CLT UPDATE
Tuesday, May 5, 2009
Ripping off taxpayers large rolls on
Wary Beacon Hill leaders warned last
week of a worst-case scenario in which state tax revenues for April
might fall as much as $365 million below projections. In hindsight, that
looks more like unbridled optimism.
Revenue officials reported yesterday that tax collections for April
plunged 34.9 percent from the prior year, or $456 million below
expectations, setting off another frantic scramble in the State House to
plug a budget deficit that appears to be expanding by the day.
Almost every tax that the state collects - sales, income, capital gains,
and corporate - fell below projections that were revised downward just
three weeks ago....
Revenues have consistently fallen short all fiscal year, which will put
even greater pressure on Patrick and the Legislature to cut programs or
raise taxes. The discussions will almost certainly ratchet up tensions
in the already tense relationship between Patrick and Democratic
lawmakers, who have been quarreling over which taxes to raise and how
much to raise them....
Meanwhile, a Massachusetts business group launched a statewide campaign
yesterday to oppose a sales tax hike, arguing that a recession is the
worst time to increase the tax burden on businesses. The group has not
opposed the gas tax.
The Boston Globe
Monday, May 5, 2009
Bigger deficit looms for state
April revenue is $456m below expectations
At the start of last week the House voted to take an
additional $900 million a year out of the pockets of state taxpayers by raising
the sales tax 25 percent....
By the end of the week the already gloomy revenue news was getting worse.
Phrases like “free fall” were being used on Beacon Hill. Revenue collections for
the current fiscal year (ending June 30) had fallen by another $300 million....
So how did the House react? Well even as the revenue news grew increasingly
grim, they remained in a budget bubble - working overtime increasing the once
responsible House budget. They continued to vote overwhelmingly on amendment
after amendment to throw money at programs and special interest groups.
By the end of Thursday, more than $530.6 million had already been added back
into the budget. Friday they continued on that path....
Fiscal crisis? What fiscal crisis - as long as the taxpayers can be tapped until
they run dry.
A Boston Herald editorial
Monday, May 4, 2009
Denial on the Hill
Ten former state lawmakers are enjoying early, enhanced
pensions after quitting the Legislature, beneficiaries of a loose, even
questionable, reading of state law that could cost state taxpayers up to $3
million in additional retirement costs, according to a Globe review....
The use of such provisions by the same lawmakers who shape retirement rules
illustrates how deeply pension gamesmanship, as it is viewed by critics, is
embedded in the culture of Beacon Hill. Governor Deval Patrick, a Democrat,
complained last week that his proposals to overhaul pension laws are idling in
the Legislature....
The real value to the retiring lawmakers is not merely that the pensions are
boosted in size, but that the beneficiaries begin collecting them immediately,
with no financial penalty. It has allowed most of these lawmakers to collect
pensions in their 40s that would not otherwise kick in until they were in their
mid-50s....
Francis G. Mara, a Democrat from Brockton who retired in 1996 at age 45, got a
$11,300-a-year increase, worth a total of $395,000 if he lives to 80; and Paul
E. Caron, a Democrat from Springfield who retired in 2003 at age 47, got a
$14,500 annual bump in his pension, worth $480,000 in estimated lifetime
payments.
Mara and Caron are now lobbyists....
The Boston Globe
Sunday, May 3, 2009
Pension boost aids lawmakers
Loophole may cost taxpayers an extra $3m
Governor Deval Patrick said yesterday that he wants the state
to rescind the special pensions given to 10 former legislators because it
appeared that those pensions were improperly awarded.
Patrick said the 10 pensions, which were the subject of a page one story
yesterday in the Boston Sunday Globe, were the latest evidence of a broken
system that rewarded former lawmakers and other politically connected
individuals with extra benefits not available to regular government employees
and costs taxpayers thousands of dollars a year in each case....
One of the chief perks of the special pension is that beneficiaries can collect
them immediately after leaving state service. For the 10 former lawmakers, the
average age when they began collecting was 48.
The Boston Globe
Monday, May 4, 2009
Governor wants state to rescind pension perk
Questions benefits given to 10 lawmakers
The absurd state law that allows legislators turned out of
their jobs by the voters to collect enhanced pensions is bad enough. Now Globe
reporter Sean Murphy has found that 10 former state lawmakers were able to snare
early pensions without having lost election, thanks to favorable arrangements
with the state Retirement Board....
The law may be fuzzy, but one thing is crystal clear. This looks like 10 more
cases of Beacon Hill taking care of Beacon Hill. Day by day, abuse by abuse, it
adds up.
