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CLT UPDATE
Sunday, October 6, 2019

Proposition 2˝ again under attack


PROP 2˝ (S-2350)

Senate 34-4, approved an amendment requiring the Department of Elementary and Secondary Education to analyze the impact of Proposition 2˝ on the ability of municipalities to make their required local contributions in the short-term and long-term and recommendations to mitigate the constraints of Proposition 2˝.

Prop 2˝ allows communities to raise property taxes only 2.5 percent a year over the previous year’s levy. The limit can be overridden by a majority of voters.

Amendment supporters said many cities and towns are willing to step up and to tax themselves more to pay for vital services but Proposition 2˝ puts a cap on that. They said that once the levy limit is reached, towns have no ability to raise revenue to pay for services and have to start laying people off and cutting services.

“Since the moment I began campaigning, I heard about the pressure that multiple municipalities in my district are under as a result of Prop. 2˝ constraints,” said the amendment’s sponsor Sen. Jo Comerford (D-Northampton). “A major driver of municipal expenses has been education. These towns want to go the distance for our schools, and so it is only fitting that we use this education legislation to understand the impact Prop 2˝ is having on their ability to help fund our schools, and then work with these communities to find an equitable way forward.”

"Proposition 2˝ caps property tax hikes unilaterally imposed by municipal officials at 2.5 percent, but there is no limit to how much willing municipal taxpayers can tax themselves through a Proposition 2˝ operational override — if a majority of the city’s or town’s electorate is so inclined," said Chip Ford, executive director of Citizens for Limited Taxation (CLT), the group that created and put Prop 2˝ on the 1980 ballot. "If those officials want to spend more, let them ask their constituents for more to spend. This is precisely why CLT proposed its property tax cap and why voters overwhelmingly adopted it. They can 'study the impact' but a solution is in their hands."

Beacon Hill Roll Call
Volume 44 - Report No. 40
By Bob Katzen
September 30-October 4, 2019


EDUCATION FUNDING: Question came on ordering S-2350 relative to educational opportunity for students redrafted by the Ways and Means Committee to a third reading.

COMERFORD AMENDMENT 27 - Analyze Impact of Proposition 2˝ . . .

BY A ROLL CALL VOTE OF 34-4, the amendment was ADOPTED. Time was 6:24 p.m.

State House News Service
Thursday, October 3, 2019
SENATE SESSION – THURSDAY, OCT. 3, 2019


UNIVERSAL BASIC INCOME (UBI) OF $1,000 PER MONTH (S-84)

A bill before the Community Development and Small Businesses Committee would establish and implement a 3-year pilot program that gives 100 individual participants $1,000 per month to determine the individual, family and community economic impacts and state-level cost savings of a universal basic income. The participants would be from economically diverse cities or towns, including rural areas.

The program would then issue a report including the plusses and minuses of basic universal income; how it could be used to address historic and contemporary inequalities including institutional racism; and recommendations on implementing a statewide UBI program.

“The UBI bill provides individuals with financial relief and choices that are not possible with their current financial situation,” said the bill’s sponsor Sen. Jamie Eldridge (D-Acton). “It eliminates the bureaucracy of government-provide benefit programs.”

Supporters say it is time to try a pilot program of this often-discussed concept and then analyze it and see how it worked. They say UBI could be a key to alleviating poverty and note it would help workers impacted by job automation and provide Americans with a safety net.

They point out that a recent study from earlier this year on Finland’s UBI pilot program found that recipients reported greater general well-being, less stress, improved physical and mental health and an increase in confidence about having a bright future.

Democratic Presidential candidate Andrew Yang is a big supporter of UBI and it is one of the cornerstones of his campaign.

Chip Ford, executive director of Citizens for Limited Taxation is not big on the idea, to say the least. “Will selecting The ‘Lucky Hundred Pilots’ work out as well as the low-number license plate lottery, where many winners are seemingly connected to how much they contribute to whom?” asked Ford. “What an insane idea, even for Massachusetts. We’re told the state has a ‘revenue shortage’ and needs to raise taxes, but incredibly, legislators now want to give away even more working stiffs’ hard-earned money on such foolishness. The breaking point is quickly approaching, let’s speed it along.”

Beacon Hill Roll Call
Volume 44 - Report No. 40
By Bob Katzen
September 30-October 4, 2019


With the second quarter of the state's fiscal year set to open on Tuesday, the Massachusetts Legislature still has not closed out the books on the budget year that ended three months ago.

