Jack Fencl

New Research Examines State-By-State Growth In Per Capita State Spending

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Posted by Jack Fencl on Tuesday, August 11th, 2020, 2:46 PM PERMALINK

State government spending nationwide has grown steadily over the past two decades, according to new research conducted by Americans for Tax Reform, utilizing data from the National Association of State Budget Officers and the Census Bureau. 

After controlling for inflation, average per capita state spending rose by 25.58% between 2000 and 2018, with the vast majority of the growth taking place between 2000 and 2010. In 2000, inflation adjusted average per capita state spending was $4,885.30. In 2010, inflation adjusted average per capita state spending was $6,033.84. By 2018, inflation adjusted average per capita state spending had risen to $6,134.97.   

Inflation adjusted average per capita state spending in most states spiked rapidly from 2000 - 2010, rising by an average of 23.51% that decade (the Bush years were bad for spending at both federal and state levels). After the 2010 wave election, average per capita state spending was held nearly flat, rising only 1.68% between 2010 and 2018. 

Between 2000 and 2018, inflation adjusted per capita state spending rose in 49 states. Only Florida saw a reduction in per capita spending since 2000, with the Sunshine State experiencing a 14.67% decline over the 18 year period. Florida was also the only state that had a decline in per capita state spending in the decade from 2000-2010. Today, Florida has the lowest per capita state spending at $3,696.19 (2018 dollars). This, coupled with the state’s lack of an income tax, its supermajority requirement for the state legislature to raise taxes, and its national leadership in expanding school choice make Florida a limited government success story. 

Twelve states saw their per capita spending grow by more than 40% over the last two decades, with the table below listing the ten states where spending grew most rapidly. West Virginia has the unfortunate distinction of leading the pack, with the Mountain State’s spending growing by an astonishing 79.89%. While this is certainly a dubious honor, West Virginia has made some progress in recent years, with per capita state spending declining by 26.21% between 2010 and 2018. 

10 States Where Per Capita State Spending Grew The Most Since 2000

State

% Per Capita Spending Growth ('00-'18)

West Virginia

78.89%

Colorado

77.07%

Vermont

70.24%

Wyoming

62.88%

Arkansas 

54.87%

North Dakota

51.77%

New York

49.04%

Montana 

45.68%

Pennsylvania 

45.50%

Maryland 

44.02%

 

On the flip side, the table below lists the ten states that did the best job at keeping spending under control over the past two decades. Among this group, the four states that stand out for their superb fiscal restraint are Florida, Missouri, South Carolina, and North Carolina. These are the only states that held per capita spending growth to single digits (with Florida seeing a real reduction) since the turn of the century. 

10 States Where Per Capita State Spending Grew The Least Since 2000

State

% Per Capita

Spending

Growth ('00-'18)

Florida

-14.67%

Missouri

1.66%

South Carolina

2.02%

North Carolina

2.64%

Georgia 

10.53%

Michigan

10.58%

Utah

10.72%

Idaho

11.11%

New Hampshire

13.14%

Maine

13.40%

 

Below is current (2018 data) per capita spending for all 50 states, ranked lowest to highest. The national average is $6,134.97.   

