Worcester leaders get behind meals, lodging tax proposal.

Byline: Lisa D. Welsh

WORCESTER - When the City Council meets on Feb. 27, District 5 City Councilor Frederick C. "Rick" Rushton says he will ask his colleagues to support the local meals and lodging tax option in Gov. Deval L. Patrick's municipal relief package proposal.

"I'm excited and fired up about this," Mr. Rushton said yesterday at a press conference in City Hall. He was joined by District 1 Councilor Joffrey A. Smith and Councilor-at-Large Kathleen M. Toomey.

"I also spoke to (Councilor-at-Large Michael C.) Perotto, (District 2 Councilor Philip P) Palmieri and (state Sen. Edward M.) Augustus, who said they support it, but were unable to attend," Mr. Rushton said. "This just came out yesterday."

"Worcester is the hub of metro-Worcester. Each day, our city of 180,000 becomes a city of 225,000, as people come to work, school, dine, entertain and use the city's hospitals." he said. "But it's Worcester's property owners who are shouldering the burden of the delivery of services. A new meal and lodging tax will shift the burden to everyone who uses the benefits of Worcester."

Mr. Rushton said he learned about the new plan during Lt. Gov. Timothy P. Murray's speech Thursday night at the Telegram & Gazette 2007 Visions Community Awards ceremony at Mechanics Hall. Mr. Patrick and Mr. Murray had revealed the proposal earlier Thursday in meetings with municipal officials and lawmakers from across the state.

The proposal would allow municipalities to raise meals and lodging taxes at the local level, piggyback on state employee health plans and pension management to save money, and would close a loophole, enabling cities and towns to begin collecting up to $140 million on telecommunications infrastructure that has been exempt from local taxes for decades.

It's been calculated that Worcester could generate up to $2 million from the meals and lodging taxes and more from closing the telecom loophole. Mr. Rushton identified three areas in which he would ask the Worcester City Council to appropriate the additional revenues: education, property tax and municipal services.

"Urban centers are the lifeblood, but we don't ask the 50,000 who come into the city to share in the responsibility," Mr. Rushton said. "Worcester has spent billions on downtown revitalization, and all of metro-Worcester will benefit from this expansion at the expense of its taxpayers. This is a fair deal that starts (flexing) our urban leadership muscles."

Ms. Toomey said she provided a resolution for Mr. Murray with some of the issues that are being discussed.

"Nobody knows the issues affecting municipalities like the lieutenant governor, and as the (former) mayor of the second largest city in the state, he understands the frustration and what means the most to us," Ms. Toomey said. "I support this because the municipalities are finally getting some assistance beyond state aid. We need to control some of our own destiny."

As a Worcester resident, owner of the Flying Rhino restaurant on Shrewsbury Street and the past-president of the Shrewsbury Street Merchants Association, Paul Barber said he is on both sides of the local meals tax debate.

"A 1 or 2 percent increase would be another disadvantage of being a business owner in Worcester," Mr. Barber said. "I'm trying to compete in a world that doesn't see borders, and if customers see it's cheaper to eat over there in Northboro, then they will go to Northboro. It doesn't go to the growth factor that I want.

"Why does it have to be meals tax and not sales tax, why not for every industry?" Mr. Barber said. "I don't pretend to be an expert, but let's keep the competitive field even for the business world. It's not fair to punish me because I decided to move to Worcester, not Shrewsbury.

"But I am also on the residents' side," he continued. "As a homeowner, I've seen my kids' schoolteachers get cut, the satellite program (at Doherty) go away. I hate to see all the budget cuts in the school system. It's a shame, and I feel like the state government has let us down."

Mr. Patrick's proposal is among campaign promises he made to ease cities and towns' property taxes.

"Every one is going to be paying a higher meals tax, so to call this property tax relief when it is just another tax increase ... who is he (Deval Patrick) kidding?" said Barbara Anderson, executive director of Citizens for Limited Taxation. "It's just more taxes, which he is also calling Freedom taxes, because the towns are free to raise more taxes.

"Every idea he gets, he thinks is a wonderful new idea, but he doesn't realize that this has been rejected over and over for 30 years," Ms. Anderson said. "I was on a local option task force in the seventies, and all of us came to the conclusion that you can't do this because there is competition between communities.

"People will choose to shop and live elsewhere. Visitors can choose to go to a hotel and eat elsewhere. But the senior citizens want to stay and meet with their friends; they aren't likely to go to the next town. They are likely to end up paying the tax, and yet he seems to think this is revenue relief for them."

Mr. Rushton, asked if he thought an increase in meals and lodging taxes would diminish the growth that Worcester is cultivating downtown, said, "With all that Worcester has to offer, people are not going to choose to get a burger in the next town because it costs 10 cents more here. Our great restaurants aren't afraid to compete against anyone."

ART: PHOTO

PHOTOG: T&G Staff/TOM RETTIG

CUTLINE: Frederick C. Rushton, District 5 city councilor, discusses local meal and lodging tax during a press conference yesterday at Worcester City Hall.