Governor Cellucci, CLT, Hold News Conference

REVENUES UP: A&F, citing strong tax receipts, upgraded its January fiscal 2000 revenue estimate by $170 million. The new tax estimate for fiscal 2000: $15.46 billion.

State House News Service
Tuesday, April 18, 2000

[Note: FY 1999 Tax Revenue = $14,304 billion]

In the waning hours of the marathon House session, members approved without debate a supplemental spending bill [for this current FY 2000]. The bill - H 5119 - has a bottom line of $68.7 million and provides provides: $15 million for DSS, $9 million for the Division of Medical Assistance, $25 million for MassHighway, $2.5 million for relocating state offices formerly housed in the troubled Saltonstall Building, and $3 million in disaster aid for October 20, 1996 flooding and the Dec. 3, 1999 fatal fire in Worcester. A complete bottom line was unavailable.

State House News Service
Saturday, April 15, 2000

Did you page through the Boston Herald and Globe this morning and think you must have missed the reports on the governor's news conference yesterday? You didn't miss it: Neither paper bothered to report it! Instead, their stories were about his responses to their unrelated questions.

Besides last night's WCVB TV-5 report and Jon Keller's on WLVI TV-56, and an Associated Press account, the only report on the news conference I could find today is from the State House News Service, below. (Also included at the bottom of this: the Gimme Lobby's whining and hand-wringing response, so you can keep track of our enemy's ongoing campaign of fear, lies and unmitigated greed.)

At the news conference, Barbara pointed out another, and perhaps the single most important, reason we must roll back the income tax rate. We're not just keeping an eleven year-old promise; we're not simply rolling back the current tax rate: WE ARE PREVENTING ANOTHER MASSIVE TAX INCREASE -- "temporary" or otherwise -- when the economy ultimately slows down.

The Bacon Hill pols are doing exactly as they did during the Dukakis "Massachusetts Miracle" of the late-80s: spending every cent available, borrowing even more, and creating new entitlement programs that will make increasing demands even as the economy slows and revenues decline.

As senate President Tom Birmingham pointed out, "If we want to expand our health care, particularly for seniors citizens, if we want to improve our public schools, if we want to responsibly pay for the cost overruns that this administration has incurred on the Big Dig, something has got to give."

When Bacon Hill pols start talking "something has got to give," you know they're not referring to spending cuts. The Gimme Lobby's infinite list of "investments" and "unmet needs" means only one thing to those of us who must pay the bills: Hang on tight to your wallets and purses -- they're setting us up for another "unavoidable" tax hike in the fiscal crisis they're now constructing.

If we don't roll back the rate now to five percent then, sooner or later, seven percent here we come! Even the clueless so-called Massachusetts Taxpayers Foundation is finally beginning to see this through its fog of denial.

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Chip Ford

State House News Service
Tuesday, April 18, 2000

Cellucci Cites House "Spending Binge"
in Renewing Call for Big Tax Cut

By Michael P. Norton

STATE HOUSE, BOSTON, APRIL 18, 2000 ... Renewing his call for lower taxes, Gov. Paul Cellucci today bashed the Massachusetts House for spending as much money in one night as his income tax cut would deliver to taxpayers in its first year.

At a press conference, Cellucci said Massachusetts workers pay among the highest taxes in the country. But he said a more important reason for voters to cut the 5.9 percent tax to 5 percent is to reduce the likelihood of spending binges like the one in the House last week. Cellucci said legislative spending is "out of control," noting a House committee added $400 million to his budget plan before House members, largely at an all-night session last Thursday, added $200 million more in floor amendments.

"This is eerily familiar," said Cellucci. "This reminds me of the late 80s when we had a Legislature that was out of control. And they're going to raise all sorts of excuses. I cal  them the thousand and one excuses why we can't cut taxes. They're going to talk about the Big Dig. They're going to talk about all sorts of things. But let me tell you what the real reason is. The real reason was on display. Exhibit A was on display last week on the floor of the House of Representatives. They don't want to cut taxes because they want to spend more money. Let's get that on the table today."