50 States 2018 Per Capita Spending, Ranked Lowest to Highest

State

2018 Per Capita Spending

Florida

$3,696.19 

Texas

$4,024.22 

Missouri

$4,253.45 

New Hampshire

$4,529.85 

Idaho

$4,548.89 

Utah

$4,689.64 

Nevada 

$4,711.40 

North Carolina

$4,800.02 

Georgia 

$4,889.48 

South Carolina

$4,967.79 

Indiana 

$5,021.43 

Tennessee

$5,049.01 

South Dakota

$5,072.28 

Arizona 

$5,238.04 

Kansas

$5,473.05 

Alabama

$5,577.70 

Michigan

$5,670.43 

Illinois 

$5,720.55 

Oklahoma 

$5,753.21 

Ohio

$5,967.88 

Washington

$6,116.67 

Virginia

$6,125.66 

Maine

$6,281.29 

Nebraska 

$6,305.00 

Montana 

$6,554.38 

Mississippi

$6,592.71 

Pennsylvania 

$6,633.04 

Louisiana 

$6,707.10 

California 

$6,833.68 

New Jersey

$6,839.39 

Colorado

$6,995.61 

Minnesota

$7,102.61 

Maryland 

$7,256.04 

Iowa

$7,426.12 

Kentucky

$7,633.00 

Wyoming

$7,661.00 

North Dakota

$7,768.31 

Wisconsin

$8,299.57 

Massachusetts

$8,299.87 

New York

$8,384.08 

Arkansas 

$8,518.03 

Rhode Island

$8,751.88 

Vermont

$9,089.34 

Connecticut

$9,282.32 

West Virginia

$9,342.73 

Oregon

$9,713.08 

New Mexico

$9,776.65 

Hawaii

$10,699.05 

Delaware

$11,234.84 

Alaska

$14,013.68 


An examination of what happened following the 2010 wave election, a period during which Republicans achieved a level of control in state legislatures not seen in roughly a century, shows that states exerted much more fiscal restraint compared to the previous decade. 

The table below lists the ten states that experienced the most precipitous decline in spending per capita between 2010 and 2018. While these ten saw the most dramatic cuts in per capita state spending, 22 states in total experienced a reduction over the period. The overwhelming majority of states where spending declined are Republican led, and in the historically blue states that saw spending drop, Republicans held power at some point over that eight year period.

10 States Where Per Capita State Spending Declined The Most After 2010

State

% Per Capita Spending Growth ('10-'18)

Wyoming

-50.97%

West Virginia

-26.21%

Mississippi

-25.30%

North Carolina

-18.16%

Louisiana 

-16.49%

Maine

-13.32%

Alaska

-11.03%

Utah

-10.32%

Oklahoma 

-10.04%

Massachusetts

-7.74%

 

On the flip side, some states saw their spending per capita continue to rise at an unsustainable clip after 2010. The table below lists the ten states where spending rose most rapidly from 2010-2018. This list is mostly comprised of blue states, with the usual culprits like Illinois, Hawaii, and New York seeing some of the most egregious spending growth. 

10 States Where Per Capita State Spending Grew The Most After 2010

State

% Per Capita Spending Growth ('10-'18)

Nevada 

33.42%

Illinois 

29.30%

Connecticut

18.39%

Hawaii

15.71%

New Mexico

13.97%

Alabama

12.45%

Kentucky

11.06%

Maryland 

9.96%

New York

9.50%

Minnesota

9.33%


Overall, two clear pictures emerge from the data. The first is that per capita state spending has been growing at an alarming rate over the past two decades. The second is that continued profligacy is not inevitable and that course correction can occur. The post-2010 state spending trends prove that it is possible for states to exercise fiscal restraint, provided that those in positions of power have the necessary political will and courage. 

[State spending comes from the National Association of State Budget Officers annual spending reports for years 20002010 and 2018. Population information provided by the United States Census Bureau.]

Photo Credit: Peter Fitzgerald

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Ohio Expands Prevailing Wage Mandates, Unnecessarily Inflating The Cost Of Infrastructure In The Buckeye State

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Posted by Jack Fencl on Thursday, July 30th, 2020, 1:16 PM PERMALINK

The arrest and indictment of Ohio House Speaker Larry Householder on federal racketeering charges has made national headlines and shaken up Ohio’s political leadership. Unfortunately, bad decisions are nothing new in Columbus, as illustrated by the recent passage of Senate Bill 4 (SB 4). 

Recently enacted with bipartisan support and signed into law by Gov. DeWine, SB 4 allocates funding for construction and conservation projects, including money for new schools. But that’s not all it does. House Republican leaders, through an opaque process, amended the bill to include an expansion of the state’s prevailing wage law, which will increase the taxpayer cost of many construction projects, reducing the number of projects that can be undertaken in the first place. 

Prevailing wage laws require government funded construction jobs to pay workers inflated, typically union-dictated wages. These laws benefit unions by killing competition, but burden taxpayers with added costs, which is why many neighboring states, including West Virginia, Michigan, and Wisconsin, have repealed them in recent years. Alas, Ohio legislative leaders put special interests ahead of state interests and expanded, rather than repealed, prevailing wage in Ohio. 

