Zither me.

6/24/08

What is a zither? Good question and until a month ago, I had never heard of one – much less had seen one. It is a stringed instrument consisting of a wooden frame across which are stretched several (about thirty) strings. Five of these strings are used for the melody, they are above a fretted fingerboard. The rest of the strings are used for harmony and are not fretted.He is what a zither looks like:

Zither

And why would should we care about the zither? Well, it seems that George Washington was an avid zither enthusiast, as we jump forward fifty years and celebrate the arrival in this country of the already more developed zither that came to the New World with the large waves of immigration from German-speaking lands. The next question is: Could a land scam have given America its first and greatest zither builder? The answer is a resounding “Yes”. Franz Schwarzer immigrated to Missouri from Austria in 1864, expecting to become a gentleman farmer on the Missouri River near the little town of Holstein. Unfortunately at the time but fortunately for the future, he and his wife were the victims of a land scam, and their promised farm and house turned out to be a piece of raw land and a shack. They soon moved across the river to Washington, Missouri, and Franz went back to his former trade of carpentry. He had had some contact with the zither and leading zither figures in Austria, and somewhere around 1866 he tried his hand at making a zither. This instrument is carefully preserved in the state museum at Jefferson City, and I have held it in my hands.

The first instrument quickly led to others, ever better in quality. In 1873 he won the gold medal at the International Exhibition in Vienna. By this time zither building had become his trade, and he had built a small factory and employed several craftsmen to meet the growing demand from this country and abroad. He developed several different models, most of them featuring the delicate mother-of-pearl inlay that was one of his trademarks.

As he flourished, so did zither playing in the United States. Without the distractions we have today, people made music at home, for their own pleasure and satisfaction and that of the people around them. From the 1870s into the 1920s, zither teachers taught and students learned. Zither clubs abounded. Never mind that the zither is the most difficult of all instruments to play; they had more patience and perseverance in those days, finding joy in the beauty of the instrument and satisfaction in gradually learning to draw beautiful sounds from it. The few American players of today look back on those times with incredulous envy.

Just for kicks, I did a search on the web to see what they have sold for on ebay. Looks like one of our very own bought they one I found:

Winning bid: US $510.00
Ended: Jan-15-06 18:57:48 PST
Shipping costs:
US $33.71
US Postal Service Parcel Post®
Service to 63090, United States
Item location: Westchester, United States
History: 17 bids
Winning bidder: slpawngun

More related information:

Visiting the Homeland of Schwarzer Zithers @ http://www.zither.us/?q=node/23

Zither MP3 Downloads: http://mp3search.01-mp3search.com/top53-zither.html

Zither youtube: http://www.youtube.com/watch?v=W4fuBqLfgns&feature=related

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Published in: on June 24, 2008 at 10:08 pm  Comments (2)  

• Red Light Cameras Fail to Reduce Accidents

D.C. Red-Light Cameras Fail to Reduce Accidents
By Del Quentin Wilber and Derek Willis
Washington Post Staff Writers
Tuesday, October 4, 2005; Page A01

The District’s red-light cameras have generated more than 500,000 violations and $32 million in fines over the past six years. City officials credit them with making busy roads safer.

But a Washington Post analysis of crash statistics shows that the number of accidents has gone up at intersections with the cameras. The increase is the same or worse than at traffic signals without the devices.

D.C. Police Chief Charles H. Ramsey said citations for red-light running have dropped by about 60 percent at intersections that have the cameras.

D.C. Police Chief Charles H. Ramsey said citations for red-light running have dropped by about 60 percent at intersections that have the cameras.

Monitored Intersections
The D.C. government installed the first of its red-light cameras in 1999. By the following year, 37 intersections were covered in the city, some with more than one camera. The number of traffic accidents at the 37 intersections has gone up since the cameras were installed. The increase is the same or worse than at the 1,520 intersections with traffic lights that do not have red-light cameras.

Three outside traffic specialists independently reviewed the data and said they were surprised by the results. Their conclusion: The cameras do not appear to be making any difference in preventing injuries or collisions.

“The data are very clear,” said Dick Raub, a traffic consultant and a former senior researcher at Northwestern University’s Center for Public Safety. “They are not performing any better than intersections without cameras.”

The District started the camera program in 1999, and from the beginning, officials said they were aiming to curtail red-light running and accidents. At the time, Terrance W. Gainer, then the second-highest ranking D.C. police official, said the cameras would “get people to stop at red lights and avoid crashes. . . . Hopefully, we’ll have a few less messes to clean up.”

D.C. Police Chief Charles H. Ramsey said he remains convinced that the devices are worthwhile. Even if the number of crashes is not going down, he said, citations for red-light running have dropped by about 60 percent at intersections that have cameras.

Ramsey said the number of accidents would be even higher without the cameras, adding that he would like to install them at every traffic light in the city. He pointed to last year’s steep decrease in traffic fatalities — 45 people died compared with 69 in 2003 — as evidence that the program is working.

“I’d rather have them than not have them,” Ramsey said. “They make people slow down. They reduce the number of traffic violations, and that’s a good thing.”

City officials attribute the increase in accidents to higher traffic volume. But that does not explain why the presence of cameras has failed to slow the rate of accidents at those intersections, Raub and others said. The outside experts suggested that the cameras might be more useful at other locations, and D.C. officials said they are studying the issue.

The city has cameras at 45 intersections. They take photographs of cars running red lights, generating tickets that are processed by a private contractor. Police oversee the issuance of tickets, which carry $75 fines, and the money goes into the city’s general fund — nearly $5 million last year.

The Post obtained a D.C. database generated from accident reports filed by police. The data covered the entire city, including the 37 intersections where cameras were installed in 1999 and 2000.

The analysis shows that the number of crashes at locations with cameras more than doubled, from 365 collisions in 1998 to 755 last year. Injury and fatal crashes climbed 81 percent, from 144 such wrecks to 262. Broadside crashes, also known as right-angle or T-bone collisions, rose 30 percent, from 81 to 106 during that time frame. Traffic specialists say broadside collisions are especially dangerous because the sides are the most vulnerable areas of cars.

The number of crashes and injury collisions at intersections with cameras rose steadily through 2001, then dipped through 2003 before spiking again last year.

The results were similar or worse than figures at intersections that have traffic signals but no cameras. The number of overall crashes at those 1,520 locations increased 64 percent; injury and fatal crashes rose 54 percent; and broadside collisions rose 17 percent.

D.C. Police Chief Charles H. Ramsey said citations for red-light running have dropped by about 60 percent at intersections that have the cameras.

Monitored Intersections
The D.C. government installed the first of its red-light cameras in 1999. By the following year, 37 intersections were covered in the city, some with more than one camera. The number of traffic accidents at the 37 intersections has gone up since the cameras were installed. The increase is the same or worse than at the 1,520 intersections with traffic lights that do not have red-light cameras.
reader forum

Overall, total crashes in the city rose 61 percent, from 11,333 in 1998 to 18,250 last year.

Lon Anderson, a spokesman for AAA Mid-Atlantic, said the data reinforce the motor club’s view that the red-light effort is targeted more at generating revenue than at reducing crashes. “They are making a heck of a lot of money, and they are picking the motorists’ pockets on the pretense of safety,” he said.

Red-light cameras are used in 12 states, including Maryland, where they are deployed in Montgomery and Prince George’s counties. In Virginia, the General Assembly eliminated red-light cameras this year partly because of concerns raised by some legislators about civil liberties. The action affected six Northern Virginia jurisdictions: Alexandria, Arlington County, Fairfax City, Fairfax County, Falls Church and Vienna.

The District installed its first batch of 26 cameras in 1999. City officials added 14 the next year. Some intersections have more than one camera to cover different approaches. All told, the cameras installed in 1999 and 2000 covered 38 intersections; a camera subsequently was removed from one of them.

Ramsey said city officials put the cameras where police noticed the most red-light running. At the start of the program, police officials said they also received advice on camera placement from residents and from the private contractor that operated the devices.

Nine more cameras were installed in July, boosting the number of monitored intersections to 45. Most of those drivers ticketed come from outside the city. In August, for example, less than one-fourth of the citations were issued to motorists from the District.

D.C. police also operate photo-radar devices that take pictures of speeding motorists. Because many of these cameras are mobile and used at varying times, they were not included in The Post’s review.

Douglas Noble, the chief traffic engineer for the D.C. Department of Transportation, said his office was examining crash data and plans to review the red-light camera locations. The department collects the data from police reports and advises police about where to install the devices.

Noble said that no studies have been conducted on the District’s red-light cameras in several years but that he “would not disagree” with The Post’s analysis. “I don’t necessarily have an explanation” for the trends, he said.

He added that he believes the severity of injury crashes has decreased at camera locations. The city crash database does not categorize the severity of crashes.

D.C. Red-Light Cameras Fail to Reduce Accidents

AAA and other critics have accused the city of installing cameras in high-volume locations where they could generate thousands of tickets, regardless of how many accidents happened there.

The analysis raised questions about where police installed the cameras. Nine intersections with cameras had two or fewer crashes annually in 1998 and 1999; seven reported no crashes that led to injuries or fatalities during that period. Officials installed cameras at six of the 20 most crash-prone intersections in 1998, data show.

D.C. Police Chief Charles H. Ramsey said citations for red-light running have dropped by about 60 percent at intersections that have the cameras.
D.C. Police Chief Charles H. Ramsey said citations for red-light running have dropped by about 60 percent at intersections that have the cameras. (By Gerald Martineau — The Washington Post)
Graphic
Monitored Intersections
The D.C. government installed the first of its red-light cameras in 1999. By the following year, 37 intersections were covered in the city, some with more than one camera. The number of traffic accidents at the 37 intersections has gone up since the cameras were installed. The increase is the same or worse than at the 1,520 intersections with traffic lights that do not have red-light cameras.

Seventeen of the 45 intersections now covered by red-light cameras were ranked among the 50 most accident-prone locations in the District last year.

Individual results at intersections vary, the analysis shows.

The camera at New York Avenue and Fourth Street NW, for example — on one of Washington’s busiest commuter routes — has generated the most tickets in the city: more than 150,000 since 1999. Although the number of monthly citations there has dropped 65 percent, crashes nearly doubled, from 12 in 1998 to 23 last year.

The number of crashes has decreased in recent years at another busy spot, Bladensburg Road and New York Avenue NE, where cameras have generated more than 73,000 tickets. The intersection had 35 crashes in 1998, 88 in 2001 and 71 last year.

The camera at Wisconsin Avenue and Brandywine Street NW has produced nearly 30,000 tickets, but its crash totals have hovered around two a year.

Advocates for the cameras point to research such as a recent national study by the Federal Highway Administration that showed the number of broadside crashes dipped 25 percent at sites with cameras. The study found that rear-end crashes rose 15 percent at camera locations. But because broadside crashes are more dangerous and cause greater damage, the study concluded that the cameras can help reduce the costs of traffic accidents.

Gang-Len Chang, a professor of civil engineering at the University of Maryland, said cameras can be useful in reducing serious crashes if deployed properly.

Chang and the other traffic specialists said the city should not abandon red-light cameras. Rather, they said, the mixed results indicate that D.C. officials should conduct a thorough review of camera sites.

“They definitely should look at the locations and find where the cameras would be much more effective,” said Nicholas J. Garber, a professor of civil engineering at the University of Virginia who studied the use of red-light cameras in Fairfax County.

Published in: on March 2, 2008 at 10:21 pm  Leave a Comment  

• Red Light Cameras Increase Accidents

•Arizona: Speed Camera Under Investigation in Fatal Crash[click]
•Rome, Georgia Red Light Cameras Increase Wrecks, Profit[click]
•Bakersfield, California Red Light Camera Accidents Up[click]
Stockton, California Report Shows Accidents Jump With Cameras
Houston Red Light Cameras Fail to Prove Safety Benefit

Red-Light Cameras Increase Accidents: 5 Studies That Prove It

From the National Motor Association: January 8th, 2008 Posted in Red-Light Cameras The NMA has been contending that red-light cameras (RLCs) are a detriment to motorist safety for many years.

People, both in the media and in the general public, often dismiss this claim as opinion, suggest that there isn’t enough data available yet, ask why we support people who run red lights (we don’t), or write off the organization as being biased.

The only way to combat this is through hard facts and independent research. Luckily, we have both.

We reiterate our challenge: If it’s not about the money, then prove it.

No community has accepted, which shouldn’t be surprising considering the facts.

Here are five independent studies that demonstrate the failure of red-light cameras as a safety measure:

1) A Long Term Study of Red-Light Cameras and Accidents
David Andreassen
Australian Road Research Board
February, 1995

This study examined the long term effect on accident-types of red-light cameras at 41 signalized intersections in Melbourne, Australia. The cameras were installed in 1984, and reported accidents for the period 1979 to 1989 were used in the detailed analysis.

Quotes from the study:

“The results of this study suggest that the installation of the RLC at these sites did not provide any reduction in accidents, rather there has been increases in rear end and adjacent approaches accidents on a before and after basis and also by comparison with the changes in accidents at intersection signals.”

“There has been no demonstrated value of the RLC as an effective countermeasure.”

