CLT UPDATE
Thursday, February 7, 2008
"More Is Never Enough" but
revolution is in the air
State tax revenues will grow below 4 percent next
fiscal year, to $20.987 billion, Patrick administration officials and
lawmakers agreed Tuesday ...
Budget writers have predicted a structural deficit next year well north
of $1 billion, much of the gap created by spending pressures that are
outpacing revenue growth.
The off-budget commitment for the MBTA would hit $768 million, a $12
million increase over the set-aside for the current fiscal year. The
School Building Assistance account would receive $702 million, nearly
$70 million over this year. Pension transfers are marked for $1.465
billion, a $66 million increase but with no changes to funding
schedules. That would leave the amount of tax revenue available for the
fiscal 2009 budget at $18.052 billion.
State House News Service
Tuesday, January 8, 2008
State officials agree,
peg revenue growth below 4 percent
Tax collections in January totaled $2.2 billion and surged
7.2 percent over collections during January 2007.
Receipts through the first seven months of fiscal 2008 are now running 4.8
percent ahead of the comparable period a year ago, and $511 million above the
benchmark used to draft this year’s state budget.
State House News Service
Monday, February 4, 2008
January tax receipts shoot up 7.2 percent
Patrick's plan would raise taxes on business by nearly $300
million in the next fiscal year and $490 million a year after that. Are you sure
this is the moment, governor? ...
His transparent goal is not to make the tax system fairer and simpler, but
rather to raise new revenue to pay for his laundry list of new initiatives, from
increasing spending on education by $368 million to ending homelessness to
upgrading the state parks - all worthy goals. I'd like a new car, too, but I
can't afford it right now.
The Boston Globe
Wednesday, January 23, 2008
Deval's bad timing
By Steve Bailey
Christmas has come and gone. The new year is here. So it's
time again for that annual bit of municipal performance art in which doe-eyed
children are brought before the public and threatened with gibbeting if stingy
taxpayers refuse to pony up more cash....
Note that in budget-speak, level-funding means getting 6.6 percent more money
than you did the previous year and getting 2.4 percent more is a drastic cut.
How so? Because it isn't as much more as you wanted.
Many taxpayers wish their paychecks had received such a "drastic cut." ...
The teachers are demanding more money. The superintendent is demanding more
money. But the town doesn't have any more money....
Drama plays well in the school theater. But selling an override to a skeptical
public takes hard-edged financial analysis.
An Eagle-Tribune editorial
Sunday, January 13, 2008
Andover school budget needs analysis, not drama
As Andover teachers turn up the public pressure for a new
contract, a group of residents is proposing a $5 million property-tax override
to solve Andover's operating budget woes....
The group, which consists of roughly a dozen Andover residents - the majority of
whom are involved in town parent-teacher organizations, according to Pennington
- submitted the articles in hopes of closing an operating deficit currently
projected between $2.6 million and $3.5 million for fiscal year 2009, which
begins July 1....
Selectmen Chairman Brian Major said a $5 million override would cost the average
homeowner in Andover $350 more on his annual property tax bill....
Another reason for the $5 million number, according to Pennington, is the
group's concern about how town employee salary increases in future contract
settlements will affect operating expenses. All town and school department
contracts with employee unions expired on July 1, 2007....
Because about 80 percent of the school department's annual budget is
salary-driven, Pennington said delaying the finalization of contracts would only
add to the uncertainty of the town's fiscal future.
"That's a major concern," said Pennington. "If you don't have anything in there
for a contract, then if you sign the contract, what are you going to do if
there's no room (in the operating budget)?" ...
The other two of the group's proposals scheduled to be on the warrant include
exploring options that would call for transferring reserves to cover operating
expenses, a move Major called "very dangerous."
"They're looking to take one-time savings accounts and spending them on
operating costs," said Major. "All of a sudden you're growing the problem.
You're putting it off by one year. That's a dangerous, dangerous precedent.
People should be up in arms."
The Andover Townsman
Thursday, January 17, 2008
Override, contract talks frame budget debates
Questions are being asked that deserve answers. If officials
were unaware before, they have to know now that the public has had enough, and
many aren't going to take it anymore.
"I have a warm feeling in my heart for Sudbury taxpayers who are going through
what we are all going through," Barbara Anderson, director of Citizens
for Limited Taxation, recently told our Sudbury reporter. "We all have to
pay more for fuel, transportation and other inflation items. But the cities and
towns keep wanting us to come up with more money - in excess of Prop 2˝. The
educational establishments have to face reality. Most of the problems seem to
come from the education budget."
Like it or not officials, those are the realities of 2008.
The Milford Daily News
Sunday, January 20, 2008
Signs of a tax revolt?
By Jeff Adair
The Massachusetts Taxpayers Foundation is out with its 37th
annual "Municipal Financial Data" booklet. No need to read between the lines; a
glance at the densely packed rows of figures reveals the truth of what most
mayors and selectmen are telling us - cities and towns are up against it
financially.
And in a release announcing publication of its latest summary of tax rates,
spending patterns and revenue trends for all 351 of the commonwealth's
municipalities, MTF notes, "A variety of factors is placing ever greater
pressure on the finances of most cities and towns with little relief in sight."
...
"Without a more dependable revenue stream and decisive action to address health
care costs, there will be acceleration of the cuts in programs and services that
have already impacted a large number of communities," the MTF report concludes.
Voters want such action, as Gov. Deval Patrick noted in his State of the State
speech last week, but not if that action is going to result in an increase in
their taxes or cost them their jobs. The action they seek, but which the
governor and legislative leaders have failed to deliver thus far, is an end to
public-sector practices such as those that allow employees accused of even the
most heinous crimes to spend months, even years, on paid leave; that allow too
many to retire too early on bloated pensions; and that reward employees for not
cheating on their sick leave.
Increased taxes won't fly so long as taxpayers feel ripped off by the system....
The last thing Patrick and legislative leaders want is for voters to force
reform of some of these wasteful practices via the ballot box. But without
meaningful action - an easy one would be removing the provision giving union and
retirees veto power over a community's ability to buy lower-cost health
insurance through the state - some sort of taxpayer revolt is inevitable.
