House, Senate leaders report little progress on economic development legislation

Suggest tax cap giveback will provide relief to taxpayers

THE LEADERS of the House and Senate met for the first time in three months with Gov. Charlie Baker on Monday to discuss a handful of issues left over from the legislative session, but it appears little progress was made in finding a way forward.

The three leaders emerged from their meeting in the governor’s office and reported little progress on economic development legislation that passed both branches but stalled at the end of the formal legislative session on August 1 amid concerns about whether the state could afford the bill’s $4 billion price tag and also return $3 billion to taxpayers under a tax cap law triggered for the first time since 1987.

The economic development bill contained $500 million in one-time cash rebates for residents, $500 million in permanent tax credits, as well as funding for climate change efforts, water and sewer infrastructure, and a host of other initiatives.

House Speaker Ron Mariano indicated in August that he might lead an effort to reshape the tax cap law, but subsequently backed off that stance and now says he is supportive of “what’s written in the law.”

Senate President Karen Spilka in the past has sided with Baker, who has argued the state has enough money to fund the $3 billion in tax cap payments to taxpayers and the $4 billion cost of the economic development bill.

On Monday, she acknowledged the difficulty of passing anything in informal sessions, when a single lawmaker can put off action on a bill. The one piece of legislation that does have to pass is a closeout budget bill, but there was no indication on Monday whether some elements of the economic development bill might be added to that measure.

No matter what happens, Spilka and Mariano said, taxpayers will get $3 billion in one-time tax relief. Spilka described it as the largest amount ever to be returned to taxpayers.

The two lawmakers said they will continue to negotiate about elements of the economic development bill, but said the measure could also be put off until next year. “That’s always an option,” Mariano said. “We’ll push forward and see where we end up.”

Mariano also said a bill put forward by a handful of progressives to limit how much money wealthier taxpayers would get back under the tax cap is unlikely to see action this year. The speaker said he’d like to have all legislators on hand to debate such legislation, which is impossible right now given the informal status of legislation sessions.