Download The Full Study

2) The Impact of Red Light Cameras (Photo-Red Enforcement) on Crashes in Virginia
Virginia Transportation Research Council
June 2007

The Virginia Transportation Research Council released a report expanding upon earlier research into the safety effects of red light cameras in Virginia. Despite showing an increase in crashes, this study was instrumental in the return of red-light cameras to the state of Virginia. With a proven negative safety impact, the clear incentive to bring back the cameras was money.

Quotes from the study:

“After cameras were installed, rear-end crashes increased for the entire six-jurisdiction study area… After controlling for time and traffic volume at each intersection, rear-end crash rates increased by an average of 27% for the entire study area.”

“After cameras were installed, total crashes increased.”

“The impact of cameras on injury severity is too close to call.”

“Based only on the study results presented herein and without referencing other studies, the study did not show a definitive safety benefit associated with camera installation with regard to all crash types, all crash severities, and all crash jurisdictions.”

Download The Full Study

3) The Red-Light Running Crisis: Is It Intentional?
Office of the Majority Leader
U.S. House of Representatives
May 2001

This report was prepared by former House Majority Leader Dick Armey’s staff. It looks at the problems of red-light cameras and how to really deal with traffic-light violations.

Quoted from the study:

“And one should ask the question, if there’s a problem with an intersection, why don’t safety engineers in the field just go out and fix the timing?

In fact, before red light cameras arrived in the United States, that’s exactly what our regulations instructed them to do. If too many people enter on red at an intersection, engineers were supposed to lengthen its yellow time. But in the year that red light cameras first started collecting millions in revenue on our shores, those entrusted with developing our traffic safety regulations dropped the requirement to fix signal timing, instructing engineers to “use enforcement” instead.

Indeed, according to the Federal Highway Administration, these problem intersections serve as a great location to hold a press conference. The agency offers a script for local officials to exploit a tragically mistimed intersection to call for the installation of additional red light cameras and tout their safety benefits.

But none of the reports that are supposed to tell us that red light cameras are responsible safety benefits actually say that. First, they dismiss increases in rear-end collisions associated with red light cameras as “non-significant,” despite evidence to the contrary. Second, they do not actually look at red light intersection accidents. The latest accident study in Oxnard, California, for example, only documents accident reductions “associated with”—not caused by— red light cameras. Although that statement has little scientific value, it does have great marketing appeal if you don’t look too closely.

Every study claiming red light cameras increase safety is written by the same man. Before joining the Insurance Institute for Highway Safety (IIHS), he was a top transportation official in New York City at the time the city began looking into becoming the first jurisdiction in the country to install red light cameras. In other words, the father of the red light camera in America is the same individual offering the “objective” testimony that they are effective.

A similar conflict of interest affects those entrusted with writing safety regulations for our traffic lights. The Institute of Transportation Engineers is actively involved in lobbying for, and even drafting legislation to implement, red light cameras. They are closely tied to the Insurance Institute for Highway Safety (IIHS), which in turn is funded by companies that stand to profit handsomely any time points are assessed to a driver’s license.

In short, the only documented benefit to red light cameras is to the pocketbook of local governments who use the devices to collect millions in revenue.”

Download The Full Study

4) Investigation Of Crash Risk Reduction Resulting From Red-Light Cameras In Small Urban Areas
Mark Burkey, Ph.D. & Kofi Obeng, Ph.D.
North Carolina Agricultural & Technical State University
July 2004

A study prepared by the North Carolina A&T State University’s Urban Transit Institute for the United States Department of Transportation.

Quoted from the study:

“Using a large data set, including 26 months before the introduction of RLCs, we analyze reported accidents occurring near 303 intersections over a 57-month period, for a total of 17,271 observations. Employing maximum likelihood estimation of Poisson regression models, we find that:

The results do not support the view that red light cameras reduce crashes. Instead, we find that RLCs are associated with higher levels of many types and severity categories of crashes.”

Download The Full Study

5) Evaluation of the Red-Light-Camera-Enforcement Pilot Project
Ontario Ministry of Transportation
December 2003

This report from Ontario, Canada’s Ministry of Transportation’s concluded that jurisdictions using photo enforcement experienced an overall increase in property damage and fatal and injury rear-end collisions. The report also concludes that there was an overall reduction in serious accidents and angle collisions. However, a closer look at the data found in this government-sponsored report show that intersections monitored by cameras experienced, overall, a 2 percent increase in fatal and injury collisions compared to a decrease of 12.7 percent in the camera-free intersections that were used as a control group (page 21).

In fact, the non-camera intersections fared better than the camera intersections in every accident category.

Quoted from the study:

“Exhibit 2 indicates the red light running treatments have:

* Contributed to a 4.9 per cent increase in fatal and injury rear-end collisions; and
* Contributed to a 49.9 per cent increase in property damage only rear-end collisions.

The rear-end collision results are similar to findings in other red light camera studies.”

Download The Full Study

This is by no means an exhaustive list. You can find more studies on the NMA website here: Photo Enforcement Studies.

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• I’m Against Red Light Cameras

Guy W. Midkiff
February 27, 2008
Red Light Cameras

Recently, when I spoke at the Washington Women Republicans luncheon, the issue of Red Light Cameras came up. My opinion was that I found them intrusive and just one more example of our civil rights being diminished, but if they saved lives then it would be hard to ultimately argue against them. It is not hard to visualize your family being killed by an impaired driving slicing through a red light.

But, none-the-less, there was something that really bothered me, an itch I couldn’t scratch, regarding these lights. First, and foremost, when government has a program that generates cash, then I try to follow the money and see where it ends up and how it is used. Today, I don’t think the City has clearly articulated the transparency of the money trail. The City of Arnold is now being sued over red light cameras and even the City Council members are being named in the suit.

But also, I dare to ask questions, which has riled feathers on more than one occasion. Personally I have become just a little annoyed by the City using the “Safety Card” every time they want to ram through another program or ordinance. (Think $36K light poles, occupancy inspections, traffic quotas, and the pending Camp Street Bridge (or what the locals call the “Walmart Bridge”)

Do I care about safety and the sanctity of life? Heck yes I do care about life. I found it very interesting, though, that one does not have to go far when it comes to finding research on red light cameras. Recently the mayor of St. Peters, Missouri, Shawn Brown, was found guilty of soliciting a bribe for passing a city ordinance regarding red light cameras. He is now facing 20 years in the pokey and a $250,000 fine. The corrupting influence of money should never be underestimated.

Jay Nixon has come out against RLC’s (red light cameras), legislation is pending against them, Alaska actually terminated their RLC’s, not to mention considerable scientific statistical research that flies in the face of the claim that RLC’s improve safety (more on that later). I think one of my biggest complaints against the RLC is that the presumption of innocence is tossed out the window. Presumption of innocence is the corner stone of our legal system and we should think about the unintended consequences before we go monkeying around with these Constitutional Rights. When you came your surprise-o-gram from the City, you will be presumed guilty. It will be up to you to prove your innocence – kinda turns our entire legal system on its rear end.

And now for the eureka piece, the pièces de résistance, the trump of all trump cards: SAFETY. Many communities, which have installed RLC’s, are producing anecdotal data to support their safety argument. These findings are not scientific and are of practically no value. For valid results, large sample sets must be used over a long period of time. It is impossible to install RLC’s, point to a specific trend and say, “Ah ha, RLC’s saves lives.” Please read my blog (click here) on the RLC Myth for more on the scientific study that was conducted by the North Carolina A&T State University which irrefutably dispels the safety claim for RLC’s.

I feel that RLC’s are not good for the community. I think history proves that corruption, conspiracy and controversy mark RLC’s. My opinion is that they are just another extension of the long arm of big brother and is an invasion of your civil rights. And did I mention the money? Some very conservative estimates are that the City of Washington will rake in somewhere around $350,000 per year, PER INTERSECTION! Sure, it’s all about your safety.

DON’T BELIEVE ME. LISTEN TO HOW THE RLC COMPANIES ARE PITCHING THEIR CAMERAS:

Camera Maker Admits Ticketing is Addictive
Cities get addicted to red light camera and speed camera revenue according to the CEO of Affiliated Computer Services.

Lynn BlodgettA top vendor of speed camera and red light camera services told investors that his company represents a great investment opportunity because the cities who use his product cannot resist the steady revenue stream it creates. Lynn Blodgett, CEO of Affiliated Computer Services (ACS), spoke earlier this month to the Technology, Telecom and Internet Conference hosted by the Thomas Weisel Partners investment bank. Blodgett made the pitch that no matter how bad the economy might get, there never be a lack of demand for outsourcing large-scale government programs to ACS.

“As an overall statement, people are typically in tougher economic times,” Blodgett said. “Our clients are typically more attuned to outsourcing and doing more because they need to save money. And so in that way we tend to — we say we’re a good company in good time and we’re a great company in bad times and it’s because the services we provide are mission-critical.”

The most critical programs for state and municipal governments in tough economic times, Blodgett argued, were those that transfer money from taxpayers to the government. He suggested that once a city tries red light cameras, it will never go back.

“The government services that we provide are either funded as part of entitlement programs, or they help generate revenue,” Blodgett said. “I mean, a red light camera system for a city generates a lot of revenue and so they’re not going to cut back on those type of areas in an economically challenged time.”

• RLC – More Research

Red Light Camera Studies Roundup (From TheNewsPaper.com)
A collection of red light camera studies over the last decade shows red light cameras have serious side-effects.

Over the past decade, a number of studies have examined the use of red light cameras. The most relevant studies examined the devices in light of changes in traffic and engineering conditions made at intersections during the study period and pulled actual police reports to examine the particular causes of each collision. The following studies are the most comprehensive available:

  • A 2007 Virginia Department of Transportation study found:
    “The cameras were associated with an increase in total crashes… The aggregate EB results suggested that this increase was 29%… The cameras were associated with an increase in the frequency of injury crashes… The aggregate EB results suggested an 18% increase, although the point estimates for individual jurisdictions were substantially higher (59%, 79%, or 89% increases) or lower (6% increase or a 5% decrease).”
    Read a summary
    PDF Version Full copy, 1mb pdf
  • A 2006 Winnipeg, Canada city audit found:
    “The graph shows an increase of 58% in the number of traffic collisions from 2003 to 2004…. Contrary to long-term expectations, the chart shows an increase in claims at each level of damage with the largest percentage increase appearing at the highest dollar value.”
    Read a summary
    PDF Version Full copy, 541k pdf
  • A 2005 Virginia DOT study found:
    “The cameras are correlated with an increase in total crashes of 8% to 17%.”
    Read a summary
    PDF Version Full copy, 1.7mb pdf
  • In 2005, The Washington Post found:
    “The analysis shows that the number of crashes at locations with cameras more than doubled, from 365 collisions in 1998 to 755 last year. Injury and fatal crashes climbed 81 percent, from 144 such wrecks to 262. Broadside crashes, also known as right-angle or T-bone collisions, rose 30 percent, from 81 to 106 during that time frame.”
    Read a summary
    Full article on the Post website
  • A 2004 North Carolina A&T University study found:
    “Our findings are more pessimistic, finding no change in angle accidents and large increases in rear-end crashes and many other types of crashes relative to other intersections.”
    Read a summary
    PDF Version Full copy, 1.7mb pdf
  • A 2003 Ontario Ministry of Transportation study found:
    “Compared to the average number of reported collisions occurring in the before period, the average yearly number of reported collisions increased 15.1 per cent in the after period.”
    Read a summary
    PDF Version Full copy, 1.5mb pdf
  • A 1995 Australian Road Research Board study found:
    “The results of this study suggest that the installation of the RLC at these sites did not provide any reduction in accidents, rather there has been increases in rear end and adjacent approaches accidents on a before and after basis and also by comparison with the changes in accidents at intersection signals.”
    Read a summary
    PDF Version Full copy, 2.4mb pdf
  • A 1995 Monash University (Australia) study found:
    “a simple correlation analysis was undertaken for red light running data in the current study and revealed no significant relationship between the frequency of crashes at RLC and non-RLC sites and differences in red light running behaviour.”
    Read a summary

Related Reports and Studies

The importance of the yellow warning signal time in reducing the instances of red light running is found in the following reports:

  • A 2004 Texas Transportation Institute study found:
    “An increase in yellow duration of 1.0 seconds is associated with a [crash frequency] of about 0.6, which corresponds to a 40 percent reduction in crashes.”
    Read a summary
    PDF Version Full copy, 1.5mb pdf
  • A 2001 report by the Majority Leader of the U.S. House of Representatives found:
    “The changes in the yellow signal timing regulations have resulted in the inadequate yellow times. And these inadequate yellow times are the likely cause of almost 80 percent of red light entries.”
    Full version with summary
Published in: on February 27, 2008 at 12:42 pm  Comments (1)  

• Hancock Amendment Loophole Explained

Guy W. Midkiff
1-20-08
Guy W. Midkiff

Hancock Amendment Loophole Explained

Taxing districts have a tax rate ceiling and a tax rate levy. The tax rate ceiling is the maximum authorized voter approved levy. However, taxing districts may levy a rate below their tax rate ceiling. During a reassessment year, if the taxing district levies a rate below their tax rate ceiling, the taxing entity could leave the rate the same on the sometimes higher assessments. The Hancock Amendment requires that the tax rate ceiling roll back, not necessarily the tax rate levy. Senator Gibbons and other legislators are trying to close this loophole by requiring taxing districts, in a reassessment year, to roll back their prior year’s tax rate levy regardless if the taxing district levied a rate the same as the ceiling. In a non-reassessment year, the taxing district could increase their tax rate levy to their tax rate ceiling. The intention behind this change is to prevent the process of reassessment, which is the equalization of the tax burden of the property owners in taxing districts, from causing tax increases.

