HomeMy WebLinkAboutCity Council Packet 03-11-1998 SpecialY
PLYMOUTH CITY COUNCIL
SPECIAL MEETING
MARCH 11, 1998
7:00 PM
Council Chambers
I. Presentation on Supermajority Proposal
II. General Discussion on Supermajority Proposal
Agenda Number:
TO: Mayor and City Council
Plymouth Charter Commission
FROM: Dwight Johnson, City Manager; Kathy Lueckert, Assistant City
Manager
SUBJECT: Information for March 11 Special City Council Meeting
on the Supermajority Issue
DATE: March 6, 1998 for March 11, 1998 Special City Council Meeting
On March 11, you have established a special city council meeting to discuss the proposed
amendment to the Plymouth City Charter which would require a supermajority (5/7) vote of
the City Council to increase the tax rate. You have invited the Plymouth Charter Commission
to participate in the meeting. This meeting will be videotaped for later rebroadcast. We have
devised a seating arrangement for both the council and the charter commission which we think
will work adequately for both camera and sound. The Council will sit at the dais in the usual
seats, and the Charter Commission will sit in front of the dais. Microphones will be available
for Charter Commission members who wish to speak.
Your packet includes background information for your use.
General information about the budget and tax rate and how it is established.
A summary of the major issues involved in the supermajority proposal, with pros and
cons. These issues were gleaned by staff from outside sources and from points made by
the council and the charter commission on the supermajority question. Please note that the
italicized print indicate those points which are specific to Plymouth. On a number of
occasions, arguments made in our local debate are identical to points found in our
literature search. In such cases, only the local argument is included.
A memorandum from the City Attorney outlining what actions could be taken by each
body at this time and the procedural requirements for doing so.
The complete public record to date of discussions on the supermajority issue by both the
City Council and the Charter Commission, and related information.
0 Articles on the supermajority question (both pro and con) from an Internet search.
We have attempted to present these issues and the pros and cons as neutrally and objectively as
possible. No inference should be made if there are either more pros or more cons for any
particular issue. Beyond these arguments are additional, even less tangible issues, such as the
psychological impact if the voters approve the measure. In any case, we hope that this
information consolidates much of the debate that has occurred over the last two years, and
provides a beginning reference point for others who become interested in the issue.
The Tax Rate
What it is and how it works
After a long process, the City staff recommends a budget to the Council in late July.
After subtracting miscellaneous revenues from the proposed expenditures, the amount
of taxes requested is determined.
The property tax typically represents about 70% of General Fund Revenues, but only
about 30% of City-wide revenues.
The city does not legally establish a tax rate. It does establish the dollar amount of
the taxes to be raised.
The tax rate is the dollar amount of taxes to be raised divided by the tax capacity of
the city:
Tax Rate = Taxes to be raised/Tax capacity of city
The tax rate can only be estimated during the budget process because the State adjusts
railroads and utilities later in the year and property owners have the right to
homestead their property through the end of the year. The final tax rate is actually
established by the County in February of the following year and may vary somewhat
from the tax rate estimated for the City Council.
The Council has substantial, but limited control of the numerator (the amount of tax
dollars to request to raise). A major limitation is state levy limits, which place a cap
on the dollar amount of taxes that can be requested to be raised.
The Council has no direct control over the denominator (the tax capacity value of the
City). Some of the factors that control the tax capacity calculation include: state
legislation on tax classification rates, economic conditions, natural disasters, fiscal
disparities and tax abatement.
Under the supermajority amendment, approving a budget and levy which increases
the tax rate will require a 5/7 vote of the city council. If one or more members are
absent or seats are vacant, the vote could be tabled until the next regular meeting
when councilmembers would be present, or a special council meeting could be called
when councilmembers could be present.
If a new levy and budget are not established by the end of December of each year, the
current year's levy remains in effect.
Issue: Should there be a higher standard, such as supermajority
vote requirement, for increasing taxes?
Pro:
It should be difficult to raise taxes.
Elected officials tend to be biased in favor of tax increases without a higher vote
requirement.
The power to tax is the power to spend.
A supermajority vote requirement sends a strong message to voters that increasing
taxes is a serious decision.
Increasing taxes is as important a decision as a rezoning.
Requiring a supermajority vote for a tax rate increase may help restore public trust in
elected officials and government in general.
Con:
Issues of taxation do not have the same permanence as do decisions regarding land.
Requiring a supermajority vote for a tax rate increase may mean other revenue
sources (such as user fees) are implemented, which may have the same effect as
increasing the tax rate.
A supermajority requirement for taxation purposes was considered when the charter
was originally drafted, but the concept of majority rule prevailed.
Issue: What is the best means ofprotecting future taxpayers from
unneeded taxes?
Pro:
There are continuing intrinsic pressures at all levels of government to increase taxes.
Interest groups exert pressure at all levels. In Minnesota, laws and mandates (such as
PELRA) exert pressure on the tax rate. A supermajority requirement would help
counterbalance these outside pressures.
Devolution—the shifting of service delivery from one level of governmentdown to
another level ofgovernment—is a real external threat in the future. Local
governments may be pressured by other government levels and by special interest
groups to increase taxes to assume responsibility for some services. A supermajority
requirement will make certain that decisions on assuming services are carefully
considered
Plymouth has a good record on controlling the tax rate, but it is important to make it
difficult to increase taxes in the future. A supermajority requirement will do this.
A supermajority requirement will force tough decisions on spending in the future.
Con:
Supermajority requirements may make it more difficult to achieve a balance of
revenue sources.
Plymouth does not control its own destiny, and can be impacted by changing
economic conditions and by actions at other levels ofgovernment, such as the
legislature, the county, and the court system. Elected officials must have flexibility to
deal with changes.
A combination of a supermajority requirement and an economic downturn could have
a disastrous effect on existing city services.
It is important not to be caught "with our levies down. "
Bond rating agencies do not look favorably on any actions which impact the ability of
a governing body to raise revenue. Enacting a supermajority requirement could be a
negative factor impacting Plymouth's AAA bond rating.
Devolution may mean that some citizens do not receive needed services, and this can
have ramifications on local services such as public safety. Councils should have the
flexibility to deal with specific circumstances where service delivery decisions cannot
be made solely on numbers alone.
Issue: Majority Rule
Pro:
Tax increases should require more than a simple majority—if there are nearly as
many votes against a tax increase as are in favor of it, the concerns of the minority
must be considered.
There are precedents in the constitution for requiring a supermajority to enact certain
measures.
Robert's Rules of order do not always follow the principle of majority rule, and do
protect the rights of the minority.
The extra vote requiredfor a tax rate increase will demand serious thinking, a
broader consensus, and a higher standard for spending tax dollars.
There is precedent for requiring more than a majority vote, such as expenditures from
the CIF.
Con:
The effectiveness of a supermajority requirement often depends on political
affiliations and philosophies.
Building a consensus may lead to dealmaking and vote trading.
A minority should not be permitted to determine resources for an entire community.
The minority should not be able to determine overall economic policy.
Plymouth's budget and tax rate historically have been approved by more than a
majority vote, even without the requirement.
With a supermajority requirement, some votes become more important than other
votes.
A minority on the council could gridlock the budget and levy approval process.
Vacancies and absences on the council may also prove problematic with a
supermajority requirement.
The principle of majority rule should apply to matters of taxation.
b'3
Issue: Implementing a Supermajority Requirement: Constitutional
or Legislative?
Pro:
A constitutional supermajority requirement would be largely immune from attempts
to circumvent it through legislative action.
A constitutional requirement is more effective at controlling spending and tax
increases than legislative requirements.
Legislative supermajority requirements provide no permanent protection for
taxpayers.
A charter amendment requiring a supermajority vote for a tax rate increase is simple,
clear and permanent. A future city council could change an ordinance at any time.
A charter amendment allows the voters to make a decision on what standard should
be required for future tax rate increases.
Voters are smart enough to decide the issue themselves.
Plymouth can set an example for other local governments in making a strong
statement about tax rate increases, and can provide leadership for the entire state.
Con:
Constitutional changes tend to be permanent, even when circumstances change.
Supermajority requirements limit the ability of the governing body to respond to
changing economic conditions and budget problems.
Legislative supermajority requirements, properly designed, can provide protection
against tax increases.
A charter amendment which requires a supermajority vote for a tax rate increase is
too restrictive—amending the city's equivalent to a constitution is very serious.
Other options are available to achieve the goal of making tax rate increases difficult,
such as an ordinance permitting the council to impose the supermajority requirement
on itself.
An ordinance would provide needed flexibilityfor future city councils to meet
changing circumstances and conditions.
No other Minnesota city has such a requirement for a supermajority vote in a charter.
