Comptroller Fiscal Year Memo Letter Head

November 17, 2010

Secretary Jay Gonzalez
Executive Office for Administration and Finance
State House, Room 373
Boston, MA  02133

Secretary Jeffery Mullan
Massachusetts Department of Transportation
10 Park Plaza, Room 3170
Boston, Massachusetts, 02116

RE:  November 15, 2010 Certification of MBTA Dedicated Sales Tax Revenues for the Fiscal Year Ended June 30, 2011 – Recertified Fiscal 2011 Base Revenue Amount

Dear Secretary Gonzalez and Secretary Mullan:

Pursuant to Massachusetts General Laws (MGL) Chapter 10, Section 35T, paragraph b, I certify, after consultation with the Commissioner of Revenue, that the projected dedicated sales tax revenue amount for fiscal 2011 is projected to be $653,299,000.

The projected dedicated sales tax revenue amount is the amount of “monies received by the Commonwealth equal to one percent of the gross receipts of a sale as defined by the provisions of MGL chapter 64H and one percent of the sales price of a purchase as defined by the provisions of chapter 64I from that portion of the taxes imposed under the provisions of said chapters 64H and 64I as excises upon the sale and use at retail of tangible property or of services, and upon the storage, use or other consumption of  tangible property or of services, including interest thereon or penalties but not including any portion of such taxes imposed on the sale of meals as defined in paragraph (h) of section 6 of chapter 64H  The calculation of sales and meals taxes dedicated for the MBTA is  net of refunds, abatements, and amounts set aside under paragraph (b) of section 10 of chapter 152 of the acts of 1997 (the “Convention Center Portion”).

The projected dedicated sales tax amount was calculated as follows:

 

Fiscal Year 2011 March 1, 2010/May 10, 2010  Certification

Fiscal Year 2011 November 15, 2010 Certification

Change

 

 

 

 

Projected Sales and Use Tax Collections, Exclusive of Meals Tax

$4,027,180,000

$4,083,119,000

$55,939,000

 

 

 

 

Percentage due to the MBTA

´ 16.0% (*)

´ 16.0% (*)

 

 

 

 

 

Projected Dedicated Sales Tax Revenue for FY 2011 (rounded down)

$644,349,000 

$653,299,000 

$8,950,000 

 

 

 

 

Base Revenue as Recertified on May 10, 2010

$767,056,684**

$767,056,684

$0 

(*) As of August 1, 2009 the sales tax rate was increased from 5% to 6.25% for both regular sales and motor vehicle sales. Based on this new sales tax rate, the MBTA dedication percentage is now 16.00% (1 cent of 6.25 cents per dollar) as compared to the prior dedication percentage of 20% (1 cent of 5 cents per dollar).

(**)Pursuant to Massachusetts General Laws Chapter 10, Section 35T, as amended by Section 3 of Chapter 86 of the Acts of 2010, the FY2011 base revenue amount was recertified by the State Comptroller on May 10, 2010, which resulted in an increase in the FY2011 base revenue amount from $761,840,699 to $767,056,684.

 Any shortfall between dedicated sales tax revenue and the base revenue recertified on May 10, 2010 will be made up by quarterly transfers from the General and Highway Funds, pursuant to the MOU and Chapter 10, Section 35T(b).  Should you have any questions on the calculation of this amount, please feel free to call me.

Sincerely yours,

Martin J. Benison
Comptroller

Cc:          

Senator Stephen C. Panagiotakos, Chairman Senate Ways and Means                
Representative Charles A. Murphy, Chairman House Ways and Means                
Timothy Cahill, Treasurer and Receiver – General, TRE                
Navjeet Bal, Commissioner of Revenue                
Matthew Gorzkowicz, Undersecretary, ANF                
Douglas Howgate, Senate Ways and Means Budget Director                
Jeita Phillips, House Ways and Means Budget Director