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“Every Tax is a Pay Cut ... A Tax Cut is a Pay Raise”
46 years as “The Voice of Massachusetts Taxpayers”
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CLT UPDATE
Monday, October 19, 2020
Baker's $900M Budget
Increase
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to CLT's Commentary on the News
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Most Relevant News Excerpts
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Commentary)
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Sooner or later
California’s public unions had to hit up the hoi polloi to
pay for their pensions after soaking what’s left of the
state’s millionaire class, and here they come.
On Nov. 3,
Californians will vote on a “split roll” ballot
initiative (Prop. 15) that seeks to enact the biggest
tax hike in state history. In 1978 voters enshrined
protections against runaway property taxes in the state
Constitution (Prop 13). Prop. 15 would abolish those
protections for businesses while maintaining
limitations—at least for now—on homes....
California’s
home prices have increased ninefold since 1978, and
commercial real estate has also appreciated enormously,
especially in coastal areas. Unions say their initiative
will only hit wealthy corporations, but not even the
Democratic-friendly NAACP believes that whopper, which
is why it and minority business groups are campaigning
against the initiative. Anyone who owns a couple of fast
food franchises would get walloped. Ditto small dairies,
wineries, orchards and manufacturers, though Democrats
in the Legislature have charitably proposed to exempt
solar farms.
Small
businesses that rent space note that landlords would
pass on the tax hike in lease agreements. Less affected
will be tech titans that recently purchased properties
or are planning to down-size office space as they allow
more employees to work remotely. Facebook CEO Mark
Zuckerberg is Prop. 15’s second biggest donor.
Perhaps he’s
trying to atone for his wealth, but as the NAACP and
minority business groups explained in a letter to him in
August: “Unlike Facebook, restaurants, dry cleaners,
nail salons and other small businesses can’t operate
right now and many may never open again. The last thing
they need is a billionaire pushing higher taxes on them
under the false flag of social justice.” ...
The state
Legislative Analyst’s Office forecasts Prop. 15 would
raise property taxes by $8.5 billion to $12.5 billion a
year by 2025, which is about twice as much as the
state’s 2012 tax hike on high earners. Unlike that
referendum, Prop. 15 revenues would supposedly go
directly to schools and local governments, which have
been struggling amid swelling pension payments.
Since 2013,
pension costs have grown 130% for teachers and doubled
for other local public employees. Rising retirement
costs are limiting wage increases at the bargaining
table, and Prop. 15 is the union answer to keep the cash
flowing. United Teachers Los Angeles says passing Prop.
15 “is key to winning the aggressive, comprehensive
demands we will bring forward in 2022”—and as long into
the future as their political dominance allows.
The Wall
Street Journal
Thursday, October 14, 2020
Opinion | Review & Outlook
California’s Next Big Tax Gulp
A ballot measure would repeal the business half of
legendary Prop. 13
Despite the
pandemic-related recession and high unemployment rates,
and an expected drop in state tax revenues, Gov. Charlie
Baker on Wednesday released a budget proposal for the
current fiscal year that is actually higher than the
budget he proposed in January.
Baker, a
Republican, is recommending a fiscal 2021 budget of
$45.5 billion, or 3.8 percent more than was spent in
fiscal 2020. The budget he released in January would
have spent $44.6 billion, or 2.3 percent more than in
the prior fiscal year.
The high
budget is largely driven by excessive spending in
MassHealth, the state’s Medicaid program. It would be
paid for with an influx of federal money as well as a
$1.3 billion draw from the state’s $3.5 billion rainy
day fund.
“The rainy day
fund is there to support services when it’s raining, and
I think most people would agree it’s raining,” Baker
said at a State House press conference....
Baker said he
expects to submit another temporary budget to keep
government running through November, and he hopes
lawmakers can return a budget bill to his desk by
Thanksgiving. With the process likely to go past the
election, that means state lawmakers will be voting on
the budget in an unusual lame duck session.
Baker does not
plan to raise taxes and would allow the income tax rate
to drop to 5 percent, the final drop approved two
decades ago in a 2000 ballot question.
“The idea of
going back to taxpayers given their own situation just
didn’t seem like the right thing to do,” Baker said.
Baker does
want to delay implementing a state charitable deduction,
which was scheduled to go into effect this year and
would have cost the state $64 million in tax revenue.
Baker is also proposing “modernizing” the collection of
sales taxes by requiring large businesses to remit sales
taxes to the state more quickly. This is estimated to
bring in $267 million in one-time revenue, primarily by
collecting in this fiscal year money that would
otherwise have come in next year. It is a proposal he
has made before, which has never been approved by the
Legislature.
CommonWealth
Magazine
Wednesday, October 14, 2020
Despite pandemic, Baker proposes higher spending
Total expenditures more than what he proposed pre-COVID
in January
One of the
state's largest and most influential business groups
urged Beacon Hill lawmakers on Tuesday to take tax
increases off the table as they consider how to put
together a state budget that accounts for major declines
in revenue, but doesn't dismantle critical state
services.
Associated
Industries of Massachusetts, in a message posted to its
website, suggested that it would be more appropriate at
this moment to dip into the state's $3.5 billion reserve
fund, or even utilize low-interest borrowing to keep
programs running and employees on the payroll as they
wait for Congress to provide states with financial
relief.
"Tax increases
now would further destabilize businesses, many of which
are already on the edge of collapse," AIM President John
Regan was quoted saying in the blog post....
AIM's position
on taxes echoed that of the Massachusetts High
Technology Council, which last week warned that if
policy leaders turn quickly to tax increase to stabilize
state finances it would send the wrong message to
employers. But unlike AIM, the High Tech Council said it
could eventually support temporary tax hikes as part of
a multi-faceted strategy to get through the recession.
[See excerpt below: SHNS - Oct 7]
State House
News Service
Tuesday October 13, 2020
Tax Hikes Could Push Biz Out of State, AIM Says
Remote Work Seen Loosening Ties Between Companies,
Employees
. . . [Michael
Goodman from UMass Dartmouth's Department of Public
Policy] suggested the idea of temporary tax hikes to
maintain state programs that help people through the
pandemic. That notion might have more support than
others. The business-backed Massachusetts High
Technology Council has long resisted efforts to impose
new or higher taxes at the state level, but it
acknowledged as recently as Wednesday morning that it is
not entirely opposed to tax increases.
"Temporary
revenue raising options may be necessary and could
attract significant support from business leaders --
including the High Tech Council -- provided they are
coupled with a combination of prudent and
forward-looking approaches that optimize 'rainy day
fund' resources, budget reductions, public procurement
reforms, state borrowing and federal aid," Christopher
Anderson wrote in his August bulletin. The same language
was repeated in a memo sent to state legislators
Wednesday morning. . . .
State House
News Service
Wednesday, October 7, 2020
[Excerpt]
Budget Managers Still Sizing Up Depth of Problems
Big Tax Slide Envisioned Under Even Optimistic Scenarios
By Colin A. Young
Gov. Charlie
Baker said Wednesday he understands why lawmakers are
taking a long time to negotiate the bills currently
pending in conference committees, covering topics from
police reform to economic development to health care to
transportation.
“They all
passed bills that were conceptually consistent with each
other but had a heck of a lot of details in each of them
that were different,” Baker said. While he would “love
to see many enacted sooner,” the governor said he
respects the “difficult conversations.”
But that
doesn’t mean Baker plans to wait for those bills to get
his policy priorities passed. Instead, he’s pinning his
hopes on the state budget.
When Baker
announced his revised fiscal 2021 budget proposal
Wednesday, he included 118 “outside sections,” policy
proposals inserted into the budget.
CommonWealth
Magazine
Thursday, October 15, 2020
Baker budget packed with policy proposals
A reimagined
$45.5 billion spending plan that relies heavily on the
state’s rainy-day fund to balance the state budget in an
era of freefalling tax revenues could be setting the
state finances up for a “challenging” fiscal storm in
the future, budget watchdogs warned.
To help make
up for a gaping $3.6 billion shortfall in anticipated
tax revenues spurred by widespread business shutdowns
amid the pandemic, Gov. Charlie Baker’s proposed budget
would drain $1.35 billion from the state’s rainy-day
fund — a move he says is necessary to avoid cuts in
services and layoffs.
“This budget
plan reflects the new realities associated with
COVID-19, but it continues to make significant
investments in education and economic development and it
does not raise taxes,” Baker said, speaking at the State
House on Wednesday.
Baker’s plan
actually represents a 3.8% — nearly $1 billion — funding
boost over his initial January budget....
With
anticipated tax revenues coming in $3.6 billion under
early-year predictions, Baker’s plan would balance the
budget by drawing on $1.35 billion in rainy-day funds,
roughly $830 million in federal Medicaid reimbursements,
$550 million in federal coronavirus aid, and using $422
million that rolled over from last year’s budget.
The governor
said his plan allows “significant investments” while
avoiding any broad-based tax increases, layoffs, or cuts
to social and health safety net programs, and
level-funds local aid, consistent with an agreement
announced with the Legislature in July.
But budget
watchdogs disagree.
Eileen
McAnneny of the centrist Massachusetts Taxpayers
Foundation warned of “challenging” times to come in the
next fiscal year. The “vast majority” of one-time
funding the governor relies on to balance this year’s
budget is “not replicable,” she said.
“The state
will have to hope for further federal assistance, an
economic rebound and strong tax revenue growth because
the $2.2 billion remaining in the Stabilization or Rainy
Day Fund is not sufficient to weather this storm,” she
said.
The plan still
needs the sign-off from lawmakers, and legislative
leaders on Wednesday shed little light on what’s sure to
be agonizing and abbreviated deliberations.
The Boston
Herald
Thursday, October 15, 2020
Budget watchdog warns reliance on coronavirus rainy day
fund
to balance $45.5B budget could set Massachusetts up for
fiscal storm
Despite
falling state tax revenues and a budget that has been
redrawn to reflect the havoc of a pandemic, the Baker
administration confirmed Wednesday that Massachusetts
will stick to the aggressive plan to chip away at the
state's pension liabilities.
The
Legislature and administration agreed before the
pandemic to hike the state's annual pension payment by
more than 9.6 percent each year -- and by more than 30
percent over the three-year period -- as it works to
stash away money to cover the $41 billion unfunded
portion of the expected pension liability of more than
$96 billion....
The
Massachusetts Taxpayers Foundation on Wednesday cited
the Baker administration's decision to honor the pension
funding schedule it previously agreed to as one example
of why the Baker revised budget "is not as austere as
some would have anticipated."
State House
News Service
Thursday, October 15, 2020
Baker Budget Retains Nearly 10 Percent Pension Funding
Hike
House and
Senate leaders on Beacon Hill chose not to intervene
Thursday to block the expiration this weekend of the
state's moratorium on evictions and foreclosures,
despite the efforts of one Democrat to force an
emergency extension of the ban through the end of the
year.
Gov. Charlie
Baker on Monday put forward an eviction diversion plan
that allows the moratorium to expire on Saturday, but
also pumps $171 million into rental assistance and other
measures to try to keep people facing economic hardship
from the COVID-19 pandemic in their homes.
Baker said his
approach was preferable to allowing renters and
homeowners to fall deeper into debt, but many advocates
and lawmakers said the initiative was insufficient to
meet the need and prevent a housing crisis at a time
when coronavirus infection rates are rising.
Rep. Michael
Connolly, a Cambridge Democrat, showed up during a
lightly attended informal session of the House on
Thursday to file an emergency petition that would extend
the moratorium until Jan. 1, 2021....
