Who is a member?
Our members are the local governments of Massachusetts and their elected and appointed leadership.
The Honorable Charles Murphy
Chair, House Committee on Ways and Means
The Honorable Steven Panagiotakos
Chair, Senate Committee on Ways and Means
State House, Boston
Dear Senator Panagiotakos and Representative Murphy,
On behalf of the cities and towns of the Commonwealth, the Massachusetts Municipal Association wishes to express our deep appreciation to you for your service as members of the Conference Committee on the Municipal Relief Bill. This letter contains the Association’s comments and positions on measures where there are significant language differences between the House and Senate, or measures that are only in either the House or Senate versions of the bill.
This legislation has been developed over a long period of time, and it is important to recognize the good work done by many members of the Legislature over the past two years meeting with local officials and considering many of the suggestions to help cities and towns save money and operate more effectively. We want to give special thanks to Representative Paul Donato for service as the House Chair of the Special Commission on Municipal Relief and House Chair of the Committee on Municipalities and Regional Government, Senator Stanley Rosenberg as the Senate Chair of the Special Commission on Municipal Relief, and Senator James Eldridge as Senate Chair of the Committee on Municipalities and Regional Government. The members and chairs of these committees spent many hours reviewing and drafting relief proposals and shepherding the best ideas through the two branches to this Conference Committee, and we offer our sincere appreciation.
We are pleased that there are many provisions in common in the House bill (H. 4631) and the Senate bill (S. 2436) that represent agreement between the two branches. We ask that all of these provisions be included in the Conference Committee report.
This letter includes our comments on most, but not all, of the provisions in the two municipal relief bills. We will continue to communicate our thoughts on other provisions, particularly proposed retirement law changes, as they are developed.
TIME-SENSITIVE PROVISIONS
There are several measures in both the House and Senate bills that are extremely time-sensitive that we hope can be enacted without delay so that cities and towns can use the provisions to balance their fiscal 2011 budgets and achieve savings throughout the year:
Pension Repayment Funding Schedule Extension: These provisions would change local pension funding rules, including allowing the extension of the pension funding schedule to 2040 to help amortize unprecedented asset losses experienced during the previous two years and mitigate the harsh impact on municipal budgets (Sections 16, 26-28 of the Senate bill and sections 1-4 of the House bill).
Municipal Early Retirement Incentive Program: This provision would create an optional municipal early retirement program, carefully targeted with strong executive branch control, requiring both executive and legislative approval (Section 103 of the Senate bill and section 11 of the House bill).
Schedule for State Certification of Tax Valuations: This provision would authorize the commissioner of revenue to revise the three-year schedule for state certification of locally-set property values. This would allow the commissioner to even the number of certifications each year, facilitate cooperative assessing agreements and improve in other ways local assessment administration (Section 45 of the Senate bill and section 25 of the House bill).
MMA COMMENTS ON PROVISIONS BY CATEGORY
Procurement and Public Construction
Payment Bond for Construction Projects
Section 91 of the Senate bill would amend section 29 of Chapter 149 of the General Laws to increase the dollar amount of state and local public construction contracts above which a payment or security bond is required for not less than one half of the contract price. The state amount is now $5,000 and the local amount is $2,000. This section would increase the state and local amounts to $25,000. There is no similar section in the House bill. This reform is a very high priority for local government officials.
Out-of-State Cooperative Purchasing
Sections 17, 20 and 23 of the House bill would amend sections 2 and 20 of Chapter 30B of the General Laws to allow local government to participate in cooperative purchasing agreements for the procurement of supplies with out-of-state public purchasing groups. The Senate bill has similar provisions in sections 6-11 and 14. We strongly support this section.
Procurement Rules for Small Public Construction Projects
Section 92 of the Senate bill would amend section 44A of Chapter 49 of the General Laws to increase the maximum dollar amount for use of the “sound business practices” procurement process for contracts, moving the current threshold of less than $5,000 to less than $10,000. Section 64 of the House bill includes similar language. We strongly support this section.
We support the following sections where the House and Senate bills have the same or similar language:
Section 3 of the Senate bill and section 14 of the House bill relative to the procurement of energy management services.
Section 4 of the Senate bill and section 15 of the House bill relative to the sale of real property between government entities.
Section 5 of the Senate bill and section 16 of the House bill relative to the GSA federal supply schedule.
Sections 10 and 13 of the Senate bill and section 19 of the House bill relative to reverse auctions.
