Massachusetts Income Tax for Education and Transportation Initiative (2018)

Massachusetts Income Tax for Education and Transportation Initiative
Election date November 6, 2018
Topic Taxes
Status Not on the ballot
Type Constitutional amendment	Origin Citizens
List of Massachusetts measuresMassachusetts Question 1Massachusetts Question 2Massachusetts Question 3Submit

The Massachusetts Income Tax for Education and Transportation Initiative was not on the ballot in Massachusetts as an indirect initiated constitutional amendment on November 6, 2018. The measure was often referred to as the Millionaire's Tax Initiative and Proposition 80.

A "yes" vote supported creating an additional 4 percent tax on the portion of incomes above $1 million for the purpose of providing funds for public education, roads and bridges, and public transportation. This tax would have been in addition to the 5.1 percent flat tax currently in effect, for a total tax rate of 9.1 percent on income above $1 million.

A "no" vote opposed creating an additional 4 percent tax on the portion of incomes above $1 million for the purpose of providing funds for public education, roads and bridges, and public transportation. This tax would have been in addition to the 5.1 percent flat tax currently in effect, for a total tax rate of 9.1 percent on income above $1 million.

This measure was blocked from the ballot by the Massachusetts Supreme Court on June 18, 2018, after the court ruled 5-2 that the petition should never have been certified by the Massachusetts Attorney General, Maura Healey (D). The Supreme Court found that the initiative violated the state constitution, which prohibits ballot measures from mixing subjects that are not "related or mutually dependent."

Raise Up Massachusetts, the group supporting this measure as well as two other measures, including a $15 per hour minimum wage initiative, and an initiative to establish a paid sick and family leave funded by a payroll tax, has been in negotiations with legislative and business leaders, retailers, and the Retail Association of Massachusetts to reach a compromise deal. Raise Up wrote in a press release regarding the court decision that they remain "strongly committed to winning a $15 minimum wage and paid family and medical leave for all Massachusetts workers this year, in the Legislature or on the ballot.”

Aftermath

In June 2018, Sen. Jason Lewis (D) of the Fifth Middlesex District said he would propose legislation in the Massachusetts State Legislature in January to amend the constitution to create an additional 4 percent tax on the portion of incomes above $1 million for the purpose of providing funds for public education, roads and bridges, and public transportation. His proposal would be identical to the ballot measure, but would not be subject to the same constitutional challenges as the ballot measure was. Specifically, a legislatively referred constitutional amendment would not be subject to the related-subject requirement. The proposal would need to pass in two legislative sessions. If it did, it could go before voters in 2022. Lewis wrote the following on Facebook:

“

Income inequality is at unacceptable levels in Massachusetts and, at the same time, our transportation infrastructure is woefully inadequate and our schools are struggling to provide a quality education to every student. If we don’t act boldly and comprehensively to address these issues, then we will put the future of our communities and state economy at risk.

”

Massachusetts Question 1, Tax on Income Above $1 Million for Education and Transportation Amendment (2022)

See also: Massachusetts Question 1, Tax on Income Above $1 Million for Education and Transportation Amendment (2022)

Representative James O'Day (D) introduced House Bill 86 (HB 86) during the 2019 legislative session. HB 86 has identical text to the 2018 amendment. On June 12, 2019, the state General Court convened a convention to vote on the constitutional amendment. The convention approved the amendment by a vote of 147 to 48 with five Democratic members absent or not voting. The state General Court held a second joint session on June 9, 2021, where they approved HB86 by a vote of 159-41, thereby sending it to the 2022 ballot.

Overview

What would this initiative do?

The measure would have created an additional 4 percent tax, also known as a surtax, on income above $1 million. Going into the election, the state income tax was 5.1 percent for all earners with taxable income. Therefore, the measure would have made the tax 9.1 percent on the portion of an income above $1 million. The portion of an income below $1 million would have continued to be taxed at 5.1 percent. The $1 million tax bracket would have been adjusted each year to reflect increases in the cost of living. The tax would have gone into effect for the tax years beginning on or after January 1, 2019. The measure would have used the revenue from the new tax to fund public education, public colleges and universities, road and bridge repairs, and public transportation. For the 2014 tax year, there were 15,422 Massachusetts residents (about 0.2 percent of the population) who reported earning more than $1 million. Proponents of the initiative estimated that it would have brought in about $1.9 billion in new revenue annually.

The chart below shows hypothetical taxable income levels with the amounts taxed at 5.1 percent and 9.1 percent, the total income tax amount for each level, and that amount as a percentage of the income—which is the actual tax rate for that income level.

Total taxable income	Income taxed at 5.1%	Revenue from 5.1% tax	Income taxed at 9.1%	Revenue from 9.1% tax	Total tax revenue	Actual tax rate
$500,000	$500,000	$25,500	$0	N/A	$25,500	5.10%
$1,010,000	$1,000,000	$51,000	$10,000	$910	$51,910	5.14%
$1,500,000	$1,000,000	$51,000	$500,000	$45,500	$96,500	6.43%
$2,000,000	$1,000,000	$51,000	$1,000,000	$91,000	$142,000	7.10%
$5,000,000	$1,000,000	$51,000	$4,000,000	$364,000	$415,000	8.30%
$10,000,000	$1,000,000	$51,000	$9,000,000	$819,000	$870,000	8.70%

Status of transportation and education funding in Massachusetts

The 2018 Massachusetts budget allocated $518.5 million to transportation spending, which was 1.3 percent of the total budget. The budget allocated $7.08 billion to education, which was 17.7 percent of the total budget. Of that, $21.4 million was allocated to the office of the secretary of education, $574.3 million to the department of early education and care, $5.3 billion to the department of elementary and secondary education, $122.4 million to the department of higher education, $515.5 million to the University of Massachusetts, $250.3 million to state universities, and $276.6 million to community colleges.