The House
admitted Connolly's petition and referred it to the
Joint Committee on Housing, but further action required
concurrence from the Senate, which had already adjourned
for the day....
Connolly said
that despite voting in July to extend the legislative
session until the end of the year lawmakers have "ceded
our responsibility for policy making in this critical
moment of pandemic and economic meltdown" to the
governor.
"When you
think about the concerns of our constituents, the
challenges facing the commonwealth, I would like us to
actually utilize the abilities we have to make policy
and pass legislation," Connolly said.
State House
News Service
Thursday, October 15, 2020
Legislature Leaves Eviction Crisis to Baker, Courts
Opts Against Intervening With Moratorium About to End
The House and
Senate Ways and Means committees will hold a virtual
hearing featuring invited testimony next week on Gov.
Charlie Baker's revised $45.5 billion budget, which the
Republican filed on Wednesday and said he hopes to see
completed and returned to him before Thanksgiving.
Rep. Aaron
Michlewitz and Sen. Michael Rodrigues will host the noon
hearing next Wednesday from the State House, and said
they look forward to hearing from "members of the
Administration, our colleagues, and the general public."
The committee
chairs did not release a list of who will be invited to
speak, but said guests will participate remotely via
video or audio conference.
State House
News Service
Thursday, October 15, 2020
Invite-Only Hearing on Baker Budget Set for Wednesday
It's easier to
understand now why Gov. Charlie Baker didn't want to
cancel Halloween. He had his costume all picked out. And
no he's not dressing as Donald Trump.
Whether by
sleight of hand or happenstance, Baker, the budgetary
magician, managed to take a lot of the sting this week
out of an exercise in fiscal obligation that legislators
had been wringing their hands over for months, spooked
by the pain it would inflict.
The longer
Washington took to fight over the next stimulus package,
the longer Beacon Hill could put off its inevitable need
to pass a balanced budget for the year. Even, and maybe
most importantly, if that meant waiting until after the
election.
That
can-kicking stopped Wednesday.
Baker waved
his wand and updated the state's revenue forecast to
reflect a $3.6 billion drop in tax collections compared
to what had been projected back in January. It was
better than the $5 billion to $8 billion once feared,
but it wasn't couch change either. Then for his next
act, Baker submitted a revised state budget to the
Legislature that actually increased proposed spending by
about $900 million from his January plan, tipping the
scales at $45.5 billion for the year.
"Pretty neat
trick, huh?" Baker said, smiling wryly at a question
about how he accomplished that feat....
The governor's
budget did not raise any new broad-based taxes and
incorporated the final, mandated drop in the income tax
to 5 percent in January, but he also delayed a
charitable giving tax deduction and reproposed an
accelerated method for collecting sales taxes that would
net the state $267 million in one-time revenue, but has
been rejected as unworkable by the Legislature more than
once....
Needless to
say, Baker's updated budget recommendation was just the
start of the process, and one the governor
optimistically said he'd like to see wrapped up by
Thanksgiving.
While that may
take another act of magic to accomplish, Senate Ways and
Means Chairman Michael Rodrigues called it a
"responsible" plan that gives the Legislature a "good
foundation" to build their own budgets - even if that
foundation is built on one-time money....
Prepared to
let the moratorium on evictions and foreclosures expire
on Saturday, the administration released a plan Monday
that it developed with Trial Court Chief Justice Paula
Carey to try to stem the rising tide of eviction
proceedings by increasing rental assistance by $100
million and bolstering landlord-tenant mediation and
other supports....
Rep. Mike
Connolly of Cambridge even tried Thursday to force
passage of an emergency petition to extend the
moratorium until January, but the furthest he got was
getting the bill admitted to the House....
"When you
think about the concerns of our constituents, the
challenges facing the commonwealth, I would like us to
actually utilize the abilities we have to make policy
and pass legislation," Connolly said, expressing his
frustration that neither the House nor the Senate has
met in a formal session since July 31, despite voting to
extend formal sessions beyond that date in part to deal
with pandemic-related issues....
Baker won't be
voting for Trump, which the governor confirmed this week
to the surprise of no one.
Baker,
however, did not endorse Joe Biden and suggested he
might not vote at all.
State House
News Service
Friday, October 16, 2020
Weekly Roundup - Neat, But Not Tidy
The historic
turnaround time for an annual budget will only be
accomplished with a rare level of harmony between House
and Senate Democrats on Beacon Hill, whose intraparty
troubles agreeing on major priorities this year are on
par with the more common partisan divisions that are the
primary obsessions of media and election year
activity....
With an annual
budget already well more than three months overdue,
lawmakers this week quickly scheduled a hearing on
Baker's massive plan for next Wednesday at noon. But
with the elections coming up in just over two weeks,
Beacon Hill's unspoken plan to push all of its remaining
controversial and complex work off, including the
budget, until after the elections is appearing more
likely by the day.
State House
News Service
Friday, October 16, 2020
Advances - Week of Oct. 18, 2020
New Hampshire
Gov. Chris Sununu plans to take Massachusetts to court
over the Bay State’s policy taxing the income of
out-of-state residents telecommuting for Bay State
companies amid the pandemic.
Sununu
announced plans Friday to sue the Baker administration
in the U.S. Supreme Court over the policy he called a
“direct attack” on New Hampshire.
“The
Commonwealth has launched a direct attack on the New
Hampshire Advantage, attempting to pick the pockets of
our citizens,” Sununu said in a statement. “We are going
to fight this unconstitutional attempt to tax our
citizens every step of the way, and we are going to
win.”
The latest
salvo in the ongoing income-tax border battle comes as
the Massachusetts Department of Revenue on Friday
finalized a temporary rule that imposes the state’s 5%
income tax on employees of Massachusetts companies
living and working remotely in other states as the
public health crisis wears on.
“Within five
minutes of learning of this rule change, I immediately
directed the Department of Justice to file a lawsuit in
the United States Supreme Court on Monday,” Sununu
said....
Paul Craney of
the Massachusetts Fiscal Alliance said in a statement
Friday that the policy was “especially cruel” for
residents of New Hampshire, where there is no state
income tax, and warned it might prompt companies to
leave Massachusetts.
“These workers
are no longer using our state’s resources to do their
jobs,” Craney said. “Taxing them at this point is a
blind money grab with no fee for use aspect.”
The Boston
Herald
Friday, October 16, 2020
Gov. Chris Sununu plans to sue Massachusetts over policy
taxing N.H. telecommuters
Sununu: Tax on remote workers a ‘direct attack’ on N.H.
Joe Biden
ought to be like Charlie Baker when it comes to packing
the court.
Because there
is a difference between “packing” and “stacking.”
Biden wants to
pack U.S. Supreme Court. Baker wants to stack the
Massachusetts Supreme Judicial Court.
In only a
matter of weeks, Baker, the RINO (Republican in name
only) governor of Massachusetts, will have named all
seven members of the Massachusetts Supreme Judicial
Court and, unlike in Washington, no one is complaining.
One reason for
the lack of critical commentary is that Baker’s
appointees to the high court reflect Baker’s liberal
views. Massachusetts is an overwhelmingly liberal,
Democratic state that has grown increasingly
progressive, as has Baker. He is the type of Republican
that Democrats love.
Another reason
is that Baker is not really “packing” his high court by
increasing the number of justices, the way the Democrats
want to do to the nine-member Supreme Court in
Washington.
Instead of
“packing,” Baker is “stacking.” You might even say he is
“stocking,” as in stocking the shelves of the court with
liberals who are just like him....
The Boston
Herald
Saturday, October 17, 2020
Charlie Baker packs the SJC with his picks – and no
pushback
By Peter Lucas
Massachusetts
officials warned Wednesday that a Supreme Court decision
allowing the Trump administration to halt the census
count early could result in a botched final tally, even
as federal officials asserted that the vast majority of
households in the state had already been counted.
The
disagreement underscored the high stakes of the most
logistically challenging and politically contentious
count in recent memory. The census is used to calculate
federal funding and determine congressional seats; for
Massachusetts, roughly $16 billion is on the line....
The Census
Bureau has said that while only 69 percent of households
in the state “self-reported” online, by phone or mail,
census employees successfully counted the rest by going
door to door, achieving a 99.9 percent completion rate.
But local officials and census experts believe that
number is far too optimistic because, they say, federal
officials are purposefully painting a too rosy picture
and because in-person counting is much less reliable
than self-responses.
“It’s
fictional to talk about 99.9 percent,” said Secretary of
State William F. Galvin, the state’s official liaison to
the 2020 Census, who has been involved in two previous
counts. “The whole concept of short-circuiting this
thing and ending it early when it’s had so many problems
is so transparently deceitful.” ...
Galvin said
census officials have declined to provide
municipal-level data to the state about where people had
responded and where the gaps were. This makes it
impossible to determine where more outreach is
necessary, or even how many of the 30 percent of people
who did not self-respond were legitimately counted by
census officials, he said.
Galvin is also
skeptical of the high number touted by the Census Bureau
because his office has been working to address some of
the challenges to in-person counting — like getting
access to apartment buildings — even as federal
officials said the counting was finished....
Federal census
officials disputed that notion. Jeff T. Behler, regional
director of the census, said that it was too labor
intensive to provide municipal-level data to the state
but that he was confident the count had been
comprehensive.
“We have
knocked on every address. We have gotten a response from
nearly all of the addresses in the Commonwealth of
Massachusetts,” Behler said in an interview.
In the absence
of specific data, state officials and advocates fear
tallies will be low in such historically hard-to-count
communities as Lawrence and Chelsea, which have high
populations of renters, immigrants, and college
students. The same cities have been hardest hit by the
coronavirus and rely the most on federal aid distributed
using census data.
“We are very
concerned,” said Eva Millona, executive director of the
Massachusetts Immigrant and Refugee Advocacy Coalition
and chairwoman of the state’s 2020 Complete Count
Committee. “It’s about resources. It’s about political
power.”...
Galvin said
the Census Bureau told him that door knocking will end
at 11 p.m. on Thursday, while self-responses will end
early Friday. The state had planned census outreach at
early voting sites this weekend, Galvin said, but was
required to cancel those events.
“Any day,
they’ll have a balloon drop to say they’re finished,” he
said. “Even though we know we’re not.”
The Boston
Globe
Wednesday, October 14, 2020
‘So transparently deceitful.’ Ending census early
will leave parts of Boston uncounted, possibly resulting
in less aid
With voting
set to end in Massachusetts in 22 days, three prominent
state Republicans announced on Tuesday that they had
formed a political action committee to support GOP
candidates for state, local and county offices.
Republican
National Committee Treasurer Ron Kaufman and Janet
Fogarty, the state's other RNC member, said that every
dollar donated to The Fund for Massachusetts Future PAC,
outside of small administrative expenses, would go to
supporting local candidates.
The focus,
they said, could potentially open the door to donors who
might want to support local Republicans, but don't want
to contribute to federal candidates in a cycle when
attitudes toward President Donald Trump and Congress are
a motivating factor.
"Everyone
talks about how critical of an election this is. Our
candidates on the ground deserve support, and we needed
to develop a giving strategy that keeps all dollars here
in Massachusetts. It's what's best for donors and what's
best for candidates," Kaufman said.
The paperwork
for the PAC was filed with the Office of Campaign and
Political Finance on Oct. 1, and lists the promotion of
"fiscal conservatism and job growth in the commonwealth"
as its objective. The committee will be chaired by
Michael Sullivan, a former state lawmaker and U.S.
