Agenda for Leadership 2026 Press Kit

Media Contact:

Amie O’Hearn

aohearn@pioneerinstitute.org

Report outlines practical steps to expand labor force participation, integrate legal immigrants, reduce red tape, and restore Massachusetts’ competitive edge

BOSTON, MA (February 25, 2026) – With residents leaving and business formation declining, Massachusetts cannot afford regulatory systems that block workers and entrepreneurs. A new Pioneer Institute report argues that outdated rules are constraining growth and outlines practical reforms to expand workforce participation, better integrate legal immigrants and new market entrants, support small business formation, and restore competitiveness.

“Massachusetts has extraordinary talent and entrepreneurial energy, but too many willing workers and aspiring business owners are stuck navigating unnecessary red tape,” said Jim Stergios, executive director of Pioneer Institute. “If we want to compete for jobs and investment, we need to modernize our systems so they work for entrepreneurs, immigrants, and small employers—not against them.”

The report is the final part of Pioneer’s Agenda for Leadership series that examines how Massachusetts can restore economic dynamism and offers policy solutions for the next administration on how to make the state a competitive giant once again. It follows previous analysis on housing production, healthcare, education and business competitiveness.

Among the report’s central findings: Massachusetts maintains one of the most complex and burdensome regulatory environments in the country. In Boston, for example, starting a restaurant requires navigating 92 steps across multiple agencies, completing numerous in-person tasks, and paying a dozen separate fees—far more than in many peer cities.

These barriers reflect deeper regulatory fragmentation. The report outlines practical reforms to streamline processes and expand access to work and entrepreneurship.

Create a statewide “One-Stop Business Portal.” The report calls for the creation of a statewide portal that integrates registration, licensing, and permitting processes across state and municipal government. The portal would include multilingual access and connect users to legal, financial, and workforce support resources.

Adopt universal recognition of out-of-state occupational licenses. Nearly one-third of U.S. workers now require a government license, and in Massachusetts the average license takes 511 days to obtain. The Commonwealth is one of the few states that does not recognize out-of-state licenses, forcing relocating professionals—including physicians—to repeat costly and time-consuming approval processes.

“Universal recognition of out-of-state licenses is a simple, bipartisan reform that increases labor mobility and helps fill workforce shortages more quickly,” said Aidan Enright, Pioneer’s Economic Research Associate, & Fellow on Immigrant Entrepreneurship. “When qualified professionals move here, they should be able to get to work.”

Twenty states, including Vermont and New Hampshire, have adopted universal license policies. The Institute urges Massachusetts to join them, particularly to address shortages in healthcare, trades, and personal services.

Replace low-risk occupational licenses with voluntary certification. This reform would allow workers to practice while giving consumers the option to choose credentialed providers. Pioneer also calls for ending license suspensions related to student loan default and removing immigration-status barriers that prevent qualified individuals from working.

Expand pathways for internationally trained professionals and immigrant entrepreneurs. Addressing crisis-level workforce shortages in healthcare, the report recommends building on the state’s physician apprenticeship pilot by creating structured supervised-practice models in nursing, behavioral health, dental hygiene, and elder care. It also calls for expanding the Global Entrepreneur in Residence program, which enables public universities to sponsor cap-exempt H-1B visas for immigrant founders launching companies in Massachusetts.

Reform the unemployment insurance system. The report recommends using a portion of the state’s Rainy Day Fund to address outstanding UI liabilities and indexing benefit duration to economic conditions, similar to reforms adopted in Florida. Additional recommendations include strengthening fraud prevention and reforming experience rating to improve predictability for employers.

Align English language instruction with workforce development. Immigrants make up roughly 20 percent of the Massachusetts workforce, yet many face underemployment due to limited English proficiency. The report recommends integrating English language instruction into job training and entrepreneurship programs and creating a centralized statewide waitlist system to match students with available seats more efficiently.

“Economic freedom means ensuring that every qualified worker can contribute and every entrepreneur can compete,” Stergios said. “By removing unnecessary barriers to work and modernizing outdated systems, Massachusetts can expand opportunity, grow its tax base, and remain a national leader in innovation.”

