Taxes: “I suport the income tax rollback to 5.0 but it needs to be done responsibly. Not tomorrow, in an election year. Not just by saying we’ll do it tomorrow. We have to have a plan. The voters did vote for it. I think if you’re going to run as a Democrat and not make a commitment to keeping taxes in line — if you run like Walter Mondale promising to raise taxes — you’re going to lose.” The property tax problem, he said, may moderate as real estate price increases diminish.
Health Care: “I do give the legislature credit for building consensus to do something.” He supports the idea that small companies should be allowed to collaborate to get better rates. “Big companies do not generate economic growth or jobs. Anyone who does not understand that is completely ignorant of where ecomic growth comes from,” he said. “A healthy corporation should be able to pay $295 per year for care that costs $350 per month. There is a question about how to get at least some large employers to completely cover their employees,” he added.
Corporate Taxes: “Corporate taxes have gone from 14% to 4% in Massachusetts over the past 20 years. They are not pulling their weight,” he said.
Cape Wind: “I am generally in favor of renewable energy. My general inclination is to say we need the project.” He said he wants to make sure the deal is fair. He cited the “wireless spectrum give away,” as an example of a public-private business deal that was excessively weighted to the private side. He reminded us that Cape Wind is a private company that wants to make a profit. “Boy is it important to be a careful regulator of a long-term investor-driven project,” he said.
The regional greenhouse gas initiative: “Outrageous that we withdrew.”
Finally, on the subject of blogs: “I don’t see much of a real discussion on the issues. I don’t think that’s good. I want to talk about specific things we can do. If those ideas get ripped off and incorporated into the program of someone else who wins, that’s an acceptable second prize. You can lose, but still make a contribution.”
For the record, we have now spoken at length with two of the three candidates for Governor. Our extensive and impressive conversation last summer with Deval Patrick drew a lot of digital ink. Reilly’s office, so far, however, has not responded to several requests for interviews. Should we start taking the AG’s measurements for a chicken suit? Inquiring minds want to know.
I don’t see how the “noblesse oblige” commentary at the beginning was necessary. It puts the rest of the post in a seemingly biased light, that for whatever merit Gabrieli’s candidacy has in this race, that he is some elitist who is running so that he can care for the masses. Deval Patrick is very wealthy as well, though no comments of this sort have been levied upon him, perhaps because he’s not throwing any of his own fortune into the campaign.
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Gabrieli’s a self-made man, like the others in this race. He didn’t inherit his wealth, but made it using hard work and talent. I’ve spoken with him numerous times, and he’s a down-to-earth, genuine individual who has already given back to his community over the last decade. This “snob” stuff has to stop.
I’m wondering if something has been paraphrased or ad-libbed here. Did Chris actually say that stuff about Men of Property and Nobless oblige? That is really weird, since it would be positioning himself as a Rich, Chauvinist and an Aristocrat.
Sorry if it wasn’t clear. That was my preface. I’ve updated the post to make it more clear.
Nice comparison.
Big companies do not generate economic growth or jobs. Anyone who does not understand that is completely ignorant of where ecomic [sic] growth comes from
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He may be absolutely right, but that statement comes off as a bit curt. He’s got to learn to sound like a nice guy. It really matters.
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I’m a Patrick guy myself, and I don’t know who’s running 2 right now. I like Reilly’s immigration stance better, but I think Gabs is greener. I haven’t been impressed with either of their behavior — Reilly’s gaffes with a running mate and Gabrieli’s $15.36 million dollar bad joke are both turn-offs.
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Still, Gabs seemed to soften his Cape Wind stance. I had thought that he was “for” the Cape Wind project, not “probably for and healthily skeptical of” the Cape Wind project. Is he simply playing the middle ground between Reilly and Patrick?
I guess the 550 jobs which will be created at the Bristol Myers Squibb facility in Devens somehow don’t count.
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What’s shocking is that O’Brien made the EXACT same mistake in 2002.
