CLT UPDATE
Friday, February 23, 2007
MTF calls for broad-based, not
business, taxes
Gov. Deval Patrick yesterday admitted he “really
screwed up” by spending tax dollars on a leased Cadillac and high-end
office furniture, but he strongly defended the hiring of a
$72,000-a-year chief of staff for his wife.
“Every governor has had staff to help support the work of the office,
including the work of the first lady,” Patrick said during an impromptu
press conference. “It’s official business.”
However, a Patrick aide could recall only two events Diane Patrick has
attended this year, one to promote early education initiatives in the
State House and a second to appear at a reading event for children in
Springfield.
The Boston Herald
Thursday, February 22, 2007
Deval: ‘I really screwed up’
Admits gaffe on Caddy, furniture
but defends $72G for wife
But in apologizing, he also chided the reporters who have
hounded him about the spending since the first reports surfaced.
"I think it's very important to me that you in the media help me get the message
out about what it is we are concentrating on," Patrick said. "That is what the
public needs to know about and what it is we are working on, and unless I get
this off your screen, then I don't think we're going to be able to get that
done."
The Boston Globe
Thursday, February 22, 2007
Patrick: 'We screwed up' on spending
Patrick will pay the state back with his personal funds, not
those of his campaign.
Barbara Anderson, executive director of Citizens for Limited Taxation,
said the move is a step in the right direction.
"It shows he reacts appropriately to criticism," Anderson said, but added she is
troubled that the chief of staff will stay. "It wasn't about the car itself, it
was the accumulating mistakes. We need to see if he changes his mindset and sees
the world the way he told us he saw it when he ran for office."
The Lowell Sun
Wednesday, February 21, 2007
Patrick to pick up portion of Caddy bill
Gov. Deval Patrick has a good sense of history, so good that
he's taking his administration back to the good ol' spending days of the Dukakis
era.
Hey, who are we to complain? Those days were good for Democrats and everyone
else on the public payroll and public dole....
It's the Patrick era and you've got to spend money to make money, right?
Or at least that's how one can interpret the governor's glib responses to
questions about the lavish spending in light of the state's $1 billion budget
deficit.
A Lowell Sun editorial
Wednesday, February 21, 2007
DeVille Patrick
Governor Deval Patrick wants you to know he's sorry.
Sort of. Kind of. Maybe not sorry, exactly.
The Boston Globe
Thursday, February 22, 2007
Having it both ways
By Adrian Walker
In the annals of non-apology apologies, the one offered by
Gov. Deval Patrick this week surely ranks among the most insincere.
A Boston Herald editorial
Friday, February 23, 2007
A sorry apology from the governor
Still, each governor should be entitled to dignified
surroundings that reflect his personal tastes. The criticisms this past week of
Patrick as a big spender on personal luxuries have ballooned beyond all
rationality, drowning out coverage of other state issues. He deserves a better
break....
Patrick will be fortunate if he does not suffer serious erosion in support from
the vast grass-roots following that he built so effectively in his campaign. He
has been openly nurturing this political army in part so that it can back him in
key legislative battles later on. But it is clear from letters and e-mails that
some recent supporters have quickly become disaffected.
A Boston Globe editorial (at
last!)
Friday, February 23, 2007
Much ado about drapes
Deval L. Patrick’s recent transformation from a campaigner
with perfect political pitch to a leader showing signs of tone deafness is
surprising, to say the least.
A Telegram & Gazette editorial
Friday, February 23, 2007
Perfect-pitch Patrick shows signs of tone-deafness
Attempting to end days of negative headlines, Gov. Deval
Patrick yesterday unveiled a new tax credit for low-income homeowners,
portraying it as a bold effort to deliver promised property tax relief to Bay
State families.
But the plan drew immediate criticism from business leaders and GOP lawmakers,
some of whom sharply denounced its reliance on tax hikes on businesses. Patrick
wants to pay for the homeowner credit by closing “corporate loopholes,” a term
opponents deride as a political euphemism for a tax increase.
“This is anything but closing loopholes,” said Michael Widmer, president of the
Massachusetts Taxpayers Foundation. “This is a large tax increase on
corporations at a time when the state’s economy is struggling.” ...
But critics said the income restrictions on the plan, which mirror those in
place for a senior tax credit already in place, will mean that only 6 percent of
the state’s homeowners will be eligible for the new credit.
“The cynical part of me says this is just an attempt to adjust the headlines,”
said state Rep. Brad Jones (R-North Reading), referring to criticism of
Patrick’s Cadillac and high-end office furniture. The governor rode to
yesterday’s press conference in a Chevy SUV instead of his Caddy.
Jones questioned the need to raise $500 million annually in corporate taxes when
the homeowner tax credit would cost only $75 million a year. “It’s going to
provide marginal relief for a select group of people,” he said. “It doesn’t show
a lot of creativity.”
The Boston Herald
Friday, February 23, 2007
Deval tax credit plan ripped by biz critics
As many as 100,000 Massachusetts homeowners would receive up
to $870 a year in tax relief under a plan unveiled by Governor Deval Patrick
yesterday that relies on the state's corporate community to foot the bill.
The new governor, who made property tax relief one of his signature campaign
themes, proposed paying for the $75 million initiative by eliminating what he
said were outmoded tax exemptions businesses have been exploiting. If the
Legislature agrees to all the tax changes, they would eventually produce about
$500 million a year....
Michael Widmer, president of the business-backed Massachusetts Taxpayers
Foundation, was scathingly critical of Patrick's plan.
"The proposal provides limited property tax relief at a high cost to the
Massachusetts economy," said Widmer, adding that it would be economically
destructive to ask corporations to take another $500 million hit on top of the
$400 million they had to pay after the Romney administration closed other
so-called loopholes and a $600 million increase in unemployment insurance taxes
in 2004.
"Cumulatively, you're talking about $1.5 billion annually in additional taxes at
a time when our economy is weak, 150,000 jobs below where we were in 2001," said
Widmer, whom the Legislature often turns to for budget analysis. "This adds
significantly to the competitiveness disadvantage facing Massachusetts
businesses."
The Boston Globe
Friday, February 23, 2007
Patrick plan has tax break for homes
Residents could get $870; business levies would rise
But the new governor can rewrite the lead. Ideally, it will
read something like this: “Recovering from some initial rookie mistakes, Gov.
Deval Patrick rebounded with several bold proposals and won a resounding
legislative victory on the core promise of his campaign, cutting property
taxes.”
In other words, Patrick can easily recover from any recent missteps. Wednesday’s
apology was a start. However, yesterday’s puny property tax relief plan, funded
by massive corporate tax hikes, does little to help Patrick’s cause. Here are
some thoughts on what to do next.
Propose real property tax reform that won’t cost the state a dime. Taking a
page out of Citizens for Limited Taxation’s book, Patrick can suggest
allowing voters to place an underride on their local ballot, empowering them to
cut their own taxes if they so choose. Also, he can propose that override votes
only be held on the date of the biennial election, instead of whenever municipal
leaders feel like it. This will empower everyday citizens, and put them on a
level playing field with the special interests which turn out in special
elections.
