Washington, D.C. – The Council for Citizens Against Government Waste (CCAGW) today wrote a letter to Gov. Deval Patrick (D-Mass.) regarding several sections of the Municipal Partnership Act.  The letter expressed the following concerns:

Telecom tax.  The bill’s attempt to close “loopholes” in the telecom industry by requiring them to pay property taxes on poles and aerial wires is short-sighted and will only burden the consumer.  Taxing business is a crafty but insincere way of fooling citizens into thinking they are not paying for the cost of increased government spending.  Months from now, consumers will note that their cable or phone bill has gone up and will blame their telecom company, not realizing the politicians on Beacon Hill are the ones that caused the problem.  If this business tax is allowed to stand it will be nothing more than a hidden sales tax.  It will also stifle future telecom growth and innovation in Massachusetts.

Meals and lodging taxes.  This proposal will allow cities and towns to raise lodging taxes and impose a meal tax of up to 2 percent of gross receipts to generate tax relief to senior citizens.  Again, as with the telecom companies, lodging establishments, restaurants, and other food establishments will pass along these costs to the consumer.  As always, the tax hikes will harm citizens, particularly those with a low or fixed income – usually the very people that politicians purport to want to help.

Pension funds.  While the proposal for fixing underperforming municipal, county, and authority pension funds by having the state retirement board take control may sound reasonable, local government pension managers should have been called to task for failing to adequately perform their jobs in the first place.  It would be better to privatize the entire pension system by creating defined contribution plans rather than using defined benefit plans.  Employees should contribute, possibly with some matching state funds, to personal accounts such as a 401(k).  Combining local funds with the state pension system presents a financial threat to taxpayers, especially since too large of a percentage of state pension money is going into risky and highly volatile hedge funds.

“Gov. Patrick has been in office less than two months and is already proposing to raise taxes and increase the size of government without attempting to eliminate underperforming or wasteful government programs,” wrote CCAGW President Tom Schatz.  “We hope in the next two months – and beyond – Gov. Patrick will remedy this problem.”

The Council for Citizens Against Government Waste is the lobbying arm of Citizens Against Government Waste, a nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government.