CHARLESTON, W.Va. – A new report estimates nearly $200 billion a year in revenue is lost to offshore tax havens – enough to not only stop the automatic federal spending cuts threatened for March 1, but also cover all state and local firefighting budgets nationwide for 12 months.

Dan Smith wrote The Hidden Cost of Offshore Tax Havens for U.S. PIRG. He says the consumer advocacy group estimates the U.S. loses a $150 billion a year, and states lose another $40 billion – more than $100 million in West Virginia state taxes alone.

"It's not a victimless offense,” Smith says. “The winners are the big banks, pharmaceuticals and high tech companies. And the losers are small businesses and ordinary taxpayers."

Defenders say the havens help firms dodge a high corporate income tax rate. They say the companies might leave the country completely if the loopholes were closed.

Smith says the dirty secret is few companies pay the full corporate rate. And he says they're unlikely to leave, because the work is done here and the products are sold here.

He adds many corporate subsidiaries are little more than a complicated legal fiction. Products might be created and sold here, but the profits can magically bounce around the world before ending up in a Caribbean P.O. box.

"In the Cayman Islands there is actually a single building, five stories tall, that has nearly 19,000 corporate headquarters registered to it," Smith says.

According to Sean O'Leary, a policy analyst with the West Virginia Center On Budget and Policy, the state has closed one big loophole that had allowed companies to hide profits in other states. But he says it's hard to confirm how much the state loses to offshore tax havens, because companies don't even report the figures.

"If it's $10 million, if it's a $100 million, it's depriving the state of resources,” he says. “Could we be closing these loopholes to fix our budget problems, or should we be cutting things like higher education?"

O'Leary says the system gives the biggest companies an unfair advantage and Smith agrees.

"The small business owner doesn't have a thousand lawyers in its tax department,” Smith says. “That's how many General Electric has. And not surprisingly, that company over a three-year period paid nothing in federal income taxes."





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Yesterday was the first anniversary of the signing of the federal infrastructure law.

Groups pushing for support for Wisconsin towns and cities say implementation is providing hope overlooked areas will get the jolts they need.

Zach Vruwink, deputy executive director of the League of Wisconsin Municipalities, said so far, nearly $3 billion in projects for the state have been announced with funding from the law. Most are transportation-related, and Vruwink argued it is badly needed, as many areas have backlogs for priorities like road and bridge repairs.

"Many of the municipalities have had projects delayed, or had to shelve them, due to lack of funding," Vruwink pointed out. "By having a real strong federal partnership in the area of infrastructure helps address some of the backlog."

The law will also provide states funding for clean water infrastructure and expansion of high-speed internet. Funding from the $1.2 trillion package was scheduled to be spread out over five years. The plan had some Republican opposition, but has otherwise been hailed by political analysts as a bipartisan achievement.

Despite the significance of the law, some analysts said it has not stayed on the public's radar, especially during the recent election, but supporters are still getting the word out.

Meghan Roh, program director for Opportunity Wisconsin, which has spent the last year educating communities about the benefits of these projects, said people need to understand the effect of such a significant investment.

"Whether we're spending less on car repairs due to updated roads and bridges, having access to safe drinking water or improved mass transit opportunities, this law is a once-in-a-generation investment in our state's infrastructure and competitiveness," Roh stressed.

And as more projects are announced, Roh noted it means additional, well-paid union jobs for distressed areas. She added the long-term benefits from various improvements should particularly help rural areas and underserved communities.

An interactive online map from the White House shows the projects so far are spread fairly evenly across Wisconsin.

Educators across the Commonwealth say voters showed their commitment to public education in the midterm election by passing the Fair Share Amendment.

It creates a 4% tax on annual incomes above $1 million to help pay for public education and transportation.

It's expected to generate at least $2 billion in revenue for schools, universities and vocational training, as well as the roads and trains to help get the students there.

Joanna Gonsalves - associate professor at Salem State University and member of the Massachusetts State College Association - said the new funding is no 'magic bullet,' but a start to addressing system failures in the state.

"I think we need to start to address some of the crumbling infrastructure in our public campuses and the buildings, in our roads and in MBTA," said Gonsalves. "And that's going to require some additional funding, beyond Fair Share."

Many business groups opposed the Fair Share Amendment, warning it would make the Commonwealth less economically competitive and drive away employers. They also question the need for more revenue when the state is already running a large budget surplus.

The decision about where the new tax revenue is spent ultimately rests with state lawmakers, and even future lawmakers are under no obligation to spend the money as requested.

Still, Gonsalves said lawmakers would be wise to respond to the public's concerns about the cost of higher education in Massachusetts and the wellbeing of its students.

"We need to address the most basic things, like class size," said Gonsalves. "We want to make sure we have enough staff and services for our students."

That includes the great need for increased mental-health services as schools continue to recover from the impact of the pandemic. And Massachusetts faces a critical shortage of school counselors, with one counselor for every 364 students.

New York voters approved the state borrowing $4.2 billion for robust climate-friendly projects.

The Clean Water, Clean Air, and Green Jobs Environmental Bond Act will provide funds for school districts to get electric school buses and develop the infrastructure to charge them, make state-owned buildings green, and preserve farmland, just a sample of the projects the new funding will support.

Anne Reynolds, executive director of the Alliance for Clean Energy New York, said the law is a culmination of a multiyear effort, but as much as it accomplishes, she argued incentives for electric vehicles are needed.

"There's not money specifically in here for incentives to have New Yorkers buy electric cars, and I think that's going to be something that we need," Reynolds contended. "The plan is to phase out internal-combustion engine vehicles over time, but in order to get people to get started on that, they're going to have some incentives to have people buy electric cars."

The bond act was met with little opposition in the state Legislature and in the voting booth. According to unofficial data from the State Board of Elections, 59% of voters approved it. 28% voted against it and 12% left the option blank.

Although climate change was not a top issue for New Yorkers, it has been a necessity for the state. Reynolds pointed out there has been a need to update water infrastructure, among other improvements. She noted the money is not just for large statewide projects, but at the local level.

"A lot of the money will be helping communities, like municipalities," Reynolds explained. "For example, $150 million for farmland preservation, and some communities might have a farmland preservation plan; they might have a town goal to maintain farmland. But, this is the money that's going to help them do it."

Reynolds does not see another ballot measure like this one coming about in the near future, but if it should, she would want to see money allocated for upgrading New York's electric grid to make it more climate friendly.