Massachusetts taxpayers delivered more than enough revenue to run state government in fiscal 2019, but legislators have yet to decide how to use the surplus.

Former Comptroller Thomas Shack for years tried to remind lawmakers of the importance of taking timely action on a so-called "closeout supp," but lawmakers in recent years have opted to wait longer and longer to pass that bill, taking it up in October or even November, rather than August or September as they used to do in the late 1990s and early 2000s.

The comptroller must close the books on the fiscal year that ends each June 30 and file the annual Statutory Basis Financial Report by Oct. 31. To adhere to that schedule and follow industry best practices, a final supplemental budget should be approved by Aug. 31 each year, Shack had argued.

State House News Service
Monday, September 30, 2019
Last year's spending choices still unresolved on Hill


With a new tax to fund the state's paid family and medical leave program set to take effect Tuesday, Gov. Charlie Baker rejected calls by the state's largest public union to relieve state employees of the obligation to pay into the system.

The National Association of Government Employees, which has more than 22,000 members in Massachusetts government, slammed the Baker administration this month for not covering employees' share of the new payroll tax as other public employers, including both the House and Senate, reportedly did.

Baker said Monday that he disagrees with their criticism and believes all state employees should contribute to the program.

"Our view is that state government, like everybody else, should comply with the law," Baker told reporters after a groundbreaking event in Quincy. "The law was basically the part of a bargain between advocates and labor unions and the Legislature, and I think it's important for state government to abide by the law that is going to apply to everybody else. I think that's only fair."

The $800 million program — outlined in the "grand bargain" law that Baker signed last summer to avert several ballot questions — will allow employees to take up to 12 weeks of paid leave to care for a new child, tend to an ill family member, or cope with a loved one's active military deployment. Workers can also take up to 20 weeks to recover from a serious illness or injury or to care for a service member who is ill or injured.

Benefits to care for a new child or sick service member or to manage a health issue become available on Jan. 1, 2021, while paid leave to care for ill family members will become available on July 1, 2021. Employees would be capped at receiving $850 per week in pay while on leave.

State House News Service
Monday, September 30, 2019
Baker: State employee leave contributions "only fair"


The states are also eyeing a 10-year horizon for the program that will include a cap on emissions from both sources of motor fuel that begins in early 2022 and ratchets down every year through 2032, according to state energy officials and advocates.

The Transportation Climate Initiative [TCI], which is a multi-state coalition working to build a program to reduce carbon pollution from the transportation sector, released a draft framework of the program Tuesday....

Gov. Charlie Baker in late 2018 committed Massachusetts to the TCI along with 11 other states and the District of Columbia in an effort to tackle climate change throughout the region, not just Massachusetts.

Modeled on the Regional Greenhouse Gas Initiative that targeted emissions from power plants, TCI states are focused on developing a cap-and-invest program to drive down emissions from cars and trucks and facilitate the transition to a low-carbon transportation system.

The states currently involved are Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, and Virginia....

State fuel suppliers who transport fuel across state lines will be the entities to hold and trade emission allowances based on cap levels that still must be set. Theoharides said there are hundreds of these suppliers across the 13 TCI jurisdictions.

"Fuel suppliers would have to report their emissions and their compliance would be calculated based on how much emissions their fuel would produce when combusted," Theoharides said....

Where the cap is set and how fast it declines will signal how aggressive states want to be in reducing emissions and how much money will be generated from the sale of allowances for states to invest in low-carbon transportation options and how much more consumers will end up paying for gas.

The state chapter of the National Federation of Independent Business pointed to a study that found a similar cap-and-trade program in California targeting refinery emissions added 13 to 14 cents to a gallon of gas.

"Will (Massachusetts) suffer the same fate?" the group asked on Twitter....

In legislation filed by governor in July, Baker proposed to earmark half of the revenue Massachusetts receives through TCI for the MBTA.

State House News Service
Tuesday, October 1, 2019
Fuel suppliers at heart of Transpo initiative


But as senators prepared this week for a debate over $1.5 billion in new spending on public education, Gov. Charlie Baker thought it would be a good time to sprinkle a few numbers on the plate to season the discussion.

An analysis of the education funding reform bill, produced by the Department of Elementary and Secondary Education, looked like a fairly straight forward case of addition. Over the next seven years, the state's direct aid to cities and towns for schools would climb by over $2.1 billion, including inflation, to make up for years of underfunding....

The speaker, the Senate president and the authors of the bill all struck out at the governor, accusing him of deliberately releasing "misleading" data to muddy the waters the day before the Senate debate.

