In The News: Public Finance

"This puts the pressure on the Legislature, because if you don't get the new savings and the new revenues, you'll have to cut more deeply than the governor has in this budget," said Michael Widmer, president of the business-backed Massachusetts Taxpayers Foundation.

Springfield has $761.6 million in the unfunded liabilities, which translates to more than $12,000 in unfunded liabilities per single-family home; Holyoke would be on the hook for $300 million, which translates to a liability of more than $18,000 per single-family home. And eight other cities in the commonwealth are in similar straits. “It’s a classic problem of the public sector,” said Michael J. Widmer, Massachusetts Taxpayers Foundation president, “You vote for all these benefits knowing what the cost will be in the future. But of course, you’re not going to be in office by then.”

We reported on this a number of times in 2008, when Romney’s GOP primary opponents kept bringing it up. It’s true that the independent Massachusetts Taxpayers Foundation put the total of increased fees and corporate taxes under Romney at $740 million to $750 million per year.

Mike Widmer, president of the Massachusetts Tax Payers Foundation, recognizes that the current economic climate makes it challenging to address all of the State's needs in the current budget.

But Beacon Hill lawmakers in the past have rejected similar tax proposals from the governor. And Michael Widmer of the Massachusetts Taxpayers Foundation questioned whether they would accept them this time around. "Those tax proposals I think are reasonable but nonetheless this is an election year so there’s an open question on whether or not the legislature will approve them," he said. "So this puts the pressure on the Legislature because if you don’t achieve the new revenues then you have to cut more deeply than the governor has in this budget."

Michael Widmer, President of the Massachusetts Taxpayers Foundation, described the governor's budget as "fiscally responsible" but said it was built on "question marks" about health care savings and initiatives that lawmakers are unlikely to support.

The foundation, a Boston-based independent, nonprofit organization that conducts research on state and local taxes, government spending, and the economy, says the liabilities are not some hypothetical obligation but represent actual amounts taxpayers owe in today’s dollars for retiree health-care benefits already earned by current retirees and eligible employees and payable during the next 30 years.

“It’s going to be very tight,’’ said Michael J. Widmer, president of the Massachusetts Taxpayers Foundation. “There are going to be a number of places where there are budget cuts. “It’s better news than the last several years for sure, but it’s also a fifth consecutive year of budget squeeze,’’ he said. “This is the longest fiscal siege that state and local government have experienced in decades.’’

Michael Widmer, president of the independent Massachusetts Taxpayers Foundation, noted that lawmakers had previously rejected some of the governor’s revenue proposals and questioned whether they would be more willing to accept them this around. “The Legislature always puts its own imprint on the budget, but this year they are facing the same limited options the governor faces,’’ Widmer said.

Michael Widmer, the president of the Massachusetts Taxpayers Foundation predicts state budget writers will find a way to boost local aid.