Py
03/06/98 FRI 12:34 FAX 612 452 5550 CAMPBELL 444 PLYMOUTH
CAMPBELL KNUTSON
Professional Association
Auorneys at Law
612) 452-5000 Joel J.11mnil;
Thomas J. C:;in ti bc{1 Andrea McRmell PoOiler
Roger N. Knutson Fax (612) 452.5550 Marthew K. Brokl$
1110tnas M. Scott john F Kclly
L'llicnt. B. Knctsch Matthawl. Foli
Sucsan l.c;i Puce Mstrgucrirc M. McCarronMarch6, 1998 (*-Worge T. Stephenson
VIA FACSIMILE TRANSMISSION *'%" lb n.vd in w,,- ,
UJ Cmmnl:
Gary 0- Fuchs
Ms. Kathy Lueckert
Assistant City Manager
City of Plymouth
3400 Plymouth Boulevard
Plymouth, MN 55447-1482
Dear Kathy:
You asked for a synopsis of options for the City Charter Commission and City
Council to review given the pending charter amendment.
The current situation is that the City Council by ordinance has proposed a home
rule charter amendment, following the Charter Commission review of the proposal as
required in M.S. 414.12, subd. 5.
Option 1. Take no further action. If neither Commission nor Council acts, the
proposed charter amendment will be placed on the ballot for the November election.
Option 2. The Charter Commission could draft and propose its own amendment. If
the City Council prefers the alternative, it could adopt the amendment by ordinance
M.S. 414.12, subd. 7), and move to repeal its previously passed ordinance proposing
an amendment. This charter amendment by ordinance would be subject to a possible
referendum by petition as provided by law. If the Council chooses not to adopt the
Commission proposal by ordinance, both of the competing charter amendments would
be placed on the November ballot.
Option 3. The Council could repeal its proposed ordinance. If the Council repeals its
ordinance, no further action would be necessary.
Option 4. The City Council could act to amend its previously adopted ordinance. If
the City Council moves to amend its ordinance, the revised version would have to be
submitted to the Charter Commission for its review as was the original amendment
1
Suite 317 0 Faganciale Office Cencer 0 Corporate C:cnter Curve. - Ewan, MN 55121
Z002
03/06/88 FRI 12:34 FAX 612 452 5550 CAMPBELL 444 PLYMOUTH 003
Ms, Kathy Lueckert
March 6, 1998
Page 2
pursuant to M.S. 414.012, subd. 5. The 60 day review and comment period, which
includes the opportunity to suggest a substitute amendment, would again be followed,
and the Council could determine whether to submit their amended version or the
Charter Commission version to the voters.
I hope this brief overview will be helpful.
Very truly yours,
CAMPBELL KNUTSON
Professional Association
JJJ:cjh
58287
03/06/98 FRI 15:30 FAX 612 452 5550 CAMPBELL 444 PLYMOUTH Z 002
CAMPBELL KNUTSON
Professitm ii A.ssoc.i<itit>rl
Attorneys at Law
Thomas J. C4.mpt-wl1 (612) 452.5000 locl J. ,jwiinik
Rot cr N. Knutson
1"aX (G 1 Z) 4SZ-.5.550 Anrlrc:i Mcc[ dwell Poelller
Thomas M. Scutt Matthew K. BT004
Elhoir R. Knctsch John F. Kelly
Suc+.m Lea Pace Mattllcw l. l oh
March 6, 1998 !` orgucrac M. McCarron
VIA EAC SIMII,E..TRANSIV)(ISSION "
r,ri:e l' Srcrl,rncon
Iso Ikenxrd in rVisams;n
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Gary (1 Ft,ic.h;
Mr. Dwight Johnson
City of Plymouth
3400 Plymouth Boulevard
Plymouth, MN 55447-1482
Dear Dwight:
Enclosed are two documents which you might want to consider distributing for
the joint charter commission/city council meeting. The League prepared document
may be sufficient by itself.
In the right-hand column of page 1, the LMC memo makes it clear that "local
governments do not directly set a tax rate". The section which begins on page 2 titled
Property Tax Intricacies explains some of the systematic problems and concludes:
Local officials, however, can only control local levy decisions. They have no direct
ability to modify the overall structure of the tax system and are at the mercy of the
Minnesota legislature."
The one point that we discussed which l have been unable to find any materials
on is the volatility of the taxable tax capacity element of the formula. Page 1 of the
League memo makes an indirect reference as part of the discussion of local tax rates,
but it fails to highlight how uncertain or indeterminate the tax capacity figure is at the
time the city sets the levy. M.S. §§ 275.08, 275.07, and 275.29 (enclosed) do
contain some hints, but nothing definitive. As we discussed, because all of the factors
other than the final city levy are in continual flux, the only practical way to administer
a tax rate limit is to specify a date certain for a "snapshot" of the city. State law
provides for the counties to take this snapshot on March 31 of each year (see M.S.
275.29) . Of course, this number may be substantially obsolete by the time of final
city levy. The only practical way of administering the proposed charter amendment
may be to secure an estimate from the county of the taxable tax capacity in the city at
60267
Suitc 317 - Eagandale Office Center - 1.380 Corporate Center Curve 9 Lagan, MN55121
03/06/98 FRI 15:30 FAX 612 452 5550 CAMPBELL 444 PLYMOUTH 16003
Mr. Dwight Johnson
March 6, 1998
Page 2
a specified date. Maybe Hennepin County has the capability of doing this for the city.
If not, or if they are unwilling to provide an estimate to the city, then the
administration of the charter amendment will be very difficult and very imprecise.
Please contact me if you have any questions.
Very truly yours,
CAMPBELL KNUTSON
Professional Association
JJJ: cjh
Enclosure
cc: Ms. Kathy Luekert
Mayor Joy Tierney
60267
r
03/06/98 FRI 15:33 FAX 612 452 5550 CAMPBELL 444 PLYMOUTH 2008
PROPERTY TAXATION 101Lrw•wM....b-
This guide is intended to describe the basics of Minnesota's property tax system. This system will
collect almost $4.5 billion in 1997 to help fund the services of the state's schools, counties, cities,
townships, and special districts. One of the challenges of trying to understand this system is the
complex array of terms involved. As new terms are introduced in this guide, they are shown in
italics. A glossary at the end of the guide has short definitions of these terms.
ASSESSMENT AND CLASSIFICATION
The property tax system is a continuous cycle, but it
effectively begins with the estimation of property
market values by local assessors. Assessors attempt to
determine the approximate selling price of each parcel
of property based on the current market conditions.
Along with the market value determination, a
property class is ascribed to each parcel of property
based on the use of the property. For example, property
that is owner -occupied as a personal residence is
classified as a residential homestead. The "use class" is
important because the Minnesota system, in effect,
assigns a weight to each class of property. Generally,
properties that are associated with income production
e.g. commercial and industrial properties) have a
higher classification weight than other properties.
The property classification system defines the
tax capacity of each parcel as a percentage of each
parcel's market value. For example, a $75,000 home,
which is classified as a residential homestead, has a
class rate of 1.0 percent and therefore has a tax capacity
Table A: Sample property class rates
Property Class Taxes Taxes
Payable 1997 Payable 1998
Residential Homestead:
72,000 1.0 % 1.0 %
72,000 - $75,000 2.0 1.0
75,000 2.0 1.85
Residential Nonhomestead:
Single unit:
475,000 2.3 1.9
75,000 2.3 2.1
2-3 unit buildings 2.3 2.1
Market -rate Apartments:
Regular 3.4 2.9
Small Cities 2.3 2.3
Commercial/industrial;
100,000 3.0 2.7
100,000 - $150,000 4.6 2.7
150, 000 4.6 4.0
of $75,000 x .01 or $750. (A sample of the class rates
are included in table A.)
parcel market val:u::Cj x class rate parcel tax capacity
The next step in calculating the tax burden for a
parcel involves the determination of each local unit of
government's property tax levy. The city, county,
school district and any special property taxing authori-
ties must establish their levy by December 28 of the
year preceding the year in which the levy will be paid
by taxpayers. The property tax levy is set after the
consideration of all other revenues including state aids
such as LGA, HACA, and LPA.
city budget -I all non -property tax revenues = city levy
For cities within the seven -county Twin Cities
metropolitan area and on the Iron Range, the levies are
reduced by an amount of property tax revenue derived
from the metropolitan and range area fiscal disparities
programs.
LOCAL TAIL RATES
Local governments do not directly set a tax rate.
Instead, the tax rate is a function of the levy and the
total tax base. To compute the local tax rate, a county
must determine the total tax capacity to be used for
spreading the levies. The total tax capacity is com-
puted by first aggregating the tax capacities of all
parcels within the city. Several adjustments to this total
must be made because not all tax capacity is available
for general tax purposes. The result of this calculation
produces taxable tax capacity, Taxable tax capacity is
used to determine the local tax rates.
city levy _ taxable tax capacity -city tax rate
The city tax rate is computed by dividing the city
levy (minus the fiscal disparities distribution levy, if
applicable) by the taxable tax capacity. Under the
current property tax system, the tax rate is expressed as
a percentage. For example, the average 1997 city tax
Property Taxation 101 Page 1
03/06/98 FRI 15:33 FAX 612 452 5550 CAMPBELL
capacity rate is approximately 26 percent. This same
calculation is completed for the county based on the
county's levy and tax base, the school district and all
special taxing authorities. The sum of the tax rates for
all taxing authorities that levy against a single property
produces the total local tax rate. This total local tax
rate is then used to determine the overall tax burden for
each parcel of property.
