Author: By Maureen Dezell, Globe Staff Date: 06/06/2002 Page: D1 Section: LivingAccusing state lawmakers of bad faith and bad social policy, Museum of Fine Arts director Malcolm Rogers is trying to rally support among cultural and philanthropic leaders to derail the Legislature's efforts to repeal a voter-approved tax deduction for charitable giving.
But while many appear to agree with the MFA director, few have enlisted in his uphill battle on Beacon Hill.
Rogers has been the most vocal among leaders of not-for-profit organizations opposed to the House of Representatives' elimination last month of the charitable deduction, which was endorsed by 72 percent of state voters in the November 2000 election.
The House amended the charitable deduction law as part of a $1.06 billion tax hike package crafted to help alleviate the Commonwealth's $2 billion budget deficit. The Senate Ways and Means Committee yesterday essentially endorsed the House tax plan, eliminating the deduction on a "temporary basis."
Rogers called the move on Beacon Hill "a classic case in which a decision was put into the hands of people who said they would spend the money on nonprofits - and then taken away."
Because the charitable giving law took effect in January 2001, there are no data available on its effect so far.
"The only definitive information would be from the tax returns from 2001, and those are simply not far enough along" to analyze, said Cam Huff, senior research associate at the nonpartisan Massachusetts Taxpayers Foundation.
The Committee to Encourage Charitable Giving, an ad hoc coalition of arts, education, and social service organizations, brought the measure to the state ballot in part because Massachusetts at that time was one of only eight states with personal-income tax but no deduction for giving.
That distinction, supporters maintained, discouraged giving. For evidence they pointed out that the Commonwealth ranked fourth among states in wealth per capita but 50th in charity, according to the Catalogue for Philanthropy's Generosity Index.
Massachusetts has since risen to 48th in the Generosity Index, a change that reflects the economy of the late 1990s and "public awareness" brought about by the 2000 campaign, said George McCully, project director for the Massachusetts-based Catalogue.
Nonprofit leaders and some economists expected the change in the tax law to increase giving.
Federal taxation studies show "that people give more as a result of the deduction," said Martin Feldstein, former chairman of the Council of Economic Advisers and president of the National Bureau of Economic Research. "Statistical studies show that for every dollar they save in taxes, people give about a dollar and 20 cents more to charity."
"What the Legislature has done," said Mark Volpe, managing director of the Boston Symphony Orchestra, "is shortsighted and bad public policy."
Legislators who estimate that the change in tax law would funnel between $180 million and $200 million per year from taxpayers' pockets to state coffers say they have no choice.
Paul Casey (D-Winchester), chairman of the House Taxation Committee, said that eliminating the tax deduction during tough economic times "really only affects a certain segment of the population" - the wealthy, who tend to itemize their returns.
Paul Grogan, president and CEO of the Boston Foundation, disagrees. "This affects all not-for-profits in this state," said Grogan. He predicted that repealing the law would reduce the amount of private money donated to nonprofit organizations already suffering from state budget cuts.
The Boston Foundation, the BSO, and leaders of the 2000 charitable giving effort have expressed their opposition to the change to the Legislature.
But few expect their sentiments to sway policymakers' opinions any time soon.
Rogers said he has placed several unreturned phone calls to the office of Senate President Tom Birmingham, who supported the 2000 proposal, to discuss the repeal plan, which comes before the full Senate next week.
A spokeswoman for Birmingham acknowledged that Rogers might not have heard from him because "this is the busiest time of the year in the Legislature."