The Boston Herald
Friday, February 23, 2007
Gov can still right those rookie errors
By Virginia Buckingham
Michael Widmer, president of the business-backed
Massachusetts Taxpayers Foundation, said businesses have been paying $1
billion annually in new taxes for the last four years.
"The major flaw in the proposal is that the state will sacrifice jobs in order
to provide limited property tax relief," Widmer said. "The corporate tax
proposals are major changes. They are anything but loophole closings." ...
House Minority Leader Brad Jones (R-North Reading)
said he appreciates Patrick's effort to provide property tax relief, as
discussed in his gubernatorial campaign, but there are questions about
the plan, he said.
"That being said, he delivered limited relief to a small pool of
people," said Jones, who said if the circuit breaker program only starts
in January of 2008, people can only see some relief in 2009 when filing
their tax returns. "Why not have this plan take effect for July of
2007?"
He also questioned why Patrick is proposing relief of $75 million when
the corporate tax changes are estimated to bring $500 million a year.
"Then the question is, why aren't we doing more broad-based relief?"
said Jones.
State House News Service
Thursday, February 22, 2007
Patrick details $75M property tax break,
looks to attract $500M in biz taxes
The governor drew support, however, from Massachusetts
AFL-CIO president Robert J. Haynes: "It is refreshing to have a governor who
understands that we all have a role to play in supporting this Commonwealth, and
that corporations have as much responsibility to pay for the essential
government services they benefit from as individuals do.
"Our hard-working members and their families can't cherry-pick which taxes they
want to pay or not pay, and corporations shouldn't be able to, either."
The Boston Globe
Friday, February 23, 2007
Businesses blast governor's tax plan
Foes say jobs, not just loopholes, are what's at stake
Chip Ford's CLT Commentary
Waving the white flag of desperate damage control,
Gov. Deval Patrick late Wednesday finally backed down from burdening
taxpayers with his wont for aristocratic opulence. He announced
that he'll pay the difference between his top-end Cadillac limo and
former governors' utilitarian cars -- and that he'll shell out-of-pocket
for his lavish office furnishings. He's sticking to his guns
though when it comes to his wife's "chief of staff" to handle scheduling
her occasional appearances. That alone is a ridiculously
unnecessary albatross if he's trying to put this initial image of
profligacy behind him. Almost, but not quite there Your Royal
Highness.
Not to change the subject you know -- well, not
exactly -- yesterday he took the advice of many and released an element
of his upcoming budget that supposedly will satisfy his campaign pledge
to relieve the property tax burden -- in lieu of rolling back the 17-year
old "temporary" income tax hike; the reduction voters overwhelmingly
mandated in 2000.
We said that the devil is in the details. That
must now change to The Deval is in the Details.
What will his new "property tax relief" proposal
provide? Very little if anything whatsoever for the average
taxpayer.
First, it is not property tax relief in any
way, shape, or form. It will not affect property taxes
even an iota. Property taxes will continue to increase. What
his proposal will do is provide a state income tax credit for
some who fit into his particular and narrow criteria. The rest of
us -- 5 out of 6 homeowners -- will continue to pay the full property
tax with no relief, none. Municipalities will still have the full
property tax and increases under Proposition 2˝ to
spend, negotiate away, or otherwise squander.
His proposal provides a state
income tax credit for a select very few of his choosing. CLT's
and the voters' 2000 ballot income tax rollback to 5 percent would provide an
income tax reduction for everyone who pays income taxes. This is a backdoor
end-run around the oft-defeated "Graduated Income Tax" when it's been on
the ballot. So it's no wonder that Noah Berger of the
Massachusetts Budget and Policy Center supports the business taxes
needed to fund it. MBPC used to be the Tax Equity Alliance for
Massachusetts. TEAM is more affectionately known here as Tax
Everything And More. TEAM was behind the defeated Grad Tax.
After, the tax-and-spenders changed their organization's name -- to
protect the ... er ... guilty.
More will follow here, once His Royal Majesty's
budget is revealed, if it is and we don't have to do another
Public Records Law demand for it.
Michael Widmer of the so-called
Massachusetts Taxpayers Foundation must be having heart palpitations
these days as this Democrat administration stabbed him in the back. Michael, if
you recall, was full of himself after
being appointed to the incoming Patrick transition team as a budget
advisor. He figured he had it made with the new governor's policy
decisions, a free ride if he kissed-up enough to tax-and-spenders, for
which he's dependable.
Widmer's now in high dudgeon as His Excellency
targets his MTF membership to carry its "fair share" of the revenue
burden. (How long can he continue to survive his ineptitude?)
Today, on WRKO's "Finneran's Forum," Boston Globe
business columnist and regular guest Steve Bailey commented that he'd
spoken with Widmer yesterday. Widmer urged that, instead of
closing "corporate loopholes" or increasing taxes on his Fat Cat Big
Business MTF members, it consider an increase in "broad-based taxes"
such as the income or sales tax.
When Michael pontificates in the name of MTF he's
usually more subtle. Today he's panicking. That alone is
gratifying to me.
Finally, The Boston Globe editorial elites found their collective voice. It only took them a week! Oh
sure, Patrick made some rooky mistakes, the Globe admits (how could they
surface without that admission?) -- but "Much ado about drapes"?
Even its columnist, Adrian Walker, who I critiqued in my last
commentary, has concluded in his column of today: "The thing is, Patrick wants it all. He wants to be deep, yet stylish. He
wants to be a populist, just one with an office out of Architectural
Digest. He wants public affection, but public scrutiny makes him
prickly."
Where has the Morrissey Boulevard editorial elite
been until now? MIA for a whole week, dug in deep into their
bunker and trenches avoiding radioactive fallout.
 |
|
Chip Ford |
The Boston Herald
Thursday, February 22, 2007
Deval: ‘I really screwed up’
Admits gaffe on Caddy, furniture
but defends $72G for wife
By Casey Ross
Gov. Deval Patrick yesterday admitted he “really screwed up” by spending
tax dollars on a leased Cadillac and high-end office furniture, but he
strongly defended the hiring of a $72,000-a-year chief of staff for his
wife.
“Every governor has had staff to help support the work of the office,
including the work of the first lady,” Patrick said during an impromptu
press conference. “It’s official business.”
However, a Patrick aide could recall only two events Diane Patrick has
attended this year, one to promote early education initiatives in the
State House and a second to appear at a reading event for children in
Springfield.
“Diane Patrick seems like a very nice woman, but she was not elected
governor,” said Brian Dodge, executive director of the state’s
Republican Party. “Why are taxpayers burdened with a $72,000 expense to
make sure she shows up on time to events?”
As questions continued about Patrick’s spending, the administration last
night released an itemized list of $27,400 in furniture he bought for
his State House office suite. Patrick initially paid for the furniture
with taxpayer dollars, then opted to reimburse the state.
The list includes $4,470 for two couches from the luxury retailer Cabot
House, $12,300 in draperies from Boston Window Design and $1,650 for a
new desk from Oak Hollow Antiques.