PARCEL TAX CALCULATIONS
The property tax bill for each parcel of property is
determined by multiplying the parcel's tax capacity by
the total local tax rate. The tax statement for each
individual parcel itemizes the taxes for the county,
municipality, school district, and any special taxing
authorities.
parcel tax capacity x total local tax rate = I tax capacity tax bill
To complicate the tax calculations, voter -approved
referenda levies are applied to the market value of each
parcel, not tax capacity. As a result, each identically -
valued parcel, regardless of the property's use, pays the
same amount of referenda taxes (with the exception of
certain agricultural property, which is taxed at a lower
rate). In 1997, two counties, 18 cities, and 162 school
districts levied market value -based levies. These
communities must have a separate calculation for a
market value referenda levy by the total taxable market
value of each community.
parcel market value x marketyaluetax rate = marketvaluetax bill
tax capacitytaxbill a marketvaluetaxblll=totaltaxbill
PROPERTY TAX CREDITS
Several tax credits for various types of properties are
available in certain instances. These amounts are
subtracted from the overall taxes for each parcel to
determine the net tax bill for the individual owner.
Minnesota also provides additional property tax relief
directly to individual homeowners, cabin owners, and
renters through the circuit breaker and the targeting
refund programs.
PROPER'T'Y TAX INTRICACIES
The technical details of computing property taxes mask
many other intricacies of the property tax system.
Many communities over the past several years have
experienced situations where individual property taxes
rise much faster than the increase in the levies that are
certified by local units of government.
PLYMOUTH 16009
The most common factor that results in an increase
in an individual parcel's tax is the change in the parcel's
estimated market value. without any change in local
levies, a property owner can experience a tax increase
due almost exclusively to any valuation increase.
The Legislature frequently changes the classifica-
tion system. Changes to the classification system can
shift property tax burdens from one type of property to
another. Table A demonstrates some of the changes the
Legislature made to class rates from 1997 to 1998.
Commercial, industrial, and apartment properties
received significant reductions in their class rates. This
shifts tax burden to other classes of property which did
not receive class rate reductions, In an effort to mini-
mize the effect of these shifts, the Legislature reduced
school levies across the state and created the Education
Homestead Credit. This credit will reduce the school
general tax levy by 32 percent for all homesteads, up to
a maximum of $225.
Economic factors that may affect broad classes of
property can also influence the overall tax changes for
individual parcels of property. For example, in the
early 1990s the metropolitan area experienced major
declines in the valuation for commercial and industrial
properties. These valuation declines shifted taxes from
property classified as commercial and industrial to all
other types of property. 'Valuation declines also may
have accentuated the levy changes by local units of
government.
The 1993 requirement of applying new voter -
approved referenda levies to market value rather than to
tax capacity accentuates the tax increases for certain
classes of property like homestead/residential and
agricultural properties, which have low class rates.
Legislative changes in state aid formulas can also
affect the revenue needed to be raised from the property
tax. The amount of money that is currently shared with
cities through the LGA and HACA programs has
increased more slowly than inflation since 1989. When
these revenue sharing programs decline, cities must
either cut services or raise their only source of local tax
revenue, the property tax.
This discussion is only a general overview of the
current Minnesota property tax system. Over time, the
system has become more complex and difficult for
taxpayers to understand. Unfortunately, local officials
must frequently explain how the system works and take
the blame for the complicated features of the system.
Local officials, however, can only control local levy
decisions. They have no direct ability to modify the
overall structure of the tax system and are at the mercy
of the Minnesota Legislature.
Page 2 Property Taxation 101
03/06/98 FRI 15:34 FAX 612 452 5550 CAMPBELL
GLOSSARY OF TERMS
CIRCUIT BREAKER - A state -paid property tax refund
program for homeowners who have property taxes
out of proportion with their income. A similar
program is also available to renters.
CLASS RATES - The percent of market value set by state
law that establishes the property's tax capacity
subject to the property tax. (See Table A for a
sample list of class rates)
FISCAL DISPARITIES PROGRAMS - Local units of govern-
ment in the Twin Cities metropolitan area and on
the Iron Range participate in property tax base
sharing programs. Under these two programs, a
portion of the growth in commercial and industrial
property value of each city and township is contrib-
uted to a tax base sharing pool. Each city and
township then receives a distribution of property
value from the pool based on market value and
population in each city.
HOMESTEAD AND AGRICULTURAL CREDIT AID (HACA) - A
property tax relief program that replaced the former
homestead credit program and the agricultural
credit program. HACA is tied to class rate reduc-
tions for certain classes of property.
LOCAL r-OVERNMENT AIU (LGA) - A state government
revenue sharing program for cities and townships
that is intended to provide an alternative to the
property tax. LGA is distributed through a formula
based on tax base, population, population decline,
age of housing, and the percent of market value
classified as commercial or industrial. No city can
receive less LGA than it did in 1993.
LOCAL PERFORMANCE AID (LPA) - A state program for
cities and counties that is intended to provide an
incentive for local governments to develop perfor-
mance measurement systems.
LOCAL TAX RATE - The rate used to compute most taxes
Localforeachparcelofproperty. Lal tax rate is
computed by dividing the certified levy (after
reduction for fiscal disparities distribution levy, if
applicable, and county disparity reduction aid) by
the taxable tax capacity.
444 PLYMOUTH Z010
MARKET VALUE - An assessor's estimate of what prop-
erty would be worth if sold on the open market.
The market value is set on January 2 of the year
before taxes are payable.
MARKET VALUE LEVIES - Voter approved levies applied
to a parcel's market value rather than tax capacity.
PROPERTY CLASS - The classification assigned to each
parcel of property based on the use of the property.
for example, owner -occupied residential property
is classified as homestead.
PROPERTY TAX LEVY - The tax imposed by a local unit of
government. The tax is established on or around
December 28 of the year preceding the year that the
levy will be paid by taxpayers.
TARGETING REFUND - A state paid property tax refund
for homeowners whose property taxes have in-
creased by more than 12 percent. A similar pro-
gram is available to cabin owners.
TAX CAPACITY - The valuation of property based on
market value and statutory class rates. The prop-
erty tax for each parcel is based on its tax capacity.
TAXABLE TAX CAPACITY - The sum of the tax capacities
of all parcels in the taxing jurisdiction after adjust-
ments for fiscal disparities, tax increment and other
property not available for general tax purposes.
TOTAL TAX CAPACITY - The amount computed by fust
totaling the tax capacities of all parcels of property
within a city.
TOTAL TAX RATE - the sum of the local tax rates for all
taxing authorities that levy against a parcel of
property (county, school, city or town, and special
taxing districts). The total tax rate times the
parcel's tax capacity equals the amount of taxes the
property pays (not counting any voter -approved
market value levies).
TItuTI1 IN TAXATION.- The taxation and notification law,
which requires local governments to set estimated
levies, inform taxpayers about the impacts, and
hold a separate hearing to take taxpayer input.
Property 'Taxation 101
Page 3
03/06/98 FRI 15:34 FAX 612 452 5550 CAMPBELL ... PLYMOUTH
FISCAL DISPARITIES 101
Local government units within the Twin Cities met-
ropolitan area that includes the counties of Anoka,
Carver, Dakota, Hennepin, Ramsey, Scott, and Wash-
ington participate in a property tax base sharing pro-
gram known as Metropolitan Fiscal Disparities. A
similar program will begin with taxes payable in 1998
for local government units in the Taconite Area that in-
cludes portions of the counties of St. Louis, Itasca,
Crow Wing, Aitkin, and Koochiching, and all of Lake
and Cook counties. Under these programs, a portion of
the growth in commercial, industrial, and public utility
property value of each community is contributed to a
tax base sharing pool. Each community receives a dis-
tribution of property value from the pool based on the
market value and population of each city.
CONTRIBUTION
The contribution to the pool is equal to 40 percent of
the growth in commercial, industrial, and public utility
value since the base year (1971 for the Twin Cities,
1995 for the Taconite Area). This measure of growth
includes both new construction and inflationary in-
creases in existing property values. In 1997, for ex-
ample, the total amount of tax capacity contributed to
the Metropolitan fiscal disparities pool was $275.1 mil-
lion, which represents approximately 12 percent of the
total tax capacity within the seven -county area. The
contribution value is not available for local tax purposes
and therefore, the contribution value must be subtracted
from the total tax capacity of each community before
the local tax rate is computed.
