Home 
Local Aid and Finance Ballot questions could affect FY11 local aid
Two of the three binding questions headed to the Nov. 2 state election ballot would significantly reduce state tax revenues, beginning this year, making another round of deep cuts in municipal and school aid programs likely.
Question 3 would reduce the state’s sales tax rate from 6.25 percent to 3 percent effective on Jan. 1, 2011.
The sales tax is forecast to bring in about $4.8 billion this year under the current rate, accounting for about a quarter of all state tax collections. Question 3 would reduce collections by about $1 billion below the amount used to balance the state’s fiscal 2011 budget. Over a full year, Question 3 would reduce sales tax collections by more than $2.5 billion.
Question 1, meanwhile, would eliminate the sales tax on beer, wine and other alcoholic beverages, a change that would reduce tax collections by about $110 million over a full year. The change would also take effect on Jan. 1, 2011.
Questions 1 and 3 come at a challenging time for state and local finances in Massachusetts. State tax collections for fiscal 2011, under the current forecast, are still lower than any year since fiscal 2007. The state budget, including deep municipal aid cuts, is balanced using one-time and temporary revenues that, for the most part, will not be available for fiscal 2012.
While the governor and legislative leaders have not announced plans for a response to possible voter approval of one or both of these questions, the MMA is developing planning scenarios to help cities and towns figure out what the impact of mid-year aid cuts could be on municipal and school budgets later this year and in fiscal 2012.
In 2008, voters by a wide margin rejected a ballot question that would have abolished the state’s personal income tax.
The other 2010 ballot question, Question 2, would repeal Chapter 40B, the state law that allows property developers and builders to skirt certain local zoning and land use regulations if a portion of the housing units are subsidized and restricted to ensure reduced sales and resale prices.
All three questions originated as initiative petitions in 2009. Supporters gathered the necessary signatures (at least 66,593) in the fall of 2009, and an additional 11,099 signatures last summer to reach the ballot this November.
For more information about the ballot questions, visit the secretary of state’s website (www.sec.state.ma.us/ele/elepip10/pip10idx.htm).
Local Aid and Finance Ballot questions could affect FY11 local aid
Ballot questions could affect FY11 local aid
Two of the three binding questions headed to the Nov. 2 state election ballot would significantly reduce state tax revenues, beginning this year, making another round of deep cuts in municipal and school aid programs likely.
Question 3 would reduce the state’s sales tax rate from 6.25 percent to 3 percent effective on Jan. 1, 2011.
The sales tax is forecast to bring in about $4.8 billion this year under the current rate, accounting for about a quarter of all state tax collections. Question 3 would reduce collections by about $1 billion below the amount used to balance the state’s fiscal 2011 budget. Over a full year, Question 3 would reduce sales tax collections by more than $2.5 billion.
Question 1, meanwhile, would eliminate the sales tax on beer, wine and other alcoholic beverages, a change that would reduce tax collections by about $110 million over a full year. The change would also take effect on Jan. 1, 2011.
Questions 1 and 3 come at a challenging time for state and local finances in Massachusetts. State tax collections for fiscal 2011, under the current forecast, are still lower than any year since fiscal 2007. The state budget, including deep municipal aid cuts, is balanced using one-time and temporary revenues that, for the most part, will not be available for fiscal 2012.
While the governor and legislative leaders have not announced plans for a response to possible voter approval of one or both of these questions, the MMA is developing planning scenarios to help cities and towns figure out what the impact of mid-year aid cuts could be on municipal and school budgets later this year and in fiscal 2012.
In 2008, voters by a wide margin rejected a ballot question that would have abolished the state’s personal income tax.
The other 2010 ballot question, Question 2, would repeal Chapter 40B, the state law that allows property developers and builders to skirt certain local zoning and land use regulations if a portion of the housing units are subsidized and restricted to ensure reduced sales and resale prices.
All three questions originated as initiative petitions in 2009. Supporters gathered the necessary signatures (at least 66,593) in the fall of 2009, and an additional 11,099 signatures last summer to reach the ballot this November.
For more information about the ballot questions, visit the secretary of state’s website (www.sec.state.ma.us/ele/elepip10/pip10idx.htm).
Written by MMA Legislative Director John Robertson
