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MassCops Angel
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Discussion Starter · #1 ·
Governor Deval Patrick's administration is considering widespread emergency cuts in the state budget after tax collections plummeted by $200 million in the first two weeks of September, fueling fears of a deeper financial crisis as the nation's economic outlook worsens.
The precipitous drop puts the state's revenue far below what state officials had budgeted for this point in the fiscal year that began July 1, according to a Department of Revenue report. Moreover, officials expect the budget situation to worsen as the turmoil in the nation's financial markets weakens the economy, resulting in lower tax revenues for the state.
"The current economy and its impact on the state are going to complicate what's already been a challenging budget problem," said Leslie Kirwan, Patrick's secretary of administration and finance, who has grappled with consecutive $1 billion budget deficits. "We will be watching this very closely for the rest of the month."
The state anticipated it would collect about $1.1 billion in the first two weeks of September. Instead, it generated only $889 million, an 18.4 percent drop from the same period last year. Overall, budget officials hoped to end the month $80 million ahead of September 2007 collections, a threshold that now seems unreachable given the shaky economy.
The Revenue Department report attributed the drop to weak collections from payroll taxes, which were down $73 million, and anemic revenues from corporate business taxes. Those collections dropped $84 million from a year ago. The state also generates revenues from sales taxes, income taxes, capital gains taxes from investments, and other sources.
Kirwan said the numbers in the Department of Revenue report caused the administration this week to ask managers to comb their books to ensure that salary accounts are being kept level and that merit raises have been suspended.
The report indicated that collections could rebound in the latter weeks of September because the majority of revenue is processed at the end of the month.
But Kirwan said she expects that emergency budget cuts will be necessary and that Patrick would implement them throughout the executive branch in October. She added that it is impossible to know the size and focus of the cuts until the budget picture becomes clearer.
"We're going to take a hard look at everything," she said.
If revenues continue to decline, she said, the governor would seek expanded powers to spread the cuts across state government, to accounts that pay for everything from the judiciary to services in cities and towns.
Under state law, Patrick must get approval from the state Legislature to make cuts to accounts outside the executive branch. That power has not been granted since 2003, when former governor Mitt Romney implemented sweeping mid-year reductions in the face of a spiraling deficit.
Michael Widmer, president of the Massachusetts Taxpayers Foundation, said the state must make immediate spending reductions. "The September numbers are very sobering," he said.
He noted the numbers in the revenue report do not reflect capital gains taxes, which are expected to decline given the turbulence in the stock market. "The big hit is yet to strike," he said.
Top lawmakers declined comment on the budget outlook last night. However, Senate President Therese Murray, a Plymouth Democrat, has called for an unusual meeting on Monday to examine the state's finances. Expected to attend are Kirwan, state Treasurer Timothy P. Cahill, and budget leaders in the House and Senate.
Unlike the federal government, the state cannot run a deficit and must finish the fiscal year with a balanced budget.
Seeing signs of an economic slowdown, Patrick has been planning for the possibility of budget cuts for several months and has asked managers in all executive agencies to identify services that could be trimmed. He has also implemented restrictions on hiring and has cut spending on salaries and benefits for employees.
Compounding this year's problem is how much the federal government will reimburse the state for healthcare programs. The state had planned to receive $3.5 billion for this fiscal year, but negotiations have dragged on past the June 30 deadline. If federal aid falls short, that could force more budget cuts.
The state also faces rising costs associated with its universal healthcare law, which has led to higher-than-expected enrollment in state-funded insurance programs. Patrick proposed a plan to raise an additional $130 million from employers and insurers to help fund the new law.
State officials are also grappling with the impact of the stock market turmoil on the state's pension fund, which is down nearly 8 percent so far this year. That's far better than US stocks, which are down about 14 percent so far, but the fund typically has higher returns because of its diversified investment strategy.
Cahill noted the pension fund is not overly reliant on stocks.
"We're long-term investors, and I have confidence that we are well positioned to rebound," he said. "But it won't be a pretty year."

http://www.boston.com/business/arti...ck_ponders_big_cuts_as_state_revenue_tumbles/
 

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Super Moderator
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5,852 Posts
Watch your wallets....and your Quinn Bill. You know that's going to be next!
But as long as there is universal healthcare, that's OK :rolleyes:
 
G

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Get rid of details,the quinn bill, police training,the shannon grant, community policing and we can balance the state budget on the backs of police officers.
 
