Budget Back in the Red as Unemployment Climbs Higher

The state’s economy continued to struggle as unemployment continued to increase to 9.3% (highest level since 1976) although still below the national rate. The most disturbing number may have been a reduction in payroll by 9200 jobs statewide in September.  Government, retail, and the hospitality industry (restaurants, hotels) were the hardest hit.  The bad economic news continued to wreak havoc with the FY 10 state budget now just four months old but showing at least a $600 million deficit despite (or may be in part because of) a 25% hike and expansion of sales taxes. 

Incredibly, the legislature through a review of current tax exemptions may be considering increasing taxes again to improve revenues to the state.  The current budget – only four months into the fiscal year – is already at least $600 million in the red and some estimate a deficit of over $1 billion for the entire year is reasonable.  Removing long-standing tax exemptions is a change in tax policy and a tax increase.    

Health Care and Health Insurance
Governor Patrick announced that the Division of Insurance will hold hearings to examine the underlying causes of the high cost of health insurance for small businesses, including excess insurer profits and administrative costs, excessive charges from providers, cost shifting from larger businesses, and best practices for small businesses to mitigate the problem.  Legislation will be filed to allow the Division of Insurance to review premiums charged and to allow small businesses to aggregate their purchasing power.  

A Harvard School of Public health poll of physicians found that half favored changes in MA health care reform with the most important change being costs.  This week’s official public recognition by the Governor and some legislative leaders of small business’s cost problems under the reform law is a major step away from the usual universal praise for the reform. 

CORI  
NFIB supported legislation to allow the owners of manufactured home communities access to criminal offender reports of prospective residents.  We continue to support efforts to improve CORI report accuracy and ease of comprehension.  We also supported the manufactured home community business owners’ legislative agenda to eliminate rent control to encourage proper maintenance of existing units and creation of more affordable housing units.