 |
Post Office Box 1147
▪
Marblehead, Massachusetts 01945
▪ (781) 639-9709
“Every Tax is a Pay Cut ... A Tax Cut is a Pay Raise”
48 years as “The Voice of Massachusetts Taxpayers”
— and
their Institutional Memory — |
|
CLT UPDATE
Tuesday, August 23, 2022
Attorneys for
MassFiscal, CLT Notify Auditor Bump of Pending Taxpayers Lawsuit
Jump directly
to CLT's Commentary on the News
|
Most Relevant News
Excerpts
(Full news reports follow Commentary)
|
|
The
Massachusetts Fiscal Alliance, the Fiscal Alliance
Foundation, and Citizens for Limited Taxation
announced today that they have partnered with the
New England Legal Foundation and the Goldwater
Institute to prepare to bring suit to enforce
Chapter 62F of Massachusetts law, should such action
be necessary. Jon Riches is the lead attorney at the
Goldwater Institute and his co-counsel in
Massachusetts are Dan Winslow and Ben Robbins of the
New England Legal Foundation....
Massachusetts Fiscal Alliance
Monday, August 22, 2022
News Release
Taxpayer Organizations United
and Prepared to Go to Court to
Protect the Will of the Voters and Rebate Taxpayers
Billions of Dollars
Letter from the Goldwater Institute / New England
Legal Foundation
to State Auditor Suzanne Bump
August 22, 2022
CLICK HERE
Massachusetts taxpayer groups say they’re ready to
sue within a month if the state fails to make good
on a 1986 tax revenue cap law that could require
almost $3 billion in excess funds to be returned to
nearly 5 million taxpayers.
In a
virtual news conference Monday hosted by the
conservative-leaning Massachusetts Fiscal Alliance,
several tax and legal groups said they’re poised to
take state Auditor Suzanne Bump to court on Sept.
21, the day after she’s set to announce whether
state tax revenues exceeded the threshold under
Chapter 62F....
“This
could arguably be the biggest benefit for the people
of Massachusetts,” Paul Craney, spokesman for the
Massachusetts Fiscal Alliance, said Monday. Craney
added that the lawmakers’ $1 billion tax relief
“didn’t cross the finish line, so providing relief
in early winter would be well received by the
taxpayers of Massachusetts.”
Chip
Ford, executive director of Citizens for
Limited Taxation, argued that the sooner
taxpayers are reimbursed, the better.
“With this
legislature, anything’s possible. They could drag
this out forever," he said.
Boston
Business Journal
Monday, August 22, 2022
Taxpayer groups braced to sue if
Massachusetts doesn’t follow refund law
Should
Beacon Hill officials try to duck the tax relief
requirements of Chapter 62F over the next month, at
least two groups of taxpayers, newly including one
supported by major right-leaning groups like
Citizens for Limited Taxation, have organized
themselves to be prepared to ask the state's court
system to step in.
"The
taxpayers have lawyered up," Dan Winslow, a former
judge, Romney administration official and state
representative who now leads the New England Legal
Foundation, said Monday.
A 1986
ballot question initiated by Citizens for Limited
Taxation and its subsequent law, Chapter 62F,
created an annual state tax revenue growth limit
based on the level of growth in total wages and
salaries of Massachusetts citizens. If the state
collects more than the allowed amount of tax revenue
in any one fiscal year, the law says that the
overage is to be returned to taxpayers. The
late-July revelation that 62F could eat up some of
the state's $5-plus billion surplus from fiscal 2022
derailed the Legislature's own tax relief plan and a
massive economic development bill....
Republican
auditor candidate Anthony Amore announced on Aug. 4
that he had lined up at least 24 taxpayers "who
stand ready to file a petition with the state's
highest court should Auditor Suzanne Bump fail to
act with urgency in certifying billions of dollars
in tax rebates under the state's Chapter 62F law."
On Monday,
Amore announced that former U.S. attorney Michael
Sullivan will provide legal representation to his
taxpayer petition effort....
The latest
group of more than 24 individuals lined up as
plaintiffs includes people from each Massachusetts
county and is made up of representatives of Citizens
for Limited Taxation, Mass Fiscal, Beacon Hill
Institute, the local chapter of the National
Federation of Independent Businesses, and the Mass.
High Technology Council....
Chip
Ford, executive director of Citizens for
Limited Taxation, said Monday that the
difference between Amore's effort and the one he is
involved with "is [that] ours is comprised of the
original supporters, the original organizations who
went to the ballot in 1986, put it on the ballot,
ran a campaign, and won the surtax repeal and the
tax cap. And that's Citizens for Limited Taxation,
my organization, and the Mass. High Tech Council."
Paul
Craney, a spokesman for Mass Fiscal, said the group
wanted to hold its press conference Monday because
they are about one month out from when they would
expect to file a lawsuit, if necessary.
Winslow
said his organization is particularly interested in
exploring the idea that the relief afforded by
Chapter 62F "could already be a vested property
right in the hands of the taxpayers to which they're
entitled" regardless of any attempts to amend the
law.
"There's a
significant question that this actually may already
be a done deal as a matter of law," he said. Winslow
added later, "Basically, what remains at this point
is what we call a ministerial act. It's simply
almost an automatic kind of a certification because
the close of the fiscal year was June 30 and so the
condition that this statute applies to already
existed as a matter of fact." ...
Ford, who
was part of the 1986 ballot push, said Citizens for
Limited Taxation had to make sure that its
initiative petition did not appropriate funds, or
else it would have been deemed unconstitutional and
wouldn't have made it to the ballot.
"So we
used the term credit. We didn't use it in the
accepted sense that it can only be returned as a tax
credit in future years, though that was the way it
was interpreted in 1987. Nonetheless, our use of
credit was that the taxpayers would receive a
refund," he said.
State
House News Service
Monday, August 22, 2022
Legal Teams Ready To
Defend Tax Relief Law
Three
conservative watchdog organizations are accusing
lawmakers of attempting to subvert a rare $3 billion
tax refund legally mandated this year at a press
event Monday, saying taxpayers are ready to take the
issue to court.
“The tax
cap has been on the books 36 years,” said Chip
Ford, executive director of Citizens for
Limited Taxation. “It’s been triggered. And now
it’s time for the tax rebate.” ...
But,
representatives from Massachusetts Fiscal Alliance,
the Fiscal Alliance Foundation, Citizens for Limited
Taxation and their legal partners said, they’re
concerned the government will stall or repeal the
requirement....
Speakers
also noted Gov. Charlie Baker has suggested the
money may be distributed as checks rather than tax
credits, saying they would support the relief in
either form.
The
Boston Herald
Monday, August 22, 2022
Watchdog groups argue $3B in tax
relief is under threat in Massachusetts
State
Auditor Suzanne Bump on Monday strongly denied
suggestions that she was under any pressure to delay
calculating how much money should be returned to
taxpayers under the tax cap passed by voters in
1986.
“This is
not and it never has been a political process,” she
said in a telephone interview. “This is a matter of
financial accounting and the wording of the law. No
one is pressuring any office to do anything.”
Bump was
responding to a letter sent on Monday to her office
by the New England Legal Foundation and the
Goldwater Institute. The letter threatened a lawsuit
if Bump fails to carry out her duties under the law
to calculate how much money should be returned to
taxpayers under the tax cap.
“We’re
aware that the auditor is receiving significant
political pressure to delay the certification with
the thought that the Legislature would repeal the
statute when they come back into session,” said Dan
Winslow, president of the New England Legal
Foundation. “There’s even talk of possibly having
the Legislature come into session now.” ...
Winslow’s
organization is working closely with the drafters of
the original tax cap law – Citizens for Limited
Taxation and the Massachusetts High Technology
Council. The law was approved by voters in 1986.
While the
groups don’t want anyone messing with the tax cap
law, they indicated they have no problem if the
Baker administration changes the regulations
governing how the money is returned if the net
result is that the money is returned to taxpayers
more quickly.