An example is as follows:

Tax district X has a 2006 assessed valuation of $100,000,000, a tax rate of $1.00, and a tax rate ceiling of $1.50.

Tax Rate: ($100,000,000/100) X $1.00 = $1,000,000

In 2006, tax district X collected $1,000,000.

Tax Ceiling: ($100,000,000/100) X $1.50 = $1,500,000

In 2006, the taxing district could have collected $1,500,000 if they levied a rate equal to their tax rate ceiling.

In 2007, the properties in taxing district X were reassessed at a value of $125,000,000. $5,000,000 of the increase is new construction and improvements, which is not factored into the rollback, and $20,000,000 of the increase is due to the value of the properties increasing in value. The growth in the consumer price index in 2007 was 2.6%.

Under current law, only the tax ceiling is required to rollback in accordance with the Hancock Amendment and tax district X’s ceiling would rollback as follows:

$1,500,000 X 1.026 = $1,539,000

$125,000,000 – $5,000,000 = $120,000,000

$1,539,000/$120,000,000 = .01285

.01285 X 100 = $1.285

The tax rate ceiling for tax district X would be $1.285. Tax district X could legally keep the tax rate $1.00 and receive a windfall from reassessment.

Senate Bill 711, however, would require the taxing district to rollback its 2006 tax rate as if it were its tax rate ceiling in a reassessment year.

$1,000,000 X 1.026 = $1,026,000

$125,000,000 – $5,000,000 = $120,000,000

$1,026,000/$120,000,000 = .00855

.00855 X100 = $.855

Under Senate Bill 711, tax district X could have levied a maximum of $.855 in 2007.

The taxing district would be able to levy up to its tax rate ceiling in the non-reassessment year.

Another loophole that Senator Gibbons is trying to close relates to the manner in which taxing districts apply tax increases.

Currently, taxing districts can apply new voter approved levies to future and unknown assessments, many times reaping an unaccounted tax increase in addition to the newly approved tax increase. Senate Bill 711 closes this loophole by requiring taxing districts to apply the new approved levy to the assessments most recently certified by the State Tax Commission.

An example of how this works is as follows:

In 2006, tax district Y had an assessed valuation of $500,000,000, a tax rate of $1.00 and a tax rate ceiling of $1.00.

In November of 2006, tax district Y submits a tax increase to its voters which passes, increasing its tax rate ceiling to $1.25 for the 2007 tax year.

$500,000,000/100 = $5,000,000

$5,000,000 X $1.00

$5,000,000 X $1.25 = $6,250,000

Residents of tax district Y approved a tax increase of $1,250,000 for a total of $6,250,000.

In 2007, the properties in tax district Y are reassessed producing a total assessed valuation of $625,000,000. $25,000,000 of the increase in assessed value is due to new construction and improvements and $100,000,000 of the increase in assessed valuation is due to the value of the properties in the district increasing in value.

Legally, however, because of how state law is currently written, taxing districts can apply the new approved $1.25 levy to 2007 assessments. The $1.25 tax rate ceiling does not rollback in 2007 to account for the changes in assessed valuation.

$625,000,000 -$25,000,000 = $600,000,000

$600,000,000/100 = $6,000,000

$6,000,000 X $1.25 = $7,500,000

The voters of tax district Y have unsuspectingly approved a tax increase of $2,500,000, $1,250,000 more than they thought they had approved.

Senate Bill 711 would require the $1.25 tax rate for tax district Y to rollback according to the increases in assessed valuation in 2007.

$6,250,000 X 1.026 = $6,412,500

$6,412,500/$600,000,000 = .0106875

.0106875 X 100 = $1.0688

Under SB 711, the most the tax district Y could levy in 2007 would be $1.0688, not $1.25.

This loophole has been in effect since 2003 (when the interpretation of the law was changed, the result of an Attorney General memo, 107-2003). Taxing districts have taken advantage of the loophole in the past, but SB 711 closes this loophole and ensures that taxing districts will not gain windfalls from reassessment.

• Closing Hancock Amendment Loophole

EXPLANATION

 

This is a House Joint Resolution amends our Constitution.  The brackets delete the words [maximum authorized]

 

Maximum Authorized refers to the Tax Rate Ceiling.  As you recall unless a taxing entity exceeds their tax rate ceiling or maximum authorized levy, they are not required by current law to roll back their tax rate.  By removing these words, taxing jurisdictions will be required to roll back their tax rates based on their previous years levy.  The state tax commission informs me that the only way to properly force the roll backs is by amending the constitution.  Even though my HB 1349 accomplishes the same, the tax commission believes that the changes in statue would be subject to court challenge unless the changes are also reflected in our state constitution.

HB 1349 (Complete Text Link)

 

http://www.house.mo.gov/billtracking/bills081/biltxt/intro/HB1349I.htm

 

(Summary & Summary Link)

 

http://www.house.mo.gov/billtracking/bills081/bilsum/intro/sHB1349I.htm

 

HB 1349 -- Property Tax Rates
 
Sponsor:  Portwood
 
This bill revises the definition of "tax rate ceiling" to the tax
rate used by the taxing authority in the preceding year and
limits the revenue received from a voter-approved tax rate
increase to the amount determined by applying the levy increase
to the prior year's assessed valuation.

 

This legislation closes the loophole that taxing jurisdiction use to skirt the Hancock amendment.  Currently, if a taxing authority is not at their “tax rate” ceiling, they are not required to roll back their tax rate regardless of the amount of revenue they receive from re-assessment.  This change simply requires taxing authorities to roll back their tax rate based upon the previous year’s tax rate NOT their maximum allowed ceiling.  The bill also requires that voter approved levy increase must be rolled back to the revenue generated in the no re-assessment year so that taxing jurisdictions cannot experience a non voter approved windfall from re-assessment.

HOUSE BILL NO. 1349

94TH GENERAL ASSEMBLY


 INTRODUCED BY REPRESENTATIVES PORTWOOD (Sponsor), JONES (89), CUNNINGHAM (86), LEMBKE AND BIVINS (Co-sponsors).

                  Pre-filed December 3, 2007 and copies ordered printed.

D. ADAM CRUMBLISS, Chief Clerk

3697L.01I


AN ACT

To repeal section 137.073, RSMo, and to enact in lieu thereof one new section relating to             property tax rate revisions.


 

Be it enacted by the General Assembly of the state of Missouri, as follows:

            Section A. Section 137.073, RSMo, is repealed and one new section enacted in lieu thereof, to be known as section 137.073, to read as follows:

            137.073. 1. As used in this section, the following terms mean:

            (1) “General reassessment”, changes in value, entered in the assessor’s books, of a substantial portion of the parcels of real property within a county resulting wholly or partly from reappraisal of value or other actions of the assessor or county equalization body or ordered by the state tax commission or any court;

            (2) “Tax rate”, “rate”, or “rate of levy”, singular or plural, includes the tax rate for each purpose of taxation of property a taxing authority is authorized to levy without a vote and any tax rate authorized by election, including bond interest and sinking fund;

            (3) “Tax rate ceiling”, [a] the tax rate [as revised] used by the taxing authority [to comply with the provisions of this section or when a court has determined] in the preceding year or the tax rate determined by a court; except that, other provisions of law to the contrary notwithstanding, a school district may levy the operating levy for school purposes required for the current year pursuant to subsection 2 of section 163.021, RSMo, less all adjustments required pursuant to article X, section 22 of the Missouri Constitution, if such tax rate does not exceed the highest tax rate in effect subsequent to the 1980 tax year, provided that all levy assessments shall begin from the preceding year’s tax rate. This is the maximum tax rate that may be levied, unless a higher tax rate ceiling is approved by voters of the political subdivision as provided in this section;

            (4) “Tax revenue”, when referring to the previous year, means the actual receipts from ad valorem levies on all classes of property, including state-assessed property, in the immediately preceding fiscal year of the political subdivision, plus an allowance for taxes billed but not collected in the fiscal year and plus an additional allowance for the revenue which would have been collected from property which was annexed by such political subdivision but which was not previously used in determining tax revenue pursuant to this section. The term “tax revenue” shall not include any receipts from ad valorem levies on any property of a railroad corporation or a public utility, as these terms are defined in section 386.020, RSMo, which were assessed by the assessor of a county or city in the previous year but are assessed by the state tax commission in the current year. All school districts and those counties levying sales taxes pursuant to chapter 67, RSMo, shall include in the calculation of tax revenue an amount equivalent to that by which they reduced property tax levies as a result of sales tax pursuant to section 67.505, RSMo, and section 164.013, RSMo, or as excess home dock city or county fees as provided in subsection 4 of section 313.820, RSMo, in the immediately preceding fiscal year but not including any amount calculated to adjust for prior years. For purposes of political subdivisions which were authorized to levy a tax in the prior year but which did not levy such tax or levied a reduced rate, the term “tax revenue”, as used in relation to the revision of tax levies mandated by law, shall mean the revenues equal to the amount that would have been available if the voluntary rate reduction had not been made.

            2. Whenever changes in assessed valuation are entered in the assessor’s books for any personal property, in the aggregate, or for any subclass of real property as such subclasses are established in section 4(b) of article X of the Missouri Constitution and defined in section 137.016, the county clerk in all counties and the assessor of St. Louis City shall notify each political subdivision wholly or partially within the county or St. Louis City of the change in valuation of each subclass of real property, individually, and personal property, in the aggregate, exclusive of new construction and improvements. All political subdivisions shall immediately revise the applicable rates of levy for each purpose for each subclass of real property, individually, and personal property, in the aggregate, for which taxes are levied to the extent necessary to produce from all taxable property, exclusive of new construction and improvements, substantially the same amount of tax revenue as was produced in the previous year for each subclass of real property, individually, and personal property, in the aggregate, except that the rate may not exceed the greater of the rate in effect in the 1984 tax year or the [most recent voter-approved] preceding year’s tax rate. Such tax revenue shall not include any receipts from ad valorem levies on any real property which was assessed by the assessor of a county or city in such previous year but is assessed by the assessor of a county or city in the current year in a different subclass of real property. Where the taxing authority is a school district for the purposes of revising the applicable rates of levy for each subclass of real property, the tax revenues from state-assessed railroad and utility property shall be apportioned and attributed to each subclass of real property based on the percentage of the total assessed valuation of the county that each subclass of real property represents in the current taxable year. As provided in section 22 of article X of the constitution, a political subdivision may also revise each levy to allow for inflationary assessment growth occurring within the political subdivision. The inflationary growth factor for any such subclass of real property or personal property shall be limited to the actual assessment growth in such subclass or class, exclusive of new construction and improvements, and exclusive of the assessed value on any real property which was assessed by the assessor of a county or city in the current year in a different subclass of real property, but not to exceed the consumer price index or five percent, whichever is lower. Should the tax revenue of a political subdivision from the various tax rates determined in this subsection be different than the tax revenue that would have been determined from a single tax rate as calculated pursuant to the method of calculation in this subsection prior to January 1, 2003, then the political subdivision shall revise the tax rates of those subclasses of real property, individually, and/or personal property, in the aggregate, in which there is a tax rate reduction, pursuant to the provisions of this subsection. Such revision shall yield an amount equal to such difference and shall be apportioned among such subclasses of real property, individually, and/or personal property, in the aggregate, based on the relative assessed valuation of the class or subclasses of property experiencing a tax rate reduction. Such revision in the tax rates of each class or subclass shall be made by computing the percentage of current year adjusted assessed valuation of each class or subclass with a tax rate reduction to the total current year adjusted assessed valuation of the class or subclasses with a tax rate reduction, multiplying the resulting percentages by the revenue difference between the single rate calculation and the calculations pursuant to this subsection and dividing by the respective adjusted current year assessed valuation of each class or subclass to determine the adjustment to the rate to be levied upon each class or subclass of property. The adjustment computed herein shall be multiplied by one hundred, rounded to four decimals in the manner provided in this subsection, and added to the initial rate computed for each class or subclass of property. Notwithstanding any provision of this subsection to the contrary, no revision to the rate of levy for personal property shall cause such levy to increase over the levy for personal property from the prior year.

            3. (1) Where the taxing authority is a school district, it shall be required to revise the rates of levy from the preceding year’s tax rate to the extent necessary to produce from all taxable property, including state-assessed railroad and utility property, which shall be separately estimated in addition to other data required in complying with section 164.011, RSMo, substantially the amount of tax revenue permitted in this section. In the year following tax rate reduction, the tax rate ceiling may be adjusted to offset such district’s reduction in the apportionment of state school moneys due to its reduced tax rate. However, in the event any school district, in calculating a tax rate ceiling pursuant to this section, requiring the estimating of effects of state-assessed railroad and utility valuation or loss of state aid, discovers that the estimates used result in receipt of excess revenues, which would have required a lower rate if the actual information had been known, the school district shall reduce the tax rate ceiling in the following year to compensate for the excess receipts, and the recalculated rate shall become the tax rate ceiling for purposes of this section.

