1. TABOR is Wrong for Pennsylvania EPLC Finance Conference, November 15-16, 2007 Sharon Ward Pennsylvania Budget and Policy Center

2. WHAT IS TABOR? A state constitutional amendment that limits the growth of state revenues and expenditures. Requires voter approval to override the limit. Based on a funding formula...

3. =+ Population Growth Inflation Rate Government Spending TABOR FORMULA

4. TABOR’S FLAWED FORMULA CONSUMER PRICE INDEX (CPI)  DOES NOT Reflect WHAT the State Buys  HEALTH CARE CLOTHING  EDUCATION VERSUSFOOD  PUBLIC SAFETYHOUSING  2. DOES NOT reflect HOW FAST public sector goods and service costs INCREASE over time

5. POPULATION GROWTH Pennsylvania: Total Population versus Specific Sub-Population (1990 to 2006) Avg. Change TOTAL POPULATION4.7% K-12 Enrollment9.9% Disabled Population18.4% State Prison Population 15.0% Medicaid Enrollment41.4%

6. In 1991-92, CO ranked 35th in state and local spending for K-12 as a share of personal income. In 2000, it fell to 49th In 1991-92, CO ranked 30th when comparing the average salary of teachers to annual earnings in the private sector. In 2002, CO fell to 50th In 1991-92, CO ranked 35th in state spending for higher education as a share of personal income. In 2004, it fell to 48 th In 2004, CO ranked 44th in the number of children receiving scheduled immunizations In 1992, CO ranked 23rd in adequacy of pre-natal care. In 2002, it ranked 48th In 1992, CO ranked 33rd in percentage of low-income children lacking health insurance. In 2004, it ranked 50th Consequences in Colorado

7. TABOR Did Not Improve Colorado’s Economy, as Proponents Claim Average Annual Employment Change Before and After TABOR 1980-19921992-2004 Colorado2.1%2.6% Mountain States (median)2.1%2.8%

8. REALITY CHECK

9. State Spending is Constant Relative to the Size of PA Economy

10. PA General Fund Spending is Not Out of Control

11. Taxes and Spending Stable Over Time Pennsylvania: 2005  6 th largest state  6 th in total state revenue  5 th in total state expenditures  22 nd in state revenue per capita  24 th in state expenditures per capita  32 nd in state taxes as a share of personal income Total Pennsylvania State and Local Taxes as a Share of Personal Income By Decade Decade 1980- 1989 1990- 1999 2000- 2005 Taxes as Share of Personal Income 9.9%10.3%10.4% Rank273129

12. PA Spending Increases Generally Lag the National Average

13. $7.9 billion gap in 2007

14. What Could Pennsylvania Fund Under TABOR? (FY 2007, in $ millions)

15. NOW is the Time to Act Fight the good fight now to avoid having to change it later. Why start digging a hole even if you know you can stop digging? Consequences for families is too high.