Maine Tax Relief Initiative, Question 4 (2009)

From Ballotpedia

The Maine Tax Relief Initiative appeared on the November 3, 2009 ballot in Maine as an initiated state statute where it was defeated. It is also known as "TABOR 2" after the Maine Taxpayer Bill of Rights (2006), which failed to pass after 53.9% voted against the measure.^[1],^[2]

Election results

Question 4 was defeated as of November 4, 2009 at 2:05 a.m. EST.^[3]

Question 4
Result		Votes	Percentage
No		299,451	60.39%
Yes		196,442	39.61%
Total votes		495,893	100.00%
Voter turnout		54%

Ballot summary

See also: Proposed Tax Relief Act - complete language

The language that appeared on the ballot was:

Do you want to change the existing formulas that limit state and local government spending and require voter approval by referendum for spending over those limits and for increases in state taxes?^[4]

Specific provisions

This initiated bill sought to impose expenditure limitations on state and local government and require voter approval of certain state tax increases.

Under the proposed bill:^[5]

• growth in annual expenditures of the General Fund, the Highway Fund and Other Special Revenue Funds are limited according to increases in population and inflation
• revenues exceeding the expenditure limitation must be distributed by directing 20% of that excess to a budget stabilization fund and 80% of that excess to a tax relief fund
  • the budget stabilization funds may be used only in years when revenues are not sufficient to fund the level of expenditure permitted by the growth limits
  • the Tax Relief Reserve Fund must be used to provide tax relief through broad-based tax rate reductions or refunds proportional to individual income tax personal exemptions claimed in the previous tax year
  • the Highway Fund Reserve Fund must be used to provide a decrease in motor fuel taxes
• managers of Special Revenue Funds must report excess surpluses to the Legislature with a plan for refund of those revenues
• a state tax increase would require a majority vote of each House of the Legislature and majority approval of the voters

Supporters

TABOR 2 was sponsored by David Crocker, an attorney in Portland, Maine Leads, a citizen action group, and others who came together and formed a coalition called TABOR Now.

When the Maine Secretary of State announced that the tax relief initiative had qualified for the November ballot, Crocker released a statement that said, "The TABOR NOW initiative is about giving Maine citizens a greater voice in the debate over how their hard-earned income is taxed and spent by politicians. Politicians have refused to create real tax relief and have continued to squander opportunities for positive change. It's time for we, the people to rise up and create the relief we know will create new jobs and strengthen our families during these challenging economic times."^[6]

Maine Merchants Association

On September 28, 2009 the Maine Merchants Association voiced their support for Question 4. Executive Director Curtis Picard said,"Orr retailers and merchants continue to be concerned about the level of spending that occurs here in Maine, and LD 1, although it was well-intentioned, didn't quite have the teeth to it that everybody anticipated it would, and they're hopeful that this TABOR initiative is different from the first one, and is a step in the right direction." The organization came to the decision after discussing the proposed spending levels.^[7]

Maine Chamber of Commerce

The Maine State Chamber of Commerce withdrew its support for Question 4 on September 22, 2009. Five months prior, the chamber supported the measure before the legislative policy committee. According to chamber officials the business organization was unable to reach a consensus position on Question 4. "When you have a complex, challenging policy like this is, it is very difficult in a referendum process that only allows you a 'yes' or a 'no' to reconcile those challenges," said Conners. The chamber opposed a similar TABOR bill in 2006. However, the chamber as a whole did not ultimately support or oppose the 2009 measure.^[8]

National Taxpayers Union

The National Taxpayers Union supported Question 4. According to the organization, Question 4 was "arguably the most important ballot item in this year’s election, nationwide. It will serve as a model for other states wishing to return to a path of fiscal responsibility, prosperity, and citizen involvement in their government." Additionally, NTU argued that the measure would ensure that government grows at a manageable rate and protects taxpayers from the endless cycles of budget deficits and higher taxes. The measure was included in NTU's 2009 General Election Ballot Guide. A website in support of Question 4 called Maine 4 Taxpayers was a site sponsored by the National Taxpayers Union, as well as a coalition of taxpayers and policy advocates.^[9]

Portland Regional Chamber

On October 7, 2009 the Portland Regional Chamber, Maine’s largest business organization, announced its support for TABOR II. Chamber CEO Godfrey Wood said, "The vote to support TABOR II was over 60%, consistent with the organization’s longstanding history of supporting broad tax reform and relief, and limiting the growth of government spending at all levels of government."^[10]

Online property tax calculator

In October 2009 the Maine Heritage Policy Center launched a new online tool on their website www.maineopengov.org that allowed for Mainers to "compare spending in their town versus spending in other towns." The policy center said that they hoped the new online tool helped shed some light on local spending. "We want citizens of those towns to go in and say, wait a second, my town is the same size as this town but we're spending twice as much what's going on," said Michael Bowden of the Heritage Policy Center. ^[11]

• Maine Heritage Policy Center's online local property tax calculator can be found here.

