Bay State Budget Breakdown: New Administration Offers Something for Everyone

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Joe Selvaggi talks with Pioneer Institute’s Senior Fellow in Economic Opportunity Eileen McAnneny about the contours of Governor Healey’s $55.5 billion budget and tax relief plan, and whether they serve to make Massachusetts more livable and economically competitive.


Eileen McAnneny is a Senior Fellow in Economic Opportunity at Pioneer Institute. She was formerly president of the Massachusetts Taxpayers Foundation. She was president and CEO of the Massachusetts Society of CPAs, Director of Public Policy at Fidelity Investments, and served as Senior Vice President of Government Affairs and Associate General Counsel at Associated Industries of Massachusetts.



Please excuse typos.

Joe: This is Hubwonk. I’m Joe Selvaggi. Welcome to Hubwonk, a podcast of Pioneer Institute, a think tank in Boston. The one unifying task shared by our governor and legislature is to negotiate a budget for the July 1 start of the Commonwealth’s fiscal year. While the House and Senate have stable Democrat majorities the corner office has passed from a popular Republican Charlie Baker to the newly elected Democrat, Maura Healey, who just last week started the budget ball rolling with the release of a $55.5 billion proposal to signal her administration’s priorities promising to make Massachusetts more livable for everyone. With investments in early education, transportation, housing, and the environment Ms. Healey also acknowledged the need to compete with other states for talent and investment. To that end the governor also revealed a $750 million tax relief package whose provisions on a state and capital gains tax may be intended to mitigate the blow to competitiveness caused by the multibillion-dollar income surcharge passed last year what does this budget tell Bay Staters about our new governor’s vision from Massachusetts and will this first step in the long process of budget talks cast Ms. Healey as a rubber stamp for progressive prerogatives or as a responsible steward of our Commonwealth economic and fiscal health? My guest today is Pioneer Institute senior fellow in economic opportunity Eileen McAnneny, who recently joined Pioneer after leading the Massachusetts Taxpayers Association, the premier budget watchdog in the Commonwealth for the past eight years. Ms. McAnneny will share her views on the governor’s first budget proposal and tax relief package and assess how its key features are likely to improve our livability and competitiveness if they survive the gauntlet of the legislative process. When I return I’ll be joined by Massachusetts budget expert and Pioneer senior fellow Eileen McAnneny.

OK we’re back this is Hubwonk I’m Joe Selvaggi and I’m now pleased to be joined by Pioneer Institute senior fellow in economic opportunity and my new colleague Eileen McAnneny. Welcome to Hubwonk, Eileen.

Eileen McAnneny: Thanks Joe really appreciate it.

Joe: Well it’s a pleasure to have you here this is your first time on the podcast and we’re going to be talking about what might be considered perhaps a dry subject but a necessary subject because we have a new governor and we need a new budget each year it has to it’s that that one thing that needs to start and finish because we need the money to fund all the programs but our listeners may already know that this budget, H1 that our new governor Healey just proposed it’s called H1 it weighs in at $55.5 billion and by my reckoning that’s more than a billion a week so it’s a lot of money we’re going to be talking about and there’s some let’s say related proposal she has in there so let’s start a very high level and work our way into the details so our listeners can keep up with all these numbers so let’s start at the beginning which is this I think our goal as a as a Commonwealth of the stated goal of the new governor was to make a the Commonwealth more affordable and more competitive with other states so I think perhaps we use that lens to interpret what the budget looks like. So, let’s start at the beginning share with our listeners $55 billion— how just in general historically how does that break down and you know let’s see if we can compare past and future?

Eileen: Sure, so as you say you know the governor’s budget is her proposal for the state’s operating plan for fiscal year 2024 which begins July 1st and she’s given extra time the first year she’s the governor because it’s a complicated document and as you say it’s over $55 billion that’s in line item spending but the actual overall spending package for the state weighs in at more like $62.5 billion. That’s because some things get funded right off the top and they don’t actually get appropriated through the budget. But it is a lot of money and the governor’s first budget really is an indication of what her priorities are.

