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October 2, 2008

Government Proactive

by at 3:47 pm.

What a difference an administration makes. Immediately (as opposed to what, a year or more delayed reaction in 2002?)…when the budget projections and the actuals stop matching…Governor Patrick is asking his staff, his departments, everyone to tighten their belts to adjust to the declining revenues and credit problems. The Governor sent out a notice to state employees:

Dear Colleague:

As you all know, the national economy — and the financial system on which the economy relies — is under significant stress. As the impact spreads to local businesses and families, it has now spread to the state budget.

By the end of September, state revenues for the first quarter of this fiscal year are $223 million below benchmark, excluding non-recurring receipts; when you count those one-time receipts, we are $143 million off. While these numbers reflect only the first three months of the fiscal year, and are only a fraction of a percent of our budget, they signal worse news ahead. The national economic slowdown, tightening credit and its impact on business activity and consumer spending, market volatility and its effect on capital gains all require us to take further steps now to assure a balanced budget.

These results do not catch us by surprise. Since March, we have implemented spending restrictions, imposed hiring controls, eliminated non-essential spending, and enacted a host of streamlining measures throughout state government. We come to this moment prepared to address the challenges we face.

Today I have directed the Secretary of Administration and Finance to recalculate the revenue estimate for this fiscal year. She will complete that task by October 15th. On the basis of that new estimate, I will cut spending under Section 9C. I fully anticipate that this will affect both programs and our workforce

In addition, he links to more detail on the Governor’s website. The subtitles as listed:

1. Revenue Adjustment and Spending Cuts…
2. Spending Cuts Outside of 9C Authority…
3. Reforms and Restructuring…

  • Dismantling the Turnpike Authority…
  • Consolidating Agencies…

4. Pension Reform…
5. Containing Health Care Costs…

Governor Patrick finishes the letter with:

We will work with you to assure that the outcome is fair, reasonable and responsible for you and our fellow citizens of Massachusetts. And we will do our best to keep you informed of our efforts and decisions as we work through them.

I do not take these steps lightly. I have not and will not lose sight of the value of your service to the Commonwealth and the benefit of your work to your family. I know the road ahead will be rough. But we must keep going. The responsibility we have and the commitment we make is to govern for tomorrow, not just today. Now, more than ever, we will lean on the sense of community and shared responsibility that I have always believed was critical to assuring a better future for us all.

Thank you for your continued dedication to the people of Massachusetts.

Sincerely,

Governor Deval L. Patrick

A proactive tightening now will prevent disaster down the line. And treating the people who work for you with respect and asking them to do their part as patriotic Americans and members of the Commonwealth is the right kind of leadership.

It matters who you elect.

12 Responses to “Government Proactive”

  1. K-R-S Says:

    Lynne, so glad you posted this. I rec’d this email from the Gov’s Office earlier today.
    The fact that they have been planning for this, for many months is great.
    I particularly like cutting the MTA from the troth and streamlining functions with existing resources. Love it! Private business has to do it everyday.

  2. -b Says:

    Sure would be nice if there were some casino revenues to help out. :-)

  3. -b Says:

    Kidding aside, I think the Governor has been doing a good job. It’s nice to see the proactive approach.

    It was also nice to see that he seems to be changing his mind on merging the Turnpike Authority with Mass Highway.

    Maybe Massport and the MBTA can become a target too. They are both bastions of hackdom.

  4. Lynne Says:

    I agree with that, -b, RE the quasi-independent agencies - there are too many redundancies. Hackishness aside (and they ARE known for that too, yes) just reducing the administrative costs of those redundancies will save a tidy little amount.

    Using the argument “we need to cut costs due to the financial crisis” might help him get it done…hopefully. It does, I believe, have to pass through the lege.

    So far as I know, Patrick has always talked about the quasi-independents and merging them - do you have a link to him saying otherwise? This was one of the questions I once asked him in a one-to-one, or something similar, and he was quite keen, while acknowledging the political difficulties of achieving it, to see it done. *shrug*

  5. waittilnextyr Says:

    The agencies not only have administrative redundancies, but they typically provide excessive benefits, so we would be twice blessed by attacking that area for financial reform.

