration, read a letter from Romney saying "Massport's policies should be revised to bring them into line with the policies at executive branch agencies, effective immediately, for current employees as well as future hires."

Besides reading that letter, neither Kimball nor the other six board members made any public comment, voting instead to go into private session.

After two hours in private session, the board returned, and Kimball made a motion to adopt Romney's recommendation. It failed for lack of a second.

Paul D. Foster, another Romney appointee, made the motion to study the policy and gather information on how it compares with other policies within and outside Massachusetts government. Board members Fred Mulligan and Paul J. McNally, both Romney appointees, voted with Foster, as did three members appointed before Romney became governor: John F. Monahan Jr., Lois J. Catanzaro, and the chairman, John A. Quelch.

Kimball was the only member who voted against the study.

"The governor's point of view was made very clear," Kimball said after the meeting. "We'll see what happens."

The vote contrasts sharply with the swift action taken recently at the Massachusetts Turnpike Authority, which Romney's administration took control of following the deadly ceiling collapse inside the Big Dig.

At the Turnpike Authority, John Cogliano, Romney's secretary of transportation, quickly repealed a change made by chairman Matthew J. Amorello on July 7 that had sweetened sick-time payouts for turnpike managers and administrative staff members.

Amorello, forced to resign after the ceiling collapse, left the turnpike Aug. 15. The Romney administration said he had overstepped his executive authority in making the sick-time change.

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The Salem News
Saturday, September 30, 2006

Government wages, benefits should reflect
those that prevail in private industry
By Robert Kelly


Years ago it was reasoned that certain state agencies should be established as independent fiefdoms that operate outside of the corruptive influence of the political system.

Seemed like a good idea. It has been tried -- and it has failed.

The proof? The recent revelations concerning the disgustingly grabby sick-leave policies of the Massachusetts Turnpike Authority and the Massachusetts Port Authority.

Stand back a bit and seek some perspective.

Credit is given to the labor movement in Australia for the appearance in 1922 of sick leave in collective bargaining agreements. The idea, a good one, was to provide for a controlled amount of sick leave to employees for strictly defined and well-controlled purposes.

If the sick leave earned for a given year was not needed, it expired. There was no such thing as accumulated sick leave to be paid at termination. It was designed to be an employee benefit, not an employee entitlement.

In that form the sick-leave benefit found its way into the collective bargaining agreements of America, and it essentially remains in that form in most of the private sector. But not in the public sector – not at Massport of the Turnpike Authority.

To make the point, let’s examine a few cases of sick-leave abuse that made news recently:

* Massport - Policy allows departing employees 100 percent of the value of accumulated, unused sick leave versus 20 percent to other state employees; $6.2 million was paid to departing employees over the past five years, including $201,000 to the retired budget director and $28,000 to a former executive director who served only four years in the post.

* Turnpike Authority - Matthew J. Amorello was recently forced to resign as chairman. At that point, sick-pay policy provided for a 20 percent payout on unused days. Before leaving office, Amorello unilaterally extended the benefit to resigning employees that had heretofore been restricted to retiring employees. Seven departing employees took advantage of the more liberal policy before it was recently repealed by the incoming chairman and received an extra $133,163 in severance pay.

These revelations come on the heels of recent columns that have appeared in the Salem News about approved and undeserved pension payments, and about the increasingly lush wage/fringe packages that are now typical in the government sector. And memory is hardly tested to remember the comments of Mayor Bonfanti, Peabody, about the lush health insurance package that he is, by contract, bound to finance year after year.

A gubernatorial race is underway. Candidates are looking for a good issue. Here it is.

Appoint a commission. The objective? To examine wage/fringe practices across the board, including those that apply to legislators, their pensions, and the qualifications for pension.

The mission? To adjust those policies to conform to private sector practices and to restrict year-to-year changes to the degree that they are made in the private sector.

Enough! A government position is not a license to steal.

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Massachusetts Department of Revenue
October 2, 2006

September Revenues Total $2.070 Billion, Set Record


Revenue Commissioner Alan LeBovidge today announced that preliminary revenue collections for September were $2.070 billion, an increase of $129 million or 6.6 percent over last September. September collections passed the $2 billion mark for the first time.

Total tax collections for the third month of fiscal 2007 were $31 million above the September benchmark. Year-to-date collections were $4.505 billion, an increase of $170 million or 3.9 percent. After three months, fiscal ’07 collections are $1 million below the benchmark.

“Overall September was a good month and it helped make up most of the ground lost in first two of the fiscal year. It was a good first quarter for collections,'' LeBovidge said. "Perhaps the only note of concern is the 21 percent decline in deeds excise tax collections that confirms a real estate slowdown."

The two-day sales tax holiday in August seemed to have little impact on sales and use tax collections for September. August sales and use tax collections are reported and paid by retailers in September. This year’s total was up slightly from last year. The true impact of the Sales Tax Holiday Weekend will not be known until December when DOR completes its analysis.

Income tax collections for September totaled $1.133 billion, an increase of $107 million or 10.4 percent over last September. Withholding tax collections totaled $702 million, an increase of $76 million or 12.0 percent. Sales and use tax collections were $332 million, up $5 million or 1.6 percent. Corporate and business tax collections totaled $443 million, an increase of $10 million or 2.3 percent over last September.

Year-to-date income tax collections were $2.483 billion, an increase of $141 million or 6.0 percent. Year-to-date withholding tax collections were $2.005 billion, an increase of $104 million or 5.5 percent. Year- to-date sales and use tax revenues were $1.041 billion, a decrease of $9 million or 0.9 percent. Year-to-date corporate and business tax collections were $524 million, an increase of $22 million or 4.4 percent.

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