In The News

The Massachusetts Taxpayers Foundation wants Gov. Deval Patrick and State Legislators to cut hundreds of millions of dollars from the recently approved fiscal 2009 state budget to avoid what it said will be "an enormous threat" to state finances.

In an analysis released on Thursday, the MTF said it was worried the shortfall would affect Medicaid and ongoing efforts to expand health insurance coverage under the state's new law mandating coverage.

But while cutting wasteful government spending may be an admirable goal, Mike Widmer, Belmont Town Moderator and president of the Mass. Taxpayers' Association, said that is not what will happen if the income tax is repealed.

"Eliminating the income tax will have a dramatic impact on every program and service," he said. "Everything. Prisons, higher education, local education, human services, transportation and roads, infrastructure. Everything."

At the same time, Widmer said, towns would be forced to raise property taxes exponentially, and the repeal would probably result in a statewide property tax. The burden of that tax would fall disproportionably on the lower and middle-income residents.

"The income tax is much fairer than the property tax," he said. "The rate isn't graduated, but if someone makes more money, they pay more in taxes. They may have a more expensive home, but the property tax they would pay on it is nothing like what they pay in income taxes."

It's more than possible, said Michael Widmer, president of the Massachusetts Taxpayer Foundation. He estimates the budget is at least $1 billion out of balance. He worries the shaky economy, plus what he sees as rosy predictions about tax revenues, could make the gap even worse.

"It's a billion dollar problem, and that may be the best case," Widmer said.

"It's a very risky budget," said Michael J. Widmer, president of the Massachusetts Taxpayers Foundation, a business-funded budget watchdog group. "This is certainly the time when we should be limiting state spending to the absolute most essential items. It's one thing to add projects during a boom time. It's quite another when we're in fiscal peril."

But Michael Widmer of the Massachusetts Taxpayers Foundation estimated the budget already is $1 billion out of balance and urged Patrick to freely wield his veto pen.

Besides the $310 million spending from reserves, plus about $90 million in lost interest, Widmer said lawmakers underfunded major accounts, such as health care and snow and ice removal, by $400 million. He also said lawmakers overestimated business tax revenues by about $100 million and failed to account for a $100 million film tax credit.

"I think (lawmakers) are just hoping for the best, but I think it's a very risky course," Widmer said.

"'It's one thing to have it a few days late,' said Michael J. Widmer, president of the Massachusetts Taxpayers Foundation. 'It's another to have it several weeks or months late.'"

"Even if casinos arrive in Massachusetts, their revenue would likely cover only a quarter of what the Readiness agenda asks for, according to Michael J. Widmer, president of the Massachusetts Taxpayers Foundation. The state is already looking at a billion dollar deficit for fiscal 2009 (which starts Tuesday), he said. He hasn't priced out the Readiness agenda, but he estimated its cost at more than $1 billion."

"'The notion that somebody could be collecting a full salary and full retirement benefits really is an abuse and is very troubling,' said Michael Widmer, president of the Massachusetts Taxpayers Foundation. 'In effect, it is double dipping. It's this kind of practice that undercuts the public trust in government.'"

"A Massachusetts Taxpayers Foundation report in 2006 said that giving tuition breaks would not cost the state money but prompt hundreds of illegal immigrants to enroll in public higher education, earning the state millions of dollars in tuition."

"'This is going to get very difficult very fast,' Michael J. Widmer, president of the Massachusetts Taxpayers Foundation, told The Standard-Times.

"'It's clear we don't have the money to do this in the short term. Maybe we don't have the money to do this in the long term. It depends on how the economy performs over the next decade,' he said."