A Boston Globe editorial
Monday, May 5, 2009
New day, new pension scandal
The latest chapter in outrage from the state’s festering
public-pension scandal is a Boston Sunday Globe report detailing how 14 former
state legislators are enjoying enhanced pensions under a 1950 law amendment that
extends to lawmakers a protection originally designed for state workers. The
report notes that 10 of those individuals may not even qualify for early
pensions under the law....
The Legislature is finally taking aim at the “one day, one year” rule, but we
have to wonder how many other arcane provisions lie buried in the thicket of
some 500 pages of rules and amendments that constitute Chapter 32 of our state
laws, governing pensions.
The Legislature that created and profits by such abuses cannot be counted upon
to remedy them.
A Telegram & Gazette editorial
Tuesday, May 5, 2009
Puffy pensions
Lawmakers abusing 1950 rule
One day. That’s all it took.
We wait years for pension reform. Years for the state to reform health care
purchasing. Decades for elected officials to shrug off the embrace of public
employee unions. And still none of it is done.
But increase the sales tax? All it takes is a day....
Reforms take decades - if they ever happen. A $1 billion tax increase takes a
day....
The curtain has come down on the House’s first act of disrespect to the voters.
We await the Senate’s second act, but without much hope. The final act may lie
with the governor....
The question for us is whether he and legislators should be re-elected.
The Boston Herald
Friday, May 1, 2009
Gov’s anti-tax stance mustn’t be just an act
By Jim Stergios
Our lawmakers have simply not done the hard work of reform,
while spending too much of our treasure on positions and perks that should not
exist. They seem to be betting voters will eventually accept new taxes and fees
as the price that must be paid for the government they evidently relish.
That bet may be correct, but no tax increase can offset the poison of
deep-seated government waste. Household and statewide economies can only take so
much. By failing to enact reforms, our leaders are breaking faith with the broad
spirit of the social contract. And, harsh as it sounds, voters who fail to hold
them accountable are complicit.
A Telegram & Gazette editorial
Sunday, May 3, 2009
A fraying contract
Of reforms, the ballot box and decline
A sales tax battle between a tire company and the state
Department of Revenue is headed to the highest court in Massachusetts.
At issue is a claim that Town Fair Tire Centers sold tires in New Hampshire to
customers who appeared to be from Massachusetts, but did not collect the 5
percent sales tax that would have been levied if the tires were sold in Town
Fair’s Massachusetts stores....
The Supreme Judicial Court is scheduled to hear arguments Thursday.
Associated Press
Sunday, May 3, 2009
Mass. court to hear controversial
N.H. tire sales tax case
Chip Ford's CLT
Commentary
Goodness gracious, the
state's in another "fiscal crisis" -- what to do?
The House has a plan.
Tax and spend more, of
course.
What happened to "reform
before revenue"? Apparently Transportation Secretary James Aloisi
was correct, it's been and is nothing but a “meaningless
slogan.” And to think how 'outraged' the posturing Bacon Hill
pols were when he dared utter that inconvenient truth.
How could we possibly find
ourselves in yet another "fiscal crisis." After all, we're
still paying for the one back in 1989, when the Bacon Hill pols hiked
our income tax "temporarily," and the one after that in 2002, when they
imposed what the Boston Globe called "the
largest tax increase in state history," right? Surely we
learned something from experience, no?
No. The House is
doing it to us again -- in the midst of the economic meltdown.
Spend, spend, spend -- then hike taxes and spend even more. Can we
expect anything better from the Senate?
Revenues are down
dramatically. "How can this be," they ponder in amazement -- as
they tax more and leave less for us to spend which in turn would
stimulate the economy, provide for jobs, and increase revenue from the
usual sources. Washington cuts taxes, gives us back a rebate, so
we'll spend it to stimulate the economy. On Bacon Hill all federal
stimulation means is that we have a little more they can take from us.
What do they care -- its
your money and mine that their spending and taking. There's little risk
of not being re-elected and, even if the unthinkable happens all the
better. They'll just bail out of the Legislature with a golden
parachute pension and benefits, courtesy of us taxpayers.
We recently learned that
they collect their comfortable pension and an additional
"enhanced"
bonus if they retire for health reasons; the voters got sick of them.
Now we find out they can collect that "enhanced" pension even if they get sick
of us voters and leave on their own, upright and still warm -- a
very rare occurrence in the People's Republic of Taxachusetts.
What now puzzles me most
is, why are so many of the entrenched so obsessed with hanging onto
their jobs?
I think any of us private
sector serfs would "retire" young in a heartbeat, especially if at 40 or
50 we were provided an even more lucrative pension for life paid
for by someone else! Of course, that'll never happen out here in
the real world where we don't make the rules.
 |
|
Chip Ford |
|
The Boston Globe
Monday, May 5, 2009
Bigger deficit looms for state
April revenue is $456m below expectations
By Matt Viser
Wary Beacon Hill leaders warned last week of a worst-case scenario in
which state tax revenues for April might fall as much as $365 million
below projections. In hindsight, that looks more like unbridled
optimism.
