In Tuesday’s election, Lexingtonians will vote on four different ballot questions in addition to choosing candidates in several state-level races. All four ballot questions are statewide measures – but one of them is on the ballot in large part because of the yearslong groundwork of a Lexingtonian.
In a year with few competitive state elections, perhaps the ballot item that has sparked the most conversation in Lexington is Question 1. Called the Fair Share Amendment by proponents, the measure seeks to amend the Massachusetts Constitution by adding an additional 4% tax on income over $1 million. If passed, income over $1 million would be taxed at 9% rather than the 5% flat state income tax. The change would go into effect for tax years beginning on or after January 2023, and the income level would be adjusted annually, like other federal income tax brackets, to reflect cost-of-living increases. Though the exact figure generated annually would likely vary significantly from year to year, the estimated $1.2 billion this targeted tax hike could generate would be directed toward transportation and education “subject to appropriation” by the legislature.
Jay Kaufman, a Democrat who served as Lexington’s state representative for over 20 years, was one of the earliest champions of Question 1. “I’ve been with the project since before it was a project,” he said.
Tax reform was a priority for Kaufman from the beginning of his public service. “For the entire time that I was in the legislature starting in 1995, it was very clear to me that…our tax system [is] profoundly inequitable,” he said. “Because of the fact that we have a flat income tax, every time we try to raise more money to do important public services, we’re only adding to the burden of people at the lower end of the income chart.” In his view, this model is also “unsustainable, if you want to have decent public services.”
In 2008, Kaufman asked to become Chair of the Revenue Committee in order to tackle tax reform. He later helped establish and lead a Tax Fairness Commission in 2013. After the Commission completed its report, Kaufman wanted to pursue its recommendation to establish a graduated income tax, which a majority of other states levy – but five separate ballot measures attempting this in Massachusetts have failed over the past century, most recently when Kaufman first ran for office in 1994.
“Although a grad[uated income] tax is the right thing to do, we couldn’t succeed; it would fail yet again,” Kaufman said, citing a lack of trust in the legislature and wary voters’ view that “‘whatever tax brackets they come up with, they’re going to hurt me’…the campaign of opposition would nurture the ever-present cynicism about government.”
Instead, Kaufman collaborated with other legislators to develop an alternative that would still “address the serious need for more money and the desire to raise it in a way that was more equitable.” Legislators landed on the idea of a tax on income over $1 million, and after initially struggling to pass this measure legislatively, Kaufman collaborated with the Raise Up Coalition to secure enough signatures to get Question 1 before the legislature as an initiative petition, where it earned over 70% of votes in both joint sessions in 2019 and 2021.
“My fervent wish for this is that it pass comfortably, and that about 20 years from now, people come together and say, ‘why didn’t they do a grad[uated] tax? That was the real fix,’” Kaufman said. “Maybe the time will be right for it then.”
If Question 1 is approved, Kaufman hopes that this revenue will help alleviate Massachusetts’ “tremendous backlog of capital investments on both education and transportation” by flowing toward improving bridges, schools and other education and transportation infrastructure in poor condition. “We’ve been woefully behind the eight ball on those kinds of investments for probably 20 or 30 years,” Kaufman said. On the education front, beyond infrastructure, he also hopes to see funding allocated to establishing universal pre-K and equalizing student opportunities across school districts with disparate resources.
This summer, the state had a nearly $5 billion surplus, a sum so massive that it triggered an obscure tax law requiring taxpayer refunds totaling close to $3 billion, which the state began distributing this week. Kaufman views this surplus as a one-time windfall; while it might mitigate some short-term state needs, in his view, it cannot suffice to remedy the Commonwealth’s long-term need for additional sources of revenue to fund education and transportation.
In Lexington, Question 1 has the backing of the Lexington Education Association (and on the state level, many other teacher and labor unions support the proposition, while many business groups have expressed and funded opposition, as reported by the Boston Globe). The Lexington School Committee voted to endorse Question 1 at the request of the LEA in June, as previously reported. Some Lexington volunteers have also organized local events in collaboration with the state campaign for the measure.
But some community members have raised questions or expressed concerns about Question 1. The Lexington Republican Town Committee, for instance, opposes the measure.
“It is these one time events (sale of a house, business, etc.) that [are] driving much of the opposition to Q1,” LRTC members wrote in a joint statement. Many of its members would not currently be affected by Question 1, but would be personally affected once they sold their homes, they added.
According to the Massachusetts Budget & Policy Center, the overwhelming majority of home sales statewide will not lead to Question 1 tax payments. Just 2% of homes sold for a capital gain of more than $1 million last year, while less than 1% sold for a gain of $1.5 million, which is the gain that would have to be generated to trigger the proposed tax when taking into account the $500,000 tax exemption on capital gains for married couples.
But it’s certainly true that in Lexington, the percentage of residents generating capital gains of this scale from home sales is higher than in most communities across the Commonwealth. In 2021, 23% of home sales in Lexington resulted in a gain of $1 million or more, while 10% resulted in a gain of $1.5 million or more, per MassBudget.
Kaufman said he does not want Question 1 to undermine individuals’ nest eggs. He hopes that the legislature, or Department of Revenue, will take action to allow one-time profits such as sales of houses or farms to be spread out over multiple years to exempt these individuals from the new tax if it is approved, he said.
But even though he would support such exemptions, Kaufman added that “if I had more than a million dollars, I wouldn’t mind spending $40,000 of the next million to contribute to really important social services, including education and transportation.”
The LRTC also pointed out that the legislature would not be bound to spend this funding on education and transportation due to the amendment language subjecting these funds to appropriation. “They have demonstrated time and time again over the years they are an untrustworthy body, willing to contradict both the will of the people and their own prior promises,” the LRTC wrote.
Kaufman said that if legislators misuse the funds, taxpayers should hold them accountable by voting them out. “The old bromide is ‘vigilance is the eternal price of liberty,’ so…we’re going to need to be ongoingly vigilant,” he said.
Democratic gubernatorial candidate Maura Healey, the heavy favorite to win Tuesday’s election, has also pledged to veto any potential effort by the legislature to divert Question 1 funds away from their intended purpose of supporting education and transportation if she is elected and the constitutional amendment passes.
Kaufman also hopes that the Department of Revenue will create a “separate accounting mechanism” for revenue generated by the new tax to create complete transparency about where this funding comes from and how it’s spent. “Transparency is critical to deal with the distrust, and even just legitimate questions,” he said.
Notwithstanding Lexington’s relative affluence, Kaufman believes that there is substantial support for this kind of tax reform in Lexington. When Kaufman first campaigned for tax fairness in 1994, he “was very explicit about the fact that if I was elected and had my way, many of us, many of my constituents at that point, and many of us in Lexington would probably wind up paying more taxes,” he said. “That never really came back to haunt me politically…So I think there’s general support for fairness, for tax fairness, in this community.”
“Other than having a reliable T and safer roads and bridges, which would serve people in Lexington as well as every place else, I think the main benefit would be that we’d be living in a fairer Commonwealth,” Kaufman added. “And that should be worth something to all of us.”
Today is the last opportunity to vote early in person; this early voting session will be held at the Cary Memorial Building from 8:30 a.m. to 1 p.m. You can determine your polling place on Election Day here. On Nov. 8, polls will be open from 7 a.m. to 8 p.m. Don’t forget that ballots are two-sided.
Please monitor what percent of this money goes into the general fund. One study suggests 30 to 70 percent not “all” of the money for schools and roads as implied