An Eagle-Tribune editorial
Tuesday, January 28, 2008
Higher taxes are not an option
We need to control costs where we can, because the rest of
the budget balancing — for this year and the years ahead —
requires asking the public for more money.
As Michael Widmer, president of the nonpartisan Massachusetts Taxpayers
Foundation, told me during a long conversation last week, "Without additional
funds, we simply won't have sufficient revenue over the long term —
with or without casino money — to maintain even the current level of
services."
There are a number of tax increases that I think we ought to consider. If
implemented together, and coupled with the various money-saving reforms that are
possible, they form a politically fair package that asks something of everybody,
but asks more of those better able to contribute.
The Salem News
Wednesday, February 6, 2008
The case for raising taxes:
More revenue needed to keep government functioning
By Brian T. Watson
With the House poised to vote Tuesday on a key exemption to
Proposition 2˝, one of the property tax law’s principal architects is warning
that loosening the rules could undermine the purpose of the 26-year old process.
Barbara Anderson, president of Citizens for Limited Taxation,
blasted a proposal (H 2480) that would enable municipalities to exempt certain
elderly voters from the tax increases that result from override vote, calling it
a less-than-subtle effort to keep seniors away from the polls.
“We’re very concerned about this bill,” she said Monday. “Especially in a year
when property taxes are high enough and we’re all waiting for our property tax
relief.”
Anderson challenged Gov. Deval Patrick to veto the bill, should it reach his
desk, saying anything less would be “a further violation of his promise” to
lower property tax burdens.
State House News Service
Tuesday, February 5, 2008
Proposition 2˝ leader blasts tax bill
due before House
With a string of recent organized-labor outrages, what was
once a fairy-tale notion in Massachusetts — hard-core union-busting — may become
a reality in today’s dire fiscal times. All we need is the right demagogue....
Formed to prevent the powerful from preying upon the powerless, our public
employee unions have themselves become the powerful — their incessant wails for
“fairness” are minor masterpieces of Orwellian doublespeak — and it’s the rest
of us who are powerless against the flabbergastingly senseless status quo they
spend their days defending. With municipalities more reliant on rising property
taxes than they’ve been in 25 years, and unions squashing anything that would
help cut costs or increase efficiency, I started to wonder whether we’re
approaching a time when voter anger will outweigh union clout, and politicians
will be able to take a stand without being carted off in pails afterward.
Boston Magazine
December 2007
Fate of the Unions
By Joe Keohane
Chip Ford's CLT Commentary
The sky is falling. Or is it? "State tax
revenues will grow below 4 percent next fiscal year," we were told on
January 6th -- but a month later it was reported, "Tax collections in
January . . . surged 7.2 percent."
Still, government needs more of our money regardless.
"Patrick's plan would raise taxes on business by nearly $300 million in
the next fiscal year and $490 million a year after that," Boston Globe
business columnist Steve Bailey wrote -- because Gov. Patrick wants to
spend billions more on a dream list of new government spending programs.
Some tax-and-spenders are actually talking up
broad-based state tax increases, even of resurrecting the graduated
income tax scheme defeated by the voters five times over the past three
decades. That's the tactic, if ever adopted, by which the
Legislature would divide-and-conquer taxpayers one tax bracket at a
time.
One of them wrote in his recent column: "As
Michael Widmer, president of the nonpartisan Massachusetts Taxpayers
Foundation, told me during a long conversation last week, 'Without
additional funds, we simply won't have sufficient revenue over the long
term -- with or without casino money -- to maintain even the current
level of services.'" The so-called MTF has always supported higher
taxes -- extracted from us average taxpayers, just not on its Fat-Cat
Big-Business membership.
Patrick campaigned on property tax relief -- instead
of rolling back the income tax as a large majority of voters mandated in
2000. Have you seen any of his promised property tax relief yet?
Does anyone still expect to?
What became apparent over especially the past year
was who and what is bankrupting taxpayers and governments state and
municipal alike:
Insatiable
public employee unions and the "fixed costs" that increase contract
negotiation after negotiation. The problem has been well-exposed,
and the solution is apparent. All that's necessary now is for our
elected officials to find the courage to do it now, before everyone and
everything is bankrupt, do what must be done inevitably.
Joe Keohane laid it out most comprehensively in the
December issue of Boston Magazine, in his must read article "Fate
of the Unions." In conclusion he ponders "whether we’re
approaching a time when voter anger will outweigh union clout, and
politicians will be able to take a stand without being carted off in
pails afterward."
Most now recognize this reality at last, the public
and media alike. How far behind can our "leaders" be?
Talk is now turning to an approaching tax revolt if
public employee union greed is not smothered, if taxpayers are required
to continue shouldering ever-growing burdens so public employees can
continue living lifestyles their employers can only dream about. When that revolt
ignites, you and CLT will be ready again as its ground troops -- to take
back what is ours.
 |
|
Chip Ford |
State House News Service
Tuesday, January 8, 2008
State officials agree,
peg revenue growth below 4 percent
By Jim O’Sullivan
State tax revenues will grow below 4 percent next fiscal year, to
$20.987 billion, Patrick administration officials and lawmakers agreed
Tuesday, but the pending deficit is deep enough that next year’s budget
should include casino licensing fees, said the top Senate budget author.
Sen. Steven Panagiotakos said he hopes that Gov. Deval Patrick includes
casino licensing fees, which could result in $800 million, in the
blueprint he must file by Jan. 23. House leaders have warned Patrick not
to include those in his bottom line since the issue of legalizing
casinos is still up in the air.
“My feeling is that anything that can move the debate I’m in favor of,
and I think that will help move the debate,” said Panagiotakos
(D-Lowell), intensifying his support for casino revenue use.
A spokesman for Panagiotakos said it was too soon to speculate whether
the casino licenses would be a factor in the Senate budget plan.
The $20.987 billion estimate matches one that Patrick’s budget chief,
Leslie Kirwan, released in October. On Tuesday, Kirwan, Panagiotakos,
and House Ways and Means chair Robert DeLeo, announced in a joint
statement that they had settled on the figure, which represents a 3.8
percent growth clip.
