Presentation on theme: "2012 Ballot AMENDMENT 3 “TABOR/SMART CAPS” The Impact on Florida’s Kids, Communities and Economy 2012 Ballot - AMENDMENT 3: “TABOR/SMART CAPS” The Impact."— Presentation transcript:
2012 Ballot AMENDMENT 3 “TABOR/SMART CAPS” The Impact on Florida’s Kids, Communities and Economy 2012 Ballot - AMENDMENT 3: “TABOR/SMART CAPS” The Impact on Florida’s Kids, Communities and Economy Karen Woodall, Executive Director Florida Center on Fiscal & Economic Policy
What is Amendment 3? A CONSTITUTIONAL AMENDMENT – Budget/Taxes Replaces the existing, reasonable revenue limits with a new limitation based on inflation and population change. What happens to the left-over money? – Any funds that exceed the revenue limits would be placed in the state's "rainy day fund." – Once the fund reaches 10% of the prior year's total budget the Florida State Legislature would be required to vote to either provide tax relief or reduce property taxes. The proposed measure requires 60 percent voter approval for adoption.
It seems simple and reasonable, but it’s based on a COMPLICATED and FLAWED formula that just does not work New Formula – State revenues can’t grow faster than the rates of Population + Inflation Why is Amendment 3 a problem?
The FLAWED Formula Population + Inflation -POPULATION AVG population that doesn’t capture growth in populations served by government (such as, kids with disabilities, seniors, prison population) -INFLATION Inflation, measured by the CPI-U doesn’t capture the growth of public sector expenses (such as, education, health care, transportation)
Why is Amendment 3 a problem? The purpose is to SHRINK government. It’s a GIMMICK. It does nothing to encourage efficient spending of taxpayer dollars. It THREATENS OUR ECONOMIC RECOVERY. It THREATENS OUR BOND RATING. It will make school construction, road repairs, and new improvements more expensive and less attainable.
It REMOVES FLEXIBILITY for our policymakers. It places the state’s budget on AUTO-PILOT. It REMOVES ACCOUNTABILITY from our ELECTED LEADERS. Why is Amendment 3 a problem?
Wait, There are MORE Problems?! Constitutional – the Limits are PERMANENT It’s NOT FISCALLY RESPONSIBLE – Unintended consequences Doesn’t allow us to plan for our future It will result in COST-SHIFTING TO LOCAL GOVERNMENT and COMMUNITIES.
AMENDMENT 3 – FAILED EXPERIMENT Colorado is the ONLY state to have a measure similar – called “TABOR”. Adopted in 1992. Strangled the budget, slowly squeezing tighter every year. Suspended in November 2005 – a bi-partisan coalition of business, children’s advocates, education, health, senior groups led the effort.
“ A good ‘business climate’ depends as much or more on the quality of public services as it does on the state’s tax level. ” - Deloitte & Touche/Fantus Consulting “ For businesses to be successful, you need roads and you need education, both of which have gotten worse under TABOR and will continue to get worse. ” -Tom Clark, Denver Metro Chamber of Commerce Executive Vice President AMENDMENT 3 – FAILED EXPERIMENT
Average Annual Employment Change Before and After TABOR 1980-19921992-2004 Colorado2.1%2.6% Mountain States (median) 2.1%2.8% Source: Bureau of Labor Statistics AMENDMENT 3 – FAILED EXPERIMENT TABOR Did NOT Improve Colorado’s Economy as Promised
Arizona12.8% Colorado0.2% Idaho10.3% Nebraska7.5% Nevada19.1% New Mexico8.7% Utah8.0% Wyoming9.8% Job Growth (March 2001- January 2006) Colorado’s Job Growth After the Recession Was VERY SLOW Source: Bureau of Labor Statistics AMENDMENT 3 – FAILED EXPERIMENT