Proposed Bill Would Limit Future Investments in Schools, Roads
The proposed Taxpayer Protection Act is meant to sound like a good idea, but in reality it would limit future investments in critical areas like education, health care, and infrastructure. Several other states have tried similar version of this and it's resulted in disastrous budgets.
The bill is a proposed constitutional amendment that would have to be approved by voters in a statewide referendum. It would restrict spending growth to the average inflation rate for the preceding three years plus the average population growth for the same period. That may sound reasonable, but if a recession caused revenues and spending to fall, it would be hard to increase spending to normal levels again after an economic recovery generated normal revenues.
The measure also sets excessive requirements for adding to and spending reserve funds. Those funds, in the event of an emergency, could be tapped again only with a two-thirds vote in both legislative chambers.
Finally, this act would cap corporate and personal income-tax rates at 5 percent. As it cuts income-tax rates, it subjects more services to sales taxes and raises fees for driver’s licenses, auto registrations and other privileges. It simply shifts more of the tax burden to people who must spend nearly everything they earn and can’t afford to save or invest a large share of their income or inherited wealth.
If enacted, the Taxpayer Protection Act would handcuff future legislatures and restrict their ability to meet the state’s needs. It would be like going for a ride in a car without a driver.