Joe: OK so these are her priorities but of course this is the ball just starting to roll right now we don’t have a king we have a governor who then passes on along to the legislature who has you know many members each with different priorities that they’re going to massage this right they’re going to take some things down and add some things this is what the governor thinks is important so it’s a first draft of a budget if I’m right.

Eileen: Absolutely it it’s the starting salvo if you will right and so the governor files her budget it goes to house Ways and Means they get a chance to either reject revise except either the numbers or proposals in our budget then the Senate does the same thing. There is always differences between the House and the Senate, goes into a conference committee, and then it goes back to the governor who will have the opportunity to veto provisions. The cycle is honestly never ending throughout the year because then once they enact what they call the the final gap budget, then they start on supplemental budgets and so it’s really a never-ending cycle.

Joe: OK so that we won’t get too caught up in the details let’s just try to do broad strokes. If the governor is trying to communicate to the legislature and we the residents of the Commonwealth, what is she trying to say. Well let’s start with the beginning with what she’s proposed as far as spending. Where are—you are an expert in the budget—where are the clear differences, the initiatives that look like this is something that reflects a priority of the governor.

Eileen: So I think that the governor’s budget reflects that she is focused on are the cost of housing the cost of early education on the need to improve transportation and then you know a whole bunch of other like investments in workforce training.

Joe: So, let’s unpack that housing OK we’ve done a couple shows on the fact that it costs a lot to live here housing wise both in rent and to buy a new home where does this budget reflect an interest in helping people, either renters or home buyers, to live here in the Commonwealth.

Eileen: Well, so I think that the most noteworthy thing is she’s separating out housing in its own secretariat so she will have a direct report responsible for housing in Massachusetts and so that is that’s certainly new but that secretary of housing is charged with making sure that we expand shelter capacity so for those that can’t afford — “housing replacement for new arrivals” is actually the term she uses in in her budget remarks, access to affordable housing through rent vouchers and a whole host of other programs that I think will help those unable to afford housing. There is less involved in what I’ll call market rate housing initiatives.

Joe: So, for those who are unfortunately unable to afford a house we call this this is a very complex problem—I don’t go down that rabbit hole and talk about homelessness and those in most need—but we have on this show talked about the need for more housing. If we want to make housing more affordable we need more of them. Is there anything in there that encourages developers to you know roll up their sleeves and invest in new housing?

Eileen: So it does fund programs certainly you know that are already on the books but I did not see any new program in that respect although as you know, Joe, from glancing at it the budget is several hundred pages so that it could be in there and and I’ve yet to discover it!

Joe: Well I don’t know you know again you’re the expert I just thought I was encouraged if I’m going to sing the governor’s praises I did see a housing development incentive program that went was increased from $10 million annual cap to $50 million which again, I am not an expert in this committee, this says OK you may get a tax break if you’re willing to build housing. I guess that falls along the affordable and commutable range so am I reading that properly that for market rate housing in “Gateway Cities.” That to me was encouraging.

Eileen: You know you’re absolutely right and what I would say is as we know Governor Baker spent a lot of time on housing and trying to increase the housing stock, making just building more housing across the pricing spectrum and I think Governor Healey certainly builds on some of those programs with incremental additional funding.

Joe: Sure so let’s move on to what well we one more element of housing. \There are some you mentioned a rental supplements how—is there anything you know profound there or is it sort of steady as she goes?

Eileen: You know, I think again it’s trying to expand upon programs, acknowledging that housing costs are becoming increasingly unaffordable for a wider swath of the population and so focused on that we can you know get into in her tax package if you want to there’s also a provision that would try to help renters by increasing the deduction in help seniors stay in their home with you know income tax deduction for property taxes paid.

Joe: Sure ,I think you make a good point and I don’t want to conflate the two concepts have a budget that is what the government is spending and then there was a file alongside a what’s called $750 million Healey-Driscoll tax relief package. So I don’t want to conflate the two concepts I do want to sort of tack that on there because I think it does also reveal a great deal of what the what the governor’s priorities are so let’s come back to the — you mentioned early education improvement that seemed quite comprehensive quite a lot of detail in there. Is the logic behind that again I’m talking in broad strokes we want to make early education that is pre pre-K I suppose, a priority so that people who are let’s say two-income families uh that they’re able to work and have education and and have their children prepared for school this helps people join the workforce and be productive is that the logic behind these kinds of early education programs?

