Representative Rogers writes about the Governor’s proposed tax plan

The following piece was published in various publications on February 28th, 2013:

 

Our state is at a crossroads. Governor Patrick has proposed that we meet our challenges with his most ambitious policy recommendations to date.  His plan overhauls our transportation and infrastructure systems and makes key investments in education. To fund his plan, the Governor has called for major tax reform that dramatically cuts the sales tax (6.25% to 4.5%), increases the income tax (5.25% to 6.25%), doubles the personal exemption from $4,400 to $8,800, and eliminates 44 tax credits, deductions, and exemptions. Collectively, these changes increase state revenue by $1.9 billion.

Transportation: Whether it is the Red Line, bus routes, the commuter rail, or bike paths and walking routes, Belmont relies heavily on public transportation.  Modernizing our transportation system would be a major step in addressing economic development, climate change, and the quality of our lives, but solving the transportation riddle has vexed lawmakers for years.  Over many years ridership of the T has grown by over 300% and the system has fallen into disrepair. The MBTA is over $5 billion in debt, an onerous financial burden preventing the system from making necessary upgrades. The result has been increased delays and/or breakdowns that seem to occur on a daily basis.  In proposing major investment in transportation, the Governor enjoys support from leaders in the Greater Boston area business community who know a well functioning transportation system is vitally important to economic growth.

While we are still early in the process, I am encouraged by the scale of the Governor’s plan.  His proposal makes a ten-year investment in transportation and infrastructure by dedicating all sales tax receipts to their improvement.  The plan allocates over $2 billion to purchase new rail cars for the Red, Green, and Orange lines. It also will provide resources to replace older buses. It invests in the MBTA’s electrical service, track, and tunnels, preventing dreaded breakdowns.  More money will be provided for our roads under Chapter 90 funding (local aid sent to cities and towns for road upkeep). Finally, the Governor’s plan funds bicycle and pedestrian facilities owned and managed by MassDOT and DCR.

Education: The Governor has proposed new education investments at every level of study.  His plan calls for a $550 million increase for the coming year and increases Chapter 70 funding (local aid for K-12 education) by $226 Million.  More state aid for schools cannot come soon enough.  At a recent joint meeting of the Belmont Selectmen and School Committee, this years’s funding gap for Belmont schools was pegged at around $6 million.  These shortfalls are becoming the norm rather than the exception.  The Governor’s plan also funds early childhood education programs (aimed at closing the achievement gap) and expands funding for public higher education.

The Tax Plan: The Governor’s plan to reform the tax code has been poorly explained to the public.  The media has emphasized proposed changes in sales and income tax rates.  While changes to rates catch the eye, of the $1.9 billion raised by the plan, only around $110 million comes from these tax rate changes. The majority of revenue comes from eliminating credits, deductions and exemptions while raising tobacco and corporate taxes.

Had I been in the Legislature in 2008/2009 during the depths of recession, I would not have supported any increase in taxes.  Even just 12-18 months ago I would have been resistant to the idea. Now however, our state (and our region particularly) has begun to turn the corner. For instance, Belmont real estate values are up and houses are selling faster.  Massachusetts has the highest bond rating in its history, an unemployment rate well below the national average, and stock markets are enjoying strong growth. I believe now is the time to invest, bringing our transportation network into the 21st century and putting our schools on sound financial footing.  Such investments require that we have a serious conversation about raising revenue. If it has done nothing else, the Governor’s plan has done a public service by framing the key issues we face and encouraging discussion.

To be clear, I am not endorsing all aspects of the Governor’s plan and it does not cover the full range of possibilities.  To name one example, many in our community favor a gas tax that raises revenue while acting as a disincentive to drive.  I also listen carefully to voices in our community that would like to see greater reform of state government to eliminate poor policy choices and combat waste and inefficiency. I will always be an advocate for the judicious use of tax dollars. All of us need to keep in mind however that state government has undertaken many significant reforms in the last 5 or 6 years that will save money.  There has been substantial pension reform legislation; municipal health reform; and major health care cost containment legislation. Later this year, the Legislature will likely pass changes to retiree health care benefits. Taken together, over time these reforms will save Massachusetts taxpayers many billions.

The Legislature is just now taking up the Governor’s proposals and developing its own plan. There will be careful analysis coupled with spirited debate.  As the debate evolves, I hope to hear from you and together we will face the challenges and explore the opportunities before us.

Tagged with: ,
Posted in Arlington, Belmont, Cambridge, Dave in the Media, Op Eds, The District

Leave a Reply

Your email address will not be published. Required fields are marked *

*

Subscribe to my monthly email newsletter

* indicates required
Contact Dave

Please never hesitate to contact me for any reason.

Phone: 617-722-2637
Email: dave.rogers@mahouse.gov
Mail: State House Room 544, Boston, MA 02133