State Budget Cuts Coming

The Governor last week, in light of poor tax collection data, has been forced to once again downgrade state revenue estimates, calling for a $600 million dollar budget reduction in order to achieve balance at the lower number. He will ask for additional 9-C authority, and has warned that wage concessions will be needed from state unions in order to avoid large layoffs.

The Globe story also detailed the potential for hikes in employee costs within the State G.I.C. health care program. From the Globe:

Besides layoffs and furloughs, employees could feel the brunt of the budget crisis in other ways. The head of the state’s Group Insurance Commission, which oversees employee health benefits, said yesterday the agency will consider raising copayments for doctor’s visits, deductibles, or premiums.

“A person would have to be naive not to realize we all have to take a look at our budgets and see what we might have to do,’’ said Dolores Mitchell, the commission’s executive director, who sent a letter to the commissioners this week detailing possible changes. “When the Commonwealth is facing this kind of budget crunch, everything is on the table.’’

Interesting point by Dolores Mitchell, who is absolutely right. You would have to be naive not to realize that everything is on the table. There must be plenty of naive people out in Boston however, because cities and towns are currently not able to look at such actions due to state law. As the budget noose tightens on cities and towns real reforms are indeed needed, including health care and pension reform right at the top of the list. Senator Richard Tisei, Republican Leader, was critical of the Administration.

Senate Minority Leader Richard Tisei said the administration has taken way too long to confront the state’s worsening budget crisis.

“Basic things like a hiring freeze or a wage freeze, or repeal of the antiprivatizing laws – those would save taxpayers hundreds of millions of dollars,’’ Tisei said. “We’re always behind the eight ball on the budget crisis and can’t get ahead of it. It’s clear from listening to the governor that not only do we have a revenue problem, but we have a management problem in the state.’’

My own thought has been that for two years running the State has consistently over estimated revenue in its budget. No question that it is an inexact science, but there is really no reason for repeatedly missing the mark. The estimates need to be in line with the most conservative estimates, and pain imposed at the BEGINING of fiscal cycles, where proper planning can be done. The Commonwealth has missed the mark on this, and missed it quite badly.

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1 Response to State Budget Cuts Coming

  1. Jules Gordon says:

    Your Honor,
    Are we in a deja vu moment here? I could not suppress a chuckle at the video title, “Governor Patrick’s Plan to Close Budget Gap”, as think of it as an ongoing soap opera. I call it the ‘Governor’s Promises’.

    I noted in juxtaposition with your own statement from above, “My own thought has been that for two years running the State has consistently over estimated revenue in its budget. No question that it is an inexact science, but there is really no reason for repeatedly missing the mark.” with the Governor beginning his video announcement “Despite the best forecast….”, in which, your honor, he admits he can do no better.

    Thus we will revisit this problem again.

    The good news for all of us is that (quoting Ron Emanuel) we should ‘not waist a crisis’. Now you have to push for basic changes that have given protected privileged to a few and eliminate those statutes that will allow you to manage the town properly. Then when the next crisis occurs (about a month from now) you will have more effective tools to properly manage things.

    How about starting a petition drive to the legislature. How about a tea party at the steps of the golden dome?

    Will the savings derived from the Transportation ‘reform’ along with those from the flagman ‘reform’ cover the short fall?

    I assume this means our promised real estate tax cut will not come through.



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