DISTRIBUTION
The tax capacity contributed to the pool is based on a
distribution index. This index compares each city's to-
tal market value per capita to the average market value
per capita for all cities and towns in the seven counties.
Cities that have relatively less market value per capita
receive a relatively larger distribution from the pool
than cities with greater market value wealth per capita.
Page 4
HOW ARE PROPERTY TAXES GENERATED?
The tax capacity contributed to the pool ultimately
translates into property tax dollars for each local gov-
ernment. These property taxes, also known as the dis-
tribution levy, arc computed for each local government
by multiplying its distribution value by its prior year
tax capacity rate. The distribution levy represents the
amount of each local government's certified levy raised
through the fiscal disparities program, The balance of
the certified levy is used to compute the local tax rate.
HOW ARE COMMERCIAIANDUSTRIAL AND
UTILITY PARCELS TAXED?
Commercial and industrial properties are not taxed
twice. Instead, a portion of each commercial or indus-
trial property's tax capacity is taxed at the area -wide tax
capacity Tate and the balance is taxed at the total local
tax rate. As a simple example, in a community where
exactly 40 percent of all commercial, industrial, and
utility property is contributed to the fiscal disparities
pool, 40 percent of each parcel's value is taxed at the
area -wide tax rate and 60 percent is taxed at the total
local tax rate. For 1997, for example, the 'Twin Cities
area -wide tax rate was 139.376 percent.
POLICY ISSUES
Declines in the market values for Twin Cities area com-
mercial/industrial properties in the early 1990's not
only directly shifted property tax burdens to other types
of property, they also reduced the amount of commer-
cial and industrial valuation contributed to the fiscal
disparities pool. As a result, the totaj distribution levy
generated through the fiscal disparities program for all
local governments was also reduced, In recent years,
commercial/industrial market value rebounds have re-
versed this trend. But reductions in the commercial/in-
dustrial and public utility property tax class rates by the
1997 legislature will likely result in significant declines
in the tax capacity of both the Metropolitan and Taco-
nite Area fiscal disparities pools in future years. As the
amount of this distribution levy declines, a greater share
of the local tax bill is paid by other types of properties,
including the portion of each commercial, industrial,
and utility property value taxed at the local tax rate.
Property Taxation 101
Z011
03/06/98 FRI 15:31 CAMPBE a.4_* 004
4 225 TAM; LEVY, t JtTENsioN 275.295
Subd_ 2. Certificate of auditor. The auditor shall make in each assessment book or list a I
certificate in the following form:
1, A.13., auditor of ............ county, and the state of Minnesota, do hereby certify that the
following is a correct list of the taxes levied on the real and personal property in the (town or
district, as the case may be) of ............ for the year 19.. (being the same year the property was
assessed and the tax levied), to become payable in the year 19.. .
Witness my hand and official seal this ...... day of .............19.. .
County Auditor.
Subd. 3. Designation of year of tax. Taxes on real and personal property shall be re-
lated to and designated on the property'tax statement by the year in which they become pay-
able but the liens shall relate back to the assessment date preceding except as otherwise pro-
vided. For cash basis taxpayers, taxes on real and personal property shall relate to the year in
1- which they become payable. For accrual basis taxpayers, taxes on real and personal property
rs shall relate to the year in which the lien arose.
h Subd. 4. Unit card ledger counties. In any county in this state in which the county audi.
Dr for has elected to come under the provisions of section 273.03, subdivision 2, the auditor
n shall cause to be prepared a record to be known as "Real estate assessment and tax list for the j
ly year ................. In addition to the information provided for in subdivision 1, to be shown in
s tax lists, there shall also be included the amount of market value of land, building. and ma-
chinery, if any, and the total market value assessed against each parcel of real estate contained
in such lists.
In such counties the auditor shall make in each list a certificate in the following form: l
I . ...............,auditor of ..._.......... county and State of Minnesota, do hereby certify that f
SS the following is a correct list of the taxes levied on the real property. based on the total market
Y- value indicated therein, in the (town or district, as the case may be) of .................. for the year
nt 19.. .
X. Witness my hand and official seal this ................... day of ............... 19..
c
c.
l
County Auditor." I
e History: (2071. 2072) RL s 875,876; 1963 c• 39 s 1.2; 1963 c 781 s 5: 1965 c 545 s
i- 1: 1969 c 323 s 1; 1973 c 458 s 1; 1975 c 339 s 8: 1980 c 607 art 2 s 18; 1946 c 444:
r• 1988 c 719 art 5 s 84: 1989 c 277 art 4 s 24: 1989 c 329 art 15 s 20: 1 Sp1989 c 1 art 2 s
11;art 9s47; 1993 c 375 art 2 s I
275.29 ABSTRACTS TO COMMISSIONER OF REVENUE. tI' Not later than March 31, in each year. the eonnty auditor shall mnke and transmit to the
J- commissioner of revenue, in such form as may be prescribed by the commissioner of reve-
nt nue, complete abstracts of the tax lists of the county, showing the number of acres of land :1
rx assessed; its value, including the structures thereon; the value of town and city lots. including.
h structures; the total value of all taxable personal property in the several assessment districts:
a the aggregate amount of all taxable property in the county, and the total amount of taxes lev-
y ied therein for state, county, town, and all other purposes for that year. ;.
tsL
id History: (2073) RL s 877; 1974 c 86 s 1; 1975 r 46 s 4; ISp1989 c !art 9 s 48 i '•
n
275.295 WETLANDS EXEMPTION; REPLACEMENT OF REVENUE.
e. Subdivision 1. Certification. The total amount of revenue lost as a result of the exemp-
7e tion provided in section 272.02, subdivision 1, paragraph (10), clause (iii), must be certified
r_ by the county auditor to the commissioner of revenue and submitted to the commissioner as
Se part of the abstract of tax lists to be filed with the commissioner under the provisions of sec -
If tion 275.29. The amount of revenue lost as a result of the exemption must be computed each
c year by applying the current local tax rates of the taxing jurisdictions in which the wetlands
x_ are located to the net tax capacity of the wetlands. Payment to the county for lost revenue
must not be less than the revenue that would have been received in taxes if the wetlands had a
its j
004
03/06/98 FRI 15:31 FAX 612 452 5550 CAMPBELL 444 PLYMOUTH [moo
27S.067 TAXES; LEVY; EXTEK%ON , I&
275.067 SPECIAL TAXING DISTRICTS; ORGANIZATION DATE; CERTIFI-
CATION OF LEVY OR SPECIAL ASSESSMENTS.
Special taxing districts as defined in section 275.066 organized on or before July I in a
calendar year may certify a levy to the county auditor in that same year for property taxes or
special assessments to be payable in the following calendar year to the extent that the special
taxing district is authorized by statute or special act to levy taxes or special assessments. Spe•
cial taxing districts organized after July 1 in a calendar year may not certify a levy of property
taxes or special assessments to the county auditor under the powers granted to them by statute
or special act until the following calendar year.
History: 1994 c 416 art I s 29
275,07 CITY, TOWN, COUNTY, AND SCHOOL DISTRICT TAXES.
Subdivision 1. The taxes voted by cities, counties, school districts, and special districts
shall be certified by the proper authorities to the county auditor on or before five working
days after December 20 in each year. A town must certify the levy adopted by the town board
to the county auditor by September 15 each year. If the town board modifies the levy at a
special town meeting after September 15, the town board must recertify its levy to the county
auditor on or before five working days after December 20. The taxes certified shall not be
reduced by the county auditor by the aid reeeivcd under section 273.1398, subdivision 2, but
shall be reduced by the county auditor by the aid received under section 273.1398, subdivi-
sion 3. If a city, town, county, school district, or special district fails to certify its levy by that
date, its levy shall be the amount levied by it for the preceding year.
Subd. la. Application of limitations. Any limitation upon the amount that may be lev-
isd by a local taxing jurisdiction shall apply to the sum of the levy as certified under subdivi-
sion 1 plus the certified homestead and agricultural credit aid amount under section
273.1398, subdivision 2. unless the commissioner of revenue certifies to the county auditor
that the limitation applies to the levy under subdivision 1 only.
Subd. 2. In school districts lying in more than one county, the clerk shall certify the tax
levied to the auditor of the county in which the administrative offices of the school district are
located.
