A new study, released today by the
Beacon Hill Institute at Suffolk University shows that Massachusetts
can weather the current fiscal crisis without cutting spending and
without postponing planned tax cuts. Last year, Massachusetts voters
overwhelmingly approved a ballot measure that called for a reduction
in the state income tax to 5% by 2003. Postponement of this tax cut
would be unnecessary and would, moreover, deepen the recession into
which the state is currently sinking, according to the study.
Conclusion: Stay the Course
Our analysis shows that the large
surpluses accumulated in the 1990s make it possible for the state to
manage the current revenue falloff with only minimum adjustments in
its spending plans. Postponing the tax cut would be both unnecessary
and unwise. There is no need to take an action that would destroy
33,000 jobs just as the state finds itself struggling to recover from
a recession.
Even if spending cuts were
necessary, however, the legislature might be advised to think twice
before postponing the scheduled cuts in the income tax or increasing
other taxes. Legislators and others who would postpone tax cuts
approved by the voters are threatening to compromise the democratic
process. The idea that the state cannot "afford" a tax cut
presupposes that individual taxpayers can, on the other hand, afford
to make sacrifices of their own. Better to adopt a policy of
"shared sacrifice" than to go on blithely running up the
state budget.
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The Boston
Globe
Tuesday, November 13, 2001
A Boston Globe editorial
Budget necessity
MASSACHUSETTS voters approved a tax
cut just last November, but given the sudden onset of the state fiscal
crisis it might as well have been a lifetime ago. House and Senate
leaders, as they work on their long-overdue budget, would be
irresponsible if they did not suspend the tax cut to cope with the
sudden drops in revenue and the unexpected expenses caused by the
Sept. 11 attacks.
Acting Governor Swift has filed a
$26.5 million request for extra money to pay for State Police overtime
and a new class of police cadets to provide additional security after
the attacks. That is only a down payment. The governor and Legislature
need to make sure that the Department of Public Health, for instance,
receives adequate money to provide better protection against
bioterrorism.
Yet the Swift administration is
talking about a $66 million cut in public health programs. This may be
no more than a ploy to force the Legislature to devise a budget that
will use the reserve money that Swift cannot tap on her own. But it
does underline the magnitude of the problem as Massachusetts continues
to operate for the fifth month without a budget.
The Legislature dawdled two years
ago, but during that prosperous time, most state agencies could at
least count on receiving the same amount of money as in the previous
years. There can be no such guarantee now. Even with the $200 million
tax cut suspended this year, the state would be facing hundreds of
millions of dollars in cuts as revenues drop to recessionary levels.
Government agencies need a budget now so that they can reduce costs
with a minimum of pain.
During the last downturn, in
1989-91, the state had not yet committed to its ambitious guarantee
that children in every Massachusetts community would receive an
adequate education. This must be protected in the budget, but this
necessity reinforces the urgency of suspending the tax cut for now.
The state needs a budget quickly -- one that is fiscally and socially
responsible. The tax cut can wait until prosperity returns.
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To: The Boston Globe, Letter
to the Editor
Submitted: November 13, 2001
In its editorial, "Budget
necessity" (Nov. 13), the Boston Globe
decreed: "The tax cut can wait until prosperity returns."
Who do they think they are fooling?
Throughout the past decade of a
booming economy, staggering state surpluses, and
record prosperity, not once did the Boston Globe
call for an end to the 1989 "temporary" tax increase. The
Globe continues still to oppose "keeping the
promise," even though voters took matters
into their own hands last November and
overwhelmingly voted to roll it back, responsibly over three
years.
For a newspaper that champions
full-funding of the voter-approved "Clean
Elections Law" -- also adopted overwhelmingly
by the voters -- its narrow-minded hypocrisy is simply
staggering, though not uncharacteristic.
CHIP FORD
Director of Operations
Citizens for Limited Taxation
The Telegram
& Gazette
Worcester, Mass.
Friday, November 9, 2001
Editorial
Save the rollback
Under the guise of budget austerity,
the Legislature on Wednesday kicked off a campaign to delay --
translation: nullify -- the long-awaited rollback of the state income
tax.
