By Joe Markman
Local officials found themselves backed against a wall of limited revenue options when, in January, Gov. Deval Patrick announced local aid cuts of $128 million this year and $375 million in 2010 to help make up for billions of dollars in state deficits.
The move revised a long simmering debate. Does the following sound familiar?
“There are only two ways that cities and towns can deal with local aid cuts. One is to raise property taxes even more. The other is to cut essential services, since that’s where most of the money is spent.”
The Massachusetts Municipal Association said this back in 2003, when former Gov. Mitt Romney cut local aid by $114 million – the largest local aid reduction in state history until this year according to the association.
Next year’s $375 million reduction will be more than three times the Romney cut, unless lawmakers work quickly (which they seem loathe to do) to give municipalities much needed revenue streams beyond property taxes (around which they tread lightly because of tax-averse voters).
Legislators should strongly consider the long-term alternatives the MMA and Patrick have suggested, unless, of course, they believe this is the last economic downturn Massachusetts will ever face.
“Unfortunately, taxes are on the table,” said Geoff Beckwith, MMA’s executive director, back in February. “Right now, cities and towns have the property tax, and we need to have other options that are fairer.”
Such alternatives include local-option meal and hotel levies and taxes on telecommunication properties.
Massachusetts towns should not be surprised by the cuts. When there is an economic downturn, the state government undoubtedly turns to local aid reductions to address deficits.
In 1992, as the country was recovering from a recession, Weymouth residents were forced to deal with $600,000 in local aid cuts by then Gov. William Weld. The town decided to defer payments to its pension fund to make up for the reductions.
This year, Weymouth lost $1 million, which it covered with the proceeds from selling an unused elementary school building. Next year a $3.6 million reduction means the town faces layoffs and hiring and wage freezes.
Yet even as towns have faced local aid cuts again and again, their options remain limited because of voter distaste for taxes.
A recent Suffolk University-7News poll shows that 32 percent of voters sampled support an increase in the sales tax to help solve the state's fiscal crisis, with 20 percent supporting a hike in the gas tax, and 12 percent favoring raising the state income tax.
With such low public support for higher taxes, state legislators face an uphill battle to give towns more options. Even an increased hotels and meals tax – which represents an extra 10 cents on a $10 lunch bill – has faced strong opposition from taxpayers and those in the hospitality industry.
“Our industry, not unlike the automobile industry, is reeling from the economic downturn,” Peter Christie, chief executive officer of the Massachusetts Restaurant Association said in response to Patrick’s proposal to add one penny to both the 5 percent meals and 5.75 percent hotels taxes.
“Would anyone suggest targeting automobiles for a local tax? Of course not, but that is exactly what the administration is suggesting to us,” Christie said.
Rep. Jay Kaufman, D-Lexington, House chair of the Joint Committee on Revenue, told reporters recently that “there is no topic off-limits” in seminars on the state’s tax policy.
That includes, he said, Proposition 2 ½, which limits the total taxes that can be assessed every year on the real and personal property of each municipality to not more than 2 ½ percent of the “full and fair” cash value of the property.
Kaufman, wisely understanding that a rough economy calls for fresh alternatives, has opened a needed discussion about allowing towns to increase revenue through property taxes.
In addition, Kaufman said the committee will consider Patrick’s re-filed state and local options taxes on meals and hotel rooms, and telecommunications levy, proposals that failed to advance last session.
Patrick had said that a statewide 1 percent increase on the meals and lodging taxes would raise about $150 million, to be distributed to towns and cities in the same way as lottery aid. He also said the local taxes, including telecommunications revenues, would be worth another $150 million.
“Maybe it will save one position, and that’s worth it,” said Stoughton Selectman Joseph M. Mokrisky in response to the governor’s proposal in January.
State elected officials are put into office by the voters to create policy based on the best interests of the state, and, in effect, each town and city in Massachusetts. Tough decisions are part of their job. So while voters may balk at tax increases, legislators must use the power given to them, deliberatively and logically, to mitigate cuts to core town services.
