Supermajority requirements do not lower taxes or spending

/ 16 March 2012 / jennifer

Tom Hanson, Winona Daily News, Friday, March 16, 2012 –

Tom Hanson served as the Commissioner of Minnesota Management & Budget under Governor Pawlenty.

There is currently a proposal under consideration in the Minnesota Legislature that would ask voters to approve a constitutional amendment requiring a supermajority, or three-fifths of legislators, to increase state taxes. While I am a fiscal conservative who has worked hard in my career to limit government spending and cut taxes — I oppose this proposed amendment because experience has shown that it does not accomplish either of these objectives.

Other states have demonstrated that having a supermajority requirement on the books doesn’t prevent property tax increases. With these budgetary restrictions in place, it becomes harder to reach consensus on funding government priorities. These states then have to look for other ways to provide these services, so oftentimes, the costs are shifted down to the local level. Between 2000 and 2009, the nine states with supermajority constitutional amendments similar to what is being proposed in Minnesota saw their property taxes increase by 22 percent. Other states saw just a 13 percent increase in property taxes during that same timeframe.

Several other states with supermajority requirements have also seen their bond rating correspondingly downgraded, making it more expensive for their taxpayers to borrow. Moody’s Investor Services downgraded both Arizona and Nevada’s bond rating, observing that a supermajority requirement “presents a hurdle to achieve balance on an ongoing basis moving forward.”

Further, states that adopt supermajority constitutional amendments are likely to see an increase in political gridlock and budgeting through the constitution. When the Legislature cannot come to a budget agreement, proposed expenditures are sent to the voters for approval. Legislators are paid by Minnesota taxpayers to set the state’s budget— they shouldn’t abdicate that responsibility to the voters who pay their salaries. The last thing Minnesota needs is to be more like California, with its recurrent budget deficits and countless ballot initiatives in every election. Budget decisions should be carefully considered by lawmakers, not driven by expensive political ad campaigns.

In a recent analysis of the proposed supermajority constitutional amendment, the Minnesota Taxpayers Association stated, “A 2009 study examining the revenue impact of supermajority requirements found no statistically significant impact on the growth in sales taxes, income taxes, total revenue or total revenue per capita.” They also found that states with supermajority rules “do not tax or spend on general projects different than states without them.”

While I agree wholeheartedly with the intentions behind a supermajority constitutional amendment — holding the line on taxing and spending — it’s important that lawmakers observe the effects these requirements have had in other states. It didn’t work well for them, and it likely won’t work well for us. I urge Minnesota legislators to vote no on this proposal.

Tom Hanson served as the Commissioner of Minnesota Management & Budget under Governor Pawlenty.