Patrick has also agreed to pay $543 per month toward the $1,166 lease of
his Cadillac DTS, a sum that covers the difference between the cost of
his luxury vehicle and a more modest Ford Crown Victoria that was used
by Gov. Romney.
During comments to reporters, Patrick acknowledged he made mistakes on
some of his spending decisions, even as he defended the need for quality
office furniture.
“Oh yeah, I really screwed up,” Patrick said. “But I receive heads of
companies and heads of labor. I receive community groups, members of the
Legislature, members of the diplomatic corps. I think the governor’s
office should look nice, so I’m prepared to be a BYO governor: bring
your own furniture.”
Despite his apology, Patrick told reporters that he was sorry about the
spending controversy because it has drawn attention from other business.
“I am so sorry that we have all spent the kind of time we have on what
we have spent time on, and I’m sorry to have been responsible for that,”
he said.
Even as he decried the media’s focus, Patrick said he wants to work with
reporters. “It’s very important to me that you in the media help me get
the message out about what it is we are concentrating on,” he said. “The
municipal partnership package, for example, the budget that’s coming
out, the way we’re taking steps to reduce property taxes . . . Unless I
get this off your screens, then I don’t think we’re going to get that
through.”
Department of interior decorating
By Herald staff
Bargain basement furniture just won’t do in the Corner Office. But
top-shelf trimmings are expensive, so after originally billing
taxpayers, Gov. Deval Patrick decided to pick up the tab himself. Here’s
the damage:
2 couches from Cabot House - $4,470
Draperies from Boston Window Design - $12,306.35
2 wing chairs from Baker, Knapp and Tubbs - $3870.36
Desk from Oak Hollow Antiques - $1,650
Sideboard from Oak Hollow Antiques - $1,395
Sideboard from Patriot warehouse - $1,000
Three lamps and shades from Neena’s/Stuart Swan - $1,074.15
Sofa table from Thomasville - $486
Total purchase - $26,251.86
Shipping and handling - $1,136
Total cost: $27,387.00
Source: Governor’s office
The Boston Globe
Thursday, February 22, 2007
Patrick: 'We screwed up' on spending
By Andrea Estes
Governor Deval Patrick for the first time publicly expressed regret
yesterday for spending thousands of dollars on new office decor and a
luxury car lease, but stood behind his wife's need for a $72,000 aide
and the effort to make his corner office suitable for visitors.
"Oh, yeah, we screwed up," Patrick told a horde of reporters, a day
after promising to repay the state for office furnishings and a portion
of the lease for his official car. "I am so sorry that we all have spent
the kind of time we have on what we have spent time on, and I am sorry
to have been responsible for that."
The new governor's public mea culpa came after a week of spiraling
reports about his spending of taxpayer money, including $1,166 each
month on a Cadillac DTS and $12,306 on new draperies in his office.
But in apologizing, he also chided the reporters who have hounded him
about the spending since the first reports surfaced.
"I think it's very important to me that you in the media help me get the
message out about what it is we are concentrating on," Patrick said.
"That is what the public needs to know about and what it is we are
working on, and unless I get this off your screen, then I don't think
we're going to be able to get that done."
On Tuesday, Patrick announced he would contribute $543 per month toward
the lease of the $46,000 Cadillac, bringing the state cost in line with
the monthly payment on the more modest Ford Crown Victoria used by his
predecessor, Mitt Romney.
Patrick also said he would repay taxpayers for $27,387 in furniture he
purchased for his corner office. An interior designer helped Patrick
select two wing chairs priced at $3,870, two couches at $4,470, damask
draperies for $12,306, and other furnishings from a variety of antiques
and furniture stores, including the high-end Baker Knapp & Tubbs.
Aides said the state did not pay for the designer's services. They said
they did not know whether Patrick paid the designer, who is a personal
friend.
Patrick said yesterday that the office needed a makeover.
"I receive heads of companies, heads of labor. I receive community
groups, members of the Legislature, and members of the diplomatic
corps," he told reporters after a State House event. "I think the
governor's office should look nice, and I'm prepared to be a 'BYO'
governor, bring your own furniture."
Patrick said he had replaced items that Romney personally owned and took
with him when he left office. According to Romney spokesman Eric
Fehrnstrom, Romney left behind draperies, a desk, a desk chair, a hutch,
a conference table, and chairs. He took a sofa and two armchairs that he
had personally purchased, said Fehrnstrom.
Patrick also insisted yesterday that the appointment of a chief of staff
for his wife, Diane, a partner at Ropes and Gray, was appropriate.
"Every governor has had staff that helps support the work of the office,
including the work of the first lady," he said.
In several previous administrations, however, another member of the
governor's staff helped the governor's spouse with scheduling, rather
than a specifically designated chief of staff.
Patrick suggested that it is only the media, not the public, that are
questioning his personal spending.
"I will tell you -- in the grocery store, at the cleaners, running
errands on the weekend, I get a very different kind of feedback than I
get in this gathering," he said.
But in Internet chat rooms and websites, a nascent disillusionment has
emerged, even among supporters.
It isn't the first time Patrick has accused the news media of missing
his message and the significance of his broad-based victory. "Whether it
was skepticism, distraction, or the cynicism so many of us try to pass
off as sophistication, some of your reporters missed it," he told a
meeting of the Massachusetts Newspaper Publishers Association in late
November.
". . . Don't trivialize optimism and hope,'. . .' he warned then . "It
built this country. It built my life."
On Friday, when news first broke about his use of the Cadillac, Patrick
adamantly defended his choice.
He initially said that Ford Crown Victoria sedans were no longer
available, but his aides later corrected that answer, explaining that
the new Crown Victoria models did not meet State Police security
standards.
By Tuesday, after four days of relentless coverage, Patrick had changed
his mind.
In a statement, he said he could not "in good conscience" ask his agency
heads to make tough spending decisions about how to close the state's $1
billion budget deficit without making some tough choices himself.
The about-face followed meetings with advisers about how to deal with a
rising tide of criticism that threatened to obscure other portions of
his agenda.
Patrick, who was swept into office on a wave of grass-roots popularity,
at first seemed tuned into the significance of symbols, removing a red
velvet rope that had kept the public away from the governor's office and
reopening an elevator that had been reserved for the governor.
But his initial rejection of criticism over the Cadillac lease led
critics to ask whether he recognized how decisions like the choice of an
automobile could reshape the public's view of him.
The Lowell Sun
Wednesday, February 21, 2007
Patrick to pick up portion of Caddy bill
By Hillary Chabot
It's payback time for Gov. Deval Patrick.
Facing backlash for a perceived misuse of state funds, Patrick promised
to personally pay the state part of the price tag for his new Cadillac
DeVille and for $27,400 worth of new furniture in his office.
A $72,000 aide for First Lady Diane Patrick, however, stays on the state
payroll.
Patrick released a somber statement about the $543-a-month
reimbursement, signaling an abrupt turnaround from his chuckling
dismissal last week.
The amount is the difference between the lease payments for the Cadillac
and what the Crown Victoria used by former Gov. Mitt Romney would have
cost.
