Citizens for Limited Taxation & Government
"The Commonwealth Activist Network"
18 Tremont Street #608 * Boston, MA 02108
Phone:(617) 248-0022 * E-Mail: cltg@cltg.org
Visit our web-page at: http://cltg.org
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*** CLT&G Update ***
Friday, March 20, 1998

Greetings activists and supporters:

I’m replaying a bit of our news release of February 23rd, below, so you will recall and can compare it to today’s view of reality as it’s finally come to be recognized.

Better late than never.

Though unfairly charged with being partisan supporters of one candidate over the other, as always we were simply standing up for Truth. As usual, we were ahead of the awareness curve and have again been proven the one voice of credibility if not prescience. Even the Boston Globe (see today’s editorial below) has recognized it.

As I wrote earlier this week, I don’t hate saying "I told you so" any more! I’ve gotten over it.

Chip Ford—
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NEWS ADVISORY
February 23, 1998

RE: CELLUCCI/MALONE (in alphabetical order) AND TAXES

NOBODY ASKED US, BUT...
We are neutral on Republican gubernatorial politics. We support both Governor Cellucci and Treasurer Malone, and it is up to the Republicans, not us, to choose among two fine candidates for nomination in 1998.

But we are not neutral on taxes. And we dislike injustice. What is being done to Joe Malone on our tax issue, by some in the media, is simply wrong.

It doesn’t take a lot of checking to determine that what he has been saying about a tax increase last year is accurate. And by the way, no one from his office or campaign initiated this advisory; they are being very tolerant of our neutrality, even though Joe has done so much for both CLT&G and the taxpayers over the years—as, in our opinion, has Paul Cellucci. We do not agree with the tone of the attack by our former Chairman Edward F. King on the Weld/Cellucci Administration, and we strongly object to the attacks on Joe Malone on this tax issue by whoever makes them.

[ . . . ]

Governor Weld and the House and Senate leadership, both Democrat and Republican, decided to increase the amount in the stabilization fund before putting money in the tax reduction fund. This resulted in a much smaller increase in the personal exemption than taxpayers would have received for tax year 1998 and in future years, and therefore an increase in taxes beyond what the previous law would have allowed.

Though there was no public hearing on the stabilization fund change until after the votes, we made it clear with memos and lobbying that we considered it a tax increase -- *what else could it be?*

[ . . . ]

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The Boston Globe
Friday, March 20, 1998

A BOSTON GLOBE EDITORIAL

Finneran’s version of give-and-take

Anyone touting legislation as the biggest tax cut in state history had better make sure more than words ends up in people’s wallets.

House Speaker Thomas M. Finneran’s otherwise sensible plan to cut the state income tax will be tarnished if he insists on a little-advertised provision to increase the state reserve fund by an amount that could, in the first year, offset a significant part of his flaunted reduction.

As it now stands, if state revenues produce a large surplus at the end of the fiscal year in June, as anticipated, 40 percent will go to capital projects, $125 million will go to fill the reserve fund to its limit of $950 million, and most of the rest will be returned to taxpayers in the form of increased exemptions next year. This is not a vague political promise made during legislative debate. This is the law. It is also good tax policy, since the distribution would be progressive.

Finneran, however, included in his tax package an increase in the reserve fund limit of $500 million. This would reduce - or, if the surplus is high enough, cancel altogether - the benefit taxpayers would get from Finneran’s lowering of income tax rates. Potentially, at least, it sounds like a shell game, all the more so because Finneran kept the reserve fund change quiet when his proposal passed the House.
There are many uncertainties. The Massachusetts Taxpayers Foundation, for instance, is estimating a usable surplus of only $155 million - far less than the $675 million some have suggested.

While the state’s reserve fund is relatively high, Finneran’s desire to raise it even higher is worth an argument. But Finneran needs to make that argument openly, encouraging debate, not shrinking from it.

In the thriving Massachusetts economy, taxpayers deserve a reduction that is both reasonable and credible. Legislation that puts money in one pocket is no tax cut insofar as it takes the same amount from another.

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You can e-mail CLT&G at --> cltg@cltg.org
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