Attorney who has also run for U.S. Senate....
Sullivan
compared the Legislature on Beacon Hill, where Democrats
control 164 of 200 seats in the House and Senate, to a
monopoly, which he said is not good for business or
public policy.
"Successful
campaigns need great candidates, grassroots, and
financial support," Sullivan said. "The narrative needs
to be kept on why our Republican candidates for state
and local offices are better for the taxpayers, better
for public policies, better for education, and better
for attracting and retaining good jobs and businesses."
...
Not counting
candidates for federal office, there are 66 Republicans
on the ballot this fall, with just 19 challenging
Democratic incumbents in the Legislature and almost as
many defending their seats from challenges from
Democrats.
The state
party's fundraising has also lagged in the midst in the
pandemic, and without any real support from the de-facto
leader of the party Gov. Charlie Baker. As the party has
moved toward Trump under the stewardship of MassGOP
Chair Jim Lyons, Baker has moved away from the president
and national politics, despite his endorsement of U.S.
Sen. Susan Collins in Maine.
Baker has said
that outside of that endorsements he and Lt. Gov. Karyn
Polito intended to keep their politicking confined to
campaigning for some legislative candidates, though that
has yet to really happen....
A separate
super PAC run by allies of Gov. Baker - Massachusetts
Majority super PAC - has spent nearly $230,000 in 2020
to support local and state candidates, including
Democrats and Republicans.
State House
News Service
Tuesday, October 13, 2020
GOP Leaders Form PAC in Election Stretch Run
Kaufman: Strategy Creates New Outlet to Help GOP
Candidates |
Chip Ford's CLT
Commentary
I just did a remote
Zoom interview with Mary Saladna of WCVB TV-5 for my take on New
Hampshire Gov. Sununu's lawsuit against Massachusetts. (See
The Boston Herald report below:
"Gov. Chris Sununu plans to sue Massachusetts over policy
taxing N.H. telecommuters") You might catch it on the news
this evening. (Read more about it below.)
As we prepare to celebrate 40 years of Proposition
2˝
in just two weeks (passed overwhelmingly by voters on
the 1980 ballot) it's important to recognize that it was
inspired by California's Proposition 13, also passed
overwhelmingly by the Golden State's voters —two years
prior to Prop
2˝
in 1978.
The property tax limitation movement spearheaded by
Howard Jarvis (photo left) was launched in California,
moved next to Massachusetts, then spread around the
country to one degree and form or another.
In recognition of her success leading our own property
and other tax limitations in Massachusetts, during the
National Taxpayers Union's 1999 annual convention in
Washington D.C. Barbara Anderson
was
awarded The Howard Jarvis Taxpayers Association's
National "Lifetime Taxfighter Award" (photo beneath —
click on it to enlarge). It was the fifth such
recognition by the California taxpayers association. The
first bronze Howard Jarvis bust was awarded to Ronald
Reagan.
As you know, our Proposition
2˝
is yet again
under assault — its fate still pending in the
Transportation Bond Conference Committee. But what is
happening in California may again be a precursor of what
will come to Massachusetts soon. The Wall Street Journal
editorialized on Thursday ("California’s Next Big Tax
Gulp — A ballot measure would repeal the business half
of legendary Prop. 13"):
Sooner or later California’s public
unions had to hit up the hoi polloi to pay for their
pensions after soaking what’s left of the state’s
millionaire class, and here they come.
On Nov. 3, Californians will vote on a “split roll” ballot
initiative (Prop. 15) that seeks to enact the biggest tax hike
in state history. In 1978 voters enshrined protections against
runaway property taxes in the state Constitution (Prop 13).
Prop. 15 would abolish those protections for businesses while
maintaining limitations—at least for now—on homes....
California’s home prices have increased ninefold since 1978, and
commercial real estate has also appreciated enormously,
especially in coastal areas. Unions say their initiative will
only hit wealthy corporations, but not even the
Democratic-friendly NAACP believes that whopper, which is why it
and minority business groups are campaigning against the
initiative. Anyone who owns a couple of fast food franchises
would get walloped. Ditto small dairies, wineries, orchards and
manufacturers, though Democrats in the Legislature have
charitably proposed to exempt solar farms.
Small businesses that rent space note that landlords would pass
on the tax hike in lease agreements. Less affected will be tech
titans that recently purchased properties or are planning to
down-size office space as they allow more employees to work
remotely. Facebook CEO Mark Zuckerberg is Prop. 15’s second
biggest donor....
Perhaps he’s trying to atone for his wealth, but as the NAACP
and minority business groups explained in a letter to him in
August: “Unlike Facebook, restaurants, dry cleaners, nail salons
and other small businesses can’t operate right now and many may
never open again. The last thing they need is a billionaire
pushing higher taxes on them under the false flag of social
justice.” ...
The state Legislative Analyst’s Office forecasts Prop. 15 would
raise property taxes by $8.5 billion to $12.5 billion a year by
2025, which is about twice as much as the state’s 2012 tax hike
on high earners. Unlike that referendum, Prop. 15 revenues would
supposedly go directly to schools and local governments, which
have been struggling amid swelling pension payments.
Since 2013, pension costs have grown 130% for teachers and
doubled for other local public employees. Rising retirement
costs are limiting wage increases at the bargaining table, and
Prop. 15 is the union answer to keep the cash flowing. United
Teachers Los Angeles says passing Prop. 15 “is key to winning
the aggressive, comprehensive demands we will bring forward in
2022”—and as long into the future as their political dominance
allows....
The left-wing
Takers — both in California and Massachusetts, and everywhere
else — detest statutory and constitutional tax limitations on
their insatiable lusts, especially taxes on
other
people's property and income. For decades they've strived
to crack and ultimately shatter tax limitations. In
Massachusetts, decades of trying to crack the Commonwealth's flat
income tax, replace it with a "progressive" graduated income tax, is
another example. Their current, sixth attempt is called their
"Fair Share Amendment," aka their "Millionaires Tax" — "just on the
wealthy" they claim. For a start, or as the Wall Street
Journal put it, "at least for now."
Last Wednesday CommonWealth
Magazine noted:
Although
legislative leaders had at one point floated the idea of having
a joint budget between the governor, House and Senate, Baker’s
decision to release his own budget proposal indicates that this
will not happen. His proposal now goes to the House.
On Thursday it
added:
Gov. Charlie Baker said
Wednesday he understands why lawmakers are taking a
long time to negotiate the bills currently pending
in conference committees, covering topics from
police reform to economic development to health care
to transportation.
“They all passed bills that
were conceptually consistent with each other but had
a heck of a lot of details in each of them that were
different,” Baker said. While he would “love to see
many enacted sooner,” the governor said he respects
the “difficult conversations.”
But that doesn’t mean Baker
plans to wait for those bills to get his policy
priorities passed. Instead, he’s pinning his hopes
on the state budget.
When Baker announced his
revised fiscal 2021 budget proposal Wednesday, he
included 118 “outside sections,” policy proposals
inserted into the budget.
The State House News
Service reported on Thursday:
House and Senate
leaders on Beacon Hill chose not to intervene Thursday to block
the expiration this weekend of the state's moratorium on
evictions and foreclosures, despite the efforts of one Democrat
to force an emergency extension of the ban through the end of
the year.
On Friday in its Advances, the News
Service added:
Gov. Charlie Baker
on Monday put forward an eviction diversion plan that allows the
moratorium to expire on Saturday, but also pumps $171 million
into rental assistance and other measures to try to keep people
facing economic hardship from the COVID-19 pandemic in their
homes.
It its Weekly Roundup it noted:
With an annual
budget already well more than three months overdue, lawmakers
this week quickly scheduled a hearing on Baker's massive plan
for next Wednesday at noon. But with the elections coming up in
just over two weeks, Beacon Hill's unspoken plan to push all of
its remaining controversial and complex work off, including the
budget, until after the elections is appearing more likely by
the day.
Whether by sleight of hand or happenstance, Baker, the budgetary
magician, managed to take a lot of the sting this week out of an
exercise in fiscal obligation that legislators had been wringing
their hands over for months, spooked by the pain it would
inflict.
The longer Washington took to fight over the next stimulus
package, the longer Beacon Hill could put off its inevitable
need to pass a balanced budget for the year. Even, and maybe
most importantly, if that meant waiting until after the
election.
That can-kicking stopped Wednesday.
Baker waved his wand and updated the state's revenue forecast to
reflect a $3.6 billion drop in tax collections compared to what
had been projected back in January. It was better than the $5
billion to $8 billion once feared, but it wasn't couch change
either. Then for his next act, Baker submitted a revised state
budget to the Legislature that actually increased proposed
spending by about $900 million from his January plan, tipping
the scales at $45.5 billion for the year.
"Pretty neat trick, huh?" Baker said, smiling wryly at a
question about how he accomplished that feat.
I appears that the
Legislature is making itself less and less relevant by the day.
Gov. Baker has taken the reins as the unilateral power on Beacon
Hill — and I suppose who can blame him
if nobody else wants to get anything constructive accomplished.
Remember back in late July, when the Legislature decided it was
necessary to overturn its own longstanding rule and extend its
session until the next elected Legislature is seated in January?
On August 16
I predicted that the Legislature would be in re-election
hibernation until at least after the November election:
There's nothing
like a deadline to focus attention, and there's nothing like
extending a deadline to feed procrastination. Remember a month
ago when everything on Beacon Hill was about getting so much
accomplished before the July 31 recess deadline? Now that
they've agreed to ignore their own rule and remain in session
interminably the pressure is off the pols; it's back to
business-as-usual. Nothing has come out of any of the numerous
conference committees, and nothing likely will until the next
deadline, after they are safely re-elected.
The Massachusetts Great
and General Court remains "The Best Legislature Money Can Buy."
Baker waved his wand and updated the state's revenue forecast to
reflect a $3.6 billion drop in tax collections compared to what
had been projected back in January. It was better than the $5
billion to $8 billion once feared, but it wasn't couch change
either. Then for his next act, Baker submitted a revised state
budget to the Legislature that actually increased proposed
spending by about $900 million from his January plan, tipping
the scales at $45.5 billion for the year.
"Pretty neat trick, huh?" Baker said, smiling wryly at a
question about how he accomplished that feat.
CommonWealth Magazine reported on
Wednesday ("Despite pandemic, Baker proposes higher spending"):
Despite the pandemic-related recession and high unemployment
rates, and an expected drop in state tax revenues, Gov. Charlie
Baker on Wednesday released a budget proposal for the current
fiscal year that is actually higher than the budget he proposed
in January.
Baker, a Republican, is recommending a fiscal 2021 budget of
$45.5 billion, or 3.8 percent more than was spent in fiscal
2020. The budget he released in January would have spent
$44.6 billion, or 2.3 percent more than in the prior fiscal
year.
In
Massachusetts, nothing — not a thing — ever gets in the
way of spending increases. I noted in the
January 25 CLT Update:
This week the governor proposed spending $44.6 billion in the
upcoming fiscal 2021 budget — an additional $1.3 billion over
this fiscal year's record budget spending.
According to the Baker administration, "the governor's budget
would increase overall state spending by 2.3 percent above the
current fiscal year."
Stop right here and think of this: Just 2.3 percent of
the current fiscal year's spending amounts to $1.3 billion.
Just ten years ago the Legislature passed its
FY 2011 budget for $27.6 billion. That was $17 billion
less than Gov. Baker's proposed spending, only ten years
later. 2.3 percent of that FY 2011 budget would have been $635
million. 2.3 percent today is $1.3 billion.
