The Worcester Telegram & Gazette
Saturday, November 2, 2002
'Bundle of conflicts of interest'
By Richard Nangle
Telegram & Gazette Staff
Governor's Council member Edward M. O'Brien, father of
Democratic gubernatorial candidate Shannon P. O'Brien, has cast nearly two dozen votes since 1998 for judicial nominees who
contributed to his daughter's campaign.
Mr. O'Brien, a Democrat who lives in Easthampton and has
served on the Governor's Council for more than 30 years, says his participation in those votes is not a conflict of
interest. He also insists that he will not resign his seat if his daughter is elected governor on
Tuesday.
The eight-member Governor's Council screens judicial
candidates nominated by the governor. If Ms. O'Brien is elected, her running mate, Christopher F. Gabrieli, who would
become lieutenant governor, would preside as chairman at its meetings.
According to the rules of the Governor's Council, no member
"should act or vote upon a question in which his private right, distinct from the public interest, is immediately concerned."
Ms. O'Brien, who formally announced her candidacy for
governor in December, had been considered by many political observers as among the chief contenders for the seat in the
corner office since her 1998 election as state treasurer.
Records show that she has received several thousand dollars
in political donations from at least 22 judicial nominees among the 144 who have come before the Governor's Council in
the past four years. Thirty-two of the nominees already held other judicial posts and by law
were not allowed to make political contributions.
In recent weeks, the percentage of nominees who have donated
to Ms. O'Brien's campaign has increased considerably, according to records at the Governor's Council office. The
records show little support for other candidates for governor, including
Democrats who challenged Ms. O'Brien in the September primary.
The Governor's Council, as recently as its meeting on
Wednesday, approved a judicial nominee who donated to Ms. O'Brien's campaign. The nomination of John M. Julian of
Dennis, as associate justice of the Edgartown District Court, was confirmed by a 7-1 vote,
with Councilor Mary-Ellen Manning casting the lone dissenting vote.
Mr. Julian's application noted campaign contributions during
the past three years of $250 to Gov. Jane M. Swift; $200 to former Gov. Paul Cellucci; $200 to state Sen. Robert E.
Travaglini, D-Boston, who is in line to become the next Senate president; and $100 to Ms.
O'Brien.
Mr. Julian, like many others who have contributed to Ms.
O'Brien's campaign in recent years, did not donate to other candidates for statewide office, including Secretary of State
William F. Galvin, Attorney General Thomas F. Reilly or Auditor A. Joseph
DeNucci.
The Governor's Council rarely rejects a nominee.
In an interview this week, O'Brien likened his daughter's
possible election as governor to that of the relationship between President John F. Kennedy and his brother Edward, when
the latter was first elected to the U.S. Senate in 1962.
"And as far as I know," Mr. O'Brien added, "the question was
not asked when Warren Tolman was running for governor and his brother was running for re-election to the (state)
Senate."
Mr. O'Brien said his view of a candidate for the judiciary
has not been influenced by contributions to his daughter's political campaign. "The name of the game is integrity."
The Governor's Council made news last month when it
confirmed Dennis J. Curran as associate justice of the Stoughton District Court. Mr. Curran and his wife had made more
than $33,500 in political donations to high-ranking Republicans and Democrats, including
Ms. O'Brien. At the time, Ms. Manning criticized the process of selecting judges, saying they
come from a pool of politically connected people.
In a statement to the board, she also noted that 14 months
had passed since the creation of the vacancy Mr. Curran was to fill. "Many feel that these very desirable courthouse
appointments -- and the accompanying opportunities for courthouse patronage -- are being
dangled before scores of lawyers as attractive bait to produce election workers,
fund-raisers and campaign money.
"The greater part of these donations do not come from the
ultimate winner of the nomination; rather it is extracted from the hundreds of other undiscoverable individuals who have been
sucked into this process during the excessive delays."
That point was echoed by George Pillsbury, director of the
Massachusetts Money and Politics Project, a nonpartisan group that focuses on the influence of money in state politics.
The situation involving Ms. O'Brien and her father, he said, "reflects a problem of a system
where candidates get large donations."
One percent of Massachusetts residents make up the large
majority of political campaign contributors, he said. The top groups of political donors include lawyers, lobbyists,
government employees and representatives of the finance, insurance, real estate and
construction industries.