The report is part of Pioneer Institute’s new book Agenda for Leadership: Choosing to Compete, edited by Jim Stergios. The book is available on Amazon today. Additional information is available at:https://pioneerinstitute.org/agenda-for-leadership-2026/

Proposed reforms cover zoning, the local approval process, and how the state classifies subsidized units 

BOSTON, MA (February 18, 2026) – Emphasizing the role housing underproduction plays in the state’s exorbitant cost of living, a new Pioneer Institute report offers practical policy solutions to help rein in home prices and better accommodate the housing needs of Massachusetts families. 

“Massachusetts isn’t building the homes it needs because we’ve tied the process up in knots of red tape,” said Jim Stergios, Pioneer Institute’s executive director. “Only the largest and best-connected developers can get projects approved. We need an all-hands-on-deck approach, including builders of every size, to keep young families here – buying homes, building wealth, and putting down roots.” 

The report on housing production and affordability is part of a three-part Agenda for Leadership series examining how Massachusetts can restore economic dynamism. An upcoming companion report focuses on workforce development, and an analysis on business competitiveness has already been published.  

In 2024, Massachusetts ranked 45th in the country in new homes permitted per capita. States at the top of the list – like North Carolina, Texas, Florida, and Tennessee – consistently give home buyers and renters more options, and some have seen home prices stabilize or even fall in recent years. 

“The high cost of housing is a fundamental barrier to entry into our economy and diminishes our quality of life in Massachusetts,” said Andrew Mikula, senior housing fellow at Pioneer. “It’s also a solvable problem. We need enough new homes coming online to absorb new demand and keep upward price pressure off the existing stock.” 

The report identifies several policy changes to facilitate a faster and more predictable permitting process for new homes. 

First, clear evaluation criteria for site plan reviews should be codified in state law, minimizing the odds that matters of technical expertise become discretionary and redundant when presented to citizen boards. Permits and zoning changes before those boards and local legislative bodies that facilitate new housing production should only require a simple majority vote for approval, not the supermajority vote threshold often required by statute. Lastly, the state should take steps to steer lawsuits challenging the outcome of local permitting decisions to specialty venues that can process them faster, as well as enact criteria for plaintiffs that minimize the odds of nuisance lawsuits.  

The report also promotes several broad categories of zoning changes. One recommendation is to expand homeowners’ rights to build accessory dwelling units on their properties, which often take the form of backyard cottages or attic or basement apartments. The report also recommends allowing multifamily housing in commercial and industrial areas without the need for discretionary permits. More incremental development should also be allowed in existing residential areas that are well-served by centralized utilities. Finally, off-street parking requirements for new housing should be reduced or eliminated, especially near transit. 

A final recommendation suggests that the state phase out the inclusion of some market-rate units in its Subsidized Housing Inventory. This reform would increase the capacity – and political will – for additional production under state mixed-income housing programs like Chapter 40B and Chapter 40R.  

Collectively, these proposals aim to facilitate the development of more homes and, particularly, typologies of homes that tend to have lower prices than those that are both legal and financially viable to build today.  

“When it’s too difficult for young professionals and their families to afford a home here, many of them end up leaving,” Stergios said. “Breaking down some of these barriers to building new housing is the least we can do to put the American Dream within reach for more Massachusetts families.”  The report is part of Pioneer Institute’s forthcoming volume, Agenda for Leadership: Choosing to Compete, edited by Pioneer Executive Director Jim Stergios. Additional chapters will be released in the coming weeks. More information is available at:  https://pioneerinstitute.org/agenda-for-leadership-2026/

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Study outlines practical reforms to restore competitiveness, starting with tax relief for small and mid-sized businesses

BOSTON, MA (February 11, 2026) – Underscoring the state’s unsustainable outmigration of talent and capital, a new Pioneer Institute report offers practical policy solutions to make Massachusetts more attractive to residents, companies, and investors.

“Outmigration from Massachusetts is not a mystery and it is not inevitable,” said Jim Stergios, Pioneer Institute’s executive director. “It is the result of choices in our state laws, regulations, and budgets that have made the Commonwealth hard to afford—whether you are a family or a business. When a company like Cape Cod Potato Chips packs up and leaves Massachusetts, you know something is terribly awry.”