Subd. 3. [Repealed, 1993 c 375 art 4 s 21 ]
Subd. 4. Report to commissioner, On or before October 8 of each year. the county au-
ditor shall report to the commissioner of revenue the proposed levy certified by local units of
government under section 275.065, subdivision 1. On or before January 15 of each year, the
county auditor shall report to the commissioner of revenue the final levy certified by focal
units of government under subdivision 1. The levies must be reported in the manner pre-
scribed by the commissioner. The reports must show a total levy and the amount of each spe-
cial levy_
History: (2058) RL s 869: 1973 c 123 apt 5 s 7: 1977 c 423 art 4 s 5; 1978 c 764 s
101; 1987 c 268 art 6 s 36: art 7 s 40; 1988 c 719 art 5,,r 31,32:1989 c 277 art 2 s 37;
1 Sp1969 c 1 art 3 s 23; art 4 s 1,2: art 9's 39.40; 1990 c 480 art 7 s 17; 1990 r 604 art 3
s 27,28; art 4 s 5; 1993 c 375 art 3 s 25,26; art 4 s 6.7; ISp]993 c I art 2 s 6; 1994 c 416
art 1 s 65; 1994 c 465 art 3 s 73; 1995 c 264 art 11 s 6; 1995 c 471 art 3 s 19
275.075 OMISSION BY INADVERTENCE; CORRECTION.
Whenever the amount of taxes as levied and certified by the tax levying body of any
county, city, town, or school district has not been, as the result of error, inadvertence, or from
the estimates as provided in section 275.08, by the county auditor extended and spread in
conformity therewith, such tax levying body may include in its tax levy for the year follow-
ing, the whole or any part of the amount so omitted through error. inadvertence, or from the
estimates as provided in section 275.08, in addition to its current levy and in addition to and
notwithstanding any limitations to the contrary.
History:1947 c 71 s 1; 1973 c 123 art 5 s 7; 1Spl981 c I art 8 s 9
275.077 ERRORS BY COUNTY AUDITOR AFFECTING TOWNSHIP LEVY.
Subdivision 1. If an error is made by a county auditor in recording the levy of a township
lower than the levy certified by the township, the governing body of the county in which the
03/06/98 FRI 15:32 FAX 612 452 5550 CAMPBELL 444 PLYMOUTH
31 B 219 TAXES; LEVY, EXTENSION 275.03
i.
CERTIFI- error was made shall appropriate and disburse to the affected township sufficient funds to
make up for the difference created by the error within 30 days of notification of the error.
re duly 1 in a ` Subd. 2. The difference between the correct levy and the erroneous levy shall be added
erty taxes or to the township levy for the subsequent levy year; provided that if the amount of the differ -
at the special ence exceeds 0.12089 percent of taxable market value. the excess shall be added to the.town-
sments. Spe- ship levy for the second and later subsequent levy years, not to exceed an additional levy of
y of property 0.12089 percent of taxable market value in any year, until the full amount of the difference
The funds collected from the corrected levies shall be used to reimburse theembystatutehasbeenlevied.
county for the payment required by subdivision 1.
History: 1979 c 16 s 1.2: 1989 c 277 art 4.y 23
006
275.08 AUDITOR TO FIX RATE,
ecial districts
five working Subdivision 1. Generally. The rate percent of all taxes, except the state tax and taxes the
le town board race of which may be fixed by law, shall be calculated and fixed by the county auditor accord -
the levy ata ing to the limitations in this chapter hereinafter prescribed; provided. that if any county, city.
to the county
town, or school district shall return a greater amount than the prescribed rates will raise,'the
I shall not auditor shall extend only such amount of tax as the limited rate will produce.
rr 2, butbut Subd. 1a. For taxes payable in 1989, the county auditor shall compute the gross tax ca -
398,subdivi- 398, aeit for each parcel according to the class rates specified in section 273.13. The gross taxPyPgP
s levy by that capacity will be the appropriate class rate multiplied by the parcel's market value. For taxes
payable in 1990 and subsequent years, the county auditor shall compute the net tax capacity
t may be lev- for each parcel according to the class rates specified in section 273.13. The net tax capacity
nder subdivi. will be the appropriate class rate multiplied by the parcel's market value,
nder section Subd. lb. Computation of tax rates. The amounts certified to be levied against net tax
nunty auditor capacity under section 275.07 by an individual local government unit shall be divided by the
total net fax capacity of all taxable properties within the local government unit's taxing juris-
ertity the tax diction. The resulting ratio, the local government's local tax rate, multiplied by each proper -
to] district are ty's net tax capacity shall be each property's net tax capacity tax for that local government
unit before reduction by any credits.
Any amount certified to the county uuditor to be levied aguinst market value shall be
he county au- divided by the total referendum market value of all taxable properties within the taxing dis-
loeal units of trict. The resulting ratio, the taxing district's new referendum tax rate, multiplied by each
each year, the property's referendum market value shall be each pruperty'S new referendum tax before re-
ified by local duction by any credits. For the purposes of this subdivision, "referendum market value"
manner pre-
means the market value as defined in section 124A.02, subdivision 3b.
t of each spe- Subd. lc. After the local tax rate of a lucal government has been determined pursuant to
subdivision lb, the auditor shall adjust the local government's local tax rate thin tach
978 c 764 s unique taxing jurisdiction as defined in section 273.1398, subdivision 1, in which the local
government exercises taxing authority. The adjustment shall equal the unique taxing juris-
c604art 3 diction's disparity reduction aids allocated to the local government pursuant to section
1994 a 416 273.1398, subdivision 3, divided by the total tax capacity of all taxable property within the
unique taxing jurisdiction. The adjustment shall reduce the local tax rate of the local govern-
ment within the unique taxing jurisdiction for which the adjustment was calculated.
Subd. Id. If, after computing each local government's adjusted local tax rate within a
body of any unique taxing jurisdiction pursuant to subdivision lc, the auditor finds that the total adjusted
enee, or from local tax rate of all local governments combined is less than 90 percent of grosstax capacity
and spread in for taxes payable in 1989 and 90 percent of net tax capacity for taxes payable in 1990 and
year follow- thereafter, the auditor shall increase each local government's adjusted local tax rate propor-
c, or from the tionately so the total adjusted local tax rate of all local governments combined equals 90 per-
ddition to and :i cent. The total amount of the increase in tax resulting from the increased local tux rates must
not exceed the amount of disparity aid allocated to the unique taxing district under section
273.1398. The auditor shall certify to the department of revenue the difference between the
disparity aid originally allocated under section 273.1398, subdivision 3, and the amount nec-
P LEVY. essary to reduce the total adjusted local tax rate of all local governments combined to 90 per -
cent. Each localofatownship government's disparity reduction aid payment under'section 273.1398, sub -
y in which the division 6, must be reduced accordingly.
006
03/06/98 FRI 15:32 FAX 612 452 5550 CAMPBELL 444 PLYMOUTH 4 007
275.08 TAXES; LEVY, EXTENSION 220
Subd. 2. Estimates. If, by January 1.5 of any year, the county auditor has not received
from another county auditor the local tax rate or gross tax capacity applicable to any taxing
district lying in two or more counties, the county auditor who has not received the necessary x1
information may levy taxes for the overlapping district by estimating the local tax rate or the
gross tax capacity. .
Subd. 3. Assistance of county auditor. A county auditor who has not furnished the lo-
cal tax rate or gross tax capacity of property in the county by January 15 shall, on request,
furnish the county auditor of a county in the overlapping district an estimate of the tax capaci-
ties or the local tax rate. The auditor may request the assistance of the county assessor in de-
termining the estimate.
Subd. 4. Subsequent adjustment. After the correct local tax rate or net tax capacity has
been certified, the amount of taxes over or under levied shall be computed and notice sent to
each affected taxing district. If the estimated tax levy exceeds the correct tax levy based on
actual net tax capacity and local tax rate, the county treasurer shall remit any amount of ex-
cess collected to the affected taxing district. In the following levy year, the estimating county
auditor shall adjust the levy of the affected taxing district to compensate for the amount of
variance.
In the event that the estimated tax levy is less than the correct tax levy based on actual;
net tax capacity and local tax rate, the auditor shall adjust the levy of the affected taxing dis-
trict as provided in section 275.075.
History: (2059) RL .r 870: 1 Sp1981 c I art 8 s 10; 1986 c 444; 1988 c 719 art 5 s
33--35,84; 1989 c I s 2; 1989 c 329 art 13 s 20. 15p1989 c I art 2 s 11; art 9,v 41,421-
1991 c 291 art 1 s 27; 1995 c 264 art 115 7; 1996 c 471 art 3 s 20
275.081 ,[Repealed. 1988 a 719 art 5 s 81]
275.082 [Repealed, 1988 c 719 an 5 s 81 ]
275.09 Subdivision 1 _ [Repealed, 1984 c 593 s 46]
Subd. 2. [Repealed, 1984 c 593 s 46]
Subd. 3. [Repealed, 1983 c 342 art 3 s 9]
Subd. 3. [Repealed, 1983 c 342 art 3 s 9: 1984 c 593 s 461
Subd. 4. [Repealed, 1984 c 593 s 46]
275.091 [Repealed, 1984 c 593 s 46] t
275.092 LOCAL ACTS LIMITING COUNTY LEVY OR APPROPRIATION.
Any special act for a single county relating to a limitation on the authority of a county
board to levy taxes or make an appropriation for a particular purpose. however stated in stills,
dollars, or a per capita amount, which is inconsistent with Laws 1973, chapter 583, sections 1
to 35 is superseded.
