Beacon Hill Roll Call: Constitutional convention approves millionaire income tax

THE HOUSE AND SENATE - Beacon Hill Roll Call records local representatives’ and senators' votes on roll calls from the week of June 10-14.

CON CON VOTES TO TAX MILLIONAIRES ANOTHER 4 PERCENT (H 86)

House and Senate held a Constitutional convention and approved 145-48, (House approved 112-43, Senate approved 33-5), a proposed constitutional amendment that would allow a graduated income tax in Massachusetts and impose an additional 4 percent income tax, in addition to the current flat 5.1 percent one, on taxpayers’ earnings of more than $1 million.

Language in the amendment requires that “subject to appropriation” the revenue will go to fund quality public education, affordable public colleges and universities, and for the repair and maintenance of roads, bridges and public transportation.

The proposal is sponsored by Sen. Jason Lewis (D-Winchester) and Rep. James O’Day (D-West Boylston). In order to go on the ballot for voters to decide, it needs to twice have the votes of 101 of the 200 members of the House and Senate in the current 2019-2020 session and again in the 2021-2022 session. This vote is the second time for the 2019-2020 session. The earliest it could be on the ballot is in November 2022.

A similar effort by a group called the “Raise Up Coalition” to get the question on the 2018 ballot was derailed when it was ruled unconstitutional by the Supreme Judicial Court which said the constitution prohibits placing more than one objective in a single proposed constitutional amendment that is sought by a citizens’ group.

The court’s decision noted that the proposal imposed the tax and then stipulates how the money could be spent.

The current amendment is proposed by legislators rather than citizens and according to proponents, amendments proposed by legislators can have more than one objective and would not be ruled unconstitutional by the court.

Supporters said the amendment will affect only 20,000 extremely wealthy individuals and will generate up to $2 billion annually in additional tax revenue. They argued that using the funds for education and for the repair and maintenance of roads, bridges and public transportation will benefit millions of Bay State taxpayers. They noted the hike would help lower income families which are now paying a higher share of their income in taxes.

Opponents argued the new tax will result in the loss of 9,500 private sector jobs, $405 million annually in personal disposable income and some millionaires moving out of state. They said that the earmarking of the funds for specific projects is illegal and said all the funds will go into the General Fund and be up for grabs for anything.

“Today marks the start of improved social and economic outcomes for communities across the commonwealth,” said Rep. O’Day. “Moving forward, the Fair Share Amendment will allow our education systems and transportation infrastructure to be strengthened. By reducing the burden placed on low and middle-income families, the Fair Share Amendment will benefit students, workers, and businesses -- ensuring that the Massachusetts economy continues to grow and thrive.”

“Another election must intervene before the second and final vote occurs, in the 2021-22 legislative session, before this constitutional amendment can appear on the 2022 statewide ballot for voters to ultimately decide,” said Chip Ford, executive director of Citizens for Limited Taxation. “Though in Massachusetts it's highly unlikely, there remains a distant possibility that a turnover in the Legislature in the 2020 election can derail this abomination. Unfortunately, Massachusetts being "The Bluest State," pigs will likely need to fly first and Hell freeze over."

“The revenues from the Fair Share Amendment will go a long way to increase funding for public schools, make higher education more affordable for students and families, and fix our state’s crumbling roads, bridges and public transportation,” said Sen Lewis. Today, more than three quarters of legislators voted to advance the Fair Share Amendment, reflecting the overwhelming public support for this measure. The Fair Share Amendment is the best way to make the investments in our Commonwealth that we desperately need in the fairest way possible.”

“The people that will be hurt most by this are the thousands of small businesses across our state that will be slammed by this 80 percent hike,” said Paul Craney, executive director of the Massachusetts Fiscal Alliance “ It’s your local, independent real estate agent, or the little café on Main Street that will be shouldering the burden of this tax increase, not corporate CEOs.”

(A "Yes" vote is for the additional 4 percent tax. A "No" vote is against it.)

Rep. Carole Fiola Yes

Rep. Patricia Haddad Yes

Rep. Steven Howitt No

Rep. Christopher Markey No

Rep. Paul Schmid Yes

Rep. Alan Silvia Yes

Sen. Mark Montigny Yes

Sen. Marc Pacheco Yes

Sen. Michael Rodrigues Yes

REVENUE FROM TAX MUST BE IN ADDITION TO CURRENT FUNDING (H 86)

The Constitutional Convention rejected 40-156, (House rejected 34-123. Senate rejected 6-33) an amendment that would require that the revenue generated by the 4 percent tax be in addition to the amount of funding for education and transportation that the Legislature already spends on those two areas.

Amendment supporters said this will prevent a “bait and switch” scenario in which $2 billion in new revenue from the 4 percent tax is dedicated to transportation and education but then the Legislature takes money out of the money currently spent in those areas and spends it elsewhere. The net result would be that the $2 billion is essentially spent in other areas rather than the two promised ones.

Amendment opponents said that the voters have already been educated on this exact amendment the House is considering. They argued that to make changes at this stage is against the democratic imperative of making sure the voters are educated on this and would raise we raise legal issues.