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From Mass Inc:
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Romney poked fun at a comment made by Democratic candidate Shannon O’Brien the previous week. O’Brien said the state should invest in smaller, local companies instead of “distant dinosaurs” from out of state. Romney told the audience: “There are 13 Fortune 500 dinosaurs located in Massachusetts. . . .They employ more than 100,000 people. Those are great jobs. It is absolutely my commitment that no company gets treated like a dinosaur, that every job is fought for and no job becomes extinct.” He accused O’Brien of not understanding how the economy works. O’Brien responded that Romney took her comment out of context and that she wasn’t referring to companies like Fidelity that are already based in Massachusetts, but to large corporations based elsewhere.
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I wonder if DP (Fortune 500 guy himself) or TR will pick up on this.
It’s not the function of a state to “invest” in anything, if investing means direct investment of state funds or tax breaks to promote or “target” particular industries. Would you trust Beacon Hill to mamage your retirement portfolio? Didn’t think so. Then why should they have the power to “invest” — directly or indirectly — in anything?
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O’Brien’s statement failed on 2 levels. First, it’s more that retention. Who wouldn’t wanted Boeing to have relocated to Boston instead of Chicago. Are we nuts? Of course we should be speaking with many Fortune 500 companies. Whether they buy the sales pitch is another matter.
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Second, claiming she’s for “investing” in small business can be, and likely was, misconstrued as Shannon’s desire for some sort of official government support for small business — tax breaks, loan guaranties, direct financial funding, etc.
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Gabreili should know better. Hiking corporate taxes just makes employers sour on relocating or starting up in MA (on top of our high cost of living.)
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If he were on the board of directors, he would seek to locate his company in a state that keeps corporate taxes low, keeps employment costs low, keeps regulations reasonable … oh wait. We’re exactly the opposite!
On housing: “We need to think harder about how to get housing in to places where people want to live, not just where there is a hard time getting housing now. We need to get housing to places like Worcester and New Bedford.”
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Raise of Hands!
Who wants to live in New Bedford or Worcester?
3,200 more people wanted to live in Worcester 2000-2005. It’s cheaper.
but the emphasis placed on improving overall quality of life in Worcester over the last few years has been staggering. Having lived in Worcester all my (short) life and having traveled extensively, I’ve finally come to realize that Worcester is not lacking anything that conventional wisdom says only larger cities can provide; but marketing those offerings to outsiders and cultivating new residents is key. As energy costs continue to rise a reverse urban migration is inevitable and increased investment in our cities is unavoidable. Worcester is perfectly seated to handle an increase in population and development and still remain affordable in comparison to other NE cities. Gabrieli is spot on, on housing.
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Sorry for the tangent. Defensive Worcesterite and not so defensive Gabrieli supporter here.
I’m available for one on one tours of the motherland for those in need of conversion.
An increase in population does not necessarily mean people “want” to live there. Talk to refugees and immigrants.
You have too think son, before you write. And same goes to your little friend stormv.
Is this comment correct? It sounds like the opposite of what he might have said, which is “we need to get people to want to live where the housing is”.
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That, in my opinion, is a very key issue. Instead of trying to develop every square acre of this state because people want to live in low-density communities due to the high-quality schools and high quality of life (because living 2 acres from your neighbor reduces such issues), we should be trying to make the quality of life and schools superior in the high-density communities so that people want to live there. That solves many more problems than dropping condos in Dover.
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If the job is done correctly there should be no difference in the price of the same house across different nearby communities. The current huge differences is clearly an indication that the system is broken, that high prices are due to the prices themself — in otherwords, economic self-segregation.
Chris Gabrieli grabs bits of Tom Reilly’s and Deval Patrick’s policy statements and sits perched on the fence ready to jump to the side that looks like it’s winning. And then he worries that other candidates might “rip off” his ideas.
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On Cape Wind – He says he wants it to be a fair deal but he likes idea of alternative energy. Do your homework, Chris. I know you entered the race late, but be more specific. What part of the deal is bad or unfair? Tell us. Does it outweigh going back to square one with another company ? Can we negotiate a better deal? How come the Reilly “bad deal” talking point is just being brought up now? Before it was all about safety, fishing and scenery?
