Measures To Limit Tax Rates Lose In Four States

By Anne Bridgman — November 14, 1984 8 min read

Voters in four states last week defeated property-tax-limitation ballot measures that educators had claimed would cripple their school systems if approved.

And in a number of other states, voters approved education-related ballot items, suggesting a high level of local support for public schools.

In California, Michigan, and Nevada, voters defeated initiatives that would have limited tax levels and prohibited state lawmakers from raising taxes without either a majority legislative vote or a public referendum. Early returns showed a similar measure was also failing in Oregon.

In all four states, the measures, while not directly related to education, were expected to threaten school funding funding by forcing legislators to choose between financing education and other programs.

“Traditionally, of the tough tax propositions, and I think those four you can put in that broad category, only about 25 percent tend to pass,” said Patrick B. McGuigan, editor of Initiative and Referendum Report, which is published by the Institute for Government and Politics. The institute is a division of the Free Congress Foundation, a public-policy-research organization based in Washington, D.C.

“You would have expected that at least one of those would have sneaked in,” Mr. McGuigan said. “And the fact that not one of those did, there’s a message there. The message is not that the tax revolt is dead. The tax revolt is alive as long as you get it on the ballot. But is the public buying it? This year they’re not.”

“Voters are saying, ‘We don’t necessarily want to have taxes go up ... but we’re content with the way things are.’ ... Voters feel they can live with the present levels of taxation.”

But Mr. McGuigan said that “voters will go into orbit if state legislators misread the message and try to push tax increases.”

Jarvis Measure Defeated

In California, Proposition 36 was opposed by 55 percent of voters, while 45 percent backed it. The measure, which was sponsored by a state legislator named Howard Jarvis, sought to reinforce and extend Mr. Jarvis’s Proposition 13, a tax rollback approved by voters in 1978.

The state’s legislative analyst has estimated that if the proposition had been approved, school districts could have lost property-tax revenues of up to $750 million from 1984 to 1986, and $150 million annually thereafter.

“The reports generally are that voters felt that Proposition 13 had been successful in reducing property taxes and that further reductions were not necessary,” said Katie Mason, a research consultant with the nonpartisan California Coalition for Fair School Finance.

In addition, she said, Gov. George Deukmejian came out against the measure the Saturday before Election Day, which may have influenced some of the many undecided voters.

Following the measure’s defeat, Mr. Jarvis said he would return with a similar proposition in the near future, Ms. Mason said.

‘Voter’s Choice’

In Michigan, voters defeated Proposition C by a margin of 20 percentage points. The measure, also called the “Voters’ Choice Initiative,” would have rolled back all state and many local property taxes to their December 1981 levels, and would have required voter approval of all future increases, with the exception of local taxes that have already been approved by voters.

Education leaders in Michigan, including members of the state board of education and Superintendent of Public Instruction Phillip E. Runkel, had argued before the election that the plan would result in a drop of $435 million to $500 million in support for elementary and secondary schools.

“Superintendent Runkel was certainly very pleased that the voters chose to reject the proposal, which would have had a significant effect on state and local support for public education,” said Thomas Farrell, a spokesman for the state department of education. “Obviously, the voters don’t want to take that approach to reducing government expenditures.”

Supporters of Proposition C have indicated an interest in resurrecting the initiative for the 1986 elections, according to state officials.

Narrow Defeat in Nevada

In Nevada, voters narrowly defeated Question 12, a property-tax-limitation measure that would have made tax increases subject to approval by two-thirds of the state legislature or of a local governing body, plus popular approval at the next general or special election.

Gov. Richard H. Bryan, a number of educators, and the state board of education campaigned against the measure, which was voted down by a margin of four percentage points, 52 percent to 48 percent, according to the Nevada Secretary of State’s office.

“The vote indicated that the campaign and the various groups that spoke out against the measure were effective,” said Karen Galatz, an aide to Governor Bryan who termed the result “a victory for common sense.”

“The message that there was profound potential danger to education was made clear,” she said.