The move to derail the phase-out of
surcharges imposed after the collapse of the Massachusetts
"miracle" was hardly surprising. The Beacon Hill
tax-and-spend crowd is contemptuous of the notion that the Legislature
should honor its pledge that the tax hikes would be temporary.
What was astonishing was the
in-your-face timing: exactly one year after voters decisively approved
Question 4, forcing the rollback.
The move is ill-timed economically
as well. Massachusetts' sluggish economy needs the stimulus of tax
relief now more than ever.
State government's fiscal position
is, indeed, serious. A prolonged slump could mean tax collections
would fall short of budget-writers' projections by as much as $1.35
billion.
That means lawmakers have to trim
back the $22.9 billion spending wish lists, compiled in the heady
atmosphere of revenue surpluses six months ago, to the fiscal 2001
spending level of $21.5 billion.
Serious belt-tightening is in order,
but drastic measures to balance the books are not required. There is
no justification for such measures as defunding the Clean Elections
Act -- another people's mandate lawmakers are striving to nullify --
or slashing local aid, education and health care, as Senate President
Thomas F. Birmingham threatened to do.
While lawmakers pondered taking away
the people's tax rollback with one hand, they were passing out goodies
to special interests with the other -- including a $5 million giveaway
to the well-connected Massachusetts racing industry.
And even a cursory examination of
legislative perks would yield fat that's ripe for trimming, such as
the $92,000 position of Statehouse physician, even though some of the
world's premier hospitals are just minutes away.
A year ago this week, voters sent
the clear message that they want prudent, sustainable growth in state
government, not hyperinflated expansion. Lawmakers should heed that
message and forget the dubious schemes for withholding the
long-overdue tax-rate rollback.
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The Berkshire
Eagle
Monday, November 12, 2001
Editorial
Protecting doomed racetracks
It should be obvious to even the
most committed racing fan that the state's horse and dog tracks were
not even an endangered species anymore. Not so with the state
legislators, who never met a contributor or lobbyist they didn't like,
even in a state faced with major budget problems. The result: A
bailout of $5 million to the track owners who, unlike small family
groceries or pharmacies or convenience stores, will have some
taxpayer-paid insurance against falling markets, at least for the
moment.
The tracks are dying, but it isn't
the business of government to keep them alive, especially by allowing
the perilous introduction of slot machines, which some legislators
quietly advocate.
While the state ponders cuts in
education, health care and social service programs, it is a disgrace
to be throwing millions of dollars at an industry that should be
allowed to die an overdue death by natural causes.
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The Boston Herald
Tuesday, November 13, 2001
A Boston Herald editorial
Tax holiday is no fantasy
While legislative leaders continue
to count noses to see if they have the votes to take back the tax cut
people voted themselves last year, acting Gov. Jane Swift is going in
a whole other direction.
Swift last week proposed a two-day
sales tax holiday -- an effort to jump-start the holiday shopping
season, which already has merchants jittery enough to be planning
pre-Christmas sales. Computers, toys, electronic gear, even cars would
all be covered under the proposed tax-free days.
The proposal would cost the state
about $40 million in lost revenue, but Swift says most of that (some
$34 million) could be covered by the Tax Reduction Fund, in which some
previous surplus revenues (ah, remember those days!) are stashed.
Extraordinary times call for
extraordinary measures. And while there is little solid economic
evidence that such measures really can increase spending, never before
has there been a time when people needed to be coaxed out of their
homes and into shopping malls. So there is every reason to give it a
try now.
The hope is that once people hit the
malls, they'll be looking at all kinds of other things for which the
tax holiday isn't even an issue. Most clothing isn't subject to a
sales tax, but then that pretty pink sweater isn't likely to get
purchased if it's never seen by customers reluctant to travel anywhere
but home to work and back home again.
Of course, the tax holiday will be
nothing but a sugar-plum fantasy if business leaders and their
potential customers don't press their case on Beacon Hill. If clueless
legislators remain focused on how much money they can take from
consumer's pockets, not how much they can give back, the case for a
tax holiday is lost before it even gets off the ground.
