Towns Cry Foul on Healey Tax Delinquency Measure

Leaders of cash-strapped municipalities are urging lawmakers to ditch a budget proposal from Gov. Maura Healey that would overhaul how delinquent motor vehicle taxes are collected, and potentially risk a key revenue stream for cities and towns.

With the House poised to unveiling its fiscal 2027 budget, local officials, like Franklin Town Manager Jamie Hellen, have been rebelling against what they view as an ill-conceived “reform” to a system that currently works well.

Watertown City Councilor Lisa Feltner used a Beacon Hill meeting with Lt. Gov. Kim Driscoll to oppose technical aspects of the Healey administration’s plan to stop imposing non-renewals of driver’s license and motor vehicle registrations over certain unpaid debts.

In Healey’s budget (H 2), an outside section would direct the Department of Revenue to help the Office of the Comptroller collect unpaid motor vehicle excise taxes, parking tickets and abandoned vehicle fines. Feltner said the proposal could be a “dramatic change” to the existing non-renewal program run through the Registry of Motor Vehicles, which allows participating municipalities to tag registration records that have delinquent payments.

“The current system works. It’s also simple to enforce, well-established and successful,” Feltner said at a Local Government Advisory Commission meeting Tuesday, adding the RMV system creates a “powerful incentive” for people to pay their fees so as to not lose driving privileges.

“While we appreciate the good intention behind this new proposal, it would replace a proven tool with a more uncertain and cumbersome process,” Feltner continued. “It would potentially jeopardize critical municipal resources and add unnecessary strain on local finances and staff.”

The Massachusetts Municipal Association said, under Healey’s proposal, delinquent payments would be sought through the state’s Intercept Program, which allows the state to deduct from things like individual state tax refunds and lottery winnings over $600.

“Not everybody receives an income tax return, and we think (that) would put in jeopardy hundreds of millions of dollars of local revenue,” MMA Executive Director Adam Chapdelaine told the News Service.

He added: “We’ve put the full-court press on making it clear to both the House and the Senate, as they consider their budget, just how opposed we are to this proposal.”

Asked if lawmakers have been sympathetic to the the trade association’s appeal, MMA Legislator Director Dave Koffman said, “There’s definitely been, I think, a sympathetic understanding that this may be the absolute worst time to make a risky proposal like this.”

Hellen said in Franklin, the town finance staff spearheaded a letter in opposition to the Governor’s proposal. “We are grateful that Repressntative Jeff Roy and the House agreed with our position.

Should the proposal become law, Healey’s office estimates that more than 500,000 driver’s license non-renewals would be lifted within three months. Withholding driver’s licenses over unpaid debts can affect people’s access to employment, health care and other “essential needs,” the office said.

“This proposal will remove onerous penalties for debts that do not negatively impact public safety or other individuals, making the system fairer and bringing us in line with other states,” Healey said.