"All weekend long, I have been struggling with the budget constraints we
are facing in the Commonwealth. There are tough choices to make. I
realize I cannot in good conscience ask the agencies to make those
choices without being willing to make them myself," Patrick said in a
statement.
Patrick came under fire last Friday for a pattern of luxury buys using
taxpayer dollars, especially as he faces a $1 billion deficit in the
upcoming budget. Patrick had asked department heads to cut 5 percent to
10 percent from their own budgets to make up the gap.
He used the state helicopter twice, hired a $72,000 chief of staff for
his wife, and replaced the Crown Victoria with a Cadillac.
Patrick also refurnished his office with draperies, tables, lamps and a
desk at a cost of $27,387, but he is reimbursing that money.
Romney had outfitted the office with his own personal furnishings,
according to a statement from Patrick.
Patrick will pay the state back with his personal funds, not those of
his campaign.
Barbara Anderson, executive director of Citizens for Limited
Taxation, said the move is a step in the right direction.
"It shows he reacts appropriately to criticism," Anderson said, but
added she is troubled that the chief of staff will stay. "It wasn't
about the car itself, it was the accumulating mistakes. We need to see
if he changes his mindset and sees the world the way he told us he saw
it when he ran for office."
The Lowell Sun
Wednesday, February 21, 2007
A Lowell Sun editorial
DeVille Patrick
Gov. Deval Patrick has a good sense of history, so good that he's taking
his administration back to the good ol' spending days of the Dukakis
era.
Hey, who are we to complain? Those days were good for Democrats and
everyone else on the public payroll and public dole.
So what if the governor wants to spend tax dollars on state police
helicopter rides?
So what if he wants to conduct business from the back seat of a
luxurious Cadillac Coupe de Ville on the taxpayers' dime?
So what if he hires a $72,000 a year scheduler to make sure his wife,
who is a full-time attorney, keeps her public appearances on time?
So what if the state picks up the tab?
It's the Patrick era and you've got to spend money to make money, right?
Or at least that's how one can interpret the governor's glib responses
to questions about the lavish spending in light of the state's $1
billion budget deficit.
As long as the governor delivers, who cares?
And that's the bottom line. He's got to deliver.
So far, Gov. Patrick has been great at telling us what he can't do
rather than what he can do.
Remember all those campaign promises?
After saying he could find $750 million in wasteful spending, and return
those dollars to municipalities, Patrick has changed his tune.
Now the governor wants cities and towns to have the option to raise
revenue through more taxation -- on meals, hotel stays, etc. It's just
what Massachusetts needs, an expanded menu of taxes.
The state has a $1 billion deficit, which Patrick helped along by
reinstituting nearly $400 million in 9C supplemental budget cuts made by
his predecessor, Mitt Romney.
Instead of taking a line-item-by-line-item approach, Patrick approved
the entire spending package of legislative priorities and pork.
While it was a good way for Patrick to build confidence and trust with
the Democrat-controlled Legislature, taxpayers took it on the chin.
OK, it's still early in Patrick's Beacon Hill tenure. He can still make
good things happen.
First impressions, however, are sometimes lasting impressions.
And right now it's DeVille Patrick we're seeing, not Deval.
The Boston Globe
Thursday, February 22, 2007
Having it both ways
By Adrian Walker
Governor Deval Patrick wants you to know he's sorry.
Sort of. Kind of. Maybe not sorry, exactly.
That was the very cloudy message that emerged from his sparring session
with the State House press corps yesterday, as another day of the great
Cadillac Saga unfolded.
We began with high-road Deval: "I spent all weekend trying to make some
very hard choices. And I think it's just impossible to deal with the
choices I'm asking agencies to make without making some of my own."
The contrite tone, alas, survived but a single question. In response to
question number two ("Do you have any regrets?"), things got a bit
surly.
"I am sorry that we have all spent the kind of time we have on what
we've spent time on, and I'm sorry to have been responsible," the
governor said.
In other words, I'm sorry that so many of you need to get a life.
To be fair, he did come right out and say, "Yeah, we screwed up."
Then he went on to defend the decor in his new office, which sounds
lovely indeed, not that I've seen it. He said he was prepared to be a "B.Y.O.
governor -- bring your own furniture."
In due time, he got around to blaming the media, which wasn't a
surprise.
He said he made the decision to pay for the furniture and part of the
car lease because he wanted to get his message out.
"Unless I get this off your screen, I don't think we'll be able to do
that," he said.
I'm on record as not giving a hoot what the governor gets driven around
in. I still think people place too much emphasis on symbols over
substance. At the end of the day, a leased Cadillac is a ridiculous
barometer to measure Patrick by.
What is troubling, though, is Patrick's inability to think any problem
of his has anything to do with him. If everyone could just be as
high-minded, as substantive as he is, everything would be fine.
To that end, he defended his wife's $72,000-a-year scheduler-assistant
as nothing different from other administrations.
"We just happened to call it by name," he said.
Not only is his assertion demonstrably false; it wouldn't meet anyone's
definition of sacrifice.
At his best, Patrick is genuinely high-minded, which is part of his
problem now. When you campaign as the reformer of the culture of Beacon
Hill, you're not supposed to care about drapes and cars. But he does,
clearly.
Patrick said yesterday that when he ran his errands last weekend, when
he went to the cleaners, he got an entirely different kind of feedback
than his coverage would suggest.
I don't know what his neighbors told him at the grocery store. But the
most telling reactions I've heard to these stories have been from people
who describe themselves as supporters, disappointed supporters.
If he thinks the public reaction is purely a media contrivance, he's
mistaken.
The governor spoke yesterday about the budget he is proposing next week,
about getting more police officers on the street, about municipal
relief.
There's no argument here that every one of those issues is more
important than his office decor.
The thing is, Patrick wants it all. He wants to be deep, yet stylish. He
wants to be a populist, just one with an office out of Architectural
Digest. He wants public affection, but public scrutiny makes him
prickly.
There's no such thing as unconditional love in politics.
People, almost all of us, are bundles of contradictions. This town is
full of people who want to help the poor and want to live in a nice
house.
But it may not be possible for Patrick to fulfill all his wishes at the
same time. It's not the car or the drapes; it's the perceived gap
between what he said during the campaign and what he's doing.
His tough choices as governor have probably just begun.
Adrian Walker is a Globe columnist.
The Boston Herald
Friday, February 23, 2007
A Boston Herald editorial
A sorry apology from the governor
In the annals of non-apology apologies, the one offered by Gov. Deval
Patrick this week surely ranks among the most insincere.
Oh, he started out strong.
“I spent all weekend trying to make some very hard choices, and I think
it is just impossible to deal with the choices I’m asking agencies to
make without making choices of my own,” he said.
Sounds about right, when you consider the symbolism alone in purchasing
$12,000 drapes and laying out $72,000 for a full-time staffer to handle
appointments for his wife -- while staring down the barrel of a $1
billion budget deficit.
But just when we were prepared to give him credit for tuning his
political tin ear, the governor pulled out his dog-eared blame-the-media
card.