    And within the transportation agencies, there should be a program to eliminate toll booths. They have to be the most inefficient means to obtain revenue. A small increase to the State gasoline tax should be able to replace the revenue at virtually no cost to the State. Given that all roads, bridges, etc. are brought under the umbrella of MA Highway, all users (as measured by gasoline purchased) should pay a share of the cost to maintain them.

  6. -b Says:

    No link, but I know that Patrick did look at merging the Turnpike with Mass Highway shortly after he took office. There was a study done suggesting it would be “too costly” and so he decided against the move.

    Now that the bond rating has sunk, it’s not looking like such a bad idea. The fact that the rating is as low as it is suggests that someone at Turnpike Authority isn’t doing such a good job to begin with.

    The Turnpike Authority has long been a pet peeve of mind. I guess I’ve listened to Christy Mihos too much over the years. I would much prefer the tolls be taken down and replaced with a higher gas tax that would spread the cost of the Big Dig in a more equitable manner. Additionally, we’d do away with much of the toll traffic that takes place - which is a complete waste of gas.

    Ok, I’m done ranting.

  7. waittilnextyr Says:

    Recent headlines imply consolidation and reform will be pursued by Governor Patrick.

    • Patrick has directed Secretary of Transportation Bernard Cohen to prepare legislation to dismantle the Turnpike, merge the remaining transportation agencies and restructure Big Dig debt. He has directed Lt. Gov. Tim Murray to further oversee an administration-wide effort to consolidate departments and agencies

    • Patrick has asked Treasurer Tim Cahill to work with the administration and Pension Reform Commission to craft a legislative plan to reform state and MBTA pension systems.

  8. Lynne Says:

    I’d be OK with replacing tolls with a small gas tax increase. The more gas costs, the more incentive to stop driving to everywhere, the more public transit looks yummy.

    And despite the fact that I think toll workers should be paid decent (it’s gotta be the crummiest job, sorry, all those fumes in your face all day? no thanks) they are fairly HIGHly paid (probably a little too high) and eliminating the need for that would be a cost saver. Not much of one, considering the numbers (I mean really, how many workers are there, compared to say, the rest of the state’s departments?), it will still be a bit. Gas taxes are much easier to administrate (in fact, since we have a gas tax already, it should add zero to the administrative costs).

  9. kpem Says:

    “I’d be OK with replacing tolls with a small gas tax increase. The more gas costs, the more incentive to stop driving to everywhere, the more public transit looks yummy.”

    No thank you! Gas is high enough and for some of us with jobs in the Worcester area there is no public transit. They already have the sign when you enter NH on the liquor stores that thanks Duval for his tax increases on ciggeretes, now we will have those thankyou’s on the gas station too. Our tolls are not at all high compared to other states. Very easy for someone with options on their commute to make a blanket statement for everyone

  10. waittilnextyr Says:

    The MA Turnpike (east and west) took in about $265M in toll revenue in 2007, which was about 85% of its total revenue. However, their expenses, including depreciation, were about $78M higher than the income.

    Included in their expenses were $141M for operations and public protection, $22M for General and Administrative expenses, $17M for fringe benefits and $12M for retirement benefits. Of the $141M for operations, approximately $31M was for toll taker salaries.

    If there were no toll, the State (assuming no agency) would lose $265M in revenue, but eliminate at least $31M in costs, and probably more as the fringe, retirement and some other operational/maintenance costs would be eliminated.

    So, with no tolls the State may have to make up about $225M to keep the Turnpike running. How much the 23.5 cent/gallon gasoline tax would have to increase to make this up is unknown, but it certainly could be done with no increase in administrative costs and a lot less traffic tie-ups along the route.

  11. joe from Lowell Says:

    It’s not like Patrick had an affirmative agenda anyway. So he’s going to be a caretaker with limited capacity for pushing the ball down the field; well, that’s what he was going to be anyway.

    Heck, that’s what President Clinton was, and that didn’t turn out so badly. Except this guy’s a progressive.

  12. Lynne Says:

    No agenda? Are you living under a rock? Seriously.

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