Challenging Property Tax Caps: The concerns that come from property taxes are neither irrational nor inexplicable. First, since housing costs consume a higher portion of low-income Americans' budgets, property taxes are regressive in nature -- hitting hardest those who can least afford them. Second, in some cases people have little control over their own property's values. External factors can drive up property values, sometimes forcing individuals to choose between paying taxes they cannot afford and leaving a home full of memories. Finally, rightwing moves across the country to cut taxes at the state level and shift costs to cities and counties have resulted in mounting property tax bills, as property taxes are one of the few revenue options that these local governments have.
Progressives can begin to challenge these tax caps by simply presenting research showing the regressive nature of property tax caps in a compelling way. A more aggressive approach played out in Montana in 2006 and 2007, where progressive Governor Brian Schweitzer put the state's rightwing on the defensive regarding their property cap proposals. Schweitzer countered the right by proposing a one-time flat rebate of $400 for every Montana resident homeowner, ensuring that virtually all Montana homeowners (more than 99%) received a larger refund without giving disproportionate gains to rich landowners or out-of-state corporate property owners.
Fighting TABOR: One of the most disastrous tax policies in recent decades was Colorado voters' approval of the so-called Taxpayer Bill Of Rights (TABOR) in the early 1990s. The TABOR created a rigid cap on increases in state spending tied to inflation and economic growth, decimating the state's investments in education, health care, and social services. Voters partially repealed the TABOR tax limits in a referendum in 2005, but not before Colorado had fallen to 47th in the nation in K-12 education funding as a share of state income and 50th in the nation in immunization rates. The repeal campaign successfully tapped voters' desire to invest in those human needs and highlighted the damages from such rigid tax rules.
Despite strong funding for similar measures in 2006 by people like super-wealthy New York developer Howard Rich, a strong funder of rightwing causes, all those measures failed that year due to mobilization by progressive forces. In Michigan, Montana, Nevada, Oklahoma, and Missouri, anti-TABOR forces were able to reveal so much fraud in the initiative's wording or signature collection process that state judges and other administrative bodies blocked the measures from the ballot. In Maine, the one state where the initiative went to voters, it was rejected after opponents highlighted the damage TABOR had done in Colorado.
How Tax "Limitation" Laws Entrench Tax Loopholes: One other dangerous form of tax limitation laws are rules that require supermajorities to pass any tax increase. In such cases, special interests may be able to enact a tax break for themselves with a simple majority, but then can often block repeal of the tax loophole as a "tax increase" that can be blocked by a minority of legislators The Center on Budget Policy and Priorities outlined this problem in an analysis of a Kansas proposal to require a supermajority to raise revenue in that state, emphasizing how so-called "taxpayer rights" laws are often just special interest protection legislation in disguise.
- Progressive States Network - Winning on Property Taxes: The Montana Model for Progressives
- Progressive States Network - Rightwing Fraud Derails Tax Revolt
- Center for Budget and Policy Priorities - The Problems with Property Tax Caps
- Progressive States Network - The Taxpayer Bill of Goods
- Center for Budget and Policy Priorities - What is TABOR?
- The Bell Policy Center - TABOR
- Center for American Progress - TABOR
- Center on Budget and Policy Priorities - TABOR: A Threat to Education, Health Care, and Social Services