The report is part of a three-part Agenda for Leadership series examining how Massachusetts can restore economic competitiveness. Upcoming companion reports will address housing affordability and workforce development, while this analysis focuses on business competitiveness and outmigration.

Recent Census data show Massachusetts lost 33,000 residents on a net basis in the most recent year, confirming trends Pioneer warned about during the debate over the 2022 surtax. The report underscores that these population losses are now showing up in anemic job growth, declining business formation rates, and a more fragile tax base.

Other states have made different choices—lowering marginal rates, simplifying business taxes, and aligning policy with growth. The result is predictable.

“When people and businesses leave,” said Andrew Mikula, senior housing fellow at Pioneer, “it is not an abstract demographic trend, but rather a response to incentives. The Commonwealth can either continue down this path or adopt reforms that restore growth, opportunity, and long-term fiscal stability.”

A poll of more than 500 former Massachusetts residents found that over 70 percent cited tax policy as a major reason for leaving, with housing and healthcare costs close behind. Nearly 70 percent were employed full-time or self-employed before relocating, indicating a loss of active members of the workforce rather than retirees. Although only 1 percent of Massachusetts taxpayers earn more than $1 million annually, they accounted for 3 percent of those moving to Florida and New Hampshire.

Surveys of Massachusetts-based accountants reinforce the trend. Nearly 70 percent of CPAs surveyed reported that at least one high-income client changed their primary residence in 2024, with tax policy, cost of living, and the business climate cited most frequently as motivations for the moves.

Punitive Treatment of Pass-Through Businesses

A central focus of the report is Massachusetts’ tax treatment of S corporations and partnerships, which form the backbone of the state’s small and mid-sized business economy. Massachusetts is far out of line with competitor states in applying multiple layers of taxation to the same income, sharp marginal rate spikes triggered by the 2022 surtax, and pass-through tax rules that penalize growth and mobility.

The report promotes policies that encourage investment, hiring, and expansion—and aim to stem the tide of Massachusetts employers relocating themselves and their businesses elsewhere.

“The outmigration crisis is a rational response to a tax code that penalizes success and mobility,” said Aidan Enright, economic research associate at Pioneer. “The Legislature and the Governor need to act to give businesses and their owners more reasons to stay here.”

Solutions That Can Be Implemented Now

In addition to reforms affecting S corporations and partnerships, the report identifies several policy changes that could help retain business owners, investors, and employers in Massachusetts.

The report calls for repealing asset-based corporate taxes that apply regardless of profitability and discourage investment. These include the minimum corporate excise tax, which imposes liability even in loss years, and the rolling stock tax, which uniquely penalizes firms for investing in equipment and mobile capital. Currently, these taxes accelerate capital flight and disadvantage Massachusetts relative to competitor states.

The report also recommends repealing the estate tax, identifying it as a powerful driver of outmigration among business owners and retirees. Because residency is a choice, the estate tax encourages individuals with portable income or ownership stakes to relocate well before retirement or succession planning begins—often taking businesses, jobs, and investment with them.

More broadly, the report urges Massachusetts to align its overall business tax structure with typical structures elsewhere. States competing successfully for residents and employers have simplified tax codes, eschewed marginal rate spikes, and made significant efforts to attract investment. Massachusetts has moved in the opposite direction.

“These recommendations are about having Massachusetts go back to moderation,” Stergios said. “If we are moderate, the state has so much going for it, and we win the race for prosperity. But fair warning: once people and businesses leave, they rarely return.”

The report is part of Pioneer Institute’s forthcoming volume, Agenda for Leadership: Choosing to Compete, edited by Pioneer Executive Director Jim Stergios. Additional chapters will be released in the coming weeks. More information is available at:  https://pioneerinstitute.org/agenda-for-leadership-2026/

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Analysis urges action on civic education, government transparency and voter-approved oversight reforms 

BOSTON, MA (February 4, 2026) – As Massachusetts students continue to show alarming gaps in U.S. history and civics knowledge and state government resists basic transparency measures, a new Pioneer Institute report warns that the Commonwealth risks eroding informed citizenship and public trust. The report calls on state leaders to administer the long-mandated U.S. history and civics MCAS exam and comply with the voter-approved audit ballot initiative—steps the authors say are critical to restoring civic literacy, accountability, and confidence in government. 