It's complicated, they said. The governor's numbers only paint part of the picture, they argued. You can't predict inflation or enrollment trends, they asserted.

The bottom line was that Democratic leadership preferred to explain the caveats to members behind closed doors rather allow a set of district funding figures that might be a little fluid to leave the public with the wrong impression. They didn't have better figures they were willing to share publicly, but they didn't like his. . . .

Climate activists would probably ban carbon if they could, but short of that 12 states and the District of Columbia put out a framework of a regional pact that would seek to drive down emissions from cars and trucks.

The states participating in the Transportation Climate Initiative said this week they would target motor gas and on-road diesel for a cap-and-trade program that would put a price on carbon in the transportation sector.

Fuel suppliers would be the ones buying and selling carbon allowances, but some business groups warned that it will still be drivers paying the price at the pump....

Energy Secretary Kathleen Theoharides has been playing a key role in wrangling the states, and she said details on the cap will be included in a draft memorandum of understanding to be released in December.

State House News Service
Friday, October 4, 2019
Weekly Roundup - Adding Up
Recap and analysis of the week in state government


The Legislature has 18 months every two years to hold formal sessions and take action on major bills. By Tuesday, the midway point in that 18-month journey, Massachusetts lawmakers had little to show in terms of major accomplishments, beyond laws helping public sector unions recover costs, enabling benefits to flow to families that have more children while receiving public assistance, and banning conversion therapy for minors.

The slow start is par for the course for the Legislature, which can't seem to break, or isn't interested in breaking, its habit of leaving its most important business to the final days and even minutes of formal sessions every other year. . . .

State House News Service
Friday, October 4, 2019
Advances - Week of Oct. 6, 2019


Chip Ford's CLT Commentary

The next assault on Proposition 2˝ was adopted by the state Senate this week, an amendment introduced to the Education Funding Bill that passed by a vote of 34 in favor to only 4 opposed.  There are six Republicans in the Senate.  We should have been able to expect at a bare minimum six "no" votes.  Pathetically too typical among Massachusetts RINOs, two alleged Republicans voted with the vast Democrat majority to the latest stealth assault on Proposition 2˝.

I'm fed up with those self-proclaimed "Republicans" who regularly put go-along-to-get-along "collegiality" ahead of positions and principles they profess to hold when running for election and re-election.  They can be dependably counted upon to spout flowery oratory at campaign stops, fund-raisers, and during floor debates, but when the votes are counted they are just as dependably on the wrong side of their rhetoric.

Senate Minority Leader Bruce Tarr (R-Gloucester) and Sen. Patrick O'Connor (R-Weymouth) voted to "analyze the impact of Proposition 2˝ on the ability of municipalities to make their required local contributions in the short-term and long-term and recommendations to mitigate the constraints of Proposition 2˝."  While their two votes wouldn't have changed the outcome, their two votes did provide a "bipartisan" stamp of legitimacy.

They sold out not only taxpayers and constituents but the Republican Party brand.

The only Republicans left standing in the Massachusetts Senate who defended Proposition 2˝ are Sen. Vinny deMacedo (R-Plymouth), Sen. Ryan Fattman (R-Sutton), Sen. Donald Humason (R-Westfield), and Sen. Dean Tran (R-Fitchburg).

AMENDMENT #27 / ROLL CALL VOTE #102

During the Thursday debate Sen. Eric P. Lesser (D-Longmeadow), a supporter of Sen. Joanne M. Comerford's (D-Northampton) amendment to weaken and compromise Proposition 2˝, said:

“. . . As a result, some of our lowest-income communities have higher property tax rates than many of our wealthy communities.  A lot of our towns are willing to step up and to tax themselves more to pay for these vital services but Proposition 2˝ puts a cap on that.

“The real-life consequence is once the levy limit is reached, towns have no ability to raise revenue to pay for services.  What happens is you hit the ceiling and cannot raise property taxes anymore and there are no more ways to collect additional revenue and yet other costs continue to rise.  Those towns have to start laying people off and cutting services. . . .”

This is simply not true.

Proposition 2˝ limits how much city or town officials can unilaterally increase its municipality's property tax (along with any additional new growth).  Preventing past such excesses was the very necessity and purpose of Proposition 2˝.  Municipal officials can now only increase its property tax levy by 2.5 percent a year its statutory “ceiling.”  Before CLT's Prop 2˝ was adopted, municipal officials regularly raised property taxes on a whim, with no consideration of taxpayers' ability to pay, or to resist and prevent.  If municipal officials wanted to increase taxes they simply just took it and they took it often and regularly.

