We made progress last session in moving our state forward. We closed corporate tax loopholes, passed landmark legislation to protect the environment and laid the groundwork to make Massachusetts a world leader in the emerging green economy and extended our lead the life sciences.
This session has seen the passage of landmark reforms in ethics, state pension and transportation.
But overshadowing everything now is the state of the world economy and its impact on our State’s budget. Massachusetts wasn’t alone this year in dealing with a massive budget deficit – forty-eight states faced shortfalls for FY‘10 – most larger than ours (the two states not running deficits have significant income from mineral wealth such as oil and natural gas).
Here in Massachusetts, tax collections have fallen by about $3 billion since last year. When you consider the extra money needed to help families who have lost their jobs or their homes, the deficit we faced this year was closer to $5 billion. The lion's share of that budget gap was closed by making deep cuts to programs and vital government services. We also used about $1.6 billion in federal stimulus money. Less than one-fifth of the shortfall was closed using new revenue sources.
I supported this budget because I believe we took a balanced approach to closing the deficit. We couldn’t do it all with cuts. We needed some additional revenue to adequately fund the essential government services we value and depend on – our schools, our police and fire departments, our roads, and services to protect our children, the disabled, our seniors and others. I don’t take raising taxes lightly, particularly during such difficult times. While we can’t tax our way out of our current problems, there was simply no way to balance the budget without some new revenue.
During a recession as deep as this one there are no good options – we can only choose between bad and worse. Our ability to cut state programs is not unlimited. Critical services like education, transportation, public safety and our judicial system create the framework under which our economy functions. If we had cut too deeply we would have put our economic recovery and future prosperity at risk.
No elected official likes to talk about increasing taxes, but I believe legislators have an obligation to be honest with their constituents about the choices we face. Raising some new tax revenue to reduce the severity of the cuts to critical services was the responsible thing to do.