In 1997, Republican lawmakers exempted Transportation Improvement Districts (TDIs) from prevailing/inflated wage laws as a way to save taxpayer money and promote economic development. Far from being a loophole, as some defenders of prevailing wage suggest, this exemption was well-crafted and merited. SB 4 expands prevailing wage by ending the exemption for TDIs, which include more than half the counties in Ohio. 

The expansion of prevailing wage is bad policy that will cost Ohio taxpayers dearly, also concerning is the process in which prevailing wage expansion was passed. As already mentioned, SB 4 allocates funding for capital improvement projects; it has nothing to do with prevailing wage laws and the amendment may even be illegal under the single subject rule of the Ohio Constitution. A similar attempt to expand prevailing wage was voted down less than two months ago, when Democrats in the Senate attempted to amend a land conveyance bill to include the exact same prevailing wage expansion. That time, Senate Republicans voted it down.  

At a time when the pandemic is putting a massive hole in Ohio’s budget, it makes no sense to expand prevailing wage mandates that needlessly and significantly increase costs for taxpayers. The bad news is that this move will harm Ohio taxpayers. The good news is that Ohio is an outlier here and most states are getting rid of their prevailing wage mandates. 

Photo Credit: Jeff Kubina

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D.C. Council Abandons Plans for Disastrous Advertising Tax Hike

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Posted by Jack Fencl on Monday, July 27th, 2020, 1:16 PM PERMALINK

In a last minute scramble, the Washington, D.C. City Council dropped its misguided plans to assess sales tax on advertising purchases. Had Council Chairman Phil Mendelson’s plan been approved, businesses throughout the nation’s capital would’ve been hit with a 3 percent sales tax on a critical business input at a time when many employers are struggling to stay afloat. 

The advertising tax was originally proposed as part of larger budget negotiations. As such, it never got a proper hearing and those who would have been harmed never had a chance to object. Aside from the opaque and hasty manner in which this misguided tax hike initially advanced, the now-aborted advertising tax was a terrible policy. 

Advertising costs are an ordinary and necessary business expense, along with payroll and rent. As such, advertising costs are and should be deductible for income tax purposes and should also be exempt from state and local sale tax. 

Taxation of business inputs like advertising, be that through the assessment of sales tax or another form of taxation, results in cascading, snowballing, and hidden additional costs for the ultimate consumer. This phenomenon is known as “tax pyramiding,” as a new tax is levied at each level of production, yielding higher and less transparent costs for the end consumer.

D.C. councilmembers aren’t the only politicians who have recently sought to raise taxes on advertising. Maryland state legislators approved a special tax on digital advertising, a levy widely viewed a clear violation of the Internet Tax Freedom Act, back in March. Governor Larry Hogan (R) smartly vetoed that tax hike last month, helping Maryland businesses avoid a costly tax hike in the middle of a recession on a crucial business input. Hogan’s veto also helped Maryland taxpayers avoid the cost of the legal suit that was sure to follow the enactment of any digital ad tax. 

The good news is that the proposal is dead. The D.C. Council approved the $16.2 billion budget on Thursday, opting to trim spending by $18 million and use accounting maneuvers to make up revenue forgone by dropping the advertising tax. Consumers and business in D.C. dodged a bullet on this one. 

Photo Credit: Mario Duran-Ortiz

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Black Market in Decline as States Legalize Sports Betting

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Posted by Jack Fencl on Thursday, July 23rd, 2020, 6:37 PM PERMALINK

Baseball is back! As fans begin to root for their teams, Americans who live in 18 states can now bet on games legally. 

In 2018, the Supreme Court overturned the Professional and Amateur Sports Protection Act (PASPA), a 1990s era federal law that prevented states from permitting sports betting. Since the ruling, 17 states have legalized and launched regulated sports betting, bringing the total of states where residents can legally bet on sports to 18. (Nevada was exempt from PASPA and has long had a legal sports betting industry.) Five additional states have legalized some form of betting but have not yet launched sports books, meaning that residents in 23 states will soon have access to licit betting markets. 

Of course, just because it is now legal doesn’t mean sports betting is anything new. PASPA merely pushed the practice to an underground black market, as overly restrictive government regulation does. The illicit betting market thrived for decades, with billions of dollars in economic activity going from American’s wallets to illegal offshore operations, criminal interests, and beyond. 