Eileen: It is. I think that one of the biggest challenges confronting the Commonwealth is the workforce shortage and that’s due to a lot of things certainly—an aging population people leaving the state and folks leaving the workforce to care for young children or the elderly right so there’s a lot of reasons why people aren’t working and I think the governor acknowledges that and so her approach is multifaceted you have to increase childcare availability, certainly for people who can pay, and also subsidies for those who need some help and so she does both.

Joe: So, a scenario would be a nurse with two young children at home might be able to work if her children have adequate daycare or early education so that that senior in Massachusetts gets the nurse that she needs the nurse gets her job and the kids  get some early education?

Eileen: Absolutely yeah it’s an ecosystem if you will.

Joe: OK now you mentioned that the next priority I wrote it and then completely—transportation it seems there was a great deal in there of course we’re treated to daily stories of the T, whether it be ceiling tiles falling or trains colliding, we would love to see the T fixed, what is in this budget for transportation, not just the T, but everything?

Eileen: There’s a lot of money and the money comes from the income surtax that was passed by voters last November because as you may recall it says the money has to go or is intended for education and transportation, and so the governor’s budget estimates that there’ll be about a billion dollars from the income surtax that comes in in fiscal year 2024, and she divides it between education and transportation. So there’s about $490 million in new investments in transportation. A lot of it is for highways, right, making sure the bridges our sound and safe but a lot more of it goes to capital investments in the MBTA to improve stations so we don’t have falling ceiling tiles and the like.

Joe: I don’t want them falling on me either so those of us—I’m glad you brought this up— I didn’t mention it again I think it seems to me from my reading of the budget she was very good at separating out that additional money we’ll call it the millionaires’ tax or fair share tax or whatever word we want to use for it, but we’re estimating roughly a billion dollars in addition to the revenue that comes in let me just start a little bit back we talked about how much spending all of this is based on revenue and most of it’s coming from income taxes and we’ve been pleasantly surprised even through COVID that the income taxes have been robust how much does this proposal increase spending over the year prior—essentially not what did the governor last year proposed I think Governor Baker had proposed a much smaller budget and ultimately as you say when it made it all the way through the gauntlet of the process it was a larger budget but let’s say relative to what was spent last year what is the governor proposing. Is it a larger number, a smaller number or you know much larger number?

Eileen: So, it’s a larger number it represents about a 4.1% year over year increase in spending but it’s not necessarily an apples to apples comparison because part of that increased spending comes from the income that will come from the income surtax which didn’t exist last year right so a billion dollars in increase spending is due to the estimated increase in income taxes the state anticipates collecting.

Joe: And as a matter of housekeeping for those of us who were concerned about the effects of the millionaires’ tax on say the outflow of people who are affected by that tax but the promise was made that that money would be kept separate but those of us who are more critical of that plan said look money is fungible, if we reduce spending on one side of the ledger by a billion and increase it by on the other side by billing the net effect is transportation and education will get the same exact amount of money it’ll just look like it’s coming directly from the millionaires’ tax. Is there any assurance that there’s been no sort of reduction in the expensive targeted towards education and transportation in the basic budget before we then supplement it with the millionaires’ tax?

Eileen: Yeah, there is an increase in spending for both education and transportation and I think one of the important or notable policy initiatives in governor Healey’s budget is to address the very thing you talked about, right, a lot of people said the money is fungible it’s not really going to result in more spending for either education or transportation, and her budget goes to great lengths to make sure that it actually does result in increased spending because it sets up a separate trust fund so the money from the income surtax is separated out, if you will, goes into a trust fund that has to be used for education and transportation.

Joe: OK that’s good well at least the governor’s heard our concerns perhaps she’s a a big listener of the podcast, let’s hope legislators share our concerns. So, I want to talk also about healthcare I learned from reading the budget that Mass Health is the biggest single item on the entire budget but I think my big concern about healthcare is a lot of money came in from the federal government during COVID for obviously a huge demand for additional healthcare and that money I believe our emergency is supposed to expire on May 11—I don’t know what time of the day it’s going to expire but it will—and some of that money is going to go away. So, is this budget aware and does it make a preparation for all those people who are relying on federal aid to now you know that that aides going away. Say more about our health.