Revenue officials reported yesterday that tax collections for April
plunged 34.9 percent from the prior year, or $456 million below
expectations, setting off another frantic scramble in the State House to
plug a budget deficit that appears to be expanding by the day.
Almost every tax that the state collects - sales, income, capital gains,
and corporate - fell below projections that were revised downward just
three weeks ago.
The only tax that did not fall dramatically was meals taxes. Income tax
collections in April were down $905 million over what was collected last
year.
"Very somber" was how Senate President Therese Murray described an
afternoon meeting with Governor Deval Patrick and House Speaker Robert
A. DeLeo.
The result, officials now estimate, is an additional $1 billion
shortfall over the final three months of the fiscal year, in addition to
the $3 billion deficit that has already been closed by a combination of
cuts and spending from the so-called rainy day fund.
But with only eight weeks left in the fiscal year, the state's options
are limited. The state has only about $1.3 billion remaining in its
reserve account, which means that further cuts are almost certain,
possibly to a local aid payment scheduled to go out June 30.
The shortfall for the remainder of this year is growing even as State
House officials are trying to stitch together a budget for next year
that has revenue projections that continue to fall. The revenues that
House lawmakers and the governor built their budgets on, an estimated
$19.5 billion, is now expected to fall by at least $1 billion, and
Patrick is planning to submit a revised budget based on the new figures.
Patrick said he is planning to announce solutions to the current year's
shortfall later this week. While he said he would try to avoid cutting
local aid, he would not definitively rule it out.
"You know how I feel about local aid, the same way I feel about
education," Patrick said following a press conference late yesterday.
"What we have to solve for so late in the fiscal year means you can't
really get there through cuts. You have to find other ways."
Revenues have consistently fallen short all fiscal year, which will put
even greater pressure on Patrick and the Legislature to cut programs or
raise taxes. The discussions will almost certainly ratchet up tensions
in the already tense relationship between Patrick and Democratic
lawmakers, who have been quarreling over which taxes to raise and how
much to raise them.
Last week the House approved an increase in the state sales tax from 5
percent to 6.25 percent, but Patrick has threatened to veto it unless
lawmakers approve a series of ethics, pension, and transportation
overhauls. There were heavy tensions between Patrick and the Legislature
all last week, with many Democratic lawmakers accusing Patrick of
launching his reelection campaign by using the Legislature as a punching
bag.
Murray said the topic of last week's tensions did not come up during the
meeting today, part of their series of regular Monday gatherings and the
first time the three leaders met face to face since the tax vote.
"I'm not going to respond to any of that," Murray said. "We have such a
fiscal crisis in front of us that it's imperative that we all work
together to resolve this."
Meanwhile, a Massachusetts business group launched a statewide campaign
yesterday to oppose a sales tax hike, arguing that a recession is the
worst time to increase the tax burden on businesses. The group has not
opposed the gas tax.
The campaign released two radio spots, titled "Tough Times" and "Main
Street," that urge residents to call the governor and state lawmakers to
oppose the proposed sales tax hike.
"An increase in the sales tax at this time will have a devastating
impact on the small retailers that populate the storefronts of our 351
Main Streets across Massachusetts," said Jon Hurst, president of the
Retailers Association of Massachusetts, which has 3,000 members across
the state. "Many of these small businesses are barely surviving because
of the economic downturn. An increase in the sales tax is going to send
even more of their customers to tax-free New Hampshire and the
Internet."
The radio campaign is schedule to run for the next two weeks on stations
across Massachusetts. The business group is also planning further
actions that could include radio, print, and direct mail campaigns.
The House plan, approved by a veto-proof margin of 108-51, would raise
an estimated $900 million. The representatives voted to dedicate about
$275 million of new revenue to transportation, instead of seeking a gas
tax increase as proposed by Patrick.
Senate lawmakers are preparing their budget proposal for next fiscal
year and are planning to lower revenue estimates by at least $1 billion
below the budgets crafted by Patrick and the House.
Senate Ways and Means chairman Steven C. Panagiotakos and other senators
are planning to hold a hearing with economists today to firm up the
revenue estimates before the budget proposal is released later this
month.
The Boston Herald
Monday, May 4, 2009
A Boston Herald editorial
Denial on the Hill
At the start of last week the House voted to take an additional $900
million a year out of the pockets of state taxpayers by raising the
sales tax 25 percent.