Budget writers have predicted a structural deficit next year well north
of $1 billion, much of the gap created by spending pressures that are
outpacing revenue growth.
The off-budget commitment for the MBTA would hit $768 million, a $12
million increase over the set-aside for the current fiscal year. The
School Building Assistance account would receive $702 million, nearly
$70 million over this year. Pension transfers are marked for $1.465
billion, a $66 million increase but with no changes to funding
schedules. That would leave the amount of tax revenue available for the
fiscal 2009 budget at $18.052 billion.
The forecast is crucial to budget-writing, and was hashed out after top
state officials interviewed experts, and conducted their own
negotiations. Revenue estimates in the last several years have hung well
below actual revenues, allowing surpluses that can be used for mid-year
spending initiatives and for the coverage of non-recurring revenues and
unexpected spending.
Last January, administration and legislative leaders agreed tax intake
would climb roughly 3 percent in the current fiscal year, for a
consensus revenue estimate of $19.879 billion. The Department of Revenue
reported last week, halfway through fiscal 2008, that tax collections
were 4.2 percent ahead of the first half of last fiscal year, $422
million above the original FY ’08 benchmark, which was revised upward by
$400 million in October.
Whether the state should beef up its available revenues has shaped up as
the most important question on the Hill. Patrick is insistent that it
should, with less-vocal backing from Senate President Therese Murray,
but House Speaker Salvatore DiMasi’s opposition has so far been fixed.
Panagiotakos said the state is likely facing a $240 million hole in
Lottery aid from the current and last fiscal years, that will need to be
filled from the general operating account and is likely to recur, along
with health care costs running $150 million higher than estimated. As a
result, he said, the state would likely have to pull down reserves to
balance its budget or use unexpected tax revenues from this fiscal year
to balance the budget.
That predicament, he said, argues for bolstering revenue intake.
The House, which will receive Patrick’s House 1 budget later this month
before making changes and passing it on to the Senate, is poised to
reject gambling revenues.
DiMasi spokesman David Guarino, “We’d prefer if the governor used
revenues … that he knows are available, rather than ones he hopes are
available.”
State House News Service
Monday, February 4, 2008
State Capitol Briefs
January tax receipts shoot up 7.2 percent
Tax collections in January totaled $2.2 billion and surged 7.2 percent
over collections during January 2007.
Receipts through the first seven months of fiscal 2008 are now running
4.8 percent ahead of the comparable period a year ago, and $511 million
above the benchmark used to draft this year’s state budget.
Income tax collections in January were up 16 percent, offsetting an $8
million over-the-year drop in monthly sales tax collections. Corporate
tax collections totaled only $5 million for the month, falling $24
million shy of the January benchmark. The Department of Revenue
announced the collection numbers Monday afternoon.
The Boston Globe
Wednesday, January 23, 2008
Deval's bad timing
By Steve Bailey
Deval Patrick unveils his second state budget today. He better have a
Plan B in his back pocket.
If the governor has not noticed, a recession is upon us. Yesterday,
there was wholesale panic in the markets, abroad and at home, which were
both comforted and alarmed by a surprise interest rate cut of
three-quarters of a point by the Federal Reserve. So worried about the
danger ahead, Congress is suddenly making all kinds of strange
bipartisan noises about putting together an aggressive stimulus package
- and quickly. The discussion is all about tax rebates or grants for
individuals and tax cuts for business.
Governor Patrick, by contrast, is proposing a large tax increase for
business as part of his plan to close a billion-dollar budget gap. His
timing could not be worse. A tax increase should be dead on arrival on
Beacon Hill.
Last month, when all those decidedly mixed "Governor Patrick at Year
One" analyses were being written, the administration was proclaiming its
job-creation record as a major talking point. Now the numbers are in:
Massachusetts added about 24,000 jobs in Patrick's first year, nearly a
third fewer than the 35,000 jobs added in Mitt Romney's final year. The
state lost 2,700 jobs in December, and the unemployment rate rose to 4.5
percent from 4.3 percent. "Mission Accomplished" it is not.
The economic news is grim everywhere; Massachusetts is no exception.
Here is a sampling of headlines from Friday's Globe Business section, in
case the governor was out of town on the campaign trail: "Slowing Mass.
economy costs jobs" . . . "Soaring electricity prices leave state's
manufacturers struggling" . . . "Bankruptcy looms for furniture chain" .
. . "State seizes ice cream firm over back taxes," and insult to injury,
"Fidelity grows in Albuquerque."
Patrick's plan would raise taxes on business by nearly $300 million in
the next fiscal year and $490 million a year after that. Are you sure
this is the moment, governor?
One of Patrick's earliest initiatives was to target the closing of
so-called corporate tax loopholes. Although the economy has deteriorated
considerably since then, the governor remains right on the policy. As
now written, the tax codes allow big multistate corporations to game the
system, shifting profits to low-tax states like Delaware.
More than 20 states now use what is called combined reporting to counter
this income-shifting game; Massachusetts should do the same. The changes
would make the tax code simpler and fairer, both good things. And
Massachusetts could do this without raising taxes on business by
significantly lowering the state's high (9.5 percent) corporate tax
rate, thus keeping the changes revenue neutral.
That, however, does not suit Patrick's needs. His transparent goal is
not to make the tax system fairer and simpler, but rather to raise new
revenue to pay for his laundry list of new initiatives, from increasing
spending on education by $368 million to ending homelessness to
upgrading the state parks - all worthy goals. I'd like a new car, too,
but I can't afford it right now.
Last year, House Speaker Sal DiMasi made short work of Patrick's
business tax hikes by shipping them off to a study commission. A year
later, with a recession of uncertain depth and duration upon us, DiMasi
is looking smart. These proposals could benefit from another year's
study in North Adams or beyond. Said DiMasi yesterday: "What burden do
we put on business during a recession?"
Governor Patrick has an ambitious agenda. Unfortunately, right now he
looks like a governor more suited for the late '90s, when all trees grew
to the sky, than the challenging times we are facing.