State of the ballot measure campaigns

Raise Up Massachusetts led the campaign in support of the measure. Another committee, the Coalition for Social Justice 2017-18 Ballot Committee, also registered to support this initiative. The support campaign had raised $1.97 million. These committees were also registered to support two other potential 2018 initiatives. The top contributor to the campaign was the Massachusetts Teachers Association, which provided $717,677 in cash and in-kind services. Opponents had not organized a committee to oppose the initiative. Representatives of five business groups that oppose the measure, however, filed a lawsuit against the initiative in the Massachusetts Supreme Judicial Court. The lawsuit argued that initiated constitutional amendments, such as this measure, cannot designate funds for specific uses. It also argued that the initiative violated the single-subject rule. On June 18, 2018, the court ruled that the measure did, in fact, violate the single-subject rule and was ordered to be blocked from the November 2018 ballot.

How does Massachusetts compare to other states?

As of 2017, 43 states taxed personal income—41 taxed wages while New Hampshire and Tennessee taxed only dividend and interest revenue. The remaining seven states did not tax personal income. Of the 43 states with an income tax, eight states—including Massachusetts—had a flat rate and the other states had graduated rates that varied depending on different income brackets. Compared to 2017 rates, this initiative would give Massachusetts the state with the fourth highest income tax rate for income in the states' highest tax brackets. As of 2017, three states had an income tax rate that applied specifically to income in tax brackets higher than $1 million.

Text of measure

Petition title

The petition title is as follows:

“

An Initiative Petition for an Amendment to the Constitution of the Commonwealth to Provide Resources for Education and Transportation through an additional tax on incomes in excess of One Million Dollars

”

Ballot summary

The ballot summary is as follows:

“

This proposed constitutional amendment would establish an additional 4% state income tax on that portion of annual taxable income in excess of $1 million. This income level would be adjusted annually to reflect increases in the cost of living by the same method used for federal income-tax brackets. Revenues from this tax would be used, subject to appropriation by the state Legislature, only for public education, public colleges and universities, the repair and maintenance of roads, bridges, and public transportation. The proposed amendment would apply to tax years beginning on or after January 1, 2019.

”

Constitutional changes

See also: Article XLIV, Massachusetts Constitution

The measure would have added a new paragraph to Article XLIV of the Massachusetts Constitution. The following text would have been added:

To provide the resources for quality public education and affordable public colleges and universities, and for the repair and maintenance of roads, bridges and public transportation, all revenues received in accordance with this paragraph shall be expended, subject to appropriation, only for these purposes. In addition to the taxes on income otherwise authorized under this Article, there shall be an additional tax of 4 percent on that portion of annual taxable income in excess of $1,000,000 (one million dollars) reported on any return related to those taxes. To ensure that this additional tax continues to apply only to the commonwealth’s highest income residents, this $1,000,000 (one million dollar) income level shall be adjusted annually to reflect any increases in the cost of living by the same method used for federal income tax brackets. This paragraph shall apply to all tax years beginning on or after January 1, 2019.

Support

Raise Up Massachusetts led the campaign in support of the initiative. Raise Up Massachusetts is also behind two other 2018 initiative efforts: a $15 per hour minimum wage initiative and an initiative to establish a paid sick and family leave funded by a payroll tax.

The support campaign referred to the initiative as the Fair Share Amendment.

Supporters

The following organizations and individuals were listed as coalition members or supporters of the initiative on the campaign's website:

Social organizations 350 Massachusetts for a Better Future Alliance for Business Leadership Boston Asian YES Boston Education Justice Alliance Boston Mobilization/YMORE Boston Workers Alliance Chelsea Collaborative Chinese Progressive Political Action City Life Vida Urbana Coalition For Social Justice College Democrats of MA Dorchester Bay Youth Force Empathy Ways English for New Bostonians Ex-Prisoners and Prisoners Organizing for Community Advancement Grace Team Greater Boston Legal Services Irish International Immigrant Center La Comunidad, Inc. Massachusetts Alliance of HUD Tenants Massachusetts Commission on Status of Women Massachusetts Immigrant and Refugee Advocacy Coalition Massachusetts Jobs with Justice Massachusetts Law Reform Institute Massachusetts NOW (National Organization for Women) Massachusetts Peace Action Massachusetts Senior Action Council Massachusetts Voter Education Network Merrimack Valley Project NARAL Pro-Choice MA Neighbor to Neighbor Massachusetts Progressive Democrats of Massachusetts Progressive Massachusetts Project Right Public Higher Education Network of Massachusetts Restaurant Opportunities Center Boston Rosie’s Place Rowe Resources Somerville Community Corporation United for a Fair Economy Worcester Community Labor Coalition Youth Jobs Coalition Religious organizations Brockton Interfaith Community Coop Metro Ministries Episcopal City Mission Essex County Community Organization GBIO/Fourth Presbyterian Jewish Alliance for Law and Social Action Jewish Community Relations Council Mass Council of Churches Mass Council of Rabbis Massachusetts Communities Action Network Massachusetts Interfaith Worker Justice Moishe Kavod House New England Jewish Labor Committee Pioneer Valley Project Temple Sinai Brookline Unitarian Universalist Massachusetts Action Unitarian Universalist Service Committee United Interfaith Action of New Bedford and Fall River Worcester Interfaith Labor organizations American Federation of State, County and Municipal Employees (AFSCME) American Federation of Teachers (AFT) Massachusetts Boston Teacher’s Union Labor Guild Mass Alliance Massachusetts AFL-CIO Massachusetts Nurses Association Massachusetts Teachers’ Association National Association of Social Workers – MA North Shore Labor Council SEIU 1199 SEIU 32BJ District 615 SEIU 509 SEIU 888 SEIU Community Action SHARE Worcester/HUCTW Sheet Metal Workers Local 17 United Auto Workers United Food and Commercial Workers Local 1445