History: 1973 c 583 s 36
275.10 [Repealed, 1979 c 153 s 2]
275.11 Subdivision 1. MS 1990 [Repealed, I Sp 1989 c I art 5 s 51 ]
Subd. 2. MS 1990 [Repealed, 1Sp1989 c 1 art 5 s 51]
Subd. 3, MS 1957 [Repealed, 1961 c 500 s 21
Subd. 3. MS 1990 [Repealed, 1Sp1989 c 1 art 5 s 51]
Subd. 4. MS 1990 [Repealed. 1Sp1989 c I art 5 s 51]
275.12 [Repealed, Ex1971 c 31. art 20 s 25]
275.121 (Local]
275.122 MS 1969 [Expired]
275.123 [Repealed, Ex 1971 c 31 art 20 s 251
275.124 REPORT OF CERTIFIED LEVY.
Prior to April 1 of each year, each county auditor shall report to the commissioner of 124
children, families, and learning on forms furnished by the commissioner, the amount of the
SC-Ot lsr.,tf aw,
Chronology of Supermajority Vote Issue
Fall 1995 Possibility of requiring a supermajority vote of the city council
for a tax rate increase is in the campaign platforms of some individuals running for city
council.
May 1, 1996 Councilmember Preus brings up the possibility of an ordinance requiring
supermajority vote for tax increase. Placed on May 15, 1996 agenda for further
discussion and possible action.
May 15, 1996 Regular City Council meeting. City Council adopts ordinance proposing a
charter amendment which requires a supermajority vote of the city council for a tax rate
increase. Under state statutes, the Charter Commission has sixty days (or until July 15) to
accept or reject the proposed amendment, or to propose different language. The Charter
Commission also has the option of filing with the city clerk an extension for an additional
ninety days of review (or until October 15).
May 23, 1996 Charter Commission meeting. Charter Commission votes to meet again
on July 9; invites City Council to attend meeting to discuss proposed amendment.
June 19, 1996. Regular City Council meeting. City Council discusses supermajority
issue and the invitation of the Charter Commission to its July meeting. Councilmember
Preus agrees to attend meeting. Council passes resolution encouraging Charter
Commission to act quickly on the supermajority proposal so that the amendment can be
on the November 1996 ballot. The council declines to meet with the Charter Commission
unless the meeting is televised.
July 9, 1996. Charter Commission meeting. Charter Commission hears from
Councilmember Preus on the supermajority proposal. Charter Commission votes to file
with the city clerk an extension for an additional ninety day review period. Commission
votes to meet on July 30 with city attorney.
July 10, 1996. Regular City Council meeting. City Council discusses issues related to
the Charter Commission and the supermajority proposal.
July 30, 1996. Charter Commission meeting. Charter Commission meets with city
attorney to discuss the supermajority issue. Commission votes to meet on August 20 to
hear from interested speakers, and to hold a public, televised meeting on September 9.
August 20,1996. Charter Commission meeting. Charter Commission hears from
speakers from the League of Minnesota Cities, Minnesota Taxpayers Association, and the
former city manager of Plymouth.
1
August 21, 1996. Regular City Council meeting. City Council discusses issues related to
the Charter Commission and the supermajority proposal.
September 9, 1996. Charter Commission public hearing. Charter Commission holds
televised public meeting on the supermajority proposal. Commission tables any action
on a recommendation to the city council until Charter Commission meeting on September
30, 1996.
September 10, 1996. Special City Council meeting. City Council discusses Charter
Commission meeting of previous evening.
September 20, 1996. Special City Council meeting. A special city council meeting is
called by three councilmembers to receive report from the Charter Commission on the
supermajority proposal. This date was the last possible date to meet deadlines to place a
question on the November 1996 ballot. The Charter Commission does not make a report.
September 30, 1996. Charter Commission meeting. Charter Commission meets and
votes to reject the proposed supermajority amendment.
October 2, 1996. Regular City Council meeting. City Council receives Charter
Commission report. Council votes to place the proposed supermajority amendment on
the November 1998 ballot.
October 21, 1997. Charter Commission meeting. Charter Commission meets to discuss
proposed supermajority amendment. Commission votes to request the City Council to
repeal actions which place the issue on the ballot in November 1998, and invites City
Council to attend the December 2, 1997 Charter Commission meeting.
November 12, 1997. Special City Council meeting. City Council discusses Charter
Commission request, and takes no action.
December 2, 1997. Charter Commission meeting. Charter Commission meets and votes
to request that the City Council place a discussion of the Commission's October 1997
resolution on a regular agenda, and to hold a public hearing on the supermajority issue by
April 1, 1998.
January 7, 1998. City Council decides to hold special meeting to discuss the
supermajority issue on March 11, 1998. The Charter Commission is encouraged to
attend.
a
Supermajority Vote Issue
May Councilmember Christian Preus proposed a requirement to mandate a vote
of 5/7 (a supermajority) of the city council to increase the city's tax rate. Initially, it was
thought that this requirement could be instituted by ordinance. However, the City
Attorney opined that such an ordinance might be inconsistent with the Plymouth City
Charter. The City Council considered three options for a supermajority vote:
Option 1 placed language in the charter requiring a supermajority vote to increase the
tax rate over that of the prior year
Option 2 placed language in the charter requiring a supermajority vote to increase the
tax rate over the prior year, except if certain circumstances (involving the city's
finances) are met. If the conditions are met, a simple majority could increase the tax
rate.
Option 3 placed language in the charter which allows the city council to impose the
supermajority requirement by passing an ordinance to that effect.
The City Council voted to send only Option 1 to the Charter Commission for their
consideration. The council's intent was to place the proposed amendment on the ballot
for the November 1996 general election.
May - September 1996. Under state statutes, a city council can initiate amendments to a
city charter. The charter commission has sixty days to review the proposed amendment,
but can file for a ninety day extension for further review. The Plymouth Charter
Commission requested a ninety day extension in July 1996. If the Commission took the
full 150 days to examine the proposed amendment, placing the amendment before the
voters in November was not possible.
In considering the proposed amendment, the Charter Commission reviewed its own work
on the supermajority issue from 1992, when the charter was drafted. The Charter
Commission also sought the opinions of individuals, including Councilmember Preus,
about the supermajority issue. The Charter Commission held a public hearing on
September 9, 1996. The Commission made its final report to the City Council on
September 30, 1996. The Charter Commission recommended rejection of the proposed
amendment. The resolution passed by the Charter Commission is as follows:
The Plymouth Charter Commission hereby gives its reasons for rejecting the proposed
charter amendment requiring a supermajority vote for a tax rate increase:
1. There has been no public support for the concept of a supermajority requirement for
the increase of a tax rate.
2. A supermajority rule does not represent good government as it relates to issues of
taxation. We endorse the principle of majority rule when it comes to fiscal responsibility.
3. As a matter of constitutional law, we do not believe that future councils should be
bound by a supermajority voting requirement on fiscal matters. Such issues should be
resolved by traditional democratic procedures, at the heart of which is the majority rule.
4. Expert testimony presented to the City Charter Commission has not supported the
idea of a supermajority requirement. The contrary has been true.
S. In the two year process of drafting the City Charter, this Commission considered and
rejected the supermajority concept as it related to taxation.
6. The Charter Commission is irrevocably opposed to the concept of the "tyranny of the
minority. " Issues relating to taxation ought to be controlled by the majority.
7. The Charter Commission is not opposed to future reconsideration of the
supermajority requirement if valid evidence in support of the concept is presented.
8. The supermajority requirement does not exist in the form proposed in any other
Minnesota city charter.
This report was given to the City Council on October 3, 1996.
October 1996. The City Council received the Charter Commission's report, and
expressed disappointment that the amendment would not be on the ballot in November.
The Council passed a motion placing the proposed amendment on the ballot for
November 1998, the next general election. Some interest was expressed by both the City
Council and the Charter Commission in perhaps compromising on Option 3, which
would place language in the charter allowing the council to impose the supermajority
requirement by ordinance. The Charter Commission may propose a different
supermajority amendment prior to November 1998.
Regular Council Meeting
May 1, 1996
Page 11
Item 9-E Ordinance to Require a 5/7 Vote of the Council to Increase the Tax Rate
Councilmember Preus stated that only a simple majority vote is currently
needed in order to increase the City tax rate. He favors a provision to require
a 5/7 vote of the Council. Initially, it was proposed that the Council adopt an
ordinance to accomplish this; however, the City Attorney determined that this
may be inconsistent with the City Charter. Councilmember Preus advised the
Council that he has asked Manager Johnson to recommend options for
enacting this through the Charter Commission at the May 15 Council meeting.