Gov.
Charlie Baker has said he hopes to return the money
via rebate checks to taxpayers in late November or
early December, before he leaves office. Under
existing regulations, the money would be returned
next year in the form of a credit on 2022 tax
returns.
Winslow
said he wouldn’t object to how and when the money is
returned as long as it is returned in some fashion.
“As long as the law is being followed, that’s our
interest,” he said.
Chip
Ford of Citizens for Limited Taxation
said he approves of the governor’s efforts to speed
up the return of the money.
“A bird in
the hand is better than two in the bush,” he said.
“With this Legislature, anything is possible. They
could drag this out forever so the sooner the
taxpayers are fully reimbursed the better.”
CommonWealth Magazine
Monday, August 22, 2022
Bump dismisses claim
of tax cap pressure on her office
Escalating
their pressure on Bump earlier Monday, lawyers
supporting the coalition of plaintiffs sent her
office a letter recapping the parameters of the tax
cap law — enacted through a 1986 ballot question to
voters — known as Chapter 62F.
“We trust
that your office will conduct that review process
fairly, accurately, and according to the statutory
deadline, to ensure that Massachusetts taxpayers
receive the tax relief to which they are entitled
under chapter 62F,” the letter to Bump from the
Goldwater Institute and the New England Legal
Foundation states.
But the
firms also outlined their own authority to bring a
lawsuit before the Supreme Judicial Court or
Superior Court to enforce the tax cap law, which has
only been triggered once before in 1987.
“If such
an action is necessary and successful, the plaintiff
taxpayers can seek the tax credits to which they are
entitled under the statute, as well as an award of
reasonable attorneys’ fees and other costs incurred
for bringing suit ...” the letter continues. “We
hope and expect that state officials will comply
with the law and provide greatly needed tax relief
to its citizens. Should it become clear, however,
that Massachusetts officials seek to evade the plain
requirements of chapter 62F, we will uphold the will
of Massachusetts voters by seeking to enforce these
critically important, and statutorily guaranteed,
fiscal safeguards.
The
plaintiffs on Monday would not delineate how likely
it is that Bump will sidestep the tax cap law. Bump
herself, in a statement to MassLive, emphasized
Monday her office’s report will be published on or
before Sept. 20.
Daniel
Winslow, president of the New England Legal
Foundation, expressed worry that the Massachusetts
Legislature may repeal Chapter 62F if they return to
session to finalize a nearly $4 billion economic
development and tax relief bill that failed to
emerge from closed-door negotiations during the end
of formal lawmaking earlier this month.
The
Springfield Republican
Monday, August 22, 2022
Tax relief: Massachusetts
officials face threat of lawsuit
if they don’t comply with state cap tax law
returning excess revenues to Bay Staters
The
Electoral College caught Hillary Clinton off-guard
in 2016. In 2022, it’s the Democrats in charge of
the Massachusetts statehouse who have found
themselves caught flat-footed. What has surprised
leading politicians on Beacon Hill this year is a
state spending cap enacted in 1986.
Governor
Charlie Baker (R) estimates that the 36-year-old
spending cap, which hasn’t come into play since
1987, could result in approximately $3 billion being
refunded to taxpayers. The revelation in late July
that the spending cap would likely be hit prompted
leadership in the Massachusetts Legislature to
shelve a host of temporary and permanent tax cuts
they had planned to pass before adjourning this
summer. Governor Baker asserts that the commonwealth
could afford both the tax relief package tabled by
lawmakers, as well as the taxpayer refunds mandated
by the spending cap.
Many have
pointed to this potential multi-billion dollar
taxpayer refund as another example of how Barbara
Anderson, the longtime executive director of
Citizens for Limited Taxation (CLT) who passed
away in 2016, left behind a legacy whose impact will
continue to be felt long past her time on Earth.
BOSTON:
Executive director of the Citizens for Limited
Taxation Barbara Anderson sits at her desk in their
office
in Boston on July 2, 1981. (Photo by Ly Y/The Boston
Globe via Getty Images)
“She's the
reason property tax increases are capped at 2.5% of
fair market value and the state's income tax was
rolled back from 5.85%,” WBUR-Boston reported in the
days following Anderson’s passing. Six years later,
Anderson’s work is poised to once again benefit
Massachusetts residents, saving them billions of
dollars at a time when many can use the extra cash
to deal with the highest inflation since 62F was
enacted.
“I'm sure
Barbara Anderson is up there looking down on us with
a grin pumping her fist in the heavens,” Chip
Ford, executive director of CLT, said of
Anderson’s legacy. Paul Craney, spokesman for the
Massachusetts Fiscal Alliance, says that Anderson’s
legacy and the organization she left behind “are so
strong that they are still providing protections to
Massachusetts taxpayers four decades on.” ...
Some are
concerned that unless legal action is taken, the
state auditor could find an excuse for why the
surplus money should not be refunded to taxpayers in
accordance with state law. If that doesn’t happen,
legislators could still act to either block or
reduce the size of refunds due under 62F. Although
Governor Baker estimates as much as $3 billion could
be refunded to taxpayers, a final determination on
the refund and its size won’t come for a few more
weeks.
Forbes
Magazine
Friday, August 19, 2022
Six Years After Her Passing,
One Woman’s Life’s Work Continues To Save Taxpayers
Billions
By Patrick Gleason
House
Speaker Ron Mariano raised concerns on Tuesday about
whether the state can afford a $3 billion tax cap
giveback and the $3.5 billion in spending contained
in the economic development bill, which stalled at
the end of the legislative session.
Gov.
Charlie Baker and Senate President Karen Spilka say
the state can afford both, but Mariano is not so
sure.
“If we
continue to have robust revenues, then we can go
ahead and fill all the needs that have been
identified,” he said at a press scrum outside his
office. “But if the economy slows down, which it
could, and we don’t get the revenues that we have
been getting, we may be wise to hold back on some of
these things, save some of the ARPA money that was
committed in this bill.”
The
economic development bill provides funding for a lot
of key priorities and it also includes a $500
million tax relief package and $500 million worth of
$250 payments to most taxpayers.
The bill
passed unanimously in both branches, but it stalled
at the end of the legislative session amid concerns
about the triggering of a 1986 law called 62F that
caps how much tax revenue the state can take in each
year. The law hasn’t been triggered in 35 years, but
the Baker administration estimates the tax cap could
send $3 billion back to taxpayers later this year.
Mariano
said he would like more specificity about the size
of the tax cap giveback and how that money will be
returned to taxpayers.
The 62F
law authorizes the state auditor to certify the size
of the giveback next month and it requires the money
to go back as a tax credit on 2022 tax returns,
although Gov. Charlie Baker is moving to change that
process so refund checks could be mailed out later
this fall before he leaves office....
[Senate
President Karen] Spilka said she wouldn’t be
surprised if the governor proposed funding for some
of the provisions in the economic development bill
in a separate supplemental budget.
But she
acknowledged that the House would need to go along
to get anything done, and it doesn’t seem like
Mariano is ready to do that yet. The speaker said he
wants to see how the 62F money plays out and how
state tax revenues hold up.
“One of
the reasons we have this surplus is because we have
been fiscally prudent and very protective of how we
spend our money,” Mariano said.
CommonWealth Magazine
Tuesday, August 16, 2022
Mariano tapping brakes on
economic development bill
Speaker questions whether state can afford it and
tax cap giveback
In the
extended back-and-forth over the economic
development and tax relief bill stuck in legislative
purgatory, Senate President Karen Spilka has
repeatedly said her chamber wants to act now but
can't without the House doing so first. But on
Tuesday, she gave voice to the possibility that the
Senate could deploy procedural tactics to bring
something to the Senate floor without the House
acting first.