Section 11 of the Senate bill and section 17 of the House bill relative to the definition of sound business practices.
Section 12 of the Senate bill and section 18 of the House bill relative to the procurement of agricultural products.
We support the following long-awaited technical corrections to the 2004 construction reform law that are included in the Senate bill but absent from the House version:
DCAMM Contractor Evaluation Form
Section 93 of the Senate bill would amend section 44D of Chapter 149 of the General Laws by striking subsections (8) and (9) to correct an error in the 2004 construction reform legislation. This section would assure that subcontractors remain subject to certification. Section 93 is identical to section 12 in the construction reform technical corrections bill approved by the Committee on State Administration (House 4185).
Subcontractor Performance Bonds
Section 94 of the Senate bill would amend section 44 D1/2 of Chapter 149 of the General Laws to clarify provisions in the 2004 construction reform legislation to make clear that the cost of a payment bond for a subcontractor contract is the responsibility of the subcontractor and must be included in any subcontractor
bid. This section would also require any subcontractor to submit a current certificate of eligibility to the awarding authority. Section 94 is identical to section 25 in H. 4185.
Rejection of Public Construction Bids
Section 95 of the Senate bill would amend section 44E of Chapter 149 of the General Laws to restore provisions inadvertently deleted by the 2004 construction reform law to authorize an awarding authority to reject general and sub-bids and to cancel a procurement. Section 95 is identical to section 28 in House 4185.
Pre-qualified Contractor and Subcontractor Responsibilities
Sections 96 and 97 of the Senate bill would amend section 44E and 44F of Chapter 149 of the General Laws to clarify that pre-qualified contractors and sub-contractors must provide payment and performance bonds on projects where pre-qualification takes place (and must pay the cost of these bonds) and must provide a certificate of eligibility. Section 96 is the same as section 29 of H. 4185 and section 97 is the same as section 31.
Property Tax Administration
Change Schedule for State Certification of Tax Valuations
Section 45 of the Senate bill would amend section 56 of Chapter 40 of the General Laws to authorize the commissioner of revenue to revise the three-year schedule for state certification of locally-set property values. The goals of any revisions would be to even the number of certifications each year, facilitate cooperative assessing agreements and to improve in other ways local assessment administration. Section 25 of the House bill includes similar language. This is an urgent and high priority item for local government.
Joint Assessing Agreements
Section 46 of the Senate bill would amend Chapter 41 of the General Laws by replacing section 30B that currently allows joint assessing agreements. The new language would limit agreements to 25 years. It would also explicitly allow the formation of a regional board of assessors. There is no similar section in the House bill.
We support the following sections where the House and Senate bills have the same or similar language:
Section 67 of the Senate bill and section 34 of the House bill relative to authority for the Department of Revenue to draft rules for an expedited municipal process to abate property taxes, assessments and other obligations.
Section 70 of the Senate bill and section 35 of the House bill relative the date by which taxpayers must bring certain information to local assessors.
Section 71 of the Senate bill and section 36 of the House bill relative to authority for assessors to obtain full information on taxable personal property.
Section 72 of the Senate bill and section 37 of the House bill relative to the authority of municipal assessors and any “designated private auditor” to have access to the books, papers and other materials supporting personal property tax filings.
Section 73 of the Senate bill and section 38 in the House bill relative to the penalty for property owner failure to respond to a municipal request for information from a bar to any appeal to automatic dismissal of any pending appeal at the Appellate Tax Board (ATB) unless the property owner was unable to comply with the request.
Section 75 of the Senate bill and section 39 of the House bill relative to authority for the state revenue commissioner to request and review information provided by owners of pipelines or telephone and telegraph companies in order to ensure that personal property has been accurately valued and may amend a prior year valuation.
Sections 76 and 77 of the Senate bill and sections 40 and 41 of the House bill relative to a requirement that any applicant for a personal property tax abatement must fulfill any requests by assessors for information under section 31A (see section 71 of the Senate bill).
Section 78 of the Senate bill and section 42 of the House bill relative to expanded time to add omitted assessments for personal property under section 31A (see section 71 of the Senate bill).
Section 79 of the Senate bill and section 43 of the House bill relative to expanded time to revise assessments for personal property under section 31A (see section 71 of the Senate bill).
Section 80 of the Senate bill and section 44 of the House bill relative to authority for cities and towns, at the option of the collector and the municipal executive, to issue property tax bills in electronic form for willing taxpayers.