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On the income tax “rollback” – Gabrieli’s against it. Exactly the same position as Patrick. We can’t afford to do it now. But Gabrieli says he is “for” the rollback. What does it all mean?
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Corporate taxes and healthcare: Higher taxes for corporations and more contributions to healthcare. Right on, Chris. . . I think. “There is a question about how to get at least some large employers to completely cover their employees.” But, but . . . never mind.
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On blogs: Why doesn’t Gabrieli give more specifics when he is interviewed online if he wants to see those issues discussed in more detail? Were there more details given in the interview than in the synopsis? And this lack of detail online differs from electronic and print media, how?
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As to the second part of the answer, about people “ripping off” his ideas – where did that come from? What do blogs have to do with other candidates stealing ideas? I don’t understand. That’s like someone who passes in his term paper late accusing the guys who turned theirs in on time of cribbing his ideas off the Internet. Weird.
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Disclaimer: Patrick supporter and proud of it, man.
Did Gabrieli really say that property taxes may moderate as real estate price increases diminish? Actually, I doubt it. If he did, then that is quite an uninformed statement. The total value of real estate in a city or town has absolutely nothing to do with the total taxes collected. Assuming no increase or decrease in spending or state aid, when values increase, the tax rate decreases. When values decrease, the tax rate increases. It’s that simple.
I think, was that as the increase in housing prices moderates, the total amount that people will have to pay in property taxes will also moderate. When people say that their property taxes are going through the roof, as it were, they don’t necessaily mean that the rates have increased. They mean they have to pay a lot more than in previous years because the assessed value has increased. That’s what he is saying will become less of a concern as the housing bubble deflates and the rate of increase in property values diminishes. That’s perfectly reasonable.
But again, this just isn’t true.
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If a community’s property values go up 50%, and the community raises the maximum amount, people’s taxes will go up 2.5% — as long as every property in the town increases by the same percentage.
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If one neighborhood goes up more than another, then the people in the increasing value neighborhood will see a higher increase, but the people in the other neighborhood will see less than a 2.5% increase because the overall increase will just be 2.5%.
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Businesses add more variability. Businesses do not appreciate at the same value as residences, so if a lot of the taxes are paid by businesses, and the town does not have a split rate, then businesses will pay less of the total taxes and all residences will see more than a 2.5% increase. But the town only sees a 2.5% increase overall.
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When you hear talk of “average single family tax bill” this can be very misleading. Towns are focusing mostly on high-end housing these days. No one wants to build housing at less than their average housing value because it means less per-house income from the new house than they are used to seeing. Towns want to cherry-pick higher-end [usually lower expense] residents.
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If you can consistently add houses to the stock that are 50% higher than the average house value, the “average single-family house” value will increase, but that doesn’t mean that the people who own the older houses are seeing big increases. It just means that the average is increasing.
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The other variable is that a town is free to increases taxes LESS than 2.5 over the previous year, but they retain the right to “make up the difference” later. So a town could have 0% increase one year, but then they could have a double increase the next year. That may be where some people are getting hit now, but in fairness, they had it good in the past.
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If the housing bubble decreases there could be a big problem in some communities, because there is a hard cap on the amount that the tax rate can be — $25/1000. If suddenly houses are worth 1/5 of what they are today, that will mean that some communities will have to lower their entire levy to get the rate down to $25. That hurts some towns more than others in an unfair way.
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Let me give a simplistic example. Let’s say that Town A has 10 $200k houses and a $12.50 tax rate. They bring in $25k in revenue.
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Let’s say that Town B has 10 $100k houses. To bring in the same $25k, they would need a tax rate of $25.
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Now let’s say that housing prices decrease by 50%. Now town A has 10 houses valued at $100k. They increase their tax rate to $25 and they bring in the same revenue.
