Proposition

The Effects of Proposition 2½

Elizabeth Simms

In 1980, Ronald Reagan campaigned for the presidency on the promise of reducing taxes, regulation, and government spending at the federal level, promising that such reductions would boost economic productivity and thus stimulate the economy. In that same year that Massachusetts voted for Reagan in his first presidential election, Bay Staters faced a choice on “Proposition 2 ½.” The proposal had three main provisions: 1) it limited the local property-tax rate to within 2½ percent of a property’s taxable value; 2) it also required towns and cities to reduce their property tax rates by 15 percent every year until it reached this level and restricted local governments from increasing their local tax rate by more than 2½ percent each year; and 3) it reduced required the motor vehicle excise tax to be reduced from $66 to $24 per $1,000 of value, cutting reducing another significant local revenue source. Proposition 2½ passed by a margin of eighteen points. This vote represented the popularity of the small-government policies advocated by Reagan. At the time of the vote, Massachusetts had some of the highest property taxes in the country, and Proposition 2 ½ promised to ameliorate that tax burden for property owners.  However, Proposition 2 1/2 also caused problems for municipalities when the cost of running services increased more than the property tax was allowed to increase every year. 

As a result, local governments struggled to provide some of the public services that had become commonplace across the Commonwealth. Public schools bore the brunt of the cuts, but libraries were also disproportionately affected by the loss of revenue, albeit not as much as public schools. The Wayland Free Public Library, like many libraries throughout the state, faced increased financial difficulties after the approval of the referendum. For the 1982 Fiscal Year, the town’s Finance Committee recommended that the library reduce its budget to $212,000, down from the $219,891 budget for the 1981 Fiscal Year. In addition, the materials budget was reduced from $42,000 to $35,359. These reductions amounted to a 10% reduction in funds after inflation. To cope with this decrease in available funds, the library had to cut costs somewhere. The Board of Trustees considered closing the Cochituate branch, reducing the libraries’ hours, charging fees, reducing the building repair budget, and reorganizing the library’s staff. For the 1983 Fiscal Year, the library faced a similar need to reduce the library’s budget. Included in the suggestions for reducing the budget was the closure of the Cochituate branch, although the Trustees acknowledged that doing so would not save much money. However, after an open Trustee meeting in which residents voiced their desire to keep the Cochituate Branch open, the Trustees decided against closing the branch. 

The WFPL continued to deal with the financial repercussions of Proposition 2½ in the years after 1983. In 1984, the Board of Trustees attempted to obtain an override of Proposition 2½ through a vote by the town’s residents, which would allow them to increase the library’s budget by 3% for the following year, but they could not persuade the town to grant the override. Similarly, in 1989, the library found the funds available in its material budget to be considerably low. This lack of funds affected the number and variety of books the library was able to buy, making it difficult to meet requirements for state aid. In addition, the library’s inability to obtain an override that year would play a small role in the Trustee’s decision to close the Cochituate branch that year instead of the following year. In 1985, however, Wayland voters agreed to the override, providing the library the funding it needed in order to serve the public. That same year, the WFPL received an additional $150,000 from the federal government through Title II of the Library Services and Construction Act, allowing the library to expand, which was sorely needed. 

Overall, it seems clear that these policies impacted the library’s ability to provide important services. However, the library has managed to weather the financial strains caused by Proposition 2½, remaining open to serve the community while other towns like Saugus and Hampden temporarily lost their libraries in the 2000s. 

Bibliography

Morgan, Edward P. “The Effects of Proposition 2½ in Massachusetts.” The Phi Delta Kappan, 64, no. 4 (Dec. 1982): 252-258.

“Hidden Consequences: Lessons From Massachusetts for States Considering a Property Tax Cap.”

Library Trustee Minutes (BOLT), 1973-2009. Unpublished. WFPL Archives. 

Troy, Gil. “The Age of Reagan.” AP US History Study Guide. The Gilder Lehrman Institute of American History. Accessed 8 March 2023. https://ap.gilderlehrman.org/history-by-era/essays/age-reagan

OpenStaxCollege. “The Reagan Revolution.” University of Hawaii Pressbooks. https://pressbooks-dev.oer.hawaii.edu/ushistory/chapter/the-reagan-revolution/