            (2) For any political subdivision which experiences a reduction in the amount of assessed valuation relating to a prior year, due to decisions of the state tax commission or a court pursuant to sections 138.430 to 138.433, RSMo, or due to clerical errors or corrections in the calculation or recordation of any assessed valuation:

            (a) Such political subdivision may revise the tax rate ceiling for each purpose it levies taxes to compensate for the reduction in assessed value occurring after the political subdivision calculated the tax rate ceiling for the particular subclass of real property or for personal property, in the aggregate, in the prior year. Such revision by the political subdivision shall be made at the time of the next calculation of the tax rate for the particular subclass of real property or for personal property, in the aggregate, after the reduction in assessed valuation has been determined and shall be calculated in a manner that results in the revised tax rate ceiling being the same as it would have been had the corrected or finalized assessment been available at the time of the prior calculation;

            (b) In addition, for up to three years following the determination of the reduction in assessed valuation as a result of circumstances defined in this subdivision, such political subdivision may levy a tax rate for each purpose it levies taxes above the revised tax rate ceiling provided in paragraph (a) of this subdivision to recoup any revenues it was entitled to receive for the three-year period preceding such determination.

            4. (1) In order to implement the provisions of this section and section 22 of article X of the Constitution of Missouri, the term “improvements” shall apply to both real and personal property. In order to determine the value of new construction and improvements, each county assessor shall maintain a record of real property valuations in such a manner as to identify each year the increase in valuation for each political subdivision in the county as a result of new construction and improvements. The value of new construction and improvements shall include the additional assessed value of all improvements or additions to real property which were begun after and were not part of the prior year’s assessment, except that the additional assessed value of all improvements or additions to real property which had been totally or partially exempt from ad valorem taxes pursuant to sections 99.800 to 99.865, RSMo, sections 135.200 to 135.255, RSMo, and section 353.110, RSMo, shall be included in the value of new construction and improvements when the property becomes totally or partially subject to assessment and payment of all ad valorem taxes. The aggregate increase in valuation of personal property for the current year over that of the previous year is the equivalent of the new construction and improvements factor for personal property. Notwithstanding any opt-out implemented pursuant to subsection 15 of section 137.115, the assessor shall certify the amount of new construction and improvements and the amount of assessed value on any real property which was assessed by the assessor of a county or city in such previous year but is assessed by the assessor of a county or city in the current year in a different subclass of real property separately for each of the three subclasses of real property for each political subdivision to the county clerk in order that political subdivisions shall have this information for the purpose of calculating tax rates pursuant to this section and section 22, article X, Constitution of Missouri. In addition, the state tax commission shall certify each year to each county clerk the increase in the general price level as measured by the Consumer Price Index for All Urban Consumers for the United States, or its successor publications, as defined and officially reported by the United States Department of Labor, or its successor agency. The state tax commission shall certify the increase in such index on the latest twelve-month basis available on June first of each year over the immediately preceding prior twelve-month period in order that political subdivisions shall have this information available in setting their tax rates according to law and section 22 of article X of the Constitution of Missouri. For purposes of implementing the provisions of this section and section 22 of article X of the Missouri Constitution, the term “property” means all taxable property, including state-assessed property.

            (2) Each political subdivision required to revise rates of levy pursuant to this section or section 22 of article X of the Constitution of Missouri shall calculate each tax rate it is authorized to levy and, in establishing each tax rate, shall consider each provision for tax rate revision provided in this section and section 22 of article X of the Constitution of Missouri, separately and without regard to annual tax rate reductions provided in section 67.505, RSMo, and section 164.013, RSMo. Each political subdivision shall set each tax rate it is authorized to levy using the calculation that produces the lowest tax rate ceiling. It is further the intent of the general assembly, pursuant to the authority of section 10(c) of article X of the Constitution of Missouri, that the provisions of such section be applicable to tax rate revisions mandated pursuant to section 22 of article X of the Constitution of Missouri as to reestablishing tax rates as revised in subsequent years, enforcement provisions, and other provisions not in conflict with section 22 of article X of the Constitution of Missouri. Annual tax rate reductions provided in section 67.505, RSMo, and section 164.013, RSMo, shall be applied to the tax rate as established pursuant to this section and section 22 of article X of the Constitution of Missouri, unless otherwise provided by law.

            5. (1) In all political subdivisions, the tax rate ceiling established pursuant to this section shall not be increased unless approved by a vote of the people. Approval of the higher tax rate shall be by at least a majority of votes cast. When a proposed higher tax rate requires approval by more than a simple majority pursuant to any provision of law or the constitution, the tax rate increase must receive approval by at least the majority required.

            (2) When voters approve an increase in the tax rate, the amount of the increase shall be added to the tax rate ceiling as calculated pursuant to this section to the extent the total rate does not exceed any maximum rate prescribed by law. The amount of revenue received from the voter-approved increase in the tax rate shall not exceed the revenue derived by applying the levy increase to the preceding year’s assessed valuation as certified by the state tax commission. If a ballot question presents a stated tax rate for approval rather than describing the amount of increase in the question, the stated tax rate approved shall be the current tax rate ceiling. The increased tax rate ceiling as approved may be applied to the total assessed valuation of the political subdivision at the setting of the next tax rate.

            (3) The governing body of any political subdivision may levy a tax rate lower than its tax rate ceiling [and may increase that lowered tax rate to a level not exceeding the tax rate ceiling without voter approval].

            6. (1) For the purposes of calculating state aid for public schools pursuant to section 163.031, RSMo, each taxing authority which is a school district shall determine its proposed tax rate as a blended rate of the classes or subclasses of property. Such blended rate shall be calculated by first determining the total tax revenue of the property within the jurisdiction of the taxing authority, which amount shall be equal to the sum of the products of multiplying the assessed valuation of each class and subclass of property by the corresponding tax rate for such class or subclass, then dividing the total tax revenue by the total assessed valuation of the same jurisdiction, and then multiplying the resulting quotient by a factor of one hundred. Where the taxing authority is a school district, such blended rate shall also be used by such school district for calculating revenue from state-assessed railroad and utility property as defined in chapter 151, RSMo, and for apportioning the tax rate by purpose.

            (2) Each taxing authority proposing to levy a tax rate in any year shall notify the clerk of the county commission in the county or counties where the tax rate applies of its tax rate ceiling and its proposed tax rate. Each taxing authority shall express its proposed tax rate in a fraction equal to the nearest one-tenth of a cent, unless its proposed tax rate is in excess of one dollar, then one/one-hundredth of a cent. If a taxing authority shall round to one/one-hundredth of a cent, it shall round up a fraction greater than or equal to five/one-thousandth of one cent to the next higher one/one-hundredth of a cent; if a taxing authority shall round to one-tenth of a cent, it shall round up a fraction greater than or equal to five/one-hundredths of a cent to the next higher one-tenth of a cent. Any taxing authority levying a property tax rate shall provide data, in such form as shall be prescribed by the state auditor by rule, substantiating such tax rate complies with Missouri law. All forms for the calculation of rates pursuant to this section shall be promulgated as a rule and shall not be incorporated by reference. The state auditor shall promulgate rules for any and all forms for the calculation of rates pursuant to this section which do not currently exist in rule form or that have been incorporated by reference. In addition, each taxing authority proposing to levy a tax rate for debt service shall provide data, in such form as shall be prescribed by the state auditor by rule, substantiating the tax rate for debt service complies with Missouri law. A tax rate proposed for annual debt service requirements will be prima facie valid if, after making the payment for which the tax was levied, bonds remain outstanding and the debt fund reserves do not exceed the following year’s payments. The county clerk shall keep on file and available for public inspection all such information for a period of three years. The clerk shall, within three days of receipt, forward a copy of the notice of a taxing authority’s tax rate ceiling and proposed tax rate and any substantiating data to the state auditor. The state auditor shall, within fifteen days of the date of receipt, examine such information and return to the county clerk his or her findings as to compliance of the tax rate ceiling with this section and as to compliance of any proposed tax rate for debt service with Missouri law. If the state auditor believes that a taxing authority’s proposed tax rate does not comply with Missouri law, then the state auditor’s findings shall include a recalculated tax rate, and the state auditor may request a taxing authority to submit documentation supporting such taxing authority’s proposed tax rate. The county clerk shall immediately forward a copy of the auditor’s findings to the taxing authority and shall file a copy of the findings with the information received from the taxing authority. The taxing authority shall have fifteen days from the date of receipt from the county clerk of the state auditor’s findings and any request for supporting documentation to accept or reject in writing the rate change certified by the state auditor and to submit all requested information to the state auditor. A copy of the taxing authority’s acceptance or rejection and any information submitted to the state auditor shall also be mailed to the county clerk. If a taxing authority rejects a rate change certified by the state auditor and the state auditor does not receive supporting information which justifies the taxing authority’s original or any subsequent proposed tax rate, then the state auditor shall refer the perceived violations of such taxing authority to the attorney general’s office and the attorney general is authorized to obtain injunctive relief to prevent the taxing authority from levying a violative tax rate.

            7. No tax rate shall be extended on the tax rolls by the county clerk unless the political subdivision has complied with the foregoing provisions of this section.

            8. Whenever a taxpayer has cause to believe that a taxing authority has not complied with the provisions of this section, the taxpayer may make a formal complaint with the prosecuting attorney of the county. Where the prosecuting attorney fails to bring an action within ten days of the filing of the complaint, the taxpayer may bring a civil action pursuant to this section and institute an action as representative of a class of all taxpayers within a taxing authority if the class is so numerous that joinder of all members is impracticable, if there are questions of law or fact common to the class, if the claims or defenses of the representative parties are typical of the claims or defenses of the class, and if the representative parties will fairly and adequately protect the interests of the class. In any class action maintained pursuant to this section, the court may direct to the members of the class a notice to be published at least once each week for four consecutive weeks in a newspaper of general circulation published in the county where the civil action is commenced and in other counties within the jurisdiction of a taxing authority. The notice shall advise each member that the court will exclude him or her from the class if he or she so requests by a specified date, that the judgment, whether favorable or not, will include all members who do not request exclusion, and that any member who does not request exclusion may, if he or she desires, enter an appearance. In any class action brought pursuant to this section, the court, in addition to the relief requested, shall assess against the taxing authority found to be in violation of this section the reasonable costs of bringing the action, including reasonable attorney’s fees, provided no attorney’s fees shall be awarded any attorney or association of attorneys who receive public funds from any source for their services. Any action brought pursuant to this section shall be set for hearing as soon as practicable after the cause is at issue.

            9. If in any action, including a class action, the court issues an order requiring a taxing authority to revise the tax rates as provided in this section or enjoins a taxing authority from the collection of a tax because of its failure to revise the rate of levy as provided in this section, any taxpayer paying his or her taxes when an improper rate is applied has erroneously paid his or her taxes in part, whether or not the taxes are paid under protest as provided in section 139.031, RSMo. The part of the taxes paid erroneously is the difference in the amount produced by the original levy and the amount produced by the revised levy. The township or county collector of taxes or the collector of taxes in any city shall refund the amount of the tax erroneously paid. The taxing authority refusing to revise the rate of levy as provided in this section shall make available to the collector all funds necessary to make refunds pursuant to this subsection. No taxpayer shall receive any interest on any money erroneously paid by him or her pursuant to this subsection. Effective in the 1994 tax year, nothing in this section shall be construed to require a taxing authority to refund any tax erroneously paid prior to or during the third tax year preceding the current tax year.

            10. A taxing authority, including but not limited to a township, county collector, or collector of taxes, responsible for determining and collecting the amount of residential real property tax levied in its jurisdiction, shall report such amount of tax collected by December thirty-first of each year such property is assessed to the state tax commission. The state tax commission shall compile the tax data by county or taxing jurisdiction and submit a report to the general assembly no later than January thirty-first of the following year.

            11. Any rule or portion of a rule, as that term is defined in section 536.010, RSMo, that is created under the authority delegated in this section shall become effective only if it complies with and is subject to all of the provisions of chapter 536, RSMo, and, if applicable, section 536.028, RSMo. This section and chapter 536, RSMo, are nonseverable and if any of the powers vested with the general assembly pursuant to chapter 536, RSMo, to review, to delay the effective date, or to disapprove and annul a rule are subsequently held unconstitutional, then the grant of rulemaking authority and any rule proposed or adopted after August 28, 2004, shall be invalid and void.

 

• Tax and Spending Limits? TELs

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Cato Policy Analysis No. 213 July 25, 1994

Policy Analysis

Taming Leviathan:
Are Tax and Spending Limits the Answer?

by Dean Stansel

Dean Stansel is a fiscal policy analyst at the Cato Institute.


Executive Summary

After a decade of dormancy, the tax revolt is back. Fed up with rapidly rising state budgets, Americans are increasingly taking matters into their own hands, voting into law limits on the ability of state lawmakers to tax and spend. In the past two years, five states approved such populist measures. This year voters in as many as six states will have the opportunity to vote on some type of tax limitation initiative.