We also support the following sections:
Interest Rate on Repaid Property Tax Abatement
Section 69 of the Senate bill would amend clause 18th of section 5 of Chapter 59 of the General Laws to allow a city to reduce the interest rate that must be paid on a tax deferral granted under this clause. Currently, the fixed rate is 8 percent. There is no similar section in the House bill.
Fees for Failure to Provide Tax Information
Section 74 of the Senate bill would amend section 38D of Chapter 59 of the General Laws to increase from $50 to $250 the fee charged to commercial and industrial property owners for failure to respond to a municipal request for information. The fees charged to residential property would remain at $50. There is no similar section in the House bill.
Municipal Finance
We support the following sections where the House and Senate bills have the same or similar language:
Sections 47, 49 and 53 of the Senate bill would amend section 7 of Chapter 44 of the General Laws to eliminate the fixed statutory terms for borrowing for certain purposes and replace them with a term based on the useful life of the asset being financed, not to exceed 30 years. These purposes include acquisition and improvement of land, construction and reconstruction of roads, bridges and buildings and other purposes. Sections 28, 29 and 31 of the House bill include similar language.
Section 48 of the Senate bill would add to the allowable purposes for borrowing in section 7 of Chapter 44 of the General Laws a revolving loan fund to assist in financing development of renewable energy and energy conservation projects on private property. Section 30 of the House bill includes similar language.
Section 50 of the Senate bill would amend section 7 of Chapter 44 of the General Laws allow borrowing for the purpose of dredging rivers, streams and other waterways. Section 26 of the House bill includes similar language.
Section 51 of the Senate bill would amend section 7 of Chapter 44 of the General Laws to allow borrowing for the purpose of cleaning up or preventing pollution by certain operating or closed municipal facilities. Section 27 of the House bill includes similar language.
Section 61 of the Senate bill would repeal section 26 of Chapter 44 of the General Laws to eliminate the fee paid to the state by cities and towns for the issuance of State House Notes for local spending. Section 32 of the House bill includes similar language.
Section 81 of the Senate bill would amend section 2 of Chapter 60A of the General Laws by adding the requirement that the due date for motor vehicle excise payments shall be clearly printed on the tax bill. Section 45 of the House bill includes similar language.
We also support the following sections:
Borrowing for Miscellaneous Purposes
Section 52 of the Senate bill would amend section 7 of Chapter 44 of the General Laws to add a general borrowing authorization for purposes not classified elsewhere with a useful life of five years or more. There is no similar section in the House bill.
Borrowing for Emergency Purposes
Sections 54 and 55 of the Senate bill would amend section 8 of Chapter 44 of the General Laws to allow the municipal treasurer to borrow funds to respond to a “sudden unavoidable event” that was unforeseen or emergency. Borrowing for this purpose requires a two-thirds vote of the local appropriating authority. There is no similar section in the House bill.
Consolidated Borrowing
Section 56 of the Senate bill would amend section 19 of Chapter 44 of the General Laws to allow cities and towns to structure debt based on a level debt service basis and not on equal or declining principal payments, as is currently required. There is no similar section in the House bill.
Streamlined Approval of Refunding Bonds
Section 57 of the Senate bill would amend section 21A of Chapter 44 of the General Laws to provide that any municipal vote to refund previously approved bonds shall not be subject to any local referendum procedures. There is no similar section in the House bill.
Streamlined Approval of Interest Rates on Municipal Borrowing
Section 58 of the Senate bill would amend section 21A of Chapter 44 of the General Laws to allow the Board of Selectmen to delegate to the municipal treasurer the authority to approve, with conditions, interest rates for local borrowing rather than convening a Board meeting to approve a rate. There is no similar section in the House bill.
Streamlined Approval of Insurance for Bonds
Section 59 of the Senate bill would amend section 22A of Chapter 44 of the General Laws to eliminate the two-thirds vote of the council/approval of the mayor requirement for approval of insurance and other instruments to secure borrowing and replace it with approval by the city treasurer and the mayor or city manager. There is no similar section in the House bill.
Reduce Paperwork Requirements for Borrowing
Section 60 of the Senate bill would repeal section 22B of Chapter 44 of the General Laws that requires that any official statement issued in connection with a municipal bond include a statement of the federal tax impact on recipients of social security benefits. There is no similar section in the House bill.
