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The Lowell Sun
Tuesday, April 27, 2010
House has no appetite to change Prop. 2½
By Matt Murphy
House leaders backed off a proposal to allow communities to raise
property taxes beyond the 2.5 percent annual cap in order to pay for
tax abatements without a fight, striking it from a larger
municipal-relief bill aimed at helping cities and towns manage their
local budgets in the face of state-aid cuts.
House Speaker Robert DeLeo, responding to widespread criticism from
Republicans and members of his own party, stripped the controversial
proposal from the bill. Instead, he allowed an amendment offered by
Republican leadership to sail through as the House began debate on
the larger package of reforms.
The concession staved off a potential showdown between the House and
Gov. Deval Patrick, who threatened last week to veto the bill if the
change to Proposition 2½ reached his desk.
Voters in 1980 approved Proposition 2½, limiting the annual increase
of property taxes by municipalities to 2.5 percent of the previous
year's levy, plus new growth. Last week, a key House committee
advanced a proposed change to the law that would have allowed towns
to raise money beyond the 2.5 percent cap to fund a revolving
overlay account used to pay property-tax rebates for homeowners.
House Ways and Means Chairman Charlie Murphy, D-Burlington,
adamantly defended the proposal, which he wrote as a way for cities
and towns to better manage their budgets. He denied that the change
"equated to a tax increase," and said it would not alter the basic
protections of Proposition 2½.
"Charlie Murphy is adamantly wrong," mocked House Minority Leader
Brad Jones when asked about Murphy's defense. "They'll probably
admit that they didn't do a good job explaining why this wasn't a
tax increase, because it is."
As House lawmakers learned of the proposal late last week, many
Democrats joined their Republican colleagues in coming out against
the plan, pointing to the speaker's own pledge that the House budget
would not include any new taxes.
"Anything tinkering with Proposition 2½ that could result in a tax
increase at this point in time is ludicrous," said state Rep. Kevin
Murphy, D-Lowell.
Cities and towns across the commonwealth set aside $164.4 million to
pay for tax rebates and exemptions in 2010.
State Rep. Thomas Golden, D-Lowell, reiterated his opposition to the
plan and said he is pleased that leadership did not fight to keep it
in the bill.
"It had no business being in there in the first place," Golden said.
"People right now can't afford any increase to their property
taxes."
DeLeo issued a statement last week citing his opposition to
tinkering with Proposition 2½, but did not explicitly close the door
on the adjustment for overlay accounts. DeLeo spokesman Seth Gitell
yesterday referred to that original statement any questions about
the speaker's decision to pull the provision back.
The larger municipal-relief package passed the House unanimously but
failed to address the one thing municipal leaders have been crying
out for -- health-care plan design.
Local leaders, including Lowell City Manager Bernie Lynch, have been
pressing for the power to make changes to employee health-benefit
plans without collective bargaining, the same authority the state
has over its employees.
But the relief bill did not address plan design.
The bill would give cities and towns a number of local options to
save money next year as they prepare to absorb a 4 percent cut to
local aid. Provisions in the bill include:
●
Extending the schedule to fully fund local pension plans from 2030
to 2040.
●
Allowing municipalities to enter into 30-year leases without
legislative approval, an increase of 10 years.
●
Allowing cities and towns to join a statewide mutual-aid agreement
to provide assistance to neighboring communities for police, fire
and EMS services.
●
Offering early retirement to municipal employees with at least 20
years of service, excluding teachers.
Earlier in the day, Republican gubernatorial candidate Charlie Baker
and his running mate, state Sen. Richard Tisei, joined Barbara
Anderson, executive director of Citizens for Limited Taxation,
in criticizing one-party leadership on Beacon Hill.
Anderson first brought attention to the issue of property taxes last
week, prompting Baker, Patrick and Treasurer Tim Cahill, an
independent running for governor, to come out against the overlay
exclusion.
"They didn't think anyone would notice," Anderson said yesterday at
a press conference on the steps of the Statehouse.
Baker said the first impulse of Democrats is to raise taxes instead
of cutting the budget and living within their means.
"It's troubling that we have to continually fight to protect
Proposition 2½," Baker said.
Baker reiterated his support for rolling back the state income tax
from 5.3 percent to 5 percent, and the sales tax from 6.25 percent
to 5 percent. He said he hopes to accomplish both goals within his
first term as governor. He also said he would eliminate 5,000 jobs
in the executive branch.
Patrick responded by criticizing Baker for failing to tell voters
what services he plans to cut to make up for the loss in revenue.
Associated Press
Monday, April 26, 2010
House votes to scrap tax plan to skirt Proposition 2½
By Steve LeBlanc
The Massachusetts House voted yesterday to scrap a proposal that
critics said could have raised property taxes by as much as $500
million.