Tuesday, March 31, 2009
Monday, March 30, 2009
An ethical dilemma
An ethical dilemma
3/21/09
By: Jack Nicas
The new two-year legislative session began in January. With it came a $1 billion midyear budget gap and a looming $4 billion deficit for next year.
But on the first day of the new session, Gov. Deval Patrick announced a sweeping ethics reform package in response to last session’s scandals.
(Two members of the 40-seat Senate were indicted last fall. Dianne Wilkerson allegedly accepted bribes and James Marzilli sought extra pension after allegedly groping a woman in a park.)
“The actions of a few have cast a cloud over all,” Patrick said when announcing his first bill of the session. “But we can ensure ourselves and the public that the consequences for breaching the public trust will be serious, swift, and certain.”
He called for legislative action within 30 days—the House passed its version of the bill Thursday, 49 days past Patrick’s deadline.
But the governor’s statements support what his immediate filing of the bill suggests: that ethics reform is largely a PR campaign.
In fact, ethics reform is in vogue. Seemingly every lawmaker is eager to sign on to this season’s trendiest bill.
House Speaker Robert DeLeo named it his prime concern in his inaugural address as speaker Jan. 28. Three days earlier, former speaker Salvatore DiMasi resigned from the post under the proverbial cloud Patrick mentioned.
(DiMasi’s former accountant, an unregistered lobbyist, allegedly paid for the speaker’s in-laws’ legal fees.)
Earlier this month, DeLeo reiterated the need for reform and why.
“We have to regain the public trust, and I think the way we regain that is through addressing [ethics and pensions reform],” he said at a luncheon discussion. “It’s important that we do something, and we do something as quickly as we can.” These comments came a month after Patrick’s call-to-action deadline passed.
At the first committee hearing on the bill, Committee Co-chair Sen. Brian Joyce said, “This is critically important to all of us. From the Senate president to the speaker—and every single elected official in this building—because a few of our former colleagues frankly stained us all.”
Judging from the Statehouse’s continued rhetoric, it seems legislators are employing the looking glass theory: I am what I think you think I am. As if the ethicality of the Statehouse is only determined through the eyes of the public. (Never mind the Legislature’s actual conduct.)
Maybe that’s why the charade has continued on for so long; lawmakers have had plenty of time to discuss the importance of ethics reform without taking action. The bill now sits in the Senate nearly three months after its filing. (Patrick wanted it a law by day 30.)
But as a bipartisan issue, is such a delay necessary? Not one lawmaker has publicly dissented.
House Minority Leader Bradley Jones believes the bill has been ripe for picking. “We should wipe out some of the low-hanging fruit, like ethics reform, and build some good will with the public,” he said last month.
And Rep. James Fagan, former chair of a temporary committee created to take swift action on the bill, agreed the fruit hung so low, the Legislature could already reach it.
The legislation contains “a large number of common sense, very doable ideas,” he said. His committee was later dissolved without taking action.
But despite the bill’s championed logic, legislators have been overly skeptical when actually handling it.
At the bill’s first hearing, Rep. Steven Walsh worried more lobbyist-registering mandates would have a “chilling effect” on members of state boards. Sen. Anthony Galluccio feared potential legal fees from more ethics investigations would discourage runs for office.
This undue caution usually emerges on bills that affect the Legislature and not the public.
Notwithstanding some lawmakers’ hypothetical situations, state officials’ testimony revealed the genuine need for reform.
Secretary of State William Galvin called his tools to enforce lobbyist registering “crude.”
“We basically proceed right now by the honors system,” he said.
And in investigations outside of Suffolk County, the attorney general must share the county district attorney’s grand jury system.
Those bodies sit for only three months, while “a statewide grand jury can sit for a period of up to 18 months, which is much more in line with how long corruption investigations typically take,” said Patrick’s chief legal counsel Ben Clements.
Patrick’s bill establishes a statewide grand jury system.
It also authorizes the attorney general to record phone calls with one-party consent and judicial approval. The House version of the bill has since removed this provision.
“[Patrick’s bill] is simply the common-sense mechanism to enhance the efficiency of investigations,” Clements said.
But the bill must first travel through the Legislature; and unfortunately common sense and enhanced efficiency are not part of its repertoire.