Any
legislation deemed a "money bill" is required by the
Massachusetts Constitution to originate in the
House, meaning that the Senate cannot introduce a
bill that would either increase or decrease the
overall amount of state tax revenue unless the House
has already processed it.
Asked
Tuesday if the Senate Ways and Means Committee had
possession of a "money bill" that it could use as a
vehicle to go around the House and bring the stalled
tax relief plan or other measures of the economic
development bill onto the Senate floor, Spilka made
clear that it was not her preferred course of
action. But she also did not shoot down the
suggestion.
"Possibly,
but if there's no action from the House, it may not
be helpful or productive," Spilka, a former chair of
the Senate Ways and Means Committee, said Tuesday
when asked if the idea was a possibility. She did
not say whether the committee has any such bill in
its possession. "I still think that the best route
is for us to be working together with the
administration. And I am very hopeful about that."
Spilka and
House Speaker Ronald Mariano remain at loggerheads
over whether to move ahead with their agreed-to $1
billion tax rebate and reform plan in light of the
late July realization that the 1986 tax relief law
known as Chapter 62F might require the state to
return about $3 billion to taxpayers.
State
House News Service
Wednesday, August 17, 2022
Senate Acting First on Tax
Bill Not Preferred, But Not Impossible
Lawmakers
love to deflect questions about conference committee
talks by saying their rules require them to keep the
negotiations private among the three representative
and three senators tasked with finding a compromise.
But no one is making any bones about the fact that
the conference committee still negotiating an
economic development bill has looped in an informal
seventh member: Gov. Charlie Baker.
The
Legislature ended its formal sessions for the year
on Aug. 1 without coming to agreement on a
compromise version of a $4 billion economic
development package that was to include $1 billion
in tax rebates and reforms. The economic development
bills (H 5034 / S 3030) are pending before a
six-person, House-Senate conference committee that
meets only in private, but Baker said Thursday on
GBH's Boston Public Radio that his office is also
involved in the talks.
"We've had
conversations with both the House and the Senate
about this and are trying to figure out some ground
everybody can stand on," he said. "I got asked this
the other day about am I optimistic that this will
still happen? And actually, I am kind of optimistic.
I mean, I don't know exactly what it will look like,
but I do believe that there will be a piece of
legislation that gets to my desk that has a lot of
the elements of this, and I really do believe that."
Baker said
he sees "a couple of possibilities" for getting some
form of an economic development bill done, but did
not say how he thinks it should get done. Senate
President Karen Spilka alluded to Baker's
involvement in the economic development talks
earlier this week when she suggested that Baker
might file a supplemental budget that includes some
of the spending called for in the stalled jobs
bill....
While
Baker and Spilka would like to see the Legislature
pass some form of tax relief now, House Speaker
Ronald Mariano said this week he is "hesitant" to
commit to all of the spending (including the tax
relief) in the economic development bills without
first knowing just how much of its excess tax
revenue the state may have to return to taxpayers
under a 1980s voter law known as Chapter 62F.
State
House News Service
Thursday, August 18, 2022
Baker Figures
Prominently in Talks About Legislature’s Return
Enacting Two-Thirds of Eco Dev Bill "Fine With Me,"
Guv Says
Gov.
Charlie Baker apparently has not given up hope that
some version of his tax cut proposal will clear the
Legislature in time for him to sign it before he
leaves office.
“I got
asked this the other day about am I optimistic that
this will still happen and actually, I am kind of
optimistic,” he said. “I mean, I don’t know exactly
what it will look like, but I do believe that there
will be a piece of legislation that gets to my
desk.”
Baker was
making an appearance on GBH’s Boston Public Radio
for an ‘Ask the Governor’ session with hosts Margery
Eagan and Jim Braude.
The
Legislature wrapped its formal sessions this year
after passing a number of landmark pieces of
legislation, but failed to advance a $4 billion
economic development bill which would have sent $250
back to taxpayers and codified several of Baker’s
tax priorities before they ran out of time to act in
formal session.
Also at
issue were the ghost of 1986 and the efforts of the
late Barbara Anderson to control the
legislature’s taxing authority.
A law
passed then, used once after passage but never
since, was triggered by the state’s unexpected boom
in tax revenue last year, potentially sending $3
billion back to taxpayers. Legislators balked at the
potential cost of both occuring at once, with some
claiming Baker had blindsided them with the laws’
requirements.
Baker has
maintained that both tax rebates — the 1986 law and
the Legislature’s plan to send money to low income
taxpayers — are affordable. He stressed again
Thursday the state had the funds to do both.
Further,
Baker pointed out, the law has been on the books and
reported to lawmakers for 35 years.
The
Boston Herald
Thursday, August 18, 2022
Charlie Baker holds out
hope for tax cuts, maintains state can afford it
|
Chip Ford's CLT
Commentary |
After a straight month of
20-hour workdays seven days a week I'm pretty much wiped out so I'll let the
news reports speak for themselves. One important point left
out of all the reports is well worth highlighting. Mike Hruby of New Jobs America, one of the plaintiffs in our lawsuit,
noted the effect of Bidenflation on our tax cap's mandated refund
(watch 21:10 minutes into the
news conference video):
"In a situation
involving ten percent inflation, a payment made promptly is not
going to be degraded in value, but a payment that turns into a
credit on the 2023 tax returns is not going to be due and
payable until 2024, which is nearly two years from now.
Ten percent inflation compounded for two years, you can figure
it out. That's a great degradation on the amount the
taxpayers will receive."
This is another critical
reason for CLT's Tax Cap refund to be expedited, returned to the
taxpayers who made their unnecessary overpayments by the quickest means possible
— as Gov. Baker has recommended.
The"excess revenue" that needs to be returned to taxpayers is piled
up in the state treasury today collecting interest.
Who knows for how long before it too is spent, "invested"? Refund payments
can and should be sent out in November-December, as Gov. Baker
recommended, to every taxpayer who
filed a 2021 state tax return in 2022 and paid that "excess."
|
 |
 |
|
Chip Ford
Executive Director |
|
|
|
Massachusetts Fiscal
Alliance
Monday, August 22, 2022
News Release
Taxpayer Organizations United and Prepared to Go to Court to
Protect the Will of the Voters and Rebate Taxpayers Billions
of Dollars
The Massachusetts Fiscal Alliance, the Fiscal Alliance
Foundation, and Citizens for Limited Taxation
announced today that they have partnered with the New
England Legal Foundation and the Goldwater Institute to
prepare to bring suit to enforce Chapter 62F of
Massachusetts law, should such action be necessary. Jon
Riches is the lead attorney at the Goldwater Institute and
his co-counsel in Massachusetts are Dan Winslow and Ben
Robbins of the New England Legal Foundation.
The voters of the Commonwealth enacted Chapter 62F in 1986
to implement hard limits on the amount Massachusetts can tax
its residents and on government spending. If revenues exceed
legally applicable limits, the state “shall” issue “tax
credits equal to the total amount of such excess” to all
Massachusetts taxpayers. The revenue growth limit was
spearheaded by Citizens for Limited Taxation and the
Massachusetts High Technology Council. Chapter 62F permits
24 named taxpayers in the Commonwealth to bring an action in
the Supreme Judicial Court or Superior Court to enforce the
provisions of that law. The State Auditor must comply by her
statutory deadline of September 20 to certify the Department
of Revenue’s numbers.
Earlier today, the Goldwater Institute and the New England
Legal Foundation sent a letter on behalf of Massachusetts
taxpayers to Auditor Suzanne Bump. While we expect the
Auditor to continue to comply with the certification
requirements, taxpayers have promised to uphold the will of
Massachusetts voters by seeking to enforce these critically
important and statutorily guaranteed fiscal safeguards,
demanding the government follow the law. Should it become
clear that Massachusetts officials are seeking to sidestep
the plainly laid out requirements of Chapter 62F, taxpayers
have promised to uphold the will of Massachusetts voters by
seeking to enforce these critically important and
statutorily guaranteed fiscal safeguards.