Term of Borrowing for School Projects
Section 82 of the Senate bill would amend section 6 of Chapter 70B of the General Laws to allow cities and towns to borrow for the local share of school construction costs for up to 30 years if consistent with the “useful life of the asset” limitation of section 7 of Chapter 44 of the General Laws (see Senate sections 47, 49 and 53). There is no similar section in the House bill.
Term of Borrowing for School Projects in Regional School Districts
Section 83 of the Senate bill would amend section 16 of Chapter 71 of the General Laws to extend the maximum term of borrowing for school construction projects in regional school districts for up to 30 years if consistent with the “useful life of the asset” concept under guidelines to be established by the Division of Local Services. There is no similar section in the House bill.
Regional and Cooperative Agreements
We strongly support the provisions that would allow cities and towns to enter into mutual aid agreements for public safety and public works purposes:
Statewide Public Safety Mutual Aid Agreement
The Senate in section 44 would amend Chapter 40 of the General Laws to add a new section (4J) that would establish a statewide public safety mutual aid agreement to provide for cross-jurisdictional provision of emergency services and materials. Participation in the agreement would be at local option by the municipal executive. Section 6 of the House bill includes similar language.
Statewide Public Works Mutual Aid Agreement
Section 44 of the Senate bill would amend Chapter 40 of the General Laws to add a new section (4K) that would establish a statewide public works mutual aid agreement to provide for cross-jurisdictional provision of public works services, materials and facilities. Participation in the agreement would be at local option by the municipal executive. Section 6 of the House bill includes similar language.
Other Provisions
We support the following section relative to ambulance transport requirements:
Section 48 of the House bill would amend Chapter 111C of the General Laws to provide that when a class I, II or V ambulance is transporting a patient receiving care at the paramedic level of advanced life support, the ambulance must be staffed by at least two emergency medical technicians (EMT), one of whom must be at the EMT-Paramedic level. Under current regulations, both EMTs must be at the EMT-P level. In some cities and towns, there are instances when there are not two EMT-Ps available which can delay patient transport or divert EMT resources that are being uses elsewhere. There is no similar section in the Senate bill.
We oppose the following section relative to ambulance transport payments:
Section 49 of the House bill would add a section (section 3C) to the state’s fair insurance practices statute (Chapter 176 of the General Laws) to make rules governing payments by insurance companies to ambulance service providers. There is no similar section in the Senate bill.
We support the following sections:
Energy Revolving Loan Fund
Section 62 of the Senate bill would amend Chapter 44 of the General Laws by adding a new section (section 53E ½) that would authorize cities and towns to establish by bylaw or ordinance an Energy Revolving Loan Fund to provide loans to owners of private property for energy conservation and renewable energy projects. Sections 30 and 33 of the House bill include similar language.
Municipal Ballot Question Summary
Section 66 of the Senate bill would amend Chapter 53 of the General Laws by adding a new section (section 18B) that would permit cities and towns, upon local acceptance by the governing body, to print information on each question set to appear on the local ballot, including the text of each question, a fair and concise summary and arguments for and against to be sent to each voter in the municipality prior to the election. There is no similar section in the House bill.
Fiscal 2010 Snow and Ice Cost Deferral
Section 105 of the Senate bill would allow cities and towns to amortize over fiscal years 2011 and 2012 all or a portion of any fiscal 2010 snow and ice spending deficit. We request that the last sentence of this section be struck, as it would likely make the option unavailable to almost every municipality.
Construction Trench Inspection and Permitting Mandate
Section 106 of the Senate bill would exempt from the trench permitting law any trench that would be excavated and backfilled on the same day.
Chapter 40B Cost Certification Audits
Section 111 of the Senate bill would require the state’s Inspector General to contract wit a third party to audit all project cost certification under Chapter 40B after January 1, 2004. There is no similar section in the House bill.
Automated Traffic Control Systems
Section 112 of the Senate bill would direct the Executive Office of Public Safety to conduct a study of the feasibility of the use of a “traffic control signal violation monitoring system” by cities and towns. There is no similar section in the House bill.
The MMA appreciates your consideration and passage of this legislation. Across the Commonwealth, municipal leaders look forward to the package’s swift passage so that they can utilize these tools, resources and efficiencies as they navigate an extremely difficult and painful local budget season.
Thank you very much.
Sincerely,
Geoffrey C. Beckwith
MMA Executive Director