Senator Warns of ‘Enormous Risk’
of Question 1

Ballot Question 1, eliminating the state income tax, would have “potentially dramatic” effects on nonprofit schools and colleges if approved by voters on Nov. 4, according to State Sen. Stanley C. Rosenberg.

“It poses enormous risk, and there is a risk it will pass,” Rosenberg told MANS&C members at a meeting at the Deerfield Inn on Oct. 21.  “The implications for you are pretty significant.”

Rosenberg, a member of the Higher Education Committee, pointed out that $12.7 million will be eliminated from the state budget if the measure is approved.  The major impact of the lost tax revenue would be on state aid to local communities.

“It will create pressure on all institutions and there will be a demand that the property tax burden be spread more equitably,” Rosenberg said.  “If it passes, we will see dynamic and dramatic questions on the tax-exempt status of all nonprofit institutions, including educational institutions.”

Rosenberg, who also serves as Senate President Pro Tem, could not predict what the legislature would do if the measure passes, which he called an “unprecedented situation.”  In the past, lawmakers have ignored or amended ballot items, but they weren’t as dramatic as the income tax measure, he noted.

Turning to the state’s current budget crisis, the Democrat from Amherst said he expects a second round of budget cuts in the next few weeks.  Gov. Patrick recently announced $1.1 billion in cuts and staff layoffs as a result of the economic downturn.

 

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Nonprofit schools and colleges are increasingly being seen as revenue sources by local communities facing tight budgets.

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