Motion was made by Councilmember Anderson, seconded by Councilmember
Lymangood, to adjourn the meeting at 8:30 p.m. Motion carried, seven ayes.
Laurie F. Ahrens
City Clerk
3
r f
s//slq
Agenda Number: 9a
TO: Mayor and City Council
FROM: Dwight D. Johnson, City Manager
SUBJECT: Amendment to City Charter for supermajority vote to raise the tax rate
DATE: May 8, 1996
1. ACTION REQUESTED: Consider approval of one of the attached ordinances proposing
to amend the City Charter to require a supermajority vote of the City Council to raise the
City's tax rate.
2. BACKGROUND: At the May 1 Council meeting, Council member Christian Preus
requested development of a City Charter amendment to require a 5/7 vote of the City
Council to raise the City's tax rate in any fiscal year. The City Attorney has previously
opined that the current City Charter may not allow the Council sufficient authority to pass
an ordinance requiring a supermajority at this time.
City Clerk Laurie Ahrens has identified a section of the statutes that provides for the City
Council to initiate a charter amendment in ordinance form. A copy is attached. If the
Council initiates an amendment in ordinance form, the Charter Commission has 60 days to
review it. However, they can extend that time by an additional 90 days. The Commission
can propose an alternative to the initiative if it wishes. The City Council can then choose
between its own initiative and that of the Charter Commission and, under its own power,
can decide which version is presented to the voters. The voters have the final approval
over any charter amendment in this procedure.
3. ALTERNATIVES: Two alternative ordinances have been prepared by City Attorney
Roger Knutson. The first ordinance proposes a simple, straightforward amendment to the
City Charter which would place language directly into the charter requiring a two-thirds
majority vote for any increase in the City's tax rate.
The second ordinance would amend the Charter to enable the Council to pass its own
ordinance, but with conditions in the charter about how the ordinance applies and how it
may be repealed. The ordinance requiring a supermajority could apply to all situations
except where the City loses at least 20 % of its state aid or loses more than 10 % of its net
tax capacity for any reason. The latter provision would accommodate both state legislative
changes and substantial economic devaluations. Restrictions on repealing the ordinance
would include two required public hearings with notice.
r
5/q<,>
Of course, there are many possible permutations of the second ordinance. The situations
that the eventual ordinance would apply to could be increased or decreased, and the
restrictions on repeal could be increased or decreased in various ways.
Finally, there is the option of taking no action.
4. DISCUSSION: The straightforward charter amendment represented by the first
ordinance has the advantages of simplicity and clarity, both for ourselves and the tax payers.
It also would appear to have more permanence, which may be reassuring to the taxpayers.
However, it is also the least flexible option if the City's budget and economic status should
markedly change. Examples of such change might include (1) no more growth beyond the
MUSA line, (2) State legislative changes in state aids, tax policy, fiscal disparities, and other
tax base sharing (Orfield type legislation), (3) major economic change in property values due
to economic distress, such as the tax abatements that occurred in the commercial/industrial
portion of the tax base a few years ago, (4) a major physical disaster such as a tornado or flood
and (5) opportunities might present themselves which would raise the City's tax rate, but not
the overall tax rate. An example would be if we took over the Met Council transit levy
locally, as legislation this year now authorizes us to do..
The second charter amendment draft loses some of the advantages of simplicity, clarity, and
permanence. However, it does provide for exceptions for many of the potential major changes
in the City's condition identified above.
In contemplating a charter amendment, some of the questions to consider might include:
1. How much specific language should be placed in the charter itself, which is our City
constitution?
2. How necessary is a charter amendment? Is it likely that the City would propose
increases in the tax rate in the foreseeable future without any restrictions?
3. Will Moody's be influenced to downgrade our AAA bond rating? Moody's spoke out
strongly against the Legislature's tax freeze proposal earlier this year and generally
dislikes revenue restrictions.
4. Will additional restrictions on raising the tax rate cause future Councils and
administrations to not cut tax rates when they otherwise could and should, for fear of
being caught with their tax levies down in a subsequent year?
5. How likely are the potential major changes in the City's status?
6. How much has the taxpayers trust in us as local official deteriorated, thus requiring
external" controls on us?
7. Will our adoption of a voluntary limitation show leadership to other local jurisdictions
who have been raising tax rates?
5. BUDGET D PACT: There is little impact on the budget for the next year or two,
absent one of the major changes in our situation. Substantial growth revenues should
continue for another year or two, making in increase in the tax rate easily avoidable. Long
range impacts are more difficult to forecast.
jla ff i'yOr
6. RECOMIVVIENDATION: I strongly share the Council's goal to not increase the City's tax
rate. In fact, over the last three years, the City's tax rate has declined by over 17% since
1993 (from 18.04 to 14.94), and we now have the lowest tax rate of any Minnesota City
over 10,000 population. I also agree with the concept of making a strong public statement
about our intentions to continue to keep the tax rate down in the future. Such a statement
would help build trust with our citizens, many of whom do not know our excellent recent
record on reducing tax rates. It would also show leadership to other jurisdictions that it is
possible to provide high quality services without constantly raising taxes.
It also seems likely that we are on the verge of major actions reforming the property tax
system in the 1997 Legislature. Individuals of both parties are now proposing legislation
that would eliminate HACA aid, currently $1.8 million for Plymouth. Our growth
revenues will also decline substantially within the next several years if we choose not to
move the MUSA line anytime soon. We have about a two year supply of residential land
at this time. It was only three years ago (1993) that we lost $1 million in tax abatements in
a single year. There may be reasons why we may want to assume the Met Council transit
levy (over $1 million) in the next several years.
Because so many elements of the property tax system in Minnesota are beyond our control,
and because a number of major changes in the system and our circumstances seem likely in
the nekt several years, I favor adopting a charter amendment that would enable the Council
to pass its own ordinance requiring a supermajority vote. The charter should provide a
very public and deliberate process for any repeal or amendment of the supermajority
ordinance. I do not believe that the charter needs to provide any specific exceptions for
major changes in circumstances if the Council can amend its own ordinance in the future
after a public prodess. I would therefore suggest consideration of version three attached.
v
CAMPBELL. KNUTSON. SCOTT & FUCHS. P.A May 3.96 9=52 No.003 P.02
CITY OF PLYMOUTHs q
HENNEPIN COUNTY, MINNESOTA
ORDINANCE NO. 96 -
AN ORDINANCE AMENDING THE PLYMOUTH
CITY CHARTER CONCERNING TAXATION
WIIERF,AS, Minn. Stat. § 410.12, Subd. 5 authorizes the City Council to propose-
charter roposecharteramendmentstothevotersbyordinance.
THE CITY OF PLYMOUTH ORDAINS:
SECTION 1. Chapter 7 of the City Charter is amended by adding Section 7.15
to read:
7.15 Increase in Tax Rate.
A two-thirds majority of all members of the Council is required to adopt a tax levy
resolution that increases the City's tax rate over the prior year. Tax rate means the
quotient derived by dividing the City's tax levy by the City's net tax capacity.
5ECTION 2. Effective Date. This ordinance shall. become effective only when
approved by the voters as provided in Minn. Stat. § 410.12, Subd. 4.
ADOPTED by the City Council this
ATTEST:
Laurie F. Ahrens, City Clerk
37599.01.
OVUM
D
day of ,
Joycelyn Tierney, Mayor
CAMPBELL. KNUTSON. SCOTT & FUCHS. P.A May 3 .96 9:53 No.003 P.'03
5AJ ff YIYI
CITY OF PLYMOUTH
HENNEPIN COUNTY, MINNESOTA
ORDINANCE NO. 96 -
AN ORDINANCE AMENDING THE PLYMOUTH
CITY CHARTER CONCERNING TAXATION
VaMREAS, Minn. Stat. § 410.12, Subd. 5 authorizes the City Council to propose
charter amendments to the voters by ordinance.
THE CITY OF PLYMOUTH ORDAINS:
SECTION 1. Chapter 7 of the City Charter is amended by adding Section 7.15toread:
7.15 Increase in Tax Rate.
The Council may by ordinance require a two-thirds majority of all members of the
Council to adopt a tax levy resolution that increases the City's tax rate over the prior
year. Tax rate means the quotient derived by dividing the City's tax levy by the City's
net tax capacity. The ordinance, if adopted, shall provide that a simple majority of all
members of the Council may adopt a tax levy resolution that increases the City's tax rateunderanyofthefollowingcircumstances:
a) if the City's state aid (i.e., local government aid and homestead and
agricultural aid) has been reduced by twenty percent (20%) or more from
the prior year;
b) if the City's net tax capacity has been reduced by more than tca percent10 %) from the prior year.
The ordinance, once adopted, may not be repealed or amended without a public
hearing following two (2) publications in the official newspaper stating the time, place, and purpose of the hearing. The two (2) publications shall be . a week apart and the
hearing shall be at least three (3) days after the last publication.