“This is a once-in-a-generation opportunity to make sure
Massachusetts taxpayers get back billions of dollars of
their hard-earned money. We will do everything in our power
to make sure this happens, and to hold politicians
accountable if they try to evade this law,” said Paul Diego
Craney, spokesman for the Massachusetts Fiscal Alliance.
“Some State House politicians would like nothing more right
now than for us to fail to ease their insatiable appetite to
spend, but we are committed and prepared to bring them to
court if they think they can delay this process for even one
minute.”
“In 1986 Citizens for Limited Taxation put forth this ballot
question with the recognition that Massachusetts taxpayers
would one day need this law to kick into action. That it
took this long isn’t a bug but a design feature. I’m proud
to partner with CLT’s allies and colleagues to ensure that
everything is done to protect the voters’ mandate and help
protect taxpayers from an insatiable state government,”
added Chip Ford, Executive Director of Citizens
for Limited Taxation.
“The tax limit is a prudent fiscal policy safeguard that
helps prevent over commitments of extraordinary revenue by
the Legislature during periods of strong private sector
performance,” said Mass. High Tech Council president Chris
Anderson.
“NELF’s mission includes standing for the rule of law,” said
Daniel B. Winslow, President of the New England Legal
Foundation. “Now, more than ever, we must ensure that
citizens and public servants alike respect the rule of law.
We are hopeful the Auditor will set an example by upholding
her oath of office.”
“Massachusetts voters passed Chapter 62F for a reason: to
protect working families and individuals from runaway
tax-and-spend practices that lead to financial turmoil,”
said Jon Riches, Vice President for Litigation at the
Goldwater Institute. “As Americans come to terms with
skyrocketing inflation, it’s imperative that the
Massachusetts government follow the law. If it refuses to do
so, we won’t hesitate to bring necessary action to protect
Massachusetts taxpayers.”
“This return of taxpayer money will become seed money for
job growth and self-employment,” said Mike Hruby, President
of New Jobs for Massachusetts. “Many will pay down household
debt with it, some will invest it, and the most determined
will use it to start a new business with a flexible schedule
and greater income potential. Returning taxpayer money will
benefit every resident.”
Letter from
the Goldwater Institute / New England Legal Foundation
to State Auditor Suzanne Bump
August 22, 2022
CLICK
HERE
Boston Business
Journal
Monday, August 22, 2022
Taxpayer groups braced to sue if Massachusetts doesn’t
follow refund law
By Benjamin Kail
Massachusetts taxpayer groups say they’re ready to sue
within a month if the state fails to make good on a 1986 tax
revenue cap law that could require almost $3 billion in
excess funds to be returned to nearly 5 million taxpayers.
In a virtual news conference Monday hosted by the
conservative-leaning Massachusetts Fiscal Alliance, several
tax and legal groups said they’re poised to take state
Auditor Suzanne Bump to court on Sept. 21, the day after
she’s set to announce whether state tax revenues exceeded
the threshold under Chapter 62F. The law, triggered for the
first time in decades by the state’s fiscal 2022 surplus,
was approved in a referendum in 1986 and required that
revenue exceeding growth in wages and salaries must make its
way to taxpayers’ pockets.
In a statement, Bump told the Business Journal Monday that
her office will make a determination on whether net state
tax revenues “exceeded allowable state tax revenues in
fiscal year 2022,” and release the determination on or
before Sept. 20. She shrugged off the talk of lawsuits,
saying the law is cut-and-dry and will be followed.
In late July, Gov. Charlie Baker’s office estimated that
roughly 7% of the income taxes residents paid in 2021 should
be returned, State House News Service reported. For
taxpayers who earn $75,000, that means about $250 — which is
about the same amount that Baker and lawmakers had attempted
to deliver in the form of rebate checks to middle-income
taxpayers as part of a sweeping economic development bill as
they closed out the legislative session. However, the
re-emergence of the 1986 law pushed that bill into a state
of limbo.
The Goldwater Institute, a public policy and research group,
and New England Legal Foundation, a nonprofit public
interest law firm, wrote to Bump Monday, threatening to
bring action to Superior Court or the Supreme Judicial
Court. The groups argued that 62F represented a
voter-mandated “hard limit on the amount Massachusetts can
tax its residents and a hard limit on government spending.
We hope and expect that state officials will comply with the
law and provide greatly needed tax relief to its citizens.”
“This could arguably be the biggest benefit for the people
of Massachusetts,” Paul Craney, spokesman for the
Massachusetts Fiscal Alliance, said Monday. Craney added
that the lawmakers’ $1 billion tax relief “didn’t cross the
finish line, so providing relief in early winter would be
well received by the taxpayers of Massachusetts.”
Chip Ford, executive director of Citizens for Limited
Taxation, argued that the sooner taxpayers are reimbursed,
the better.
“With this legislature, anything’s possible. They could drag
this out forever," he said.
Dan Winslow, NELF’s president, suggested Monday that Bump
was under “political pressure to delay the certification
with the thought that the legislature would repeal the
statute when they come back into session.”
Bump told the Business Journal that her role is “clearly
defined and we will comply with all statutory requirements
as we have every year.”
“Despite the histrionics of some parties, this determination
is not a political one,” she said. “It is based on
verifiable numbers and the law.”
State House News
Service
Monday, August 22, 2022
Legal Teams Ready To Defend Tax Relief Law
62F Supporters Working With Former GOP Reps. Winslow,
Sullivan
By Colin A. Young
Should Beacon Hill officials try to duck the tax relief
requirements of Chapter 62F over the next month, at least
two groups of taxpayers, newly including one supported by
major right-leaning groups like Citizens for Limited
Taxation, have organized themselves to be prepared to ask
the state's court system to step in.
"The taxpayers have lawyered up," Dan Winslow, a former
judge, Romney administration official and state
representative who now leads the New England Legal
Foundation, said Monday.
A 1986 ballot question initiated by Citizens for Limited
Taxation and its subsequent law, Chapter 62F, created an
annual state tax revenue growth limit based on the level of
growth in total wages and salaries of Massachusetts
citizens. If the state collects more than the allowed amount
of tax revenue in any one fiscal year, the law says that the
overage is to be returned to taxpayers. The late-July
revelation that 62F could eat up some of the state's $5-plus
billion surplus from fiscal 2022 derailed the Legislature's
own tax relief plan and a massive economic development bill.
The law allows a group of at least 24 "taxable inhabitants"
of Massachusetts to petition the Supreme Judicial Court or
Superior Court to enforce the provisions of Chapter 62F, and
at least two parallel efforts are afoot on that front in the
event that officials attempt to evade the requirements of
the law.
"We're aware that the auditor is receiving significant
political pressure to delay the certification with the
thought that the Legislature would repeal the statute when
they come back into session at the top of the new session
and there's even talk about possibly having the Legislature
come into session now to repeal the law as part of another
package," Winslow said during a press conference Monday to
announce that the Massachusetts Fiscal Alliance, the Fiscal
Alliance Foundation and Citizens for Limited Taxation had
partnered with the New England Legal Foundation and the
Goldwater Institute to prepare to bring suit to enforce
Chapter 62F.
The commissioner of revenue is required by Sept. 1 to send
the state auditor a report of the net state tax revenue and
the allowable state tax revenue for the fiscal year that
ended June 30. By the third Tuesday of September -- Sept. 20
this year -- the auditor must "independently determine"
whether tax collections exceeded that allowable amount and
then notify the executive branch, House and Senate of the
amount of the overage. The auditor's determination "shall be
conclusive," the law states.
There has been no indication from Auditor Suzanne Bump that
she intends to depart from the required timeline and her
office has said it cannot prepare its report until it
receives the necessary information from DOR. But lawmakers,
chiefly House Speaker Ronald Mariano, have suggested that
they might try to tinker with Chapter 62F in some fashion.
Mariano also, however, has called 62F "the law of the land
and it's going to happen."
