The Foundation produces a variety of publications, hosts periodic events and is frequently involved in newsworthy activities that affect public policy in Massachusetts. Our latest work as well as other news about the Foundation and important fiscal and economic issues are highlighted below.

January 2008

A variety of factors is placing ever greater pressure on the finances of most cities and towns with little relief in sight, according to the Massachusetts Taxpayers Foundation's 37th annual analysis of local revenues and spending.

The report highlighted several factors that are squeezing municipal finances, leading to a greater dependence on property taxes and/or to continued cuts in local services:
- limited increases in local aid for the foreseeable future;
- a slowly growing state lottery;
- escalating health care and other difficult-to-control costs;
- a weak economy that is producing only small increases in new growth;
- fewer and fewer communities with excess capacity;
- increasing voter reluctance to approve operating overrides.

The 2007 tax rates on pages 64-69 have been updated (see addendum).

December 2007

The Massachusetts Taxpayers Foundation has released an addendum to the 2007-2008 edition of its Massachusetts Legislative Directory. The addendum is available for download here. To obtain one free copy of the original directory, please send a self-addressed business-sized envelope with $1.00 postage. For information on how to obtain more than one copy, call the Foundation at (617) 720-1000.

Published biennially since 1973-1974, the Directory provides the names, addresses, telephone numbers and email addresses of state senators and representatives, the cities and towns they represent and committee assignments. The publication also features a glossary of legislative terms, a brief history of the Legislature and the names, addresses and telephone numbers of the state’s congressional delegation, principal constitutional officers and the Governor’s cabinet.

The Foundation gratefully acknowledges the generous support of State Street Corporation for underwriting the printing costs of the Directory.

December 2007

Testifying at the annual consensus revenue hearing on December 13, the Taxpayers Foundation projects that tax revenue will grow better than expected in fiscal 2008 but increase only marginally in 2009.

According to the MTF forecast, fiscal 2008 tax revenues will total $20.620 billion, an increase of 4.5 percent over 2007 and about $400 million higher than the forecast released by the Patrick administration in October. However, tax revenues will grow by only 2.4 percent or $500 million in fiscal 2009 to a total of $21.12 billion, according to the forecast.

Driven by large increases in corporate taxes and capital gains, tax revenues grew by an average of 7.2 percent a year between 2003 and 2007, despite the underlying weak Massachusetts economy. The Foundation forecasts that corporate taxes will decline slightly in both fiscal 2008 and 2009 while capital gains will rise another 10 percent in 2008 but drop about 5 percent in 2009.

The Foundation's projections are based on a weakening national economy, though not a recession, caused by the housing and credit crunch and record high oil prices. The Foundation forecasts limited job growth for Massachusetts over the next 18 months.

The annual hearing was convened by the chairs of the House and Senate Ways and Means Committees and the Secretary of Administration and Finance, who will work together to agree on a "consensus" revenue estimate for the fiscal 2009 budget.

December 2007

Massachusetts employers will spend an estimated $175 million a year for additional employee coverage under the state's health care reform law, according to the Foundation's major new report, which analyzes the broad scope of employer participation that is critical to the success of Massachusetts health care reform.

The report finds that employers will contribute to the state's goal of nearly universal coverage by:
• increasing their health care spending by $150 million a year as more employees accept coverage;
• spending an additional $24 million a year to offer employees new prescription drug benefits;
• greatly expanding the availability of pre-tax premium payments for employees; and
• broadening their support for the funding of uncompensated care.

October 2007

On October 25 the Foundation released a report analyzing the revenue projections included in the administration's plan to license three casinos in Massachusetts. The detailed analysis concludes that revenues generated for property tax relief and road and bridge repair would be significantly less than the $400 million figure touted by the administration.

The Foundation’s conclusions are summarized in Table 1 which presents the Governor’s estimates as well as a forecast from Dr. Barrow’s blueprint presented to the administration. They differ in the amount of gross gaming revenues from three casinos and the resulting balance of funds available for property tax credits and transportation investments.

The Governor’s plan anticipates $2.05 billion in gross gaming revenues which would generate $544 in revenues to the state annually. After deducting funds for the three areas of mitigation included in the Governor’s proposal – 2.5 percent of gross gaming revenues for both host communities and public health as well as holding the Lottery harmless – there would be an estimated $308 million for property tax credits and transportation funding.

Dr. Barrow’s forecast of $1.5 billion in gross gaming revenues would generate $405 million in annual revenues but only $186 million in net proceeds after funding the mitigation requirements.

