Dec 16 2011

A 75-cent/week tax cut at the expense of human services?

Posted by: Kevin B. Gilnack, Campaign Manager

Yesterday, Massachusetts Revenue Commissioner Amy Pitter certified a .05% tax reduction because state tax revenues had reached a series of thresholds required to trigger the reduction in the rate.

"The cut, from 5.3 percent to 5.25 percent, will go into effect on Jan. 1. The savings to the average taxpayer would be minimal - most would pocket less than $50 a year under the change - but the impact on the state budget could be significant," according to the Associated Press.

"An average family of four people that owns a home and makes a combined $100,000 would see a reduction of $39 a year. A single parent with two children living in a rented home would get about $9 in relief," the Boston Globe reported.

While this cut has a minimal impact on taxpayers, the Associated Press reports that it will "cost the state about $54 million during the remainder of the current fiscal year, and about $114 million in the fiscal year that starts on July 1, 2012." This reduction in state revenue comes even as Massachusetts Administration & Finance Secretary Jay Gonzalez acknowledges that "the demands in our safety net programs and health care costs generally, the rate of growth in those areas exceeds the growth in resources" (WBUR/State House News).

Michael Weekes, president and CEO of the Providers' Council, was quoted by the Associated Press raising concerns over the decision to cut this significant amount of revenue, which will have such little impact on Massachusetts taxpayers: "We understand state residents need tax relief - many of those who are struggling with low wages are direct care workers in the human services system," Weekes said. "But we must ensure that cutting the states tax rate does not hurt our most vulnerable who receive essential supports from this chronically underfunded sector."

Administration officials and legislators are preparing to craft a FY '13 budget now that will have $114 million less revenue, an increased demands for services, and a dire need to reverse the course of years of stagnant or reduced funding for these important programs. That's why it is so critical that you speak out for fair and adequate funding!

Weekes highlighted what is at stake with this cut in the Boston Globe: "We are concerned that this move could end up hurting the 1 in 10 individuals who receive vital human services from our state. But we must not mislead taxpayers that we have more than enough revenue in a sector where nearly 60 percent of organizations have had cumulative deficits on their state activities since 1993."

Thats why we are speaking out. We need to send a clear message to administration officials to ensure that clients/consumers and human service workers are not left behind as a result of this tax cut.

We face many challenges in the coming months as the state budget moves through the legislature. Funding cuts and belt-tightening in a rough economy can mean the difference between just barely scraping by and having the necessary funds from the state to care for the Commonwealth's most vulnerable residents. 

Will you take a moment to tell legislators what budget adjustments could mean for your agency, workers, and the people you serve?

As a member of The Caring Force, your voice is critical to ensuring that our elected officials provide the support we need for strong services and fair pay for human service workers. Take a moment now to tell Governor Deval Patrick why it is so critical they preserve or increase funding for the programs you care about. Tell him about the impact a modest salary adjustment for direct care workers has on their ability to stay in the sector and provide consistent care to the people they serve.

Human service programs enable the individuals they serve to live and work in their community and enable families to go to work with the peace of mind that their loved ones are safe. The work direct care professionals do is invaluable, and fair pay is critical for enabling them to continue working in the sector, providing the quality, consistent care our neighbors deserve.

These essential increases will allow clients/consumers to continue to receive quality services and  allow providers and their employees to perserve services despite rising health care costs and fill the wage gap that puts many of our providers far behind other sectors.

Thank you for your advocacy! We have a tough fight to protect and improve human service funding in the coming months as the FY '13 budget is created, but together we can give our sector a voice and create positive change.