Arguments

• Raise Up Massachusetts provided the following statement in support of the measure:

“

The best way to help working families and build a stronger economy for us all is to make sure that we have quality public schools for our children, affordable public higher education, and a transportation system that allows people get to school or work, lets customers get to businesses, and helps everyone fulfill their daily tasks. Without investment in these common goals, working families fall behind and our communities suffer. New revenue is necessary to rebuild crumbling roads, bridges, and paths, improve our public schools, invest in fast and reliable public transportation, make public higher education affordable, expand opportunities for healthy walking and bicycling, and give every child access to high-quality early childhood education and preschool programs. If Massachusetts is serious about helping working families and building a stronger economy, we must invest in quality public schools, affordable higher education, and a reliable transportation system.

”

• A letter from a group of economists in support of the initiative argued:

“

The initiative provides this new funding through a 4 percent additional tax on annual income above $1,000,000 a year (affecting less than one percent of all Massachusetts taxpayers). Investing in our people and transportation system with such a tax is a fair means by which to improve our economy’s performance and create greater opportunities for all residents of the Commonwealth. The economic benefits from investment in education begin with the increased productivity of the students who go through our schools and then enter the workforce. This increased productivity comes from the particular skills and ability to think creatively that the students gain, but also from the behavioral capacities they develop in schools. Beyond productivity gains, schooling yields other benefits that directly and positively affect the state government’s budget—for example, Medicaid savings, tax revenue gains, and savings in the corrections system. A well-functioning transportation system allows businesses to move goods more cheaply and efficiently, access a variety of suppliers and markets, and manage inventories more effectively. With the resulting lower costs, more firms are able to stay in or move to the state. Families gain as consumers, from lower priced goods, and as workers, with the addition of more jobs to the state economy and better access to those jobs.

”

• A study by the Beacon Hill Institute for Public Policy reported that a sales tax cut and tax-free weekend would create more than 9,500 new jobs and increase the disposable income of consumers by $362 million in the first year. The author of the report, David Tuerck, president of the Beacon Hill Institute, said, "Because of the economic expansion that the tax cut would bring about, the loss in revenue would be 20 percent less than that predicted by opponents of the measure. It is hard to imagine a more compelling case for a tax cut."

• President of the Retailers Association of Massachusetts and chairman of the Massachusetts Main Street Fairness Coalition, Jon Hurst, said, "When paired with the income surtax question on track for the ballot this fall, the net revenue effect of the combined ballot measures would be an increase in state revenue of nearly a $1 billion a year."

Opposition

The Massachusetts High Technology Council (MHTC) filed a lawsuit against the ballot initiative in 2017.

As of June 14, 2017, opponents had not formed a ballot committee to oppose the measure.

Opponents

• Massachusetts High Technology Council
• Massachusetts Taxpayers Foundation
• Associated Industries of Massachusetts
• Massachusetts Competitive Partnership
• Greater Boston Chamber of Commerce

Arguments

The Tax Foundation stated the following about the initiative:

“

The 9.1 percent top rate would expose Massachusetts pass-through businesses to the fifth highest rate in the nation. This diminishes the desirability of Massachusetts as a location for small businesses and start-ups, which are a core tenet of the state’s economic strength. Small businesses account for 97.8 percent of all employers in Massachusetts, and employ about half the state’s total workforce. Though small businesses do not have to be pass-through entities, the potential impact on those that are is worrisome. ... In general, it is sound to assume that a rate increase will not spur an immediate exodus from Boston townhomes. Relocation is often costly, difficult, and frustrating. However, in the medium term, it becomes far more likely that the wealthy will relocate to lower-cost areas if the income tax proves burdensome. A flight of the rich would have serious consequences for the state. The top 0.5 percent of Massachusetts earners accounted for 19 percent of total taxable income in 2013. While the state might increase revenue in the short run, losing these earners would greatly diminish revenue stability. Just look to New Jersey: the departure of one high net-income individual caused severe revenue instability.

”

Eileen McAnneny, president of the Massachusetts Taxpayers Foundation, said the following:

“

It’s easy to see how this would be appealing to voters. The vast majority of them are not subject to the new tax. ... You just don’t want to hurt the underpinnings of our economy with a tax that will hit investors, innovators and entrepreneurs.

”

Media editorials

Support

If you know of media editorial endorsements in support of this initiative, email editor@ballotpedia.org.

Opposition

• The Lowell Sun wrote, "That feel-good bid to pick the pockets of the state's highest earners just ran into another dose of reality, courtesy of a recent study that outlined its negative effects. [...] No matter how you slice it, robbing from those who generate jobs and already pay far more in real estate, sales and personal-property taxes doesn't add up. If Proposition 80 makes to the ballot, Massachusetts voters should reject it."