This is what happens when unfettered spending incrementally
increases by more than a billion taxpayers' dollars piled on
year after year.
"'Pretty neat trick, huh?'
Baker said." There's nothing special about it, Charlie.
That's an increase of some $900 million above his January plan,
bringing the total to $45.5 billion for the fiscal year already four
months gone by. That brings the increase over his last state
budget (Fiscal Year 2020) to $2.2 Billion more spending.
Remember back on June 21
after the governor's first "interim" spending bill to keep the
government open
I commented:
Stop and think
about this. A $5.25 billion "interim spending bill" to get the
state through July, one month. Carried through the fiscal year
that would create a $63 billion FY2021 budget for the coming 12
months. That exceeds even the $44.6 billion Baker proposed in
January, which itself was $1.3 billion more than
last year's $43.3 budget.
CommonWealth
Magazine noted:
Baker
said he expects to submit another temporary budget
to keep government running through November, and he
hopes lawmakers can return a budget bill to his desk
by Thanksgiving. With the process likely to go past
the election, that means state lawmakers will be
voting on the budget in an unusual lame duck
session.
The State
House News Service reported:
"Baker said he'd like to see a budget back on desk
before Thanksgiving so that planning can begin for
fiscal 2022."
Expect at
least another billion or two more spending in the
next one.
Though Baker's FY20 Budget
2.0 contains no direct tax hikes there are a number of
revenue raisers. The State House News Service
reported in its Weekly Roundup:
The governor's
budget did not raise any new broad-based taxes and incorporated
the final, mandated drop in the income tax to 5 percent in
January, but he also delayed a charitable giving tax deduction
and reproposed an accelerated method for collecting sales taxes
that would net the state $267 million in one-time revenue, but
has been rejected as unworkable by the Legislature more than
once.
Hiking the income tax rate
again — which finally made
it back down to 5 percent just this year after our
decades-long battle has been left for others to
suggest. The State House News Service reported on
Tuesday ("Tax Hikes Could Push Biz Out of State, AIM
Says"):
"Tax increases now would
further destabilize businesses, many of which are
already on the edge of collapse," AIM [Associated
Industries of Massachusetts] President John Regan
was quoted saying in the blog post....
AIM's position on taxes echoed
that of the Massachusetts High Technology Council,
which last week warned that if policy leaders turn
quickly to tax increase to stabilize state finances
it would send the wrong message to employers. But
unlike AIM, the High Tech Council said it could
eventually support temporary tax hikes as part of a
multi-faceted strategy to get through the recession.
On October 7 the News
Service reported ("Budget Managers Still Sizing Up Depth
of Problems"):
. . . [Michael Goodman from
UMass Dartmouth's Department of Public Policy]
suggested the idea of temporary tax hikes to
maintain state programs that help people through the
pandemic. That notion might have more support than
others. The business-backed Massachusetts High
Technology Council has long resisted efforts to
impose new or higher taxes at the state level, but
it acknowledged as recently as Wednesday morning
that it is not entirely opposed to tax increases. .
. .
"But unlike AIM, the High Tech Council said it could
eventually support temporary tax hikes as part of a
multi-faceted strategy to get through the
recession."
"'Temporary revenue raising options may be necessary
and could attract significant support from business
leaders -- including the High Tech Council --
provided they are coupled with a combination of
prudent and forward-looking approaches that optimize
'rainy day fund' resources, budget reductions,
public procurement reforms, state borrowing and
federal aid,' Christopher Anderson wrote in his
August bulletin. The same language was repeated in a
memo sent to state legislators . . ."
I was shocked, stunned and
disappointed to see that the Massachusetts High Tech
Council was floating another "temporary" income tax hike
like the one in 1989 — in
the very year we've finally gotten it back down to 5
percent, where it was thirty years ago when CLT
began fighting to roll it back. MHTC used to be
one of CLT's best allies —
especially fighting to pass Proposition 2˝
while Howard Foley was its executive director.
Since Chris Anderson replaced him the support
disappeared.
Can Chris Anderson and the Mass High
Tech Council possibly be so naive, so uninformed? Haven't the high
tech titans recognized that there is no such thing as a
"temporary" tax increase?
So very
disappointing.
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Chip Ford
Executive Director |
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Full News Reports Follow
(excerpted above) |
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The Wall Street
Journal
Thursday, October 14, 2020
Opinion | Review & Outlook
California’s Next Big Tax Gulp
A ballot measure would repeal the business half of legendary
Prop. 13.
Sooner or later California’s public unions had to hit up the
hoi polloi to pay for their pensions after soaking what’s
left of the state’s millionaire class, and here they come.
On Nov. 3, Californians will vote on a “split roll” ballot
initiative (Prop. 15) that seeks to enact the biggest tax
hike in state history. In 1978 voters enshrined protections
against runaway property taxes in the state Constitution
(Prop 13). Prop. 15 would abolish those protections for
businesses while maintaining limitations—at least for now—on
homes.
Under current law, tax rates on residential and commercial
property are capped at 1% of their assessed value—i.e., the
purchase price—and can increase by no more than 2% annually.
If the property values of homes or businesses rapidly
inflate, owners won’t see their bills increase by more than
2% per year.
This is the only balm in California’s oppressive tax climate
and acts as a modest restraint on the government spending
ratchet. Unions know that attempting to repeal this entirely
would spur a homeowner revolt, so they are targeting
businesses.
Their split roll initiative would allow commercial property
with a current market value of more than $3 million to be
reassessed every year. If commercial property values rapidly
increase, tax bills will too. Taxes on business
property—including equipment—that hasn’t changed hands for
decades would also balloon.
California’s home prices have increased ninefold since 1978,
and commercial real estate has also appreciated enormously,
especially in coastal areas. Unions say their initiative
will only hit wealthy corporations, but not even the
Democratic-friendly NAACP believes that whopper, which is
why it and minority business groups are campaigning against
the initiative. Anyone who owns a couple of fast food
franchises would get walloped. Ditto small dairies,
wineries, orchards and manufacturers, though Democrats in
the Legislature have charitably proposed to exempt solar
farms.
Small businesses that rent space note that landlords would
pass on the tax hike in lease agreements. Less affected will
be tech titans that recently purchased properties or are
planning to down-size office space as they allow more
employees to work remotely. Facebook CEO Mark Zuckerberg is
Prop. 15’s second biggest donor.
Perhaps he’s trying to atone for his wealth, but as the
NAACP and minority business groups explained in a letter to
him in August: “Unlike Facebook, restaurants, dry cleaners,
nail salons and other small businesses can’t operate right
now and many may never open again. The last thing they need
is a billionaire pushing higher taxes on them under the
false flag of social justice.”
The state Legislative Analyst’s Office forecasts Prop. 15
would raise property taxes by $8.5 billion to $12.5 billion
a year by 2025, which is about twice as much as the state’s
2012 tax hike on high earners. Unlike that referendum, Prop.
15 revenues would supposedly go directly to schools and
local governments, which have been struggling amid swelling
pension payments.
Since 2013, pension costs have grown 130% for teachers and
doubled for other local public employees. Rising retirement
costs are limiting wage increases at the bargaining table,
and Prop. 15 is the union answer to keep the cash flowing.
United Teachers Los Angeles says passing Prop. 15 “is key to
winning the aggressive, comprehensive demands we will bring
forward in 2022”—and as long into the future as their
political dominance allows.
CommonWealth
Magazine
Wednesday, October 14, 2020
Despite pandemic, Baker proposes higher spending
Total expenditures more than what he proposed pre-COVID in
January
By Shira Schoenberg
Despite the pandemic-related recession and high unemployment
rates, and an expected drop in state tax revenues, Gov.
Charlie Baker on Wednesday released a budget proposal for
the current fiscal year that is actually higher than the
budget he proposed in January.
Baker, a Republican, is recommending a fiscal 2021 budget of
$45.5 billion, or 3.8 percent more than was spent in fiscal
2020. The budget he released in January would have spent
$44.6 billion, or 2.3 percent more than in the prior fiscal
year.
The high budget is largely driven by excessive spending in
MassHealth, the state’s Medicaid program. It would be paid
for with an influx of federal money as well as a $1.3
billion draw from the state’s $3.5 billion rainy day fund.
“The rainy day fund is there to support services when it’s
raining, and I think most people would agree it’s raining,”
Baker said at a State House press conference.
Although legislative leaders had at one point floated the
idea of having a joint budget between the governor, House
and Senate, Baker’s decision to release his own budget
proposal indicates that this will not happen. His proposal
now goes to the House.
Catherine Williams, a spokeswoman for House Speaker Robert
DeLeo said only that the House Committee on Ways and Means
has been in discussions with the administration and the
Senate regarding the fiscal 2021 budget “and will review the
budget filed by the Administration today.”
A spokesman for the Senate Ways and Means Committees did not
immediately respond to requests for comment.
Baker said he expects to submit another temporary budget to
keep government running through November, and he hopes
lawmakers can return a budget bill to his desk by
Thanksgiving. With the process likely to go past the
election, that means state lawmakers will be voting on the
budget in an unusual lame duck session.
Baker does not plan to raise taxes and would allow the
income tax rate to drop to 5 percent, the final drop
approved two decades ago in a 2000 ballot question.
“The idea of going back to taxpayers given their own
situation just didn’t seem like the right thing to do,”
Baker said.
Baker does want to delay implementing a state charitable
deduction, which was scheduled to go into effect this year
and would have cost the state $64 million in tax revenue.
Baker is also proposing “modernizing” the collection of
sales taxes by requiring large businesses to remit sales
taxes to the state more quickly. This is estimated to bring
in $267 million in one-time revenue, primarily by collecting
in this fiscal year money that would otherwise have come in
next year. It is a proposal he has made before, which has
never been approved by the Legislature.
Baker also wants to push off implementation of the Student
Opportunity Act, a major revamping of the state’s education
funding formula, that was initially scheduled to go into
effect this year. While the budget proposal includes a $108
million increase in Chapter 70 funding, that is mainly to
keep pace with inflation and enrollment changes. In
comparison, Baker’s January budget would have included $355
million in new education spending to conform with a new
education funding formula – and some advocates had said even
that was not enough.
Schools, however, are
benefitting from an extra $442 million from various federally
funded coronavirus-related grants. The governor called it “quite
an achievement” that schools overall will get more money than
anticipated – counting federal dollars – despite the pandemic.
Baker’s release of a budget proposal in October – for the fiscal
year that began July 1, 2020 – is in itself unprecedented.
Adhering to the traditional budget schedule laid out in state
law, Baker released a budget proposal in January. But by March,
Baker’s budget had become hopelessly outdated as the coronavirus
pandemic forced the state to shut down virtually its entire
economy. Since July, the Legislature has funded state government
with a series of temporary budgets, the latest of which expires
at the end of October.
At a recent hearing, the Department of Revenue estimated that
the tax revenue assumption Baker used to build his budget in
January – that the state would take in $31.15 billion in tax
revenue – was now too high, by between $2.7 and $5.2 billion.
Baker’s latest budget proposal counts on getting $3.2 billion
less in tax revenue than his January proposal, or $27.59
billion. That is a 6.8 percent drop compared to tax revenues in
fiscal 2020.
The proposal does not count on getting any additional federal
stimulus money, since it remains unclear whether Congress will
pass another stimulus bill. It does include $550 million in
coronavirus relief money the state already received.
Overall, health care spending is the clear budget driver.