Republican auditor candidate Anthony Amore announced on Aug.
4 that he had lined up at least 24 taxpayers "who stand
ready to file a petition with the state's highest court
should Auditor Suzanne Bump fail to act with urgency in
certifying billions of dollars in tax rebates under the
state's Chapter 62F law."
On Monday, Amore announced that former U.S. attorney Michael
Sullivan will provide legal representation to his taxpayer
petition effort. Sullivan and Winslow ran against each other
(and both came up short against Gabriel Gomez) in the 2013
Republican primary for the U.S. Senate seat that John Kerry
resigned.
"With record inflation straining the budgets of working
families, I share Anthony's belief that our state government
must respect the decision of the voters across the
Commonwealth to quickly get tax rebate checks in the hands
of residents," Sullivan, the father of Rep. Alyson Sullivan,
said. "If the State Auditor does not do her job and move
swiftly and accurately through this certification process,
our coalition will file an enforcement action with the
Supreme Judicial Court."
The latest group of more than 24 individuals lined up as
plaintiffs includes people from each Massachusetts county
and is made up of representatives of Citizens for Limited
Taxation, Mass Fiscal, Beacon Hill Institute, the local
chapter of the National Federation of Independent
Businesses, and the Mass. High Technology Council.
"While we expect the Auditor to continue to comply with the
certification requirements, taxpayers have promised to
uphold the will of Massachusetts voters by seeking to
enforce these critically important and statutorily
guaranteed fiscal safeguards, demanding the government
follow the law," MassFiscal said in a press release. "Should
it become clear that Massachusetts officials are seeking to
sidestep the plainly laid out requirements of Chapter 62F,
taxpayers have promised to uphold the will of Massachusetts
voters by seeking to enforce these critically important and
statutorily guaranteed fiscal safeguards."
Chip Ford, executive director of Citizens for Limited
Taxation, said Monday that the difference between Amore's
effort and the one he is involved with "is [that] ours is
comprised of the original supporters, the original
organizations who went to the ballot in 1986, put it on the
ballot, ran a campaign, and won the surtax repeal and the
tax cap. And that's Citizens for Limited Taxation, my
organization, and the Mass. High Tech Council."
Paul Craney, a spokesman for Mass Fiscal, said the group
wanted to hold its press conference Monday because they are
about one month out from when they would expect to file a
lawsuit, if necessary.
Winslow said his organization is particularly interested in
exploring the idea that the relief afforded by Chapter 62F
"could already be a vested property right in the hands of
the taxpayers to which they're entitled" regardless of any
attempts to amend the law.
"There's a significant question that this actually may
already be a done deal as a matter of law," he said. Winslow
added later, "Basically, what remains at this point is what
we call a ministerial act. It's simply almost an automatic
kind of a certification because the close of the fiscal year
was June 30 and so the condition that this statute applies
to already existed as a matter of fact."
Chapter 62F also requires that the auditor's determination
that net state tax revenue exceed the allowable amount
"shall result in a credit equal to the total amount of such
excess" and that the "credit shall be applied to the then
current personal income tax liability of all taxpayers on a
proportional basis to the personal income tax liability
incurred by all taxpayers in the immediately preceding
taxable year."
But that may not be how things play out. The Baker
administration has been quietly working behind the scenes to
change the regulations around Chapter 62F since this spring
and his budget chief said when the 36-year-old law's impact
on the fiscal year 2022 surplus came to light that he was
already "looking at what's the quickest and most efficient
way to get that money back to the taxpayers." Baker said two
weeks ago that he "expect[s] that people will be receiving
their refund sometime between the end of November and the
beginning of December," which wouldn't line up with a credit
applied to personal income tax liability but would mean the
money would go out before he leaves office.
During a press conference Monday, representatives of some of
the groups prepared to sue to make sure that Chapter 62F is
followed to the letter of the law did not express strong
opinions one way or another as to how the money is returned
to taxpayers and even suggested they would be open to some
Legislative alterations to 62F.
"If the law were to change to give money back directly
rather than a credit for future taxes, you know, as long as
the law is being followed, that's our interest," Winslow
said. He then added, "We care that the law on the books is
followed ... if the law is amended by the Legislature to
change the form of the payment, you know, that's the law."
Ford, who was part of the 1986 ballot push, said Citizens
for Limited Taxation had to make sure that its initiative
petition did not appropriate funds, or else it would have
been deemed unconstitutional and wouldn't have made it to
the ballot.
"So we used the term credit. We didn't use it in the
accepted sense that it can only be returned as a tax credit
in future years, though that was the way it was interpreted
in 1987. Nonetheless, our use of credit was that the
taxpayers would receive a refund," he said.
The only time the excess revenue cap was hit, in fiscal
1987, the $29.22 million in credits was made available to
taxpayers through the addition of a line on the 1987
Massachusetts individual income tax return "upon which each
individual taxpayer could insert their individually
calculated share of the $29,221,675 credit," the auditor's
office said.
DOR this spring began the process of repealing the
regulation that governs how a taxpayer obtains a credit
toward personal income tax liability under Chapter 62F with
the agency saying that it is "obsolete" because no credit
had been required since 1987.
The Executive Office of Administration and Finance said
Monday that the regulation had not yet been officially
rescinded. A Baker administration official previously said
that DOR will "issue relevant guidance or regulations for
this year's implementation" if Chapter 62F is triggered.
The Boston
Herald
Monday, August 22, 2022
Watchdog groups argue $3B in tax relief is under threat in
Massachusetts
Auditor Bump said she will make her determination on the tax
cap based on numbers and the law
By Grace Zokovitch
Three conservative watchdog organizations are accusing
lawmakers of attempting to subvert a rare $3 billion tax
refund legally mandated this year at a press event Monday,
saying taxpayers are ready to take the issue to court.
“The tax cap has been on the books 36 years,” said Chip
Ford, executive director of Citizens for Limited Taxation.
“It’s been triggered. And now it’s time for the tax rebate.”
The law in question, Chapter 62F, establishes limits on
Massachusetts taxation and government spending. It has been
triggered just two times, in 1987 and this year.
When triggered, it requires the distribution of “tax credits
equal to the total amount of such excess” to taxpayers in
the state. This year, with Massachusetts’s over $5 billion
revenue surplus, the rebate would equal around $3 billion.
But, representatives from Massachusetts Fiscal Alliance, the
Fiscal Alliance Foundation, Citizens for Limited Taxation
and their legal partners said, they’re concerned the
government will stall or repeal the requirement.
The organizations sent a letter to State Auditor Suzanne
Bump on Monday notifying the official they are ready to file
a lawsuit if the overage is not certified by the statutory
deadline of Sept. 20. The auditor is required to
independently determine if tax collections exceed the law’s
cap and notify other branches so the process may proceed.
Bump has not indicated an intent to ignore the law.
“Despite the histrionics of some parties, this determination
is not a political one,” Bump wrote in response to the
organizations’ message Monday. “It is based on verifiable
numbers and the law.”
New England Legal Foundation President Dan Winslow alleged:
“the auditor is receiving significant political pressure to
delay the certification” in order to give the Legislature
time to repeal the law, without giving specifics.
“Our hope of course is the public officials involved will
carry out their oath of office and follow the law as it’s
written,” said Winslow. “But if that doesn’t happen, we’re
prepared to go forward with a lawsuit to compel compliance.”
If the auditor deadline is missed, the provisions allow 24
taxpayers to petition the Supreme Judicial Court or Superior
Court to enforce the law. Both the organizations and
Republican auditor candidate Anthony Amore, who made a
similar announcement on Aug. 4, have said they have
residents ready to file the petition.
Speakers also noted Gov. Charlie Baker has suggested the
money may be distributed as checks rather than tax credits,
saying they would support the relief in either form.