Eileen: Sure, so Mass Health the state’s Medicaid program as you say is the biggest single line item in the budget and the estimates vary but it’s roughly about 40% of the state budget and so it’s a big program and any kind of expansion in eligible folks for it has a big impact on the budget and because of the public health emergency that the federal government had declared during COVID and has continued and remains in effect to this day, there are a lot more people on Mass Health than there has been historically, about 400,000 people, and that’s because the federal government said hey we’re going to give you more money as part of our share of the cost but in return you can’t kind of kick anyone off of the Mass Health program and so right now there are about 2.3 million people that are enrolled in the Mass Health program and when that federal health emergency ends they’ll be able to begin what they called the recertification and they’re expecting that those numbers will decline by about 400,000 people.

Joe: Roughly the numbers they were trending before that the COVID so we’re not going to use the word kick off but 400,000 people will be let’s say in the future no longer eligible for what they were eligible for in COVID and some of this funding is to sort of ease the pain if you will or create—I saw a mention of the term off ramp, off ramp from COVID these are these are supplemental expenditures—how does that how does that lay out is it just Mass Health or are there other programs?

Eileen: Well, Mass Health is certainly the largest one and it has the greatest budgetary impact.

Joe: OK alright so I I’m you know starting from the big stuff and moving on down to the smaller stuff within the context of education which is a huge element there’s a commitment again to educating the workforce I see a lot of a money dedicated to making sure folks go to college early education we already talked about say more about how this reflects with what the governor thinks is important as far as education?

Eileen: So education is a big priority of the Healey-Driscoll administration and you can see that in the budget as you say they make investments really all along you know the education spectrum so starting with early education there are investments in both provider rates and the amount of subsidies. You go to K through 12 education and this budget fully funds the student opportunity act, which means more money for the 351 cities and towns for school aid. We also spent a lot of money on community college and there’s a pretty new and novel program initiative excuse me called mass reconnect which makes community college free for people over 25 who meet certain conditions. And then finally there’s a big investment in our higher education system with some of that money as I had indicated before from the income surtax some of that new money is devoted to higher ed.

Joe: You know we think education clearly we’re Massachusetts this is a you know the Athens of America we like education in these parts but as far as community college you know they have they have let’s say not a great track record as far as completion rates is there what we’ve talked about with education policy experts in the past is what could be even more effective might be vocational training and job training. Is there anything in there to help people you know become all those great services that all of us need?

Eileen: There is. There’s certainly money for apprenticeship programs and for vocational tech so I think that there is acknowledgement., there’s also money for it’s called early college and career pathways, but the notion is you can help kids in high school either prepare better for college by taking some classes while they’re still in high school to get acclimated  and kind of used to the whole college scene,  or you can help people who aren’t going to college to have the skills they need for a career path so there’s money for that as well.

Joe: OK so we’ve been well I think I’ve been somewhat of a cheerleader for the governor so far in this budget. I’ll say that if I had any concerns about the line items I see there’s a huge priority for what we’re calling climate and environment. We all want to see a better environment and we don’t like pollution and we won’t all want to do our part to help the climate, but I see there’s a sort of a line items for training people in climate justice or environmental justice. This gives me concerns, but I want you to help me understand what that means. Why does the climate need to be—do we need to consider justice in this environment?

Eileen: So, what I would say I mean I think that the governor has said that she wants to make sure Massachusetts reaches its carbon emission reduction goals which was set by governor Baker by 2030 and so trying to provide resources to ensure we get there but I do agree with you I think the idea of the environmental justice is a little more kind of intangible right and not sure how that will all play out. The other thing I would say is you know you had said you were a cheerleader for the budget and I think there are a lot of great things in it too, but one thing I have noticed is there is a lot of money sprinkled throughout various state agencies and for various initiatives on things like training, workforce training, and I just hope that it’s coordinated, right, and perhaps streamlined to make and that there are measures of accountability because we are spending a lot of money and want to make sure it’s having the desired outcomes, and so, you know, not quite sure what the goals of environmental justice folks would be but I think that that should be very transparent to taxpayers.