Campaign finance

Total campaign contributions:
Support:	$1,966,061.01
Opposition:	$0.00

See also: Campaign finance requirements for Maine ballot measures

Two committees—Raise Up Massachusetts 2018 and the Coalition for Social Justice 2017-18 Ballot Committee—were registered as ballot question committees in support of this initiative. Together, the committees had raised $1.97 million and spent $1.85 million, including in-kind services. The Massachusetts Teachers Association was the top donor to the support campaign, providing 36.5 percent of the total contributions. The top five donors to the support campaign provided 69.6 percent of contributions. Both of these committees were also registered to support a minimum wage initiative and a paid sick leave initiative, and it is impossible to differentiate between contributions and expenditures specific to one of the three measures.

There were no campaign committees registered to oppose the initiative.

Support

Note: Both of these committees were also registered to support a minimum wage initiative and a paid sick leave initiative.

Committees in support of the Income Tax for Education and Transportation Initiative Supporting committees Cash contributions In-kind services Cash expenditures Raise Up Massachusetts 2018 $1,144,091.98 $787,716.85 $1,063,162.91 Coalition for Social Justice 2017-18 Ballot Committee $31,633.05 $2,619.13 $30,954.39 Total $1,175,725.03 $790,335.98 $1,094,117.30

Totals in support Total raised: $1,966,061.01 Total spent: $1,884,453.28

Donors

The following were the top five donors who contributed to the support campaign:

Donor	Cash	In-kind	Total
Massachusetts Teachers Association	$229,750.00	$487,927.18	$717,677.18
1199 SEIU MA PAC	$203,500.00	$38,281.96	$241,781.96
SEIU Mass Council	$159,750.00	$39,145.78	$198,895.78
Sixteen Thirty Fund	$110,000.00	$0.00	$110,000.00
AFT Massachusetts, AFL-CIO Solidarity Fund	$100,000.00	$0.00	$100,000.00
Coalition For Social Justice	$15,000.00	$70,032.74	$85,032.74

Opposition

No committees had registered to oppose this initiative.

Methodology

To read Ballotpedia's methodology for covering ballot measure campaign finance information, click here.

Polls

See also: Ballotpedia's approach to covering polls

• MassInc Polling Group conducted a survey of 508 registered voters for WBUR between January 15 and January 17, 2017. The survey found 77 percent of respondents in support of the initiative. The research found support at 83 percent among Democrats, 78 percent among independents, and 52 percent among Republicans. Individuals surveyed between ages 18 to 29 supported the measure at 90 percent. Support fell among each age group surveyed, with the lowest being 71 percent among individuals ages 61 or older.
• Between June 19 and June 22, 2017, MassInc Polling Group surveyed 504 registered voters on the ballot initiative. Support was at 81 percent in the poll. Democrats supported the measure at 90 percent, independents at 81 percent, and Republicans at 53 percent. There was less age variation in support in this poll compared to the MassInc poll from January 2017. People between 18 and 29 supported the measure at 85 percent, between 30 and 44 at 83 percent, between 45 and 59 at 77 percent, and 60 and over at 81 percent.
• Between November 9, and November 12, MassInc Polling Group conducted a survey of 503 registered voters for WBUR. The survey found 76 percent of respondents in support of the initiative, 19 percent opposed, and 5 percent undecided. The research found support at 82 percent among Democrats, 77 percent among independents, and 46 percent among Republicans.
• Between May 22, and May 26, 2018, MassInc Polling Group conducted a survey of 501 registered voters for WBUR. The survey found 77 percent of respondents in support of the initiative, 18 percent opposed, and 5 percent undecided.

Massachusetts Income Tax for Education and Transportation Initiative (2018)
Poll	Support	Oppose	Undecided	Margin of error	Sample size
MassINC Polling Group/WBUR 5/22/2018 - 5/26/2018	77.0%	18.0%	5.0%	+/-4.4	501
MassINC Polling Group/WBUR 11/9/2017 - 11/12/2017	76.0%	19.0%	5.0%	+/-4.4	503
MassINC Polling Group/WBUR 6/19/2017 - 6/22/2017	81.0%	15.0%	4.0%	+/-4.4	504
MassINC Polling Group/WBUR 1/15/2017 - 1/17/2017	77.0%	17.0%	6.0%	+/-4.4	508
AVERAGES	77.75%	17.25%	5%	+/-4.4	504
Note: The polls above may not reflect all polls that have been conducted in this race. Those displayed are a random sampling chosen by Ballotpedia staff. If you would like to nominate another poll for inclusion in the table, send an email to editor@ballotpedia.org.

Background

History of income tax in Massachusetts

Going into the election, the Massachusetts Constitution specified that all income must be taxed uniformly by the state. Massachusetts was one of eight states implementing a flat income tax rate. Personal income tax made up 61.4 percent of total taxes collected by the state in 2016.

In 2000, voters approved Question 4, the Massachusetts Income Tax Rate Reduction Initiative, to reduce the state income tax rate from 5.85 percent to 5 percent, beginning with a reduction to 5.6 percent in 2001 and to 5.3 percent in 2002. The state legislature passed a law in 2002 to reduce the rate by 0.05 percent per year thereafter only if economic triggers were met. As a result, the income tax rate in 2017 was 5.1 percent. The following table shows the rate each year from 1977 to 2017.