CommonWealth
Magazine
Monday, August 22, 2022
Bump dismisses claim of tax cap pressure on her office
‘This is not and never has been a political process,’ she
says
By Bruce Mohl
State Auditor Suzanne Bump on Monday strongly denied
suggestions that she was under any pressure to delay
calculating how much money should be returned to taxpayers
under the tax cap passed by voters in 1986.
“This is not and it never has been a political process,” she
said in a telephone interview. “This is a matter of
financial accounting and the wording of the law. No one is
pressuring any office to do anything.”
Bump was responding to a letter sent on Monday to her office
by the New England Legal Foundation and the Goldwater
Institute. The letter threatened a lawsuit if Bump fails to
carry out her duties under the law to calculate how much
money should be returned to taxpayers under the tax cap.
“We’re aware that the auditor is receiving significant
political pressure to delay the certification with the
thought that the Legislature would repeal the statute when
they come back into session,” said Dan Winslow, president of
the New England Legal Foundation. “There’s even talk of
possibly having the Legislature come into session now.”
Bump said her office is handling the tax cap the way it has
every other year. She said the Legislature isn’t pressuring
her office and the office will calculate how much money
should go back to taxpayers in September.
The big difference with the calculation this year is that
the tax cap, which has not been triggered since 1987, is
expected to return roughly $3 billion to taxpayers.
Winslow said he believes the $3 billion may already have
vested with taxpayers, meaning that, legally, any future
change in the tax cap law would not affect the return of the
money.
Winslow’s organization is working closely with the drafters
of the original tax cap law – Citizens for Limited Taxation
and the Massachusetts High Technology Council. The law was
approved by voters in 1986.
While the groups don’t want anyone messing with the tax cap
law, they indicated they have no problem if the Baker
administration changes the regulations governing how the
money is returned if the net result is that the money is
returned to taxpayers more quickly.
Gov. Charlie Baker has said he hopes to return the money via
rebate checks to taxpayers in late November or early
December, before he leaves office. Under existing
regulations, the money would be returned next year in the
form of a credit on 2022 tax returns.
Winslow said he wouldn’t object to how and when the money is
returned as long as it is returned in some fashion. “As long
as the law is being followed, that’s our interest,” he said.
Chip Ford of Citizens for Limited Taxation said he approves
of the governor’s efforts to speed up the return of the
money.
“A bird in the hand is better than two in the bush,” he
said. “With this Legislature, anything is possible. They
could drag this out forever so the sooner the taxpayers are
fully reimbursed the better.”
The
Springfield Republican
Monday, August 22, 2022
Tax relief: Massachusetts officials face threat of lawsuit
if they don’t comply with state cap tax law returning excess
revenues to Bay Staters
By Alison Kuznitz
More than two dozen potential plaintiffs across the
commonwealth, including the conservative-leaning
Massachusetts Fiscal Alliance, claim they are ready to sue
state officials if they refuse to comply with a 1980s law
poised to return some $3 billion in excess tax revenues to
cash-strapped Bay Staters this fall.
The tax groups, in partnership with law firms, intend to
file the lawsuit on Sept. 21 if needed — should state
Auditor Suzanne Bump not abide by her statutory requirement
the day prior, with her office due to release a report on
whether a to-be-determined state tax revenue threshold has
been eclipsed.
If the threshold is exceeded, pending calculations tied to
annual wage and salary growth as Massachusetts remains awash
in surplus tax dollars, the state Department of Revenue
would be responsible for distributing tax credits or rebates
to Bay Staters. The Baker administration expects 7% of 2021
income taxes could be returned to residents, translating
into $250 for individuals who earned $75,000.
“This could arguably be the biggest benefit for the people
of Massachusetts — close to $3 billion going back to about
4.7 million taxpayers,” Paul Diego Craney, spokesman for the
Massachusetts Fiscal Alliance, said during a virtual press
conference Monday morning. “Anyone that pays an income tax
will receive a refund, so we’re really happy and honored to
be part of this.”
Escalating their pressure on Bump earlier Monday, lawyers
supporting the coalition of plaintiffs sent her office a
letter recapping the parameters of the tax cap law — enacted
through a 1986 ballot question to voters — known as Chapter
62F.
“We trust that your office will conduct that review process
fairly, accurately, and according to the statutory deadline,
to ensure that Massachusetts taxpayers receive the tax
relief to which they are entitled under chapter 62F,” the
letter to Bump from the Goldwater Institute and the New
England Legal Foundation states.
But the firms also outlined their own authority to bring a
lawsuit before the Supreme Judicial Court or Superior Court
to enforce the tax cap law, which has only been triggered
once before in 1987.
“If such an action is necessary and successful, the
plaintiff taxpayers can seek the tax credits to which they
are entitled under the statute, as well as an award of
reasonable attorneys’ fees and other costs incurred for
bringing suit ...” the letter continues. “We hope and expect
that state officials will comply with the law and provide
greatly needed tax relief to its citizens. Should it become
clear, however, that Massachusetts officials seek to evade
the plain requirements of chapter 62F, we will uphold the
will of Massachusetts voters by seeking to enforce these
critically important, and statutorily guaranteed, fiscal
safeguards.
The plaintiffs on Monday would not delineate how likely it
is that Bump will sidestep the tax cap law. Bump herself, in
a statement to MassLive, emphasized Monday her office’s
report will be published on or before Sept. 20.
Daniel Winslow, president of the New England Legal
Foundation, expressed worry that the Massachusetts
Legislature may repeal Chapter 62F if they return to session
to finalize a nearly $4 billion economic development and tax
relief bill that failed to emerge from closed-door
negotiations during the end of formal lawmaking earlier this
month.
“We’re aware that the auditor is receiving significant
political pressure to delay the certification with the
thought that the Legislature would repeal the statute when
they come back into session at the top of the new session,”
Winslow said as he mulled over another problematic scenario
during the press conference.
Lawmakers had struggled to reconcile how they could afford
their initial $1 billion tax relief plan, including sending
$250 stimulus checks to middle-income residents, on top of
the $3 billion required by the forgotten tax cap law that
came as a shock to Beacon Hill at the end of July.
House Speaker Ron Mariano briefly floated the possibility of
delaying the tax rebates or scrapping Chapter 62F
altogether, though by Aug. 1 he deferred to Gov. Charlie
Baker’s stance and called it “the law of the land.”
Bump’s office has received the letter about potential legal
action tied to 62F, a spokeswoman confirmed to MassLive.
“Despite the histrionics of some parties, this determination
is not a political one,” Bump said in her statement. “It is
based on verifiable numbers and the law. Per MGL c. 62f
section 5, the Auditor’s role is clearly defined and we will
comply with all statutory requirements as we have every
year.”
In a memo to lawmakers on Aug. 5, Bump also gave no
indication the Office of the State Auditor would skirt the
law. The memo, rather, offered a detailed explanation of
what Bump’s pending analysis of state tax revenues would
entail, such as calculating “allowable state tax growth”
under 62F and comparing the net state tax revenue to the
allowable state tax revenue for fiscal 2022.
“OSA is conducting this annual review in accordance with
generally accepted government auditing standards, which
require that we have sufficient, appropriate evidence to
provide a reasonable basis for finding and conclusions ...”
the memo, which Bump shared on Twitter, states. “OSA’s
analysis is overseen by State Auditor Suzanne M. Bump and
four senior CPAs with thirty eight years combined service in
the State Auditor’s Office.”
Monday’s legal challenge comes a week after Anthony Amore, a
Republican candidate for state auditor, announced his own
taxpayer coalition aiming to enforce 62F. Amore’s campaign
expects up to 84 taxpayers — or six individuals from all 14
Massachusetts counties — may join onto his push to pursue a
lawsuit if necessary.
Amore’s campaign on Monday tapped former U.S. Attorney
Michael Sullivan to provide legal representation.
