The proposed law would limit local property taxes and state taxes and would provide for increased state aid for local educational purposes.

The act would limit local property taxes in the years 1981 through 1984 to the amount levied in the previous year increased by the percentage increase in personal income of the residents of the Commonwealth during the previous year. The local property tax limit could be exceeded to offset decreases in local aid to cover shortages for prior years and to pay court judgments. Pension and retirement allowances, payments to other governmental units, principal and interest on any indebtedness, unemployment compensation amounts required to be raised as a condition of a state or federal grant, and costs for special education programs would be excluded from the property tax limit.

These local limits would be reduced by any excess taxes actually collected over the tax limit for the preceding year. The limit would not apply to any municipality having a general tax rate of less than $35 per thousand of equalized valuation. The tax limit could be exceed by a two-thirds vote of the local appropriating body.

The cost of regional and independent vocational schools would be subject to the same limitations.

The proposed law would also limit state taxes imposed in the years 1981 through 1984 to an amount no greater than that imposed the previous year, increased by the percentage increase in the personal income of Massachusetts residents in the previous year. This state tax limit could be exceeed only to increase local aid or to assume other costs approved by a two-thirds vote of the state legislate. The amounts necessary to pay principal and interest on state indebtedness, pensions, retirement allowances, unemployment compensation, and court judgement, and money required to be raised as a condition of a federal grant would not be subject to the state tax limit. The total amount for local aid for any year which would be subject to legislative appropriation and could not be less than the total amount of aid for the preceding year increased by half the increase in collected state taxes during the preceding year. The state tax limit would be reduced by any excess taxes actually collected over the tax limit for the preceding year.

The proposed law would require, subject to legislative appropriation, a gradual increase in the percentage of local educational costs paid by the Commonwealth to a level of 50% in 1984. The proposal would also require, again subject to legislative appropriation, that school aid paid by the Commonwealth in the year between 1981 through 1984 must be at least 15% greater than that provided in 1980.