Income tax on the ballot in Massachusetts

Massachusetts voters have decided 11 ballot measures related to income tax before 2018; four were referred to the ballot by the state legislature and the other seven were citizen initiatives. Nine measures were defeated, and two were approved. Three measures were designed to reduce the income tax rate; two of the rate reduction measures were the ones that were approved. Two initiatives were designed to eliminate the state's income tax; they were both defeated. Six measures were designed to create a graduated tax rate instead of a flat rate; they were all defeated. The most recent measure would have eliminated the state's income tax and was defeated by voters in 2008.

Measure	Purpose	Type	Outcome
Question 1 (2008)	Eliminate	Initiative	d
Question 1 (2002)	Eliminate	Initiative	d
Question 4 (2000)	Reduced rate	Initiative	a
Question 3 (1998)	Reduced rate	Initiative	a
Question 7 (1994)	Graduated rate	Initiative	d
Question 6 (1994)	Graduated rate	Initiative	d
Question 3 (1990)	Reduced rate	Initiative	d
Question 2 (1976)	Graduated rate	Referral	d
Question 6 (1972)	Graduated rate	Referral	d
Question 2 (1968)	Graduated rate	Referral	d
Question 1 (1962)	Graduated rate	Referral	d

Income tax in the other states

As of 2017, 43 states taxed personal income—41 taxed wages while New Hampshire and Tennessee taxed only dividend and interest revenue. The remaining seven states did not tax personal income. Of the 43 states with an income tax, eight states—including Massachusetts—had a flat rate, and the other states had graduated rates that varied depending on different income brackets. The number of income tax brackets ranged from two (like the system proposed by this initiative) in Kansas to 10 in Missouri in California. The tax rate applying to income within the highest bracket across the 43 states with income taxes ranged from 2.9 percent applied to income above $416,700 in North Dakota to 2.9 percent to 13.3 percent applied to income above $1,000,000 in California’s. Compared to 2017 rates, this initiative would make Massachusetts the state with the fourth-highest income tax rate for income in the states' highest tax brackets.

As of 2017, three states had a higher income tax rate that applied to income above $1,000,000:

• California applied its highest income tax rate of 13.3 percent to income over $1 million for single filers and $1.075 million for those married and filing jointly.
  • California's next tax rate was 12.3 percent for income above $537,498 if filing as single or above $1 million if filing jointly.
• Connecticut applied its highest tax rate of 6.99 percent to income above $500,000 if filing as single and above $1 million if filing jointly.
  • Connecticut's next lowest tax rate was 6.9 percent for income above $250,000 if filing as single and above $500,000 is filing jointly.
• New York applied its highest tax rate of 8.82 percent to income above $1,077,550 if filing as single and above $2,155,350 if filing jointly.
  • New York's next lowest tax rate was 6.85 percent for income above $215,400 if filing as single and above $323,200 if filing jointly.

Although New Jersey does not have a bracket exclusive to income above $1 million, it's highest tax rate of 8.97 percent applies to income above $500,000, whether filing as single or jointly. This bracket was a significant jump above the next lowest, which featured a rate of 6.37 percent for income above $75,000 if filing as single and above $150,000 if filing jointly. Washington D.C. also had a tax bracket for income above $1 million.

History of Raise Up Massachusetts

Raise Up Massachusetts led the campaigns in support of two initiatives in 2014. Voters approved the group's Question 4, which required employers to provide certain employees with paid sick time. The organization also submitted signatures for a minimum wage initiative, which was pulled before certification because the legislature approved a similar bill.

Reports and analyses

Note: The inclusion of a report, white page, or study concerning a ballot measure in this article does not indicate that Ballotpedia agrees with the conclusions of that study or that Ballotpedia necessarily considers the study to have a sound methodology, accurate conclusions, or a neutral basis. To read a full explanation of Ballotpedia's policy on the inclusion of reports and analyses, please click here.

Pioneer Institute

In February 2018, the Pioneer Institute released a white paper on the effect of this initiative in tandem with the Congress of the Tax Cuts and Jobs Act of 2017 (TCJA). The report concluded that the approval of this initiative could result in those with high incomes leaving the state and the avoidance of the state by small businesses and start-ups.

On its website, the Pioneer Institute describes its mission in the following way: "Pioneer Institute is an independent, non-partisan, privately funded research organization that seeks to improve the quality of life in Massachusetts through civic discourse and intellectually rigorous, data-driven public policy solutions based on free market principles, individual liberty and responsibility, and the ideal of effective, limited and accountable government."

A selection of excerpts from the report can be expanded here

“ Recent passage by Congress of the Tax Cuts and Jobs Act of 2017 (TCJA) has dramatically altered the economic landscape surrounding the Proposition 80 initiative petition that will appear on the Massachusetts ballot this fall by placing a cap on itemized deductions of state income and local property taxes at $10,000 in total. [...] As explained in this analysis, the effect of Proposition 80 and the TCJA’s newly instituted limitation on the deductibility of state income taxes would more than double the effective Massachusetts income tax rate for the average taxpayer with an adjusted gross income of $1 million or more. [...] The first part is that they would be required by Proposition 80 to pay an additional tax on the portion of their taxable income over $1 million. [The second part is that] high-income taxpayers would no longer be able to deduct state and local income taxes, including the additional Proposition 80 taxes, on federal tax returns. [...] Although the optics of Proposition 80 make it more palatable for voters to support the measure in theory, a closer look at historic trends in wealth migration should cause voters to reject the notion that they will not be impacted. Tax policy that targets the wealthy can risk galvanizing a damaging trend of migration from high-tax states to no-tax states. ”

The full study can be read here.