There is also “excess capacity” to recognize, built into our law (see the State House News Service report below) which some municipalities have not reached, have not used all of that available 2.5 percent increase over the years and can use it to catch-up, so to speak.

Most importantly there is no limit to how much willing municipal taxpayers can tax themselves through a Proposition 2˝ operational override — if a majority of the city’s or town’s electorate is so inclined, or able to be convinced.  The only limit to how much more is how many property taxpayers are willing to impose a larger tax burden upon themselves and their neighbors.

A willing (if masochistic) majority can hike their (and their neighbors’) tax rate to a million bucks per $1,000 assessed value if that's what a callous majority wants – though they’ll never be able to sell their homes, or pay their first property tax bill and will lose them to the town.  But if enough voters have a sufficient death wish, under Proposition 2˝ they can so choose to commit and impose mass economic seppuku.

In the CLT Update of March 11 ("CLT saved motorists $1.3 Billion just last year") the State House News Service reported ("Property tax override attempts in Mass. at 30-year low"):

. . . The report also looked at a category known as "excess capacity," or the amount of additional taxes a city or town may collect without seeking to override Proposition 2˝, which limits local property tax increases. At $611 million, excess capacity has nearly tripled in the last decade. In fiscal 2018, excess capacity grew by $48 million, or 8.5 percent, the first time since fiscal 2010 that growth has not exceeded 10 percent.

Proposition 2˝ is all that stands between homeowners and local government confiscation.  It is perennially under attack.  The Socialist-Democrats would love nothing more than to repeal it and have been trying for decades, but for now they'll settle for watering it down if they can get away with it.  They're only proposing too "analyze the impact" for now.  But you know how their "analysis" will inevitably turn out.

And you know for a certainty what will surely follow, to "mitigate the constraints of Proposition 2˝."


Just when you think things can't possibly get any crazier on Beacon Hill along comes loony-left state Sen. Jamie Eldridge's proposal for "Universal Basic Income" (S-84).

$1,200,000 a year for three years handed out to 100 participant "pilots" to do nothing, $3.6 million over three years.  What could possibly go wrong with that?  The Beacon Hill pols will see how that works out then expand it.

$1,000 free money paid every month to The Lucky Hundred to "determine the individual, family and community economic impacts and state-level cost savings of a universal basic income . . . provides individuals with financial relief and choices that are not possible with their current financial situation.”

There's no word on how The Lucky Hundred will be selected but this being Massachusetts we can, of course, count on it to be all "above board," right?

"They say UBI could be a key to alleviating poverty and note it would help workers impacted by job automation and provide Americans with a safety net."

When everyone in the state is collecting their monthly "universal basic income" check who will be paying for it?

That must be U.S. Sen. Elizabeth Warren's favorite foil, those despicable one-percenters, again a diminishing number of those remaining behind to be further pillaged.

More likely, expanding free cash handouts will go to the pols' favored constituencies while the rest of productive taxpayers unable or unwilling to relocate will be further burdened to fund the vastly expensive handouts.

Chip Ford
Executive Director


 

State House News Service
Thursday, October 3, 2019
SENATE SESSION – THURSDAY, OCT. 3, 2019

EDUCATION FUNDING: Question came on ordering S-2350 relative to educational opportunity for students redrafted by the Ways and Means Committee to a third reading.

COMERFORD AMENDMENT 27 - Analyze Impact of Proposition 2˝

Sen. Comerford
said, thank you. What this amendment does is it requires DESE to consider the impact of Proposition 2˝ on local communities and their ability to make required local contributions.

Some of my towns and your towns are bumping up against the Prop 2˝ ceiling, and some of my towns have the highest tax rates in the commonwealth. The towns want to contribute to public education spending. They are, however, constrained. In Prop 2˝, municipalities are subject to two ceilings.

The first is the amount raised by a municipality shall not exceed 2.5 percent the assessed value of all property in it. The second is the annual increase.

For many of our towns in the Hampden, Franklin and Worcester District, the constraints of Prop 2˝ is making it impossible to meet the needs of our districts. Of the top 20 highest taxpaying municipalities in the commonwealth, seven are in the Hampden, Franklin and Worcester District. We're facing many challenges such as still no broadband in any communities. This will allow us to analyze the impact and grapple with the impacts.

Sen. Comerford requested a roll call vote. There was sufficient support.

Sen. Lesser said, I rise in support of this amendment. This is an urgent need. We have to examine our underly property tax system in the state.

