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A pro-tax revolt?

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Cally Carswell | Nov 14, 2012 06:00 AM

Dear voter,

This is a test of your reading comprehension:

"Without increasing any tax rate or imposing any new tax, shall Delta County be authorized to collect, retain, and use all revenues derived from impact fees on new development on and after January 1, 2013, as a voter approved revenue change under Article X, Section 20 of the Colorado Constitution ("Tabor"), except that revenues from the County's property tax shall remain subject to the revenue limitations of Article X, Section 20 of the Colorado Constitution; with any such revenues collected, retained or used in excess of the limits of Article X, Section 20 of the Colorado Constitution to be used for public safety, County road and bridge improvements, and public health and human services purposes?"

This bit of legal gobbledy gook that thousands of residents of Delta County, Colo., and I voted "yes" on last week is what we in Colorado call "de-Brucing." It's the way cities, counties, school districts and the like get voters to let them circumvent the state's Taxpayer's Bill of Rights, or TABOR, which limits how much all levels of government in the state can tax and spend. The term itself is an unaffectionate nod to former Colorado legislator Doug Bruce, the father of TABOR. The Bill of Rights is considered the most restrictive such limit in all the land, and has been called "a formula for decline" by the Center on Budget and Policy Priorities because of its contribution to shrinking public funding of education, childhood vaccinations, and health insurance for the poor.

Jerry BrownOn last week's ballot, Delta County was asking its citizenry to allow it to use fees it collected above the ceiling TABOR imposes, which would otherwise be returned to taxpayers. The people of Centennial on Colorado's Front Range similarly voted to free their city from TABOR's shackles, joining a long line of municipalities that have nibbled away at the constitutional amendment since it was enacted 20 years ago, and began limiting their ability to deliver drivable roads, and good schools.

More comprehensive attempts to gut TABOR have been less common, though it was temporarily suspended between 2005 and 2010. But just recently, a lawsuit to kill it off for good was brought, arguing TABOR violates the U.S. constitution by inhibiting the government's ability to perform its most basic functions -- taxing and spending. "Now there's political will, political courage and enough legal firepower to say, 'enough's enough -- we've got to fix this,' " Michael Feeley, the lawyer representing the plaintiffs in the still-in-progress suit told the New York Times earlier this year.

Californians also appear to have shored up the political will to say "enough's enough" to their own super restrictive anti-tax law -- Proposition 13, which since the late 1970s has capped property taxes and required any new state and local taxes to earn a two-thirds vote to pass. It's made new taxes exceedingly difficult to impose, and has taken a hefty share of blame for California's seeming inability to balance its budget.

But in one of the more consequential outcomes of last Tuesday's elections at the state level, California voters sent a "supermajority" of Democrats to the state Senate and Assembly. (A few of those seats will be up for grabs in special elections this winter, but they're in reliably blue districts, so the supermajority is expected to hold.) That means Democrats will be able to approve all the new taxes they please without any Republican votes, rendering Prop 13 relatively toothless as long as the Democrats can keep their seats. Maybe they should start by taxing oil companies for the crude they suck from California's mineral estate, as most states do.

"The impact on a Republican Party that essentially existed to use its veto power over taxes to remain relevant in state politics could be incalculable," wrote Washington Monthly political blogger Ed Kilgore earlier this week.

Perhaps just as significantly, by an eight-point margin the California electorate approved a temporary tax hike on the rich to fund schools. After that measure was blocked by Republicans in the legislature, Gov. Jerry Brown sent it directly to voters. The result: Brown has done the impossible. He has balanced California's budget.

Suggestions are already flying among the chattering class that Brown next turn his attention to reforming Prop 13. Robert Cruikshank of Calitics offered one idea for what shape reforms could take:

Eliminating the 2/3 rule for local tax revenue is probably a more likely win than eliminating the 2/3 rule for the legislature. (A)nd with transportation measures in L.A. and Alameda counties "failing" even with 64 percent support, the need for a fix is clear.

Zooming back out, the broader significance of this moment is well summed up by Salon's Andrew Leonard:

Proposition 13 was a watershed moment in American history, the first crumbling of the post New Deal consensus that supported an activist government intent on educating its citizens and providing them with an adequate safety net. California’s own native son, Ronald Reagan, rode the ideological wave of Proposition 13 right into the White House, and launched an era in which Republicans successfully devoted themselves to crippling government at all levels for decades. Proposition 13 broke California’s government.

The election of Democratic supermajorities suggests that Californians have had enough with broken government. ...

There’s no guarantee, of course, that Democratic control will fix California’s dysfunctions. I think even California liberals might be a little nervous at the spectacle of Gov. Jerry Brown, unchained and at full liberty! Gov. Brown — who, ironically, was also governor of California when 13 passed — now has an extraordinary opportunity to reset the contours of state government, to steer the most populous state in the country back toward prosperity and fiscal sanity. But if he blows it, he could just as easily kick off an entirely new era of disillusionment with Big Government.

Cally Carswell is HCN's assistant editor.

Photo: Gov. Jerry Brown, courtesy of flickr user Steve Rhodes, licensed under Creative Commons.

Patrick Hunter
Patrick Hunter
Nov 21, 2012 11:57 AM
Doug Bruce tried to move an update to TABOR a few years ago by referendum. He would not reveal his funding sources. It lost in the election. It would have meant some modest property tax reductions for average Coloradans.
I thought about the why and the who. It became clear that the main beneficiaries of property tax limits are not the average taxpayer, but instead the most wealthy; the biggest property owners, and thus the biggest property tax payers. It is the 1%. It is they who can afford to fund these referendums, and have the most motivation to do so. It is the Coors family, Philip Anschutz and their pals. And they don't want their names publicized because the game would be clear.
As in California, the prop tax limits have destroyed public education, stopped infrastructure improvements, and cost thousands of good public jobs. All for the greed of the ultra-wealthy.
It is really simple--the rich get richer and the poor get poorer. Old story. A story that is really being pushed hard all over the US and Europe.
See Naomi Klein's book "The Shock Doctrine" and Paul Krugman's column of 11-18-12 in the NY Times.
Thanks for an excellent column.
Patrick Hunter
Carbondale,CO

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