According to Mr. Pillsbury, "The whole system is a bundle of
conflicts of interest from our point of view."
Former Governor's Councilor Jordan Levy of Worcester makes
it clear that he is not a fan of the state's system of judicial selection.
"I think the whole system is in conflict," he said. He did,
however, defend Mr. O'Brien's affirmative votes for nominees who had contributed to his daughter's campaign, and pointed
out that Mr. O'Brien was acting on nominations submitted by Republican governors.
Mr. Levy, who left his seat in 1998, said that on occasion
he recused himself from votes that involved nominees who had given to his political campaigns. "Ninety-nine percent of the
nominees are politically connected."
If Ms. O'Brien is elected governor, he said, the state
Ethics Commission may have to rule on whether her father can continue to serve on the Governor's Council.
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The Boston Globe
Friday, November 1, 2002
Business, but not as usual
By Steve Bailey
Globe Business Columnist
The last time we elected a governor, the Massachusetts
firefighters union broke ranks with labor and endorsed Paul Cellucci, the Republican, against Democrat Scott
Harshbarger. The payoff was not long in coming: The next year, with backing
from Cellucci, the firefighters came as close as they ever have to accomplishing one of their most cherished goals, climbing
aboard the same Quinn Bill gravy train that has long fattened the paychecks of their brethren,
the police.
The firefighters lost the vote in the House that would have
given them premium pay for completing degrees in "fire sciences," but not by that much. It takes Robert McCarthy, the
president of the Professional Fire Fighters of Massachusetts, just an instant to whip out the
particulars: The union lost on May 8, 1999, by a vote of 84 to 62. "I keep it close to me
always," McCarthy says.
It's another election year, and the firefighters union is
back. This time, the union is playing a leading role in the campaign to repeal the clean elections law. That is McCarthy's
face on the home page of the "No on 3" campaign, explaining why the firefighters have weighed in on
clean elections. "Using state funds to pay for political campaigns," says McCarthy, "is
like burning millions of our taxpayers' dollars every year - millions that could be used for public
safety, local aid to communities, education, health care, and other important
services."
Other important services, like Quinn payments for firefighters? House Speaker Thomas
Jefferson Finneran, who blocked extending the Quinn Bill to firefighters, is on a
mission this year to kill clean elections, shaking down his friends in many of Boston's biggest companies
for tens of thousands of dollars to do just that. The firefighters, like
everyone else, know what Finneran wants this year; the firefighters have made no secret of what they want, either.
This, of course, is how Beacon Hill works, and there are
dozens of versions of the firefighters' story playing out as we come to the end of this election cycle. Right now, days
before the election, we should not be talking about silliness like Mitt Romney's use of a
perfectly good word like "unbecoming" to describe Shannon O'Brien's rude behavior in the
final debate, but about who can get Massachusetts through the toughest times
we have seen in a decade.
Make no mistake: In hard times like these, with the state
facing a budget gap approaching $2 billion next year, the special interests will not be backing off but will be working
harder than ever to protect their turf, and even add to it. (McCarthy, for instance, says the firefighters will
again file their bill looking for Quinn millions. I practically teared up
when the guy was explaining that it was a simple matter of "fairness" that the firefighters should get what the
police get.).
What does it tell you when Beacon Hill has reached such a
consensus on whom its candidate is? O'Brien has been Finneran's candidate from day one; the next Senate president is the
brother of O'Brien's top deputy. O'Brien has gotten four times more money from Beacon Hill
lobbyists than Romney has. The public unions know whom they like: the firefighters, the
MBTA's Carmen, and the state engineers, just to name three, have all endorsed O'Brien.
The Service Employees International Union is offering $75 to any of its members who take
off Election Day and work the polls for O'Brien.
One candidate has spent her career on Beacon Hill, is
married to a former lobbyist, and is endorsed by practically anyone or any group that has ever drawn a paycheck dependent on
Beacon Hill. The other has never been a part of the Beacon Hill crowd, but spent a lifetime
building organizations and creating jobs. In the end, the choice for change is not that difficult.
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The Boston Herald
Saturday, November 2, 2002
Pharmacies fighting Bay State's Rx fees
by Jennifer Heldt Powell
Pharmacists outraged by $36 million in new fees on prescriptions may withhold information
the state has requested to develop regulations to collect it, industry leaders say.
