Saturday, 2:15 PM
Patrick says he'll cut local aid by $128 million
(David L. Ryan/Globe Staff )
Faces were grim today at the Massachusetts Municipal Association Annual Meeting at the Hynes Convention Center.
By Matt Viser, Globe Staff
Governor Deval Patrick announced today that he will cut local aid to cities and towns by $128 million in the current fiscal year and will propose an additional cut of $375 million for the next fiscal year, responding to the economic crisis that is gutting state revenues.
Governor Deval Patrick
The governor also proposed increasing the statewide meals and hotel tax from 5 percent to 6 percent, which he said would raise $150 million that would be distributed to cities and towns to at least partially make up for the loss in other aid.
"We have tough choices among miserable options," Patrick said in a speech before hundreds of city and town officials gathered in Boston for a convention of the Massachusetts Municipal Association. "My job is to make those choices, and I have."
Patrick also said he would penalize local communities and their municipal unions if they don't reduce their health care costs by joining the state's health insurance plan, run by the state Group Insurance Commission, or curb their costs to rates that are comparable to the GIC.
The governor says he would reduce a community's local aid distribution unless it achieves that savings, but he did not say how large the penalty would be.
As expected, Patrick said he would not touch the $3.9 billion that goes to communities for public schools.
The announcement on the cuts was greeted with resignation by local officials, who have been bracing for news for weeks.
"It's a start,'' said Mayor Thomas M. Menino. "I have faith if we work together we'll solve these problems. ... It's not going to be easy.''
"These are dire times, and we want more flexibility,'' Somerville Mayor Joseph A. Curtatone said, referring to the ability to increase taxes on a local level.
Curtatone seemed wary about the healthcare proposal. "It seems to put municipalities at a disadvantage from a management perspective,'' he said.
With cuts on the table, local and state officials are watching progress on a federal stimulus package that would include relief to state governments. Lieutenant Governor Timothy P. Murray has been compiling a list of municipal projects that could begin almost immediately after federal money arrives.
But the list has grown excessively large as local officials contemplate the possibility of new money injected into their communities.
There's no way "we're going to get all that money," Mayor John Barrett III of North Adams said Thursday. "Too many people are going to the trough here. They've really got to streamline them down."
Inevitably, the tough times are pitting major constituencies against one another. The cities and towns, led by Menino, have, in the past, favored legislation that would allow them to impose local meals taxes as a way to ease the burden on property taxes. But restaurants say that they are getting crushed by the recession and that this would be the worst possible time to let cities impose a new tax on the bills that diners pay.
"Why single us out?" Peter G. Christie, president of the Massachusetts Restaurant Association, said Thursday. "Don't single out one industry, particularly an industry that is really reeling right now. I don't think many people in the Patrick administration realize that."
"They can tell you a lot about biotech, why it's important, and why we need to give them $1 billion," he added. "But they want to tax your hamburger."