With legal sports betting becoming more widely available, research shows bettors are taking their business to the legal, regulated market. 

New research from the American Gaming Association (AGA) shows that 74% of sports bettors believe that it is important to bet with legal betting services. This corresponds with a 25% decrease in spending with illegal books since the Supreme Court ruling. In other words, bets are shifting from the illegal market to the legal one. 

In addition to simply wanting to comply with the law, bettors say they prefer legal markets because they know their wagers will be paid out, and that there are legal remedies they can pursue if a problem arises. 

The study also found that 55% of people who placed wagers with illegal operators did so thinking they were betting legally. 

Legal sports betting, with low tax rates and reasonable regulation, is a win for the economy, and taxpayers. It is a better way for government to gain new revenue than seeking to hike existing taxes. 

Americans have legally wagered more than $22 billion since the 2018 ruling opening up sports betting in the states. That translates to $198 million in new tax revenue for state and local governments – and that is with less than half the states having sports betting.

Moreover, 2020 was set to be a record year for the industry. Before the pandemic hit, $3.5 billion had been wagered in January and February, smashing the previous record of $1.9 billion from a year earlier. 

There is room for the sports betting market to grow, and opportunity for smart government policies.  Still, overly aggressive government taxation and regulation can ruin a good thing. High tax rates, especially those above 15%, will reduce betting activity, as bettors stick with the black market.  To keep the good news coming, states pursuing legalization will have to follow good examples like New Jersey, Iowa, or Indiana, and avoid the mistakes of Illinois, Pennsylvania, and Tennessee. 

Photo Credit: Alacoolwiki

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Louisiana Legislature Passes Much-Needed Legal Reform

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Posted by Jack Fencl on Friday, July 10th, 2020, 12:03 PM PERMALINK

The Republican controlled Louisiana legislature – which consists of new leadership in the House and Senate – boldly took on the special interests who have been abusing Louisiana’s corrupt legal system and harming the economy for far too long.

If signed into law by Governor John Bel Edwards, House Speaker Clay Schexnayder’s House Bill 57, the Civil Justice Reform Act of 2020, will bring some much-needed legal reforms to the Pelican State that will ultimately result in lower costs for the hardworking people of Louisiana. 

“Citizens of Louisiana feel the cost of government in three ways: The burden of taxes, the cost of regulations, and the hidden costs of tort law abuse,” explained Grover Norquist, president of Americans for Tax Reform. “These three things make everything in Louisiana more expensive than in other states.” 

According to the R Street Institute’s 2019 Insurance Regulation Report Card, Louisiana has one of the most concentrated auto markets in the nation, which could “be an indication of unnecessarily high barriers to entry or other market dysfunction.” The lack of competition in a concentrated market prevents market forces from driving prices down and results in fewer options being available to consumers. This is likely one of the reasons Louisiana has the second highest auto premiums in the country, behind only Michigan. 

Louisiana’s corrupt legal system – which results in insurance companies facing higher costs – has definitely created a barrier to entry or “market dysfunction.” For example, the threshold necessary to receive a civil jury trial in Louisiana is $50,000! For context, the state with the second highest monetary standard is Maryland, at $15,000. 

Fortunately, if enacted, HB 57 would address this problem by lowering the threshold for a jury trial to $10,000. While it could be lower still, this reform is a tremendous improvement that would put Louisiana more in line with other states and ensure due process is available for all Louisianans.

Another reform included in HB 57 is the repeal of the seatbelt gag rule. The seat belt gag rule, enacted in the 1980s, prevents juries from knowing if persons injured in an auto accident were wearing seat belts. Repealing this law will help bodily harm awards remain more in line with the circumstances of the accident, ultimately saving people money.

These changes and some of the other reforms included in HB 57 will help create a fairer legal system in Louisiana, moving it away from one that favors plaintiffs and results in high auto insurance rates and other needless cost burdens placed on the state’s working families.

“The Pelican Institute congratulates the legislature on its overwhelming passage of critical legal reforms, which will lift the burden lawsuit abuse places on all Louisianans,” said Daniel Erspamer, chief executive officer of the Pelican Institute for Public Policy. “It’s past time to Get Louisiana Working, and HB 57 will help make our state a place that creates and encourages, rather than chases away, jobs and opportunity for all its citizens.”