The measure, which would have let cities and towns raise taxes above
the limit set by Proposition 2½ to pay property tax abatements, came
under fire from Gov. Deval Patrick, who said he would not sign a
municipal-relief bill if the measure was included.
Patrick's top opponents in the race for governor, Republican Charles
Baker and independent Timothy Cahill, also said they were against
the plan.
Prop. 2½ was approved by voters in 1980 and radically changed the
way cities and towns raise taxes to pay for municipal services. It
limits communities from raising property taxes by more than 2.5
percent a year over the previous year's levy (plus a factor for "new
growth") without approval from voters.
The now-defeated change would have allowed communities to increase
the allowed levy by the amount in the community's overlay account.
The money in that account goes to citizens who successfully win tax
abatements. Money left over in the account can be used for anything
at all, according to Barbara Anderson, whose group
Citizens for Limited Taxation helped push through Prop. 2½.
Anderson said lawmakers were trying to slip through what would
effectively be an end run around Prop. 2½.
"They didn't think anyone would notice," Anderson said yesterday at
a press conference with Baker on the Statehouse steps. "We think
we've gotten them to back down."
Rep. Joyce Spiliotis, D-Peabody, co-sponsored an amendment with
House Minority Leader Brad Jones of North Reading to strike the
language from the municipal-relief bill.
"The handwriting was on the wall," Spiliotis said. "We struck the
language because they knew they wouldn't have the votes to pass it."
Spiliotis couldn't believe what she was reading when going through
the portion of the municipal relief package that dealt with
Proposition 2½. She even asked her legislative aide to read it also.
"Nobody saw the language until the bill came out," Spiliotis said.
Legislators in a conference committee hammered out the details of
the bill although there were hearings on portions of the bill.
Rep. Brad Hill, R-Ipswich, agreed.
"Most of the legislators didn't understand (the proposal) when it
came out that it could be perceived as a back way of raising taxes
without representation from the citizens of the community," Hill
said. "For those reasons, (not adopting the proposal) was the right
thing to do."
If legislators want to change Proposition 2½, Hill said the House
needs "to have a discussion that's public and not something thrown
into a very big bill."
"(Citizens in my district) were very concerned this was a way to
increase taxes, and this did not sit well," Hill said.
The question of whether to give cities and towns more flexibility on
property taxes comes amid a larger debate about when to raise or cut
taxes.
Baker seized on the opportunity to renew his call for lower taxes.
Baker said if elected he would try to lower the state income tax
rate from 5.3 percent to 5 percent. He said he'd also try to roll
back the state sales tax rate from 6.25 percent to 5 percent.
"My goal would be to do it within my first term," he said. "It's
obviously a function of a lot of moving parts."
He said lowering the two taxes would create a $1.4 billion budget
hole. He said he would close that hole by eliminating 5,000 jobs in
the executive branch, or about 10 percent of the total, and by
"dramatically streamlining state government's operating model."
Baker stopped short of endorsing a proposed question for the
November ballot that would lower the sales tax rate to 3 percent.
Baker said that would make it virtually impossible for him to avoid
local aid cuts.
Paul Loscocco, running for lieutenant governor on the same ticket as
Cahill, faulted Baker's running mate Sen. Richard Tisei for voting
against an income tax rollback in 2000.
Tisei said he voted over a dozen times to roll the income tax back,
but on one occasion voted against it because he was concerned about
local aid. He said he's since learned the best thing to do is to cut
off increased revenues so state government will stop spending.
Not everyone on Beacon Hill was pushing for lower taxes.
In his proposed $28.2 billion state budget plan, Patrick called for
increasing taxes on candy and soda and smokeless tobacco.
House leaders said their version of the budget doesn't include any
tax increases, although individual members are pushing for
additional revenue.
Staff writer Bruno Matarazzo Jr. contributed to this report.
The Boston Herald
Tuesday, April 27, 2010
House KOS bid to kill Prop 2½
Plan lacked support
By Edward Mason
Embattled House leaders yesterday dropped a controversial plan to allow
communities to ignore limits on property tax hikes proscribed by
Proposition 2½.
A spokesman for House Speaker Robert A. DeLeo said the tax-hike plan
rolled out by Ways and Means chief state Rep. Charles A. Murphy didn’t
have the support of leadership.
“The speaker has consistently said he doesn’t support any tax increase
or any weakening of Proposition 2½,” said DeLeo spokesman Seth Gitell.
The provision was contained in a so-called municipal-relief bill passed
last night, aimed at helping beleaguered cities and towns cope with an
anticipated $234 million local aid cut. Citizens for Limited Taxation
estimated it would have cost taxpayers as much as $500 million.
However, proponents said it would have allowed communities to raise
property taxes above the 2½ limit to pay for abatements when homeowners
successfully appeal their tax bills.
The measure was stripped out by an amendment filed by Republicans, who
with anti-tax activists called the scheme an end-around Proposition 2½.