Saying he'll be happy to veto spending increases, the governor added that "if the Senate does what it normally does," the budget to hit his desk this spring may be a billion dollars larger than the one he filed.

Cellucci said the tax cut would safeguard the state's strong economic position and eventually turn back $500 a year to the average family of four. It would also make good on an 11-year-old legislative promise and impose fiscal discipline on the Legislature by taking $1.2 billion out of the annual spending pot, which now tops $22 billion, he said. The tax cut is phased in over several years.

Senate President Thomas Birmingham found fault with Cellucci's logic on taxes. Birmingham said the governor "can't have it both ways" by supporting spending increases and tax cuts. While declining to comment on the House budget and spending amendments, Birmingham said Cellucci "would look for any excuse as opposed to justification to justify this aggressive and regressive tax cut."

"If we want to expand our health care, particularly for seniors citizens, if we want to improve our public schools, if we want to responsibly pay for the cost overruns that this administration has incurred on the Big Dig, something has got to give," said Birmingham. "And we shouldn't try to delude the people of the Commonwealth that we can indulge ourselves in over a billion dollars in tax cuts and continue our efforts in education, health care and meeting other responsibilities."

Big Dig costs, recently estimated at $10.8 billion, may ultimately reach $14 billion, federal officials say.

Birmingham said the Legislature is an easy target for Cellucci. "For some reason collectively we seem to be -- the whole is less than some of the parts," he said. "Individual legislators are usually held in high regard by their constituents." They become a target because the branches don't speak with one voice, he said.

House Speaker Thomas Finneran defended new House spending initiatives designed to improve special education, help the elderly buy prescription drugs, and increase payments to child care providers. He also questioned Cellucci's attack. "I understand that the governor is probably looking to create distraction from a whole host of other issues," said Finneran, apparently referring to Big Dig overruns.

Finneran also said the House budget must be reconciled with the Senate's priorities and ultimately, the governor's input -- Cellucci today pledged spending vetoes. "This will work out," Finneran said. "We will have another balanced budget even if for toda  the governor chooses to characterize it as exuberant spending ... I understand the political argument that the governor continues to make."

The House budget does include an income tax cut, tying it to continuing improvements in the economy. "It's not one that's even dependent upon the voter's sentiments," Finneran said. "It is however conditioned upon real economic growth" to preserve efforts on housing, education and health care fronts.

Jim St. George, director of the Tax Equity Alliance for Massachusetts, said members of the Coalition for Massachusetts' Future are traveling the state to lobby against the tax cut. "Massachusetts needs to invest in education, health care and our infrastructure if we are to be competitive in the 21st Century," said St. George. "We cannot make those investments while financing the Big Dig and paying for this risky tax cut. It's time Gov. Cellucci leveled with the people of Massachusetts: this isn't Wonderland, and we can't have everything." He said the bulk of recent legislative spending is for worthwhile initiatives.

St. George said campaign workers will make the argument that the tax cut will lead to a decline in police, fire and education services, a claim Cellucci says is false based on a string of years in which the state has managed to cut taxes, increase spending and balance budgets.

Lt. Gov. Swift said such claims against tax cuts are "chicken little arguments" and made the case that tax reductions will extend economic prosperity. "The successes of the last nine years have been a result of state government cutting taxes in a way that increased our economic competitiveness and setting priorities so that we could then fund programs that are important to the public health and well being," Swift said.

"If you look at tax receipts over the last several years, when in fact we cut taxes 38 times, it is indisputable that our ability to fund key programs is solely dependent on the strength of our economy," Swift added. "It is not correlated to our tax rate. In fact, as we have cut taxes, we have been able to put significant amounts of money into stabilization funds, we have a significant surplus this year that will allow us to solve some of our bigger fiscal problems like the Big Dig. The key components of our success have been in restraining the urge to spend recklessly, by setting priorities and by having tax policies that isn't responsive to the need to spend money but responsive to the needs of the economy."

