Chamber Dollars at Work

The North Shore Chamber of Commerce...
continues to play a major role in efforts to reduce the cost of doing business in the state of Massachusetts, retaining well-paying jobs, and improving the quality of life for the region. The Chamber's Board of Directors is currently monitoring the following legislative items for its 2002 agenda:

January Legislative Affairs

Small Business Administration
SBA Disaster Loans are now available to Massachusetts businesses affected by the September 11 events or subsequent federal actions. Eligible small businesses that have directly impacted and have suffered substantial economic injury can apply for working capital loans of up to 1.5 million at 4% for up to 30 yaers. Loan proceeds can be used to pay fixed debts, payroll, accounts payable and other bills that could have been paid had the disaster not occurred. The SBA is a major factor in Massachusetts as well as the nation. America has over 25 million small businesses that employ more than 58% of the private workforce and generate more than 51% of the nation's gross domestic product. Also, they are the principal source of new jobs. If you feel that your company has been directly impacted by the events of September 11, you may contact the SBA in Boston at 1-617-565-5590 for further information.

Rte 128 Improvements
The North Shore Chamber has actively advocated safety improvements to Rte 128 specifically in the stretch between Lowell Street Peabody and 1A. The route is so heavily traveled that a single accident can backup traffic for several miles. The problem is really bad at the numerous off ramps at Endicott Street, Rte 35, Rte 62 and Rte 1A. The Massachusetts Highway Department has announced plans to remedy these problems, but with the decline in state revenues, funding may become a problem in the 2001-2002 fiscal year. The Chamber will continue to pressure the MHD to go forward with the plans to eliminate the problems at these intersections.

Municipal Finances
Driven by extraordinary increases in state aid and a boom in new construction, overall municpal finances reached a high water mark in fiscal 2001, according to the Massachusetts Taxpayers Foundation. Looking ahead however, cities and towns can expect declining fortunes as they grapple with limited increases in state aid and an economic recession. With the state confronting huge deficits in 2002 and beyond, municipalities will have to live with drastically reduced, yearly increases in state aid. The economic slowdown also will limit the pace of new construction and the resulting growth in property tax revenues. Basically, the cities and towns will have to increase local real estate taxes within the limits of prop 2 1/5 and possibly reduce staff and some services. Forecasts of a rebound in the economy range from the spring of 2002 till the third quarter. Let's hope its early. (Data courtesy of the Massachusetts Taxpayers Foundation.)

Expanded Health Plan Liability
Proposed Legislation to expand the legal liability of HMO's wold cost Massachusetts employers and taxpayers between $138 million and $563 million annually, according to a report released by the Massachusetts Taxpayers Foundation. There are two bills before the legislature (S1813) and (H3377). According to Senator Berry's office, no action can be expected on either bill until sometime in the first quarter of 2002. Also, the bills will probably be rewritten to reduce the financial impact "no more boom times." the Chamber has taken a position opposing this costly legislation as they would do little or nothing to improve the quality of health care in the state.

MCAS Tests Results
According to recent test results, the corner has been turned in Massachusetts' drive to improve student achievement and reform our public schools. Statewide, the percentages of 10th graders who passed the MCAS English test climbed from 66% in 2000 to 82% in 2001, and for math from 55% to 75%. Sixty percent of those who did not pass on this first try scored within 4 points of 220, and would appear likely to pass MCAS retests after participating in extra help programs this year. We still have a long way to go, but all the people who participated--students, teachers, school and district administrators, business and community leaders, policy makers---can take pride in the progress that has been made. The Chamber has been a staunch supporter of the MCAS program since its inception eight years ago.

PG & E Salem Harbor Station
In April 2000, PG & E announced a $400 million investment plan which would convert the facility to an all-coal power plant that would meet new tougher state environmental regulations. The plan was due to be filed with the state prior to year end 2001. However, PG&E is currently reviewing its plans that may result in a lower investment than originally proposed. The extent of PG&E's investment in Salem could have tax implications for the city. PG&E's tax payment dropped this fiscal year from $8.7 million to $7.7 million, and will drop another $1.0 million in the next fiscal year. Currently, PG&E pays about 18 percent of the city's property taxes. PG&E has been quoted as saying "whatever alternative we choose it will comply with the new regulations."

State Budget
As this issue goes to press, the state budget, which is five months overdue, is in the process of review by the governor and the legislature. Every thing we have learned to date points to the need for some sharp cuts and real belt tightening. The final results will be covered in the next journal.