“The language in the underlying amendment is what has been vetted and researched over the past several years,” said Rep. O’Day, who opposed the amendment. “It has a very narrow scope. Any additions would change what the will of the people demanded with the underlying amendment.”

“The claim that my amendment would somehow confuse voters and would raise legal issues is ludicrous,” said House amendment sponsor GOP Minority Leader Brad Jones (R-North Reading.) “All the amendment says is that the revenues raised through the new surtax must be used to supplement state spending on education and transportation, not supplant it. The voters of the commonwealth are being sold a false bill of goods because without this clarifying language, there are no guarantees the Legislature will actually increase spending on our schools and transportation infrastructure. The Legislature doesn’t have a great track record for respecting the will of the voters on tax issues, and my fear is that voters are being set up for a bait-and-switch.”

(A “Yes” vote is for the amendment. A “No” vote is against it.)

Rep. Carole Fiola No

Rep. Patricia Haddad No

Rep. Steven Howitt Yes

Rep. Christopher Markey No

Rep. Paul Schmid No

Rep. Alan Silvia No

Sen. Mark Montigny No

Sen. Marc Pacheco No

Sen. Michael Rodrigues No

ALLOW LEGISLATURE TO LOWER THE 4 PERCENT TAX (H 86)

The Constitutional Convention rejected 41-155, (House rejected 35-122. Senate rejected 6-33) an amendment that would eliminate the permanent 4 percent surtax and instead designate that the Legislature can set the tax which can be up to 4 percent but can be lower and even as low as zero percent.

Amendment supporters said putting the permanent 4 percent tax in the constitution is a bad policy because it would take four years to repeal the tax if the Legislature and/or voters feel that it was a mistake to raise it. They said the amendment would put the power in the hands of the Legislature which could repeal it quickly.

“If circumstances change or we see that there is significant out-migration among the 20,000 or so who would be subject to the millionaire’s tax, [this amendment] would allow the Legislature to take mitigating actions,” said Rep. Randy Hunt (R-Sandwich), the sponsor of the amendment. “Without [it], it’s a four-year process to “re-amend” the constitution.”

Amendment opponents said that the voters have already become familiar with the exact amendment the House is considering. They argued that to make changes wouldn’t make sense and is unfair to the voters.

(A “Yes” vote is for the amendment. A “No” vote is against it.)

Rep. Carole Fiola No

Rep. Patricia Haddad No

Rep. Steven Howitt Yes

Rep. Christopher Markey No

Rep. Paul Schmid No

Rep. Alan Silvia No

Sen. Mark Montigny No

Sen. Marc Pacheco No

Sen. Michael Rodrigues No

LOWER THE TAX RATE FOR TAXPAYERS EARNING UNDER $100,000 (H 86)

The Constitutional Convention rejected 41-155 (House rejected 35-122, Senate rejected 6-33), an amendment that would eliminate the permanent 4 percent surtax and instead designate that the Legislature can set the tax which can be up to 4 percent but can be lower, and even as low as zero percent. The amendment also provides for some tax relief by lowering the rate for taxpayers who earn less than $100,000.

The rate would be reduced by 50 percent of the rate of the millionaire’s tax for that year.

Amendment supporters said the state’s tax system is regressive and that this amendment will reduce taxes for low-income and lower-middle-class taxpayers. They gave an example of how it would work. If the Legislature imposes the highest 4 percent surtax, the current 5 percent income tax rate for people who earn less than $100,000 would fall to 3 percent.

Amendment opponents said that the House should stay with the language of the amendment as written because voters have been well informed on it and changing the amendment would be unfair.

(A “Yes” vote is for the amendment. A “No” vote is against it.)

Rep. Carole Fiola No

Rep. Patricia Haddad No

Rep. Steven Howitt Yes

Rep. Christopher Markey No

Rep. Paul Schmid No

Rep. Alan Silvia No

Sen. Mark Montigny No

Sen. Marc Pacheco No

Sen. Michael Rodrigues No

ALSO UP ON BEACON HILL

2019 SALES TAX HOLIDAY (H 3899) - The House and Senate approved, on a voice vote without debate and without a roll call vote, a measure designating Saturday, August 17 and Sunday, August 18 as this year’s sales tax holiday which allows consumers to buy most products that cost under $2,500 on those two days without paying the state's 6.25 percent sales tax. The vote was only on choosing the dates, not on establishing the holiday itself. Last year the Legislature instituted a permanent annual sales tax holiday and gave the Legislature the power to choose the date each year.

Supporters of the measure say the holiday, which has been in effect for many years, would boost retail sales and noted that consumers would save millions of dollars. They argue that the state's sales tax revenue loss would be offset by increased revenue from the meals and gas tax revenue generated by shoppers on those two days.

Some opponents of the holiday say the state cannot afford the up to $30 million estimated revenue loss and argue the holiday actually generates little additional revenue for stores because consumers typically buy the products even without the tax-free days. They say that the Legislature should be looking at broader, deeper tax relief for individuals and businesses and not a tiny tax-free holiday. Others say that legislators should not vote for this tax holiday when they have not yet restored all of the important program cuts made over the past few years.