House Republican Leader Brad Jones (R-North Reading) called it a
“significant step to protect the wallets of taxpayers.”
Gitell said the item will not resurface in the fiscal 2011 budget the
House debates this week.
Gov. Deval Patrick had pledged to veto the bill if the measure was
included, and Senate President Therese Murray said she would oppose it
in the Senate.
Propositon 2½ was approved by voters in 1980. Cities and towns can’t
hike property taxes by more than 2.5 percent a year without voters
approval.
The municipal bill passed by the House contains a number of provisions
aimed at saving cash-strapped cities money, including allowing
communities to delay fully funding their pension obligations and
encouraging early-retirement programs but requiring positions be filled
by lower-wage workers.
New England Cable News
Monday, April 26, 2010
Candidates for Mass. Governor spar over taxes
(NECN: Alison King) - This week Massachusetts
candidates for Massachusetts Governor weigh in on how they would handle
taxes if elected to office.
Sen. Bruce Tarr (R-Gloucester): We continue to see things like proposed
increases on alcohol, candy, soda and the list goes on and on and on.
It is the time tested and reliable way for Republicans to score points
in Democratic dominated Massachusetts: Rail against taxes and one party
rule.
Which is why candidate for Governor, Charlie Baker joined Republican
lawmakers in the fight against a Democrat sponsored bill that opponents
says could raise property taxes by as much as $550 million dollars this
year without voter approval.
Charlie Baker: This is what happens when one party's in charge on Beacon
Hill. The impulse, the first impulse when times get tough is not to cut
the budget, not to reform the way things work, not to find a less
simpler, less expensive way of doing business, but instead, to push the
tax button.
Two of Baker's lead opponents, Democrat Deval Patrick and Independent
Tim Cahill, have the same stance on the Prop-2½ proposal: They are also
against it, but that didn't stop Baker from enlisting anti-tax advocate
Barbara Anderson to hammer home his message.
Barbara Anderson: This year, when voters are so angry, when the
tea partiers are partying when people have really had enough, the last
thing I expected was them to do was attack proposition 2½.
Just before Baker's news conference, word got out from House Speaker
Robert DeLeo's office that the controversial proposition 2½ provision
will be taken out of the municipal relief bill - sparking Republicans to
claim victory -- then weigh in on other taxes they'd slash.
Baker: We should get the income tax back to five percent. Something Tim
Cahill and Deval Patrick were both opposed to.
Baker also says the sales tax should be rolled back to five percent --
and he says he'd aim to do it in his first term.
Patrick: I have seen more examples of a lack of integrity out of that
campaign and this is just another one. Until they start talking about
what services they're going to cut, then we're not going to have a
serious conversation.
Governor Patrick says he would also like to rollback some taxes -- but
not until the economy recovers.
Tim Cahill: I support rolling back both the income tax and the sales tax
to five percent as soon as possible. I'm also looking at corporate and
capitol gains to make the state more competitive.
Tim Cahill is playing second fiddle to no one when it comes to cutting
taxes:
Charlie Baker says he'd roll back taxes by about 1.4-1.5 billion dollars
in his first term.
The Boston Globe
Tuesday, April 27, 2010
GOP launches ad attack on Cahill
Candidates swap charges over taxes
By Michael Levenson
The Republican Governors Association, hoping to clear a path for Charles
D. Baker, will launch a hard-hitting television and radio ad campaign
today targeting state Treasurer Timothy P. Cahill, an independent who is
trying to outflank Baker on the right in this year’s governor’s race, a
spokesman for the association said yesterday.
The ad campaign, the first major ad buy of the gubernatorial contest,
was made as Baker and Cahill battle to become the prime alternative to
Governor Deval Patrick, who polls suggest is vulnerable.
“We’re going to be making the argument that Tim Cahill is just like
Deval Patrick, but worse, with regard to his record on fiscal issues and
being reckless with taxpayer money,’’ said Tim Murtaugh, a spokesman for
the association.
Murtaugh declined to say how much the group was spending on the ads, but
said it was a significant sum that would pay for airtime on cable and
broadcast television, as well as radio.
The ad campaign, he said, was not coordinated with the Baker campaign,
in keeping with federal campaign finance laws that prohibit independent
groups from buying ads on a candidate’s behalf.
The organization chose to run the ads in Massachusetts “because we’re
paying close attention, and we think it’s a good opportunity for a
pickup,’’ Murtaugh said.
Cahill’s political director, Jordan Gehrke, wrote on Twitter last night
that the ads showed that Republicans are desperate after a poll last
week showed Cahill in second place behind Patrick.
The association ran a similar ad last year when the GOP candidate in the
New Jersey governor’s race, Christopher Christie, was in a three-way
battle. That ad also took aim at the independent candidate, Christopher
Daggett, accusing him of being like the incumbent Democratic governor,
Jon Corzine, “only worse.’’ Christie eventually won the race.