The measure demands immediate action
to be effective by Dec. 1 and 2 as the governor proposed. Voters will
surely remember who helped them out this holiday season, and who voted
instead to put coal in their stockings.
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The Boston
Globe
Tuesday, November 13, 2001
State budget outline said near
Leaders eyeing $500m in cuts
By Rick Klein
Globe Staff
House and Senate leaders are close
to reaching an agreement on the long-stalled state budget that would
cut about $500 million in spending -- $200 million less than Acting
Governor Jane Swift has called for -- legislative sources said
yesterday.
The plan would allow the state to
cut fewer jobs than the 5,000 Swift has proposed eliminating, and
preserve more money for health care and aid to cities and towns. It
would also tap reserve funds for up to $700 million - more than twice
as much as Swift would spend from those accounts.
Still undecided is whether the House
and Senate will approve a freeze or slowdown of the voter-approved
rollback of the income tax - a politically perilous question. If they
do not pursue the freeze, the rest of the $1.4 billion budget gap
would be closed with a combination of additional program cuts and the
use of more money from the state's settlement with tobacco companies.
The legislative sources stressed
that the plan is an outline, and said specific reductions are still
being negotiated. But they said the pact could be announced within the
next few days.
Legislative leaders have faced
increased pressure in the past few days to end the four-month-old
budget deadlock. Massachusetts is the only state in the nation that
has yet to pass a budget this year, and Swift accused House and Senate
leaders yesterday of acting like children because they've been unable
to agree on a plan.
But the House and Senate leaders
seem to be struggling to fully address the problem. Independent budget
analysts have said that $500 million is the bare minimum the state
must cut to balance its books this year.
Told of the House-Senate approach
late yesterday, Michael J. Widmer, president of the Massachusetts
Taxpayers Foundation, said lawmakers should shave additional spending.
Using $700 million from reserve accounts -- which total about $2.3
billion -- may be too much, Widmer said, and would allow state
government to keep spending at levels that are too high.
"It almost certainly will mean
additional spending cuts next year," Widmer said.
Senate President Thomas F.
Birmingham and Senate Ways and Means Chairman Mark C. Montigny
declined to comment on ongoing budget talks, saying the discussions
are confidential. House Speaker Thomas M. Finneran and his Ways and
Means chairman, John H. Rogers, declined requests for interviews.
At a press conference, however,
Birmingham reiterated his support for a freeze of the income tax rate
at 5.6 percent, despite voters' overwhelming approval last year of a
ballot question to roll back the rate to 5.3 in 2002 and to 5 percent
the following year. The tax change is now being debated.
The income tax freeze would save the
state between $150 million and $200 million this fiscal year,
depending on how it is constructed. But it would force the average
family to pay about $150 in income taxes next year that they would
have been spared.
Birmingham and Finneran are
uncertain whether they have the votes to approve the freeze. Some
members fear a backlash.
The legislative leaders hope to
approve a budget agreement by Nov. 21 -- the last day of the
Legislature's regular session -- and then return for a special session
in December to deal with what are likely to be numerous line-item
vetoes of their plan by Swift. Swift has already vowed to veto any
change in the income tax rollback, which she strongly supported. A
two-thirds vote is needed for a veto override.
Swift plans to file legislation that
includes her own recommended budget cuts -- totaling $700 million --
by Friday if the Legislature has not reached an agreement by then.
The acting governor's proposal will
include a $100 million to $150 million cut in aid to cities and towns;
$66 million less for public-health programs; a $96 million slash in
funding for human services; the elimination of 5,000 state jobs for
savings of $200 million; the spending of the state's entire $290
million annual payment from the tobacco lawsuit settlement; and a $100
million reduction in state contributions to public employees' pension
program.
However, Swift yesterday rejected
the idea of a $34 million cut in K-12 education, according to her
administration and finance secretary, Stephen P. Crosby.
Swift hopes the elimination of 5,000
jobs - representing 7 percent of the state workforce - can be achieved
through early retirements. She wants to encourage workers to leave by
sweetening their pensions, crediting them with more years of service
than they actually worked. Crosby said that would not immediately cost
the state money, but he could not say whether there would be a
long-term financial impact.