The information about the number of prescriptions a pharmacy
fills and who pays for them is due Tuesday, but pharmacists fear it will be made public and end up helping their
competitors.
"That's pretty closely held information," said Todd Brown,
Massachusetts Independent Pharmacists Association's executive director.
The fee on non-Medicaid prescriptions is scheduled to go
into effect Jan. 1. Some have estimated that it will cost as much as $1.40, but it's impossible to know because no one
tracks how many medicines are prescribed in the Bay State annually, regulators say.
Only about 30 pharmacies have turned in the information
requested by the state, a spokesman for the Division of Health Care Finance and Policy.
Pharmacies will eventually have to give the information
about who paid for prescriptions when the user fee is in effect. But it's not clear that they must turn it over now,
Brown said.
As the state works to enact the new assessment, opponents
try to repeal it.
"The group that's going to be hurt the worst are the elderly
who don't have insurance and who pay out of pocket," said state Sen. Richard T. Moore, (D-Uxbridge).
"The other issue that the pharmacies raised is that in some
of their contracts with health plans, they are limited from passing on any extra and pharmacies are saying they may have to
eat it."
Health plans are trying to determine whether pharmacies can
bill them for the tax.
Moore, co-chairman of the Health Care committee, has
submitted a bill to repeal the tax.
Only a handful of other states tax prescription drugs and
some that have had a tax have abandoned it. Kentucky and New Mexico recently repealed their taxes.
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The Lawrence Eagle Tribune
Friday, November 2, 2002
Politicians shop N.H., avoid tax
By O'Ryan Johnson
Staff Writer
When they need computers, coffee cups or paper clips for
their campaigns, some Massachusetts politicians do what many of their constituents do.
They head to sales tax-free New Hampshire.
And, like most people, they don't pay Bay State taxes on
their Granite State purchases.
By law, they are required to.
But an Eagle-Tribune review of recent campaign expense
reports filed by local candidates for public office found that 19 of 37 incumbent and would-be lawmakers shopped in New
Hampshire and skipped the tax.
They owe taxes on $19,865 worth of purchases since 2000.
That adds up to a tax bill of just over $993, with $584 of
that past due and accumulating interest at the rate of 1½ percent a month. The rest is due by next April 15.
Ten of the local legislators admitted they did not pay the
taxes on campaign supplies but pleaded ignorance of the law.
"I find that almost impossible to believe," said Barbara
Anderson, executive director of Citizens for Limited Taxation.
"They don't know about the state sales and use tax? I see. Well it's good to know they're incompetent as well as hypocritical."
The sales and use tax is 36 years old and is now the state's
second leading moneymaker, behind the income tax. In 2001, it generated $3.7 billion.
The "use" portion of the tax is little known and seldom
enforced, but it has been part of the law from the beginning, intended to discourage Massachusetts shoppers from taking their
business to New Hampshire.
The law requires Massachusetts residents who shop in another
state to pay the difference between the Massachusetts sales tax of 5 percent and the sales tax in the other state. Since
New Hampshire has no sales tax, the use tax here is 5 percent.
A Haverhill resident who buys a $1 taxable item in Plaistow,
N.H., and brings it home owes Massachusetts a nickel.
"It costs more for the stamp to mail in the bill," said Rep.
Barry R. Finegold.
The Andover Democrat owes $59.30 in back taxes on a business
card scanner, Xerox printer and office supplies purchased at Salem, N.H., stores during his 2000 campaign.
Finegold said he doubted he paid the tax, saying it was a
"judgment call."
"I'll check with my treasurer, but I'd be surprised if I
did," he said.
"The issue is not the amount of money," Anderson said. "The
issue is the hypocrisy ... Those that have the gall to vote to raise our taxes, then talk about the fiscal crisis and how we
need more money, for them to slip away to New Hampshire rather than pay a sales tax in
Massachusetts -- the sheer monumental hypocrisy and chutzpah of those people is beyond
expressing."
Closing out the budget debate last summer, lawmakers raised
the average family's tax bill $343, hiked the cost of a pack of cigarettes by 75 cents and froze the voter-approved
income tax rollback.
Finegold was one of the local legislators who voted against
the $1.2 billion tax hike.
State Rep. Jose L. Santiago voted for it. He owes Massachusetts just over $103 in taxes on
$2,071 in office supplies purchased at sales tax-free stores.