MassHealth gross spending will be $1.49 billion higher than
Baker had anticipated in January, or an 8.9 percent spending
increase, due to COVID-19-related spending. Overall, the Baker
administration projects MassHealth spending of $18.2 billion, of
which the state’s share is $6.6 billion – a 10 percent increase
from fiscal 2020.
Most commercial insurers actually profited this past year, since
medical procedures were pushed off when doctors’ offices
shuttered to non-emergency care. But MassHealth had a major
increase in enrollment as people who lost jobs have migrated
from commercial plans, and new federal rules mean the state
cannot deem someone ineligible for MassHealth during the state
of emergency, even if their financial situation changes.
Enhanced federal reimbursements for Medicaid during the pandemic
means Massachusetts will get $824 million in extra federal money
to pay for the increased health care spending.
Non-health care spending will be just 0.9 percent higher than
last year. Secretary of Administration and Finance Michael
Heffernan said agency heads were asked to craft a budget based
on the lower number of either the prior year’s spending or the
spending included in Baker’s January budget.
One major area with increased discretionary spending is in a
$101 million small business recovery plan that Baker is
proposing. Most of this money would go towards grants and
technical assistance to small businesses, with a focus on
minority, veteran and women-owned companies.
Money is included for housing support, in line with a program
Baker announced Monday to prevent evictions. As he previously
announced, Baker would level-fund local aid.
The Department of Children and Families budget is lower than
Baker anticipated in January, primarily due to caseload
declines. There are slightly lower budget recommendations than
in January for a range of departments and programs, including
substance abuse programs, the Executive Office of Energy and
Environmental Affairs, the Department of Conservation and
Recreation and others. The State Police would get $411.4
million, compared to $413.1 billion envisioned in January.
The MBTA would get a $64 billion budget increase over fiscal
2020, for a total of $1.269 billion. That includes $1.142
billion in a routine transfer based on sales tax revenue and
another $40 million from the sales tax acceleration proposal.
Similar to Baker’s January budget proposal, the budget would
fund several recommendations of Baker’s Black and Latino
advisory commission, primarily related to workforce development
and training. It would allocate $8.4 million for a new job
training program in skilled trades like plumbing and
manufacturing, using vocational high schools to offer afternoon
and evening classes.
Baker is proposing the same fee hike for ride-hailing services
that he proposed in January, from 20 cents to $1 per ride, but
delaying implementation so that no new revenue is gained this
year.
“This revised proposal enables the commonwealth to make
significant investments in our recovery while continuing to fund
key services that support our continued fight against the
virus,” Baker said.
Eileen McAnneny, president of the business-backed Massachusetts
Taxpayers Foundation, said the governor’s approach makes sense,
in funding social safety net programs while not raising taxes.
“You have to recognize the fragility of the economy and not add
taxes or do anything that could further jeopardize our
recovery,” she said. “At the same time, you have to recognize
there are people who are hurting.”
Paul Craney, a spokesman for the Massachusetts Fiscal Alliance,
a conservative fiscal policy group that does not disclose its
backers, criticized Baker’s plan to accelerate the sales tax
collection and raise fees on Uber and Lyft, saying it will hurt
businesses already hit by the pandemic and demonstrates “a tone
deafness that only could live in the narrow confines of our
statehouse.”
Marie-Frances Rivera, president of the left-leaning
Massachusetts Budget and Policy Center, said while the budget
does protect core state services, it “fails to make the swift
and at-scale policy solutions needed to support the hundreds of
thousands of families in our state that can’t afford to put food
on their table or keep their families safe and housed.”
MassBudget has been pushing for tax increases on wealthy
individuals and profitable corporations. Baker on Wednesday said
he would veto any new taxes that the Legislature passes right
now. Rivera said the governor’s promise to veto new taxes “will
not help us fully address the urgent needs of communities, much
less invest in an equitable and strong recovery.”
State House
News Service
Tuesday October 13, 2020
Tax Hikes Could Push Biz Out of State, AIM Says
Remote Work Seen Loosening Ties Between Companies, Employees
By Matt Murphy
One of the state's largest and most influential business
groups urged Beacon Hill lawmakers on Tuesday to take tax
increases off the table as they consider how to put together
a state budget that accounts for major declines in revenue,
but doesn't dismantle critical state services.
Associated Industries of Massachusetts, in a message posted
to its website, suggested that it would be more appropriate
at this moment to dip into the state's $3.5 billion reserve
fund, or even utilize low-interest borrowing to keep
programs running and employees on the payroll as they wait
for Congress to provide states with financial relief.
"Tax increases now would further destabilize businesses,
many of which are already on the edge of collapse," AIM
President John Regan was quoted saying in the blog post.
The message from the group that represents more than 3,500
employers in Massachusetts came after the Department of
Revenue and other economists predicted that revenues this
fiscal year could fall roughly $1.6 billion to $5 billion
below initial projections due to the COVID-19 pandemic.
Gov. Charlie Baker is expected to update the state's
official revenue estimate this week, and he and lawmakers
will use that new number to build a budget for the rest of
the fiscal year. The governor's budget chief Michael
Heffernan said last week that the administration does not
think tax increases should be in the mix right now, but
legislative leaders were more circumspect about ruling
anything out.
Baker said last month that he believed it would be possible
to "work our way through" fiscal 2021, but added that he was
concerned about fiscal 2022 if Congress and the White House
did not deliver another round of stimulus.
AIM's position on taxes echoed that of the Massachusetts
High Technology Council, which last week warned that if
policy leaders turn quickly to tax increase to stabilize
state finances it would send the wrong message to employers.
But unlike AIM, the High Tech Council said it could
eventually support temporary tax hikes as part of a
multi-faceted strategy to get through the recession.
AIM said a new survey of Bay State employers found that
two-thirds of companies had sales below their 2020
expectations, and many were planning layoffs, furloughs,
reduced hours and pay reductions, despite surviving this
long through a pandemic shutdown and gradual reopening of
the economy.
Regan also said that the shift to remote work means that
companies are no longer as strongly tethered to
Massachusetts as they once were, and could elect to leave
the state if business tax increases create a competitive
disadvantage to staying.
"Just as online commerce removed the geographic bond between
sellers and customers, telecommuting has loosened the
geographic ties between companies and workers. Employers
concerned about tax increases in Massachusetts may now elect
to locate elsewhere. The barriers for businesses to leave
Massachusetts have never been lower," Regan said.
According to AIM, the financial struggles facing businesses
in their eighth month of operating in the midst of a global
health crisis exceed the added costs of supplying workers
with personal protective equipment and adapting to new rules
and regulations.
The trade group noted that employers are contributing $1
billion to the state's new paid family and medical leave
program and face a looming bill coming due next year from
increased unemployment insurance rates due to the state's
11.3 percent unemployment rate.
The state's minimum wage, which is currently at $12.75 per
hour, is also slated to increase automatically on Jan. 1,
2021 to $13.50.
"The current crisis provides state and local governments the
opportunity to find innovative ways to reform themselves,
just as the business community has done, so that they can
continue to deliver vital resources and services to the
people of the Commonwealth," Regan said.
CommonWealth
Magazine
Thursday, October 15, 2020
Baker budget packed with policy proposals
By Shira Schoenberg
Gov. Charlie Baker said Wednesday he understands why
lawmakers are taking a long time to negotiate the bills
currently pending in conference committees, covering topics
from police reform to economic development to health care to
transportation.
“They all passed bills that were conceptually consistent
with each other but had a heck of a lot of details in each
of them that were different,” Baker said. While he would
“love to see many enacted sooner,” the governor said he
respects the “difficult conversations.”
But that doesn’t mean Baker plans to wait for those bills to
get his policy priorities passed. Instead, he’s pinning his
hopes on the state budget.
When Baker announced his revised fiscal 2021 budget proposal
Wednesday, he included 118 “outside sections,” policy
proposals inserted into the budget.
Some relate to budget initiatives – increasing ride-hailing
fees, delaying the implementation of a state charitable
deduction, accelerating sales tax collections, and
establishing a tax credit for businesses that hire people
with disabilities. But they also include a potpourri of
other policy proposals, many of which were pulled from
earlier bills that were never enacted.
Secretary of Administration and Finance Michael Heffernan
said some came from the governor’s health care bill and
others from his transportation bond bill, versions of which
are pending in conference committees. A lot were left over
from the governor’s January budget bill, and others are
perennial initiatives the governor has never previously been
able to get passed.
Some have potential – if tenuous – budgetary ties, like
letting the state charge the decommissioned Pilgrim Nuclear
Power Station for costs related to radiation monitoring and
emergency planning, or increasing penalties on natural gas
companies for safety violations. Others, less so.
On health care, Baker is reviving proposals to let
MassHealth negotiate more drug rebates, to prohibit insurers
from charging more because a medical or behavioral health
service took place the same day as another visit, to
penalize drug manufacturers that raise prices excessively,
and to create a universal application for health care
providers to join the networks of MassHealth and commercial
insurers. A provision included in another bill related to
the Department of Children and Families would restructure a
team examining child fatalities.
Baker is reprising a provision from an old road safety bill
to let the Department of Transportation set speed limits in
construction zones and increase related fines. Also
transportation-related, he wants to create metrics to
standardize how Regional Transit Authorities are funded.
Heffernan described some of the new items as urgent matters
– presumably things like Baker’s proposal to give the
Department of Public Health more authority over nursing home
licensing or to create a COVID-19 recovery fund for early
education providers.
But others seem far from urgent: Repealing a blue law to
“allow the hunting of deer by bow and arrow on Sundays” or
repealing a prohibition on catching edible crabs from
coastal waters between January and April.
Others are perennial retreads that appear no more likely to
pass this year than previously. A 15 percent excise tax on
manufacturers of opioid medications got a lot of attention
when Baker introduced it in 2019. But lawmakers declined to
pass it then, and although it is included in an outside
section in this year’s budget, it did not merit a mention in
Baker’s press conference, and the budget does not rely on
any revenue from it.
When Baker first tried to cap sick time accruals for state
employees to 1,000 hours in 2016, it created controversy and
got strong union pushback. By now, the pattern has been
established over several years: Baker repeatedly introduces
the proposal, as he did again this week, and lawmakers
repeatedly ignore it.
The Boston
Herald
Thursday, October 15, 2020
Budget watchdog warns reliance on coronavirus rainy day fund
to balance $45.5B budget could set Massachusetts up for
fiscal storm
By Erin Tiernan
A reimagined $45.5 billion spending plan that relies heavily
on the state’s rainy-day fund to balance the state budget in
an era of freefalling tax revenues could be setting the
state finances up for a “challenging” fiscal storm in the
future, budget watchdogs warned.
To help make up for a gaping $3.6 billion shortfall in
anticipated tax revenues spurred by widespread business
shutdowns amid the pandemic, Gov. Charlie Baker’s proposed
budget would drain $1.35 billion from the state’s rainy-day
fund — a move he says is necessary to avoid cuts in services
and layoffs.
“This budget plan reflects the new realities associated with
COVID-19, but it continues to make significant investments
in education and economic development and it does not raise
taxes,” Baker said, speaking at the State House on
Wednesday.
Baker’s plan actually represents a 3.8% — nearly $1 billion
— funding boost over his initial January budget. Budget
Chief Michael Heffernan blamed the increased spending on the
strain coronavirus has placed on the state’s Medicaid
system, which has seen thousands flock to enroll amid mass
unemployment.
Baker is also proposing $101 million in new grants, loans
and resources for the state’s struggling small businesses.
