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Issue Brief


Election 2009 Results: How Taxpayers Fared at the Ballot Box
NTU Issue Brief #174

November 13, 2009

Introduction

With a limited number of states holding elections for public office in 2009, voters in many parts of the country focused on ballot measures instead. In order to better inform taxpayers of how these efforts would affect their wallets, NTU published General Election Ballot Guide 2009, The Taxpayers Perspective last month, which described ballot measures in twelve states and their likely effect on the size and cost of government. Now that the votes have been tallied, we look back on the results to see how taxpayers fared.

Despite a wave of protests and activism opposing bigger government, the results of the vote on November 3rd proved only somewhat indicative of this rising tide. There were several ballot contests where Americans rejected higher taxes and more government regulation, while many others approved higher taxes and larger government.

Out of the 44 state and local ballot questions identified by NTU's Ballot Guide 2009, measures that could lower taxes or control government passed 70 percent of the time (for a total of 7 proposals passed). On the other hand, measures that could raise taxes or expand government were also approved at a high margin, of 76 percent (for a total of 26 proposals passed).

Table 1. Results from State Ballot Questions Highlighted in NTU's Ballot Guide 2009

 

Total Number

Number Approved

Number Rejected

Measures that would lower taxes/limit government

10

7

3

Measures that would raise taxes/expand government

34

26

8

This Issue Brief further explores taxpayer victories and losses in the 2009 election season in the areas of taxes, bond spending, property rights and government reform in several states and localities across the United States. Unfortunately, most of these tax increase proposals passed while two golden opportunities to place reasonable limits on the growth of government failed.

Taxes

Table 2. Tax Measures

State

Number

Subject

NTU Guide

Result

AL

n/a

one-mill county property tax increase

Approved

CA

n/a

expand local telephone tax

Approved

CT

n/a

one-mill increase in local property tax

Approved

ME

2

cut excise tax on vehicles

+

Rejected

ME

4

institute a "Taxpayer Bill of Rights"

+

Rejected

MO

n/a

extend local "COMBAT" drug enforcement tax

Approved

MO

n/a

sales tax increase in fire protection district

Approved

MO

n/a

county property tax increase

Rejected

MO

n/a

county gas tax increase

Rejected

MO

n/a

1/8 percent local sales tax increase

Approved

MO

n/a

3/4 percent local sales tax increase

Approved

OH

3

casino gross revenue tax

Approved

PA

n/a

local tax increase on assessed property

Rejected

WA

1033

limits on revenue raised by government

+

Rejected

Note: A "+" sign indicates a measure to limit government and a "–" sign indicates a measure to expand government, as reported in NTU's Ballot Guide 2009.

In Maine, voters rejected a state-of-the-art tax and expenditure limit that would have prevented government from growing at an unsustainable rate. Known as the Taxpayer Bill of Rights (TABOR), Question 4 on the state ballot would have held the growth of spending to the annual change in inflation and population, established a rainy day fund and returned excess dollars to taxpayers, and required voter approval for higher taxes. Facing a steep funding disadvantage, the measure failed amidst a barrage of negative advertising to undermine it. Taxpayers in Maine also voted down a measure to cut the municipal excise tax on newer vehicles and exempt hybrids and other high-efficiency vehicles from sales tax for three years.

Washington rejected a similar statewide measure, Initiative 1033, that would have established a limit on revenue raised by the government based on annual growth in inflation and population. Had this passed, any revenues above that limit would have provided relief for property taxes. This would have prevented government from growing at an unmanageable rate and would have protected taxpayers from the endless cycles of budget deficits and higher taxes.

Taxpayers in Missouri passed several local proposals to raise taxes to fund infrastructure projects and close city budget gaps. While seemingly minor, these taxes will raise a significant amount of revenue for each county. Though it does not expire until next year, Jackson County chose to extend the "COMBAT Tax" intended to pay for anti-drug efforts in the area. Residents of the Central Jackson County Fire Protection District approved a $2 million tax increase in the form of a half-cent sales tax hike. On a brighter note, residents of Peculiar rejected two tax hike proposals: a property tax increase of 20 cents per $100 valuation and a gas tax increase of one cent per gallon. They were intended to fund city sewer maintenance and road improvements respectively. Unfortunately, Clay County residents passed a measure to impose a new sales tax of 1/8 percent on items purchased in the county for the next 12 years. Lastly, Springfield residents will see a five year 3/4 percent sales tax increase to close a $200 million gap in the city's budget.

Several other local tax hike initiatives also passed. Earlier this fall, in Henry County, Alabama, voters passed a one-mill property tax increase in order to pay for several school expansion projects. Palm Springs, California expanded the city's telephone tax to include cellular phones and other technologies, such as online communications services like "Skype."

In contrast, Pennsylvanians in Pike County voted down a $1.1 million tax hike, an increase of one mill on the assessed value of a homeowner's property. This revenue was intended to close a $19,000 gap in the county library's budget.