Lawmakers have been attempting to fix Louisiana’s terrible legal climate for a long time, including earlier this year when the legislature passed Senator Kirk Talbot’s Senate Bill 418. The tort reforms contained in SB 418 were similar to those of HB 57, but it was vetoed by Gov. Edwards. However, Edwards has said he will sign HB 57.

For far too long, Louisianans have suffered under the hidden costs of corrupt tort laws and lawsuit abuse. The reforms included in HB 57 are a great step towards reforming Louisiana’s broken legal system.  

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If Georgia Governor Brian Kemp Wants To Keep His Commitment To Voters, He’ll Veto The Recently-Passed Vape Tax Hike

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Posted by Jack Fencl on Wednesday, July 8th, 2020, 4:07 PM PERMALINK

Georgia Governor Brian Kemp (R) is one of 12 sitting governors who has signed the Taxpayer Protection Pledge, a written commitment to voters to oppose and veto any and all efforts to raises taxes. If Georgia Gov. Brian Kemp is to keep this promise to Georgia taxpayers, then he will veto a bill currently sitting on his desk that would impose an onerous tax increase on Georgia vapers. 

Despite being under firm Republican control, both the Georgia House and Senate passed Senate Bill 375, a tax hike projected to raise about $14.5 million in new tax revenue annually by creating a 7 percent tax on vapor products. ATR opposed SB 375 from the beginning not only because it amounts to a significant tax hike, but also because it will adversely impact the health of Georgians by making a less harmful alternative to cigarettes far more costly. 

A recent study by the National Bureau of Economic Research found that a vape tax in Minnesota prevented about 32,400 adult cigarette smokers from quitting. Similarly, a Georgia State University study found that for every 10 percent increase in taxes on nicotine vapor products, cigarette sales rose 11 percent. That same study also found that e-cigarette sales dropped 26 percent, indicating vape tax hikes push consumers to use traditional combustible cigarettes instead. 

In many cases, misguided government policies are merely frustrating, but in this case it is literally lethal. While there are risks associated with vaping, it is clearly much less harmful than smoking. In fact, the global consensus by health expertes is that vaping is at least 95 percent less harmful than smoking traditional cigarettes.  

The vape tax hike approved by Georgia lawmakers in June was not the first tax hike they passed this year. Earlier this year, the Republican controlled Georgia legislature passed House Bill 276, which amounts to a massive $150 million per year tax hike by forcing out-of-state marketplace facilitators to collect and remit sales taxes on online purchases in made by Georgia residents. 

The proclivity for tax hikes on the part of Georgia Republicans makes them an outlier in a region full of GOP-run legislatures that have been busy cutting taxes in recent years. Lawmakers in Florida and Tennessee cut taxes this year as a way to spur the economic recovery. North Carolina Republican legislators have been able to enact pro-growth tax cuts in recent years, overcoming the opposition of a Democrat governor who wants to raise taxes. Meanwhile, Republican lawmakers in Georgia have a Taxpayer Protection Pledge signer in their governor’s mansion and keep sending him tax hikes.  

Governor Kemp should veto SB 375 because it’s a mid-recession tax hike on a product that helps people quit smoking, and also a regressive tax hike that will disproportionately harm those who can least afford it. If that weren’t enough, Governor Kemp should also veto this tax hike because, by doing so, he’ll uphold one of the key promises he made on the campaign trail two years ago. 

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Vape Tax Threatens the Well-Being of Georgians

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Posted by Jack Fencl on Friday, June 26th, 2020, 2:17 PM PERMALINK

In spite of clear medical evidence and basic economics, politicians in Georgia are trying to impose a new 7 percent tax on vapor products. The evidence is clear—a vape tax would be bad for Georgia’s physical and economic health. 

 

Senate Bill 375 (SB 375) passed the House on a 123-33 vote June 25th. Though the proposal’s goal is ostensibly to curb youth use of vapor products, evidence from other states that have tried this route shows that there will be serious unintended consequences. 

 

A recent study by the National Bureau of Economic Research found that a vape tax in Minnesota prevented about 32,400 adult cigarette smokers from quitting. The reason for this is obvious—smokers use vaping products to quit, but when taxes make vapes more expensive, smokers are discouraged from using them. It’s basic economics. 