With anticipated tax revenues coming in $3.6 billion under
early-year predictions, Baker’s plan would balance the
budget by drawing on $1.35 billion in rainy-day funds,
roughly $830 million in federal Medicaid reimbursements,
$550 million in federal coronavirus aid, and using $422
million that rolled over from last year’s budget.
The governor said his plan allows “significant investments”
while avoiding any broad-based tax increases, layoffs, or
cuts to social and health safety net programs, and
level-funds local aid, consistent with an agreement
announced with the Legislature in July.
But budget watchdogs disagree.
Eileen McAnneny of the centrist Massachusetts Taxpayers
Foundation warned of “challenging” times to come in the next
fiscal year. The “vast majority” of one-time funding the
governor relies on to balance this year’s budget is “not
replicable,” she said.
“The state will have to hope for further federal assistance,
an economic rebound and strong tax revenue growth because
the $2.2 billion remaining in the Stabilization or Rainy Day
Fund is not sufficient to weather this storm,” she said.
The plan still needs the sign-off from lawmakers, and
legislative leaders on Wednesday shed little light on what’s
sure to be agonizing and abbreviated deliberations.
A spokeswoman for Speaker of the House Robert DeLeo would
only say the Joint Committee on Ways and Means has “been in
discussions” with administrative leaders and “will review
the budget.”
The left-of-center Massachusetts Budget and Policy Center
criticized the budget that level-funds most services as not
going far enough, saying it “fails … to support the hundreds
of thousands of families in our state that can’t afford to
put food on their table or keep their families safe and
housed.”
Paul Craney of the conservative Massachusetts Fiscal
Alliance, however, criticized the failure to cut spending
saying the state “continues to head in the wrong direction.”
State House
News Service
Thursday, October 15, 2020
Baker Budget Retains Nearly 10 Percent Pension Funding Hike
By Colin A. Young
Despite falling state tax revenues and a budget that has
been redrawn to reflect the havoc of a pandemic, the Baker
administration confirmed Wednesday that Massachusetts will
stick to the aggressive plan to chip away at the state's
pension liabilities.
The Legislature and administration agreed before the
pandemic to hike the state's annual pension payment by more
than 9.6 percent each year -- and by more than 30 percent
over the three-year period -- as it works to stash away
money to cover the $41 billion unfunded portion of the
expected pension liability of more than $96 billion.
The $3.115 billion transfer to the pension fund in the
fiscal year 2021 budget, an increase of roughly $274 million
or about 9.6 percent over the fiscal 2020 contribution, and
the triennial schedule that it is part of means the state's
annual pension contribution will have to grow at a clip far
more rapid than what is forecasted for state tax revenue in
order to remain on track to fully fund the liability by
2036.
State tax revenue was initially projected to grow by 2.8
percent in fiscal year 2021, but now the administration is
expecting it will actually come in 6.8 percent below fiscal
year 2020 actual collections.
The Massachusetts Taxpayers Foundation on Wednesday cited
the Baker administration's decision to honor the pension
funding schedule it previously agreed to as one example of
why the Baker revised budget "is not as austere as some
would have anticipated."
Though it was not a main topic of discussion Wednesday when
Gov. Charlie Baker held a press conference to unveil his
revised budget, the governor mentioned that his new budget
"keeps to the pension schedule that we announced back in
January."
The funding schedule will limit other options for lawmakers
as they craft the state's annual budget, but it also impacts
the approximately 314,637 retired or active state employees
and municipal teachers who are part of the Massachusetts
State Employees' Retirement System or the Massachusetts
Teachers' Retirement System.
State House
News Service
Thursday, October 15, 2020
Legislature Leaves Eviction Crisis to Baker, Courts
Opts Against Intervening With Moratorium About to End
By Matt Murphy
House and Senate leaders on Beacon Hill chose not to
intervene Thursday to block the expiration this weekend of
the state's moratorium on evictions and foreclosures,
despite the efforts of one Democrat to force an emergency
extension of the ban through the end of the year.
Gov. Charlie Baker on Monday put forward an eviction
diversion plan that allows the moratorium to expire on
Saturday, but also pumps $171 million into rental assistance
and other measures to try to keep people facing economic
hardship from the COVID-19 pandemic in their homes.
Baker said his approach was preferable to allowing renters
and homeowners to fall deeper into debt, but many advocates
and lawmakers said the initiative was insufficient to meet
the need and prevent a housing crisis at a time when
coronavirus infection rates are rising.
Rep. Michael Connolly, a Cambridge Democrat, showed up
during a lightly attended informal session of the House on
Thursday to file an emergency petition that would extend the
moratorium until Jan. 1, 2021.
Connolly said that the extension would give Baker more time
to get the pieces of his eviction diversion plan in place,
and also allow the Legislature to continue to work on
legislation he filed with Housing Committee Chairman Kevin
Honan and dozens of other Democrats in the Legislature to
extend the moratorium for much longer.
"Most of the key pieces of the governor's initiative that
will help tenants and even help landlords aren't in place
yet, the legal representation, the community mediation,"
Connolly said after the session.
The House admitted Connolly's petition and referred it to
the Joint Committee on Housing, but further action required
concurrence from the Senate, which had already adjourned for
the day. Connolly ultimately doubted the presence of a
quorum to force the House to end its session Thursday,
though it was unclear whether the House had any business
left on its agenda for the day. Both branches plan to return
on Monday.
"I think it's a matter of the action that we need to take
requires a quorum and we haven't had a formal legislative
session in two and half months, which is frankly
disappointing to me," Connolly said about the actions he
took.
While Connolly was inside the State House, demonstrators had
planned a march from the Brooke Courthouse in Boston to the
State House to protest the expiration of the moratorium,
which some advocates have estimated could lead to the
evictions of 80,000.
Homes for All Massachusetts and the Massachusetts COVID-19
Response Alliance also demonstrated outside the governor's
house in Swampscott on Wednesday to seek his support for the
Honan-Connolly bill (H 5018) that would keep an eviction and
foreclosure moratorium in place until one year after the
COVID-19 state of emergency ends, freeze rent during that
time, and create a fund to help distressed small landlords.
The COVID-19 Housing Stability Act has cleared the Housing
Committee, but Honan said this week it requires more time
and work and he had hoped Baker would extend the moratorium
to allow that work to happen.
Connolly said that despite voting in July to extend the
legislative session until the end of the year lawmakers have
"ceded our responsibility for policy making in this critical
moment of pandemic and economic meltdown" to the governor.
"When you think about the concerns of our constituents, the
challenges facing the commonwealth, I would like us to
actually utilize the abilities we have to make policy and
pass legislation," Connolly said.
State House
News Service
Thursday, October 15, 2020
Invite-Only Hearing on Baker Budget Set for Wednesday
By Matt Murphy
The House and Senate Ways and Means committees will hold a
virtual hearing featuring invited testimony next week on
Gov. Charlie Baker's revised $45.5 billion budget, which the
Republican filed on Wednesday and said he hopes to see
completed and returned to him before Thanksgiving.
Rep. Aaron Michlewitz and Sen. Michael Rodrigues will host
the noon hearing next Wednesday from the State House, and
said they look forward to hearing from "members of the
Administration, our colleagues, and the general public."
The committee chairs did not release a list of who will be
invited to speak, but said guests will participate remotely
via video or audio conference. Baker filed an updated budget
plan that relies on $1.8 billion in federal relief funding
and $1.35 billion in reserves to cover up a $3.6 billion
decline in anticipated tax revenue.
"In order to proceed in an open and transparent manner, we
feel that it is vital that this revised budget receive a
public hearing. By doing so, members of the Legislature, and
the public as a whole, will have a chance to get a better
understanding of the budgetary decisions that are before the
Commonwealth in the coming weeks," Michlewitz and Rodrigues
said in a joint statement.
The fiscal 2021 budget is more than three months late after
state officials elected to use interim budgets to start the
fiscal year in July while waiting to see how the economy
rebounded from the early effects of the COVID-19 pandemic.
Baker said he'd like to see a budget back on desk before
Thanksgiving so that planning can begin for fiscal 2022.
Rodrigues called Baker's budget "very good" Thursday and
said the House and Senate would pass a budget "over the next
few weeks."
The committees early this year heard from several Baker
administration officials at hearings on the initial budget
filed he filed in January, but those hearings were cut short
March 11 with the last two hearings, including one for the
general public, postponed indefinitely.
State House
News Service
Friday, October 16, 2020
Weekly Roundup - Neat, But Not Tidy
Recap and analysis of the week in state government
By Matt Murphy
It's easier to understand now why Gov. Charlie Baker didn't
want to cancel Halloween. He had his costume all picked out.
And no he's not dressing as Donald Trump.
Whether by sleight of hand or happenstance, Baker, the
budgetary magician, managed to take a lot of the sting this
week out of an exercise in fiscal obligation that
legislators had been wringing their hands over for months,
spooked by the pain it would inflict.
The longer Washington took to fight over the next stimulus
package, the longer Beacon Hill could put off its inevitable
need to pass a balanced budget for the year. Even, and maybe
most importantly, if that meant waiting until after the
election.
That can-kicking stopped Wednesday.
Baker waved his wand and updated the state's revenue
forecast to reflect a $3.6 billion drop in tax collections
compared to what had been projected back in January. It was
better than the $5 billion to $8 billion once feared, but it
wasn't couch change either. Then for his next act, Baker
submitted a revised state budget to the Legislature that
actually increased proposed spending by about $900 million
from his January plan, tipping the scales at $45.5 billion
for the year.
"Pretty neat trick, huh?" Baker said, smiling wryly at a
question about how he accomplished that feat.
But it didn't take David Copperfield to unravel how he did
it. A combination of federal relief money and tapping the
state's "rainy day" savings fund to the tune of $1.35
billion got the budget almost all the way back to black. Add
in another $515 million in savings squeezed out of agency
budgets by asking them to forgo increases from fiscal year
2020 and voila.
The governor's budget did not raise any new broad-based
taxes and incorporated the final, mandated drop in the
income tax to 5 percent in January, but he also delayed a
charitable giving tax deduction and reproposed an
accelerated method for collecting sales taxes that would net
the state $267 million in one-time revenue, but has been
rejected as unworkable by the Legislature more than once.
The MBTA also continues to contemplate major service
reductions as MassHealth, the state's Medicaid program,
consumes much of the proposed spending growth in the budget,
and schools are being told to wait on the full funding
promised in last year's Student Opportunity Act.
Needless to say, Baker's updated budget recommendation was
just the start of the process, and one the governor
optimistically said he'd like to see wrapped up by
Thanksgiving.
While that may take another act of magic to accomplish,
Senate Ways and Means Chairman Michael Rodrigues called it a
"responsible" plan that gives the Legislature a "good
foundation" to build their own budgets - even if that
foundation is built on one-time money.
A virtual hearing on the governor's revised budget has been
planned for next Wednesday, and the timeline after that
remains anyone's guess. The budget revision came on the
heels of Baker throwing more money at another problem:
housing stability.
Prepared to let the moratorium on evictions and foreclosures
expire on Saturday, the administration released a plan
Monday that it developed with Trial Court Chief Justice
Paula Carey to try to stem the rising tide of eviction
proceedings by increasing rental assistance by $100 million
and bolstering landlord-tenant mediation and other supports.
Without knowing exactly how many residents are at risk of
losing their homes, Baker said it was too risky to let
tenants continue to accumulate debt if they can't afford to
pay their rents. Many advocates applauded the direction the
proposal took, but some said the governor's $171 million
plan won't address the true needs.