“I think it’s very important to me that you in the media help me get the
message out about what it is we are concentrating on,” he said. “That is
what the public needs to know about and what it is we are working on,
and unless I get this off your screen, then I don’t think we’re going to
be able to get that done.”
Hmmm . . . how about getting it “off our screen” by not doing it in the
first place?!
The prickly, “how-dare-you” tone may play well with the most devoted of
his devotees. But Patrick is sorely mistaken if he thinks the average
Massachusetts citizen isn’t miffed at the thought of paying for his
gas-guzzling Cadillac and for a full-time staffer to do what at best is
a part-time job for his wife.
And frankly the expenses, while excessive, are now almost beside the
point. Until now Patrick seemed to understand the role of symbolism in
politics -- which explains why the velvet ropes that once shielded the
governor’s office are packed in a closet somewhere. But symbolism is
very much a two-edged sword. And the media didn’t invent that concept.
The Boston Globe
Friday, February 23, 2007
A Boston Globe editorial (at
last!)
Much ado about drapes
Question: When Drew Gilpin Faust moves into Elmwood, the historic,
three-story home of Harvard presidents, will anyone howl if she replaces
the drapes?
Why then has there been such a hullabaloo over Deval Patrick's
redecoration of his office in another late 18th - century architectural
treasure -- the Massachusetts State House?
Some of the answers are obvious: Harvard is private; the government of
Massachusetts is public. Harvard has an endowment of $30 billion plus;
Patrick is looking at a budget deficit next year of $1.3 billion.
Still, each governor should be entitled to dignified surroundings that
reflect his personal tastes. The criticisms this past week of Patrick as
a big spender on personal luxuries have ballooned beyond all
rationality, drowning out coverage of other state issues. He deserves a
better break.
Patrick could have given himself a better break, however, if he had
thought more carefully about some of the expenditures, and if he had
responded quicker and more effectively to the brewing storm.
Use of a state helicopter, for official business, should be perfectly
acceptable for a governor who wants to appear all over the state and not
be stuck in the capital. But the argument for a $1,166-per-month
Cadillac over a Ford Crown Victoria costing just over half as much is
hard to fathom. Similarly, it is perfectly understandable that staffers
in the governor's office would help his wife with correspondence,
scheduling, and other official obligations, but there is no need to
establish a full-time chief of staff for the role.
Patrick's acknowledgement on Wednesday that "we screwed up" was
appealing, as was his decision to pay some redecorating and auto costs.
But he continued, chiding the media for being distracted. "I think it's
very important to me," he said, "that you in the media help me get the
message out about what it is we are concentrating on." This reflects a
faulty view of the role. It is the press's job to report developments,
including significant policy initiatives, whether from the governor or
elsewhere. It is not the press's job to "help" any official.
Patrick will be fortunate if he does not suffer serious erosion in
support from the vast grass-roots following that he built so effectively
in his campaign. He has been openly nurturing this political army in
part so that it can back him in key legislative battles later on. But it
is clear from letters and e-mails that some recent supporters have
quickly become disaffected.
Although tardy, Patrick has taken steps in the last 48 hours to stanch
the bleeding the most effective way possible: by changing the subject.
By asking for federal help for the state fishing industry, by pushing
new local aid initiatives, and by concentrating on next week's budget
submission, he is offering more substantive stories.
The Telegram & Gazette
Friday, February 23, 2007
A Telegram & Gazette editorial
Editorial Footnote
Perfect-pitch Patrick shows signs of tone-deafness
Deval L. Patrick’s recent transformation from a campaigner with perfect
political pitch to a leader showing signs of tone deafness is
surprising, to say the least.
Timing has had a lot to do with it. In swift succession came news of the
governor’s liberal use of a state helicopter, his choice of a high-end
Cadillac as his official vehicle instead of the traditional Ford Crown
Victoria, his use of legislative raises to gain leverage in pursuing his
agenda, the $27,000 refurnishing of his office and, most curious, the
hiring of an ex-campaign fundraiser for the dubious position of
appointments secretary for his wife — all at taxpayers’ expense.
Those issues may not have loomed so large had it not been for the high
expectations that Mr. Patrick, more than anyone, has encouraged. While
crisscrossing the state last summer and fall, he spoke of hope and
change and a new way of governing, but in the few weeks he has been in
office the evidence of such a sea change has been scanty.
In the context of a $26 billion-plus state budget, the perks Mr. Patrick
has claimed are insubstantial. However, they seem somehow symbolic of a
broader nonchalance about fiscal stewardship, manifested in such things
as his wholesale reinstatement of $700 million in budget cuts made by
his predecessor and his resistance to the long-overdue elimination of
tolls on the western turnpike. And he did all of this while warning
state agencies they would have to tighten their belts to close a $1
billion gap in the upcoming budget.
Mr. Patrick has answered some of the criticism by saying he “screwed up”
and agreeing to pick up part of the cost of his official vehicle and new
office furnishings. We’re inclined to take the admission at face value
and chalk up most of the missteps to the freshman jinx that befalls all
political newcomers to some degree. Whether Mr. Patrick is serious about
establishing the new approach to governance he has spoken about will
become clearer with the release of his fiscal 2008 budget next week.
The Boston Herald
Friday, February 23, 2007
Deval tax credit plan ripped by biz critics
By Casey Ross
Attempting to end days of negative headlines, Gov. Deval Patrick
yesterday unveiled a new tax credit for low-income homeowners,
portraying it as a bold effort to deliver promised property tax relief
to Bay State families.
But the plan drew immediate criticism from business leaders and GOP
lawmakers, some of whom sharply denounced its reliance on tax hikes on
businesses. Patrick wants to pay for the homeowner credit by closing
“corporate loopholes,” a term opponents deride as a political euphemism
for a tax increase.
“This is anything but closing loopholes,” said Michael Widmer, president
of the Massachusetts Taxpayers Foundation. “This is a large tax increase
on corporations at a time when the state’s economy is struggling.”
Patrick is planning to file legislation next week that will propose a
number of tax changes affecting corporations. One provision seeks to
implement a policy known as combined reporting, which prevents companies
from hiding profits in out-of-state subsidiaries to avoid taxes.
Patrick said such changes, expected to raise $500 million annually, will
force companies to pay their fair share of taxes, thus giving the state
more money to give back to its residents. The tax credit he is proposing
- to become effective next year -- would provide up to $870 in relief to
single homeowners making less than $58,000 or married homeowners making
less than $70,000.
“The bottom line is the people of Massachusetts have been paying more
and getting less,” Patrick said during a press conference at a
Somerville restaurant. “It’s time that we start to try to turn that
around.”
But critics said the income restrictions on the plan, which mirror those
in place for a senior tax credit already in place, will mean that only 6
percent of the state’s homeowners will be eligible for the new credit.
“The cynical part of me says this is just an attempt to adjust the
headlines,” said state Rep. Brad Jones (R-North Reading), referring to
criticism of Patrick’s Cadillac and high-end office furniture. The
governor rode to yesterday’s press conference in a Chevy SUV instead of
his Caddy.
Jones questioned the need to raise $500 million annually in corporate
taxes when the homeowner tax credit would cost only $75 million a year.