Massachusetts Taxpayers Foundation

On February 12, 2018, the Massachusetts Taxpayers Foundation released an analysis of this initiative and concluded that the approval of this initiative would result in the high-income residents changing their state of residency with regard to taxation, ultimately resulting in decreased tax revenue and damage to the state's economy.

On its website, the Massachusetts Taxpayers Foundation described its mission in the following way: "Our mission is to provide accurate, unbiased research with balanced, thoughtful recommendations that strengthen the state's finances and economy in order to foster the long-term well being of the Commonwealth."

The conclusions described by the report as its key findings can be expanded here

“ Massachusetts already has a migration problem. A net 475,000 people and $18.9 billion in AGI left the state from 1993 - 2016. This out-migration damages economic growth and state tax revenues. If net migration had been neutral since 1993, that is, if the $18.9 billion in AGI had remained in Massachusetts, the state would have collected nearly $1 billion more in income taxes in 2017 alone, and substantially more over the 20+ year period. If the surtax passes, Massachusetts would have one of the highest tax rates in the nation on income over $1 million. And that may understate the upcoming shockwave to high-earners. Since [state and local tax] SALT deductions are now capped at $10,000, the effective state income tax rate for individuals making more than $1 million would soar to 9 percent from 3 percent – a remarkable 300 percent escalation. Given the state’s persistent out-migration issues absent a massive tax hike, the state is rapidly entering uncharted territory with no ability to mitigate the damage for years. Given the high cost of living along with increased property and income tax costs resulting from the federal limitation on SALT deductions, onerous estate taxes, and a surge in the number of potential retirees, the imposition of the additional 4 percent income surtax will surely drive more Massachusetts taxpayers to change their state of tax residency. Some have argued that migration due to tax policy is a myth but the data are irrefutable – people routinely move from high-tax states to low tax states. This should come as no surprise given that state and federal governments repeatedly use tax policies to influence behavior. Whether it’s taxes on cigarettes, sugar, and carbon emissions to reduce consumption or tax incentives for investments in life sciences, “green” technologies, or filming movies, policy makers understand that if you want more of something, tax it less; if you want less of something, tax it more. Four states that enacted a surtax on income over $1 million – California, Connecticut, New Jersey, and New York – know this to be true, having lost a combined $17.1 billion in adjusted gross income (AGI) in 2016 alone. Following federal tax reform in December 2017, all four states are now re-thinking their income tax policies in order to prevent further out-migration by their highest-earners. Conversely, Florida, which saw its income tax base increase by $17.4 billion in 2016 as measured by AGI, is using the recent federal tax reforms to recruit wealthy individuals from high-tax states. As the president of New York City Partnership recently commented on the efforts of her Florida counterparts, “Yes they are actively poaching and yes change of residence is easy.” Given the demographic challenges we face – an older and slower growing population – it would certainly benefit the state if it put as much energy into retaining businesses, high-income earners, and college graduates as it does in recruiting new companies, new investors and new talent to fill the shoes of those who have left. The state’s competition for talent and wealth – two characteristics that help generate the tax revenues to pay for vital safety net services – would be far easier if residents decided it was in their best interest to make their future here. ”

The full study can be read here.

Path to the ballot

See also: Laws governing the initiative process in Massachusetts

In Massachusetts, supporters of an indirect initiated constitutional amendment are required to collect signatures equal to 3 percent of votes cast for governor in the most recent gubernatorial election, excluding blanks.

If an initiated amendment is certified, the proposal must be approved by at least 25 percent of legislators during two successive legislative sessions. There are 200 legislators altogether—40 in the Massachusetts State Senate and 160 in the Massachusetts House of Representatives—so a proposed amendment must earn 50 positive votes. The proposed amendment does not need to earn a 25 percent vote from both chambers, but, rather, from a joint session. This means, for example, that if 50 members of the state House voted in favor of an amendment, it would require no support from any state senator to qualify for the ballot.

Petition drive

In 2015, supporters of initiated amendments were required to submit 64,750 valid signatures by December 2, 2015, in order to get the measure certified to appear on the 2018 ballot. On December 2, 2015, the campaign Raise Up Massachusetts reported that over 157,000 were collected and submitted for review. The initiative was certified to appear before the state legislature during the 2016 legislative session.

Cost of signature collection:
Sponsors of the measure hired Jewish Alliance for Law & Social Action, Jobs with Justice, Neighbor to Neighbor Education Fund, and Progressive Massachusetts to collect signatures for the petition to qualify this measure for the ballot. A total of $115,473.24 was spent to collect the 64,750 valid signatures required to put this measure before voters, resulting in a total cost per required signature (CPRS) of $1.78.

The signature costs listed above include in-kind services for signatures gathering provided by 1199 SEIU MA and the Neighbor To Neighbor Massachusetts Action Fund.

2016 legislative session

The initiative was submitted to the Massachusetts General Court during the 2016 legislative session as House Bill 3933 (HB 3933). A joint meeting of the state Senate and state House was held on May 18, 2016, to address the initiative. The initiative was passed 135-57. The measure needed the support of at least 50 legislators. Senators voted 33-7 to pass the measure. Representatives voted 102-50 to pass the measure. As the initiative was passed in 2016, a vote was required during the next legislative session in 2017.