Opponents

Organized opposition to the initiative came from a group called Maine Can Do Better. The group was led by Ben Dudley, who once chaired the Democratic Party in Maine.^[6] Official campaign coalition is called No on TABOR.

When it became clear that the initiative's sponsors had collected enough signatures to qualify for the ballot, the opposing group released a statement saying, "We are disappointed to see TABOR return to the ballot after its rejection by Maine voters in 2006. TABOR's rigid, one-size-fits-all mandate on state and local spending will make it even more difficult to rebuild our economy. The proposal regarding auto excise taxes is equally ill-conceived. It will put a stranglehold on cities and towns and further limit our ability to address infrastructure needs. Both proposals simply run counter to the win-win strategy of stimulating the economy while preserving and growing jobs."^[6]

Individual groups that opposed the measure included, according to Maine Can Do Better:^[12]

South Portland City Council

On Monday, October 5, the South Portland City Council voted unanimously to oppose Question 4. According to reports, council members said they were concerned about TABOR's limitations on state and municipal budgets, which they said could affect roads and emergency situations. “The biggest impact on Maine and most people is the highway. The city, this year, ended up paving some roads the state should be paving,” said Councilor James Hughes.^[14]

Maine Education Association

The Maine Education Association (MEA) was opposed to Question 4. "We're going to fight the people that want to cut funding to education in the state," said Chris Galgay, the MEA president. In the past, MEA has opposed tax cap proposals, including those proposed in 2004 and 2006. Despite the arguments that approval of Question 4 would lead to a decrease in funding for education, MEA officials argued that TABOR 2 would not restrict state spending but instead increase it over time.^[15]

Attorney General Janet Mills

On October 29, 2009 during a visit to the University of Maine Attorney General Janet Mills announced that she would be voting against TABOR II. She said, speaking as a former legislator and not as the state attorney general, "I think it [TABOR II] is burdensome and unnecessary. I just don’t think we need a state-wide campaign every time there needs to be a tax expenditure."^[16]

Donors

See also: Campaign finance requirements for Maine ballot measures

Supporters

Committee groups that contributed to the "Yes on 4" campaign included:^[17]

• TABOR Now (PAC)
• Maine Leads (BQC)
• Maine Heritage Policy Center (BQC)

Contributions

In support of TABOR II, the campaign raised approximately $217,523, according to October 2009 reports.^[18]

Below is a chart that outlines major cash contributions to the Yes on Question 4 campaign:^[18]

Contributor	Amount
TABOR Now	$159,096.26[19]
Maine Leads	$16,387.56[20]
Maine Heritage Policy Center	$42,040.59[21]

Opponents

Committee groups that contributed to the "No on 4" campaign included:^[17]

• Citizens Unified for Maine’s Future (PAC)
• Maine Center for Economic Policy (BQC)
• Maine People’s Resource Center (BQC)
• Center on Budget and Policy Priorities (BQC)

Prior to publishing a report against TABOR II, the Center on Budget and Policy Priorities (CBPP) filed paperwork with the state of Maine to be identified as a ballot question committee opposing Question 4. The primary CBPP individuals identified in the paperwork include: Robb Gray, Iris Lav and Scott Bunton. The paperwork was officially received by the state on September 14, 2009.^[22]

Contributions

In opposition of TABOR II, Citizens Unified for Maine's Future campaign raised a total of $1,695,895.00 in cash and spent $1,291,780.03, according to October 2009 reports.^[23]

Below is a chart that outlines major cash contributions to the Citizens Unified for Maine's Future:^[23]

Contributor	Amount
Citizens Who Support our Schools PAC	$557,600
Donald Sussman (investment manager of Trust Asset Management LLP)	$370,000
Maine Municipal Association	$140,000
Service Employees International Union (SEIU), Washington D.C.	$100,000
Maine State Employees Association, SEIU	$10,000

Media editorial positions

Main article: Endorsements of Maine ballot measures, 2009

Editorial boards in support

• The Sun Journal supported Question 4. In an editorial the board said, "There is no perfect time for TABOR. Yes, the revenue projections for the state are dismal: yet another $200 million needs to be found in the budget, according to latest calculations, in the next round of bloodletting that has passed for budgeting in Augusta recently.Blame the economic downturn for this. But also blame the lack of foresight by policymakers in restraining spending during boom times. For years, the message has been clearly sent to the State House that what's coming out is not commensurate with what's going in. It's too much."^[24]

