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from NewsLink, Vol. 4, No. 1, Fall 1999
To all of you who attended BHI's Dinner to Celebrate the Life and Legacy of Ray Shamie, thank you for your support. Ray Shamie, BHI's founder and senior advisor, died last June. The dinner not only remembered Ray but also inaugurated our Ray Shamie Center for Civic Enterprise. For more on the dinner, please see "Dinner celebrates the life and legacy of Ray Shamie."
The Commonwealth's $20.6 billion budget
On November 16, Governor Cellucci signed Massachusetts' FY 2000 budget. Included in the budget is a modest reduction in the personal income tax rate from 5.95% to 5.75%, to be phased-in over a three-year period. While this is a step in the right direction, we applaud the Governor for his tenacity in pushing for a reduction in the income tax rate to 5%. Voters may have an opportunity to make this a reality at the polls in November 2000. We look forward to taking an active role in the debate over the tax cut in the New Year. Our analysis shows that the 5% tax cut will exert five times more powerful a stimulus to the Massachusetts economy than the 5.75% tax cut. That makes it a win/win for taxpayers and for the economy.
Capital gains rate sustained
The legislature did not override Governor Cellucci's veto of a law that would have increased the tax on long-term capital gains. A June 1999 BHI FaxSheet, “Capital Gains Hike Would Hurt Low-Income Taxpayers Most” showed, as the title suggests, that this law would have been most harmful to low-income taxpayers and that it would have cost the state $921 million in capital spending by 2002.
Howard Foley, Executive Director of the Massachusetts High Technology Council, wrote in November to thank us for our work on this important issue. He said, “Your report highlighting the most recent data available regarding how many Massachusetts taxpayers would be affected by this change, and the fact that 45% had adjusted gross incomes of $50,000 or less, was a key point I was able to use during my lobbying efforts.”
Forward funding fact: facing a fare increase
Last May, BHI issued a study about the MBTA in which we recommended ways to improve efficiencies as well as proposed a doubling of fares. This November the state legislature approved a long-standing "forward-funding" plan. (See page 6.) Even though this isn't what we recommended, we understand that it is well-intended. But we'll say it again. The legislature can make a difference in controlling the MBTA's costs only if it adopts a fare increase.
Thanks again!
We can't say it enough. Our efforts depend on the generosity of our donors. To all of you, thank you for your confidence and for helping to make our work in 1999 possible.
NewsLink is the quarterly newsletter of the Beacon Hill Institute for Public Policy Research at Suffolk University. © 1996-2002. All rights reserved.
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