05/27/2008
You may have heard that NFIB is launching an initiative to get a total revenue cap on local governments. Here's where we are in the process and how you can get involved.
The goal of the initiative is to give citizens control over local government spending by placing a total revenue cap on local government. The cap would only be breakable by the approval of you, the voter. The petition effort will lead to a constitutional amendment being placed on the 2010 ballot.
The initiative is just getting under way. NFIB is currently conducting polling and assessing possible petition language, with an official launch for the effort slated for this July.
Make sure we have your e-mail address to receive up-to-date information on the initiative's launch and how you can help the fight! E-mail Florida@nfib.org to be added to our revenue cap distribution list.
Revenue Cap Frequently Asked Questions
Q: How can I show my support?
A: You can support the initiative by:
- Printing, signing and returning the NFIB volunteer petition currently on our Web site to offer to collect signatures when our amendment petition is ready.
- Printing, signing and returning the official petition that we will e-mail you when the campaign is launched in July.
Q: Why is a revenue cap so important?
Q: When will you have this on the ballot?
A: We hope to gain enough support to place it on the 2010 ballot.
Q: Would this be a problem if local officials were held accountable for their actions?
A: Because local governments can hide revenue increases in a complex variation of taxes and fees it is very difficult to hold them accountable during re-election; a revenue cap breakable only by voter approval is a more effective way to hold them accountable and stop repeated tax increases.
Q: Won't this damage our community's bond rating?
A: This is a frequent criticism of revenue caps. In Colorado, where a similar measure has been in place for several years, they have not experienced any damage to local governments' bond rating as a result of the revenue cap. We believe in bonding, as we still expect our governments to be able to undertake large public works projects: water systems, roads, schools, etc. Our amendment will still provide for bonding.
Q: There are a lot of improvements that my community wants to make; won't this kill a lot of community projects?
A: It will not stop any project that has broad community support. If it does not exceed the revenue cap, the project moves forward. If it exceeds the revenue cap the project will move forward if a majority of the voters support it.
Q: Couldn't the legislature do this?
A: Yes, but they have chosen not to. The House passed a similar proposal in April of 2008, but the Senate refused to even consider it. Local governments have spent millions of taxpayer dollars fighting all attempts to cut property taxes.
Q: Has this been done anywhere else before?
A: Similar proposals have been passed in other states, most notably in Colorado in the mid-1990s.
Q: How did this work in Colorado?
A: It's worked very well in Colorado. When voters have real authority to determine how much they will pay in taxes, and therefore limit the ability of government to waste money, they become more prosperous. Government can increase revenues and spending, if they make their case to the public and voters approve it.
Q: Could this make residential property taxes go up?
A: Naturally, property taxes rise as real estate values rise. The main reason the property tax issue reached crisis level is the fact local governments held millage rates steady as real estate values skyrocketed, reaping a windfall. Had this amendment been in place at the time, local governments would have been forced to reduce millage rates to remain under the revenue cap and the crisis would not have occurred.
Q: What happens if a real emergency arises, like a hurricane, and our community needs to re-build?
A: The proposal will allow for an emergency reserve fund that will represent a percentage of a local government's annual budget. It will also allow for the imposition of emergency taxes. In these circumstances, it would be up to the voters whether the emergency taxes are continued beyond the pre-set amount of time.
Q: Won't local revenue go back down when the housing and real estate market level out?
A: No. Historically, property values rise consistently over time. If the local government holds property tax rates steady, they should see increased revenues over time. If the revenues increase at such a rate as to exceed the cap, as they did in the real estate spike in the middle of this decade, local governments would be forced to lower millage rates or seek voter approval to exceed the cap.
Q: This is just like Hometown Democracy, which a lot of people oppose, how is this different?
A: Hometown democracy is a property rights issue, and would give voters final approval over land-use changes to someone else's property. This proposal gives voters final approval over how the government collects THEIR tax money.
Q: Won't we be adding a lot of government expense to running more elections?
A: Only if the local governments request frequent tax increases. Proper planning will allow for votes to occur on regularly scheduled election days.
Q: Didn't the Taxation and Budget Reform Commission reject this idea?
A: Yes, due to heavy lobbying pressure from local governments which have spent millions of taxpayer dollars fighting all attempts to cut property taxes.