“A functioning democracy depends on citizens who know U.S. history, understand the Constitution and appreciate the responsibilities that accompany self-government,” said Jamie Gass, Pioneer Institute’s director of education. 

The report, “American Citizenship: A Vision for Transparency & State Policy Innovation,” calls on the Commonwealth to finally implement the U.S. History and Civics MCAS exam required under the 1993 Education Reform Act.  It also recommends requiring passage of the U.S. Citizenship Test for high school graduation beginning with the class of 2028, mandating content-rich professional development for U.S. history and civics teachers, and aligning state standards and local assessments to emphasize factual knowledge of the Founding documents, state and U.S history, and core civic processes. 

Strengthening Government Transparency 

The report also outlines a series of reforms aimed at improving transparency and accountability in state government.  

With 71 percent of voters having approved a ballot initiative allowing the state auditor to audit the Legislature, the report urges lawmakers to drop their legal objections and comply with the measure. 

“The Legislature works for the public, and the public deserves full visibility into how it operates and spends taxpayer dollars,” said Mary Connaughton, Pioneer’s director of government transparency. 

The report calls for extending open meeting and public records laws to the General Court, ending the Legislature’s exemption from basic transparency standards that apply to other public bodies.  

Similarly, it urges reform of the state’s interpretation of the 1997 Massachusetts Supreme Judicial Court case Lambert v. Executive of the Judicial Nominating Council, which has been used to allow the Governor’s Office and the Judiciary to fulfill public records requests “at the office’s discretion.” 

Among 49 states that require elected officials to file statements of financial interest, Massachusetts is the least transparent.  The Commonwealth currently requires individuals requesting access to these records to present a photo ID and discloses the requester’s identity to the official whose information is being sought.  The report recommends making these disclosures available anonymously and online in searchable, downloadable formats, consistent with practices in most other states. 

Additional recommendations include establishing an independent office under the Inspector General to assess the revenue or cost impacts of legislation expected to have a fiscal impact exceeding $5 million, ending the use of government systems to collect union dues without explicit employee consent, and publishing baseline education and transportation budgets as if the surtax on incomes over $1 million did not exist to ensure that surtax revenues are not being used to backfill general budget shortfalls.    “American Citizenship: A Vision for Transparency & State Policy Innovation” is one of several chapters to be rolled out from Pioneer Institute’s upcoming book Agenda for Leadership: Choosing to Compete, edited by Pioneer executive director Jim Stergios. The book is expected out later this month. More information can be found at: https://pioneerinstitute.org/agenda-for-leadership-2026/

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Analysis shows Massachusetts has lost hard-won gains and identifies steps to strengthen academic rigor and expand proven choice options 

BOSTON, MA (January 27, 2026) – With Massachusetts students experiencing sharp drops in academic performance and the Commonwealth losing its status as a national education leader, a new Pioneer Institute report calls on state policymakers to restore rigorous academic standards, strengthen accountability, and expand proven school choice models to reverse more than a decade of decline in student achievement. 

“Massachusetts led the nation across all subjects tested from 2005 to 2013, and in 2007 our eighth graders tied for best in the world in science,” said Pioneer Director of Education Jamie Gass.  “But since then, we have dumbed down standards, reduced accountability and consistently rejected or impeded school choice options.” 

Standards      

The report finds that Massachusetts’ downturn accelerated after the Commonwealth replaced its internationally benchmarked academic standards with less rigorous ones in 2010 and then again in 2017.  State policy makers should reinstate pre-Common Core content-rich English, math and science standards and embrace phonics-based reading instruction. 

Accountability 

The report traces the erosion of accountability back to the 2008 elimination of the independent office that conducted comprehensive audits of Massachusetts school districts and culminated in the 2024 vote to repeal the MCAS graduation requirement in English, math, and science. 