One important way to illuminate this is to show a list of the communities in Massachusetts with the highest property tax rates, the top 50 towns. The highlighted ones come from Worcester, Franklin, Hampden, Hampshire or Berkshire counties. Almost all of the highest property tax towns are in Western Massachusetts.

In Western Mass., for a variety of reasons, we have economic growth that is not as robust as other parts of the state. Those forces combine to mean overall property values in our region are flat or going down, in some cases down precipitously. When property values are flat or falling you need to raise the rate just to keep up with inflation and incremental costs that every town faces.

As a result, some of our lowest-income communities have higher property tax rates than many of our wealthy communities. A lot of our towns are willing to step up and to tax themselves more to pay for these vital services but Proposition 2˝ puts a cap on that.

The real-life consequence is once the levy limit is reached, towns have no ability to raise revenue to pay for services. What happens is you hit the ceiling and cannot raise property taxes anymore and there are no more ways to collect additional revenue and yet other costs continue to rise. Those towns have to start laying people off and cutting services.

It's a ticking time bomb for our communities and is an urgent municipal finance problem facing our communities. The conversations around Chapter 70 shows how dependent on state aid cities and towns are.

The subject of broader municipal finance reform is part and parcel with a real conversation about education equities. I hope the amendment is adopted.

BY A ROLL CALL VOTE OF 34-4, the amendment was ADOPTED. Time was 6:24 p.m.


State House News Service
Monday, September 30, 2019

Last year's spending choices still unresolved on Hill
By Michael P. Norton

With the second quarter of the state's fiscal year set to open on Tuesday, the Massachusetts Legislature still has not closed out the books on the budget year that ended three months ago.

Massachusetts taxpayers delivered more than enough revenue to run state government in fiscal 2019, but legislators have yet to decide how to use the surplus.

Former Comptroller Thomas Shack for years tried to remind lawmakers of the importance of taking timely action on a so-called "closeout supp," but lawmakers in recent years have opted to wait longer and longer to pass that bill, taking it up in October or even November, rather than August or September as they used to do in the late 1990s and early 2000s.

The comptroller must close the books on the fiscal year that ends each June 30 and file the annual Statutory Basis Financial Report by Oct. 31. To adhere to that schedule and follow industry best practices, a final supplemental budget should be approved by Aug. 31 each year, Shack had argued.

"This is the fourth fiscal year that I've operated as the commonwealth's comptroller and this is the fourth year under my comptrollership that we will not meet the statutory deadline," Shack said last October. "I would reiterate that such late activity is really perilous. It's a well-known risk within the audit world that if you do not meet your own statutory obligations you may well subject yourself to really, really significant scrutiny."

Treasurer Deborah Goldberg last October echoed Shack's concerns, citing rating agency scrutiny and "not a real strict adherence to the deadlines, which are critical in terms of how the outside world looks at all of this, so sort of getting away with this, it's sort of like kids getting away with stuff for too long."

On Monday, new Comptroller Andrew Maylor took a less critical view of the situation, telling the News Service he'd like to see action on a closeout fiscal 2019 budget "the sooner the better."

"We're waiting patiently," he said. "We recognize that the Legislature has a lot to do. We continue to work with the Legislature and the governor's office."

A growing economy and conservative tax revenue estimates have left state government in Massachusetts swimming in excess revenue, helping budget writers to make a larger than usual contribution this year to K-12 education and to build the state's rainy day fund account up to more than $3 billion.

Gov. Charlie Baker filed his $648 million closeout budget on Sept. 6, recommending $100 million in new education investments and funding to address fentanyl trafficking, drinking water contaminants, and local roads and bridges.

Under the governor's bill (H 4067), the income tax exemption for dependents would also rise from $1,000 to $2,000, benefiting taxpayers who have children or care for dependent relatives who are elderly or have a disability.

The governor's bill poses a tax relief question for lawmakers who are planning a debate on tax and revenue increases to pay for transportation investments.

House Speaker Robert DeLeo and Senate President Karen Spilka have declined to stake out positions on the tax relief proposal.

The governor's appropriations bill is pending before the House Ways and Means Committee, chaired by Rep. Aaron Michlewitz. A committee spokesman said the panel continues to work on it and hopes to take it up "sometime in the near future."


State House News Service
Monday, September 30, 2019

Baker: State employee leave contributions "only fair"
By Chris Lisinski


With a new tax to fund the state's paid family and medical leave program set to take effect Tuesday, Gov. Charlie Baker rejected calls by the state's largest public union to relieve state employees of the obligation to pay into the system.