 

A Georgia State University study found similar results for other states that have recently implemented vape taxes. The study found that for every 10 percent increase in taxes on nicotine vapor products, cigarette sales rose 11 percent. E-cigarette sales also dropped 26 percent, proving these taxes are pushing consumers to use unhealthy traditional cigarettes.

 

This research paints a worrisome picture. While there are still risks associated with vaping, it is clearly much healthier than smoking. In fact, health experts estimate that vaping is 95 percent less harmful than smoking traditional cigarettes. Given that higher taxes on vapes will lead to more traditional cigarette use, legislation like Georgia’s SB 375 will lead to negative health consequences, while imposing a regressive tax hike that disproportionately harms those who can least afford the added cost.  

 

Vaping tax hikes disproportionately harm low income Americans who are least able to afford a higher tax burden. If SB 375 is enacted, it will prevent mostly low income Georgians from using safer alternatives to quit smoking. Money hungry politicians may care more about the immediate $14.5 million in revenue the tax will generate, but Georgians who are trying to quit smoking will care more about the impact on their personal health for decades to come. 

 

Unfortunately, the push to raise vape taxes is not confined to Georgia. Similar efforts are underway in Colorado and California. In addition to being bad health and fiscal policy, these proposed vaping taxes also make for terrible politics. An October 2019 poll found that 83 percent of vapers are single-issue voters, meaning that where a candidate stands on vaping issues is the most important factor in determining how they will vote. It is easy to understand why someone trying quit smoking, a literal attempt to save their life, would care about this a lot. Politicians who support these tax increases do so at their own peril. 

 

House passage of this tax hike this week comes despite the fact that Georgia House Speaker John Ralston (R-Blue Ridge) previously stated that he was opposed to further tax hikes this session. If this tax increase were to get to Governor Brian Kemp’s desk, it would be a violation of the written commitment Governor Kemp made to Georgia voters to “oppose and veto any and all efforts to raises taxes.” 

 

SB 375 now goes to the Georgia Senate for further consideration. This comes after the Senate Finance Committee approved a bill that contains both a vape tax as well as a massive increase in traditional tobacco taxes. House Bill 882 would more than triple Georgia’s current 37-cent per pack tax rate for cigarettes while also creating a vape tax that would have similar effects to that of SB 375. 

 

Tax hikes of all stripes should be off the table as Georgia begins to recover from the pandemic-driven downturn. The regressive proposals under consideration will actively harm Georgia’s economic and physical health and thus should be swiftly rejected. 

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Joe Biden Supports Proposal that would Destroy California Small Businesses

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Posted by Jack Fencl on Wednesday, June 17th, 2020, 3:20 PM PERMALINK

While the presidential election will attract the most attention this fall, voters in California may decide the fate of a ballot initiative that, if passed, would inflict further harm on the state’s economy by imposing a $12 billion annual tax hike. Initiative #19-0008, also known as the “California Tax on Commercial and Industrial Properties for Education and Local Government Funding Initiative,” would raise property taxes on businesses at a time when they are already reeling from the devastating effects of the pandemic-driven downturn. This massive tax hike would be accomplished by repealing a property tax cap that’s been on the books in California for more than four decades. 

 

In 1978, California voters approved Proposition 13, which caps annual increases in the taxable value of a property, both personal and commercial, at 2% or the rate of inflation, whichever is less. Transferred properties are reassessed at 1% of their sale price. In addition to this property tax cap, Prop. 13 subjects all tax increases to a two-thirds supermajority vote requirement of the legislature. 

 

Critics of Prop. 13 complain that property values in California rise quickly and thus businesses are paying less in taxes than they would if they were taxed on their market value. This is certainly true, but it is a feature, not a bug, of Prop. 13.  

 

The initiative to repeal Prop. 13, if approved, could bring in as much as $12.5 billion in new tax revenue annually. This is because tax rates for commercial and industrial properties would be based on their assessed market price as opposed to their purchase price, resulting in a significantly higher tax burden for businesses. 