3/21/09
By: Jack Nicas
The new two-year legislative session began in January. With it came a $1 billion midyear budget gap and a looming $4 billion deficit for next year.
But on the first day of the new session, Gov. Deval Patrick announced a sweeping ethics reform package in response to last session’s scandals.
(Two members of the 40-seat Senate were indicted last fall. Dianne Wilkerson allegedly accepted bribes and James Marzilli sought extra pension after allegedly groping a woman in a park.)
“The actions of a few have cast a cloud over all,” Patrick said when announcing his first bill of the session. “But we can ensure ourselves and the public that the consequences for breaching the public trust will be serious, swift, and certain.”
He called for legislative action within 30 days—the House passed its version of the bill Thursday, 49 days past Patrick’s deadline.
But the governor’s statements support what his immediate filing of the bill suggests: that ethics reform is largely a PR campaign.
In fact, ethics reform is in vogue. Seemingly every lawmaker is eager to sign on to this season’s trendiest bill.
House Speaker Robert DeLeo named it his prime concern in his inaugural address as speaker Jan. 28. Three days earlier, former speaker Salvatore DiMasi resigned from the post under the proverbial cloud Patrick mentioned.
(DiMasi’s former accountant, an unregistered lobbyist, allegedly paid for the speaker’s in-laws’ legal fees.)
Earlier this month, DeLeo reiterated the need for reform and why.
“We have to regain the public trust, and I think the way we regain that is through addressing [ethics and pensions reform],” he said at a luncheon discussion. “It’s important that we do something, and we do something as quickly as we can.” These comments came a month after Patrick’s call-to-action deadline passed.
At the first committee hearing on the bill, Committee Co-chair Sen. Brian Joyce said, “This is critically important to all of us. From the Senate president to the speaker—and every single elected official in this building—because a few of our former colleagues frankly stained us all.”
Judging from the Statehouse’s continued rhetoric, it seems legislators are employing the looking glass theory: I am what I think you think I am. As if the ethicality of the Statehouse is only determined through the eyes of the public. (Never mind the Legislature’s actual conduct.)
Maybe that’s why the charade has continued on for so long; lawmakers have had plenty of time to discuss the importance of ethics reform without taking action. The bill now sits in the Senate nearly three months after its filing. (Patrick wanted it a law by day 30.)
But as a bipartisan issue, is such a delay necessary? Not one lawmaker has publicly dissented.
House Minority Leader Bradley Jones believes the bill has been ripe for picking. “We should wipe out some of the low-hanging fruit, like ethics reform, and build some good will with the public,” he said last month.
And Rep. James Fagan, former chair of a temporary committee created to take swift action on the bill, agreed the fruit hung so low, the Legislature could already reach it.
The legislation contains “a large number of common sense, very doable ideas,” he said. His committee was later dissolved without taking action.
But despite the bill’s championed logic, legislators have been overly skeptical when actually handling it.
At the bill’s first hearing, Rep. Steven Walsh worried more lobbyist-registering mandates would have a “chilling effect” on members of state boards. Sen. Anthony Galluccio feared potential legal fees from more ethics investigations would discourage runs for office.
This undue caution usually emerges on bills that affect the Legislature and not the public.
Notwithstanding some lawmakers’ hypothetical situations, state officials’ testimony revealed the genuine need for reform.
Secretary of State William Galvin called his tools to enforce lobbyist registering “crude.”
“We basically proceed right now by the honors system,” he said.
And in investigations outside of Suffolk County, the attorney general must share the county district attorney’s grand jury system.
Those bodies sit for only three months, while “a statewide grand jury can sit for a period of up to 18 months, which is much more in line with how long corruption investigations typically take,” said Patrick’s chief legal counsel Ben Clements.
Patrick’s bill establishes a statewide grand jury system.
It also authorizes the attorney general to record phone calls with one-party consent and judicial approval. The House version of the bill has since removed this provision.
“[Patrick’s bill] is simply the common-sense mechanism to enhance the efficiency of investigations,” Clements said.
But the bill must first travel through the Legislature; and unfortunately common sense and enhanced efficiency are not part of its repertoire.
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