Column: In defense of the Pacheco Law

Salem News | By Marc R. Pacheco | Sunday, July 5, 2015

20140922_TPAHomepageGraphic91814In a recent column for The Salem News, Eileen McAnneny states that the Taxpayer Protection Act has “hindered the T’s fundamental ability to maintain and repair its assets. Over the past five years, the barriers created by the Pacheco Law have contributed to the T’s inability to spend $2.2 billion in available funds to keep the system operating.” These claims are patently false.

The Taxpayer Protection Act (or the Pacheco Law) was enacted to protect the commonwealth from the waste, fraud and abuse that routinely took place as a result of an unchecked privatization scheme implemented at the expense of taxpayers. The law was originally named “An Act Providing for the Delivery of State Services in a Fiscally Responsible Manner” — and by the way, that’s exactly what it does: It puts in place a transparent process so the taxpayer will actually know how their money is being spent, while the auditor, acting on their behalf, can determine whether or not the commonwealth will actually save at least one penny when it comes to outsourcing. Passed in response to the Weld administration’s use of a privatization scheme that was not fully transparent and ultimately rewarded relationships over fiscal responsibility in the issuing of contracts, the Taxpayer Protection Act stops the “Good Old Boys” from being back in business.

Without a public, transparent process, taxpayers will be kept in the dark about the cost and quality of services provided, and there would be no one to hold contractors accountable. If an agency wants to privatize a state service, the Taxpayer Protection Act requires them to follow a process that measures cost and quality, ensuring that taxpayers get the best deal. Without the law, taxpayers would have no way of properly vetting contracts and no way of knowing whether contracting out a service will save or cost them money until it’s too late. As the saying goes, those who cannot remember the past are condemned to repeat it.

The Taxpayer Protection Act has nothing to do with the MBTA’s woes. Gov. Baker is using the unfortunate circumstances of this winter’s mess on the rails as a reason to get rid of the law when, in reality, he has long opposed it ever since his early days of privatizing health and human services for the Weld administration.

Any allegations that say the law is costly or preventing legitimate contracts from being permitted is just not true. The facts are in: 80 percent of privatization proposals attempted under the law’s guidelines have been approved.

These falsehoods have been put forth by conservative think tanks and organizations like the Koch-funded Pioneer Institute and the Massachusetts Fiscal Alliance, urging the state to reopen the floodgates to unconstrained privatization. (Gov. Baker, it should be noted, was once the Pioneer Institute’s executive director.) Their donors are largely unknown, or else it might be easier for readers to see why these groups have come out so strongly in favor of unfettered privatization.

McAnneny is the president of the Massachusetts Taxpayers Foundation and a former lobbyist at Associated Industries of Massachusetts. Historically, I could always count on the Massachusetts Taxpayers Foundation for accurate information, but McAnneny’s claims here challenge that: The $2.2 billion in available MBTA funds she speaks of was, in actuality, authorization — not real, working capital. It was an administrative choice not to turn it into actual funds, and the current administration still has yet to do so. Why McAnneny draws a line between this figure and the Taxpayer Protection Act is a mystery.

There is no doubt that the transportation system needs to be fixed, and that’s why the Senate supported Gov. Baker’s proposal for an MBTA fiscal management and control board. But change will not come from the adoption of insider dealings. Without transparency and actual accounting of what potential private services will cost, taxpayers could be left with a bill they don’t deserve. The commonwealth needs a careful, transparent process when state contracts are put to bid.

If it is the intent of the governor to solve the MBTA/s problems while saving money, one would think he would want the Taxpayer Protection Act to stay in place.

Marc R. Pacheco is president pro tempore of the Massachusetts state senate.


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