Ballot Measure 2

And in Oregon, preliminary election results put Ballot Measure 2, the “Constitutional Real Property Tax Limit,” behind by 19,000 votes, according to the Oregon Secretary of State’s office. At that time, however, 50,000 absentee ballots had not been counted and 40 precincts had not reported their tallies.

Ballot Measure 2 would have limited property taxes to $15 per $1,000 of assessed valuation, would have rolled back assessments to 1981 levels, and would have restricted growth to 2 percent per year.

Gov. Victor G. Atiyeh, educators, and the Oregon Committee, formed to oppose the measure, charged that it would have taken $700 million out of elementary and secondary education in Oregon.

The apparent defeat of the measure, according to Mark Nelson, director of the Oregon Committee, “says that, by a very narrow margin, the people of Oregon are not willing to pass a measure that would cut local government off at its knees.”

“It has saved education funding in the state for the meantime,” Mr. Nelson said, but he warned that unless the legislature enacts a sales tax dedicated to public elementary and secondary education or some sort of income-tax relief, Oregonians “will pass the draconian type of measure that will cripple education.”

Verne A. Duncan, superintendent of public instruction, agreed with Mr. Nelson. “We may have just won the measure narrowly,” he said, describing Ballot Measure 2 as a plan that would have “absolutely devastated schools.”

But he also noted the need for property-tax relief in Oregon and said the supporters and opponents of the ballot measure have already begun to work together to develop a compromise tax-relief measure to present to the state legislature in January.

Measures Approved

Of the six ballot initiatives in five states that dealt with increased funds for public schools, five were approved by voters.

The initiative defeated by voters was a “better-schools” amendment in West Virginia that would have provided for a statewide excess school levy and would have established a dedicated 1-cent sales tax for school construction and repair.

One of the most controversial of the approved initiatives was Proposition 37 in California, which will amend the state constitution to allow a lottery with a minimum of 34 percent of all proceeds going to education.

Proponents of the measure said before the election that the lottery could bring in $1.7 billion in the first year. Opponents, including Governor Deukmejian, lobbied against3the proposition on the grounds that a lottery is not a stable source of income and could lead to a decline in state aid in future years.

Voluntary Prayer

In West Virginia, a constitutional amendment that enjoyed 70-percent support in pre-election public-opinion polls was approved by 78 percent of the voters.

The measure, which takes effect as soon as the state ratifies the election returns this month, will allow “voluntary contemplation, meditation, or prayer in schools” for those students who wish to use such time. School boards will be required to implement the measure, which calls for teachers to define the length of the period of contemplation, according to state officials.

Ohio Levies

In local elections, Ohio citizens voted on 87 operating levies, 48 capital/permanent improvement issues, 28 bond issues, and 2 operating issues combined with capital improvement or building issues.

Of those, 92 were approved in the election, for a 54.4-percent approval rate, according to Irene G. Bandy, Ohio’s assistant superintendent for public instruction.

State education officials expressed concern before the election that the local measures could be endangered by the decision in 1983 to allocate 30-to-40 percent of state-lottery funds to education. That move, they said, could have prompted voters to vote against school levies on the basis of the mistaken belief that the lottery provides sufficient funds for education.

“This is the best showing in a November general election that we’ve had in 10 years,” Ms. Bandy said. “We believe this is an indication that Ohio voters understand the importance of local support for public schools.”

Local districts will decide in the coming months whether to resubmit to the voters the levies and bond issues that were defeated, Ms. Bandy said. The next general election is next November; special elections are scheduled for February, May, and August.

And in Oregon, voters in five of the eight school districts that held levy elections last week to balance their 1984-85 budgets approved the levies, according to Robert Jones, research analyst in the state department of education. Voters in two districts defeated the levy measures, and ballots are still being counted in a close election in another district, Mr. Jones said.

A version of this article appeared in the November 14, 1984 edition of Education Week as Measures To Limit Tax Rates Lose In Four States