Joe: Yes indeed and almost I think it’s odd to me that when we do try to impose a stricter environmental standards the unintended consequences to make building more expensive which makes housing more expensive which makes the cost of living more expensive so when reading within between the lines of the environmental justice we’re trying to make sure that we don’t build I don’t know full power plants in low-opportunity neighborhoods but of course I think it gets the direction of that wrong. Low-cost neighborhoods may be less say less environmentally pure but that’s why they’re low, you know, that’s why you can afford a house there. If you in a sense clean it up you’re essentially gentrifying and making those people who live there’s lives albeit cleaner and perhaps better for the environment but they can’t afford to live there anymore if there’s a big beautiful park but you know but enough with my editorializing OK we we’ve sort of covered the expense part but we did say there was an attending budget tax relief part of this which is always music to all of our ears we all like tax relief describe for our listeners to contours of tax relief package.

Eileen: Sure so the governor campaigned on the notion that must she acknowledged that Massachusetts is unaffordable and less competitive and so she provided a tax package to address that and it has several components, many of which were included in Governor Baker had filed a tax package or their concepts that the legislature had entertained and there’s really five big components to it. One is a dependent tax credit of $600 and that gets to trying to help with affordability of childcare or eldercare.

Joe: Can I just ask? It’s one of my sticklers. Tax credit it’s effectively $600,. if you have a child you know $600 check even if you pay no taxes right this is not offset your taxes this is whether you pay taxes or not you get that money?

Eileen: Well so you’re right a credit requires you to have tax liability in this instance it’s a refundable tax credit so if you don’t have tax liability you get a check from the government yes Joe: OK I’ve got you know for our listeners, there’s it’s not your taxes will go down to $600 if you pay nothing they’ll go you’ll get a nice get money yeah OK.

Eileen: And then an increase in the senior circuit breaker, which is an offset on your income tax for property taxes paid, and there’s an increase in the renter’s deduction—so it used to be $3,000 it’s bumped up to $4,000 is the maximum deduction that you can take on your income tax return. And then there is reform to the estate tax. So Massachusetts has a pretty onerous estate tax one of 12 states to actually have one and the governor goes a step further than certainly Governor Baker did in his proposal last legislative session or that the House and Senate entertained and I think that’s an acknowledgement of passage of the income surtax which you know we can talk about, and then the final provision is it reduces the tax rate on short-term capital gains from 12% to ordinary income tax rate of 5%.

Joe: All good I’m glad we’ve landed here on talking about state tax and capital gains tax and you’ve sort of given a nod to the millionaires’ tax if if we have avid listeners who listen to every show they’ll know where no we were no fan of the millionaires’ tax not because you know well really for the only reason is it’s likely to have the effect of encouraging those who marginally want to stay with have considered leaving a retiring to Florida or moving to New Hampshire to avoid the income tax uh but what you’re describing is a sort of a counterbalance that we’ve we’ve disincentivized high earners from living in Massachusetts now we’re going to incentivize those who perhaps are in the estate range of $3 million or slightly above and we’re going to say look that first $3 million that you leave to your heirs is not going to be subject to an estate tax.  For those people who you know an average home in Massachusetts starting to edge up towards $1,000,000 if they leave with any efforts in their bank account they’re subject now to the millionaires’ tax as you know. If your state is a dollar more than a million, the tax is subject to dollar one right you have almost no threshold and now you’ll have what’s effectively a $3 million threshold. I think that’s going to have a healthy counterbalance, that’s going to encourage quite a few if they middle class families from either staying in Massachusetts or considering moving to Florida, this may have a very salutary effect on those decisions. What are your thoughts?