The ad targeting Cahill hits the airwaves as Patrick, Baker, and Cahill
are trading some of their sharpest jabs to date over taxes and spending,
and as House lawmakers take up a series of controversial tax measures.
Patrick took particular aim at Baker yesterday, accusing him of pushing
lower state income and sales tax rates without explaining what programs
he would cut to offset the loss of approximately $1.4 billion in annual
revenue.
“I have to tell you, I have seen more examples of a lack of integrity
out of that campaign, and this is just another one,’’ the governor told
reporters, hours after Baker held a press conference outside the State
House to blast Patrick for his fiscal management.
“Until they propose what . . . the public will do without, then we’re
not going to have a serious conversation,’’ Patrick said, according to
State House News Service.
At his press conference, Baker said he would cut 5,000 jobs, or about 10
percent of the executive branch, and begin “dramatically streamlining
state government’s operating model.’’ But he did not say which programs
or agencies would be targeted for reductions.
Instead, Baker and his running mate, Senate minority leader Richard R.
Tisei, reiterated their vow not to increase taxes and criticized Patrick
for signing an increase in the sales tax, from 5 percent to 6.25
percent, to help close a state budget gap last year.
“This is what happens when one party is in charge on Beacon Hill,’’
Baker said. “The first impulse when times get tough . . . is to push the
tax button. The first impulse should be to reform.’’
Cahill fired back at Baker by releasing a statement slamming Tisei for
voting against a proposed reduction in the state income tax in 2000.
“The dog-and-pony show today from the Baker campaign was a little
amusing, considering Baker’s running mate, Richard Tisei, was the only
Republican to vote against the income tax rollback in 2000,’’ said the
statement from Cahill’s running mate, Paul Loscocco. “If the Baker
campaign wants to focus this debate on the candidate’s records on tax
cuts, we are happy to have that conversation.’’
Cahill, like Baker, said he supports reducing the income tax from 5.3
percent to 5 percent and the sales tax to 5 percent.
Tisei, a Wakefield Republican, said he has voted to lower the income tax
more than a dozen times but voted against it in 2000 because he was
concerned about cutting local aid. He suggested he now regrets the vote.
The back-and-forth over taxes was ignited after House Ways and Means
chairman Charles A. Murphy proposed a measure last week that would have
allowed cities and towns to raise taxes above the limit set by
Proposition 2½ to pay for property tax abatements.
Republicans said that the change could have increased property taxes by
as much as $500 million. Patrick, Baker, and Cahill all oppose the
measure, as does Senate President Therese Murray, who said yesterday
that she, too, would oppose any such change. Yesterday, House lawmakers
quietly killed Murphy’s plan on a voice vote without debate.
The House was slated yesterday to debate other measures pushed by a
small band of Democrats that would remove the sales tax exemption for
candy and soda, mirroring Patrick’s proposed budget for the upcoming
fiscal year, and increase the tax on stock dividends and interest from 5
percent to 12 percent, a rate last used in the 1990s.
Supporters said the taxes would generate about $550 million to stave off
deep cuts in public health programs, local aid, and other areas.
The House, however, is expected to reject the tax increases, said Seth
Gitell, a spokesman for Speaker Robert A. DeLeo, who has pledged not to
raise taxes in the House’s proposed budget for the upcoming fiscal year.
State House News Service
Monday, April 26, 2010
Daily State House Schedule
[Excerpt]
11:00.....BAKER-TISEI PRESS CONFERENCE: Republican candidate for
governor Charles Baker and running mate Sen. Richard Tisei will join
Barbara Anderson, executive director of Citizens for Limited Taxation,
for a press conference. The Baker-Tisei campaign is calling it a "One
Party Rule Run Amok Press Conference".....State House steps.
11:30.....NEW TAXES:
ONE Massachusetts
and members of more than a dozen other groups hold a press availability
in favor of Rep. Matt Patrick’s amendments to the House budget to add
new taxes aimed at supporting services.
In a letter to colleagues, Patrick urged them to support proposals to
eliminate the sales tax exemption on soda and candy to generate $51.7
million for public health programs. Another amendment would increase the
tax rate on investment interest and dividends to 12 percent, with an
exemption for moderate income families, to raise $500 million.
Groups supporting the amendments include the Massachusetts Teachers
Association, the Coalition Against Poverty, the Coalition for Social
Justice, the Boston Parent Organizing Network, the Massachusetts
Community Action Network, the Mass Society of Professors at UMass
Amherst, Mass Home Care, Project RIGHT, Yes! Northampton, Health Care
for All, the Massachusetts Public Health Association, the Public Higher
Education Network of Massachusetts and New England United for
Justice.....Outside of the House Chamber.
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