By the end of the week the already gloomy revenue news was getting
worse. Phrases like “free fall” were being used on Beacon Hill. Revenue
collections for the current fiscal year (ending June 30) had fallen by
another $300 million. Last Thursday Senate leaders met and decided that
their budget would have to assume at least $1 billion - possibly as much
as $1.5 billion - less in revenue than both the governor and the House
had originally assumed in their respective budgets ($18.5 billion
instead of $19.5 billion).
So how did the House react? Well even as the revenue news grew
increasingly grim, they remained in a budget bubble - working overtime
increasing the once responsible House budget. They continued to vote
overwhelmingly on amendment after amendment to throw money at programs
and special interest groups.
By the end of Thursday, more than $530.6 million had already been added
back into the budget. Friday they continued on that path.
There were items like $1.7 million for a loan repayment plan for primary
care physicians who agree to work in community health centers for two to
three years. A nice idea? Certainly. But essential to the delivery of
state services? Hardly.
More than $8 million was added for regional transit authorities. And
state employees, who under the original House budget were to pick up 30
percent of their health insurance costs, will be picking up only 20
percent (25 percent for new hires).
As for reform? Well, a move to allow the Registry of Motor Vehicles to
use private vendors, like AAA, to help serve customers - gone! Just
thank Rep. Frank Smizik (D-Brookline). But thank goodness those Asian
longhorn beetles plaguing Worcester will be studied to death.
Fiscal crisis? What fiscal crisis - as long as the taxpayers can be
tapped until they run dry.
The Boston Globe
Sunday, May 3, 2009
Pension boost aids lawmakers
Loophole may cost taxpayers an extra $3m
By Sean P. Murphy
Ten former state lawmakers are enjoying early, enhanced pensions after
quitting the Legislature, beneficiaries of a loose, even questionable,
reading of state law that could cost state taxpayers up to $3 million in
additional retirement costs, according to a Globe review.
The State Retirement Board granted the special benefits under a 1950 law
that says public officials can take immediate pensions if they lose an
election or fail to qualify for the ballot. But of the 14 state
legislators who have received such pensions, only four fit that
definition. The other 10 were not defeated by voters. They departed
office voluntarily.
Treasurer Timothy P. Cahill, whose office oversees the Retirement Board,
suggested such a stretching of the rules is improper.
"The intent of the statute is to provide a benefit to someone who was
involuntarily removed from their position, through no fault of their
own," Cahill said in the e-mailed statement. Cahill, a Democrat,
declined a request for an interview, leaving questions unanswered over
whether he plans to strip any of the benefits awarded to the 10
legislators.
The Globe discovered the pension enhancements during a review of
retirement benefits of former lawmakers, part of an ongoing series by
the newspaper. The review found that many legislators routinely take
advantage of provisions that allow them to boost their retirement pay in
ways that most Massachusetts residents cannot. In the most common
practice, the review found, more than 52 legislators were awarded a full
year of pension credit for as little as one day of work in a calendar
year.
The use of such provisions by the same lawmakers who shape retirement
rules illustrates how deeply pension gamesmanship, as it is viewed by
critics, is embedded in the culture of Beacon Hill. Governor Deval
Patrick, a Democrat, complained last week that his proposals to overhaul
pension laws are idling in the Legislature.
Cahill, in his e-mailed statement, said he was not responsible for
pensions that were approved before he was elected. "I can't speak for
past retirement boards or the actions of retirees but I can say that we
will not shy away from making difficult decisions," the statement said.
After the Globe inquiries, the Retirement Board on Thursday changed
course. For the first time, the board voted to deny such a pension to a
recently retired state representative, Democrat Paul C. Casey of
Winchester. Casey, 48, had sought to boost his pension by $10,000 a
year, or up to $315,000 extra if he lives to 80, a conservative estimate
based on Social Security actuarial tables. Casey did not respond to
requests for comment.
The concept of early, enhanced pensions was approved by lawmakers in
1945 to protect state employees with 20 years or more of tenure in the
event they were fired to make way for patronage appointments during
changeovers in administrations. It gave them one-third of their salary
as a pension, starting as soon as they were dismissed. In 1950, the
Legislature expanded it to include its own members as well as other
elected officials.
The real value to the retiring lawmakers is not merely that the pensions
are boosted in size, but that the beneficiaries begin collecting them
immediately, with no financial penalty. It has allowed most of these
lawmakers to collect pensions in their 40s that would not otherwise kick
in until they were in their mid-50s.
Christopher J. Hodgkins, a Democrat from Lee who stepped down from the
House in 2003 at the age of 45, for example, got a $15,800-a-year boost.
That is worth about $550,000 in total extra benefits if he lives to 80.
Francis G. Mara, a Democrat from Brockton who retired in 1996 at age 45,
got a $11,300-a-year increase, worth a total of $395,000 if he lives to
80; and Paul E. Caron, a Democrat from Springfield who retired in 2003
at age 47, got a $14,500 annual bump in his pension, worth $480,000 in
estimated lifetime payments.