On the statewide ballot in Ohio, voters approved a measure authorizing casinos in Cincinnati, Columbus, and Toledo. Each facility will be taxed at 33 percent of gross revenue in addition to other taxes that the facilities will pay. This means that casinos will be taxed at higher rates than other businesses throughout Ohio.

Bonds and Spending

Table 3. Bond and Spending Measures

State

Number

Subject

NTU Guide

Result

CT

n/a

bridge repair spending

Approved

CT

n/a

road repair spending

Approved

CT

n/a

construction of pump station

Approved

CT

n/a

water pollution control spending

Approved

CT

n/a

improvements on high school building

Approved

CT

n/a

energy improvement spending

Approved

CT

n/a

land preservation spending

Rejected

CT

n/a

rehabilitation project

Rejected

CT

n/a

road and sidewalk construction

Approved

CT

n/a

commercial development

Approved

CT

n/a

land acquisition

Rejected

CT

n/a

bridge construction

Rejected

CT

n/a

bikeway/walkway construction

Approved

CT

n/a

salt storage shed construction

Approved

CT

n/a

land preservation

Approved

CT

n/a

firehouse project spending

Approved

NJ

n/a

land preservation spending

Approved

OH

1

war veterans programs spending

Approved

TX

8

veterans hospitals spending

Approved

VA

n/a

school construction and renovation

Approved

Note: A "+" sign indicates a measure to limit government and a "–" sign indicates a measure to expand government, as reported in NTU's Ballot Guide 2009.

Most bond issues on state and local ballots identified in Ballot Guide 2009 passed. However, there were four measures that taxpayers rejected in Connecticut. Ellington residents voted down a borrowing request to purchase two properties on which the city would prevent development. Groton residents voted to reject the Thames Street Rehabilitation project. Finally, the people of Mansfield did not approve measures to increase borrowing for the city to purchase land and replace two bridges.

Property Rights

Table 4. Property Rights Measures

State

Number

Subject

NTU Guide

Result

TX

11

prohibit private property acquisition for public use

+

Approved

Note: A "+" sign indicates a measure to limit government and a "–" sign indicates a measure to expand government, as reported in NTU's Ballot Guide 2009.

There was only one significant property rights measure in this year's election. Texans passed Proposition 11 on the statewide ballot, which will amend the constitution to prohibit the taking of private property for public use for economic development or tax enhancement purposes. It will also tighten standards for determining "blight," which politicians looking to seize land sometimes abuse. Passing this measure means that taxpayers will be protected from arbitrary or corrupt deals where government takes private property for business development or other purposes. Given the recent news that Pfizer has abandoned the facility for which Susette Kelo (of the famed Kelo v. New London Supreme Court case) had her house seized, Texans can take heart that they enjoy stronger property protections.

Government Reform

Table 5. State Government Reform Measures

State

Number

Subject

NTU Guide

Result

CT

n/a

automatic referendum on town budget

+

Approved

CT

n/a

automatic referendum on town budget

+

Approved

NH

n/a

cap on taxes and spending

+

Approved

TX

1

tax increment financing

Approved

TX

2

property tax reform for residences

+

Approved

TX

3

property appraisal standards uniform

+

Approved

TX

5

single board of equalization

+

Approved

Note: A "+" sign indicates a measure to limit government and a "–" sign indicates a measure to expand government, as reported in NTU's Ballot Guide 2009.

Government accountability measures fared well across the country. Connecticut residents in East Lyme and East Windsor passed measures to provide automatic referendum on their annual town budgets, allowing citizens to vote on the budget outline. This could lead to more responsible spending decisions.

In New Hampshire, Manchester residents voted to place a cap on taxes and spending in future city budgets. The cap will tie the city's spending to the rate of inflation and provide the opportunity for city aldermen to exceed the cap by a two-thirds vote.

Texas saw several other victories in amending the constitution. Proposition 2 will ensure that a residence will be assessed property taxes as a residence and not as a commercial property or other methods that could extract more revenue. This measure will prevent assessors from abusing homeowners by taxing their residences as something other than a homestead. Proposition 3, which was also passed, will streamline procedures for appraising property for tax purposes. This will protect taxpayers from variable tax laws in neighboring jurisdictions.

Conclusion

For advocates of limited government, the ballot measure results from the 2009 election comprised a mixed bag. Americans' concerns on the national level over how much government is growing were visible in some state and local contests, but not uniformly so. Just as landmark laws such as California's Proposition 13 and Colorado's Amendment 1 failed in several forms at the polls before finally being adopted, future gains will likely occur gradually. Fortunately, taxpayer groups and government watchdogs are already working to make sure that pro-taxpayer measures are included on the 2010 ballot. Perhaps more than any other part of the body politic, citizen activists know all too well the importance of the old adage, "If at first you don't succeed, try, try again."

About the Author

Kristine Tuinstra is the State Policy Analyst for the National Taxpayers Union Foundation, a citizen group founded in 1969 to work for lower taxes and smaller government at all levels. For further information, visit www.ntu.org.