Editorial boards opposed

• The Bangor Daily News opposed Question 4. They said,"Putting government on a strict diet is an attractive scenario. But the problem with this approach is that what looks like a diet is in fact more like stomach stapling, a radical and risky procedure. The reasons for rejecting TABOR II are the same reasons similar measures were defeated by Maine voters in 2004 and 2006. Limiting government spending in this manner means a sweeping change to the nature of our representative government."^[25]

• The Kennebec Journal/Morning Sentinel opposed Question 4. In an editorial, they said,"Passing TABOR would take away the ability of our representative government to function, and give a mathematical formula more power than the collective will of the people, as expressed through the election of their representatives. That's why we urge a 'no' vote on Question 4."^[26]

• The Seacoast Media Group opposed Question 4. They said,"State voters in their wisdom rejected the Taxpayer Bill of Rights before; we urge people to remain firm in their opposition this time around. Under TABOR II, Maine government will only be allowed to grow by a formula based on the inflation rate, plus the rate of population growth. And the base year is 2010, by any standard a terrible economic period."^[27]

• The Brunswick Times Record opposed Question 4. They said,"We encourage a decisive “No” vote on Question 4. Perhaps then, the Maine Heritage Policy Center and other TABOR proponents, funded largely by out-of-state interests, will get the message they apparently failed to understand from our state’s two previous rejections of this measure: Three strikes and you’re OUT!"^[28]

Path to the ballot

Although the petition to qualify the measure for the ballot was circulated beginning early in 2008, it missed the deadline to appear on the November 2008 ballot, but made the deadline to appear on the November 2009 ballot.^{[29] [30]} The filing deadline for the November ballot was January 22, 2009. The number of valid signatures required was 55,087 (10% of the total votes cast for Governor at the November 7, 2006 election).

Polling information

See also: Polls, 2009 ballot measures

• An Oct. 31 - Nov. 1 poll by Public Policy Polling revealed that 39% of voters said they were in favor of Question 4, whereas 57% said they were opposed and 4% remain undecided. Approximately 1,133 voters were surveyed. The poll has a +/-2.9% margin of error.^{[31] [32]}

• According to a poll conducted from October 23-26 by Critical Insights revealed that 47% of voters are in favor of Question 4, while 45% are opposed and 8% remain undecided. They polled a total of 600 registered voters. The data was released at an October 28 press conference by TABOR Now.^{[33] [34]}

• A poll released October 27, 2009 by Pan Atlantic SMS Services revealed that 42% of voters are in favor of Question 4, whereas 49% are opposed and 10% are undecided. Approximately 400 voters were polled. The poll is reported to have a +/- 4.9% margin of error.^{[35] [36]}

• A poll conducted from September 30 - October 7 by Pan Atlantic SMS Services revealed that 53% of voters are in favor of Question 4, whereas 39% are opposed and 8.5% are undecided.^{[37] [38]}

Date of Poll	Pollster	In favor	Opposed	Undecided
Sept. 30 - Oct. 7	Pan Atlantic SMS Services	53%	39%	8.5%
Oct. 20 - 22	Pan Atlantic SMS Services	42%	49%	10%
Oct. 23 - 26	Critical Insights poll	47%	45%	8%
Oct. 31 - Nov. 1	Public Policy Polling	39%	57%	4%

News opinion poll

• In a non-scientific opinion poll conducted October 23, 2009 by the Bangor Daily News, they asked: "Do you think TABOR II would adversely affect education in Maine?" Approximately 55% (322 votes) said "yes," while 45% (263 votes) said "no."^[39]

Reports on TABOR II

Center on Budget and Policy Priorities

On September 22, 2009 the Center on Budget and Policy Priorities released a report, written by Catherine Collins and Iris Lav, analyzing the possible effects of TABOR II. In their analysis, the "nonpartisan public policy center" concluded that TABOR II will "endangers public services and business climate." According to the center TABOR II is scheduled to go into effect before the state fully recovers from the recession - an move that "undermine state and local services in Maine in much the same way that Colorado experienced under its TABOR." The report adds that Colorado's experience has resulted in a drop in the state's education spending and should serve as a warning for Maine.^[40]

The report also explained that despite supporters' arguments that Maine is in need of greater control on spending, Maine has been relatively stable on spending. Specifically they addressed 2005's "LD1" legislation which imposed constraints on spending throughout several government levels (i.e. state, county and school district). The 2005 legislation, says the report, has resulted in slower government spending growth.^[40]

"The rigid limit in TABOR II goes too far. It would prevent the state from restoring cuts made during the recession and from making adequate investments in education, health care, environmental quality and infrastructure. The decline in services would hamper efforts to improve the state’s business climate and competitiveness," reads the report.^[41]

Response to report

David Crocker, chairman of TABOR NOW, said that the report's statements were misleading. Specifically Crocker refered to the center's arguments that Colorado's 2005 vote to loosen some of TABOR's restrictions should be indicative of the Question 4's possible impact on the state. However, Crocker argued that in 2005 the state of Colorado did not eliminate TABOR, they simply suspended the restrictions during an economic downturn. Additionally, Crocker noted that despite arguments that education spending in Colorado has decreased, the state is "more prosperous" because of it's "business-friendly policies."^[41]