The best executives understand well the wisdom of both cutting and
investing in a downturn. But they also understand you raise prices in
the midst of a recession at your peril. The same could be said for
raising taxes.
The Eagle-Tribune
Sunday, January 13, 2008
An Eagle-Tribune editorial
Andover school budget needs analysis, not drama
Christmas has come and gone. The new year is here. So it's time again
for that annual bit of municipal performance art in which doe-eyed
children are brought before the public and threatened with gibbeting if
stingy taxpayers refuse to pony up more cash.
The drama has had an early debut in Andover this year, where the town
faces a projected $3 million deficit for fiscal year 2009. Town leaders,
as a planning exercise, have asked all departments to come up with
budget cuts totaling that amount, the better to make the case for a
Proposition 2˝ override to taxpayers. The schools have been asked how
they would cut their share - some $1.9 million.
The School Committee has resisted the exercise from the outset, arguing
instead that the focus should not be on producing lists of programs and
people to cut but on getting voters to pass an override - something the
town has never done to fund its schools' and general government's
operations.
"I think this is a process that is doomed," School Committee member
Debra Silberstein said at a meeting in December. "I voted against it.
... Why not talk about (an override) sooner than later. Why wait until
the last minute?"
Andover's school budget for the current year is $57.2 million.
Superintendent Claudia Bach says the schools need $61 million to operate
next year, a $3.8 million (6.6 percent) increase. That's for a
level-funded budget with just $506,400 for nine new teachers and
assistants she says the schools have needed for years.
If the schools lose the $1.9 million plus the $506,400, Bach will face a
deficit of $2.4 million. That is, they'll only have $58.6 million to
spend, or 2.4 percent more than they had for this year.
Note that in budget-speak, level-funding means getting 6.6 percent more
money than you did the previous year and getting 2.4 percent more is a
drastic cut. How so? Because it isn't as much more as you wanted.
Many taxpayers wish their paychecks had received such a "drastic cut."
Bach told town leaders that, if the schools can't make up that $2.4
million, the following cuts might happen: the elimination of the entire
athletic program; an increase in class sizes to 30 students; and the
elimination of all teachers aides or 44 teaching positions.
"This is Draconian and nasty," Bach said Thursday night. "The School
Department will be decimated. Now is that a reasonable exercise? You owe
the kids more than that."
Meanwhile, in a sideshow to the main drama, members of Andover's
teachers union marched in the street Thursday, demanding a new contract
that, in the words of one teacher, will "pay us what you think we're
worth." According to the state Department of Education, the average
Andover teacher earns $60,968, well above the state average of $56,369.
The teachers are demanding more money. The superintendent is demanding
more money. But the town doesn't have any more money.
Bach wants to move directly to talking about an override to fund
operations. But Andover voters have twice rejected such proposals.
The way to get voters to consider an override is for town leaders to
demonstrate they are serious about controlling spending. That's what the
budget-cutting exercise is about. If Andover's school leaders want their
override, they need to prove to all taxpayers, not just the ones who
already support them, that they're serious about controlling the pace of
budget growth.
Drama plays well in the school theater. But selling an override to a
skeptical public takes hard-edged financial analysis.
The Andover Townsman
Thursday, January 17, 2008
Override, contract talks frame budget debates
By Brian Messenger
As Andover teachers turn up the public pressure for a new contract, a
group of residents is proposing a $5 million property-tax override to
solve Andover's operating budget woes.
Town Meeting will have the chance in April to vote on three warrant
articles submitted by the group, according to member Bill Pennington, a
budget liaison with the Townwide PTO. The other two involve allocating
money from the town's reserves to maintain services. The deadline for
residents to submit warrant articles to the town clerk's office is
Friday, Jan. 18.
The group, which consists of roughly a dozen Andover residents - the
majority of whom are involved in town parent-teacher organizations,
according to Pennington - submitted the articles in hopes of closing an
operating deficit currently projected between $2.6 million and $3.5
million for fiscal year 2009, which begins July 1.
"This is a townwide problem. We're looking for the citizens to evaluate
where their priorities are," said Pennington. "It's just disappointing
that here we are going into February and the citizens of the town have
no idea of the options. That's why we took it upon ourselves."
Selectmen Chairman Brian Major said a $5 million override would cost the
average homeowner in Andover $350 more on his annual property tax bill.
The $5 million figure was selected by the group because dollar figures
proposed for the warrant can only be decreased once the warrant closes,
Pennington said.
Another reason for the $5 million number, according to Pennington, is
the group's concern about how town employee salary increases in future
contract settlements will affect operating expenses. All town and school
department contracts with employee unions expired on July 1, 2007.
On Jan. 10, several hundred Andover teachers took to the streets of
downtown to rally for a contract settlement, stopping traffic along
their way from Old Town Hall to the School Administration Building on
Whittier Court next to the Park. They protested outside the school
building for about 20 minutes.
But Major has proposed waiting until after Town Meeting to settle
employee-salary packages, because the town's future fiscal picture will
be more clear after an override vote is made.
"It doesn't mean you should stop the negotiations," said Major. "There's
a lot of things we can work on. If you can come to an agreement on those
other things, then you look at (salaries) as the final piece of the
puzzle."
"Absolutely not," said School Committee member Deb Silberstein of
Major's proposal. "It would be in the best interest of the community to
have the contracts in advance of Town Meeting. To provide full
information; I believe it is our responsibility to do that."
Because about 80 percent of the school department's annual budget is
salary-driven, Pennington said delaying the finalization of contracts
would only add to the uncertainty of the town's fiscal future.
"That's a major concern," said Pennington. "If you don't have anything
in there for a contract, then if you sign the contract, what are you
going to do if there's no room (in the operating budget)?"
To pass a Proposition 2˝ override, two-thirds of Town Meeting voters
must approve the measure and it must also be approved at the ballot box
during a special election. Without a successful override, town officials
expect to make significant service or staff cuts.
"It will be devastating," said School Committee member Tony James.
"Consequently, I applaud the interest by Bill Pennington and his
colleagues, starting to organize an override campaign."
