The Beacon Hill Institute at Suffolk University, 2012

State Competitiveness Project

Back on top, Massachusetts ranks first in BHI measure of economic growth and income

BOSTON - (March 6, 2012) Massachusetts regained the top spot on the 11th Annual Beacon Hill Institute’s State Competitiveness Report. Last year the Bay State ranked third behind Colorado and North Dakota, which finished first last year. Longstanding strengths in human resources, technology and openness buoyed Massachusetts.

The BHI competitiveness index is based on a set of 44 indicators divided into eight
sub-indexes – government and fiscal policy, security, infrastructure, human resources, technology, business incubation, openness, and environmental policy. The breadth of the BHI index distinguishes it from more narrowly-focused measures of competitiveness that target only taxes, high tech, or economic freedom.

Massachusetts continues to show real strengths in its human resources (particularly with its top-scoring student achievement), technology (with its large base of scientists and engineers and high-tech employment) and business incubation, where Massachusetts draws the top ranking in terms of venture capital per capita. The state ranked first with the fewest number of residents going without health insurance. It is a favorite destination of National Institutes of Health grant money. Read More

Complete Report

Press release with 50-state rankings

Regulatory Studies

Real estate licensing rules do little to improve quality while restricting market competition to benefit full-time realtors

BOSTON - (February 1, 2012). The introduction of a continuing education requirement for a real estate agent in Massachusetts more than a decade ago did not improve the quality of service but rather limited the number of realtors according to a recent study by the Beacon Hill Institute at Suffolk University. Like most occupational licensing rules, the continuing education mandate limited the number of professionals and, in turn, hurt the consumer while enriching full-time realtors.

The study found that the requirement decreased the number of real estate agents by 58%. The requirement pushed part-time real estate agents out of the market, leaving more business for the remaining full-time agents. Those agents who remained in the market saw their incomes increase by 17%.

In 1999, the Massachusetts Association of Realtors urged the legislature to require all real estate agents to complete 12 hours of continuing education classes every two years as a condition for license renewal. Agents who failed to take the classes were placed on in-active lists and allowed only to make referrals to licensed agents. More.

Press Release (PDF)
Executive Summary (PDF)
Complete Study (PDF)

The Massachusetts Economy

BHI Forecast: State tax revenues to increase by 4.4% in FY 2012 and by 4.1% in FY 2013

(BOSTON, December 12, 2011) –The Beacon Hill Institute at Suffolk University (BHI) estimates that Massachusetts state tax revenues will come in at $21.411 billion for Fiscal Year 2012, for a growth of 4.4% over FY 2011. Revenues will be $22.287 billion for FY 2013, 4.1% above 2012.

David G. Tuerck, Executive Director of the Institute and Chairman of Economics at Suffolk University, and Paul Bachman, BHI Director of Research, will present the forecast in testimony before the Joint Committee on Ways and Means this morning at 11:00 a.m. in Gardner Auditorium at the Massachusetts State House. The legislature uses the BHI estimate to help determine the revenues needed for the upcoming state budget.

Total tax revenues grew by 4.7%, or by $356 million, for the first five months of the current fiscal year, compared to the same period last year. Sales tax revenues were relatively flat, growing by only 0.8%, while personal income tax revenues grew by 6.5%.

“After a strong rebound from the recession, state revenue collections are returning to more normal trends,” says Tuerck. “Tax revenues grew by 10.6% in Fiscal Year 2011, but the slowness with which the country as a whole is recovering from the recession made that growth unsustainable,” said Tuerck.

According to BHI projections for FY 2012, personal income tax revenues will grow by 5.4%, sales tax revenues by 1.9%, business excise tax revenues by 42.9% and motor fuel revenues by 0.2% over the previous year. Total taxes for FY 2013 will increase by $876 million over FY 2012.

Press Release (PDF)

Revenue Estimate FY 12- FY 13(PDF)

Tax Policy

BHI on the Federal Enterprise Value Tax on Investments

(BOSTON, MA) A proposed federal Enterprise Value Tax will double taxes on business partnerships in Massachusetts, adding $611 million to the state’s federal tax burden. As a result of the tax, the state will lose 5,400 jobs, $9.5 million in investment and $673 million in disposable income.

This is the finding of a new study, The Enterprise Value Tax: What it Means for the Massachusetts Economy, published today by the Beacon Hill Institute at Suffolk University and sponsored by the Massachusetts Chamber of Commerce.

The President’s Plan for Economic Growth and Deficit Reduction to the Joint Select Committee on Deficit Reduction contains a provision that would tax, as ordinary income rather than capital gains, the net proceeds fromthe sale of what is deemed an “investment services partnership interest”(ISPI). An ISPI is any interest in an investment partnership that is acquired by a person as a result of activities involving the purchase and sale of certain “specified assets,” defined to include partnership interests, securities and real estate holdings. More

Press Release (PDF)
Complete Study (PDF)

Health Care Reform and the Economy

HCR

Latest BHI Study: Massachusetts health care reform mandates invited gaming, costing taxpayers and ratepayers millions

(BOSTON, MA) Approximately 2,600 individuals in Massachusetts “gamed” the individual mandate at an estimated cost to insurance carriers of between $29.3 million and $37.3 million. This is one of the findings of a new report from the Beacon Hill Institute at Suffolk University, entitled, “The Massachusetts Health Care Reform Mandates: The Gaming Gamble.”

The study also found that the private insurance market only grew modestly and not enough to enroll all the newly-insured residents, suggesting that businesses may be dropping or declining coverage to offer insurance to their workers. More

Complete Study (PDF)

Press Release (PDF)

Romney Care: Good for Massachusetts?
The Cost of Romney Care in Massachusetts and Its Implications for Obama Care

A Presentation to the Northborough Tea Party, November 15, 2011

BHI Study: Massachusetts Health Care Reform drives up insurance costs both public and private

(BOSTON) The landmark Massachusetts Health Care Reform law is responsible for a dramatic increase in health care spending over the period since it was enacted. The law did not bring about a promised reduction in health care expenditures. Rather, it permitted the state legislature and governor to expand health insurance coverage to almost all residents, while imposing more than $8 billion in new health care costs to the federal government and on state residents and businesses.

Other studies have attempted to document the rise in health care costs attributable to Massachusetts Health Care Reform. The BHI study is the first to attempt a comprehensive examination of HCR’s impact on cost, taking into account the underlying trends in health care spending, as well as the effects of the law on federal Medicare spending. More

Complete Study (PDF)
Press Release (PDF)