The opposition to tax and expenditure limitations (TELs) is enormous. Opponents charge that restraining the growth of taxes and spending is impossible without doing things like taking cops off the beat and firefighters out of the firehouse. Other critics make precisely the opposite complaint about TELs, charging that TELs are ineffective and do not limit the growth of taxes and spending as promised.

This study demonstrates that properly designed TELs can and do limit the growth of state taxes and spending. For example, the growth rate of per capita state spending in TEL states fell from 0.8 percentage points above the U.S. average in the five years preceding TEL enactment to 2.9 percentage points below the U.S. average in the five years after TEL enactment.

Unfortunately, many TELs are designed in a way that minimizes their effectiveness. This study examines that issue and provides a detailed description of how an effective TEL should be designed.

If the citizens of a state wish to limit the growth of Leviathan, they should not abandon TELs; instead, they should ensure that the TELs are properly constructed.

Introduction

The grassroots tax revolt, which began in the stagflationary years of the late 1970s, is brewing again. Though the misery index is not what it was in the days of Proposition 13, there is a rising sentiment among voters that state government has grown too large. That sentiment is groundedin reality: since 1980 total state spending has climbed by 60 percent (after adjusting for inflation).[1]

The movement for tax and expenditure limitations (TELs) is growing in much the same way the term-limits movement is. In 1991 two states–Connecticut and North Carolina–enacted TELs for the first time, and two other states–Colorado and Louisiana–modified their TELs. Since then five states have enacted measures to restrain the growth of taxes and spending.[2]

In March 1992 Oklahomans passed a constitutional amendment requiring all tax increases to pass both houses of the state legislature with a three-fourths majority or be approved by a majority of the voters.In November 1992 voters in Colorado passed Amendment 1, the Taxpayer Bill of Rights. That measure requires that any increase in taxes–state or local–be approved by the voters. It also limits spending growth to that necessary to keep pace with population growth and inflation.

Also in November 1992 voters in Connecticut passed a constitutional amendment limiting spending growth to the rate of growth of personal income or inflation, whichever is greater.

In 1992 an overwhelming 72 percent of Arizona voters approved a constitutional amendment requiring a two-thirds majority in the legislature for any increase in taxes or fees.

Finally, voters in Washington State approved a constitutional amendment in November 1993 that limits state spending growth to the rate of population growth plus inflation and requires voter approval of any tax increases that would exceed that limit.

All told, 23 states now have TELs. In addition, this year on election day in November, voters in as many as six states will have the chance to vote on some type of tax limitation initiative.[3] (Table A.1 in the appendix summarizes each of the prospective ballot initiatives.)

Although many critics have claimed that TELs are not an effective means of restraining the growth of taxes and spending, this study presents new evidence refuting those contentions. It finds that TELs, when designed properly, can be and have been an effective tool for restraining the growth of both taxes and spending.

The five-year growth rate of per capita state spending in TEL states fell from 0.8 percentage points above the U.S. average in the five years before TEL enactment to 2.9 percentage points below the U.S. average in the five years after enactment.Per capita spending in TEL states fell from 6.4 percent above the U.S. average in the year of TEL enactment to only 1.7 percent above the U.S. average in 1992.

If the level of per capita spending in TEL states had not declined, the state spending burden per family of four in those states would have been, on average, $450 more in 1992 than it was.

Similar declines in the growth and level of spending in TEL states were found when those states were compared with non-TEL-states, and an examination of state taxes and state and local spending shows the same pattern of change. In sum, TELs appear to have imposed restraint on the growth of state budgets and taxes.

Why TELs Are Needed

The expansion of government over the past several decades has been enormous. Since 1950 the real growth of government spending at all levels has outpaced population growth by a margin of almost eight to one. As a result, the per capita burden of government exploded upward by 254 percent, even after adjusting for inflation.[4]

Though real government spending at all levels surged by 480 percent from 1950 to 1990, real state government spending rose even faster, by 534 percent.[5] Over the last two decades that burden has been growing even larger.[6] As Figure 1 shows, from 1970 to 1980, real state spending grew more than two and a half times faster than population. More recently, from 1980 to 1990, real state spending grew over four times faster than the number of those it serves. Since 1980 many state budgets have nearly doubled in size, even after adjusting for inflation. State taxes have climbed at a similar pace.

Figure 1
State Spending Growth vs. Population Growth

Growing evidence indicates that voters do not want government to be as large as it has become. Exit polls on election day in November 1992 indicated that, given a choice between lower taxes and more government services, 55 percent of voters preferred to keep taxes down, even if that meant fewer government services, while only 36 percent said the opposite. One year later in a similar poll in New Jersey, an even higher 60 percent of voters said they would prefer lower taxes and fewer services, compared to just 33 percent who said the opposite.[7] It is in part such hostility to government that is driving the tax revolt. Not trusting politicians to restrain budget growth and rising tax burdens, Americans are increasingly taking matters into their own hands, voting into law strict limits on the ability of their state governments to tax and spend.

History of the Tax Revolt

In June 1978 voters in California, fed up with skyrocketing property taxes, overwhelmingly passed Proposition 13. Hatched by anti-tax crusader Howard Jarvis, Proposition 13 rolled back local property taxes to 1 percent of assessed valuation, limited assessment increases to the lower of 2 percent or the annual inflation rate, required two-thirds voter approval for new local taxes, and required two-thirds approval of the legislature to raise existing or impose new taxes.

The passage of Proposition 13 led to a push for numerous similar measures in other states. Between 1978 and 1980, 43 states adopted new limitations on local property taxes or new property tax relief plans. Emboldened by their success, the tax revolters took aim at state taxes as well. Between 1978 and 1982, 15 states reduced their general income tax rates, 10 indexed their personal income tax systems, 7 eliminated their gift taxes, and 6 repealed their inheritance taxes.[8]

In addition, explicit limits on spending were imposed. In 1976 New Jersey passed the first state TEL, and by 1982 TELs had been enacted in 20 states.[9] Though TEL enactment slowed along with the fervor of the tax revolt during the prosperous 1980s–only two additional states enacted TELs from 1983 to 1990–voter frustration is now reversing that trend.

What Other Studies Have Found

Many studies have contended that TELs do not effectively restrain the growth of government. For instance, Daphne Kenyon and Karen Benker examined the change in expenditures relative to personal income for TEL versus non-TEL states over the period 1978-83. They found that in some years TEL states saw slower spending growth than non-TEL states, while in other years TEL states saw faster spending growth than non-TEL states. Though Kenyon and Benker say that there is some evidence that TELs may have moderated spending in some states, they conclude that “for most states, TELs have not been a constraint on growth in taxing or spending.”[10]

Marcia Howard examined both state tax collections and state general fund expenditures as a share of personal income over the period 1980-87. She found that, while state taxes grew faster than personal income in TEL states, taxes outpaced income growth by slightly more in non-TEL states. Further, Howard found that state general fund expenditures as a share of personal income actually fell in TEL states, from 5.5 percent in 1979 to 5.41 percent in 1987, lower than spending in non-TEL states. She nevertheless concluded that, because the differences were small, there was an “absence of strong evidence that tax and expenditure limitations have been successful.”[11]

Dale Bails examined the change in five components of per capita state spending and revenue over the period 1981-85, the “post-tax revolt years.” He found that each of the measures grew more slowly in TEL states than in non-TEL states. For instance, per capita total general revenues rose 30 percent in TEL states compared to 36 percent in non-TEL states. However, Bails also found that the average annual growth of spending or revenue (the one to which the TEL applies) from the year of enactment to 1985 was lower than such growth over the period 1970 to the year of enactment in only one-third of the TEL states. Bails thus concluded that states’ TELs “resulted in virtually no success in limiting growth in their budgets.”[12]

James Cox and David Lowery examined the change in state spending and revenue relative to personal income in three TEL states, Michigan, South Carolina, and Tennessee. Each of those states was paired with a non-TEL state in its region. The authors found that TELs did not have a statistically discernible effect on the growth of government. Cox and Lowery concluded that “by and large, the behavior of the cap states has been similar to that of noncap states.”[13]

Each of those studies identifies specific factors that limit the effectiveness of TELs, many of which are related to the faulty design of individual TELs. Since TELs are often designed by politicians–the very people whose behavior TELs are intended to restrain–it should come as nosurprise that they frequently are worded in a way that makes their restraints as weak and easily circumvented as possible.

Despite their recognition that faulty design is often the root of the problem, most studies that find TELs to be ineffective do not recommend strengthening them by eliminat ing their flaws. Instead, the studies conclude that TELs should be abandoned.

In contrast, there have been several studies that have found TELs to be effective. Stephen Moore examined a variety of fiscal discipline mechanisms and found that average state spending as a share of income in TEL states fell from 4 percent higher than the average for non-TEL states in 1979 to 10 percent lower than the average for non-TEL states by 1987.[14]

Barry Poulson found that the impact of TELs on state spending during their first four years of existence was “negative for all [TEL] states and significant for seven of those states. . . . The implication is that for these seven states the absence of the TEL would have resulted in significantly greater increases in government expenditures in the short run.”[15]

So while there is some dispute as to whether TELs are effective at restraining the growth of government, even the staunchest TEL advocates will admit that TELs have not worked as well as proponents would have liked. There is broad agreement, however, on the importance of the design of TELs to their effectiveness.

Methodology

This study focuses primarily on the performance of TELs as a whole, with a few minor exceptions noted below. In later sections, the performance of well-designed and poorly designed TELs is compared.

To measure the effectiveness of TELs in restraining government growth, this study examines how the growth rates and levels of taxes and spending in states with TELs changed after the TELs were enacted.[16] To adjust for the effect of population changes, per capita figures were used.

Of the 23 states with TELs, 21 had enacted them by 1986. While no state enacted a TEL for the first time between 1986 and 1990, two states, Connecticut and North Carolina, have done so since 1990. Those two states are excluded because there is not yet sufficient data to adequately examine the effect of their TELs. In addition, Rhode Island and Nevada are excluded because their TELs are nonbinding, applying only to the governor’s recommended budget. Finally, Alaska is also excluded because of peculiarities in its budgetary structure that make comparisons with other states problematic.[17] Unless otherwise noted, “TEL-state average” herein refers to the 18 states with binding TELs that were enacted by 1986.[18] Table 1 lists those states and the years of initial TEL enactment.

Table A.2 gives the growth rate of spending in each of the 18 TEL states over the five years immediately preceding and the five years immediately following enactment of the TEL. The number of percentage points by which each TEL state’s spending growth rate differs from the U.S. average growth rate over those periods is then calculated.[19]

Table 1: States with Binding TELs
State
Year of Adoption
Arizona 1978
California 1979
Colorado 1977
Delaware 1980
Hawaii 1978
Idaho 1980
Louisiana 1979
Massachusetts 1986
Michigan 1978
Missouri 1980
Montana 1981
Oklahoma 1985
Oregon 1979
South Carolina 1980
Tennessee 1978
Texas 1978
Utah 1979
Washington 1979

A TEL-state average is then found for the percentage points by which the five-year growth rates differ from the U.S. average. That average summarizes how the growth rate of spending in TEL states changed relative to the growth rate of the U.S. average after enactment of a TEL.

The same methodology is used to compare TEL-state spending growth to the non-TEL-state average and to calculate and compare per capita state taxes and per capita state and local spending.[20] The results of those calculations for TEL states as a group are summarized below, and a completelist can be found in Tables A.3-A.6 in the appendix.[21]

State Spending

Most TELs are limits on spending. So the most direct way to evaluate the effectiveness of TELs is by examining their impact on state expenditures. If a TEL is effective, it should lower the growth rate of state spending. The average growth rate of per capita state spending in TELstates changed, relative to the U.S. average, in the following respects after TEL enactment.

The five-year growth rate of per capita state spending in TEL states fell from 0.8 percentage points above the U.S. average before TEL enactment to 2.9 percentage points below the U.S. average after TEL enactment (Figure 2).

Figure 2
Growth Rate of per Capita State Spending Relative to U.S. Average for the Five Years Immediately Preceeding and the Five Years Immediately Following TEL Enactment

The growth rate of per capita state spending in TEL states from the year of enactment through 1992, as opposed to just five years after enactment, fell even lower, to 12.1 percentage points below the U.S. average.The five-year real growth rate of per capita state spending in TEL states fell from 7.1 percent before TEL enactment to 1.8 percent after TEL enactment.

If the real growth rate of per capita state spending in TEL states had not slowed, the state spending burden per family of four would have been, on average, $400 higher in those states five years after TEL enactment and $450 higher in 1992 than it was with the lower rate of spending growth.

In addition to the growth rate’s falling (relative to the U.S. average), the average level of per capita state spending in TEL states fell from 6.4 percent above the U.S. average in the year of enactment to 1.7 percent above the U.S. average in 1992 (Figure 3).

Figure 3
Per Capita State Spending Relative to U.S. Average, Year of TEL Enactment and 1992

State Taxes

Though most TELs apply to spending–of the 18 TELs examined here, only 5 apply directly to taxes or revenue–an effective TEL should slow the growth of state taxes as well. The average growth rate of per capita state taxes in TEL states changed in the following ways after TEL enactment.

