The Boston Globe
Friday, October 12, 2001
Letters to the Editor
Temporary tax was temporary
It comes as no surprise that Chip Ford and Citizens for
Limited Taxation have a lock-stepped negative reaction to columnist Steve Bailey's well-reasoned call for a delay in the
implementation of Question 4 ("Fooling with the tax rollback
again," letter, Oct. 4).
However, it amazes me that during these difficult times for
the state budget (made all the more horrendous by the Sept. 11 terrorist attacks), CLT is unwilling to declare even a
short-term truce in its holy war on taxes.
First, the "temporary" tax increase of the early '90s that
so outrages CLT was indeed temporary. It was an increase to a 6.25 percent rate that has already been rolled back to the
current 5.6 percent. Perhaps that's not the 5 percent holy grail sought by CLT, but it's more
than a 50 percent reduction.
Second, in November 2000, all voters heard about was talk of
billion-dollar state surpluses and promises from the now departed Governor Paul Cellucci that Question 4 could be
implemented without any effect on state programs and services. If voters knew then what
they know today, many would change their vote.
Third, because education, local aid, and now public safety
are sacred cows that the Legislature is loath to touch, one of the few areas left to its discretion to cut is social and
human services.
Commonwealth citizens have a price to pay for our recovery
as a state and a nation from the Sept. 11 horrors. Here in the so-called tax-and-spend human services community, we are
prepared to put on the table a discussion of possible cuts to accounts that do not directly pay
for services for vulnerable and disadvantaged residents.
When will the sanctimonious CLT show a similar willingness
to sacrifice for the greater good?
STEPHEN E. COLLINS
Executive Director
Massachusetts Human Services Coalition
Boston
Acting Governor Jane Swift will impose a hiring freeze
across state government, ban all nonessential out-of-state travel, and propose cuts in state programs to close a $1.1
billion budget shortfall, administration officials said yesterday.
Swift aides say state revenues, already $300 million behind
last year's, will be dismal for the next three months. They say drastic cuts in spending could be necessary and blamed the
mounting fiscal problems on the attacks of Sept. 11 and the regional economy, which was
already sputtering before last month.
The hiring freeze will be the first since the state's fiscal
crisis of the early 1990s. Swift will also ban noncontractual pay increases and could delay the signing of consulting
contracts, said aides, who are familiar with the planning.
"We're well aware that we could be in for some very
difficult times ahead," an aide said. "We want to have plans in place for that now."
Administration budget analysts are anticipating a short,
deep recession with a significant bite in fiscal 2002, which began in July. The mounting fiscal problems could create
political peril for Swift, as some Democrats push for a rethinking of the Republican administration's $1.2
billion income tax cut, which was approved by voters last fall.
The Tax Equity Alliance for Massachusetts is circulating a
petition to drum up support for a one-year pause to the tax cut, which is expected to take $400 million out of state
coffers this fiscal year. TEAM is arguing that that money is crucial to fund key priorities in the new
economic reality.
But Swift opposes any change to the tax cut schedule,
according to her press secretary, James Borghesani.
Swift plans to move quickly on the fronts where she can make
policy by executive order, such as the hiring freeze, and she has not yet decided when she will make the orders official,
aides said. She will likely announce them as part of a broader budget reduction plan, the
aides said.
The hiring freeze will mean that agency heads will need
approval by the Executive Office for Administration and Finance before hiring any state employee. The state will, however,
proceed with plans to hire and train 150 new State Police troopers.
Travel for public safety-related purposes will be permitted,
but all other out-of-state travel would be banned unless specific prior approval is granted, one aide said. "Conventions
would be out," the aide said.
Michael J. Widmer, president of the Massachusetts Taxpayers
Foundation, said those moves will probably save only a few million dollars a year. Far more dramatic cuts will be needed
to make up a deficit on the order of $1.1 billion, he said.
"Those are important symbolic steps, and they save some
money, but that's just putting the toe in the water," Widmer said. "More serious steps have to follow."
Swift aides acknowledge they have yet to formulate specific
spending cuts and said the acting governor will discuss deeper reductions with legislative leaders, who are still negotiating
this year's budget more than 100 days into the fiscal year. She will meet with House Speaker
Thomas M. Finneran and Senate President Thomas F. Birmingham in the coming days to
develop a bipartisan strategy to deal with the likely shortfall.
The legislative leaders had been discussing a $22.6 billion
spending plan, but were already moving toward paring it further. The Swift administration says the state can only spend
$21.5 billion. The Massachusetts Constitution requires the state to have a balanced budget.
With more bad budget news appearing weekly, many on Beacon
Hill appear concerned that they not repeat the mistakes of the early 1990s when employees were laid off, taxes raised,
and the state's bond rating plummeted.
Today, Finneran is organizing a meeting for House members to
talk with former officials who were in charge during the fiscal crisis a decade ago. One goal is to prepare members for the
pared-back budget that is likely to come out of the House-Senate conference committee,
said Charles Rasmussen, a Finneran spokesman.
Swift, Birmingham, and Finneran appear unanimous in their
desire to avoid cutting most education, health care, and public safety spending. All cuts will be made with an eye toward
preserving the state's bond rating, Swift aides said.
Swift will also push to reduce the deficit by tapping
hundreds of millions of dollars in state reserves this year. The state now has about $2.3 billion cash reserves in a pair of
accounts that can be used with legislative approval.
While that money could more than cover this year's projected
deficit, Widmer warned against such a move, because the economic slowdown could last several years. The state
should spend no more than a third of its "rainy day" reserves in a single year, he said.
Administration officials said Swift will also prod the
Legislature to spend more of the money coming to the state via its settlement with the big tobacco companies. That has been a
major item of disagreement in the ongoing House-Senate budget negotiations.