Massachusetts HB 3933 (2016) Joint Meeting Vote
Result		Votes	Percentage
a Yes		135	67.50%
d No		57	28.50%
d Abstain		8	4.00%

Partisan breakdown of Joint Meeting votes
Party Affiliation	Yes	No	Absent	Total
Democrat	134	19	7	160
Republican	1	38	1	40
Total	135	57	8	200

2017 legislative session

The initiative was submitted to the state legislature as Senate Bill 10 (SB 10). A joint meeting of the state Senate and state House was held on June 14, 2017, to address the initiative. The initiative was passed 134-55. Senators voted 29-7, with two members not voting, to pass the measure. At the time of the vote, two seats were vacant in the Senate. Representatives voted 105-48, with seven members not voting, to pass the measure. As the initiative received the vote of at least 50 legislators, the measure was certified for the ballot in 2018.

Massachusetts SB 10 (2017) Joint Meeting Vote
Result		Votes	Percentage
a Yes		134	67.68%
d No		55	27.78%
d Abstain		9	4.54%

Partisan breakdown of Joint Meeting votes
Party Affiliation	Yes	No	Absent	Total
Democrat	133	16	8	157
Republican	1	39	1	41
Total	134	55	9	198

Anderson v. Healey

  

Lawsuit overview
Issue: Constitutionality; whether the initiative violates Article 48 of the Massachusetts Constitution on three counts: (1) whether the initiative's subjects are related; (2) whether the initiative makes specific appropriations; and (3) whether the initiative takes control of the legislature's power to generate revenue.
Court: Massachusetts Supreme Judicial Court
Ruling: Ruled in favor of plaintiffs, measure removed and blocked from November 2018 ballot
Plaintiff(s): Christopher Anderson, Christopher Carlozzi, Richard Lord, Eileen Mcanneny, and Daniel O’Connell	Defendant(s): Attorney General Maura Healey and Secretary of State Bill Galvin
Plaintiff argument: The initiative should not appear on the ballot in 2018. The initiative contains unrelated subjects, makes specific appropriations, and takes control of the legislature's ability to generate revenue.	Defendant argument: The initiative was correctly certified for the ballot because provisions are mutually dependent and related.

  Source: Massachusetts Supreme Judicial Court

On October 3, 2017, officials of five business groups filed a legal complaint in the Massachusetts Supreme Judicial Court to invalidate the attorney general's certification of the initiative and enjoin the secretary of state from placing the initiative on the ballot in 2018. The plaintiffs in the case are the following individuals:

• Christopher Anderson, president of the Massachusetts High Technology Council
• Christopher Carlozzi, state director of the National Federation of Independent Business
• Richard Lord, president and CEO of Associated Industries of Massachusetts
• Eileen Mcanneny, president of the Massachusetts Taxpayers Foundation
• Daniel O’Connell, president and CEO of the Massachusetts Competitive Partnership

Plaintiffs contend that the initiative violates Article 48 of the Massachusetts Constitution. According to the plaintiffs, the initiative violates the amendment for three reasons:

(1) Article 48 requires initiatives to address related subjects, and the initiative contains three subjects: "whether to impose a graduated income tax, and whether to give preferential treatment in state spending to two unrelated subject matters—education and transportation."

(2) Article 48 prohibits initiatives from making specific appropriations, and the initiative requires that revenue be "spent 'only' on education and transportation."

(3) The state Supreme Judicial Court should interpret Article 48 as prohibiting initiatives from taking control of the legislature's power to generate revenue via an initiated constitutional amendment.

Steve Crawford, a spokesperson for Raise Up Massachusetts, responded to the litigation, saying, "We’re not surprised that they have filed this last-ditch legal effort to keep this off the ballot. But their arguments are inconsistent with the positions they’ve advanced for years — that the foundation of our economy is based on a sound transportation system and investments in education."

On June 18, 2018, the court ruled 5-2 that the petition should never have been certified by the Massachusetts Attorney General, Maura Healey (D). The Supreme Court found that the initiative violated the state constitution, which prohibits ballot measures from mixing subjects that are not "related or mutually dependent." One assenting opinion stated, "A voter who commuted to work on an unreliable subway line, but who did not have school-aged children and was unconcerned about public education, might want to prioritize spending for public transportation, without devoting additional resources to public education, but would be unable to vote for that single purpose." A dissenting opinion was written that argues, "The court's opinion unduly operates to "deprive the people of a 'meaningful way' to express their will." I cannot support an interpretation that results in such an intrusion by the judicial power into the legislative power without a clearer expression in art. 48 providing the judicial department with that authority."

"Grand bargain" compromise deal

On June 28, 2018, legislation was passed in the legislature and signed by the governor as part of a compromise with ballot initiative proponents of three measures: a $15 per hour minimum wage initiative and an initiative to establish a paid sick and family leave program funded by a payroll tax, both backed by Raise Up Massachusetts, and a Sales Tax Decrease and Tax-Free Weekend initiative backed by the Retailers Association of Massachusetts.

The three initiatives were approved by the legislature since the Democratic-controlled Massachusetts Legislature passed and Republican Governor Charlie Baker signed a compromise bill known as the "grand bargain." The bill, House Bill 4640 (HB 4640), was passed in the Massachusetts House of Representatives on June 20, 2018, in a vote of 126 to 25. It was passed in the Massachusetts State Senate in a vote of 30 to 8, with two vacancies in the chamber. Of the eight no votes in the Senate, six of them came from Democratic senators and two came from Republican senators. Of the seven Republican senators in the Massachusetts Senate, all voted yes except Donald Humason Jr. (R-Second Hampden and Hampshire district) and Ryan Fattman (R-Worcester and Norfolk district).

