Analysis: Mass. FY2016 Budget Winners & Losers (but of What?)…
On balance the budget passed by the legislature and under review by Governor Charlie Baker is not bad. Like many a budget, it includes goodies for members, some substantive, others less so. One non-politician political winner is the poor, who saw the Earned Income Tax Credit bolstered. The clear political winner is Baker, even though it is possible little will change or happen as a result.
Baker got his suspension of the Pacheco Law, which requires public agencies to justify savings before privatizing government services, for the Massachusetts Bay Transit Authority. He shared a second victory with House Speaker Robert DeLeo, who slew the Senate’s proposed income tax freeze as a means to finance the EITC.
There is little controversy in this budget and after last fiscal year’s roller coaster, legislators can be forgiven for actively avoiding any.
Western Massachusetts’s bounty included parks and recreation funds for the region and repairs to an out-of-commission bridge connecting Ludlow and Wilbraham. There was some substantive policy, too.
— Eric Lesser (@EricLesser) July 11, 2015
Freshman Senator Eric Lesser top policy objectives on the opiate crisis made the cut in the form of a crackdown on pharmacy shopping and greater availability of anti-overdose medication naloxone (Narcan). An amendment of his that would order a study of Boston-Springfield rail service was not in the final budget. His bill to the same effect remains alive and pending before the Transportation Committee.
In the short-term, the decision to use a business tax break—apparently to the relative surprise of the business community—to finance the EITC, is a net win for the working poor. But now the income tax remains free to ratchet down until it hits 5% (presently it is 5.15%), saving individuals a fraction of a pittance while costing the commonwealth real money better spent on local aid, roads or education.
The Senate voted to stop this needless bloodletting, a relic from a since tweaked 2000 referendum obviated by not one, but two recessions. The House and governor refused. The former’s decision is no surprise given the fear political distortion artists like Mass Fiscal, have instilled in pols, especially reps.
Baker’s resistance fits his party, but not his biggest selling point: knowing how to run things. With healthcare costs going up and question marks around casino income multiplying, it might seem prudent for an executive who campaigned as if he wrote Zen & the Art of Management to hit the pause button and stabilize the tax rate.
Like many pols, Baker likes to trot out how the 5% rate is the voters’ will, but their will mattered less last year when he proposed overturning casino repeal should it pass. It failed, but that does not undo the hypocrisy of using an old ballot question as a shield against common sense present day budgeting.
The governor’s successful suspension of the Pacheco law may also prove a fleeting victory. While Baker “won” politically, all the legislature did was split the baby.
After the MBTA’s wintry disaster, lawmakers really want no part of a fix—especially if it does not work—unless absolutely necessary, so they gave Baker a little latitude. As Massterlist observed Wednesday, a three-year suspension may prove too short a time period for private firms to seriously consider.
Nobody but the most ardent leftists oppose privatization completely. The Pacheco law asks for more than caprice before doing so. Suspending or ending it, as its namesake contended, could put middle class job security at risk. The MBTA’s labor unions, who opposed the suspension, certainly had a hand in the T’s dysfunction, but that is quite separate from the state’s standard on whether it or a contractor performs a service.
The upshot is Baker’s popularity endures for now. Arguably the stage is set for him to prove his managing prowess is more than rhetorical flourish, but only by so much. In the end, he and legislature may only have kicked the can down the road until the day of reckoning…or at least next year’s budget.