The report recommends replacing the MCAS graduation requirement with fewer, strategically timed checkpoints such as state-designed end-of-course assessments. 

When the independent Office of Educational Quality and Accountability was eliminated, it was replaced by an entity within the Department of Elementary and Secondary Education (DESE) whose advisory council included representatives from school committees, teacher unions, and superintendents – the same groups the entity is supposed to hold accountable. The report recommends reinstating a truly independent school accountability watchdog. This is especially important given that the 2024 ballot initiative on the MCAS effectively pushed accountability back to the local districts. 

Massachusetts charter public schools were once the gold standard for urban education reform, delivering transformative outcomes for low-income students. Some still are, but others have abandoned rigorous liberal arts-based approaches in favor of ideological or therapeutic models that have caused steep declines in student performance.  

The report calls for charter public schools to return to a focus on the liberal arts, structured discipline, and teacher-led instruction, and urges targeted state interventions for charter schools with declining performance, including probationary status or, where warranted, non-renewal.   

School Choice 

DESE and the Board of Elementary and Secondary Education (BESE) recently imposed strictly lottery-based admissions on voc-tech schools, which have higher graduation rates, lower dropout rates, a better job placement record and more than 10,000 students on waitlists statewide.  

“Removing attendance, behavior and grades from admissions criteria increases the chance of a mismatch between student and program and is the latest example of Massachusetts punishing educational success,” said Pioneer Executive Director Jim Stergios. “State leaders should restore local control over voc-tech admissions criteria, paired with strict public reporting standards to ensure fairness.” 

Each year, Massachusetts spends over $2.5 billion on more than 24 workforce development programs that lack transparency, meaningful coordination, and consistent performance metrics. The report recommends redirecting 10 percent ($250 million) of that funding to create 10,000 new vocational-technical school seats in underserved areas.  

BESE and DESE have effectively imposed a bureaucratic moratorium by stalling charter school approvals with a burdensome review process and failing to recruit proven charter providers to apply. The report calls on BESE and DESE to prioritize the replication and expansion of high-performing charter schools and to streamline the review process for academically focused charters in underserved urban areas.  

Digital Learning 

Virtual education can be a lifeline for students with medical needs, bullying issues, accelerated learning goals or specialized interests, and can improve access for those in rural areas. Well-designed programs with strong accountability measures and trained online teachers can match or exceed outcomes in traditional schools. 

The report finds that Massachusetts lags in this area—and recommends lifting enrollment caps, stabilizing funding and adopting nationally recognized quality standards.  

“Education: A Vision for Excellence” is the third of several chapters to be rolled out from Pioneer Institute’s upcoming book, Agenda for Leadership: Choosing to Compete. All available chapters are available at https://pioneerinstitute.org/agenda-for-leadership-2026/. The Institute expects to release several education updates over the next week.  

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Study calls for enforcing transparency laws, curbing hospital market power, and reforming PBM and 340B practices to lower costs and protect innovation 

BOSTON, MA (January 21, 2026) – With healthcare costs now among the top reasons why families are leaving Massachusetts, a new Pioneer Institute report calls for the Commonwealth to focus on affordability and access and, specifically, for the state to enforce existing transparency laws, rein in hospital consolidation, reform pharmacy benefit managers, expand transparency as to how the federal 340B drug discount program is being used, and refocus the state’s  life science spending on workforce training, and oppose federal price controls that punish innovation.   

“Healthcare costs are no longer just a medical issue—they are a cost-of-living crisis,” said Pioneer Executive Director Jim Stergios.  “A system meant to heal has instead become a driver of economic flight. These reforms would restore transparency, competition, and accountability while protecting patient access and innovation.” 

The report outlines a series of practical reforms designed to empower patients, increase competition, and preserve Massachusetts’ position as a global leader in medical innovation—while avoiding blunt federal price controls that threaten research, access, and long-term affordability. 

Market Power and Transparency   

Massachusetts providers – especially large hospital systems – continue to resist meaningful compliance with state and federal price transparency laws.  Pioneer recommends establishing a Healthcare Transparency Task Force to monitor and enforce existing requirements, ensuring patients can access clear, comparable pricing information.  