The National Association of Government Employees, which has more than 22,000 members in Massachusetts government, slammed the Baker administration this month for not covering employees' share of the new payroll tax as other public employers, including both the House and Senate, reportedly did.

Baker said Monday that he disagrees with their criticism and believes all state employees should contribute to the program.

"Our view is that state government, like everybody else, should comply with the law," Baker told reporters after a groundbreaking event in Quincy. "The law was basically the part of a bargain between advocates and labor unions and the Legislature, and I think it's important for state government to abide by the law that is going to apply to everybody else. I think that's only fair."

The $800 million program — outlined in the "grand bargain" law that Baker signed last summer to avert several ballot questions — will allow employees to take up to 12 weeks of paid leave to care for a new child, tend to an ill family member, or cope with a loved one's active military deployment. Workers can also take up to 20 weeks to recover from a serious illness or injury or to care for a service member who is ill or injured.

Benefits to care for a new child or sick service member or to manage a health issue become available on Jan. 1, 2021, while paid leave to care for ill family members will become available on July 1, 2021. Employees would be capped at receiving $850 per week in pay while on leave.

The job-protected benefits will be funded by a new 0.75 percent payroll tax that goes into effect Tuesday. Specific deductions will vary by employers, but they can require workers to contribute up to 40 percent of their total medical leave contribution and up to 100 percent of their total family leave contribution.

State officials say affected employees will see a maximum of 38 cents taken out of every $100 earned.

NAGE sparred with the Baker administration this month as it and other unions negotiated over what rates employees and public employers will pay.

In a Sept. 19 press release, the union said that Treasurer Deborah Goldberg, Auditor Suzanne Bump, House Speaker Robert DeLeo, Senate President Karen Spilka and county sheriffs had all agreed to use state resources to cover the entirety of their staffs' PFMLA assessment costs.

NAGE criticized the administration — which covers the entire executive branch and has far more employees — for not agreeing to similar terms.

"When you look at what the Constitutional officers, the Speaker, and the Senate President have decided to do versus what the Governor is doing, the difference is stark. Their actions speak volumes about them not only as leaders but even more importantly, as employers," NAGE National President David Holway said in the release. "Now they continue to walk the walk by setting an example for employers around the state. It's too bad that Governor Baker continues to be so consumed by the scandals in his administration that he has completely failed to do the right thing for his employees."


State House News Service
Tuesday, October 1, 2019

Fuel suppliers at heart of Transpo initiative
By Matt Murphy


The coalition of eastern states developing a program to drive down carbon emissions from transportation has decided to focus on motor gasoline and on-road diesel, two sources of pollution that account for over 80 percent of carbon emissions in the region.

The states are also eyeing a 10-year horizon for the program that will include a cap on emissions from both sources of motor fuel that begins in early 2022 and ratchets down every year through 2032, according to state energy officials and advocates.

The Transportation Climate Initiative, which is a multi-state coalition working to build a program to reduce carbon pollution from the transportation sector, released a draft framework of the program Tuesday.

The framework is the first in a series of steps that the coalition has mapped out in hopes of getting states to sign on to an agreement by spring 2020. An emissions cap is still being negotiated, making it too soon to estimate how much revenue the state will take in and how much more consumers could expect to pay at the pump.

Gov. Charlie Baker in late 2018 committed Massachusetts to the TCI along with 11 other states and the District of Columbia in an effort to tackle climate change throughout the region, not just Massachusetts.

Modeled on the Regional Greenhouse Gas Initiative that targeted emissions from power plants, TCI states are focused on developing a cap-and-invest program to drive down emissions from cars and trucks and facilitate the transition to a low-carbon transportation system.

The states currently involved are Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, and Virginia.

Energy and Environmental Affairs Secretary Kathleen Theoharides, who has been helping to lead the work of the 12 states, said the framework covers all fuel that's on the roads, but not jet fuel or boat fuel.

State fuel suppliers who transport fuel across state lines will be the entities to hold and trade emission allowances based on cap levels that still must be set. Theoharides said there are hundreds of these suppliers across the 13 TCI jurisdictions.

"Fuel suppliers would have to report their emissions and their compliance would be calculated based on how much emissions their fuel would produce when combusted," Theoharides said.

While states are still studying and negotiating where to set the emission cap, the secretary said the intention of the states is for the cap to decline every year. The proposed cap will be announced as part of a draft memorandum of understanding in December.