“With record inflation straining the budgets of working
families, I share Anthony’s belief that our state government
must respect the decision of the voters across the
Commonwealth to quickly get tax rebate checks in the hands
of residents,” Sullivan said in a statement. “If the State
Auditor does not do her job and move swiftly and accurately
through this certification process, our coalition will file
an enforcement action with the Supreme Judicial Court.”
Friday, August 19, 2022
Six Years After Her Passing,
One Woman’s Life’s Work Continues To Save Taxpayers Billions
By Patrick Gleason
The Electoral College caught Hillary Clinton off-guard in
2016. In 2022, it’s the Democrats in charge of the
Massachusetts statehouse who have found themselves caught
flat-footed. What has surprised leading politicians on
Beacon Hill this year is a state spending cap enacted in
1986.
Governor Charlie Baker (R) estimates that the 36-year-old
spending cap, which hasn’t come into play since 1987, could
result in approximately $3 billion being refunded to
taxpayers. The revelation in late July that the spending cap
would likely be hit prompted leadership in the Massachusetts
Legislature to shelve a host of temporary and permanent tax
cuts they had planned to pass before adjourning this summer.
Governor Baker asserts that the commonwealth could afford
both the tax relief package tabled by lawmakers, as well as
the taxpayer refunds mandated by the spending cap.
"The tax breaks that are currently pending before the
Legislature are eminently affordable within the context of
the rest of this,” Governor Baker said in early August. “I
mean, you're talking about a tax year this past year in
which tax revenue went up by over 20%, which came on the
heels of a tax revenue increase in the previous year that
went up by 15%…I mean, these are sort of unprecedented
increases in tax revenue, which is in some ways exactly what
this thing was designed (to do), to ensure that people in
Massachusetts participated in that windfall.”
The Massachusetts spending cap is commonly referred to as
62F, after the chapter in which it is found in the state tax
code. 62F stipulates that state revenue collections in
excess of the rate of wage and salary growth must be
refunded to taxpayers. The prospective triggering of 62F
this year was first reported in CommonWealth Magazine in
late July, where it was described as “one of those laws that
has largely faded from memory.”
“It was passed by voters in 1986, in the midst of the
so-called Massachusetts Miracle,” writes CommonWealth’s
Bruce Mohl. “Put forward by Citizens for Limited Taxation
and the Massachusetts High Technology Council, the ballot
question sought to restrict how much tax revenue the state
could take in, limiting the growth in revenues to no more
than the growth in total wages and salaries.”
The state auditor is in charge of reviewing the numbers and
making a determination as to whether and how much money must
be refunded to taxpayers. The refund, if one is due, would
be applied as a credit counting against this year’s income
tax liability. Massachusetts taxpayers are poised to get
back billions of dollars when they do their taxes next year
if the state auditor confirms next month, as Governor Baker
expects, that a refund is owed.
Many have pointed to this potential multi-billion dollar
taxpayer refund as another example of how Barbara Anderson,
the longtime executive director of Citizens for Limited
Taxation (CLT) who passed away in 2016, left behind a legacy
whose impact will continue to be felt long past her time on
Earth.
BOSTON:
Executive director of the Citizens for Limited Taxation
Barbara Anderson sits at her desk
in their office in Boston on July 2, 1981. (Photo by Ly
Y/The Boston Globe via Getty Images)
“She's the reason property tax
increases are capped at 2.5% of fair market value and the
state's income tax was rolled back from 5.85%,” WBUR-Boston
reported in the days following Anderson’s passing. Six years
later, Anderson’s work is poised to once again benefit
Massachusetts residents, saving them billions of dollars at
a time when many can use the extra cash to deal with the
highest inflation since 62F was enacted.
“I'm sure Barbara Anderson is up there looking down on us
with a grin pumping her fist in the heavens,” Chip Ford,
executive director of CLT, said of Anderson’s legacy. Paul
Craney, spokesman for the Massachusetts Fiscal Alliance,
says that Anderson’s legacy and the organization she left
behind “are so strong that they are still providing
protections to Massachusetts taxpayers four decades on.”
While Governor Baker and others are hopeful that 62F will
result in billions going back to taxpayers, it’s still too
early for refund supporters to spike the football. In fact,
there is now concern that leadership in the Massachusetts
House and Senate may take action to prevent the issuance of
taxpayer refunds in accordance with 62F. "Frankly, I often
say rule number one: you have to know all the rules,”
Representative Michael Connolly (D) said of the situation.
“Rule number two: there are no rules.”
“Sure, it’s an option,” Massachusetts House Speaker Ron
Mariano (D) said of the prospect that he and his colleagues
would consider repealing or modifying 62F so as to prevent
taxpayer refunds. “Everything’s on the table. We could undo
the law, we could change it, we could postpone.”
“We haven't gotten to that point to make any decisions yet,”
Senator Michael Rodrigues (D), chairman of the Ways & Means
Committee, said when asked about potential changes to or
repeal of 62F. “Remember, the administration just discovered
and informed us about this…we're still trying to understand,
and working with some outside folks that know the tax codes
even better.”
Some are concerned that unless legal action is taken, the
state auditor could find an excuse for why the surplus money
should not be refunded to taxpayers in accordance with state
law. If that doesn’t happen, legislators could still act to
either block or reduce the size of refunds due under 62F.
Although Governor Baker estimates as much as $3 billion
could be refunded to taxpayers, a final determination on the
refund and its size won’t come for a few more weeks.
“That’s hanging out there with a lot of questions that I’d
like to see answered before we make major, major decisions
about taxes and everything else,” Speaker Mariano said
earlier this week. We’ll find out by mid-September whether
Massachusetts Auditor Suzanne Bump, a lame duck Democrat,
certifies that the tax cap has been hit and how much surplus
revenue must be refunded to taxpayers.
BOSTON -
Barbara Anderson speaks during the Citizens for Limited
Taxation at the Mass. State
House in Boston on Feb. 5, 1981. (Photo by David L. Ryan/The
Boston Globe via Getty Images)
CommonWealth Magazine
Tuesday, August 16, 2022
Mariano tapping brakes on economic development bill
Speaker questions whether state can afford it and tax cap
giveback
By Bruce Mohl
House Speaker Ron Mariano raised concerns on Tuesday about
whether the state can afford a $3 billion tax cap giveback
and the $3.5 billion in spending contained in the economic
development bill, which stalled at the end of the
legislative session.
Gov. Charlie Baker and Senate President Karen Spilka say the
state can afford both, but Mariano is not so sure.
“If we continue to have robust revenues, then we can go
ahead and fill all the needs that have been identified,” he
said at a press scrum outside his office. “But if the
economy slows down, which it could, and we don’t get the
revenues that we have been getting, we may be wise to hold
back on some of these things, save some of the ARPA money
that was committed in this bill.”
The economic development bill provides funding for a lot of
key priorities and it also includes a $500 million tax
relief package and $500 million worth of $250 payments to
most taxpayers.
The bill passed unanimously in both branches, but it stalled
at the end of the legislative session amid concerns about
the triggering of a 1986 law called 62F that caps how much
tax revenue the state can take in each year. The law hasn’t
been triggered in 35 years, but the Baker administration
estimates the tax cap could send $3 billion back to
taxpayers later this year.
Mariano said he would like more specificity about the size
of the tax cap giveback and how that money will be returned
to taxpayers.
“That’s hanging out there with a lot of questions that I’d
like to see answered before we make major, major decisions
about taxes and everything else,” Mariano said.
The 62F law authorizes the state auditor to certify the size
of the giveback next month and it requires the money to go
back as a tax credit on 2022 tax returns, although Gov.
Charlie Baker is moving to change that process so refund
checks could be mailed out later this fall before he leaves
office.
Senate President Karen Spilka said the state can afford both
the tax cap giveback and the economic development bill. The
problem is the Legislature recessed for the year at the end
of July, but Spilka believes lawmakers could pass the
economic development bill in informal sessions where one
lawmaker could prevent legislation from moving forward.