The report also urges greater outreach to employers and insurers to promote cost estimator tools, along with incentives such as rebates for choosing high-value, lower-cost options, and a public education campaign to normalize shopping for healthcare. 

Hospital consolidation has further distorted prices. Large systems, including those operating under the Mass General Brigham and Beth Israel Lahey umbrellas, have used mergers and acquisitions to achieve outsized market power.  As a result, prices for routine services—such as imaging, childbirth, or joint replacements– can vary two- or three-fold within the same region, with no corresponding difference in quality or outcomes. Pioneer recommends empowering the Health Policy Commission and the Center for Health Information Analysis to review and condition market consolidation based on clear, data-driven criteria to prevent anti-competitive outcomes.  

Life Sciences 

The report calls on the Massachusetts Life Sciences Center to sunset programs generating limited returns—such as certain clinical R&D grants, equity investments, funds and DEI-focused initiatives.  Instead, the center should redirect resources toward workforce and education pipelines that Massachusetts residents for careers in the life sciences. 

Pioneer also highlights systemic flaws in the federal 340B drug discount program. While intended to support care for vulnerable populations, the program doesn’t prohibit hospitals from reselling deeply discounted drugs at full price.  The Institute’s research shows that 18 of 29 Massachusetts hospital systems significantly underperformed the national average for charity care as a share of operating expenses, even as 340B revenues surged. The report recommends requiring annual disclosure of all 340B revenues and expenditures to the state Department of Revenue. 

Pharmacy benefit managers (PBMs) represent another major cost driver. Paid based on a percentage of a drug’s list price, PBMs have strong incentives to favor higher-cost medications. This has contributed to inflated prices, reduced access, and an estimated $1.4 billion in spread-pricing revenues. Pioneer is calling for major reforms to make prescription drugs more affordable, including stopping hidden markups, removing financial incentives that drive up drug prices, ending practices that block patients from using assistance programs, and making sure any savings go directly to patients at the pharmacy counter. 

Finally, the report urges state leaders to oppose federal price controls such as those in the Inflation Reduction Act and “Most Favored Nation” proposal that reduce biopharmaceutical revenues by up to 40 percent and have already raised patient out-of-pocket spending by 32 percent. 

“Massachusetts’ life science sector was once a model for how research and entrepreneurship can drive economic growth,” said Dr. William S. Smith, senior fellow and director of Pioneer’s Life Sciences Initiative.  “Today, it is being undermined by hostile federal policies and local complacency. Without a coherent strategy, the Commonwealth risks losing its position as the world’s leading center of medical discovery.” 

“Health: A Vision for Accessible, Innovative Care” is the second chapter to be released from Pioneer Institute’s forthcoming book, Agenda for Leadership: Choosing to Compete. The first chapter, “Fiscal Responsibility: A Vision for Effective, Limited Government,” was released last week. Both chapters are available https://pioneerinstitute.org/agenda-for-leadership-2026/. 

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New Report Lays Out Practical Path to Rein in State Spending and Strengthen Local Aid

Study finds budget growth far outpaces household income; outlines reforms
that could generate $1.1–$1.8 billion in annual savings

BOSTON, MA (January 14, 2026) – With state spending growing at more than twice the rate of household income, a new Pioneer Institute study finds Massachusetts must adopt structural reforms to restore fiscal discipline and redirect savings to cities and towns—reforms that could generate between $1.1 billion and $1.8 billion in recurring annual savings. 

The report outlines a series of practical reforms—including strategic attrition, increased transparency for the Commonwealth’s sprawling quasi-public entities, expanded competitive bidding in public service delivery, targeted program means testing, and using AI-enabled integrity and cost-control tools—that together could significantly slow spending growth while preserving support for residents most in need.  

Pioneer recommends that a portion of the resulting savings be invested in non-education local aid, which has lagged far behind overall state government revenue growth. 

“With the state budget growing twice as fast as median household income, Massachusetts is asking taxpayers to carry a burden they cannot sustain,” said Pioneer Executive Director Jim Stergios. “These reforms would restore discipline and accountability—bringing spending back in line with people’s ability to pay while protecting support for families who truly need it.” 