G

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Ladies and Gentlemen.... Fiscal Conservatism is DEAD. We can no longer look to State and Federal Government to be responsible. Please get involved in local politics... It's the last bastion of our founding fathers in this country...
 

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MassCops Angel
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121,497 Posts
Discussion Starter · #9 ·
Patrick readying budget cuts amid lagging revenues



BOSTON -- Gov. Deval Patrick is preparing to announce a series of budget cuts.
The state Department of Revenue is expected to announce Wednesday that tax collections fell behind expectations in September and for the first quarter of the fiscal year.
Treasurer Timothy Cahill says that with that information, Patrick will likely announce cuts in the budgets under his control, including the governor's office and the various secretariats in the Executive branch, including Economic Affairs, Public Safety and Energy.
Patrick also has met with the state's other constitutional officers and Margaret Marshall, chief of the Supreme Judicial Court.
While the governor cannot currently cut their budgets, he asked the Legislature earlier this year for expanded budgetary powers.

http://www1.whdh.com/news/articles/local/BO90001/
 

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Registered
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3,110 Posts
Its not total chaos yet. But its okay close a DMH facility so now we can have 1 public bed for 100,000! How about getting rid of crappy programs that go no where and help no one but the losers who can't help themselves.
 

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MassCops Angel
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121,497 Posts
Discussion Starter · #12 ·
State Cuts To Hit Pension System, Turnpike Auth.

Read: Governor's Release On Budget Cut Plan (pdf)


Read: Jon Keller's Political Blog


Gov. Deval Patrick is pushing a series of spending cuts and reforms after state revenues fell $223 million short of expectations in the first quarter.
WBZ

BOSTON (WBZ) ― Gov. Deval Patrick is pushing a series of spending cuts and reforms (pdf)-- including dismantling the Massachusetts Turnpike Authority -- after state revenues fell $223 million short of expectations in the first quarter.

The slowing economy will force officials to lower their estimate for expected revenue for the rest of this fiscal year.

Reducing the number will give Patrick the authority to make cuts across the executive branch. He's also asking lawmakers for the power to make cuts throughout the rest of state government.

Patrick says he'll also file legislation to dismantle the Turnpike Authority, restructure the Big Dig debt and consolidate other departments.

Part of his budget reduction plan includes reforming the State and MBTA pension systems.

In a joint statement released shortly after Patrick's announcement, Senate Pres. Therese Murray and House Speaker Salvatore DiMasi said they agree with Gov. Patrick that the state has to act now to deal with the effects of the economic downturn.

"The Legislature agrees with the governor on the need to make cuts now across state agencies under his statutory authority and we will cooperate in that effort and in our continuing efforts to find greater savings and efficiencies in state government."

In fact, instead of the 7 percent budget cut proposed by the governor, Murray and DiMasi say they'll go even further by reducing their budget for the 2009 fiscal year by 10 percent, which would send $9.1 million to the General Fund for other critical spending priorities.

Patrick said the cuts and consolidations are needed because revenues will likely continue to drop given the nation's ongoing economic crisis.

http://wbztv.com/local/state.budget.cuts.2.830758.html
 

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Needs more complaints
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just wondering how this will effect how you guys vote on Question 1?
It may sound good, but in reality local cities and towns rely on state tax because they get about 40-60% of services paid for by the state. Bonds, projects, grants, and direct funding sites rarely come from just city or town taxes. And if there's no state tax, plan on everything else going up. Property owners will take the biggest dicking because it's not a pay-per-use type of tax. Look at places that do not have state taxes, and ask them how their property taxes are...

The biggest problem is that this state's legislature treats people like cattle with $100 bills on their foreheads. They figure the more they have here the more revenue they can feed their projects. Here's a novel idea, how about making Massachusetts a financially attractive place to live, instead of driving people out of here.
 

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Retired Fed, Active Special
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Part of his budget reduction plan includes reforming the State and MBTA pension systems.

Yeah! that's the ticket, with that funky railroad retirement out of the way, The T-cops could join the MSP a Helluva lot easier...
Then again like Delta said, just eliminate the T-Cops. Would fill the future municpal slots with them. Oooops, with the economy the way it is, there won't be any future municipal slots. Oh wait, maybe we can give another police test and raise the fee to take it to $1000 and raise money that way!?

Taxachusetts, it just keeps getting better!:rolleyes:
 
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