Where the cap is set and how fast it declines will signal how aggressive states want to be in reducing emissions and how much money will be generated from the sale of allowances for states to invest in low-carbon transportation options and how much more consumers will end up paying for gas.

The state chapter of the National Federation of Independent Business pointed to a study that found a similar cap-and-trade program in California targeting refinery emissions added 13 to 14 cents to a gallon of gas.

"Will (Massachusetts) suffer the same fate?" the group asked on Twitter.

Theoharides said that the difference between TCI and a gas tax is point of regulation and the market element of the program, which will allow carbon allowances to be auctioned and traded by suppliers.

The Baker administration has estimated that the sale of allowances could generate between $150 million to $500 million a year for Massachusetts.

"One of the two most significant remaining questions is what is that cap level and will it really be aligned with the climate crisis we're facing because we are running out of time to take significant action," said Jordan Stutt, carbon programs director at the Acadia Center. "We don't have any more time for baby steps."

Stutt said the framework moves the TCI states in a "very positive direction." "It's not easy to get such a broad group of states with unique transportation challenges and unique politics to agree," he said.

The coalition plans to seek feedback over the coming months on the framework as it finalizes a draft MOU to be released in December, which will also include more details on state-based programs to spend TCI funds.

There will be additional time for public input before a final MOU is produced by spring for states to sign, and states that need legislative approval to participate can pursue that as the formal rulemaking process begins.

The start date for the program would be early 2022.

Asked if the Legislature in Massachusetts would need to sign off on the state's final participation, Theoharides said the administration was still looking into it.

"We believe we have significant authority under the Global Warming Solutions Act," she said, referring to a 2008 state law.

The framework, according to Theohardies, also highlights a recognition among the states that equity and community engagement is vital to the success of the program, and states must invest in transportation options and other programming in communities that have been disproportionately impacted by poor air quality or lack of transit options.

"It's really important that this is a regional effort because the scale of climate change is bigger than any one state, but it's also important that TCI works for individual communities," Theroharides said.

Transportation for Massachusetts Director Chris Dempsey called the framework "an important milestone" in the process that keeps the state on track for an agreement that will deliver needed revenue for investments in clean, public transportation.

"We want to make sure this is a strong robust and equitable program," Dempsey said.

Environmental League of Massachusetts Vice President Nancy Goodman also said she was "heartened" by the draft framework, and would be looking for the states to set an aggressive emissions cap.

"This regional effort to price carbon has great promise for addressing emissions from transportation. Collectively, the states have been working hard to meet the year-end deadline to develop a program. This is a positive step along that path. We look forward to the next public announcement and urge the states to be bold to match the urgency of the climate crisis," Goodman said.

Associated Industries of Massachusetts, one of the state's largest business groups, also said it supports the regional approach "as outlined" as an effective way to reduce greenhous gas emissions.

"We intend to work with the administration on state-specific initiatives and investments that maximize potential benefits to the residents of Massachusetts while at the same time reducing greenhouse gases in the most cost-effective manner possible," said Bob Rio, AIM's senior vice president of government affairs.

In legislation filed by governor in July, Baker proposed to earmark half of the revenue Massachusetts receives through TCI for the MBTA.


State House News Service
Friday, October 4, 2019

Weekly Roundup - Adding Up
Recap and analysis of the week in state government
By Matt Murphy


Nobody said there would be math on the test.

But as senators prepared this week for a debate over $1.5 billion in new spending on public education, Gov. Charlie Baker thought it would be a good time to sprinkle a few numbers on the plate to season the discussion.

An analysis of the education funding reform bill, produced by the Department of Elementary and Secondary Education, looked like a fairly straight forward case of addition. Over the next seven years, the state's direct aid to cities and towns for schools would climb by over $2.1 billion, including inflation, to make up for years of underfunding.

The new formula would ensure that districts with larger populations of low-income students and English language learners would get a bigger share of the increase. But everyone would get at least a sliver of the pie, said Sen. Jason Lewis, the Education Committee co-chair.

Legislative leaders didn't see it that way.

The speaker, the Senate president and the authors of the bill all struck out at the governor, accusing him of deliberately releasing "misleading" data to muddy the waters the day before the Senate debate.

It's complicated, they said. The governor's numbers only paint part of the picture, they argued. You can't predict inflation or enrollment trends, they asserted.

The bottom line was that Democratic leadership preferred to explain the caveats to members behind closed doors rather allow a set of district funding figures that might be a little fluid to leave the public with the wrong impression. They didn't have better figures they were willing to share publicly, but they didn't like his.

