Waltham could lose $9.8 million in state aid if voters pass a ballot referendum ending the state income tax, according to a report released this week by the Massachusetts Taxpayers Foundation.
Waltham is budgeted to get $21.3 million in state aid this year, said City Auditor Dennis Quinn.
Mayor Jeannette McCarthy said the city's schools would suffer, and layoffs would be likely if Question 1 were approved by voters Nov. 4.
"The biggest impact would be on employees," she said. "Eighty percent of the city budget is fixed. That includes retirement, salaries and health care. Jobs would have to be cut."
The study also predicted Newton would see a potential drop in general aid from $8.4 million to $2.4 million.
Waltham receives $13.7 million in state aid, not counting money it gets for schools. The foundation's study estimates across-the-board cuts of 71 percent for state programs and municipalities - if the ballot proposal passes.
The group estimates that state education aid would from decrease from $1.6 billion to $460 million.
The report, titled "The Enormous Consequences of Question 1," said income tax accounts for 40 percent, or roughly $12.5 billion, of the state budget. The state is legally obligated to fund $12.5 billion on items such as Medicaid, education and debt service.
That leaves the remaining state programs and local aid on the hook for further cuts, the group said.
Michael Widmer, president of the foundation, said the study illustrated the devastating effects that Question 1 would have on state spending.
"There's no way we can cut the programs by 70 percent," he said. "But if we don't cut all programs by 70 percent, then what do we do? If we cut someone 50 percent then we cut someone else 90 percent. How would you determine that?"
Carla Howell, a supporter for Question 1, sent out a newsletter yesterdaymorning, calling the numbers used in the study "fraudulent."
"Widmer knowingly and falsely understates total state government income and spending as $31.808 billion," she wrote. "He conceals and covers up $15 billion in state government revenue and spending."
In its report, the foundation analyzed Howell's assertion that the average Massachusetts taxpayer would receive $3,700 annually if the income tax is repealed. It found that the average annual payment for those with incomes under $50,000 is less than $850. That accounts for 65 percent of the taxpayers.
Widmer said the state would have to figure out other ways - such as property taxes - to regain the lost revenue. He argued that that would hurt lower-income homeowners because their property taxes would be more costly than the current income tax.
"Income tax is the fairest tax because those with a higher income pay a higher proportion," he said. "This will create a greater burden on lower- and middle-income taxpayers, because when the dust settles, they will have voted for a tax increase for themselves."