“It’s going to provide marginal relief for a select group of people,” he
said. “It doesn’t show a lot of creativity.”
The Boston Globe
Friday, February 23, 2007
Patrick plan has tax break for homes
Residents could get $870; business levies would rise
By Lisa Wangsness
As many as 100,000 Massachusetts homeowners would receive up to $870 a
year in tax relief under a plan unveiled by Governor Deval Patrick
yesterday that relies on the state's corporate community to foot the
bill.
The new governor, who made property tax relief one of his signature
campaign themes, proposed paying for the $75 million initiative by
eliminating what he said were outmoded tax exemptions businesses have
been exploiting. If the Legislature agrees to all the tax changes, they
would eventually produce about $500 million a year.
"They're gaps; they're cracks in our existing tax structure that clever
accountants and lawyers -- and I used to employ them when I was in
business -- use to aggressively avoid paying their fair share," he said,
addressing a group of business owners, local leaders, and homeowners
over lunch at Amelia's Kitchen. "We want to take the squeeze off of
municipalities and you."
Reaction was mixed in the Legislature, where many lawmakers share
Patrick's desire to ease the burden on property owners but are loath to
do anything that could be construed as imposing new taxes on businesses.
Representative Daniel E. Bosley, a Democrat from North Adams and
cochairman of the Joint Committee on Economic Development and Emerging
Technologies, said Patrick was "on the right path," but that he would
prefer to see an expansion of the state's earned-income tax credit,
which would benefit the neediest residents regardless of whether they
own homes. He added that he was concerned about the economic impact of
eliminating the so-called loopholes.
"I applaud the fact that he wants to standardize our corporate tax
policy and have everyone pay their fair share, but you can't entice
businesses here if they don't know what our tax policy is going to be
next year," Bosley said. "Every year we're closing loopholes, and good,
bad, or indifferent, those loopholes are part of the business balance
sheet."
Outside the State House, advocates and budget analysts had sharply
opposing views of the plan.
Geoffrey Beckwith, executive director of the Massachusetts Municipal
Association, said the property-tax measure would complement the
municipal relief package Patrick introduced last week, which would allow
communities to raise small local levies on meals and hotel rooms as part
of a plan to reduce cities' and towns' reliance on the property tax and
help subsidize property tax relief for low-income seniors.
"The property tax is a major drag on our state's economic future, and we
have to diversify municipal revenues and provide creative ways to lessen
the burden on homeowners and residents, so that we can create a much
more economically robust platform to build on," he said.
Michael Widmer, president of the business-backed Massachusetts Taxpayers
Foundation, was scathingly critical of Patrick's plan.
"The proposal provides limited property tax relief at a high cost to the
Massachusetts economy," said Widmer, adding that it would be
economically destructive to ask corporations to take another $500
million hit on top of the $400 million they had to pay after the Romney
administration closed other so-called loopholes and a $600 million
increase in unemployment insurance taxes in 2004.
"Cumulatively, you're talking about $1.5 billion annually in additional
taxes at a time when our economy is weak, 150,000 jobs below where we
were in 2001," said Widmer, whom the Legislature often turns to for
budget analysis. "This adds significantly to the competitiveness
disadvantage facing Massachusetts businesses."
Patrick, who returned to policy after a week spent mired in controversy
about his spending, said property tax relief is critical to retaining
workers and revitalizing the state's economy.
His plan would create a "homeowner circuit breaker" that would offer
individuals who meet income guidelines a credit on their income taxes
for the amount by which their property tax, sewer and water bills exceed
10 percent of their income, up to $870 a year. A similar benefit is
already available for taxpayers 65 and older.
The income limits to qualify for the program would be $46,000 for
individuals who have no dependents, $58,000 for heads of household
(individuals with dependents), and $70,000 for married couples who file
jointly.
The property in question must be worth no more than $684,000.
At $870, the credit would represent a nearly 25 percent break in the
average statewide property tax bill of $3,800, the governor's office
estimated.
The circuit breaker would take effect Jan. 1, 2008, but would cost
little until the spring of 2009, Patrick aides said, when most taxpayers
would file their 2008 income tax returns.
Aides to Patrick said the governor would pay for the plan by closing
seven corporate tax loopholes worth $295 million in fiscal 2008 -- they
would take effect halfway through the fiscal year -- and $500 million in
fiscal 2009. The remainder of the money would be used to help offset a
more than $1 billion gap between expected revenues and costs next fiscal
year.
The Legislature could approve the property tax relief plan and reject
the corporate tax changes, but then would have to come up with an
alternative funding source.
Patrick is scheduled to present his budget in an address at 7:30 p.m. on
Tuesday at Soldiers and Sailors Memorial Hall in Melrose.
Senator Steven C. Panagiotakos, vice chairman of the Senate Ways and
Means Committee, said he was fundamentally in agreement with the
governor about the pressing need to lower property taxes.
"I'm going to be looking at this with great interest and hopefully
support, once we find out all the details," he said.
Senate minority leader Richard R. Tisei, a Republican from Wakefield,
congratulated Patrick for trying to find ways to reduce the property
tax, but said "the devil is going to be in the details" when it comes to
closing loopholes.
"I would be interested in looking at each one of these loopholes on a
case by case basis," he said. "Will it leave Massachusetts more
affordable or less affordable compared to other states?"
The Boston Herald
Friday, February 23, 2007
Gov can still right those rookie errors
By Virginia Buckingham
Apology accepted. Now, Gov. Patrick, let’s start over, shall we?
Some 50 days have elapsed since the new governor took the oath on the
Butler bible. That means he has another 50 days until the traditional
“first 100 days” assessment by the media and the public about the
administration.
In politics, that’s a lifetime. So, come April 14 or thereabouts, those
100-day stories will, of course, mention the early stumbles over the car
and the furniture.
But the new governor can rewrite the lead. Ideally, it will read
something like this: “Recovering from some initial rookie mistakes, Gov.
Deval Patrick rebounded with several bold proposals and won a resounding
legislative victory on the core promise of his campaign, cutting
property taxes.”
In other words, Patrick can easily recover from any recent missteps.
Wednesday’s apology was a start. However, yesterday’s puny property tax
relief plan, funded by massive corporate tax hikes, does little to help
Patrick’s cause. Here are some thoughts on what to do next.
Propose real property tax reform that won’t cost the state a dime.
Taking a page out of Citizens for Limited Taxation’s book,
Patrick can suggest allowing voters to place an underride on their local
ballot, empowering them to cut their own taxes if they so choose. Also,
he can propose that override votes only be held on the date of the
biennial election, instead of whenever municipal leaders feel like it.
This will empower everyday citizens, and put them on a level playing
field with the special interests which turn out in special elections.
Get a commitment from legislative leaders to pass the property tax
plan in the next 50 days. Patrick needs a lifeline. Senate President
Robert Travaglini and House Speaker Sal DiMasi should be happy to throw
one to their fellow Democrat.