"I give them a lot of credit for being involved," said School Committee
Chairman Art Barber, also a member of the committee's long-term budget
and finance subcommittee. "We've known there was going to be a challenge
with the budget since last Town Meeting. That's why we've being
aggressively pursuing this."
Budget planning subcommittees from the School Committee, selectmen and
Finance Committee met throughout the summer and fall of 2007 to begin
focusing on town revenues, expenses and the fiscal 2009 operating
deficit.
Leaders' meetings 'disappointing'
However, Pennington said officials haven't done enough.
He cited an April 12, 2007, tri-board meeting where Finance Committee
Chairwoman Joanne Marden said the town must avoid waiting to make major
budgetary decisions at the last minute as they did for fiscal year 2008.
"I think the intention was to do that," said Pennington. "The bottom
line is, despite all their hard work and effort, we're no further along
this year than we were last year. It's disappointing."
Pennington said his group met earlier this week to plan a communication
strategy with other town residents. An e-mail list with 8,000 addresses
of PTO members and private residents will be a tool to spread
information about the budget, he said.
"We can reach a lot of people," said Pennington. "We can launch a
campaign fairly quickly and effectively and cost-effectively. It puts us
in good shape to provide information."
Along with PTO members, Pennington said the group proposing the warrant
articles includes other well-known town residents who don't have
children in the public schools.
"We want the people who will lead," said Pennington. "We've got a
diverse group. You don't want to just limit it to parents. Different
groups of people are helpful. We need big-picture people."
The other two of the group's proposals scheduled to be on the warrant
include exploring options that would call for transferring reserves to
cover operating expenses, a move Major called "very dangerous."
"They're looking to take one-time savings accounts and spending them on
operating costs," said Major. "All of a sudden you're growing the
problem. You're putting it off by one year. That's a dangerous,
dangerous precedent. People should be up in arms."
The Milford Daily News
Sunday, January 20, 2008
Signs of a tax revolt?
By Jeff Adair, Daily News columnist
Everybody's talking about recession. Is it coming? Can the government do
anything to stop it? Which party has the best plan to boost the economy?
Gas prices are sky high. Stock prices are dropping like flies. Oil costs
are going through the roof. Every day, the media seem to run a new story
about the - mostly self-inflicted - mortgage crisis.
Are we in a recession right now? Who knows? I'm no economist. One thing
I do know though, as an experienced observer, is that many people are at
their wit's end.
They're voicing their anger, not at the irresponsibility in the private
sector, but at the government for spending, to use a final cliche, like
a drunken sailor.
As a case in point, take the town of Sudbury, home of the historic
Wayside Inn and Martha Mary Chapel, the place where baseball great Babe
Ruth used to rest his head, an attractive community with lots of open
space and high-achieving schools.
Comparatively speaking, Sudbury, with a median household income of
$149,999 in 2006 - more than twice the state average - is a place of
wealth. Take a ride to the town and you'll see plenty of five-bedroom
stately homes on several acres, in the $750,000 to $1 million price
range.
In good times, few complained about teacher salaries or generous
benefits, like the opportunity to take a year-long sabbatical at half
pay.
In the good times, the town constructed a new fire station and regional
high school. Back then, a recent proposal rejected by voters to
construct a new police station would have been approved with few
questions.
Then the economy soured. Some people lost their jobs. Some saw their
companies requiring employees to pay more for health benefits. Some went
through yet another year with a meager 2-percent raise.
Suddenly that $9,751 annual property tax bill, almost $200 a week,
became unbearable.
Those who are truly wealthy remain silent but many others, who live in
such towns only until their kids graduate high school, are hurting
badly.
Over the past couple weeks, demonstrations of a revolt has showed itself
on the Sudbury Town Crier Web site (www.wickedlocal.com/sudbury), which
has been swamped with comments from angry citizens, upset with local
spending.
One day after a story was posted Tuesday about the Lincoln-Sudbury
Regional High School budget, there were more than 100 postings in the
comment section. A week after an earlier story "L-S officials defend
budget" was posted, more than 200 comments were made.
True, some of the "anonymous vitriol" as L-S Superintendent/Principal
John Ritchie describes it, is way overboard. It's, my words here:
ranting, flip and mean, the kind of insults one hears from kids on the
playground. However, some of it is legitimate, and eye-opening.
The complainers aren't just the loudmouth, grandstanding talk radio show
types. It's not just uncaring, tight-fisted, so-called conservatives.
Regular folks are speaking up and it's not just happening in Sudbury.
Questions are being asked that deserve answers. If officials were
unaware before, they have to know now that the public has had enough,
and many aren't going to take it anymore.
"I have a warm feeling in my heart for Sudbury taxpayers who are going
through what we are all going through," Barbara Anderson,
director of Citizens for Limited Taxation, recently told our
Sudbury reporter. "We all have to pay more for fuel, transportation and
other inflation items. But the cities and towns keep wanting us to come
up with more money - in excess of Prop 2˝. The educational
establishments have to face reality. Most of the problems seem to come
from the education budget."
Like it or not officials, those are the realities of 2008.
The Eagle-Tribune
Tuesday, January 28, 2008
An Eagle-Tribune editorial
Higher taxes are not an option
The Massachusetts Taxpayers Foundation is out with its 37th annual
"Municipal Financial Data" booklet. No need to read between the lines; a
glance at the densely packed rows of figures reveals the truth of what
most mayors and selectmen are telling us - cities and towns are up
against it financially.
And in a release announcing publication of its latest summary of tax
rates, spending patterns and revenue trends for all 351 of the
commonwealth's municipalities, MTF notes, "A variety of factors is
placing ever greater pressure on the finances of most cities and towns
with little relief in sight."
Among the report's findings:
l "There is growing
evidence that the Lottery (the principal source of noneducation aid for
cities and towns) has matured to the point that it can no longer provide
dependable increases in state aid."
l "A weak economy ... is
producing only small increases in new growth."
l Voters are displaying an
increasing reluctance to approve Proposition 2˝ overrides. While more
than half the override attempts made in fiscal year 2006 won voter
approval, for fiscal year 2007 the approval rate was down to 34.9
percent.
l City and town budgets are
coming under increasing pressure due to "escalating health care and
other difficult-to-control costs."