Adjusted for inflation, the state budget grew by 28.2 percent between 2010 and 2025, while median household income rose by just 13.2 percent. State compensation costs have grown even faster, increasing 58 percent from 2014 to 2024, according to the state comptroller’s CTHRU data portal. 

One major driver of cost growth is staffing. Based on fourth-quarter FY 2025 data, roughly 4,000 employees leave executive branch departments each year. By strategically leaving unfilled approximately 910 lower-priority positions—focusing on roles with limited impact and the lowest-performing employees—the Commonwealth could reduce headcount by about 1 percent annually and save roughly $124 million per year. 

The report also calls for greater oversight of the Commonwealth’s extensive network of quasi-public entities. A 2018 Massachusetts Public Interest Research Group study identified 42 such agencies with combined annual revenues of $8.76 billion. Pioneer recommends that the next governor launch a comprehensive review of all authorities, boards, quasi-public agencies, and government-sponsored corporations to improve transparency, accountability, and cost control. 

Massachusetts also drives up taxpayer costs by unnecessarily restricting competition. The Pacheco Law, which governs privatization of public services valued at over $500,000, imposes a one-sided cost-comparison process that effectively blocks outsourcing—even when it would save money. A 2015 Pioneer Institute study found that the law alone cost the MBTA more than $450 million. The current report recommends repealing or substantially reforming the statute. 

Similarly, the study urges the Commonwealth to prohibit project labor agreements on public construction projects.  PLAs raise the cost of public construction by 10 to 20 percent by effectively preventing the more than 80 percent of the state construction workforce that chooses not to join a union from working on the projects.  

Targeted means testing offers another opportunity for savings without harming vulnerable residents. Universal free community college and free school lunch programs increasingly subsidize middle- and upper-income households, as Massachusetts already receives federal lunch reimbursements for students from families earning up to 185 percent of the federal poverty level and many low-income community college students have tuition and fees covered through federal Pell Grants. Providing full benefits up to 200 percent of the federal poverty level, with sliding-scale support up to 300 percent, would better target assistance to those most in need and could save between $90 million and $125 million annually in the school lunch program alone. 

The report highlights the potential of AI-enabled integrity and cost-control tools using deliberately conservative assumptions. Research shows that 5–15 percent of spending can be lost when integrity controls are insufficient or applied after funds are disbursed. Our analysis anchors at the lowest end of that range—5 percent—assuming that Massachusetts’ integrity controls are currently better than most states. Finally, we assume AI-enhanced controls will capture only a fraction of potential savings—roughly 25 percent of the 5 percent target in the first two years, rising to 50 percent by year four. Even under these restrained assumptions, applying AI-enabled integrity controls across unemployment insurance, procurement, and major benefits programs could generate about $350 million in near-term annual savings, rising to roughly $750 million within four years—and more than $1.4 billion annually once fully implemented. 

Finally, Pioneer recommends directing a portion of these savings to cities and towns, which deliver most frontline services even as flexible local aid has lagged far behind state spending growth. Unrestricted General Government Aid (UGGA) rose from just under $1.1 billion in FY2018 to just over $1.3 billion in FY2025—about 23.3 percent—while the enacted FY2026 state budget is projected at nearly $62 billion, roughly 54 percent larger than FY2018. The report calls for significantly increasing non-education local aid, tying annual increases to state tax revenue growth, and adding performance incentives for municipalities that demonstrate fiscal discipline and support economic development through housing growth and streamlined permitting. 

“Fiscal Responsibility: A Vision for Effective, Limited Government” is the first chapter to be released from Pioneer Institute’s forthcoming policy volume, Agenda for Leadership: Choosing to Compete. For additional information about the book, to download an excerpt or to pre-order a copy please visit www.pioneerinstitute.org (Please note an updated, specific URL for the book will be provided shortly.) 

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About Pioneer Institute 

Pioneer empowers Americans with choices and opportunities to live freely and thrive. Working with state policymakers, we use expert research, educational initiatives, legal action and coalition-building to advance human potential in four critical areas: K-12 Education, Health, Economic Opportunity, and American Civic Values.