Make good on Patrick’s other campaign promise. Somehow, fiscal guru
Leslie Kirwan can make room in the budget for a good chunk of those
1,000 new cops. Heck, if Patrick’s going to raise corporate taxes
anyway, what better way to make use of the new revenue than securing a
corporate commitment to public safety? (I can picture a few CEOs on some
street corner in Boston with the new governor and Mayor Tom Menino
applauding this better use of their profits.)
File a boffo balanced first budget. It should contain a bare minimum
of outside sections which represent the worst of insider dealing at the
State House and no gimmicks. (Kirwan knows how many times governors have
tried -- and failed -- to sell the state transportation building.)
Then Patrick should ask himself what else he wants to achieve.
After all, regardless of whether voters consciously focused on it, they
voted for radical change in November and, therefore, a radically changed
approach to the role of government.
What does Patrick think the role of government is? He should apply his
answer to education, public safety, welfare, job creation, Medicaid,
transportation and so on.
For instance, universal preschool is a much cherished goal. Patrick
should commit to making it happen over five years, 10 years, whatever is
reasonable and then fight for it.
Then, just to keep folks off balance (and keep independents and
conservative Democrats in his coalition) Patrick should adopt some
Clintonesque positions like mandatory school uniforms or school
vouchers.
Do just some of this and on the 100-day report card, Patrick will have
earned a solid B. And next thing you know, they’ll be calling him the
new comeback kid.
State House News Service
Thursday, February 22, 2007
Patrick details $75M property tax break,
looks to attract $500M in biz taxes
By Priscilla Yeon, Jim O'Sullivan and Michael Norton
Gov. Deval Patrick today proposed a property tax break that would be
available to 100,000 families next year and funded by changing tax laws
that the administration says offer "unintentional and unfair benefits"
to businesses. The corporate tax breaks targeted for closure are worth
$500 million.
The new "homeowner's circuit breaker" property tax break, if adopted by
the Legislature, would be implemented Jan. 1, 2008 and would require $75
million to finance in the fiscal 2009 budget.
Sitting at a long table at Amelia's Kitchen in Somerville, where he
lunched with local officials, homeowners and small business owners,
Patrick said people he met throughout his campaign last year demanded
property tax relief. He said in the last seven years, the average
family's property tax bill has gone up by $900.
"The bottom line is that people in Massachusetts have been paying more
and getting less," said Patrick. "And it is time, I believe, for us to
start to turn that around."
Before leaving for a weekend of meetings with governors in Washington
D.C., Patrick also announced he'll form a study group next week to
examine the state's "antiquated tax structure" with an eye towards
strengthening the ability of businesses here to compete globally. The
corporate tax loophole-closing bill will also be filed next week.
To pay for the proposed expansion of the Homeowner Circuit Breaker,
Patrick plans to close corporate tax loopholes, calling such provisions
"gaps that some companies are avoiding to pay for their fare share."
According to the Patrick administration, the corporate tax loophole bill
will generate $295 million in revenue in Fiscal 2008 and $500 million in
Fiscal 2009. Business groups, which say the climate for new jobs in
Massachusetts needs help, are expected to lobby heavily against the
governor's plan.
There are seven new changes to close the corporate tax loophole, said
Patrick. One provision would generate $136 million in revenue by curbing
the business practice of shifting income to out-of-state subsidiaries to
avoid Massachusetts taxes. Another change, estimated to yield $99
million in new revenues, includes requiring businesses to "check the
(same) box" or conform their corporate identity between the state and
federal tax returns.
Requiring that Internet resellers pay hotel and motel room occupancy
taxes would produce $5.6 million for the state and $4 million for
municipalities. Ensuring that businesses pay the full sales tax on
leased equipment could generate some $28 million.
John Regan, vice president for government affairs at the Associated
Industries of Massachusetts, called the proposals bad for the economy.
"Let's not scratch our heads and wonder why we're not creating jobs,
OK?" Let's not pretend we don't know why," Regan said. He added, "You've
got our tax code bouncing all over the place, you further the perception
of Massachusetts as an unstable place to invest."
Michael Widmer, president of the business-backed Massachusetts
Taxpayers Foundation, said businesses have been paying $1 billion
annually in new taxes for the last four years.
"The major flaw in the proposal is that the state will sacrifice jobs in
order to provide limited property tax relief," Widmer said. "The
corporate tax proposals are major changes. They are anything but
loophole closings."
Widmer said the corporate tax changes would place businesses in the
state at a competitive disadvantage. Only a quarter of the country has
adopted the changes Patrick is proposing, he said.
In a statement, Paul Guzzi, CEO of the Greater Boston Chamber said:
"Imposing business tax increases is wrong for the people of
Massachusetts. We have increased corporate taxes by more than $800
million annually over the past four years, while competitor states are
working to make their corporate tax structures more competitive -- and
we're down 140,000 jobs since 2001. We need to create a climate in which
employers can create jobs here in Massachusetts -- not inflict further
damage to our economy."
Asked if he is concerned his proposed corporate tax changes would
discourage large companies from moving to Massachusetts, Patrick said:
"Of course I'm concerned about that. I want to encourage companies to be
here. But the loopholes we're talking about really put us in line with
many of our competitors." He said a telecom property tax exemption he
has proposed lifting, for example, is not a loophole, it is a measure in
existence since 1915.
The Massachusetts Budget and Policy Center, which has extensively
analyzed corporate tax laws and urged adoption of bills closing
loopholes, has had some conversations with members of the Patrick
administration, according to Executive Director Noah Berger.
"Looking carefully at the tax code to make sure it's as fair and
efficient as possible is very important and the problem of tax avoidance
by multi-state companies is an expensive problem that it makes sense to
try to solve," Berger said.
The "homeowner's circuit breaker" proposed by Patrick would qualify
those eligible for a state tax credit of up to $870 per year, or nearly
25 percent of the average statewide property tax bill of $3,800. Those
eligible would include individuals who earn up to $46,000 a year who are
not heads of a household, individuals earning up to $58,000 a year who
are heads of households, and married couples filing jointly who earn up
to $70,000 per year. The credit would cover household's property tax
payment, including water and sewer bills, that exceeds 10 percent of the
owners' income.
House Minority Leader Brad Jones (R-North Reading) said he appreciates
Patrick's effort to provide property tax relief, as discussed in his
gubernatorial campaign, but there are questions about the plan, he said.
"That being said, he delivered limited relief to a small pool of
people," said Jones, who said if the circuit breaker program only starts
in January of 2008, people can only see some relief in 2009 when filing
their tax returns. "Why not have this plan take effect for July of
2007?"
He also questioned why Patrick is proposing relief of $75 million when
the corporate tax changes are estimated to bring $500 million a year.
"Then the question is, why aren't we doing more broad-based relief?"
said Jones.
Patrick said "we have plans" to use the additional revenue from the
corporate tax loophole. He said he would disclose more details on his
plans next week but mentioned closing the budget deficit and increasing
policing to communities as some of his proposed measures.
Patrick last week proposed a municipal partnership plan that also
features some tax relief. That plan would ease residential property tax
burdens by lifting a property tax exemption that aides now say is worth
some $78 million to the telecommunications industry.
