October 30, 2017

Understand ballot initiatives' impact

Massachusetts' law allowing voters to have a direct say in creating and passing laws through ballot initiatives turns 100 years old next year, and the state once again looks to have several interesting initiatives up for public vote.

The first-ever law passed by ballot initiative came in 1920, when voters labeled beer as a non-intoxicating drink and therefore exempt from Prohibition (Best ballot-initiative law ever!). Since that time, the ballot has been used to allow Sunday sporting events, legalize contraceptives and create a recreational marijuana industry. While it would be easy to paint ballot initiatives as some sort of mob rule, the complex process required to get a measure on the ballot, and the Legislature's ability to re-shape the legislation after the fact – without altering its original intent – means the will of the people can become the law.

One of the challenges with ballot initiatives is the public tends to view them as individual measures. Seasoned legislators and others leaders who make it their business to see the forest through the trees understand how one law might impact several others, and how a collection of laws sends a message about the state's priorities. In 2018, it seems very likely that we'll have a handful of ballot measures which may sound fair on their own, but collectively would be very unfriendly to businesses.

The first is the proposal to increase the state's minimum wage to $15 per hour. We're on the record in support of this move for Massachusetts given our high cost of living, but the state will need to develop a plan to phase in an jump of this magnitude (a 36-percent increase). The last time the Legislature dealt with a significant increase of this magnitude was when it increased minimum wage over three years from $8 to $11, which remains the highest minimum wage in the nation.

The second ballot measure would require 16 weeks of paid family leave and 26 weeks of paid medical leave for employees. While it's a good idea for companies to offer their workers robust benefits and encourage employees to have a healthy work-life balance, paid leave should not become a one-size-fits-all law. The current Massachusetts law calls for eight weeks of unpaid leave, if the employee is not covered under the Family Medical Leave Act, which gives works 12 weeks of unpaid leave.

The third ballot measure would impose a 4-percent surtax on all incomes of more than $1 million per year, including those for businesses. On its face the proposal simply makes the highest earners pay a higher tax rate, but it also serves to make a big jump in the business income tax in Massachusetts. Some 25 years ago Massachusetts earned its unfortunate "Taxachusetts" moniker and was not considered business friendly. Fast forward to today, and the state has not only shed that old reputation, but has a diverse, vibrant economy putting it in the driver's seat in attracting growing industries. Tax law changes are better left to experienced lawmakers who can understand what the complex web of taxes says about the state.

There are 21 proposed ballot measures approved by Attorney General Maura Healey for eligibility. Each of them are still required to meet several other deadlines before actually appearing on the ballot. Will these three measure make it all the way onto the final statewide ballot? That remains to be seen. If they do, and all three pass, then it will be up to the legislature to mitigate the big potential downside of having all three of them become law. Taken one at a time, each may have its merits, but passed as a group they would send a very negative signal to the drivers behind the state's robust economy.


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