Mara and Caron are now lobbyists.
"I was told there was a provision for this, that it was the law, and I
just put my papers in and that was it," said Mara.
Joseph D. Malone was state treasurer in 1991, when immediate pensions
for voluntarily departing legislators were first approved by the
Retirement Board. Malone in an interview said he could not remember much
discussion or analysis prior to the approvals.
"I can't remember any department head coming to me and asking, 'What
should we do,' and me saying 'Yeah, give it to them,' " said Malone, a
Republican.
"It was a long time ago," he said.
Among the first batch of three state representatives who got the special
pension in 1991 was Alfred E. Saggese Jr. of Winthrop. Saggese said in a
telephone interview that he knew nothing about the distinction between
losing reelection and not seeking reelection.
"You are telling me this for the first time," he said. "I went to the
Retirement Board, filed my papers and answered their questions. My
understanding was that as a legislator you were immediately eligible to
take a pension. I took the pension they gave me."
Saggese retired at age 44, receiving about $11,000 a year in additional
pension payment, almost $400,000 in estimated additional lifetime
pension payments. He has practiced law since then.
The other two representatives departing in 1991 were Vincent J. Piro of
Somerville, and Angelo Marotta of Medford. Piro and Marotta did not
return telephone messages.
J. James Marzilli Jr., the former Democratic state senator from
Arlington, has an application for a termination pension pending at the
Retirement Board. Marzilli announced he would not seek reelection two
days after his arrest in June for allegedly sexually harassing four
women in Lowell. He is awaiting trial.
Even though he did not campaign, Marzilli's name remained on the ballot
in November's election. That may technically allow him to claim he lost
his seat - and double his pension to about $27,000 a year, beginning
when he turns 51. Marzilli's lawyer did not return a telephone message.
Less lucrative for each legislator, but far more prevalent, is the
practice of awarding a full year of credit toward a legislator's pension
for as little as one day in office in a calendar year. The provision
produces a natural departing bonus for lawmakers, because their terms
don't end until their replacements are sworn in in January.
Since 1991, that interpretation - which applies only to elected
officials - has added almost $850,000 to the expected lifetime pension
costs of 52 former legislators, or an average of about $16,350 each.
Almost all former legislators took advantage of the provision, both
Democrat and Republican, but a few declined the extra boost, including
Thomas M. Finneran, the former Democratic House speaker. By doing so,
Finneran left about $31,000 on the table.
The law that opens the door for the so-called one-day pension boost is
ambiguous. It says elected officials "shall be credited with a year of
creditable service for each calendar year during which he served." An
opinion issued by former attorney general Francis X. Bellotti in 1976
said one day of service in a year was sufficient to qualify.
Bellotti, in a telephone interview, last week said his opinion was "a
straight statutory interpretation of what the language meant," without
regard to politics.
"It didn't come out of thin air," he said
Ten former lawmakers received enhanced, early
pensions when they voluntarily stepped down from the Legislature, under
an expansive reading of a law that is supposed to award such pensions to
public officials who are defeated by voters. Shown are the number of
years the lawmakers served in the Legislature and their hometowns at the
time of their service; in most cases they combined additional previous
public service to reach a 20-year minimum pension requirement. Pensions
shown are the amount scheduled to be paid during 2009, with the
exception of that for Susan Schur.
Alfred Saggese
Winthrop
House, 16 years
Age at retirement: 44
Pension: $18,226 |
Susan Schur
Newton
House, 14 years
Age at retirement: 54
Pension: $15,205 (as of 1995) |
Vincent Piro
Somerville
House, 16 years, 8 months
Age at retirement: 49
Pension: $18,871 |
Francis Mara
Brockton
House (or Senate), 14 years
Age at retirement: 45
Pension: $18,921 |
Edward Burke
Framingham
Senate, 22 years
Age at retirement: 49
Pension: $22,041 |
Richard Voke
Chelsea
House, 24 years
Age at retirement: 50
Pension: $28,192 |
Angelo Marotta
Medford
House, 14 years
Age at retirement: 53
Pension: $20,044 |
Christopher Hodgkins
Lee
House, 19 years
Age at retirement: 45
Pension: $22,252 |
Raymond Jordan
Springfield
House, 19 years
Age at retirement: 51
Pension: $20,209 |
Paul Caron
Springfield
House, 20 years
Age at retirement: 47
Pension: $23,154 |
The Boston Globe
Monday, May 4, 2009
Governor wants state to rescind pension perk
Questions benefits given to 10 lawmakers
By Sean P. Murphy
Governor Deval Patrick said yesterday that he wants the state to rescind
the special pensions given to 10 former legislators because it appeared
that those pensions were improperly awarded.