 

Though Prop. 13 repeal would hurt most people, it would, of course, grow the government. It is no surprise, then, that the measure is backed by teachers’ unions and big government, tax and spend Democrats, including Joe Biden. Clearly, he cares more about placating union demands and appeasing the socialist wing of the Democratic Party than he does about the fate of small businesses and hard working Californians. 

 

Unsurprisingly, businesses are opposed to a proposition that would inflict a painful tax hike on them. In recent weeks, Gov. Gavin Newsom—who has not endorsed the initiative—has expressed interest in removing the measure from the ballot in exchange for a lesser tax increase. 

 

“We are considering other approaches, including other revenue strategies,” he said.  “We will  pursue conversations with the Legislature, with leaders all up and down the state and we hope we can help guide some consensus about what is most appropriate to put forward to the voters.”

 

California has a long history of negotiations over ballot measures, especially when it comes to tax issues. For example, in 2018 a ballot initiative that would have prevented cities and counties from raising taxes without the approval of a supermajority of voters was removed in exchange for a temporary ban on new local soda taxes. While this may happen for the initiative to repeal Prop. 13, it is still on the ballot and so long as it is remains a significant threat to California’s economy. 

 

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AZ Dems Kill Bill That Would Have Stopped Authorities From Taking Innocent Peoples’ Stuff

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Posted by Jack Fencl on Wednesday, June 3rd, 2020, 12:15 PM PERMALINK

Civil asset forfeiture reform is overdue in many states. Currently, 19 states require a criminal conviction for forfeiture, 16 require a criminal conviction to forfeit property in civil court, and 3 have abolished forfeiture. That is tremendous progress, but leaves plenty of work to be done. 

Arizona is one state that still allows authorities to take property from innocent parties, and the process to attempt to get that property back is complex, and the window to act is short. 

Arizona lawmakers had a chance to fix this with Senate Bill 1556, which ATR strongly supported. The bill, sponsored by Sen. Eddie Farnsworth (R–Gilbert), would have required that a person be convicted of a crime before law enforcement can attempt forfeiture, with some reasonable exceptions, like if a defendant fled the state. Another change the bill would have made is that the state would no longer be able to seize the property of people who didn’t know their assets were used in the commission of a crime. In a system where people are presumed innocent until proven guilty, these changes are reasonable and long overdue. 

Despite passing the Senate unanimously earlier in the year, the House recently rejected the bill. Incredibly, it was unanimous Democratic opposition that killed the legislation. 

Why would Democrats vote to give police the power to take innocent peoples’ property? According to the Arizona Capitol Times, Rep. Kirsten Engel (D-Tucson) admitted that the status quo leads to abuses by law enforcement, but “she could not support such a change without also finding a way to ensure that counties have the money they need.” 

Basically, Democrats said that even though the system tramples on individual rights it should remain in place because it generates money for the government. In other words, they think the state should be allowed to steal from people because they budgeted around it. 

Republican Attorney General Mark Brnovich falsely claimed the bill would have prevented prosecutors from putting a lien on a suspected criminal’s property. Basically, their argument was the bill would have allowed criminals to liquidate their assets before they are officially convicted of a crime, thus preventing the state from being able to seize property until it is too late. However, as Sen. Farnsworth noted, this is simply untrue. His bill would have allowed prosecutors to place liens on property, but they would have to show said property is evidence in a pending case—in other words, prosecutors would not be permitted to target assets unrelated to the crime in question. 

study by the Institute for Justice found that most forfeitures in Arizona involve small sums of money—56 percent were for less than $1,000, and only 20 percent of defendants contesting forfeiture had attorneys. This means that the system is mostly used to target individuals, not large drug cartels or big-time criminals as forfeiture’s defenders claim. 

The study also found that although the government almost always wins forfeiture cases, less than half of forfeitures are tied to a criminal conviction. Moreover, despite claims to the contrary, forfeiture is almost never used to compensate victims of crimes. In 2018, victims were compensated in four of the 1,469 forfeiture cases statewide, meaning this happens less than .3 percent of the time. 

Despite all this, and the reality that minority communities are often the target of asset forfeitures, Democrats said no, no due process, no right to your property, no innocent until proven guilty. If we need the money, injustice is fine. 

Especially in light of recent events, there is no excuse not to pass this reform next session. 

Photo Credit: Gage Skidmore

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