Citizens for Limited Taxation Director Barbara Anderson said taxpayers this year are paying a "temporary" tax hike for the eleventh straight year. She said lawmakers are spending freely as part of a political campaign. "They are desperately, deliberately trying to get rid of the money so they can argue this fall that they can't afford a tax rollback and they can't afford to keep the promise," Anderson said.

The House-approved fiscal 2001 budget topped out at more than $22.5 billion, including MBTA spending, after $150 million in spending was added by floor amendments, according to the Massachusetts Taxpayers Foundation. MTF officials say that spending clip is unsustainable over the long term.

State House News Service

BACK TO THE 80'S?: The House-approved budget topped out at more than $22.5 million after $150 million in new spending was added via floor amendments, according to the Massachusetts Taxapayers Foundation.

"That would bring the annual spending increase to above 8 percent," said MTF President Michael Widmer. "That's clearly unsustainable over the long term and may well throw fiscal 2001 out of balance.

This was a significant departure from the House practice of the last decade." Compounding the problem, Widmer said, was approval of two new "entitlement" programs with potentially explosive long-term costs. An aggressive prescription drug assistance program for the elderly will likely cost taxpayers only $10 million or $15 million in fiscal 2001 but could cost between $200 million and $400 million a year in the long run, Widmer said. And an early retirement program for teachers will cost taxpayers about $50 million a year, he added.

"That's very troubling," Widmer said. "We're not saying we're headed into a repeat of the eighties but this is the pattern of the spending practices that took place in the eighties."

The fiscal 2000 budget weighed in at $20.8 billion. The House Ways and Means fiscal 2001 budget plan was a $22.38 billion proposal, including MBTA subsidies. With floor amendments factored in, Widmer said the final House-approved budget topped $22.5 billion.

The usual response from Tax Everything And More (TEAM), creature of the Gimme Lobby and enemy of  all hardworking taxpayers:


Campaign for Massachusetts' Future

Contact: Jim St. George, (617) 426-1228
April 18, 2000

Time to Pull the Plug on the Tax Cut
Cellucci-Swift out of Touch with State's Priorities

The Campaign for Massachusetts' Future today called on Governor Paul Cellucci and Lt. Governor Jane Swift to withdraw their proposed income tax rate cut from the November 2000 ballot. The campaign asserts that it is irresponsible to promote such a massive revenue loss when the state should instead be investing in its future.

"Massachusetts needs to invest in education, health care, and our infrastructure if we are to be competitive in the 21st century," said James R. St. George, executive director of the Tax Equity Alliance for Massachusetts. "We cannot make those investments while financing the Big Dig and paying for this risky tax cut. It's time Gov. Cellucci leveled with the people of Massachusetts; this isn't Wonderland, and we can't have everything."

While Cellucci is critical of the House budget, most of the increased spending went to key programs that enjoy widespread public support. The senior pharmacy program -- a catastrophic prescription drug insurance program -- is available to every senior citizen in the state. The $30 million increase in assistance for special education and the increased reimbursement rate for childcare workers are both important efforts to help vulnerable people. Education, debt service, and public safety alone accounted for most of the increases in the House budget.

In contrast, Cellucci proposed a budget that would have cut local aid for many cities and towns to cover one-sixth of his proposed tax cut. Over 50,000 school children would have been affected by actual cuts in local education aid included in the Cellucci-Swift budget. In Pittsfield, for example, teachers are already facing layoffs this spring, yet the Governor's budget called for a $200,000 cut in aid for education. Furthermore, 27 cities and towns faced a loss of unrestricted local aid that would reduce funding for police and fire protection and other local services. In Quincy, that means either laying off 21 teachers, laying off 16 firefighters, or increasing property taxes.

"Cellucci is just plain wrong when he complains about budget growth outpacing the state's ability to pay. In contrast to the 1980s, over the last five years state spending has grown much more slowly than personal income growth," said St. George. "That's a sustainable pattern that will not create a fiscal crisis in the future."

The Campaign for Massachusetts' Future is a broad-based coalition of individuals organizations, unions, community groups, business leaders, and local and state officials committed to defeating two unaffordable, unfair, and irresponsible tax cuts on the November 2000 ballot.

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