Santiago said he wasn't trying to avoid the tax, he just
wasn't aware of it.
"I didn't know anything about buying some paper and ink and
paying a use tax," said the Lawrence Democrat. "If that's the case there's a lot of people in that category."
Tim Connolly, spokesman for the state Department of Revenue,
said that's true.
"The general public I don't think is as aware as perhaps
they could be," he said. "We do have some people with businesses who buy a lot of out-of-state products. That's where
we get most of the use tax."
The use tax law also applies to out-of-state companies that
deliver to Massachusetts.
In the past, businesses with stores in both states endured
harsh penalties for allowing Massachusetts residents to escape the use tax.
Tax agents and state troopers seized the warehouse and
delivery truck of a Salem, N.H., business in 1983 for allowing Massachusetts residents to skirt the tax law. Cuomo's, an
electronics and home appliance store, had shops in Salem, N.H., and a warehouse in
Lawrence.
Before the raid, Massachusetts residents could buy televisions and dishwashers tax-free and
have them delivered to their homes. Department of Revenue officials calculated the
state's loss at $1 million.
Since then, New Hampshire businesses that deliver to
Massachusetts have been careful to collect the tax.
Congressman Martin T. Meehan, D-Lowell, said that's why he
owes no use tax for the $4,529 worth of office supplies he's bought in New Hampshire since 1994.
"We contacted our (accountant); if you have things delivered, you pay a tax on them," he
said. "Let me say this: As a general policy I urge everyone on the campaign to shop in
Massachusetts."
As does state Rep. Brian S. Dempsey. The Haverhill Democrat
spent nearly $30,000 in Massachusetts with most of that money going into his district. But he said sometimes the lure
of Southern New Hampshire chain stores is too much to resist.
"Once in a while there's a convenience issue that forces you
to go at night, and while you want to keep everything local, you don't have a choice," said Dempsey, who voted for the
tax increase this year.
He spent $829.58 in New Hampshire over the last two years
and owes Massachusetts $41.57.
Anderson, the advocate for limited taxes, said lawmakers who
complain that there are no convenient places to shop have only themselves to blame.
"Perhaps they could have gone to an expanded Methuen Mall
that has those stores if they had not driven those businesses out of this side of the border with this outrageous sales tax,"
she said. "There's nothing wrong with politicians being like everyone else (by shopping in
New Hampshire) as long as they're not voting for higher taxes."
When legislators approved the sales and use tax in 1966,
Lawrence businesses said they feared customers would run for the border, taking businesses with them. Since then, different
administrations have tried to enforce the use tax. From tax agents jotting down license plate
numbers in New Hampshire parking lots to state police troopers spying on residents
shopping over the state line, no crackdown has been successful.
In 1986, the Massachusetts Special Commission on Tax Reform
calculated the loss at between $20 million and $25 million per year. Connolly, the Department of Revenue
spokesman, said there is no current estimate on how much the state loses every year
from unpaid use tax.
He said the DOR has given up on hunting down residents who
make cash-and-carry purchases in New Hampshire.
"I think it's fair to say we're not searching for abusers of
the use tax," he said. "It's difficult to enforce. We rely on taxpayers to come forward. If we have knowledge that this
person has bought something (without paying a sales tax) we will ask them to pay. But we don't have an
army of inspectors we could put on the border to check out who's buying things in
other states."
State Rep. Paul E. Tirone, D-Amesbury, who voted for this
year's tax increase, said the only way to enforce the law is with border inspections, which he is against.
"You're getting a little Big Brother-ish with that," said
Tirone, who owes the state $54.03 for tax-free purchases during past races and will owe another $29.11 for what he bought
during this year's campaign. "Do we have to stop everyone who comes back over the border with
liquor and cigarettes?"
After voting to raise taxes this year, state Rep. Arthur J.
Broadhurst, D-Methuen, had three words for anyone looking to collect the use tax he's accrued from trips to Granite State
shops.
"Get a life," he said.
"There isn't a resident who shops in New Hampshire from
Mass. that pays a use tax."
Asked if he paid a use tax on the $179 in items he bought
with campaign money in 2000 and 2001, he said, "No, I haven't.... I shop up in New Hampshire every day, my friend,
and I don't think I've ever paid a use tax."
On his New Hampshire campaign purchases, Broadhurst owes
Massachusetts $8.95, plus interest.
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