- September 16 2010In a presentation to business and government leaders, MTF President Michael Widmer described the $2 to $2.5 billion budget gap facing the state in 2012, which will likely turn out to be the most difficult year of the state's extended fiscal crisis. Compounding this predicament, should voters approve the ballot question to cut the sales tax from 6.25 to 3 percent, the state would lose $2.5 billion in revenues raising the 2012 shortfall to nearly $5 billion.
- August 18 2010The Foundation calls on legislators and candidates to address the unsustainable increase in municipal costs of health care and pensions that are leading to layoffs of teachers, police and firefighters and recommends a series of changes that would save hundreds of millions of dollars annually in the short term growing to billions by 2020.
- August 16 2010In a newly released report, Maximizing the Value of Our Human Services Dollars, the Foundation makes two major recommendations: to streamline the administrative structure of the state's human services agencies; and to close ten antiquated and expensive institutions and move clients into community treatment. Both recommendations would save money while improving services for individuals and families. The link below is to the Executive Summary. The full report will be available shortly.
- June 9 2010In a letter to conferees, the Massachusetts Taxpayers Foundation urges legislators to reject the Senate proposal to address the issue of soaring municipal health care costs and take decisive action to provide municipal relief. Cities and towns should have unfettered powers over health plan design, consistent with the state, in order to protect municipal jobs and services.
- June 6 2010The Senate recommends spending $31.4 billion, roughly $250 million less than the Governor in fiscal 2011 but $100 million more than the House, and does not rely on a draw from the state stabilization fund or increased taxes. However, with roughly $2 billion of one-time funds in the budget, the 2012 structural deficit will require substantial cuts in spending, even with an economic recovery.
- March 24 2010MTF President Michael J. Widmer presented to the Boston Economic Club an update on state and local finances.
- March 17 2010
Controlling health care costs is a hugely complicated undertaking. In our collective frustration with the complexity of the challenge, let's not take actions that will only make the problem worse. Arbitrary price controls have a superficial appeal, but the economic and other consequences could be far-reaching and permanent.
- March 15 2010
Appearing before the Joint Committee on Public Service, MTF President Michael J. Widmer testified in support of the Governor's pension reform bill, which would save an estimated $2 billion over the next 30 years by making modest changes in the pension plan for state and local government employees in Massachusetts. Unless addressed, the escalating and unsustainable costs of pension and health benefits for public employees will lead to the layoffs of thousands of teachers, police, firefighters and other municipal employees across the state in the years ahead.
According to a recent report by the Pew Center on the States, Massachusetts is one of only eight states with more than one-third of its total pension liability unfunded. Many municipal pension plans are in even worse shape; roughly half of the 104 plans have lower funded ratios than the state, and 10 communities are funded below 50 percent.
As a result of the sharp decline in pension assets and the corresponding increase in unfunded liabilities, virtually every city and town is facing a large jump in pension payments in either their fiscal 2011 or 2012 budgets. To address this problem, the Legislature is considering a 10-year extension of the pension payment schedule for municipalities from 2030 to 2040. However, passing an extension of the payment schedule without key reforms that address costs will likely lead to a series of credit downgrades for many municipalities, exacerbating their already difficult financial conditions.
- March 1 2010
The Governor's reliance on more than $2 billion of one-time funds in his $31.7 billion fiscal 2011 budget will require major budget cuts in 2012. According to the Foundation's analysis, even if revenues grow by $1 billion in 2012, the state would still confront a $2.5 billion shortfall with virtually no state and federal reserves to help close the gap. In addition, should the voters this November approve a ballot initiative to reduce the state's sales tax from 6.25 to 3 percent, the state will face a $5 billion structural gap in fiscal 2012, as well as an immediate $1 billion revenue shortfall in fiscal 2011.