The five-year growth rate of per capita state taxes in TEL states fell from 5.5 percentage points above the non-TEL-state average before TEL enactment to 12.5 percentage points below the non-TEL-state average after TEL enactment (Figure 4).

Figure 4
Growth Rate of per Capita State Taxes Relative to the Non-TEL State Average for the Five Years Immediately Preceding and the Five Years Immediately Following TEL Enactment

The growth rate of per capita state taxes in TEL states from the year of enactment through 1992, as opposed to just five years after enactment, fell even lower, to 13.2 percentage points below the non-TEL-state average.The five-year real growth rate of per capita state taxes in TEL states was 11.9 percent before TEL enactment. State taxes then fell by 2.8 percent over the five years after TEL enactment.

If real per capita tax growth in TEL states had not been reversed–that is, if real per capita taxes had risen 11.9 percent instead of declining 2.8 percent over the five years following TEL enactment–a family of four in one of the TEL states would have had to face, on average, a state tax burden that was $650 higher five years after TEL enactment than they faced with the lower growth rate of taxes.

As Figure 5 shows, as a result of the slower growth of state taxes, the level of taxes in TEL states fell in relation to taxes in the rest of the country after TEL enactment. Average per capita state taxes in TEL states fell from 8.8 percent above the non-TEL-state average in the year that TELs were enacted to 0.2 percent below it five years later.

Figure 5
Per Capita State Taxes Relative to the Non-TEL-State Average, Year of TEL Enactment and Five Years Later

So in each case in which the growth rates of spending and taxes in TEL states were compared to the U.S. and the non-TEL-state averages, TELs appeared to have been effective in slowing the growth of state government–although probably not as effective as their supporters had wished.

State and Local Spending

Many TEL critics claim that the real impact of TELs is not in restraining the overall tax and spending burden but in shifting it to local governments. That would presumably defeat the purpose of the TEL. While some TELs include a provision prohibiting the state government from shifting costs to local governments without providing the funding to cover those costs, most do not. Thus, some cost shifting is to be expected.

Incidentally, if the only impact of TELs were to shift government responsibility–for both financing and decision-making–to the local level, TELs might still be worthwhile. Since local politicians are closer to the people, they are more accountable and less likely to be able to get away with excessive spending. Also, moving spending to the local level more closely links the costs of public services to the beneficiaries. In fact, many studies have found that decentralized governments provide public services more efficiently than do centralized governments.[22]

Nevertheless, if the purpose of TELs is to limit the burden of government, then cost shifting may mean that those measures are less successful than their proponents intended.For example, if costs are fully shifted to local governments (i.e., local spending growth rises as much as state spending growth falls), then the total state and local tax burden in TEL states will not have fallen. And if that were the case, though state spending growth would have fallen, it would be misleading to conclude that the burden of government had been reduced.

One way to check for such cost shifting is to substitute per capita state and local spending for per capita state spending and perform the same tests that were used earlier. If a decline in state spending growth leads to a proportional rise in local spending growth, then combined state and local spending growth should not decline. Indeed, both the growth and the level of state and local spending in TEL states did decline, relative to those of the rest of the nation, though not as dramatically as state-level spending.

The five-year growth rate of per capita state and local spending in TEL states fell from 2.3 percentage points above the U.S. average before TEL enactment to 1.2 percentage points below the U.S. average after TEL enactment (Figure 6).

Figure 6
Growth Rate of per Captia State and Local Spending Relative to U.S. Average for the Five Years Immediately Preceeding and the Five Years Immediately Following TEL Enactment

The growth rate of per capita state and local spending in TEL states from the year of enactment through 1991, as opposed to just five years after enactment, fell even lower, to 10.2 percentage points below the U.S. average.[23]The five-year real growth rate of per capita state and local spending in TEL states fell from 6.1 percent before TEL enactment to 2.4 percent after TEL enactment.

Figure 7 shows that, like the growth rate, the level of state and local spending in TEL states fell (relative to the rest of the nation) after TEL enactment. Average per capita state and local spending in TEL states fell from 0.1 percent below the U.S. average in the year that TELs were enacted to 4.4 percent below it in 1991. Thus, in addition to the burden of state government’s falling after TEL enactment, the overall burden of state and local government fell.

Figure 7
Per Capita State and Local Spending Relative to U.S. Average, Year of Enactment and 1991

The data suggest that, as expected, some cost shifting to local governments has, indeed, occurred. However, the data also show that in addition to restraining the growth of state government, as indicated earlier, TELs have been effective at restraining the growth of the overall burden of state and local government.

TELs: Why Some Succeed and Others Fail

Some TELs are more effective than others in restraining the growth rate of taxes and spending. In fact, some of the TELs included in this analysis were conclusively ineffective–most notably, those of Louisiana, Montana, and South Carolina (see Table A.2). The reasons some TELs succeed and others fail can be found in their design.

There are several criteria on which TELs may vary that can play a role in their ultimate effectiveness.[24] (Table 2 examines each of the 18 binding TELs included in this study on five of those factors.) The major issues in determining the effectiveness of TELs are discussed in the following subsections.

Table 2: Description of Binding Tax and Expenditure Limitations

State Year Constitutional/
Statutory
Initated by Approved by Limit Applies to
Arizona* 1978 Constitutional Legislature Voters Appropriations of state tax revenues
California 1979 Constitutional Voters Voters Appropriations of state tax revenues
Colorado* 1977 Statutory Legislature Legislature State general fund appropriations
Delaware 1980 Constitutional Legislature Legislature State general fund appropriations
Hawaii 1978 Constitutional Constituional Convention Voters State general fund appropriations
Idaho 1980 Statutory Legislature Legislature State general fund appropriations
Louisiana* 1979 Statutory Legislature Legislature State tax revenue
Massachusetts 1986 Statutory Voters Voters State revenue
Michigan 1978 Constitutional Voters Voters State revenue
Missouri 1980 Constitutional Voters Voters State revenue
Montana 1981 Statutory Legislature Legislature State appropriations
Oklahoma* 1985 Constitutional Legislature Voters State appropriations
Oregon 1979 Statutory Legislature Legislature State general fund appropriatioins
South Carolina 1980 Constitutional Legislature Legislature State appropriations
Tennessee 1978 Constitutional Constitutional Convention Voters Appropriations of state tax revenues
Texas 1978 Constitutional Legislature Voters Appropriations of state tax revenues
Utah 1979 Statutory Legislature Legislature State appropriations
Washington* 1979 Statutory Voters Voters State tax revenues
Source: Advisory Commission on Intergovernmental Relations, Significant Features of Fiscal Federalism, 1993, vol. 1, pp. 14-19 (and other years); Kenyon and Benker, p. 437.*These states have passed new measures or altered existing ones since 1990.
State Limit is Provisions for a Waiver
Arizona* Shall not exceed 7 percent of state personal income 2/3 approval of the legislature on specific additional appropriations
California Yearly growth shall not exceed the percentage increase in population and inflation Declaration of an emergency by a 2/3 vote and compensating reductions in spending over 3 following years
Colorado* Yearly growth shall not exceed 7 percent Statute may be amended by a majority vote of the legislature
Delaware Shall not exceed 98 percent of estimated general fund revenue and prior year’s unencumbered funds Declaration of an emergency and 3/5 vote of the legislature
Hawaii Yearly growth shall not exceed the average annual growth rate of state personal income over the preceding 3 calendar years 2/3 approval of the legislature on specific additional appropriations
Idaho Shall not exceed 5.33 percent of state personal income. 2/3 approval of the legislature on specific additional appropriations.
Louisiana* Shall not exceed FY 1978-79 state revenue as a share of 1997 state personal income, multiplied by state personal income in the prior calendar year Statute may be amended by a majority vote of the legislature; certain tax sources (i.e, severance tax revenue) are excluded from computation.
Massachusetts Yearly growth shall not exceed the average annual growth of wages and salaries over the previous 3 years. Statute may be amended by a majority vote of the legislature.
Michigan Shall not exceed FY 1978-79 state revenue of a share of 1977 state personal income in the prior calendar year or average state personal income over the previous 3 calendar years. Declaration of an emergency by governor and 2/3 vote of the legislature.
Missouri Shall not exceed FY1980-81 state revenue as a share of 1979 state personal income in the prior calendar year or average state personal income over the previous 3 calendar years. Declaration of an emergency by governor and 2/3 vote of the legislature.
Montana Biennial growth shall not exceed the percentage difference in the average state personal income over the 3 calendar years immediately preceding the biennium and the average state personal income over the 3 calendar years immediately preceding the current biennium. Declaration of an emergency by governor and 2/3 approval of the legislature on specific additional expenditures.
Oklahoma* Yearly growth shall not exceed 12 percent (adjusted for inflation) or state appropriations shall not exceed 95 percent of certified revenue. None
Oregon Biennial growth shall not exceed the growth rate of state personal income over the preceding 2 calendar years. Statute may be amended by a majority vote of the legislature.
South Carolina Yearly growth shall not exceed the average annual growth rate of state personal income over the preceding 3 calendar years, or state appropriations shall not exceed 9.5 percent of state personal income, whichever is greater. Declaration of an emergency and a 2/3 vote of the legislature;every 5 years the legislature may review the composition of the limit.
Tennessee Yearly growth shall not exceed the projected growth rate of state personal income for the calendar year in which the fiscal year begins. Majority vote of the legislature on a specific additional amount.
Texas Biennial growth shall not exceed the growth rate of state personal income. Declaration of an emergency and a majority vote of the legislature on a specific additional amount.
Utah Yearly growth may not exceed 85 percent of the increase in state personal income. Declaration of an emergency and 2/3 vote of the legislature; legislature must also hold a public hearing.
Washington* Yearly growth shall not exceed the average annual growth rate of state personal income over the preceding 3 calendar years. Declaration of an emergency by a 2/3 vote in the legislature and 2/3 approval of the legislature on specific additional appropriations.

Did the TEL Originate with the Voters or in the Legislature?

Where a TEL originates and who approves it differ from state to state. Whether a TEL originates with the voters or in the legislature can make a significant difference in its ultimate effectiveness. TELs that originate in the legislature, since they are written by politicians–the very people whose behavior they are intended to restrain–tend to be more vague, less restrictive, and more easily circumvented. In contrast, those originating with the voters usually have more teeth. Of the 18 TELs examined, 11 originated with the legislature and only 5 with the voters. The other two were initiated by constitutional convention. (See Table 2 for astate-by-state listing of who originated and who approved the 18 TELs examined herein.)

It should be noted here, however, that in 24 states citizens have no means by which to put an initiative or referendum on the ballot.[25] Such measures must be initiated by the legislature. Thus in those states, TELs that originate with the voters are not an option, although through alegislative referendum voters can at least have the opportunity to vote on a legislature-originated TEL. (Of some hope for those in noninitiative and referendum states is that, in the three states where TELs were initiated by the legislature but approved by the voters, spending growth did fall somewhat relative to the U.S. average.) Although severely handicapped, tax activists in noninitiative states can pressure their legislators to come up with a sound, well-designed TEL, in addition to pressing for a constitutional change granting citizens the right to put initiatives and referendums on the ballot.[26]

Finally, who approves the TEL is also important. Of the 18 TELs examined, 8 were approved by the legislature and 10 by the voters. Thus, while 3 of the 11 legislature-originated TELs were sent to the voters for approval, 8 never faced voter scrutiny, since they both originated in and were approved by the legislature. Only five TELs were both initiated and approved by the voters.

The same methodology used in the earlier sections reveals that in the five states where TELs were initiated and approved by the voters, spending growth slowed, relative to the U.S. average, while in the eight states where they were both initiated and approved by the legislature, spending growth actually rose, relative to the U.S. average. (The remaining five TELs were not initiated and approved by the same people but by some combination of groups including the voters, the legislature, and constitutional conventions.)

The five-year growth rate of per capita state spending in voter-initiated and voter-approved TEL states fell from 6.5 percentage points above the U.S. average before TEL enactment to 2.2 percentage points above the U.S. average after TEL enactment, a fall of 4.3 percentage points. In contrast, the five-year growth rate of spending in states where TELs were both initiated and approved by the legislature rose from 2.1 percentage points below the U.S. average before TEL enactment to 0.5 percentage points below the U.S. average after TEL enactment, an increase of 1.6 percentage points. These findings support Poulson’s theory that TELs initiated by the legislature “could actually erode the budget constraint resulting in an increase in the growth of state government.”[27]

The ideal TEL would originate with and be approved by the voters, where possible, rather than the legislature.

Is the TEL Constitutional or Statutory?

In addition to origin and approval, whether a TEL is statutory or constitutional is important. Constitutional TELs are difficult to change. On the other hand, statutory TELs leave open the possibility that the legislature will change the definition of the item limited–often by excluding certain areas of spending or revenue–or weaken the restrictiveness of the limit itself whenever legislators see fit. Thus, constitutional TELs are thought to be more effective than statutory TELs. Of the 18 TELs examined herein, 10 are constitutional and 8 are statutory. (See Table 2 for a state-by-state list.)