Eileen: Oh sure, I don’t disagree, right, and I think if you look at the governor’s tax package it was trying to do two things it was trying to help those most struggling you know so those that need help with their rent or seniors or on young families with children right and so on those provisions make sense I think both the estate tax and the reduction in short term capital gains was aimed at folks who may be considering leaving as you say and I think and that is also acknowledging that the income start tax was enacted right and so people who are millionaires may be considering rearranging their affairs or leaving Massachusetts and then if you add on the estate tax when we’re just you know one of 12 states with it that may be kind of a 1-2 punch right and so the idea is to mitigate the impact of the estate tax and this provision certainly does that and goes beyond what was considered last year. My only concern is it may not be enough to keep the really high income earners here if they are considering leaving, because while it makes it less onerous, Massachusetts still is only one of 12 states with any kind of an estate tax.

Joe: That’s right and again many of our listeners perhaps more progressive end of the of the ideological spectrum say well you know let’s impose a five cents cost of bags at the grocery store so people will bring their own so five cents is supposed to incentivize you to bring your bags back to the grocery store but imposing hundreds of thousands of dollars in estate tax isn’t going to incentivize you to perhaps leave and go an hour north to New Hampshire or retire in sunny Florida. Incentives matter and I think you know this this may stop help blow the bleeding but won’t stop the bleeding as you say we are only one of 12 states and the federal estate tax is much higher, I believe it’s a $12.3 million, some states have normalized it with that you know in a perfect world that would truly put us in as much more competitive. We’re looking for wealthy seniors to remain here that that might be the better choice.

Eileen: Well and that would be certainly something I think that the state should consider that’s what Connecticut does so we would be more competitive with Connecticut but it would also ease compliance it’s just much simpler right if you pay, you figure out your estate tax according to the federal rules and then it’s essentially you know taxed at the Mass rate and so ease of compliance would be another consideration too.

Joe: And discussing Massachusetts being a tax outlier taxing capital gains rates is short term at a much higher rate than the short term I don’t think any other state does that in the whole country again this is your expertise but am I right?

Eileen: Two others do and you know what I didn’t look it up so my apologies for but it’s certainly not typical right and so I I think that you know that’s another point that I tried to make in a recent blog that yes it certainly is a good step but again I question is it enough because what it does is make Massachusetts aligned with other states right with respect to taxing short term capital gains at the same rate they tax other capital gains or other income and it helps but I question whether it will make us sufficiently more competitive to move the needle.

Joe: Indeed again I think the fact that I mean we really didn’t talk about this but we’ve moved from having a say a Republican governor who clearly understands Massachusetts must compete for jobs through talent with all 49 other states you know and a new incoming Democratic governor it’s refreshing to know that she acknowledges that we have that competitive burden right we without good yeah we’ve in an earlier podcast we talked about how footloose or how how able individual residents are able to move, and you know in the distant past people with no assets were the most likely to move around you know proverbial hobos if you get on trains and work anywhere. In our modern economy it’s almost the exact opposite—your ability to move correlates with your income the higher your income the easier it is to pull up stakes and move to wherever you like you’ve got the means to do it so the more difficult we make it for high earners to stay the more likely they are to leave and you know we’re making it harder and harder for them to stay. Do you agree with that observation?

Eileen: Yeah, I mean I would say there are a couple of things going on right I I think if you look at Massachusetts where a highly educated workforce which means there are many white collar jobs which are able to be done remotely right and we saw that during COVID. Many companies didn’t miss a beat people were able to log in and and work from home almost seamlessly and and that continues ,so you are right people are able to work you know remotely more so than ever before and they’re choosing to do so because of either lower cost or higher quality of life or for whatever reason, and so Massachusetts has to worry about that because for a long time we were losing our population, our natural-born population, but we were backfilling that with immigration right and with college students who came to be educated in the state. And we are seeing certainly less immigration because of COVID, because of federal immigration policies or at least you know of immigration through either H1-B1 visas or that type of thing and so it’s really important that Massachusetts be competitive so we don’t lose more of our population than we have been historically.

Joe:  Yes and of course when you lose— if we tax someone so much that they take you know say someone earning $5 million a year when they leave they take the additional tax you’ve just imposed but also all the other taxes they have been paying before you raise their taxes .

Eileen: So they do you know and what I worry about is you know because the cost of housing is high that when people are starting out you know is Massachusetts still a viable option for them or will they go to some place where the cost of housing is less and they’re able to afford more of it, because the other issue is if people are working from home or spending more time in their home you know they want a little more room, right, and so having you know the ability to buy as much house as you can may matter more than it did even a few years ago.