Patrick said the 10 pensions, which were the subject of a page one story
yesterday in the Boston Sunday Globe, were the latest evidence of a
broken system that rewarded former lawmakers and other politically
connected individuals with extra benefits not available to regular
government employees and costs taxpayers thousands of dollars a year in
each case.
"This must end," Patrick said in a telephone interview. "It is exactly
the kind of special favors, gamesmanship, and insider maneuvering that
the public is fed up with."
A law passed in 1950 allowed enhanced, early pensions for legislators if
they lose an election or fail to qualify for the ballot. It was based on
an existing benefit intended to compensate long-term state employees if
they were fired to make way for patronage appointments, and gave them
one-third of their salary, starting as soon as they were dismissed.
But the 10 lawmakers who were granted these special pensions by the
Massachusetts State Board of Retirement were not turned out by voters;
they left office voluntarily.
The Retirement Board is chaired by state Treasurer Timothy P. Cahill and
includes two members elected by the membership, one appointed by Cahill,
and one chosen by the other four board members.
Cahill, who questioned the pensions in a written statement last week,
again declined a request for an interview yesterday.
Patrick said he directed his legal counsel to take steps to get the
pension board to rescind the additional benefits because he believes the
benefits were unwarranted.
The early pensions are worth an average of $300,000 for each legislator
over the lifetime of the benefit, according to a Globe calculation,
based on the retirees living to age 80. According to Social Security
actuarial charts, the estimate is conservative.
Besides undermining public confidence in government, Patrick said the
special pensions are expensive. "It's not just wrong in the abstract,"
he said. "It's also costing us money."
One of the chief perks of the special pension is that beneficiaries can
collect them immediately after leaving state service. For the 10 former
lawmakers, the average age when they began collecting was 48.
For Christopher J. Hodgkins, a Democrat from Lee who stepped down from
the House in 2003 at age 45, the extra benefit was worth $15,800 a year,
or about $550,000 if he lives to 80.
Others who received such boosts are Alfred Saggese of Winthrop; Vincent
Piro, formerly of Somerville; Edward Burke of Framingham; Angelo Marotta,
formerly of Medford; Raymond Jordan of Springfield; Susan Schur of
Newton; Francis Mara of Brockton; Richard Voke of Chelsea; and Paul
Caron of Springfield.
Saggese and Mara, reached last week, said they were unaware of anything
suspect in the their pensions.
"I was told there was a provision for this, that it was the law, and I
just put my papers in," said Mara.
The special pensions were granted either before Cahill became treasurer
and chairman of the Retirement Board, or during his first year in
office. In a written statement last week Cahill said the earlier
allowance for the enhanced pensions was a stretch, but he declined to
say if he would seek to rescind the existing 10 pensions.
The Globe pressed the Retirement Board last week for its basis for such
pensions, but officials ultimately said there were no legal opinions or
findings to back up the interpretation.
On Thursday, after the Globe inquiries, the board abruptly reversed its
position on the pensions, rejecting one for recently retired state
representative Paul C. Casey, a Democrat from Winchester. Casey, 48,
stood to gain an extra $315,000, under an estimate by the Globe.
Patrick has called on the Legislature to make changes in public pension
laws that he says would restore fairness, including removal of a
provision that allows lawmakers and other elected officials to receive a
full year of credit toward a pension even when in office only one day in
a calendar year.
The Globe found that at least 52 retired legislators took advantage of
that measure to boost their lifetime pensions by about $16,350 each.
Both the Senate and House produced bills, but legislative action has
stalled since then.
"My message to the Legislature is: Get it done," the governor said. "Get
it done. The public is losing patience. I'm losing patience."
Both House and Senate versions would eliminate the enhanced early
pensions taken by the legislators detailed in the Sunday Globe. But
Patrick said he backs the Senate bill, which would apply to current
public employees and close loopholes, including the elimination of
pension credit for municipal positions that are unpaid.
The Senate would also restrict pensions of MBTA employees, who are now
eligible to collect retirement benefits after 23 years of employment.
The House version would exempt current employees, while changing the
rules for new hires.
Senate President Therese Murray called yesterday for officials to
closely scrutinize the pensions awarded to the former lawmakers detailed
in the Globe.
"If the Retirement Board determines that any of the lawmakers in
question were not eligible for these pensions under the old law, then
they should be rescinded," she said in an e-mailed statement.
The Boston Globe
Monday, May 5, 2009
A Boston Globe editorial
New day, new pension scandal
The absurd state law that allows legislators turned out of their jobs by
the voters to collect enhanced pensions is bad enough. Now Globe
reporter Sean Murphy has found that 10 former state lawmakers were able
to snare early pensions without having lost election, thanks to
favorable arrangements with the state Retirement Board.