Again, the same methodology gives results that indicate that spending growth in the 10 constitutional-TEL states fell, relative to the U.S. average, more so than in the 8 statutory-TEL states.

The five-year growth rate of per capita state spending in constitutional-TEL states fell from 0.8 percentage points below the U.S. average before TEL enactment to 5.6 percentage points below the U.S. average after TEL enactment, a fall of 4.8 percentage points. In contrast, the five-year growth rate of spending in statutory-TEL states fell from 2.9 percentage points above the U.S. average before TEL enactment to 0.6 percentage points above the U.S. average after TEL enactment, a fall of only 2.3 percentage points.

The ideal TEL would be constitutional rather than statutory.

How Much of the Budget Is Being Limited?

Even the most stringent TELs do not pertain to the entire budget. Most apply solely to the general fund. Since, on average, about 44 percent of state-appropriated funds are outside the general fund, a substantial portion of the budget is left uncapped.[28] In fact, in some states the uncapped portion of the budget can be as large as 71 percent.[29] Often exempted are expenditures of special funds such as those earmarked for highways, education, and capital construction. Among the frequently exempted revenue items are federal aid, insurance trust funds, user fees, and earmarked funds.

Six of the 18 TELs examined here apply to state tax revenue.[30] Thus, those TELs do nothing to restrict the growth of nontax revenue–charges, user fees, and the like. Predictably, from 1980 to 1991, charges and miscellaneous general revenue rose as a share of total general revenue from 13.8 percent to 17.7 percent.[31]

The ideal TEL would apply a cap to 100 percent of the budget rather than to only certain categories.

Does the TEL Cap Spending or Revenue?

Whether a TEL applies to spending or revenue can also make a difference in its effectiveness. Of the 18 TELs examined here, 9 apply to spending (4 to appropriations and 5 to general-fund appropriations), and 9 apply to revenue in one way or another (3 to revenue, 2 to tax revenue, and 4 to appropriations of tax revenue).

Each fiscal year, states must estimate their revenues for the coming year, in part on the basis of forecasts of how the state’s economy will perform. Those economic forecasts, and hence the revenue estimates, are often quite inaccurate. Further, politicians can manipulate the economic forecasts in an effort to get around their TELs’ restrictions. Therefore, the use of revenue estimates as the base for a TEL is not ideal.

Those pitfalls can largely be avoided, however, by applying the TEL to spending, since the spending numbers for the coming fiscal year are far more certain.

The ideal TEL would cap spending rather than revenue or taxes.

What Is the Limit?

Another important factor is the definition of the limit itself. Most TELs–including 14 of the 18 TELs examined here–restrict state spending growth to the growth in state personal income. A few, however, use other limits such as population growth, inflation, or a fixed rate of growth. (See Table 2 for more details.)

Many argue that, of the wide variety of limits in use, those that restrict the growth of government to the rate of growth of personal income are the most appropriate since they prohibit the government from growing faster than the private economy. The fact that an overwhelming majority of TELs are so structured highlights the degree to which this argument has been accepted.

However, the evidence suggests that linking spending to population growth plus inflation is much more restrictive. To illustrate the different effects of those two types of limits–personal income linked versus population linked–Figure 8 shows the record of the 1980s. Throughout most of the 1980s the economy was booming, thus personal income rose at abnormally high rates, 30 percent in real terms from 1980 to 1990. In those prosperous times, government revenues were pouring in, allowing spending to skyrocket as well. Real state spending shot up by 42 percent from 1980 to 1990. Meanwhile, the U.S. population grew at only a modest rate of 10 percent.[32]

Figure 8
Growth in Population, Real Personal Income, and Real State Spending, 1980-90

Thus, a TEL limiting spending growth to the growth rate of personal income would have resulted in a slower rate of state spending growth over the last decade than occurred (30 percent compared to 42 percent). However, a TEL limiting the growth of state spending to the growth rate of population plus inflation would have provided a far stricter limit on real state spending growth, holding it to only 10 percent from 1980 to 1990, less than one-fourth the 42 percent rate at which it actually grew and one-third the rate at which a personal income-linked TEL would have allowed spending to grow. Thus, TELs limiting spending growth to the growth rate of population plus inflation are far preferable if the goal is to tame spending.

In fact, one of the reasons many studies have found TELs ineffective is that so many TELs are linked to personal income growth–which is hardly a restrictive limit. Since most TELs were in place by 1982, the evidence on spending growth since TEL enactment comes largely from the period of the 1980s when rapid growth of income accommodated the surge in spending.

For example, South Carolina has a personal income-linked TEL. The five-year growth rate of spending in South Carolina rose from 18.7 percentage points below the U.S. average before TEL enactment to 3.0 percentage points above the U.S. average after TEL enactment. By contrast, thefive-year growth rate of spending in California, which has a population- and inflation-linked TEL, fell from 9.4 percentage points above the U.S. average before TEL enactment to 5.9 percentage points below the U.S. average after TEL enactment.

The ideal TEL would limit the growth of spending to the growth rate of the population plus inflation rather than to the growth of personal income.

Can the TEL’s Restrictions Be Circumvented?

How easily politicians can get around the limits of a TEL is an important factor in determining how successful that TEL will be at restraining the growth of government. At the very least, the TEL should be binding. In two cases the limit applies only to the governor’s recommended budget and thus has virtually no teeth. (Nevada and Rhode Island have such nonbinding TELs, so as mentioned earlier, they were not included as TEL states in this study.)

Of the other TELs, only Oklahoma’s does not provide some mechanism by which the legislature can waive the restrictions of the TEL. Nine of the 18 TELs examined here first require the declaration of an “emergency.” However, no state has specified what constitutes an emergency.[33] Of the 18, 6 require only a majority vote to waive their TELs; 1 requires three-fifths approval; 9 require two-thirds approval; 1 requires two-thirds approval plus compensatingreductions over the following three years; and 1 has no waiver provisions. (See Table 2 for more details.)

The ideal TEL would require voter approval for its provisions to be circumvented.

Does the TEL Allow Cost Shifting to Local Governments?

Since the goal of a TEL is to restrict the growth of government, if state governments adhere to their TELs by shifting costs to local governments, the overall size of government will not have been restrained. In an effort to foil such attempts to ignore the true intent of TELs, 5 ofthe 18 TEL states examined here have adopted TELs that prohibit state governments from imposing unfunded mandates on local governments.[34]

Since localized government is preferable to centralized government, a prohibition of unfunded mandates, which by itself could prohibit such decentralization, may not be desirable. To address that, four of the five TELs that prohibit unfunded mandates do allow for transfer of responsibility–for both program financing and decisionmaking–to local governments. In those cases, the state spending limit is then adjusted downward.

Since most TELs do not apply to local governments, such decentralization could, through a disproportionate expansion in local government spending, lead to an increase in the overall level of state and local government spending. To prevent such expansion, TELs should apply to local governments as well.

Colorado’s Taxpayer Bill of Rights, passed in 1992, is a recent example of a TEL that applies to both state and local governments. Several of the prospective 1994 ballot measures do so as well.

The ideal TEL would apply to both state and local governments. And it would allow for transfer of responsibility to local governments and provide for the appropriate adjustments in each jurisdiction’s limit.

Does the TEL Require Additional Action to Be Implemented?

The manner in which a TEL is to be implemented is also of considerable importance. If the legislature must take additional action to make the TEL operative, it can create a major roadblock in the path toward fiscal restraint. Unfortunately, in several instances that has been the case.

For example, in Connecticut, as part of the 1991 deal to enact a new state income tax, Gov. Lowell Weicker agreed to a statutory TEL limiting the growth in general budget expenditures to the percentage increase in personal income or inflation (whichever was higher). A similar measure was passed as a constitutional amendment in 1992. However, the measure required that the general assembly define “general budget expenditures,” “increase in personal income,” and “increase in inflation.” The legislature has thus far refused to define those terms, and the state’s attorney general has ruled that until they do, the TEL is inoperative. Therefore, because of poorly designed implementation provisions, a TEL that voters approved by a four-to-one margin remains impotent.[35]

The ideal TEL would require no additional action by the legislature for implementation.

How Is the TEL Enforced?

Finally, enforceability plays a major role in determining the effectiveness of fiscal discipline mechanisms. If a TEL is not adhered to, it ceases to be useful. Thus, a TEL should clearly articulate what is to take place should the government violate the dictates of the TEL. Unfortunately, that is rarely the case. As a result, several states have simply ignored their TELs.

A case in point is Texas, where a constitutional TEL was passed by an overwhelming 84 percent majority in 1978. The TEL was adhered to in the first biennium to which it applied, but it has been ignored ever since.[36] While the Texas constitution is fairly clear on the precise course to be taken in the case of a violation of budgetary laws such as this one, the specific wording of the TEL itself does not mention enforcement mechanisms. In part as a result of that, the Texas Public Policy Foundation reports that “the Texas Reform Act is probably being violated at almost every level of the budget process,” leading the legislature’s biennial appropriations to exceed their limit by as much as $1.5 billion.[37]

To avoid that sort of enforceability problem, the text of a TEL should clearly state that taxpayers have legal standing to sue to enforce the TEL’s provisions.[38] In addition, TELs should require injunctive relief to prevent the illegal collection of taxes or appropriation of expenditures while suit is pending. Missouri’s Hancock II, an initiative seeking 1994 ballot status, is an example of a TEL that contains such provisions.[39]

The ideal TEL should give taxpayers standing to sue to enforce its provisions and require injunctive relief to prohibit any illegal taxes or spending while such suits are pending.

The Ideal TEL

The ideal TEL should have the following characteristics.[40]

  1. It should originate with and be approved by the voters, where possible, rather than the legislature.
  2. It should be constitutional rather than statutory.
  3. It should apply a cap to 100 percent of the budget rather than to only certain categories.
  4. It should cap spending rather than revenue or taxes.
  5. It should limit the growth of spending to the growth rate of population plus inflation rather than to the growth of personal income.
  6. It should require voter approval for its provisions to be circumvented.
  7. It should apply to both state and local governments. And it should allow for transfer of responsibility to local governments and provide for the appropriate adjustments in each jurisdiction’s limit.
  8. It should not require additional action by the legislature for implementation.
  9. It should give taxpayers standing to sue to enforce its provisions and require injunctive relief to prohibit any illegal taxes or spending while suit is pending.

Do TELs Have a Useful Life Span?

It is often argued that TELs are less effective over the long run than they are when first implemented. Part of the reason for that is that many TELs are statutory and can be amended by the legislature at any time. Thus, since TELs are often weakened over time–through exclusions of additional areas of spending or revenue to which the limit applies or through outright alterations of the limit itself–it is expected that their effectiveness will decline as well.

Examination of the 15 binding TELs in place by 1980 indicates that spending growth is indeed restrained more over the first five years after TEL enactment than over the second five years.[41] The real growth rate of per capita state spending in the 15 states with binding TELs in place by 1980 was 3.5 percentage points below the U.S. average from 1980 to 1985 (6.3 percent vs. 9.8 percent) but 0.4 percentage points above the U.S. average from 1985 to 1990 (16.7 percent vs. 16.3 percent).

California–where a constitutional TEL was enacted in 1979–is one example of a state whose TEL has substantially lost effectiveness over time, as more and more spending has been moved outside the purview of the limit. For example, Proposition 98, passed in 1988, required that a large portion of the state budget go to education, in effect crowding out spending on other things such as streets, highways, sewers, and police protection. The resulting demands for more spending on those areas were then often met with specific earmarked local taxes, thus increasing the overall burden of state and local government. Further, Proposition 99 increased the cigarette tax but excluded that revenue from the general fund, designating it instead for grants to health organizations, thus exempting it from the TEL’s cap.[42] As a result, despite the presence of a constitutional TEL, state spending in California continued to rise dramatically throughout the 1980s.

The erosion of TEL effectiveness over time can be linked in part to the culture of spending in state capitals, in which politicians will do whatever it takes to avoid having their spending powers restrained. However, it can also be traced to poor design. A major loophole in every existing TEL is the lack of a cap applying to the entire budget.

For instance, California’s TEL applied only to “appropriations of state tax revenue.” Others apply only to “state general fund appropriations.” As a result, government can be and has been expanded in such states, despite the presence of a TEL, by increasing nontax revenue (e.g., charges and user fees) and excluding certain categories of spending from the general fund. That loophole is probably the single biggest contributor to the limited effectiveness of TELs, especially over time.

Perhaps the most important factor in preventing the erosion of the effectiveness of a TEL is making sure that the language of the TEL clearly states that the cap applies to “100 percent of state expenditures.” Inclusion of that language and the other characteristics of the ideal TEL outlined in the preceding section would go a long way toward ensuring that TELs do indeed have a long useful life span.

Other Measures of Fiscal Restraint

Well-designed TELs can impose significant fiscal restraint on a state’s budgetary process. However, other useful measures exist as well. Two such measures are super-majority requirements and voter approval requirements for increasing existing taxes or imposing new taxes. Table 3 is a list of the states that have at least one of those three (including TELs) measures of fiscal restraint.