The bill allows workers to take 12 weeks of paid leave, raises the minimum wage to $15 by 2023, and gradually (over five years) phases out time-and-a-half pay for Sunday work. The bill also requires the state to hold an annual sales tax-free holiday in August, though it did not reduce the state sales tax, as was proposed in the Sales Tax Decrease and Tax-Free Weekend initiative by the Retailers Association of Massachusetts. Raise Up Massachusetts and the Retailers Association of Massachusetts had agreed not to submit signatures for their proposed initiatives since the bill had been signed.

Compromise negotiations

Massachusetts Governor Charlie Baker reported in early May 2018 that he was engaged in talks of compromise with initiative proponents and leaders of the Massachusetts Legislature to reach a "grand bargain" before the measures go to voters in November. Baker said, “I’ve said all along that my hope is that we end up finding a way to work with a number of the folks who have ballot questions pending to come up with what I would describe as sort of a grand bargain. I know there have been conversations going on with both the House and the Senate and with folks in our administration with proponents on a number of these different questions and those conversations have been pretty productive." Proponents of the three measures had been in negotiations with each other, lawmakers, and business leaders to reach a compromise. State officials wanted a compromise to be made in the state legislature because had the three separate measures gone to the voters and been approved, it would have had a profound effect on the Massachusetts economy: raising the minimum wage, establishing a paid family and medical leave program, decreasing the state sales tax, establishing a sales tax free weekend, and keeping time-and-a-half pay for Sunday work. Governor Charlie Baker said, "The product of this is a far better product for the commonwealth than each of these as stand-alone entities would have been for Massachusetts, which is why I'm signing it."

Raise Up Massachusetts had been in negotiations concerning the paid family leave initiative exclusively, negotiating with the Associated Industries of Massachusetts, the Greater Boston Chamber of Commerce, the Massachusetts Business Roundtable, and the Springfield Regional Chamber under the leadership of Rep. Paul Brodeur (D) and Sen. Jason Lewis (D). In a June 7, 2018, letter to Senate President Harriette Chandler (D) and House Speaker Robert DeLeo (D), Raise Up Massachusetts wrote, "we've reached agreement on most aspects of a paid leave program that we believe could pass the Legislature with the support of both our coalition and the business groups, and we are very close to resolving the remaining provisions."

At the request of legislative leadership and Governor Charlie Baker, Raise Up Massachusetts entered negotiations on the two other measures they were backing: the $15 minimum wage initiative and the Income Tax for Education and Transportation Initiative, (often referred to as the millionaire tax initiative, which was stricken from the ballot), and with the Retailers Association concerning the sales tax decrease initiative.

In negotiations between the Retailers Association of Massachusetts and Raise Up Massachusetts, the Retailers Association sought concessions from Raise Up including a sub-minimum wage for teenagers and repealing the law that requires time-and-a-half pay on Sundays. Raise Up wrote that "Policies such as a sub-minimum wage for teens or the elimination of Sunday time-and-a-half pay would hurt some of our most vulnerable workers and their families, and we cannot support or accept them." At that time, Raise Up said they already made some concessions to RAM in the interest of striking a deal, including an offer to increase the minimum wage over five years instead of four.

Raise Up wrote in a press release regarding the court decision that blocked the 4 percent tax on income above $1 million initiative that they remain "strongly committed to winning a $15 minimum wage and paid family and medical leave for all Massachusetts workers this year, in the Legislature or on the ballot.”

A compromise on the measures allowed them to be resolved in the legislature rather than going to voters in November.

State profile

Demographic data for Massachusetts
	Massachusetts	U.S.
Total population:	6,784,240	316,515,021
Land area (sq mi):	7,800	3,531,905
Race and ethnicity**
White:	79.6%	73.6%
Black/African American:	7.1%	12.6%
Asian:	6%	5.1%
Native American:	0.2%	0.8%
Pacific Islander:	0%	0.2%
Two or more:	2.9%	3%
Hispanic/Latino:	10.6%	17.1%
Education
High school graduation rate:	89.8%	86.7%
College graduation rate:	40.5%	29.8%
Income
Median household income:	$68,563	$53,889
Persons below poverty level:	13.1%	11.3%
Source: U.S. Census Bureau, "American Community Survey" (5-year estimates 2010-2015) Click here for more information on the 2020 census and here for more on its impact on the redistricting process in Massachusetts. **Note: Percentages for race and ethnicity may add up to more than 100 percent because respondents may report more than one race and the Hispanic/Latino ethnicity may be selected in conjunction with any race. Read more about race and ethnicity in the census here.

Presidential voting pattern

See also: Presidential voting trends in Massachusetts

Massachusetts voted for the Democratic candidate in all seven presidential elections between 2000 and 2024.

More Massachusetts coverage on Ballotpedia

• Elections in Massachusetts
• United States congressional delegations from Massachusetts
• Public policy in Massachusetts
• Endorsers in Massachusetts
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See also

2018 measures

• 2018 ballot measures
• Taxes on the ballot

Massachusetts

• Massachusetts ballot measures
• Massachusetts ballot measure laws

News and analysis

• Ballot measure lawsuits
• Ballot measure readability
• Ballot measure polls

External links

• Text of the Massachusetts Income Tax for Education and Transportation Initiative

Recent news

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Massachusetts Income Tax for Education and Transportation Initiative (2018) - Google News