The 1950 law allows enhanced pensions for legislators if they lose an
election or fail to qualify for the ballot. But the 10 legislators in
the Globe report who got retirement benefits - most when they were in
their 40s - left their seats voluntarily.
"The statute is fuzzy," said Joseph Connarton, executive director of the
Public Employee Retirement Administration Commission.
As a result of fuzzy law, these 10 ex-lawmakers are the beneficiaries of
not-so-fuzzy math. According to Globe calculations, if they live to age
80, they will enjoy pensions worth an average of $300,000 for each
legislator over the lifetime of the benefit.
The Retirement Board, which is chaired by state Treasurer Timothy
Cahill, has so far provided no legal opinions or findings to back up
these pension decisions.
Joseph D. Malone, who was state treasurer in 1991, when immediate
pensions for voluntarily departing legislators were first approved, now
suffers from hazy memory syndrome. He can't remember what happened back
then. "It was a long time ago," he told the Globe.
Cahill is also showing signs of not-my-problem syndrome. In a statement
to the Globe, he first suggested these pensions are a stretch under the
law. But he also said he can't speak for pensions that were approved
before his election.
That leaves it to Governor Patrick to demand action. He is asking his
legal counsel to work with the state treasurer and attorney general to
look into rescinding the pensions.
The governor is right. If the special pensions were improperly awarded,
they should be rescinded.
So, whose job is it to make that determination? Since the state
Retirement Board voted to approve the pensions, the board should put the
issue back on the agenda and consider whether those prior votes were
faulty. It would also make sense to refer the question to Attorney
General Martha Coakley. As the Commonwealth's top lawyer, it's her job
to interpret state law.
The law may be fuzzy, but one thing is crystal clear. This looks like 10
more cases of Beacon Hill taking care of Beacon Hill. Day by day, abuse
by abuse, it adds up.
The Telegram & Gazette
Tuesday, May 5, 2009
A Telegram & Gazette editorial
Puffy pensions
Lawmakers abusing 1950 rule
The latest chapter in outrage from the state’s festering public-pension
scandal is a Boston Sunday Globe report detailing how 14 former state
legislators are enjoying enhanced pensions under a 1950 law amendment
that extends to lawmakers a protection originally designed for state
workers. The report notes that 10 of those individuals may not even
qualify for early pensions under the law.
The original 1945 law was intended to protect workers with 20 or more
years of service in the event they were dismissed by a subsequent
administration intent on hiring its own supporters and partisans into
state jobs. Five years later, in 1950, the Legislature made itself
subject to the law’s provisions, thereby protecting its members who
might lose an election. While that amendment alone stretched the law’s
original intent almost beyond recognition, its spirit has clearly been
violated outright in the years since with the granting of pensions to
lawmakers who have not been defeated at all, but simply chose not to
seek re-election.
The perks made available to the legislators included in the Globe report
could wind up costing taxpayers $3 million.
Almost as disturbing as the twisting of the law at the public’s expense
is the reaction of former state officials who had a hand in creating
such abuses.
Joseph D. Malone, who was auditor [sic - treasurer] in 1991 when the
Retirement Board first approved such pensions for legislators who
voluntarily left office, told the Globe he couldn’t remember much about
it.
And former state attorney general Francis X. Bellotti, asked about
another pension perk — the one that credits lawmakers for an additional
year of service for serving just one day in a new calendar year — called
the creation of that measure “a straight statutory interpretation.”
The Legislature is finally taking aim at the “one day, one year” rule,
but we have to wonder how many other arcane provisions lie buried in the
thicket of some 500 pages of rules and amendments that constitute
Chapter 32 of our state laws, governing pensions.
The Legislature that created and profits by such abuses cannot be
counted upon to remedy them.
State Treasurer Timothy P. Cahill, who oversees the Retirement Board,
hinted to the Globe at an “improper” interpretation of the pension
rules. We hope he has the political courage to apply common sense to
this situation and score a small but satisfying victory for taxpayers. A
commission to tear down the state’s pension system and rebuild it in a
logical, common-sense fashion would be still more welcome.
The Boston Herald
Friday, May 1, 2009
Gov’s anti-tax stance mustn’t be just an act
By Jim Stergios
One day. That’s all it took.
We wait years for pension reform. Years for the state to reform health
care purchasing. Decades for elected officials to shrug off the embrace
of public employee unions. And still none of it is done.
But increase the sales tax? All it takes is a day.
On this one, the governor is right. He sent the House a letter promising
to veto any sales tax hike before critical reforms are passed. This
reasonable request offended House members’ sense of sovereignty, the way
U.S. interference in a Central American election would offend that
country’s population. The governor’s letter was an act of gamesmanship,
but what’s wrong with that? Yes, he got religion late in the game. But
he got it.