“We can do tax relief and the spending of the economic
development bill in an informal session,” she said. “It was
unanimous in the House. It was unanimous in the Senate. We
should be able to get it through in an informal.”
Spilka said she wouldn’t be surprised if the governor
proposed funding for some of the provisions in the economic
development bill in a separate supplemental budget.
But she acknowledged that the House would need to go along
to get anything done, and it doesn’t seem like Mariano is
ready to do that yet. The speaker said he wants to see how
the 62F money plays out and how state tax revenues hold up.
“One of the reasons we have this surplus is because we have
been fiscally prudent and very protective of how we spend
our money,” Mariano said.
State House News
Service
Wednesday, August 17, 2022
Senate Acting First on Tax Bill Not Preferred, But Not
Impossible
By Colin A. Young
In the extended back-and-forth over the economic development
and tax relief bill stuck in legislative purgatory, Senate
President Karen Spilka has repeatedly said her chamber wants
to act now but can't without the House doing so first. But
on Tuesday, she gave voice to the possibility that the
Senate could deploy procedural tactics to bring something to
the Senate floor without the House acting first.
Any legislation deemed a "money bill" is required by the
Massachusetts Constitution to originate in the House,
meaning that the Senate cannot introduce a bill that would
either increase or decrease the overall amount of state tax
revenue unless the House has already processed it.
Asked Tuesday if the Senate Ways and Means Committee had
possession of a "money bill" that it could use as a vehicle
to go around the House and bring the stalled tax relief plan
or other measures of the economic development bill onto the
Senate floor, Spilka made clear that it was not her
preferred course of action. But she also did not shoot down
the suggestion.
"Possibly, but if there's no action from the House, it may
not be helpful or productive," Spilka, a former chair of the
Senate Ways and Means Committee, said Tuesday when asked if
the idea was a possibility. She did not say whether the
committee has any such bill in its possession. "I still
think that the best route is for us to be working together
with the administration. And I am very hopeful about that."
Spilka and House Speaker Ronald Mariano remain at
loggerheads over whether to move ahead with their agreed-to
$1 billion tax rebate and reform plan in light of the late
July realization that the 1986 tax relief law known as
Chapter 62F might require the state to return about $3
billion to taxpayers.
The economic development bills that passed the House and
Senate unanimously also include spending for key areas like
housing and hospitals. Spilka reminded reporters again
Tuesday that the Senate "cannot initiate a budget, a money
bill. We are dependent upon either the governor or the
House." She said she expects that Gov. Charlie Baker will
include some of the economic development bill funding in an
eventual supplemental budget.
State House News
Service
Thursday, August 18, 2022
Baker Figures Prominently in Talks About Legislature’s
Return
Enacting Two-Thirds of Eco Dev Bill "Fine With Me," Guv Says
By Colin A. Young
Lawmakers love to deflect questions about conference
committee talks by saying their rules require them to keep
the negotiations private among the three representative and
three senators tasked with finding a compromise. But no one
is making any bones about the fact that the conference
committee still negotiating an economic development bill has
looped in an informal seventh member: Gov. Charlie Baker.
The Legislature ended its formal sessions for the year on
Aug. 1 without coming to agreement on a compromise version
of a $4 billion economic development package that was to
include $1 billion in tax rebates and reforms. The economic
development bills (H 5034 / S 3030) are pending before a
six-person, House-Senate conference committee that meets
only in private, but Baker said Thursday on GBH's Boston
Public Radio that his office is also involved in the talks.
"We've had conversations with both the House and the Senate
about this and are trying to figure out some ground
everybody can stand on," he said. "I got asked this the
other day about am I optimistic that this will still happen?
And actually, I am kind of optimistic. I mean, I don't know
exactly what it will look like, but I do believe that there
will be a piece of legislation that gets to my desk that has
a lot of the elements of this, and I really do believe
that."
Baker said he sees "a couple of possibilities" for getting
some form of an economic development bill done, but did not
say how he thinks it should get done. Senate President Karen
Spilka alluded to Baker's involvement in the economic
development talks earlier this week when she suggested that
Baker might file a supplemental budget that includes some of
the spending called for in the stalled jobs bill.
One part of the original bill that is basically certain not
to be included in anything that reaches Baker's desk is the
bonding that the Legislature intended to approve.
Authorizing bonding requires roll call votes, which can only
take place during the formal sessions that ended Aug. 1.
"If I can get an informal session on two-thirds of what's in
the eco dev bill, that'd be fine with me," Baker said,
referring to the American Rescue Plan Act and fiscal year
2022 surplus spending contemplated in the House and Senate
bills. Baker said he thinks it is realistic to expect that a
bonding-less bill could sail through the Legislature during
informal sessions.
"One member can object, but the eco dev bill passed both
branches unanimously. So ... I think those two pieces,
honestly would, I mean, I do think the so-called votes are
there to get that to our desk," Baker said.
And the governor even suggested on GBH that he's a bit
skeptical of the idea of the House and Senate returning for
formal sessions without having a narrow scope of work,
referencing the controversial lame-duck session developments
decades ago that prompted legislators to set a deadline for
major business of July 31 in election years.
"The issue with coming back in formal session is they would
have to figure out how to come back in formal session in a
way that doesn't turn it into like a whole new session, when
in fact, part of the reason they stopped doing this stuff,
as you may recall, was a whole bunch of things that happened
in late formal sessions after the elections that made
everybody including a lot of people in the Legislature
crazy, which is why they created this 7/31 deadline in the
first place," he said.
While Baker and Spilka would like to see the Legislature
pass some form of tax relief now, House Speaker Ronald
Mariano said this week he is "hesitant" to commit to all of
the spending (including the tax relief) in the economic
development bills without first knowing just how much of its
excess tax revenue the state may have to return to taxpayers
under a 1980s voter law known as Chapter 62F.
The Boston
Herald
Thursday, August 18, 2022
Charlie Baker holds out hope for tax cuts, maintains state
can afford it
By Matthew Medsger
Gov. Charlie Baker apparently has not given up hope that
some version of his tax cut proposal will clear the
Legislature in time for him to sign it before he leaves
office.
“I got asked this the other day about am I optimistic that
this will still happen and actually, I am kind of
optimistic,” he said. “I mean, I don’t know exactly what it
will look like, but I do believe that there will be a piece
of legislation that gets to my desk.”
Baker was making an appearance on GBH’s Boston Public Radio
for an ‘Ask the Governor’ session with hosts Margery Eagan
and Jim Braude.
The Legislature wrapped its formal sessions this year after
passing a number of landmark pieces of legislation, but
failed to advance a $4 billion economic development bill
which would have sent $250 back to taxpayers and codified
several of Baker’s tax priorities before they ran out of
time to act in formal session.
Also at issue were the ghost of 1986 and the efforts of the
late Barbara Anderson to control the legislature’s
taxing authority.
A law passed then, used once after passage but never since,
was triggered by the state’s unexpected boom in tax revenue
last year, potentially sending $3 billion back to taxpayers.
Legislators balked at the potential cost of both occuring at
once, with some claiming Baker had blindsided them with the
laws’ requirements.
Baker has maintained that both tax rebates — the 1986 law
and the Legislature’s plan to send money to low income
taxpayers — are affordable. He stressed again Thursday the
state had the funds to do both.
Further, Baker pointed out, the law has been on the books
and reported to lawmakers for 35 years.
Legislators could also approve most of the plan without
needing to return to session.
Lawmakers are operating informally, without the ability to
hold roll call voters. The bond portion of the $4 billion
economic development plan would have to wait for lawmakers
to return, but the rest — the tax cuts and rebates — could
pass now. As could several provisions which are required for
other programs to function, Baker said.
“The economic development bill passed both branches
unanimously,” he said. “I think those two pieces, honestly
would, I mean, I do think the so-called votes are there to
get that to our desk.”
|
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
BACK TO CLT
HOMEPAGE
|