"Without a more dependable revenue stream and decisive action to address
health care costs, there will be acceleration of the cuts in programs
and services that have already impacted a large number of communities,"
the MTF report concludes.
Voters want such action, as Gov. Deval Patrick noted in his State of the
State speech last week, but not if that action is going to result in an
increase in their taxes or cost them their jobs. The action they seek,
but which the governor and legislative leaders have failed to deliver
thus far, is an end to public-sector practices such as those that allow
employees accused of even the most heinous crimes to spend months, even
years, on paid leave; that allow too many to retire too early on bloated
pensions; and that reward employees for not cheating on their sick
leave.
Increased taxes won't fly so long as taxpayers feel ripped off by the
system. Legislators know this, which is why you won't see any serious
effort to increase broad-based taxes or modify Proposition 2˝ to make it
easier for cities and towns to increase their property tax rates. But
those same lawmakers have to date been extremely reluctant to take on
the public employee unions, but rather continue to pass all manner of
special-interest bills that only make it more difficult for municipal
officials to keep their budgets in balance.
The last thing Patrick and legislative leaders want is for voters to
force reform of some of these wasteful practices via the ballot box. But
without meaningful action - an easy one would be removing the provision
giving union and retirees veto power over a community's ability to buy
lower-cost health insurance through the state - some sort of taxpayer
revolt is inevitable.
The Salem News
Wednesday, February 6, 2008
The case for raising taxes:
More revenue needed to keep government functioning
By Brian T. Watson
Gov. Deval Patrick, whom I like and voted for in 2006, last month
presented to the Legislature his proposed state budget for 2008.
In order to balance revenues and expenses, his budget counts on the
projected revenue that could be gained from the licensing of three new
resort casinos in Massachusetts. But since the casino proposal is
unlikely to be enacted in fiscal 2008 — and in fact may
never be accepted — and because, if approved, the revenue it
would generate would cover the shortfalls the state faces over the long
term, it is evident that more extensive measures are required both to
control rising costs and increase revenue.
Let's start with the easy reforms.
Almost every fair-minded observer agrees that municipalities could save
money — and thus stretch state dollars — by
joining the Group Insurance Commission (GIC), the state agency that
administers health insurance for state employees. Now open to municipal
workers, the commission is able to procure insurance at lower rates than
those negotiated separately by communities.
Anybody seeking to understand where our rising property tax dollars go
must recognize the incredible increase in health care costs, which in
many municipalities are substantial enough to single-handedly consume
whatever revenue growth those cities experience.
In 2001, for example, health care costs consumed about 7.4 percent of a
typical city or town's budget. By 2005, that share had risen to almost
11 percent.
In some communities — like my own Swampscott —
where municipal employees have not yet approved entry into the GIC, it
is imperative that their unions formulate new negotiating positions that
are consistent with the principle of doing the most good for the most
people.
Similarly, without hurting workers, we can reasonably and wisely reduce
employee costs at the MBTA by reforming the health and retirement
benefits programs there.
We need to control costs where we can, because the rest of the budget
balancing — for this year and the years ahead —
requires asking the public for more money.
As Michael Widmer, president of the nonpartisan Massachusetts Taxpayers
Foundation, told me during a long conversation last week, "Without
additional funds, we simply won't have sufficient revenue over the long
term — with or without casino money — to
maintain even the current level of services."
There are a number of tax increases that I think we ought to consider.
If implemented together, and coupled with the various money-saving
reforms that are possible, they form a politically fair package that
asks something of everybody, but asks more of those better able to
contribute.
* Raising the state gasoline tax by 11 cents, as recommended by the
Transportation Finance Commission, would generate about $400 million per
year. The cost to the average driver would be a relatively modest $65
annually.
* Adding a penny to the 5-cent sales tax would raise $800 million per
year. Although this is somewhat regressive in that it affects the poor
disproportionately, we could balance what we ask of all income groups by
increasing to 8 percent the sales tax on all autos and SUVs costing more
than $30,000, and to 10 percent on all such vehicles over $40,000.
Furthermore, by dedicating some portion of the new revenues to the
maintenance and expansion of the MBTA, we could institute a permanent
freeze on counterproductive fare hikes.
* Lastly, we need to craft a clear plan to introduce two, upper-income
brackets to the state income tax code.
Presently everyone is taxed at 5.3 percent, regardless of income. If we
set a goal of raising, say, $300 million or $400 million annually, we
could tax incomes above $150,000 and $200,000 commensurately.
Previous attempts to institute a graduated income tax have failed.
Distrust of the Legislature, insufficiently defined proposals, simple
misunderstanding of the impact, and anger at and alienation from
government have doomed those earlier efforts.
That last item especially — anger at government —
has translated increasingly in the last decade into a generalized
hostility to the whole idea of paying taxes. Perhaps focused too heavily
on the foibles of government, many citizens have become derisive of the
entire public sector.
But that posture threatens our willingness and ability to support the
state and its municipalities. While government indeed has inefficiencies
that we should strive to eliminate, unlike private enterprise it is not
supposed to be a money-making venture. And it is simply unrealistic to
expect that any large, consensus-run bureaucracy — a
democracy no less — is going to operate without problems.
We've got to start talking and acting like a commonwealth. Sure, it's
your money the government spends, but it's also your neighbor without a
job, health insurance or a manageable mortgage that the government
helps.
As we examine the state budget, debate the costs and benefits of the
programs and initiatives it contains, and weigh the proposals to
increase revenues, we would do well to consider the nature and value of
the services provided by state and local government, and the fairness of
the taxes asked of each of us.
Brian T. Watson is a regular Viewpoint columnist.
State House News Service
Tuesday, February 5, 2008
State Capitol Briefs
Proposition 2˝ leader blasts tax bill due before House
With the House poised to vote Tuesday on a key exemption to Proposition
2˝, one of the property tax law’s principal architects is warning that
loosening the rules could undermine the purpose of the 26-year old
process.