Senate Minority Leader Bruce Tarr made a brief fuss on the floor over the fact that senators were being asked to vote on a bill - they ultimately all voted in favor - without a full set of district funding projections, but didn't use powers afforded to him under Senate rules to postpone the debate.

And so it moved on, to the unanimous vote in support of the biggest school funding overhaul since 1993....

The biggest beneficiaries from the bill, based on DESE's disputed analysis, would seem to include Brockton, Revere, Lynn, Everett and Lawrence - the five cities with the highest percent increase in state funding over the life of the bill. The smallest percentage growth in Chapter 70 aid goes to Clarksburg....

Climate activists would probably ban carbon if they could, but short of that 12 states and the District of Columbia put out a framework of a regional pact that would seek to drive down emissions from cars and trucks.

The states participating in the Transportation Climate Initiative said this week they would target motor gas and on-road diesel for a cap-and-trade program that would put a price on carbon in the transportation sector.

Fuel suppliers would be the ones buying and selling carbon allowances, but some business groups warned that it will still be drivers paying the price at the pump.

Vehicles account for over 80 percent of carbon pollution in the region, according to the coalition, making the transportation sector integral to the climate change fight. It remains to be seen, however, where the states will set their emission cap and how quickly they'll drive it down over the 10-year life of the program.

Energy Secretary Kathleen Theoharides has been playing a key role in wrangling the states, and she said details on the cap will be included in a draft memorandum of understanding to be released in December.

The ultimate goal of the TCI coalition is to have a final MOU ready for states to sign by the spring, and for the program to begin in 2022.


State House News Service
Friday, October 4, 2019

Advances - Week of Oct. 6, 2019


The Legislature has 18 months every two years to hold formal sessions and take action on major bills. By Tuesday, the midway point in that 18-month journey, Massachusetts lawmakers had little to show in terms of major accomplishments, beyond laws helping public sector unions recover costs, enabling benefits to flow to families that have more children while receiving public assistance, and banning conversion therapy for minors.

The slow start is par for the course for the Legislature, which can't seem to break, or isn't interested in breaking, its habit of leaving its most important business to the final days and even minutes of formal sessions every other year. But there are signs of autumnal activity on Beacon Hill beyond the hundreds of obligatory public hearings that legislative committees are holding on the thousands of bills that are filed and ultimately quietly die each session, even though neither the House nor Senate have formal sessions scheduled next week.

The Senate on Thursday night left the House a freshly approved bill committing the state to appropriating $1.5 billion in new revenues toward the K-12 public education system over the next seven years. The bill was pre-negotiated with House leaders, and the House plans to approve its version sometime before mid-November. It's unclear whether House and Senate Democrats will try to get a bill to Gov. Charlie Baker by Thanksgiving.

The alternative - getting a bill into a House-Senate conference committee by the holiday break - could again push the whole education debate behind closed doors and postpone final action on the bill, which has really been in development for years, into the 2020 election year. The Senate is also waiting for the House to get the ball rolling on a bill allocating the sizeable fiscal 2019 budget surplus, and everyone's waiting for the House to unveil and debate a bill identifying new revenue sources for transportation.

The House has also been quietly stacking up its priorities on the doorstep of Senate President Karen Spilka. In July, the House sent the Senate a proposal (H 3997) to spend more than $1 billion over the next ten years helping communities adapt to climate change and making resiliency-minded energy grid improvements, as well as a children's health care bill (H 4012). Since coming back from summer break, the House last week approved a bill (H 4087) overhauling campaign finance reporting and the method used to choose the director of the Office of Campaign and Political Finance. This week, the House sent the Senate legislation (H 4099) requiring higher education institutions to comply with a new regulatory regime in order to safeguard students and families in an era of campus consolidation that's being forced by a shrinking of the college-age population and other factors.

Going the other way, the Senate is awaiting House action on bills banning child marriage (S 2294), prohibiting flame retardants in certain consumer products (S 2338), and creating a non-binary "gender X" designation available on state identifications (S 2213).

The week ahead also brings some important public hearings, including gatherings to vet Gov. Baker's $18 billion transportation bond bill, a proposal to make people serving life sentences for murder eligible for parole consideration, and altering the landscape for charter schools.

For reasons unknown, House Speaker Robert DeLeo is more optimistic than he was a week ago about the closed-door conference committee work on a stalled distracted-driving bill, though it's still anyone's guess when and if legislative Democrats will reach an agreement on that bill.

 

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