CLT NEWS RELEASE
Respect the Voting Majority
October 18, 2001
It must be difficult to write budget stories that contain
both news of a FY'2001 surplus (What shall we do with it?! Spend, save, return to taxpayers in the tax reduction fund...?)...
- AND -
News of a FY 2002 budget deficit, especially when there
isn't yet a FY 2002 budget.
CLT's position: The '01 surplus goes into the Stabilization
Fund and the part that overflows into the Tax Reduction Fund triggers an automatic increase in the personal exemption.
As for the '02 deficit: How can there be a deficit in a
budget that doesn't even exist yet? Budget conferees should take note that the state budget has doubled since the last
fiscal crisis twelve years ago, and make their decisions accordingly.
Billions of dollars are lounging in the Stabilization Fund
and other state slush funds. In addition, spending annual surpluses before they encouraged tax cuts must have generated
enough waste in many budgets to make the search for savings rather easy for any credible
manager.
And there's still the question of what happens to last
year's $579 million surplus.
Clearly there is no problem that justifies overturning the
voters' mandate to "keep the promise" and rollback the state income tax rate to 5 percent.
The rollback was a citizen-sponsored initiative petition
that became a ballot question under Article 48 of the state Constitution. The Cellucci-Swift administration and Citizens
for Limited Taxation beat TEAM, the Human Services Coalition and their allies fair and square,
59-41 percent.
Now the Losers are circulating a non-initiative, non-ballot
petition to urge legislators, the majority of which opposed the income tax hike throughout the campaign and also lost, to
ignore the will of the voting majority.
The Losers should focus on the bizarre situation of a FY'01
budget surplus, an alleged budget deficit in the non-existent FY'02 budget, and on the waste and slush. Legislators
should respect the will of the people and continue with the phase-down
of the income tax rate to 5.6 percent in 2001, 5.3 in 2002, and 5 percent thereafter.
Along with keeping the promise, and respecting the voters,
they will leave more money in the hands of their constituents to help them get through the present economic slowdown.
The Boston Herald
Friday, October 19, 2001
State budget gap not hard to close
A Boston Herald editorial
The Massachusetts state budget gap can be closed without
extraordinary strain -- if our politicians have the will to do it.
Spending cuts and judicious use of reserve funds should be
able to see the state through a recession if it's anything like the "V-shaped" decline with recovery next year that many
economists expect.
The income tax rate cut from 5.6 percent to 5.3 percent
should go ahead as scheduled next year.
The House and Senate have passed versions of the budget for
the current fiscal year that each originally called for spending about $22.9 billion. Recently acting Gov. Jane Swift
and the legislative leadership agreed they should try to hold the total to $22.6 billion. Since then
the evidence has grown that the original total will be $1 billion or more in excess of
available revenues. (October tax collections should give a clearer picture.)
The state has almost $1.8 billion in its rainy-day fund,
plus a $579 million surplus from last year. Reasonable spending cuts, that surplus and a quarter to a third of the rainy-day
fund should do the job.
Already the usual complaints are heard that a worthy program
for the homeless over here or one for the mentally ill over there will be trashed. But the social safety net will remain
even if an innovation or two is deferred.
Chrysler Corp. honcho Lee Iacocca once bragged that he had
never seen a budget he couldn't cut by 5 percent. Note that $1 billion is less than 5 percent of the state's originally
planned total.
Anyone who thinks the budget can't be cut should just read
one. (Current House and Senate proposals are available on the Internet at
www.state.ma.us/legis/bills; H.4195 and S.1901.)
The state's annual spending plan, like Chrysler's in Iacocca's day, contains the essential, the
desirable and the nice-to-have all scrambled together.
Not every dollar devoted to some library's talking book
program is as important as a Medicaid reimbursement dollar. Deciding which dollars can be omitted takes judgment and
courage. That's what we pay our politicians for.
The Union-News
Springfield, Mass.
Friday, October 19, 2001
Editorial
Slowdown puts state in the breakdown lane
Acting Gov. Jane M. Swift was wise this week when she took
steps to immediately curb state spending, but it won't be enough to avoid an economic disaster.
Swift imposed a hiring freeze throughout state government
and also banned nonessential out-of-state travel by state employees.
The hiring freeze in state government is the first since the
early 1990s when state employees were laid off, taxes were raised and the state's bond rating took a nosedive during the
state's last economic crisis.
More drastic steps will be necessary if the state is to
avoid a return to those painful days.
Swift also wants to tap hundreds of millions of dollars in
state reserve to cover a $1.1 billion shortfall in the state budget, and spend more of the money the state will receive as
its share of the tobacco settlement.
Without knowing whether the economic slowdown will last
several months or several years, those are not good options.
For some time, the state experienced a remarkable level of
prosperity, even out here in Western Massachusetts where the economic boom was more like a muffled explosion. Yet,
its days were numbered. The tax cut that former Gov. A. Paul Cellucci and then-Lt. Gov.
Swift packaged and sold to voters left the state in the vulnerable condition in which it now
finds itself.
The tax cut is expected to take $400 million out of state
coffers this year. Calls for a one-year moratorium on the tax cut are not unreasonable and deserve serious consideration.
Lawmakers from Western Massachusetts did a remarkable job
winning support on Beacon Hill for local projects and programs in the proposed state budget. But now that the economy
has slowed, revenues are down and the state has the added expense of the war on terrorism,
many of those local projects and programs will be scaled back or eliminated by legislative
leaders as they negotiate a final budget.
One such program -- among many -- is the Pioneer Valley Life
Sciences project, a biotechnology research initiative by Baystate Medical Center and the University of
Massachusetts at Amherst....
