The Associated Press
With politicians wary of approving election-year tax hikes, some cash-strapped state and local governments are resorting to pass-the-buck tactics: asking voters to decide for themselves whether taxes should go up. In Washington state, a Nov. 5 referendum proposes raising the gasoline tax by 9 cents a gallon to finance highway construction and transit projects. Oregonians will decide in January whether to endure a 5-percent income tax increase for three years to plug the majority of a $482-million budget hole.
In two regions of Virginia – suburban counties near Washington, D.C., and the Hampton Roads area around Norfolk – voters will consider sales tax increases on Election Day that would raise about $11 billion for transportation projects. The enticement in each case is potential easing of traffic congestion in areas inhabited by 3.4 million people, nearly half the state’s residents.
Voters in three Florida counties, including Miami-Dade, face similar choices – whether to raise sales taxes and spend the money on roads and schools. Wyoming’s Park County seeks a 1-cent sales tax hike to build a jail. In Oregon and Washington, both sides of the tax debate view the stakes as momentous.
Oregon Gov. John Kitzhaber, who favors the temporary income tax hike, has signed a contingency bill that would slash spending by $310 million if the proposal is defeated. Schools would lose $95 million, social services $67 million.
“These cuts are devastating to Oregon’s ability to educate children, care for the frail and elderly, protect citizens and incarcerate criminals,” Kitzhaber said.
However, Oregon voters have rejected other proposed tax increases in recent years, while approving limits on property taxes.
“People might hold their nose and vote for an income tax increase,” said Portland pollster Tim Hibbitts, “but it’s going to be an uphill fight.”
In Washington, supporters of the gasoline tax hike say this could be the last realistic chance for years to finance badly needed transit improvements. “The roads will not get fixed on their own,” said Gov. Gary Locke. “The solution won’t get any cheaper.”
The plan would raise the gas tax from 23 cents to 32 cents per gallon, place a 1 percent surtax on vehicle sales, and increase trucking fees 30 percent. Most of the projected $7.7 billion in revenue would go for highways; some would support ferries, rail and mass transit.
To allay public doubts, the proposal calls for regular audits of each project.
“The No. 1 reason for opponents voting ‘no’ is they doubt the ability of state government to spend money effectively,” said pollster Stuart Elway, whose latest survey shows the proposal in trouble.
The measure is opposed by anti-tax activists and also by environmentalists, who have suggested a cheaper, more conservation-friendly transit plan.
“The ultimate question is, ‘Do you trust these guys?'” said Tim Eyman, a leader of Washington’s anti-tax movement. “If you think they’re going to flush the money down the toilet, you don’t want to give them anything.”
Arturo Perez, a fiscal analyst with the Denver-based National Conference of State Legislatures, said few legislatures raised taxes this year – other than on tobacco – despite pervasive budget deficits.
“Most states stayed away from any discussion of it, much less a vote,” he said. “It’s an election year.”
Perez said Washington’s gas tax measure follows a recent trend of proposing specific uses for new tax revenue.
“The days are gone of simply saying to voters, ‘We’re going to raise your taxes X percent – trust us how to spend it,'” Perez said.
Jonathan Collegio of the conservative Americans for Tax Reform said voters should be wary of requests to raise their own taxes, even for ostensibly brief periods.
“Often legislators find it difficult to wean themselves from the cash,” he said. “Passing the buck is cowardly. They’re not attacking the root of the problem, which is spending.”
Recent results show mixed outcomes when voters consider self-imposed taxes. During Florida’s September primary, eight of nine local sales tax increases were approved. In August, Missouri voters defeated a proposal to raise $500 million annually for transportation projects through higher sales and motor-fuel taxes.
Unlike several recent nationwide elections, few tax-cutting proposals are on state or local ballots this year.
Arkansas voters will have a chance to eliminate the state’s sales tax on food and medicine, which critics say is unfair to the poor. Opponents of the measure say it would devastate government programs because it doesn’t compensate for $435 million in lost revenue.
The Massachusetts ballot includes a proposal to eliminate the state income tax. Even if it passes, however, the Legislature could kill it.
On the Net:
National Conference of State Legislatures: http://www.ncsl.org
Headline: Skirting a risky vote, some politicians ask voters to impose tax hikes on themselves
Creation Date: 10/24/2002 14:18:41 Submit Date: 10/24/2002 14:33:12
By Line: By DAVID CRARY Title: AP National Writer
Object Name: SELF IMPOSED TAXES, BJT
Source: The Associated Press Credit:
File Type: text/xml