Barbara Anderson, president of Citizens for Limited Taxation, blasted a
proposal (H 2480) that would enable municipalities to exempt certain
elderly voters from the tax increases that result from override vote,
calling it a less-than-subtle effort to keep seniors away from the
polls.
“We’re very concerned about this bill,” she said Monday. “Especially in
a year when property taxes are high enough and we’re all waiting for our
property tax relief.”
Anderson challenged Gov. Deval Patrick to veto the bill, should it reach
his desk, saying anything less would be “a further violation of his
promise” to lower property tax burdens.
A spokesperson for the governor was not immediately available. Anderson
said she would be sending a memo to legislative leaders detailing her
opposition to the bill.
Sponsored by Rep. Ruth Balser (D-Newton) and House Majority Leader John
Rogers (D-Norwood), supporters argue that it will protect seniors with
limited incomes and soaring property values from financially crippling
tax hikes. Balser told the News Service on Friday that her proposal
passed the Legislature during the tenure of Acting Gov. Jane Swift but
died after she vetoed it.
“In an era of state deficits, where our hands are tied to a certain
extent, we can give municipalities certain options that give them
certain flexibility over how they raise revenue,” Balser said.
Under the bill, individuals would be eligible for the exemption if they
are 65 or older, occupy their home as their principal residence, if
their property tax payments exceeds 10 percent of total income, and if
their income, with their spouse, is less than $60,000 per year.
Boston Magazine
December 2007
Fate of the Unions
By Joe Keohane
With a string of recent organized-labor outrages, what was once a
fairy-tale notion in Massachusetts — hard-core union-busting — may
become a reality in today’s dire fiscal times. All we need is the right
demagogue.
Governor Patrick’s compulsive hope-mongering has always struck me as a
bunch of sweet-smelling nonsense, but earlier this year, I had a glimmer
of what he was getting at. It happened during the debate over whether to
allow municipal workers in Massachusetts cities and towns to join the
state’s Group Insurance Commission, or GIC. According to an independent
analysis, bringing these workers into the state pool — which offers more
flexibility and lower premiums and administrative costs — would save
cash-strapped cities and towns an estimated $100 million in healthcare
costs in 2009, and $2.5 billion annually by 2018. But there was a
potential roadblock: The municipal unions weren’t into it, because every
aspect of the plan wouldn’t be subject to collective bargaining. That
the unions were blockading some critical cost-cutting was unsurprising —
in Massachusetts, that’s what unions are for — but what was different
this time was that it looked as if, for once, they might not get their
way. At least that’s how it seemed when House Speaker Sal DiMasi
suggested we might leave it to the towns, and not labor leaders, to
decide.
The audacity of hope! Together we can! And so forth! In the end, of
course, lawmakers gave away the store to the unions, telling towns they
could join the GIC only if 70 percent of their union members voted for
it. Though DiMasi warned if the unions didn’t cooperate, he’d “take them
out of the equation,” it sounded a shade too blustery to be true.
Naturally, the response has been whopping: Five of the state’s 351
communities signed up by the November 5 deadline.
Still, just entertaining the idea that anyone would do anything in this
state without first kissing the hems of the unions’ garments had me
walking on air. I felt like a moonbat. Not the Deval-worshipping species
of moonbat, but a kind of genetic mutant that only modern-day
Massachusetts could produce: one that dreams of a day when the populace
will finally rise up and overthrow the tyranny of…organized labor.
(Hardly the sort of thing you think of when you hear the phrase
“movement of the people.”) A string of recent villainies perpetrated by
unions, along with Deval Patrick’s tentative sorta-suggestion that he
may “look at” ending police details (greeted by gales of laughter), has
only intensified the feeling.
Certainly, something must be done here. Formed to prevent the powerful
from preying upon the powerless, our public employee unions have
themselves become the powerful — their incessant wails for “fairness”
are minor masterpieces of Orwellian doublespeak — and it’s the rest of
us who are powerless against the flabbergastingly senseless status quo
they spend their days defending. With municipalities more reliant on
rising property taxes than they’ve been in 25 years, and unions
squashing anything that would help cut costs or increase efficiency, I
started to wonder whether we’re approaching a time when voter anger will
outweigh union clout, and politicians will be able to take a stand
without being carted off in pails afterward.
So I called Sam Tyler, the Boston Municipal Research Bureau’s president,
to run it past him. “You think that day has come?” Tyler said. And then
he laughed. And it wasn’t a sarcastic laugh, or a laugh for effect. He
was actually laughing. And while he kept laughing, I began to feel like
a college freshman who’s asked a hard-bitten soldier how many drum
circles he thinks it would take to stop all wars.
Yet mocking laughter, however rooted in reason, truth, and history, only
serves to strengthen the moonbat’s resolve. As municipalities resort to
a steady parade of Proposition 2˝ overrides just to keep the lights on,
and the state performs its grotesque courtship dance for casino
developers, the situation looks more and more like a tipping point or,
better yet, a tinderbox. It’s a juncture ripe for revolution. All that’s
needed now is a few real revolutionaries.
The phrase “union abuses” can conjure a sordid array of images, but for
many, police details are first on the list. As a 2004 Beacon Hill
Institute study pointed out, Massachusetts is the only state in the
country that requires trained law-enforcement officers to sleep or read
the Herald near construction sites in exchange for mammoth amounts of
money — money that is later factored into their pensions. (The unions
have always justified the practice on the grounds of public safety,
which might wash if, as noted by the same study, our state didn’t still
have some of the worst car accident rates in the nation.) In the past
months, we’ve seen a few classics of the form, such as the Gloucester
cop who was hired to work eight hours at a private construction site,
showed up late, worked two hours, left to work another detail, and then
double-billed for the first.
But the police have by no means cornered the outrageous-abuses market.