American Legislative Exchange Council

In March 2009 the American Legislative Exchange Council released a second edition of "Rich States, Poor States: ALEC-Laffer State Economic Competitiveness Index." According to the "nonpartisan association's" report, Maine ranked 47th in the nation in economic outlook and 24th in economic performance. Additionally, Maine ranked poorly in personal income tax rate, total property tax burden, inheritance-estate tax and average workers’ compensation costs.^[42] Jonathan Williams, one of the report's authors, said in October 2009 that the state of Maine will in fact benefit from TABOR or some form of government spending restrictions.^[43]

Response to report

TABOR opponents argued that the report is based solely on income and sales taxes which in Maine are scheduled to be phased out in 2010 under a restructuring bill, which they argue will help reduce the tax burden on Mainers. However, Williams noted that the bill "just shifts around the taxes" and will not help Maine's national rank.^{[42] [44]}

TABOR in Colorado

See also: TABOR, Colorado example

TABOR was approved in Colorado in 1992. In 2000 an amendment to Amendment 23 required education spending to increase and in 2005 voters approved a ballot measure that loosened many of TABOR's restrictions. However, in 2008 voters rejected Colorado Initiative 126, also known as Amendment 59, which would have extended the 2005 amendment which is scheduled to end in 2010. In 2009 Gov. Bill Ritter announced that he is currently working with groups to propose an initiative that addresses eliminating portions of TABOR for the 2011 state ballot.

Opponents of Question 4 argued that the state of Colorado has suffered in light of TABOR and the limits in government the 1992 act imposed. However, some Coloradoans argue otherwise. "Nothing could be further from the truth," said Barry Poulson,Senior Fellow in Fiscal Policy at the Independence Institute. According to Poulson TABOR helps strengthen fiscal rules and policies "conducive to economic growth and prosperity, and prevents the kind of fiscal debacle occurring in California."^[45]

South Portland City Council complaint

In mid-October the state Ethics Commission launched an investigation into the South Portland City Council, after the TABOR 2 campaign filed a complaint over a city decision to include a mailer with its property tax bills. The approved mailer urged citizens to oppose two ballot measures scheduled to appear on the November 3, 2009 ballot - Question 2 and Question 4.^[46] "We were deeply concerned that the city was using taxpayers' money to not very subtly tell taxpayers how to vote on these two referenda," said David Crocker, Question 2 campaign chairman. The Ethics Commission said that they will consider a formal investigation on November 19, however, the city of South Portland is required to submit a written response by October 30, 2009.^[47]

Legislature investigation

Supporters of Maine's Question 4, better known as TABOR 2, asked the Maine Attorney General for an investigation into Senate President Elizabeth Mitchell and House Speaker Hannah Pingree's use of staff and positions to oppose the November 2009 ballot measure. "Is it appropriate for the presiding officers to have this sort of meeting where in effect it appears that threats are made and promises given at the same time," said David Crocker, chairman of TABOR Now, on Monday.^[48] The allegations were made after supporters obtained a series of e-mails and information regarding a "closed-door meeting." They argue that the evidence obtained reveals a clear violation of state law.^[49] TABOR supporters specifically point to an e-mail from Rick McCarthy, a lobbyist for Maine Tomorrow and former staffer for a state legislator, to a Pingree staffer in which McCarthy said that "20 people at the meeting and that 'ultimately we hope to raise funds from them.'" However, both legislators deny any solicitation of funds and said they were surprised by the allegations.^[50]

Attorney General dismisses complaint

Attorney General Janet Mills dismissed the complaint, citing that they hadn't provided sufficient evidence of wrongdoing to warrant an investigation. "We do not initiate investigations in this office unless and until there's a threshold of something to investigate. There's absolutely no suggestion there's any criminal activity," said Mills. Tarren Bragdon, executive director of the Maine Heritage Policy Center, said that he was surprised by the quick dismissal.^[50]

Despite the attorney general's response, campaign supporters said they plan to continue the pursuit of an investigation with the state ethics commission.

Other TABOR measures

Colorado Taxpayer Bill of Rights Act (1992)
Maine Taxpayer Bill of Rights Initiative (2006)

• Washington Initiative 1033 (2009)

See also

Articles

Interviews

External links

Organizations

Additional reading

Editorials

Reports

• Center on Budget Policy Priorities,"Maine’s “TABOR II” Repeats Mistakes of Colorado, Endangers Public Services and Business Climate," September 22, 2009

Audio clips

• Maine Public Broadcasting Network,"The Debate Over Tabor II," October 15, 2009

References

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