August 2007

Cities and towns across the Commonwealth can save as much as $750 million in 2013 and $2.5 billion in 2018 by taking advantage of a new law that allows them to join the Group Insurance Commission (GIC), the state agency which administers health insurance for state employees, according to a joint report by the Foundation and the Boston Municipal Research Bureau. The report is the first ever to quantify the potential savings in joining the GIC.

The estimated savings are based on an analysis of the comparative rates of growth of actual municipal and GIC health insurance costs between fiscal 2001 and 2006 projected through fiscal 2018. The study also calculates savings through a second, more conservative scenario. Key findings:

* Savings of between $61 million and $102 million could be achieved in fiscal 2009, between $436 million and $764 million in fiscal 2013, and between $1.4 billion and $2.5 billion in fiscal 2018.

* Health care costs would make up an estimated 19 to 23 percent of municipal budgets in fiscal 2018 if municipalities do not join the GIC, compared to 15 percent in 2018 if all municipalities join the GIC and 10 percent of municipal budgets today.

* Health care costs would consume an estimated 30 to 36 percent of property tax revenues in fiscal 2018 if municipalities do not join the GIC, compared to 23 percent in 2018 if all municipalities join the GIC and 19 percent of property tax revenues today.

The report urges policymakers to determine whether the legislation needs to be strengthened to allow more municipalities to benefit from participation in the GIC. If too few communities are able to negotiate entry while health insurance costs continue their rapid growth, the report recommends eliminating the coalition bargaining process as a requirement to join the GIC.

June 2007

May 2007

April 2007

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April 2007

Stan Lukowski, Chairman Emeritus of Eastern Bank, was re-elected Chair of the Massachusetts Taxpayers Foundation at the organization’s 74th Annual Meeting on March 20. Mr. Lukowski, who has been a member of the Foundation’s Executive Committee since 2004, will serve the second year of his two-year term.

Other officers elected at the Annual Meeting were Sandra Fenwick, Chief Operating Officer of Children's Hospital, and Ted Ladd, Chairman Emeritus of Standish Mellon Asset Management LLC, as Vice Chairs and Christopher Mansfield, Senior Vice President, General Counsel of Liberty Mutual, as Treasurer. Members of the Foundation also elected 32 Trustees to serve three-year terms on the 70-member Board of Trustees as well as 19 Executive Committee members.

April 2007

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January 2007

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November 2006

September 2006

Despite the better-than-expected revenue performance in fiscal 2006, the state’s leaders will soon have to grapple with a large and rapidly growing disparity between available resources and the costs of a broad array of important priorities, according the Foundation's major new analysis of the state's finances over the next five years. Dealing with this challenge is likely to dominate the financial decision making of the next Governor and Legislature for the foreseeable future.

The mismatch between expected revenues – and the costs of widely held goals such as greater local aid, additional spending for higher education, and increased capital investment – is staggering. Even with careful targeting on only those priorities of greatest importance for the long-term health of the Massachusetts economy, their costs are likely to exceed available resources by billions of dollars, the analysis concludes. Contrary to the common belief that the Commonwealth can finance its unmet needs through economic growth, addressing any substantial portion of these spending ambitions would push the state budget deeply into deficit under any reasonable set of assumptions about future tax receipts and spending growth.

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August 2006

The Foundation recently won the Governmental Research Association's (GRA) 2006 Award for Outstanding Policy Achievement for its vital role in passage of the state's landmark health care reform.

The Foundation was recognized for its broad contributions, in particular, forging the compromise between the House and Senate leadership which led to the final legislation, as well as its detailed and accurate analysis of the finances of health care reform. A centerpiece of the Foundation's work was its December 2005 report, Health Care Reform: Expanding Access Without Sacrificing Jobs, authored by Victoria Burgess and Cam Huff.

The GRA is comprised of state and local public policy organizations from across the country. Over the past decade, the Foundation has been honored with ten awards and two certificates of merit from the GRA, an unprecedented achievement.

August 2006

June 2006

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April 2006

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January 2006

December 2005

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November 2005

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October 2005

The Foundation has received the 2005 award for “Most Effective Education” from the national Governmental Research Association (GRA). The Foundation’s entry, “Confronting the New Fiscal Challenge: Budget Deficits in a Period of Economic Recovery,” was recognized for its series of recent reports, legislative briefings, and subsequent media coverage that have highlighted the state’s long-term fiscal problems. Cam Huff deserves the lion’s share of the credit for the award.

The Foundation also won a certificate of merit for “Outstanding Policy Achievement” for our report, “Reforming the Commonwealth’s $2 Billion Purchase of Human Services: Meeting the Promise for Clients and Taxpayers,” which was authored by Glen Tepke.

Over the past decade the Foundation has been honored with nine awards and two certificates of merit from the GRA, an unprecedented achievement.

July 2005

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June 2005

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May 2005

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