DELAY PAID LEAVE PAYROLL TAX FOR THREE MONTHS (S 2255) – The House and Senate approved and Gov. Charlie Baker signed into law a bill that delays until October 1 the start of a payroll tax, that will be paid by workers, employers and the self-employed to fund paid family and medical leave benefits for Massachusetts workers. The 0.63 percent payroll tax was supposed to be effective July 1 to fund the estimated $1 billion paid family and medical leave program that was signed into law last year. Business and advocacy groups have raised concerns about their ability to prepare for the for the new tax by July 1.

A joint statement issued by Gov. Baker, House Speaker Bob DeLeo and Senate President Karen Spilka expressed their support for the delay.

“To ensure businesses have adequate time to implement the state’s Paid Family and Medical Leave program, the House, Senate, and administration have agreed to adopt a three -month delay to the start of required contributions to the program,” read the statement. “We will also adopt technical changes to clarify program design. We look forward to the successful implementation of this program this fall.”

The Paid Family and Medical Leave Program is overseen by the Department of Family and Medical Leave. According to the department’s website, the program “provides temporary income replacement to eligible workers who are welcoming a new child into their family, are struck by a serious illness or injury, need to take care of an ill or ailing relative and for certain military considerations.”

The website notes that beginning in January of 2021 most workers in Massachusetts will be eligible to get up to 12 weeks of paid family leave and up to 20 weeks of paid medical leave.

ICE CREAM TRUCKS (H 3727) – The House gave initial approval to legislation that would amend a current law that requires an amber dome light and the flashing orange lights on the back of ice cream trucks when the truck is parked and serving ice cream. The bill would provide that the law be enforced and would impose a $50 fine for failure to have the lights. It would also require that the operation of the lights be included as part of the truck’s annual inspection.

"Although trucks that serve frozen desserts are required to use these lights ... the requirement as written includes no enforcement mechanism,” said Rep. Tommy Vitolo (D-Brookline), the sponsor of the bill. “This may have been adequate when Hood was the sole ice cream provider. I believe that it is inadequate today.”

Vitolo said that the bill would increase child safety by serving as a warning to people in their cars that children are present, and that additional caution is warranted. “Clearly articulating the enforcement and penalties for failing to utilize this safety feature will enhance child safety in Massachusetts,” he concluded.

INTELLECTUAL DISABLED IN COLLEGE (H 1219) – The Higher Education Committee held a hearing on legislation that would allow students with intellectual disabilities or autism to attend all 29 state universities in order to gain skills necessary to work and live independently in the community. Eligible high students would have to be 18 to 22 years old, have not passed MCAS, and be eligible for special education services; or high schoolers aged 20 to 21 who have passed MCAS but are still eligible for special education.

The Massachusetts Inclusive Concurrent Enrollment Initiative administers this program. Its website says, “Evidence shows that students benefit academically and transition to young adulthood more readily when they have the opportunity to engage in all college-related activities (e.g., establishing new social networks, participating in campus-wide events, learning to use public transportation to and from campus, completing course assignments, obtaining employment) rather than staying at high school. Student participation in this grant program may be incorporated into a student’s transition program, as determined through the school district’s special education process.”

“Students with intellectual disabilities throughout Massachusetts and the rest of the country have demonstrated the tremendous value of participating in college,” said Rep. Sean Garballey (D-Arlington), the sponsor of the bill. “When barriers are removed allowing students to audit classes and participate in campus activities, students thrive, exceeding our expectations. National research data indicates that over 65 percent of adults with intellectual disabilities who attended college were able to find paid employment, compared to an employment rate of 17 percent for those who did not.”

HOW LONG WAS LAST WEEK'S SESSION? Beacon Hill Roll Call tracks the length of time that the House and Senate were in session each week.

Many legislators say that legislative sessions are only one aspect of the Legislature's job and that a lot of important work is done outside of the House and Senate chambers. They note that their jobs also involve committee work, research, constituent work and other matters that are important to their districts. Critics say that the Legislature does not meet regularly or long enough to debate and vote in public view on the thousands of pieces of legislation that have been filed. They note that the infrequency and brief length of sessions are misguided and lead to irresponsible late-night sessions and a mad rush to act on dozens of bills in the days immediately preceding the end of an annual session.

During the week of June 10-14, the House met for a total of eight hours and 31 minutes while the Senate met for a total of ten hours and 19 minutes.

Mon. June 10

House 11:03 a.m. to 1:05 p.m.

Senate 11:09 a.m. to 1:45 p.m.

Tues. June 11

No House session

No Senate session

Wed. June 12

House 1:08 p.m. to 3:50 p.m.

Senate 1:08 p.m. to 3:50 p.m.

Thurs. June 13

House 11:06 a.m. to 3:53 p.m.

Senate 11:02 a.m. to 4:03 p.m.

Fri. June 14

No House session

No Senate session

Bob Katzen welcomes feedback at bob@beaconhillrollcall.com