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But Town B has 10 houses valued at $50k. They can’t increase their tax rate because there is a $25 cap, so they have to simply accept 50% of the revenue. Now Town B has $12,500 in revenue, Town A has $25k in revenue.
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Town A can only make that difference back through overrides. If no overrides are passed, then each year both towns are allowed to increase their levy by just 2.5%. So each year Both Town A can add $625 to their bottom line, but town B can only add $312 to their revenue. Town B is crippled compared to Town A. And here’s the double-whammy — without overrides Town B will never to the level that Town A is at — even if Town B has higher property value increases than Town A! Why? Because the increase is based on just 2.5% more than what they had last year. It’s like running a race with cars that have fixed acceleration, but some start ahead of others.
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This is why cities and towns got hammered with Proposition 2.5. The law was designed to fit all, but the cities and towns took it on the chin. Taxpayers were probably not paying tremendously more in the cities and towns that had over $25 for a tax rate, its just that their properties were worth less. Those towns had to cut services below the level of surrounding cities and towns, and the wealthier residents fled in response to the cuts.
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That was the exact design of the proponents — groups like Grover Nordquist’s Americans for Tax Reform, which tout the “grouping” effect of tax limits, where people move to communities according to their willingness to pay. Problem is, the service levels are also grouped. In other words, the policy is designed to achieve economic segregation.
My tax bill (I live in Medford) went up over 60% in the last four years because my home has appreciated and is being assesed at it’s full value (it wasn’t previously)
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I don’t understand how you can say rising home values do not increase the amount of tax paid by individual home owners. I read through your post and still can’t reconcile it to my rise of 60%.
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When I speak of rising home values, I’m not talking about cases like yours, where your home was undervalued compared to others. I’m talking about the increasing real estate prices which generally hit everyone in a town equally. My post specifically says “if all other houses in the town rise at the same rate”.
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Your case is unusual, it sounds like your house was valued at 40% of its true value. The 60% increase in assessment, bringing it up to its true level, made your taxes jump 60%. Another way to look at it is that you underpaid your share when it was undervalued. If it was properly valued from day 1 you wouldn’t have had that problem.
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People always subscribe to the myth that the town increases your valuations to wring more money out of you. That is an absolute falsehood, the valuations only determine WHO pays the taxes, not how much the town receives.
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Situations like yours seem to be a simple failure of the assessor in your town. I’m always amazed at how easy an underassessed property is to pick out, I don’t know why the computers that the assessors’ use can’t do the same thing. Maybe the computers are what is causing the problem, when people don’t look at these things the wild inconsistencies come up.
If you look at Medford on the state DLS website, you’ll see that they held back levy capacity — in other words, they didn’t increase taxes as much as they were entitled to for several years. They made up for it in subsequent years. For example, Medford could have taxed $57.4m in 2001; they taxed $56.3m. They could have taxed $59.6m in 2002, and they taxed $58.9. If they had taxed to the limit in 2001 and 2002, the increase would have been $2.04m, but since they made up for past undertaxing the increase was really $2.6m. The total increase that year was 4.6% instead of 3.6%.
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Medford’s total assessed value more than doubled from 2000 to 2005 (a 109% increase), yet the amount of tax levy (the total taxes that can be collected) went up just 20% — the number includes new construction, which is why it is greater than the 12.5% that it would be if it could only go up 2.5% per year.
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Medford has also played with its residential/commercial split rate to favor businesses. In 2000, businesses paid 16% of the taxes in town. In 2005, businesses paid 11% of the taxes. That means residential properties as a whole saw increases of more than 2.5%, and commercial properties as a whole saw increases of less than 2.5%.
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This data is all avalable on the state’s website here:
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http://www.dls.state.ma.us/Allfiles.htm
I understand your point now – I think.
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I do think this issue is confusing enough for Replubicans to obfuscate the claim that rising valuations for homes are the reason taxes are going up as opposed to cities making up lost state revenue.
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This is an uphill battle to explain easliy.
I’d be interested in comparing those to this one.