Swift has not detailed all the
agencies where jobs would be cut. But Crosby identified a few areas
yesterday: 53 jobs from the Department of Revenue, 120 from the
Massachusetts Highway Department, and 58 from the Registry of Motor
Vehicles.
Other reductions are possible at the
Departments of Mental Retardation and Youth Services, and juvenile
courts.
Swift's proposal needs legislative
approval. Birmingham yesterday said that the Legislature is making
"substantial progress" on its own budget and Swift's
participation is unnecessary, and he hinted that her interest in the
budget process is an attempt to divert attention from problems at the
Massachusetts Turnpike Authority and the Massachusetts Port Authority.
"You'll have to determine
whether it's a diversion or not," Birmingham said.
However, the Senate president said
he could offer no excuses for the budget stalemate.
"I'm not going to complain. I'm
going to do my job as best that I can," he said.
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The Boston
Globe
Tuesday, November 13, 2001
Risk seen in $66m cut to health
budget
Swift plan is called ill-timed
By Ralph Ranalli
Globe Staff
The Swift administration risks
reversing years of progress against disease by proposing $66 million
in cuts to state Department of Public Health programs, specialists and
advocates say.
Millions of dollars invested in
research, screening, and education on everything from cancer to AIDS
have made Massachusetts a model in preventing health troubles from
becoming chronic, costly problems, specialists say. Now those programs
are slated to be the first cut as Acting Governor Jane Swift aims to
close a $1.4 billion gap in the state budget.
Critics charge that the planned cuts
are not just short-sighted, but ill-timed. Swift is proposing them
even as Congress is debating massive new federal public health
spending, particularly on bioterrorism-related research and vaccines.
The state reductions would send the wrong message to residents, who
these days are as fretful about opening their mail as boarding a
commercial jet, advocates said.
"This is going to devastate the
public health infrastructure in Massachusetts ... at a time when we
are facing new threats of bioterrorism," said Laurie Stillman,
executive director of the Massachusetts Public Health Association.
"It's incomprehensible."
Dr. Richard Zane, chairman of the
disaster committee at Brigham and Women's Hospital, said that although
public health has traditionally been "grossly underfunded"
across the country, Massachusetts has been "ahead of the
curve" and should be working to stay there.
"This is not the time to cut
budgets; it is time to increase resources," Zane said.
"Public health and bioterrorism prevention should be in the same
current [funding] situation as the police and the military."
Administration officials, though,
insist they have no choice but to trim the department's $500 million
budget, because the agency is annually one of the state's 10 biggest
spenders. Over the weekend, Swift proposed eliminating $700 million in
state spending and letting go 5,000 state workers. The Legislature is
coming up with its own plan for cuts.
"DPH has a big budget, and when
you are looking at hundreds of millions in cuts, you have to look at
the big areas," said Dominick Ianno, a spokesman for the state
Executive Office of Administration and Finance.
Advocates say they are disturbed
that two proactive and efficient programs, hepatitis C screening and
school nurses, have already been cut. While the cost of early
treatment for hepatitis C averages about $18,000 per person, the
average liver transplant costs nearly $250,000 -- and hepatitis C is
the number one cause cited for liver transplants, Stillman said.
The proposed cuts for next year
slash funding for numerous programs, including:
$17 million from AIDS prevention
programs;
$5 million from breast cancer
screening and awareness efforts;
$5 million for family planning and
health services, including programs for teenage mothers; and $2.8
million for prostate cancer research.
Department of Public Health
officials insist that there will be no skimping on spending to prevent
and detect bioterrorism, and respond, if necessary.
The department's laboratories test
suspicious substances for anthrax and other contamination; its
investigators monitor doctors offices and hospitals for signs of
epidemics; and its staff would be in charge of coordinating
large-scale vaccinations or innoculations, if they become necessary.
"The department would do what
is necessary to meet the emergency," Jacobsen said.
