"That's $1.1 billion in revenue lost. That's billion with B. ... It doesn't take a mathematical genius to see that when you reduce revenues and you increase costs -- because the state budget is up -- you have some problems."

Peabody Mayor Peter Torigian
on Massachusetts Mayors' Association's
opposition to income tax rollback

The Evening News
Salem, Mass.
Tuesday, February 29, 2000

Torigian to fight state income tax cut
By Alan Burke
News staff

PEABODY -- He's built his reputation on keeping taxes low, but when Mayor Peter Torigian is in Boston today, he'll be hoping to keep the state's income tax right where it is.

Torigian will be part of the Massachusetts Mayors' Association meeting at the Lafayette Swiss Hotel, a gathering meant to discuss state aid and how to keep to keep it coming. Opposing a rollback of the statewide income tax is a key element of that, the mayor suggests.

Boston Mayor Thomas Menino will host the group, while mayors from Worcester, Springfield, North Adams and Leominster are among those who will attend. Finance directors from each city met last week to lay the groundwork for the agenda.

"The Big Dig may be one of the issues being discussed," Torigian says, "as well as the tax-cut proposals and the action to be taken to oppose them." Lobbying is one possibility, he adds.

Torigian is uncomfortable with tax cuts because he worries any decrease in state revenues will reduce state aid to cities and towns. Aid to education, transportation and affordable housing will all suffer, he says.

A proposed initiative petition by Citizens for Limited Taxation would reduce the state income tax from 5.75 percent to 5 percent. Advocates point to overflowing state coffers and a tobacco settlement due to pump billions into Beacon Hill as reason enough to do it now.

Gov. Paul Cellucci has endorsed the move to bring the income tax rate back to 5 percent.

But Torigian sees it differently. "That's $1.1 billion in revenue lost. That's billion with B," Torigian says.

"It doesn't take a mathematical genius to see that when you reduce revenues and you increase costs -- because the state budget is up -- you have some problems," he says.

The result, he worries, will be to force cities and towns to a greater reliance on real estate taxes.

"That's the most regressive tax there is," he says. Economists say property taxes tend to fall more heavily on those who earn less money, including many on fixed incomes.

"Who's not in favor of lower taxes?" Torigian asks. "I understand taxes full well."

Nevertheless, Citizens for Limited Taxation is promoting the petition to reduce the state income tax to what it was before 1980, 5 percent. When the income tax was increased from that level, according to the citizens' group head Barbara Anderson of Marblehead, it was billed at the time as a temporary measure meant to deal with a temporary budget imbalance.

Yet, instead of rolling back the tax once the crisis passed, the Legislature has actually increased it, Anderson says. As for Torigian's position, she says, "I think it is very foolish for any mayor to say it's all right for legislators to break their word."

Additionally, a petition is being promoted that would eliminate turnpike tolls, possibly creating another drain on state revenues.

Behind all the state's money woes is the specter of the Big Dig, recently hit with $1.4 billion in cost overruns and a temporary loss of federal money.

In the midst of a signature drive to get her petition on the ballot, Anderson belittles these concerns, saying, "They have so much money on Beacon Hill, they don't know what to do with it all."

The state is due to collect $8 billion in a settlement with tobacco companies, at a rate of $300 million per year, she points out.

"It comes with no strings attached," she says.

Clearly regretting Torigian's opposition to her petition, Anderson recalls with nostalgia his position on Proposition 2 some 20 years ago.

"I remember him coming to a speech I gave. He was sitting there in the back of the room. I was arrested by these big, dark eyes on me throughout the speech. He listened to every word I said," she says.

As Anderson remembers, the new mayor did not oppose the Proposition 2 ballot initiative, which limited the ability of cities and towns to raise taxes. And when it passed, she says, "he was one of the mayors who best instituted Proposition 2."

Commonwealth of Massachusetts
Department of Revenue

March 2, 2000

Contact: Patricia Campbell Malone, Jeffrey Busha
(617) 626-2251

February 2000 Revenues Total $865.3 Million

Revenue Commissioner Frederick A. Laskey today announced that revenue collections for February 2000 totaled $865.3 million, up $113.5 million or 15.1 percent from last February. Year-to-date revenue collections totaled $9.59 billion, up $563.0 million or 6.2 percent above last year. Collections for FY2000 are $102 million above the midpoint of the revenue estimate range, which is based on the Administration & Finance annual estimate of $15,288 billion.

"Revenue collections continue to remain strong. Income, withholding and sales tax collections all show solid growth from last year," said Laskey.

Income tax collections for February, which included an extra deposit day, totaled $481.0 million, an increase of $83.8 million or 21.1 percent when compared to February 1999. Withholding tax collections totaled $696.8 million, up $102.7 million or 17.3 percent. Sales and use tax collections totaled $263.3 million, up $33.6 million or 14.6 percent. Corporate collections totaled $16.6 million, up $975,000 or 6.3 percent compared to last February.

Year-to-date income tax collections totaled $5.65 billion, up $375.9 million or 7.1 percent. Withholding collections totaled $4.94 billion, up $400.3 million or 8.8 percent. Total sales and use tax collections totaled $2.35 billion, up $195.3 million or 9.1 percent. Corporate collections totaled $431.0 million, up $13.9 million or 3.3 percent.

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:

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