What about the schoolteachers in Quincy who went on strike because the
mayor asked them to contribute 20 percent to their healthcare premiums
(a not-unreasonable request, given that many private-sector employees
pay around 25 percent)? Or the firefighters in Newton attacking the
mayor at every turn because he wants them to prove they’re actually sick
when they take their 24-hour sick days (often in August), racking up
hundreds of thousands of dollars in overtime? Or the firefighters in
Boston who adamantly opposed random drug testing and annual physicals,
only to have that blow up in their faces when it was reported that one
of the jakes killed battling the West Roxbury restaurant fire was drunk
at the time and the other had cocaine in his system? Or the T, which
keeps jacking up fares merely to maintain the current levels of poor
service, while offering its employees retirement with full health
benefits after 23 years, regardless of age — a deal the state’s
Transportation Finance Commission called “among the most generous in the
country”?
“They are just greedy beyond comprehension,” says David Tuerck, Suffolk
University economist and head of the Beacon Hill Institute. “And I don’t
think it can be explained anymore by political [power]. It’s just a
failure on the part of politicians to think through their own
self-interest.”
Which is to say, there may now be more political hay to be made by
solving the state’s financial ills than by blowing kisses to the unions.
But our pols have long feared making that stand, even if doing so
properly could result in lower taxes and better services for their
constituents. It’s not enough to blame them for their cravenness; you
also have to look to an electorate so bewitched by unions’ sentimental
appeal that it has never provided a bludgeon for the right politician to
take some swings. There’s no question voters should be more than fed up
with this state of affairs, paying ever higher property taxes to fund
the kind of lavish benefits they’re not getting anymore in the private
sector. In Boston, for instance, it takes five average taxpayers to
cover the city’s 90 (!) percent share of one employee’s family health
plan — the cost of which has nearly doubled since 2001. Statewide,
property taxes have gone up 32 percent since 2001, even as social
service programs have been cut, meaning that taxpayers are shelling out
more to pay for benefits they’re not getting, in exchange for fewer
services. There’s “fairness” for you.
“There is a collision course,” says Michael Widmer, head of the
Massachusetts Taxpayers Foundation, “between the long-standing power of
the public employee unions on one hand, and the inability of state and
local governments to continue to support the benefit structures, the
health and pension plans, on the other. That reality is, I think,
forcing this issue to the surface.”
Right now, though, the urgency is surfacing only in the overzealous
pursuit of new revenue sources, like local option taxes (which were
torpedoed by DiMasi) and casinos. The governor is estimating that his
proposed gambling palaces will result in an annual $400 million
windfall, $200 million of which would go to tax credits. That figure has
been widely debunked by skeptics, but let’s give our governor the
benefit of the doubt. Here’s the thing, though: According to one study,
we’re squandering $100 million a year on police details alone. If
Patrick had the guts to go after that perk, and unions were also
compelled to join the GIC — saving another $100 million out of the gate
— we would have as much money for municipalities as we would under the
absolute best possible scenario with casinos, only without that dull
shine of whorishness, the appalling regressiveness, and the outright
shame of following Connecticut’s lead in anything. Win-win-win.
What would it take to bring our politicians around? I asked one local
political consultant (who asked to remain anonymous — he wants to keep
working), and he tentatively pointed to the firefighter tragedy/scandal
as an example of how public outrage against unions could be sustained.
“It takes something horrible — one guy with coke and one guy with booze
— and it’s finally something the public can get their heads around,” he
said. “But in the end, eight months down the road, will the public still
remember, or care? Will the politicians still have the courage to come
forward?”
A fair point. Politicians will only come forward if the public outrage
is sustained, and the public will only shed their union-outrage fatigue
if they can be reasonably confident that this time their ire will yield
results. Even though the unions have been their own worst enemy
recently, with the cluster of exquisite chicaneries aforementioned, that
alone won’t do the job. What’s needed is careful deployment of the tool
they have been using so deftly against us for years: old-fashioned
demagoguery.
One need look no further than the unions themselves, those masters of
the dark art, for tips on how this is done. For years, anytime someone
has ventured any criticism, it’s been met with a furious overreaction
designed to stop the discussion dead. The police unions have always used
the public safety card, and the teachers the “What about the children?!”
card. The Boston school bus drivers once accused the city of being
racist because it wanted to equip their vehicles with GPS systems, buses
being symbols of busing, and by extension, integration. And I’m pretty
sure you’re still not allowed, in this post-9/11 era, to criticize
firefighters for anything.
So whoever is going to take this on should expect immediate,
disproportionate retaliation, and prepare to respond in kind. As in any
political campaign, it would be wise to keep an ad in the drawer, and
when the cops start scare-mongering about how traffic details deter
pederasty, and the teachers start spinning horror scenarios involving
illiterate adult-children washing rats for a living, launch it. I’m just
brainstorming, but here’s one idea: The ad opens with an image of a nice
old couple losing their home because they can’t keep up with their
property taxes. As they’re shuffling away, clutching a blanket and some
photos of the grandkids, T workers wearing top hats and monocles rifle
through their house, chortling at how gauche the wallpaper is. The
couple wander aimlessly before finding themselves in a rough urban
neighborhood, where they’re set upon by teenage hoodlums who aren’t in
school because their teachers are on strike over the city’s refusal to
meet their demands for daily hot stone massages. The hoods take
everything the couple have, and then run off past an enormously fat cop
sleeping on a nest of hundred-dollar bills in a cruiser by a
construction site. The last shot is of the old couple trembling in an
alley somewhere, perhaps with some vicious curs closing in. Onto the
screen flash calculations of what the more egregious recent union abuses
cost taxpayers, and finally the words “UNION SOLIDARITY? WITH WHOM?”
Or some such. The unions, who’ve long nurtured a victim complex to great
political avail, will of course cry foul, howling about how without them
we’d all be working 18 hours a day in some godforsaken cannery. But if
the ad is played right, the sentimental underdog appeal that is a key
part of their power will be eroded, and, with voter backing, real gains
might be made.
Admittedly, it’s a long shot, but I still say there’s hope. To pull one
from Nabokov (who, like union foes, was frequently accused by weasels of
harming children), it may be but a brief crack of light between two
eternities of darkness, but, hell, it’s something. Besides, in times of
crisis, we moonbats must dream.
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