Tax swap skirts disaster, but questions abound
A style and drafting committee of the Taxation and Budget Reform Commission just finished discussing the tax swap proposal, and while subject to many questions, the plan was spared heavy blows some critics were hoping would keep it off the November ballot.
The plan, which would eliminate the required local effort for schools and replace with other revenue sources, including a sales tax, is certainly complex and that still poses a problem.
The committee wrangled with implementation language and how to make it read that school budgets will be held completely harmless, when the provisions (including a 5 percent assessment cap for non-homestead property) would go into effect and other concerns. It also adopted bill language from a nearly identical proposal sponsored by Patricia Levesque.
Commissioner John McKay, who first had the idea, summed up the worry: "I don't want to see us put ourselves in a position where we're changing so many words that someone could challenge our product in court and on that basis, invalidate it."
The proposal will be further refined by staff and discussed at another meeting next Thursday. It must then go to back to the 25-member TBRC, which previously voted 21-4 to put it on the agenda.
Business groups, fearful of a sales tax increase, are trying to prevent the measure from going on the ballot but understand odds are against them. In that case, some are seeking to phase out the required local effort in the hopes that the Legislature can find other ways to generate the estimated $9-billion or more in lost revenue in 2011.