Yet specialists like Zane and
Stillman say the state should not back off its commitment to other
areas. If necessary, Stillman said, the state should roll back tax
cuts or divert money from the state's tobacco lawsuit settlement and
the state reserve, or rainy-day, fund to keep proactive programs
intact.
"If there was ever a rainy day,
this is it," she said.
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The Boston
Herald
Tuesday, November 13, 2001
Frustrated Swift demands lawmakers
finish budget
by Elisabeth J. Beardsley
Acting Gov. Jane Swift gave a verbal
spanking to lawmakers yesterday, accusing them of behaving like
toddlers and threatening unilateral spending cuts if they can't finish
a state budget by Friday.
An animated Swift -- jabbing her
finger, raising her voice -- said she's lost patience after four-plus
months of cajoling House and Senate leaders to cut a deal. Now, Swift
said, it's time to deal with lawmakers like she would an unruly
3-year-old.
"We can do this the easy way,
or we can do this the hard way," Swift said. "Sometimes, you
don't know why, they choose the hard way."
The attack on the Legislature -
which Swift made in the middle of a high-level meeting where
administration officials pinpointed $500 million in spending cuts -
devolved into finger-pointing between Swift and Senate President
Thomas Birmingham, a likely gubernatorial rival.
Birmingham called a hasty press
conference, arriving in jeans at the State House, which was closed for
Veterans Day. He said he was shocked that Swift had rounded on
lawmakers.
In a private weekend conversation,
Swift "took no exception" to lawmakers' rejection of her
offer to mediate negotiations, he said.
"I'm frankly surprised and
taken aback a bit by the rhetorical tone that has been struck by the
administration," Birmingham said.
Speaker Thomas Finneran declined
comment, and Ways and Means Chairman John Rogers could not be reached.
Finneran, however, has supported
Swift's plan to help close a $1.4 billion hole in the $22.65 billion
budget by cutting at least $700 million and drawing $500 million in
cash reserves.
Swift criticized what she called
"dilly-dallying, denial, pretending we don't have a problem"
by Senate leaders who are fighting to avoid unpopular spending cuts by
spending more in cash reserves.
"If by Friday, they haven't
passed a budget, then clearly they're incapable," she said.
"They should just do mine and let them blame me."
Birmingham, who refused to detail
his negotiating chits but claimed to be making "progress,"
blasted Swift's proposed cuts in local aid, education and public
safety. He blamed the budgetary woes on the voter-approved income tax
cut, which both the Senate and House are trying to postpone.
"(Swift's) in a straitjacket
based on a no-new-tax pledge that is more appropriate for the governor
of New Hampshire," Birmingham said.
As the rhetoric flew, administration
number-crunchers were getting Swift's approval on the first $500
million of an expected $800 million in cuts that Swift may have to
impose.
About $30 million was whacked out of
education programs like early literacy, transportation and enrollment
growth aid. But Administration and Finance Secretary Stephen Crosby
said Swift rejected any cuts to the $3.2 billion education reform
account.
In health care, Swift ordered
protections for nursing homes and hospitals, children's health
programs and rape crisis centers. But Swift approved most of the
proposed $95 million in other human service cuts, including programs
aimed at preventing AIDS, breast cancer, prostate cancer and smoking,
Crosby said.
While administration officials
nicked $7.5 million out of the Executive Office of Public Safety's $1
billion budget, Crosby said Swift is girding for more
security-relating spending.
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The Telegram
& Gazette
Worcester, Mass.
Tuesday, November 13, 2001
Agencies, lawmakers feeling budget
pressure
By Shaun Sutner
Telegram & Gazette Staff
BOSTON-- Last week, state Rep. John
J. Binienda, D-Worcester, called Francis R. Carroll, chairman of the
Korean War Memorial Committee of Central Massachusetts, with some
unsettling news.
Mr. Binienda told Mr. Carroll to
expect the worst, that the $75,000 to $150,000 his group was expecting
for a memorial to Worcester County soldiers who died in Korea was now
at risk of being cut from the state budget.
"I'd say the $150,000 is
history and the $75,000 is in jeopardy," Mr. Binienda.
"Nothing is safe." The memorial is to be built in Worcester.