Demonstrators and political leaders, from state Rep. Kevin
Honan to U.S. Rep. Ayanna Pressley and Attorney General
Maura Healey, continued to pressure Baker all week to extend
the moratorium, at least until he could get his own program
up and running. But they did so in the face of overwhelming
evidence that the governor had no intention of taking that
step.
Rep. Mike Connolly of Cambridge even tried Thursday to force
passage of an emergency petition to extend the moratorium
until January, but the furthest he got was getting the bill
admitted to the House.
Connolly said at the very least his petition would give
Baker more time to get the tenant and landlord support
services that are part of his own plan up and running, which
they won't be by Monday.
And at most, it would give legislators like him and Honan
more time to convince leadership on Beacon Hill to pass a
popular housing stability bill that would not only extend
the moratorium until a year after the health emergency is
lifted, but also freeze rents during that time.
As it stands, the moratorium is set to lift this weekend.
But that doesn't preclude legislative action in the days or
weeks to come.
"When you think about the concerns of our constituents, the
challenges facing the commonwealth, I would like us to
actually utilize the abilities we have to make policy and
pass legislation," Connolly said, expressing his frustration
that neither the House nor the Senate has met in a formal
session since July 31, despite voting to extend formal
sessions beyond that date in part to deal with
pandemic-related issues.
Now the middle of October, Massachusetts has seen its
average daily COVID-19 case rate over the past two weeks
climb to 8.7 cases per 100,000, which would put it in the
state's own highest risk "red" category if it were a city or
town.
But Massachusetts is not a town. And Baker made clear that
he's not putting much stock in where Massachusetts stands
collectively on the virus transmission scale, just where
communities stand. Because, he said, there continue to be
many, many municipalities where COVID-19 is contained.
Still, 27 more cities and towns moved into the highest risk
category this week, bringing the total to 64 of the 351
municipalities, including many of the the state's largest
cities.
"There's no question that there will be more cases this
fall," Baker said.
Good thing Massachusetts is prepared, according to the
governor.
Sandwiched between his housing announcement on Monday and
his budget rollout on Wednesday, Baker staged a press
conference with the lieutenant governor and multiple cabinet
secretaries to tick through everything the state has done
since March to respond to the pandemic, and how that
experience has prepared the government to deal with a fall
surge, if it arrives.
Adequate supplies of personal protective equipment are on
hand, hospitals stand ready to quickly build out ICU
capacity and the state's testing and tracing program is no
worse than second to one, the governor assured.
"We've done the work. We're prepared to respond to this
virus like never before," Baker said. "But our preparations
are of little use without the people of Massachusetts
continuing to do their part."
In Massachusetts, that part involves wearing a mask, which
President Trump continued to equivocate on the value of this
week after recovering himself from COVID-19. Trump's
attitude toward COVID-19 and Baker's opinion of the federal
government's response to the pandemic are undoubtedly part
of the reason Baker won't be voting for Trump, which the
governor confirmed this week to the surprise of no one.
Baker, however, did not endorse Joe Biden and suggested he
might not vote at all.
He could always follow the lead of his good friend and
fellow anti-Trump Republican Gov. Larry Hogan of Maryland,
who, according to the Washington Post, wrote in Ronald
Reagan on his ballot when he voted early.
STORY OF THE WEEK: Filling a $3.6 billion budget hole...
State House
News Service
Friday, October 16, 2020
Advances - Week of Oct. 18, 2020
While Beacon Hill points its collective finger at the
partisan sniping and stimulus bill failures in Washington,
it's ironically $1.8 billion in federal funds that are
backstopping the $45.5 billion state budget proposal that
will occupy the Legislature's attention over the next
several weeks.
"It's our hope that we'll get this back before
Thanksgiving," Gov. Charlie Baker said Wednesday as he
submitted to the Legislature a new version of the fiscal
2021 budget that he first filed back in January.
The historic turnaround time for an annual budget will only
be accomplished with a rare level of harmony between House
and Senate Democrats on Beacon Hill, whose intraparty
troubles agreeing on major priorities this year are on par
with the more common partisan divisions that are the primary
obsessions of media and election year activity.
Baker padded his spending plan with an extra $900 million
compared to his initial budget, proposing to drain more than
$1.3 billion from the state's reserves to offset a sharp
decline in tax collections that state officials believe will
materialize in the coming months as economic growth
decelerates and the grip of COVID-19 again intensifies. The
use of more than $3 billion in one-time revenues may hold
this year's budget together, but could turn into a risky
gambit if the economy does not bounce back in time to shore
up the tax base in fiscal 2022.
Legislative leaders have not said whether they agree with
the governor's fiscal 2021 revenue markdown and they are now
being watched closely to see whether they delve into any of
the areas that Baker avoided in his budget - raising taxes,
borrowing, and major spending cuts - and whether they object
to his use of so much one-time revenue.
With an annual budget already well more than three months
overdue, lawmakers this week quickly scheduled a hearing on
Baker's massive plan for next Wednesday at noon. But with
the elections coming up in just over two weeks, Beacon
Hill's unspoken plan to push all of its remaining
controversial and complex work off, including the budget,
until after the elections is appearing more likely by the
day.
Before the Legislature dives into its lame-duck session,
action is possible before the Nov. 3 election on a $424
million spending bill (H 5014) to close the books on fiscal
2020, which could require a formal session unless Democrats
can get complete buy-in from all House and Senate members.
That piece of important business, which relies on spending
capital gains revenues rather than dumping them into the
rainy day fund, looms as early voting begins on Saturday,
Oct. 17 ahead of the Oct. 24 deadline for would-be voters to
register if they wish to participate in this year's
elections. The early in-person voting period ends Oct. 30.
Wednesday's budget hearing punctuates a week with other
storylines that are already in progress ...
Rising community transmission of COVID-19 and red zone
anxiety are spurring increased talk about when the second
surge will come, how bad it will be, and whether economic
and school reopenings will need to be scaled back ...
State health care officials hold their annual hearing on
cost trends, but this year it's a half-day affair on Tuesday
with a particular focus on COVID-19 impacts ...
An eviction watch is underway, with supporters of Gov.
Baker's diversion plan hoping it will provide enough aid to
keep people housed despite unpaid rent during the pandemic
and critics still calling for an extension of the eviction
moratorium that is set to end Saturday ...
And as a massive amount of voting appears to have occurred
already or is occurring through a new mail-in voting option,
the week ahead brings another new option that will reduce
lines on Nov. 3 and get even more of the vote in before
election day: early in-person voting.
The two-week period of early voting begins Saturday, Oct.
17, the earliest that the state has ever offered in-person
voting before an election. Early voting expansion was one of
the features in the election reform package lawmakers and
Gov. Charlie Baker approved this year, which also authorized
no-excuse mail-in voting, to help mitigate risks of COVID-19
transmission at polling places.
Each city and town must make at least one location available
for in-person voting on Saturday and Sunday this weekend and
next weekend, plus host early voting during normal business
hours Monday through Friday.
Early voting runs through Oct. 30, the Friday before the
Nov. 3 general election. Locations will also function as
ballot drop-off centers for any voters who requested a
mail-in ballot and would prefer to return it in person.
More than 208,000 people in Massachusetts voted early
in-person ahead of the Sept. 1 primary election,
representing about 12 percent of all ballots cast, according
to Secretary of State William Galvin's office. It was the
first time the state offered early in-person voting before a
primary election. A list of each municipality's early voting
locations and hours is available
here.
The Boston
Herald
Friday, October 16, 2020
Gov. Chris Sununu plans to sue Massachusetts over policy
taxing N.H. telecommuters
Sununu: Tax on remote workers a ‘direct attack’ on N.H.
By Lisa Kashinsky
New Hampshire Gov. Chris Sununu plans to take Massachusetts
to court over the Bay State’s policy taxing the income of
out-of-state residents telecommuting for Bay State companies
amid the pandemic.
Sununu announced plans Friday to sue the Baker
administration in the U.S. Supreme Court over the policy he
called a “direct attack” on New Hampshire.
“The Commonwealth has launched a direct attack on the New
Hampshire Advantage, attempting to pick the pockets of our
citizens,” Sununu said in a statement. “We are going to
fight this unconstitutional attempt to tax our citizens
every step of the way, and we are going to win.”
The latest salvo in the ongoing income-tax border battle
comes as the Massachusetts Department of Revenue on Friday
finalized a temporary rule that imposes the state’s 5%
income tax on employees of Massachusetts companies living
and working remotely in other states as the public health
crisis wears on.
“Within five minutes of learning of this rule change, I
immediately directed the Department of Justice to file a
lawsuit in the United States Supreme Court on Monday,”
Sununu said.
The regulation published Friday extends the temporary rule
through Dec. 31 or 90 days after Gov. Charlie Baker lifts
the commonwealth’s COVID-19 state of emergency — whichever
comes first.
Under the policy, employees who live outside Massachusetts
are only taxed for the number of days during week they would
have physically commuted into the Bay State for work, which
the state Department of Revenue said aligns with
pre-pandemic taxation rules. Nearly 100,000 Granite Staters
normally commute to work in Massachusetts, according to a
2017 study.
Department of Revenue spokeswoman Naysa Woomer defended the
policy in a statement saying, “The Commonwealth has
implemented temporary regulations that are similar to those
adopted by other New England states.” The administration
said it would not comment on pending lawsuits.
Sununu, the Republican New Hampshire governor, had
threatened to sue over what he called the “unconstitutional
taxation” of Granite Staters back in August, when the
extension of the policy was first proposed.
The Republican New Hampshire governor’s Justice Department
reviewed the proposed rule at the time and found it “raised
various legal concerns.”
Paul Craney of the Massachusetts Fiscal Alliance said in a
statement Friday that the policy was “especially cruel” for
residents of New Hampshire, where there is no state income
tax, and warned it might prompt companies to leave
Massachusetts.
“These workers are no longer using our state’s resources to
do their jobs,” Craney said. “Taxing them at this point is a
blind money grab with no fee for use aspect.”
The Boston
Herald
Saturday, October 17, 2020
Charlie Baker packs the SJC with his picks – and no pushback
By Peter Lucas
Joe Biden ought to be like Charlie Baker when it comes to
packing the court.
Because there is a difference between “packing” and
“stacking.”
Biden wants to pack U.S. Supreme Court. Baker wants to stack
the Massachusetts Supreme Judicial Court.
In only a matter of weeks, Baker, the RINO (Republican in
name only) governor of Massachusetts, will have named all
seven members of the Massachusetts Supreme Judicial Court
and, unlike in Washington, no one is complaining.
One reason for the lack of critical commentary is that
Baker’s appointees to the high court reflect Baker’s liberal
views. Massachusetts is an overwhelmingly liberal,
Democratic state that has grown increasingly progressive, as
has Baker. He is the type of Republican that Democrats love.
Another reason is that Baker is not really “packing” his
high court by increasing the number of justices, the way the
Democrats want to do to the nine-member Supreme Court in
Washington.
Instead of “packing,” Baker is “stacking.” You might even
say he is “stocking,” as in stocking the shelves of the
court with liberals who are just like him.
Either way Baker is keeping the number of justices on the
high court in Massachusetts at seven. Biden and the posse of
progressives surrounding him want to load up the U.S.
Supreme Court with Democrats, perhaps even making Sen.
Elizabeth Warren chief justice.
Baker, anyway, will have stacked or stocked, the state SJC
will all seven members by the end of 2020 or early 2021.