The Senate has talked reform before revenue, but its transportation bill
didn’t deliver. The House did less. Perhaps that’s because the initial
House budget sagged under the weight of public employee union pressure.
The result will almost inevitably reinstate provisions like the Quinn
Bill.
Reforms take decades - if they ever happen. A $1 billion tax increase
takes a day.
The governor needs to stand firm. To use a theatrical metaphor, he needs
to prove he isn’t part of the tired tradition of Kabuki theater that has
dominated Beacon Hill for decades. He must prove a master of the other
Japanese theatrical tradition - Noh, as in “no.”
That will require that his new slogan of “meaningful reform” is, well,
meaningful. Needed actions include reducing the state’s work force.
Municipalities have been doing that, so why not the state? We need to
remove state mandates so local leaders have the power to make decisions
on employee health-benefit purchasing. We need to let communities opt
out of providing incentives to cops for doing what we all do - develop
professionally. We need to end corporate welfare for the biotech and
film industries.
On transportation, it means reforms that enhance transparency by
measuring performance and putting the results online. It means fixing
before building It means using excess borrowing capacity to defease Big
Dig debt.
But the hard part is that it also means cutting expenses. Reducing costs
means transportation employee-pension and health-care reforms. And
getting rid of inflated prevailing wage agreements, having MassHighway
provide the bulk of road and bridge work for the state’s parks agency,
and allowing public-private partnerships.
None of that is easy. But neither is it easy for taxpayers to dig
deeper.
The curtain has come down on the House’s first act of disrespect to the
voters. We await the Senate’s second act, but without much hope. The
final act may lie with the governor.
The 108-51 margin by which the House passed the sales tax increase is
barely veto-proof. The question for Deval Patrick is whether his
first-term rehearsal has molded a first-rate actor.
The question for us is whether he and legislators should be re-elected.
Jim Stergios is executive director of Pioneer Institute.
The Telegram & Gazette
Sunday, May 3, 2009
A Telegram & Gazette editorial
A fraying contract
Of reforms, the ballot box and decline
The idea of a social contract as the basis for a government that
provides for public order and good has been around for well over 200
years, but as Massachusetts continues to experience declining revenues,
it is worth examining the roles voters and officials are playing in
keeping that contract in force.
Whatever they may say between elections, Massachusetts residents
regularly go to the polls and endorse the broad notion of exchanging
some of their liberties and treasure for a government that ensures a
basic safety net. Few are arguing that government should do none of the
difficult and socially useful work it engages in. As one might expect, a
budget season that brings such dire revenue projections has witnessed a
steady stream of supplicants making their way to Beacon Hill to press
for funding for their departments and programs.
The difficulty lies in this: Many of the lawmakers who are justly
heralded as champions for one group or another are the same people who
steadfastly refuse to vote for radical and desperately needed reforms in
state hiring, ethics rules and pensions. The large Democratic majority
treats amendments offered by a vanishingly small number of Republicans
with disdain, as if the majority party were possessed of a monopoly on
wisdom and determined to guard it jealously.
Meanwhile, Gov. Deval L. Patrick, a man only sporadically inclined
toward reform, finds his agenda hamstrung by an unfortunate and
apparently incurable habit of making ill-timed patronage hires.
In the end, however, fault lies not so much with a weak Republican Party
or governor as with a majority party that is prone to forget that the
health of the social contract depends on securing the consent of the
governed every day, not just on Election Day.
Our lawmakers have simply not done the hard work of reform, while
spending too much of our treasure on positions and perks that should not
exist. They seem to be betting voters will eventually accept new taxes
and fees as the price that must be paid for the government they
evidently relish.
That bet may be correct, but no tax increase can offset the poison of
deep-seated government waste. Household and statewide economies can only
take so much. By failing to enact reforms, our leaders are breaking
faith with the broad spirit of the social contract. And, harsh as it
sounds, voters who fail to hold them accountable are complicit.
Associated Press
Sunday, May 3, 2009
Mass. court to hear controversial
N.H. tire sales tax case
A sales tax battle between a tire company and the state Department of
Revenue is headed to the highest court in Massachusetts.
At issue is a claim that Town Fair Tire Centers sold tires in New
Hampshire to customers who appeared to be from Massachusetts, but did
not collect the 5 percent sales tax that would have been levied if the
tires were sold in Town Fair’s Massachusetts stores.
The company is appealing a ruling from the state’s Tax Appellate Board,
which agreed that the company should have collected $109,000 in
Massachusetts sales taxes.
The Supreme Judicial Court is scheduled to hear arguments Thursday.
Some think the ruling could have a broad impact and force Massachusetts
residents to pay their state’s tax on everything they buy in tax-free
New Hampshire.
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