Table 3: Fiscal Discipline Mechanisms in the States
State
Tax & Expenditure Limit
Supermajority Requirement
Voter Approval Requirement
Alaska
X
Arizona
X
X
Arkansas
X
California
X
X
Colorado
X
X
Connecticut
X
Delaware
X
X
Florida
X
*
Hawaii
X
Idaho
X
Louisiana
X
X
Massachusetts
X
Michigan
X
Mississippi
X
Missouri
X,*
*
Montana
X
*
*
Nevada
X
*
North Carolina
X
North Dakota
*
Oklahoma
X
X
X
Oregon
X
*
Rhode Island
X
South Carolina
X
South Dakota
X
Tennessee
X
Texas
X
Utah
X
Washington**
X
X
Total in 1994
23
9
3
1994 ballot measures
1
2
5
Note: The following states have none of these three fiscal discipline mechanisms currently in place or on the ballot in 1994: Alabama, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Minnesota, Nebraska, New Hampshire, New Jersey, New Mexico, New York, Ohio, Pennsylvania, Vermont, Virginia, West Virginia, Wisconsin, Wyoming.

* Measures seeking 1994 ballot status (source: Americans for Tax Reform)

**Washington State’s Initiative 601, passed in 1993, requires voter approval for tax increases that cause spending to exceed the spending limit (population growth plus inflation) but not for all tax hikes.

Supermajority Requirements for New or Increased Taxes

By requiring more than a simple majority (usually a two-thirds majority) to raise existing taxes or impose new ones, supermajority requirements force legislators to reach a broader consensus on the necessity for higher taxes and the wisdom of the spending those taxes will fund.[43] A more sound fiscal policy is the likely result. Nine states have such requirements, two of which were enacted in 1992. In 1994 voters in two states–Montana and Nevada–may have the opportunity to pull the lever in support of supermajority requirements.[44]

Voter Approval Requirements for New or Increased Taxes

Another fairly new fiscal discipline measure requires voter approval to increase existing taxes or impose new ones. In March 1992 Oklahoma kicked off this popular and populist movement by passing a constitutional amendment that requires voter approval of any tax hike that does not pass each house of the legislature by at least a three-fourths vote. Colorado went even further in November 1992 with passage of the Taxpayer Bill of Rights, a constitutional amendment that requires voter approval of any increase in state or local taxes. In 1994 there may be as many as five state ballot initiatives that would require voter approval for new or increased taxes.[45]

Voter approval requirements (VARs) have the further appeal of reconnecting the voters with their governments. Politicians who wish to raise taxes now have to convince only their fellow legislators of the wisdom of such a move. With a VAR, however, would-be tax-hiking politicians would have to take their case to the people. They would be forced to convincingly explain to their constituents why the money is needed and where it will be spent. That is rarely easy.

Of course, VARs are not without their weaknesses. For example, since most VARs merely restrict the growth of tax rates, they would do nothing to prohibit the growth of nontax revenue.[46] As mentioned earlier, charges, fees, and miscellaneous general revenues have been growing as a share of total general revenue. Thus, the restrictions of most VARs could be circumvented by continuing to increase those types of revenues.

Still, measures that require voter approval for increasing existing taxes or imposing new ones provide a powerful method to restrain the growth of state government. Further, VARs are very popular with voters. A recent national poll found that 66 percent of Americans favor requiring tax increases to be approved by a majority vote of the people.[47] The popular appeal of VARs makes it probable that they will follow the path of the term-limits movement. That is, they will most likely pass by wide margins everywhere they are on the ballot in 1994 and be adopted by many more states in the years to come.

Conclusion

TELs, as we know them, are no silver bullet. Even their staunchest supporters will admit that TELs have not slowed the growth of taxes and spending as much as their advocates would have liked. Some TELs, in fact, have been clearly ineffective. However, the ineffective TELs tend tobe the ones that are plagued by specific elements of poor design. For example, they are usually statutory rather than constitutional and thus are designed by the very politicians whose behavior they are intended to restrain. As a result, the cap frequently excludes large areas of the budget, and the TEL is often written in a manner that makes circumventing or even changing its limit quite easy.

Nevertheless, as this study has shown, TELS–despite their substantial flaws–can work. They can slow the rate of growth of taxes and spending, relative to the rest of the nation, and they can do so without shifting massive costs to local governments. In addition, though all existing TELs have notable flaws that limit their effectiveness, the better designed TELs are much more effective than are those that are designed poorly. Furthermore, TELs with the features of the ideal TEL described herein would have an even greater impact.

This fall voters in as many as six states will have the opportunity to pass some type of tax limitation measure. People opposed to TELs–career politicians, lobbyists, and others–will go to great lengths to scare voters into thinking TELs are damaging. The evidence presented here suggests just the opposite. By restraining the ability of politicians to continue to allow taxes and spending to grow unchecked, TELs can finally provide the beleaguered taxpayer some much-needed relief from the crushing burden of state taxes.

Appendix: Detailed Tables
The tables in this appendix provide more detailed information on TELs. Tables A.3 through A.6 give the results of four different measures of changes in taxing and spending.

Table A.1:
Tax Initiatives Seeking Ballot Status in 1994
State
Initiative
Florida Voter approval requirement
Missouri Tax/expenditure limitation and voter approval requirement
Montana Voter approval requirement
Supermajority requirement
Nevada* Supermajority requirement**
North Dakota Voter approval requirement
Oregon Voter approval requirement**
Source: Americans for Tax Reform.

Note: Information is correct as of July 11, 1994.

*State law in Nevada requires that all ballot measures be approved in two consecutive general elections before taking effect. This measure will be seeking its first such approval.

**On ballot.

Table A.2
Per Capita State Government Spending and Five-Year Growth Rates Relative to U.S. Average, before and after TEL Enactment
Per Capita Spending
Five-Year Growth Rate
Change in Five-Year Growth Rate Relative to U.S. Average
5 Years before TEL
Year of TEL
5 Years after TEL
5 Years Preceding TEL
% Points above/below U.S. Average
5 Years Following Enactment
% Points above/below U.S. Average
1972 1977 1982 1972-77 1972-77 1977-82 1977-82
Colorado
$481
$748
$1,113
+55.5%
-6.3 %
+48.8%
-6.1%
+0.1%
U.S. avg.
$476
$770
$1,193
+61.8%
+54.9%
1973 1978 1983 1973-78 1973-78 1978-83 1978-83
Arizona
$500
$811
$1,085
+62.2%
+2.2%
+33.8%
-13.9%
-16.1%
Hawaii
$1,075
$1,520
$1,932
+41.4%
-18.6%
+27.1%
-20.5%
-2.0%
Michigan
$571
$910
$1,340
+59.4%
-0.6%
+47.3%
-0.4%
+0.2%
Tennessee
$386
$653
$867
+69.2%
+69.2%
+9.2%
+32.8%
-14.9%
Texas
$364
$620
$898
+70.
+10.4%
+44.8%
-2.8%
-13.2%
U.S. avg
$517
$827
$1,221
+60.0%
47.6%
1974 1979 1984 1974-79 1974-79 1979-84 1979-84
California
$655
$1,114
$1,537
+70.1%
+9.4%
+38.0%
-5.9%
-15.3%
Louisiana
$594
$939
$1,504
+58.1%
-2.6%
+60.2%
+16.3%
+18.8%
Oregon
$573
$996
$1,388
+73.8%
+13.2%
+39.4%
-4.5%
-17.7%
Utah
$580
$974
$1,350
+67.9%
+7.3%
+38.6%
-5.3%
-12.6%
Washington
$642
$1,064
$1,525
+65.7%
+5.1%
+43.3%
-0.5%
-5.6%
U.S. avg.
$569
$914
$1,315
+60.6%
+43.9%
1975 1980 1985 1975-80 1975-80 1980-85 1980-85
Delaware
$889
$1,378
$2,011
+55.0%
-0.1%
+45.9%
+2.5%
+2.6%
Idaho
$654
$971
$1,250
+48.5%
-6.7%
+28.7%
-14.7%
-8.1%
Missouri
$466
$736
$1,082
+57.9%
+2.8%
+47.0%
+3.5%
+0.8%
South Carolina
$658
$898
$1,315
+36.5%
-18.7%
+46.4%
+3.0%
+21.6%
U.S. avg.
$651
$1,010
$1,449
+55.1%
+43.5%
1976 1981 1986 1976-81 1976-81 1981-86 1981-86
Montana
$770
$1,181
$1,705
+53.4%
-3.0%
+44.4%
+4.9%
+8.0%
U.S. avg
$718
$1,123
$$1,566
+56.4%
+39.4%
1980 1985 1990 1980-85 1980-85 1985-90 1985-90
Oklahoma
$948
$1,323
$1,784
+39.6%
-3.9%
+34.8%
-6.4%
-2.5%
U.S. avg.
$1,010
$1,449
$2,047
+43.5%
+41.3%
1981 1986 1991 1981-86 1981-86 1986-91 1986-91
Massachusetts
$1,265
$1,963
$3,046
+55.2%
+15.7%
+55.2%
+14.4%
-1.3%
U.S. avg.
$1,123
$1,566
$2,204
+39.4%
+40.7%
18-state avg.
+0.8%
-2.9%
-3.7%
Note: Spending is per capita state “total general expenditure.” The “% points above/below” and the “change” numbers were calculated using unrounded values for the various growth rates.
Table A.3
Growth Rates of Taxes and Spending for the Five Years Immediately Preceding and the Five Years Immediately Following TEL Enactment
Preceeding Enactment
Following Enactment
Change
Real Five-Year Change
Per capita state spending
7.1%
1.8%
-5.3% pts
Per capita state taxes
11.9%
-2.8%
-14.6% pts
Per capita state and local spending
6.1%
2.4%
-3.7% pts
Five-Year Change Relative to Change in U.S. Average
Per capita state spending
+0.8% pts
-2.9% pts
-3.7% pts
Per capita state taxes
+4.0% pts
-8.1% pts
-12.1% pts
Per capita state and local spending
+2.3% pts
-1.2% pts
-3.5% pts
Five-Year Change Relative to Change in Non-TEL Average
Per capita state spending
-1.5% pts
-4.6% pts
-3.1% pts
Per capita state taxes
+5.5% pts
-12.5% pts
-18.0% pts
Per capita state and local spending
-1.8% pts
-3.5% pts
-1.7% pts
Note: All figures refer to the average for the 18 states with binding TELs examined herein. The “change” numbers were calculated using unrounded values for the various growth rates and levels of taxes and spending.
Table A.4
Growth Rates of Taxes and Spending for the Five Years Immediately Preceding and the Years Since TEL Enactment
5 Years preceding Enactment
Since Enactment
Change
Change Relative to Change in U.S. Average
Per capita state spending
+0.8% pts
-12.1% pts
-12.9% pts
Per capita state taxes
+4.0% pts
-7.8% pts
-11.8% pts
Per capita state and local spending
+2.3% pts
-10.2% pts
-12.5% pts
Change Relative to Change in Non-TEL Average
Per capita state spending
-1.5% pts
-13.9% pts
-12.4% pts
Per capita state taxes
+5.5% pts
-13.2% pts
-18.7% pts
Per capita state and local spending
-1.8% pts
-11.3% pts
-9.5% pts
Note: All figures refer to the average for the 18 states with binding TELs examined herein. The “change” numbers were calculated using unrounded values for the various growth rates and levels of taxes and spending.
*Most recent state spending and tax figures are for 1992. State and local spending figures for 1992 are not yet available, so 1991 numbers were used.
Table A.5
Levels of Taxes and Spending in the Year of TEL Enactment and Five Years Later
Year of Enactment
5 Years after Enactment
Change
Percent above/below U.S. Average
Per capita state spending
+6.4% pts
+4.2% pts
-2.3% pts
Per capita state taxes
+3.9% pts
-1.8% pts
-5.8% pts
Per capita state and local spending
-0.1% pts
-1.0% pts
-1.0% pts
Percent above/below Non-TEL Average
Per capita state spending
+4.7% pts
+1.3% pts
-3.4% pts
Per capita state taxes
+8.8% pts
-0.2% pts
-8.9% pts
Per capita state and local spending
+3.2% pts
+0.5% pts
-2.6% pts
Note: All figures refer to the average for the 18 states with binding TELs examined herein. The “change” numbers were calculated using unrounded values for the various growth rates and levels of taxes and spending.
Table A.6
Levels of Taxes and Spending in the Year of TEL Enactment and the Most Recent Year
Year of Enactment
Most Recent Year
Change
Percent above/below U.S. Average
Per capita state spending
+6.4% pts
+1.7% pts
-4.7% pts
Per capita state taxes
+3.9% pts
+0.7% pts
-3.2% pts
Per capita state and local spending
-0.1% pts
-4.4% pts
-4.3% pts
Percent above/below Non-TEL Average
Per capita state spending
+4.7% pts
-0.6% pts
-5.3% pts
Per capita state taxes
+8.8% pts
+3.0% pts
-5.8% pts
Per capita state and local spending
+3.2% pts
-1.7% pts
-4.8% pts
Note: All figures refer to the average for the 18 states with binding TELs examined herein. The “change” numbers were calculated using unrounded values for the various growth rates and levels of taxes and spending.
*Most recent state spending and tax figures are for 1992. State and local spending figures for 1992 are not yet available, so 1991 numbers were used.

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