From the Globe
Patrick aides said Romney administration officials had been painting a grim picture of state finances in private meetings last month and this month. In the Nov. 27 presentation to Patrick’s budget advisers, Romney aides projected a budget deficit for fiscal 2008, which begins in July, of between $400 million and $1.1 billion.
The deficit assumed that state tax revenues would grow by 3 percent.
That number was also contained in an official bond document the Romney administration sent to the US Securities and Exchange Commission on Nov. 10.
This week, however, Romney aides publicly released a budget blueprint that predicted revenues would increase by 4.8 percent, which would lessen any potential deficit. The blueprint also ignored some expenses, including funding some pension debt.
“It’s a self-serving, political document,” Crosby said.
“What they said to us a month ago,” he added, “was honest and appropriate and off the record. What they’ve done is go back and tweaked all the assumptions so Romney can say he left a balanced budget.”
The Romney spokesman, Eric Fehrnstrom, declined to comment on what Patrick’s aides see as a discrepancy between the private briefings and the rosier public blueprint.
Fehrnstrom painted a rosier fiscal picture, saying, “State revenues are at an all-time high and continue to grow. The stock market is booming. Thousands of new jobs are being created every month. The economy is expanding. The challenge with the state budget is not a depressed economy, or a collapse in state revenues, which is what Gov. Romney faced in 2003. The challenge with the budget is overspending by Democrats in the Legislature.”
Massachusetts Taxpayers Foundation President Michael Widmer said Romney’s own secretary of administration and finance, Tom Trimarco, portrayed the state’s finances in a bleaker light when he briefed a Patrick transition advisory group, on which Widmer served, in early December.
“That statement (by Fehrnstrom) suggests our economy and fiscal affairs are in strong shape. That’s not the case,” said Widmer, who also served on Republican Gov. Paul Cellucci’s transition team. “They (Trimarco and staff) painted a very bleak picture of the 2008 finances.”
Widmer said income tax and sales tax receipts constitute about 80 percent of the state’s revenues, but a soft job market has caused revenues to grow at a slower pace. The strong revenues in the last two years were fueled by corporate profits and high receipts from capital gains taxes, Widmer said.
“It is not realistic to expect that will continue,” he said.
House Ways and Means Chairman Robert DeLeo said the budget grows every year because certain fixed costs — including health care, pension obligations and utility costs — increase each year. But if revenue growth fails to keep pace with the budget increases, a deficit results, and DeLeo said he also believes revenue growth will decline in fiscal 2008.
“Right now the biggest issue is the lack of jobs,” he said.