The initial estimate of the telecommunications property tax exemption
elimination was $140 million. A Patrick aide said the revised estimate
of new revenue from the telecommunications tax loophole closing stemmed
from a new calculation of a two-year-old figure and from a recent court
ruling. The significant change in the projection is due to communities'
ability to tax wireless equipment, and the depreciation in value of
older equipment, the aide said.
Patrick's partnership bill also allows municipalities to impose taxes on
people eating in restaurants and staying in hotels and extend commercial
property tax increases that are currently due to sunset. Patrick's muni-plan
would require cities and towns that adopt local taxes to set aside 25
percent of revenues for senior citizen property tax abatements.
Patrick said the local options tax would allow cities and towns to
impose "a modest" meals and lodging increase and suggested a 1 to 2
percent tax increase, he added.
The governor's efforts to generate new revenue face uncertain fates in
the Legislature. On Thursday, the House diced his municipal financing
plan into five different pieces, all sent to different legislative
committees.
"Deval's wrong," said one House Democrat who endorsed Patrick early in
the campaign. "Let him go out and educate the public and build the
momentum for local options taxes." The House member said Patrick's
strategy of introducing the new revenue source so early in his term
would backfire with the public, once again painting Democrats as the
party of taxing and spending.
House Speaker Salvatore DiMasi has expressed hesitation about the local
option meals and lodging tax.
Patrick said he planned to try to "make the case" to legislators to
garner support. "I'm sensitive to the Speaker's concerns, and his
concerns are shared by others." Patrick later said: "This is an option
for local communities, this is not about the state saying what to do."
Patrick said while the local options tax may work in Somerville, it may
not work in Milton, his hometown, where there are so few restaurants.
And in their hometown newspaper, the Worcester Telegram & Gazette, Lt.
Gov. Timothy Murray, that city's former mayor, and the dean of its
delegation, House Revenue Committee chair Rep. John Binienda, have
warred over tax policy. After Binienda threw cold water on Patrick's
plan to strip the telecom exemption and allow local option taxes, Murray
shot back, "We need legislators who are going to stand up for homeowners
and small businesses that are overburdened by property taxes, instead of
legislators who are more worried about the telecom industry and their
lobbyists."
Amelia's Kitchen property owner Binoj Pradhan is a Somerville resident
and said he is in favor of the meals tax of 1 to 2 percent.
"Whatever the government thinks is best, it would work for us," said
Pradhan.
Rep. Carl Sciortino, a Somerville Democrat who attended the luncheon,
said his city has a lot of mom-and-pop stores, whose owners live locally
and therefore support property tax relief.
The Boston Globe
Friday, February 23, 2007
Businesses blast governor's tax plan
Foes say jobs, not just loopholes, are what's at stake
By Peter J. Howe
Governor Deval L. Patrick is looking to companies to cough up nearly
$800 million more in tax payments over the next two years, through what
he calls "closing loopholes." But businesses call the seven proposed
changes job-killing tax increases.
Dollar-wise, the biggest change by far would be a move to so-called
combined reporting, a method of imposing state taxes on multi-state
corporations that California and 14 other states use.
Aides to Patrick expect such a system to bring in $136 million in new
revenue during the year beginning July 1; based on 2004 tax returns, at
least 2,300 of the 149,000 corporations that pay state taxes would be
affected, according to a Revenue Department spokeswoman.
The only proposal Patrick floated yesterday that had not been previously
reported involves hotel and motel taxes on rooms booked online. Many
travel websites, including Priceline.com, Hotels.com, and airline-hotel
booking sites, buy blocks of rooms at discounted wholesale rates, then
mark them up for resale to consumers.
Patrick would force them to pay state and local hotel taxes on the
retail room rate, not the wholesale, which the governor's budget aides
contend would yield $5.6 million for the state next year and $4 million
for local governments.
Patrick's predecessor, Republican Mitt Romney, attempted to make the
same change during three rounds of corporate tax changes in his term,
but backed off after Internet interests pummeled him with radio ads
about an "Internet tourism tax."
Art Canter , president of the Massachusetts Lodging Association, said
Romney and Patrick followed the lead of several other states, but "to
date, nobody's been able to do it" because of the complexities of
federal Internet taxation policy, as well as the political backlash.
"We have other ways for them to generate revenues without creating new
taxes," Canter said, including imposing hotel taxes on companies that
specialize in short-term "corporate rentals" of condos and on summer
vacation-home rentals.
The five other changes Patrick said he will seek from the Legislature
are:
Requiring that companies claiming a certain corporate structure when
"checking the box" on federal tax returns file the same way in
Massachusetts, and not claim a lower tax rate for being a "business
trust" or other entity. That would generate $99 million in fiscal 2008,
the administration said. About 3,566 Massachusetts businesses, based on
2004 tax returns, would be affected.
Making big companies that lease capital gear from subsidiary "captive
leasing companies" pay sales tax, worth $28 million.
Mandating that insurance companies pay standard corporate tax rates, not
lower insurance company rates, on noninsurance affiliates, worth $14
million.
Imposing a tax when businesses sell an ownership interest in an entity
that owns buildings or land, not the actual underlying real estate, $12
million.
Reducing the "earned income credit" for low-wage workers who live in
Massachusetts but work in another state, or work here and live in
another state, $2 million.
Overall, the administration expects the changes to yield about $295
million the first fiscal year and $500 million the second year.
Patrick is looking to raise more revenue from businesses largely to
close a $1 billion budget gap for this coming year, and to help fund a
program unveiled yesterday to give state income tax credits to
lower-income homeowners. The goal is to offset property taxes and
water-sewer bills.
The governor, meeting with local officials and reporters in Somerville,
said he has no plans to go after investment and research and development
tax credits. "What we're talking about today is nothing like that.
They're gaps, they're cracks in our tax code that clever accountants and
clever tax lawyers use -- and I used to hire them when I was working in
the corporate world -- to avoid paying their fair share," Patrick said.
Business interests vow to battle Patrick's plans in the Legislature,
insisting they aren't loophole-closings but clear-cut tax increases.
John Regan, vice president at Associated Industries of Massachusetts,
the state's biggest business lobby, said that combined with Romney's
three waves of corporate tax changes, the Patrick moves mean "we're
looking at $1 billion more in taxes levied on the business community.
The impact of that on job-creation is going to be significant."
Regan said the measures also discourage businesses because they signal
chronic uncertainty about state taxes. "It sends a message that our tax
code is like the weather: Wait a year, and it changes," Regan said.
Patrick said he will convene a business-labor-academic task force to
reevaluate the state's overall tax regime. But Paul Guzzi, Greater
Boston Chamber of Commerce president, said, "Proposing tax-law changes
before the tax commission is created is putting the cart before the
horse."
The governor drew support, however, from Massachusetts AFL-CIO president
Robert J. Haynes: "It is refreshing to have a governor who understands
that we all have a role to play in supporting this Commonwealth, and
that corporations have as much responsibility to pay for the essential
government services they benefit from as individuals do.
"Our hard-working members and their families can't cherry-pick which
taxes they want to pay or not pay, and corporations shouldn't be able
to, either."
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