Officials Unveil Cost-Cutting Proposals to Ease Fiscal Pinch in Massachusetts

October 18, 1989 5 min read

By Michael Newman

Massachusetts officials last week announced a series of spending cuts and other changes aimed at easing the severe fiscal crisis that has gripped the state as the result of its slowing economy.

On Oct. 10, Gov. Michael S. Dukakis unveiled a package of legislative proposals designed to save cities and towns $26 million this year and up to $141 million in fiscal 1991 In July, officials announced a total of $491 million in cuts, including $25 million from education programs.

“There are simply no more shock absorbers left in the system,” said Betsy Houghteling, a spokesman in the state department of revenue. “We’re just cutting into raw bone at this point.”

Before the end of the fiscal year, some experts say, the state may have to slash another $150 million from its $12-billion budget, bringing total cuts for the year to almost $1 billion.

Teacher Layoffs, Program Cuts

The impact of the budget crunch on education has already been “absolutely disastrous,” said Stephen K. Wollmer, a spokesman for the Massachusetts Teachers Association.

Robert B. Schwartz, the Governor’s education adviser, agreed. “We’re desperately trying to hold on to what we’ve got,” he said. “Keep4ing alive the flame of school reform is going to be difficult.”

In almost all of Massachusetts’ 351 municipalities, schools have had to scale back or eliminate programs.

In Arlington, a Boston suburb, students must pay fees of up to $125 each to participate in athletic programs. Students in rural Belchertown have been attending some classes in the cafeteria because the middle school is overcrowded and the town lacks the money to expand it. And medium-size cities like Brockton and Springfield have had to lay off hundreds of teachers.

Statewide, some 3,000 teachers have lost their jobs, with thousands more layoffs likely, according to Mr. Wollmer.

The experience has left many school administrators bitter and frustrated. “The state is kicking the daylights out of public education,” said Robert B. Byard, superintendent of schools in Belchertown.

Nor can school officials look with much confidence for fiscal succor from local taxpayers. Belchertown residents are scheduled to vote this week, for example, on a proposal to override Proposition 2 1/2, the state’s property-tax cap. But voters have already rejected such measures twice this year, Mr. Byard recalled.

“Last time, we got a good turnout and we got whumped,” he noted.

According to the Massachusetts Municipal Association, voters have rejected Proposition 2 1/2 overrides for the current fiscal year about 60 percent of the time.

Lightening the Burden?

The savings plan announced by Mr. Dukakis last week will lighten the burden on cities and towns, according to a spokesman.

But parts of the plan are controversial. One provision would allow municipalites to discontinue health insurance for employees already covered by another plan. The mma estimates that the change would save cities and towns $12 million annually.

The health-insurance proposal “is a real concern for us,” said Mr. Wollmer. “A lot of those benefits were bargained for instead of salary increases.”

Mr. Dukakis’s plan, which must first win approval from the legislature, also contains two provisions concerning special education.

One would require school districts to pay budgeted costs for special-education students who move to another district during the year. The second would encourage greater mainstreaming of handicapped students.

Other elements of the plan allow municipalities to collect property taxes more often, increase cable-television fees, and assess property levies on new construction more quickly.

The savings plan received a tepid reception from some educators and municipal officials. Cities and towns have already lost $225 million in state aid this year, about 40 percent of which would have gone to the schools.

The savings plan is “not going to have a major impact,” said Mayor Peter Torigian of the Boston suburb of Peabody. “But there are some provisions in there that make some sense.”

The plan was “an empty gesture,” Mr. Wollmer contended.

Further Cuts

The proposed $153 million in state spending cuts were part of a $347-million deficit-reduction package presented by L. Edward Lashman, secretary of administration and finance, at a press conference Oct. 11.

The cuts outlined by Mr. Lashman may cost such state education programs as remediation and dropout prevention up to $4 million, Mr. Schwartz estimated.

“There’s not much left to cut, frankly,” he added.

But the budget package may still not create enough savings, Mr. Lashman said. On Oct. 6, the state’s revenue-advisory board revised downward its projection of state tax revenues.

If the board’s estimates are correct, Mr. Lashman said, “it is likely we will have to take further action this fiscal year.”

If that happens, Mr. Schwartz warned, “we are going to have to do some things that are seriously damaging to the future of this commonwealth.” He suggested, however, that the severity of the problem could make the legislature more willing to raise taxes.

But Mr. Wollmer said many educators in the state are already inured to the cutbacks.

“We’re all getting a little tired of watching our public officials stand up before press conferences and tell us how much it pains them to make these cuts,” he said. “The bottom line is, we still don’t have any leadership in this state.”

Meanwhile, several groups have been gathering signatures to placetax-increase plans on the 1990 ballot.

Tax Proposals

A proposal sponsored by the Tax Equity Alliance for Massachusetts would raise about $300 million through an increase in the state’s capital-gains tax and the elimination of some tax exemptions for businesses.

The money would be earmarked for such areas as education, human services, and environmental protection.

Another proposal, sponsored by a newly formed group called Common Sense for Public Schools, would raise the state sales tax by a penny, to 6 percent, and budget the $400 million in additional revenue exclusively for education.

Citizens for Limited Taxation--the group that sponsored Proposition 2 1/2--has proposed a plan to reduce taxes by about $1 billion.

A version of this article appeared in the October 18, 1989 edition of Education Week as Officials Unveil Cost-Cutting Proposals to Ease Fiscal Pinch in Massachusetts