Unlike the U.S. Supreme Court, where members serve for life,
in Massachusetts SJC justices face mandatory retirement at
age 70.
Baker appointed five associate justices to the court during
his first term as governor. They are Frank Gaziano, David
Lowly, Kimberly Budd, Elspeth Cypher and Scott Kafker.
He will shortly make two more appointments, one to fill the
vacancy left by the recent death of Chief Justice Ralph
Gants and the pending retirement of Justice Barbara Lenk,
who shortly turns 70.
The turnover in the court has generally been viewed in a
positive light. Former SJC Chief Justice Margaret Marshall,
in an interview on WCVB-TV’s “On the Record,” said it was
something that Washington should look into.
Marshall, who retired in 2010, also said that the packing
U.S. Supreme Court “should be looked at very carefully,”
although she was not opposed to it.
Turning political, Marshall accused U.S. Senate Majority
Leader Mitch McConnell of attempting to “hijack” the court
by pushing through President Trump’s appointment of Amy
Coney Barrett just before the election.
“I think there has been an attempt by the current majority
leader of the Senate — I regret to say so — to hijack the
court and push through the people he wants in a way we have
not seen before,” she said.
“The Supreme Court is not a political football and should
not be a political football,” she said.
What is ironic about this is that the appointment of
Marshall to the SJC by Republican Gov. Bill Wed in 1996 was
something of a political football in and of itself.
Back then, Weld, coming off a smashing re-election victory
over Democrat Mark Roosevelt — Weld got an astonishing 71%
of the vote to Roosevelt’s 28% — wanted to go national. U.S.
Sen. Bob Dole was the frontrunner for the 1996 GOP
presidential nomination.
Weld held a series of strategy meetings to work out a
national strategy, which included raising his national
profile.
As part of that media strategy, Weld wanted to curry favor
with the national press, starting with the late
Cambridge-based Anthony Lewis, then a highly influential and
respected Harvard intellectual and national columnist at The
New York Times.
Lewis was married to Margaret Marshall who was special
counsel at Harvard University. And Weld just happened to
have an opening on the SJC.
“Wouldn’t it be a good idea to appoint Margaret Marshall,”
an aide suggested, even though she had not applied.
Although she had no experience as a judge, Marshall was a
partner at the prestigious law firm of Choate, Hall &
Stewart and had been president of the Boston Bar
Association.
It was a twofer. Weld filled the vacancy with Marshall and
befriended Lewis. Weld’s national ambitions never got off
the ground, though, then or later.
Marshall was subsequently promoted to chief justice by then
Gov. Paul Cellucci in 1999. After serving with distinction,
Marshall retired in 2010 to care for Lewis who had
Parkinson’s disease. He died in 2013.
The Boston
Globe
Wednesday, October 14, 2020
‘So transparently deceitful.’ Ending census early
will leave parts of Boston uncounted, possibly resulting in
less aid
By Zoe Greenberg
Massachusetts officials warned Wednesday that a Supreme
Court decision allowing the Trump administration to halt the
census count early could result in a botched final tally,
even as federal officials asserted that the vast majority of
households in the state had already been counted.
The disagreement underscored the high stakes of the most
logistically challenging and politically contentious count
in recent memory. The census is used to calculate federal
funding and determine congressional seats; for
Massachusetts, roughly $16 billion is on the line.
“We have parts of our city that are going to be
undercounted,” Mayor Martin J. Walsh said in a phone
interview on Wednesday, adding that a low count would
curtail funds for housing and food aid in the city.
The Census Bureau has said that while only 69 percent of
households in the state “self-reported” online, by phone or
mail, census employees successfully counted the rest by
going door to door, achieving a 99.9 percent completion
rate. But local officials and census experts believe that
number is far too optimistic because, they say, federal
officials are purposefully painting a too rosy picture and
because in-person counting is much less reliable than
self-responses.
“It’s fictional to talk about 99.9 percent,” said Secretary
of State William F. Galvin, the state’s official liaison to
the 2020 Census, who has been involved in two previous
counts. “The whole concept of short-circuiting this thing
and ending it early when it’s had so many problems is so
transparently deceitful.”
Census experts agreed that the high completion rate didn’t
present the full picture.
“Does it mean they have knocked on every door, they have
talked to somebody in that household, and gotten responses
from everyone living there? Absolutely not,” said Terri Ann
Lowenthal, a longtime census consultant based in
Connecticut.
Lowenthal pointed out that just because a household has been
“counted” doesn’t mean it has been counted accurately. For
example, instead of direct interviews, census employees can
rely on proxies, like neighbors or landlords, as well as
administrative data, both of which are more likely to result
in incorrect information.
Galvin said census officials have declined to provide
municipal-level data to the state about where people had
responded and where the gaps were. This makes it impossible
to determine where more outreach is necessary, or even how
many of the 30 percent of people who did not self-respond
were legitimately counted by census officials, he said.
Galvin is also skeptical of the high number touted by the
Census Bureau because his office has been working to address
some of the challenges to in-person counting — like getting
access to apartment buildings — even as federal officials
said the counting was finished.
“The numbers have been very erratically rising,” he said.
Federal census officials disputed that notion. Jeff T.
Behler, regional director of the census, said that it was
too labor intensive to provide municipal-level data to the
state but that he was confident the count had been
comprehensive.
“We have knocked on every address. We have gotten a response
from nearly all of the addresses in the Commonwealth of
Massachusetts,” Behler said in an interview.
In the absence of specific data, state officials and
advocates fear tallies will be low in such historically
hard-to-count communities as Lawrence and Chelsea, which
have high populations of renters, immigrants, and college
students. The same cities have been hardest hit by the
coronavirus and rely the most on federal aid distributed
using census data.
“We are very concerned,” said Eva Millona, executive
director of the Massachusetts Immigrant and Refugee Advocacy
Coalition and chairwoman of the state’s 2020 Complete Count
Committee. “It’s about resources. It’s about political
power.”
From the start, the 2020 Census has been marred by political
interference and hampered by the pandemic. First, the Trump
administration’s failed effort to add a citizenship question
sent terror through immigrant communities already wary of
sharing information with authorities. Then the coronavirus
forced a massive national operation to rapidly transition
from in-person to digital.
The most recent obstacle arose after the Trump
administration sought to end the count a month early,
claiming that the Census Bureau needed extra time to deliver
results by the end of December. A collection of local
governments and civil rights groups sued, but on Tuesday the
Supreme Court said that the administration could halt the
tally ahead of schedule.
Governor Charlie Baker said at a news conference Wednesday
that “getting the census count right is critically
important.”
“This is one where a few extra weeks of collection,
especially given the impact of the pandemic and people’s
ability to do door-to-door work, would always be better,”
Baker said.
Galvin said the Census Bureau told him that door knocking
will end at 11 p.m. on Thursday, while self-responses will
end early Friday. The state had planned census outreach at
early voting sites this weekend, Galvin said, but was
required to cancel those events.
“Any day, they’ll have a balloon drop to say they’re
finished,” he said. “Even though we know we’re not.”
State House
News Service
Tuesday, October 13, 2020
GOP Leaders Form PAC in Election Stretch Run
Kaufman: Strategy Creates New Outlet to Help GOP Candidates
By Matt Murphy
With voting set to end in Massachusetts in 22 days, three
prominent state Republicans announced on Tuesday that they
had formed a political action committee to support GOP
candidates for state, local and county offices.
Republican National Committee Treasurer Ron Kaufman and
Janet Fogarty, the state's other RNC member, said that every
dollar donated to The Fund for Massachusetts Future PAC,
outside of small administrative expenses, would go to
supporting local candidates.
The focus, they said, could potentially open the door to
donors who might want to support local Republicans, but
don't want to contribute to federal candidates in a cycle
when attitudes toward President Donald Trump and Congress
are a motivating factor.
"Everyone talks about how critical of an election this is.
Our candidates on the ground deserve support, and we needed
to develop a giving strategy that keeps all dollars here in
Massachusetts. It's what's best for donors and what's best
for candidates," Kaufman said.
The paperwork for the PAC was filed with the Office of
Campaign and Political Finance on Oct. 1, and lists the
promotion of "fiscal conservatism and job growth in the
commonwealth" as its objective. The committee will be
chaired by Michael Sullivan, a former state lawmaker and
U.S. Attorney who has also run for U.S. Senate.
Sullivan compared the Legislature on Beacon Hill, where
Democrats control 164 of 200 seats in the House and Senate,
to a monopoly, which he said is not good for business or
public policy.
"Successful campaigns need great candidates, grassroots, and
financial support," Sullivan said. "The narrative needs to
be kept on why our Republican candidates for state and local
offices are better for the taxpayers, better for public
policies, better for education, and better for attracting
and retaining good jobs and businesses."
The treasurer of the new PAC is Michael Valanzola, a
one-time candidate for state Senate who worked in the Baker
administration in the Executive Office of Energy and
Environmental Affairs. Valanzola was forced to resign amid a
scandal over whether his cousin had tried to pressure the
husband of one of his employees not to run against a
Republican senator.
The formation of the new PAC by the party leaders comes
during a cycle in which many in the MassGOP admit that it's
a difficult election for Republicans with President Donald
Trump at the top of the ticket, given the president's
unpopularity.
Not counting candidates for federal office, there are 66
Republicans on the ballot this fall, with just 19
challenging Democratic incumbents in the Legislature and
almost as many defending their seats from challenges from
Democrats.
The state party's fundraising has also lagged in the midst
in the pandemic, and without any real support from the
de-facto leader of the party Gov. Charlie Baker. As the
party has moved toward Trump under the stewardship of
MassGOP Chair Jim Lyons, Baker has moved away from the
president and national politics, despite his endorsement of
U.S. Sen. Susan Collins in Maine.
Baker has said that outside of that endorsements he and Lt.
Gov. Karyn Polito intended to keep their politicking
confined to campaigning for some legislative candidates,
though that has yet to really happen.
Without Baker and with COVID-19 inhibiting more traditional
fundraising efforts, the state party's finances have taken a
hit. Through the end of August, the party reported raising
just over $1.5 million this cycle for its federal account,
which can be used for party operations, compared to more
than $5 million in 2017 and 2018.
Asked if the Fund for Massachusetts Future PAC was created
because the party was struggling to adequately support its
candidates, Kaufman said it was intended to lure donors who
might be hesitant to give because of the national climate.
In addition to state legislative and county candidates, the
MassGOP has five candidates running for Congress and one
challenging for the U.S. Senate.
"This PAC is dedicated to putting resources in the hands of
Massachusetts candidates directly, a prospect that more
Massachusetts Republican supporters are willing to
contribute to, especially given the national climate. We see
this PAC as different in function than the state party,
which directs resources to national issues, federal
candidates, and staff in addition to local and state
candidates. We believe our support will help our candidates
be successful," Kaufman said.
No one involved with the PAC plans to take a salary. As of
Tuesday, the PAC had not yet filed any reports on spending
or fundraising.
A separate super PAC run by allies of Gov. Baker -
Massachusetts Majority super PAC - has spent nearly $230,000
in 2020 to support local and state candidates, including
Democrats and Republicans. |
NOTE: In accordance with Title 17 U.S.C. section 107, this
material is distributed without profit or payment to those who have expressed a prior
interest in receiving this information for non-profit research and educational purposes
only. For more information go to:
http://www.law.cornell.edu/uscode/17/107.shtml
Citizens for Limited Taxation ▪
PO Box 1147 ▪ Marblehead, MA 01945
▪ (781) 639-9709
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