Joe: Indeed they can move and they need to move because they need the wide open spaces that’s certainly at low cost housing and wide open spaces is not something Massachusetts is known for so you know they go for greener pastures both because they’re getting hit on their paycheck with taxes and because they’re getting hit in their wallets with an enormous mortgage so good points right there. So we’ve done some cheerleading we’ve done some criticizing of the governor’s plan. I like to ask many of our guests you know we’ll talk about somebody else’s work what if you were governor for a day for a year what would your—what substantial differences would your budget look like? What would you change your priorities you already you acknowledge that you try to make us perhaps more competitive and less expensive but how how would you in broad strokes improve on this?

Eileen: You know so first of all I want to give kudos you know to the governor because I mean I think she focused on the right things, right—we do need to address the cost of housing we do need to fix our transportation and I think the cost of early education you know is a barrier to folks entering the workforce right so I think that those focuses are right but what I would say is to fix education to fix transportation to fix housing it takes a little while. I mean yeah it takes a while to permit and build housing, it takes a while to make capital investments in transportation so some of the more immediate things that can be done are things like tax policy which can be implemented fairly quickly and which could have a noticeable difference and I think we’ve talked about some of them. I might have taken the reforms to the estate tax a little further and and I think you know lowering the rate on short term capital gains you know may make sense maybe it’s reducing long term capital gains rates to encourage more business type investment and so forth. And there are other costs that we can look at we haven’t talked about but Massachusetts has high unemployment insurance costs, the highest in the nation, so maybe there are some reforms that can be done there. It’s really about trying to reduce the cost of a job or hiring so you know some of that I think is important looking at healthcare costs are there ways that we can potentially take some cost out of healthcare because that is a huge expense you know for families who are paying for commercial insurance. So that would be some of the things that I would look at.

Joe: It’s good it sounds like you’ve just rattled off all the issues we’ve talked about earlier podcast episodes we try to tackle transportation and education and healthcare one step at a time but it’s a big picture and it’s very as you say it’s a long term commitment to doing the right policy and making this great Commonwealth even better so I appreciate that. I’m thrilled to have had you this is our first time together on the podcast you’re a new member of Pioneer oh I haven’t given us I should have started top of the show where were you before you joined our esteemed organization?

Eileen: So immediately prior I was at the Massachusetts Taxpayers Foundation which is you know it it’s a research organization focused on fiscal and economic stability from Massachusetts and then …  and I’ve really spent my professional career on public policy in various capacities focused on issues of importance to the employer community.

Joe: Good I appreciate it again there’s a nonpartisan and we I hope we’ve tried to stick to our guns and remain nonpartisan in this review. I think we’ve done a thorough job. Can our listeners go on to a website and drill down and learn more about the the state budget I think we can go to or something like that how will they get more detail?

Eileen: Yes, they can go to and you can look in one of two places if you look under the legislature and you click on house or Senate there’s a whole tab devoted to the budget and it takes you through each iteration, so that’s a good place to look. But also if you look under the executive branch under Governor Healey’s page you’ll see she has a click into her budget. and administration and finance is an executive agency that’s really responsible for putting together the budget they have a lot of information in there as well.

Joe: OK and where can our listeners read what you’re doing now for Pioneer?

Eileen: On Pioneer’s website.

Joe: OK all right master of the obvious here! Well thank you very much this has been a terrific first visit I hope you’ll consider joining me again in the future for future budget questions.

Eileen: Thank you Joe I appreciate the opportunity.

Joe: This has been another episode of Hubwonk. If you enjoyed today’s episode, there are several ways to support Hubwonk and Pioneer Institute. It’d be easier for you and better for us if you subscribe to Hubwonk on your iTunes pod catcher. If you’d like to make it easier for others to find us, you’re welcome to offer a five-star rating or a favorable review. We’re always grateful. If you want to share Hubwonk with friends, if you have ideas or comments or suggestions for me about future Hubwonk episodes, you’re welcome to email me at Please join me next week for a new episode of Hubwonk.


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