As most state workers stayed home in
observance of Veteran's Day, House and Senate budget negotiators met
again yesterday to thrash out a budget agreement that many Statehouse
observers expect this week, possibly today or tomorrow.
Gov. Jane M. Swift kept up the
pressure on the Legislature, repeating her threat to make her own
severe budget cuts and lay off 5,000 state employees unless lawmakers
hand her by Friday the budget that was originally due July 1.
Lawmakers have been wrestling with a
$1.3 billion to $1.6 billion deficit caused by plummeting state
revenues. They have been unable to agree on what cuts to make and how
much to draw from reserve funds and the state's share of a national
settlement with tobacco companies.
While the governor can make cuts if
the Legislature fails to deliver a budget, she does not have the
authority to draw from reserve funds, which would lessen the cuts
needed.
"If they don't act, the cuts
will be deeper," said Shawn Feddeman, a spokeswoman for Ms.
Swift. "She's hopeful that the Legislature will act because the
people will be losing out on this."
Also yesterday, Senate President
Thomas F. Birmingham, D-Chelsea, said Senate and House leaders are
making major strides toward an agreement.
Still an option, Mr. Birmingham
said, is a temporary freeze of the first year of the income tax cut
approved by voters last year. It is unclear whether the proposal has
enough votes in the Senate or House to withstand a certain veto from
the governor.
Calling Ms. Swift's opposition to
the freeze "a straitjacket approach," Mr. Birmingham said
suspending the tax cut would free up $200 million to spare schools,
police and fire funding and health care programs from budget cuts.
"In typical Republican fashion,
she's driven by a 'no new taxes' approach," the Senate president
said. "Nobody's talking about a new tax. It's a freeze."
Charles Rasmussen, a spokesman for
House Speaker Thomas M. Finneran, D-Boston, declined comment.
Besides local projects such as the
Korean War Memorial, a range of programs in Central Massachusetts are
likely to be cut, lawmakers and advocates say.
Worcester-based programs
administered by the Seven Hills Foundation for mentally ill people,
and addiction detoxification services provided by Community Healthlink
are examples of human services likely to be targeted.
Also vulnerable are higher education
funding, school nurses, raises for human service workers and so-called
"local aid" payments to cities and towns.
While House leaders have said they
do not want to cut local aid, Ms. Swift says she would make $96
million in local aid cuts, and the Senate has also refused to rule out
local aid cuts.
Cities such as Worcester and
Fitchburg, and some towns with diverse populations and urban-style
problems such as Southbridge, Webster and Milford, depend heavily on
local aid payments.
State Sen. Richard T. Moore,
D-Uxbridge, who represents those three towns, advocates measures other
than cutting local aid.
Like many in the Senate, he wants to
draw more heavily than the House on the tobacco funds, and to lower
payments to the state pension fund, a move Mr. Finneran adamantly
opposes.
Mr. Moore and other legislators are
also dismissing Ms. Swift's layoff threat.
"I don't know if people are
paying too much attention to that kind of rhetoric, but the
Legislature is working hard to produce a budget," said Mr. Moore,
who does not support the income tax freeze.
Meanwhile, human service advocates
are bracing for cuts that are almost inevitable. Their services are
not in the areas widely viewed as protected from major cuts, such as
direct school aid and most public safety expenditures.
They have met with their
representatives and senators in recent weeks to plead their case.
Increasingly, the response has been that anything and everything is on
the table.
"Sure, we're worried,"
said Deborah J. Ekstrom, executive director of Community Healthlink.
"I've been told by local legislators that there are parts of the
budget that are sacred, and we're not sacred."
Some local people such as Mr.
Carroll, of the war memorial committee, are taking a more combative
approach.
Mr. Carroll said he would settle for
$75,000 from the state -- the low end of what his group expected --
for the marble and brick memorial to commemorate the 189 young men
from Worcester County who died in the Korean War.
"These kids who died 50 years
ago, we owe it to them," he said. "Even with all the
downturn we've experienced, it's too easy for a Legislature to say ‘we
can't give it to you in the budget.’
"They've got the money,"
he said.
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