ACTION 22, INC.

RESOLUTION

SUPPORT AMENDING TABOR

WHEREAS, the “Taxpayer’s Bill of Rights” (TABOR) requires voter approval of any new tax, tax rate increase, debt increase, increase in mill levies, and any tax policy change that will result in a net revenue gain, and

WHEREAS, TABOR limits the amount of revenue the state is able to keep and spend, and

WHEREAS, a ratchet-down effect occurs because TABOR sets each year’s base as the “lesser of” actual revenues or allowed revenues – to which the growth formula of inflation plus population is applied, and

WHEREAS, if in any year the state receives less than it is allowed to under the formula, it has to use the lower amount as its base when the next year’s formula is calculated, and

WHEREAS, TABOR contains a clause that does not allow any other tax or spending limits – either statutory or constitutional – to be weakened without a vote of the people. This constitutionalizes the statutory Arveschoug-Bird limit – a provision that limits state General Fund appropriations to a growth rate of 6%.

WHEREAS, without restrictions the cost of governments can grow faster than their relative economies, thus placing an increasing tax burden on citizenry, and

WHEREAS, it is necessary to balance restrictions on government growth with the flexibility necessary for elected officials to respond to taxpayer needs in times of fluctuating economic conditions, and

WHEREAS, the basic premise of TABOR was to allow a vote by the people on all revenue or taxing issues, TABOR actually has taken away that right by its prohibitions on alternative revenue sources, and

WHEREAS, as a result of complicating factors with the existing Arveschoug-Bird legislative spending restriction; the unintended “ratcheting” effect on the base in times of economic declines, TABOR places excessive restrictions on the budgets of all governmental entities in the form of an ever-decreasing revenue base; and TABOR has been interpreted to impact any and all proposed tax increases including levies, assessments and fees from any governmental entity, now

THEREFORE, BE IT RESOLVED, that Action 22 supports retaining the right of voters to approve proposed tax increases, and

BE IT FURTHER RESOLVED, that Action 22 supports efforts to amend TABOR to include one or all of the following:

  • Eliminate the ratchet effect
  • Eliminate the “weakening provision”
  • Eliminate the prohibitions on alternative revenue sources
  • Change revenue limit formula

ADOPTED THIS 14TH DAY OF NOVEMBER, 2003.

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Nicholas Gradisar, Chairman

Action 22 Board of Directors