BOSTON -- As leaders on Beacon Hill piece together ways to fill
a nearly $1.4 billion hole in the state budget, a proposed delay in last year's voter-approved income tax cut appears to
be gaining momentum.
The proposal, which is getting a mixed response among North
Shore lawmakers, was one of the most controversial topics raised when legislators met Wednesday to discuss the
long-overdue state budget.
Legislative leaders may include a tax cut postponement plan
in a state budget package they hope to ship to acting Gov. Jane Swift sometime this month.
The income tax is currently slated to drop from 5.6 percent
to 5.3 percent Jan. 1. Delaying the reduction, which was approved as a ballot initiative last year, could save up to
$200 million.
Swift is expected to veto any plan to thwart the tax cut, so
efforts to override her veto would require two-thirds of each chamber of the Legislature.
Many observers say that level of support hasn't been reached
yet.
Rep. Harriett
Stanley, D-West Newbury, said she is inclined
to vote against delaying the tax cut. She said the savings from avoiding the full income tax cut planned for next year would
only represent a small fraction of the gaping hole in the state budget.
Stanley also said the Legislature should respect the will of
the voters who overwhelmingly approved the tax cut last fall.
However, Rep. Paul
Tirone, D-Amesbury, said he could support
a delay in the tax cut.
He said the weakened economy and the Sept. 11 terrorist
attacks have significantly hurt the state's revenues.
"We're in untested waters right now," Tirone said. "Ever
since Sept. 11, the whole game has changed."
"It should be off the table," said Rep. Brad
Hill, R-Ipswich, one of the lawmakers opposed
to delaying the tax cut. "The people spoke very loud and clear (last year). I'm not
ready to hit the panic button."
Many lawmakers back plans that would delay the cut for a
year or tie future reductions to signs of improvement in the state's economy. Some have talked about simply dropping the
income tax from 5.6 to 5.5 percent in 2002.
Rep. Anthony
Verga, D-Gloucester, said that given the
difficult financial situation facing the state in recent months, he may consider voting in favor of a delay in the
income tax reduction.
"It has to be looked at, but it ought to be the last thing
you look at," Verga said. "The people did vote for it. But when circumstances change things, you have to look at everything."
Senate President Thomas Birmingham said there's no question
the Legislature will have to make dramatic budget cuts -- with or without the freeze on the income tax cut. Those cuts,
he said, will probably hurt more without the extra money saved from delaying the tax cut.
Although Birmingham was among the many prominent Democrats
who opposed last year's ballot question, he said the latest proposal isn't a way to ambush the voter-approved
initiative. Instead, Birmingham said Senate leaders are reviewing the income tax as the state's
economic picture grows darker than previously envisioned.
House Speaker Thomas Finneran said he could consider a
possible slowdown in the tax cut, which is eventually supposed to drop to 5 percent. He added, however, he's going to wait
for action in the Senate before moving such a plan forward in the House.
Area legislators who appear most willing to vote for such a
move include Rep. John
Slattery, D-Peabody, Rep. Thomas
McGee, D-Lynn and Sen. Frederick
Berry, D-Peabody.
"We're talking about massive cuts that are going to affect
cities and towns," McGee said. "We have to take a look at how we can minimize those cuts."
Berry said the Legislature needs to use a combination of
money from the state's "rainy day" reserve fund, its surplus from last year, tobacco settlement cash and savings from the
income tax freeze to lessen the pain of the pending cuts.
Berry, a member of the conference committee charged with
writing the state budget, said cuts will probably hurt hospitals, nursing homes, and group homes for the mentally ill.
"Some of the most needy people in the commonwealth are going
to feel the chills of this cut," Berry said.
Slattery said most voters understand that the state's fiscal
picture has changed dramatically in recent months, particularly after the Sept. 11 terrorist attacks. He said rearranging the
income tax cut's schedule is a responsible move considering the hardship the state is facing.
Rep. Douglas
Petersen, D-Marblehead, said he doesn't want to
counter the tax cut until he receives a clear message from voters that they want to reverse the decision they made at the
polls last November.
Rep. Theodore
Speliotis, D-Danvers, said he wants to give
Swift a chance to fix the problem without relying on postponing the tax cut.
"We've already said no to the people for Clean Elections,"
said Speliotis, referring to the voter-approved initiative that has yet to be funded by the Legislature. "It's a wrong message
to send them to say no on another question."
Other North Shore lawmakers -- such as Sen. Bruce
Tarr, R-Gloucester, and Rep. Michael
Cahill, D-Beverly -- aren't willing to rule it out.
Cahill said postponing the tax cut should be on the table,
but he said he hasn't received enough information about the delay's potential impact to make a decision.
Like many other legislators, Tarr said lawmakers should be
looking at other ways to save money first.
"Even if we delay it, it's not going to produce the dollars
we need to fix our problem," Tarr said. "(But) we're living in extraordinary times and we need to think about everything to
meet the needs that we have."