37599.03
05/03/95
LHMNBELL. KNU15UN. 5LUII 6 FULHS. F.H Mdg 0.'JO 'J;Zo,) NO.UUS V.04
re ood
sEC][jQN 2. llffective Date. This ordinance shall become effective only when
approved by the voters as provided in Minn. Stat. § 410.12, Subd. 4.
ADOPTED by the City Council this day of
Joycelyn Tierney, Mayor
ATTEST:
I.nurie F. Ahrens, City Clerk
3n99.0
OSlOS/96
05/08/96 11:24 %'612 452 5550 CAMPBELL KNUTSON 444 PLYMOUTH 002/002-
CITY OF PLYMOUTH / 51A,
14ENNEPIN COUNTY, MINNESOTA
ORDINANCE NO. 96 -
AN ORDINANCE AMENDING THE PLYMOUTH
CITY CHARTER CONCERNING TAXA'T'ION
PREAMBLE
VvMREAS, Minn. Stat. § 410.12, Subd. 5 authorizes the City Council to propose
charter amendments to the voters by ordinance.
THE CITY OF PL YMOUTH ORDAINS:
SEC'T'ION 1. Chapter 7 of the City Charter is amended by adding Section 7.15
to read:
7.15 Increase in Tax Rate.
The Council may by ordinance require a two-thirds majority of all members of the
Council to adopt a tax levy resolution that increases the City's tax rate over the prior
year. Tax rate means the' quotient derived by dividing the City's tax levy by the City's
net tax capacity. The ordinance, if adopted, may not be repealed or amended without a
public hearing following two (2) publications in the official newspaper stating the time,
place, and purpose of the hearing. The two (2) publications shall be a week apart and the
hearing shall be at least three (3) days after the last publication.
LECTION 2. Effective Date. This ordinance shall become effective only whenapprovedbythevotersasprovidedinMinn. Stat. § 410.12, Subd. 4.
1996.
ADOPTED by the City Council. this
ATTEST:
Laurie F. Ahrens, City Clerk
37599.06 '
OS/06/g6
day of
7oycelyn Tierney, Mayor
F•
1
a-
410.12 CLASSIFICATION; CHARTERS
410.12 AMENDMENTS.
95' 462
Subdivision 1. Proposals. The charter commission may propose amendments to
such charter and shall do so upon the petition of voters equal in number to five percentofthetotalvotescastatthelastpreviousstategeneralelectioninthecity. If the cityhasasystemofpermanentregistrationofvoters, only registered voters are eligible tosignthepetition. All petitions circulated with respect to a charter amendment shall beuniformincharacterandshallhaveattachedtheretothetextoftheproposedamend- ment in full; except that in the case of a proposed amendment containing more than1,000 words, a true and correct copy of the same may be filed with the city clerk, andthepetitionshallthencontainasummaryofnotlessthan50normorethan300wordssettingforthinsubstancethenatureoftheproposedamendment. Such summary shall
contain a statement of the objects and purposes of the amendment proposed and an
outline of any proposed new scheme or frame work of government and shall be suffi- cient to inform the signers of the petition as to what change in government is soughttobeaccomplishedbytheamendment. The summary, together with a copy of the pro-
posed amendment, shall first be submitted to the charter commission for its approvalastoformandsubstance. The commission shall within ten days after such submissiontoit, return the same to the proposers of the amendment with such modifications instatementasitmaydeemnecessaryinorderthatthesummarymayfairlycomplywiththerequirementsabovesetforth.
Subd. la. Alternative methods of charter amendment. A home rule charter may beamendedonlybyfollowingoneofthealternativemethodsofamendmentprovidedinsubdivisionsIto7.
Subd. 2. Petitions. The signatures to such petition need not all be appended to onepaper, but to each separate petition there shall be attached an affidavit of the circulator
thereof as provided by this section. A petition must contain each petitioner's signatureininkorindeliblepencilandmustindicateafterthesignaturetheplaceofresidencebystreetandnumber, or other description sufficient to identify the place. There shall
appear on each petition the names and addresses of five electors of the city, and on eachpaperthenamesandaddressesofthesamefiveelectors, who, as a committee of the
petitioners, shall be regarded as responsible for the circulation and filing of the petition. The affidavit attached to each petition shall be as follows:
State of ..................... )
ss.
Countyof ................. )
being duty sworn, deposes and says that the affiant and the affi-
ant only, personally circulated the foregoing paper, that all the signatures appended
thereto were made in the affiant's presence, and that the affiant believes them to be the
genuine signatures of the persons whose names they purport to be.
Signed............................
Signature of Circulator)
Subscribed and sworn to before me
this ....... day of ...... 19 ....
Notary Public (or other officer)
authorized to administer oaths
The foregoing affidavit shall be strictly construed and any affiant convicted ofswearingfalselyasregardsanyparticularthereofshallbepunishableinaccordancewithexistinglaw.
Subd. 3. May be assembled as one petition. All petition papers for a proposed
amendment shall be assembled and filed with the charter commission as one instru-
ment. Within ten days after such petition is transmitted to the city council, the city clerkshalldeterminewhethereachpaperofthepetitionisproperlyattestedandwhetherthePetitionissignedbyasufficientnumberofvoters. The city clerk shall declare any peti- tion paper entirely invalid which is not attested by the circulator thereof as required
13
462
lendments to
o five percent
ty- If the city
are eligible to
ment shall be
used amend-
ig more than
ity clerk. and
an 300 words
smmary shall
oscd and an
hall be suffi-
ent is sought
Jy of the pro -
its approval
i submission
lifications in
comply with
artier may be
provided in
nded to one
ne circulator
is signature
of residence
There shall
and on each
aittee of the
Shepetition.
and the affi-
1 appended
m Io jX the
3nvicted of
dance with
a proposed
one instru-
ie city clerk
whether the
re any peti-
as required
CLASSIFICATION; CHARTERS 410.12
463 ,
in this section. Upon completing an examination of the petition, the city clerk shall cer- tify the result of the examination to the council. If the city clerk shall certify that the
petition is insufficient the city clerk shall set forth in a certificate the particulars in i
which it is defective and shall at once notify the committee of the petitioners of the find-
ings. A petition may be amended at any time within ten days after the making of a cer-
tificate of insufficiency by the city clerk, by filing a supplementary petition upon
additional papers signed and filed as provided in case of an original petition. The city
clerk shall within five days after such amendment is filed, make examination of the
amended petition, and if the certificate shall show the petition still to be insufficient,
the city clerk shall file it in the city clerk's office and notify the committee of the peti-
tioners of the findings and no further action shall be had on such insufficient petition. !
The finding of the insufficiency of a petition shall not prejudice the filing of a new peti-
tion for the same purpose.
Subd. 4. Election. Amendments shall be submitted to the qualified voters at a gen-
oral or special election and published as in the case of the original charter. The form
of the ballot shall be fixed by the governing body. The statement of the question on the
ballot shall be sufficient to identify the amendment clearly and to distinguish the ques-
tion from every other question on the ballot at the same time. If 51 percent of the votes
cast on any amendment are in favor of its adoption, copies of the amendment and cer-
tificates shall be filed, as in the case of the original charter and the amendment shall ; Itakeeffectin30daysfromthedateoftheelectionoratsuchothertimeasisfixedin
the amendment. -
Subd. 5. Amendments proposed by council. The council of any city having a home
rule charter may propose charter amendments to the voters by ordinance. Any ordi-
nance proposing such an amendment shall be submitted to the charter commission.
Within 60 days thereafter, the charter commission shall review the proposed amend-
ment but before the expiration of such period the commission may extend the time for
review for an additional 90 days by filing with the city clerk its resolution determining
that an additional time for review is needed. After reviewing the proposed amendment,
the charter commission shall approve or reject the proposed amendment or suggest a
substitute amendment. The commission shall promptly notify the council of the action
taken. On notification of the charter commission's action, the council may submit to i ° I
the people, in the same manner as provided in subdivision 4, the amendment originally T
proposed by it or the substitute amendment proposed by the charter commission. The
amendment shall become effective onlywhen approved b the voters as provided in I'
PP Y
subdivision 4. If so approved it shall be filed in the same manner as other amendments.
Nothing in this subdivision precludes the charter commission from proposing charter '
1
amendments in the manner provided by subdivision 1.
I '
Subd. 6. Amendments, cities of the fourth class. The council of a city of the fourth
class having a home rule charter may propose charter amendments by ordinance with-
out submission to the charter commission. Such ordinance, if enacted, shall be adopted
by at least a four-fifths vote of all its members after a public hearing upon two weeks'
published notice containing the text of the proposed amendment and shall be approved
by the mayor and published as in the case of other ordinances. The council shall submit
I '
the proposed amendment to the people in the manner provided in subdivision 4, but Inotsoonerthanthreemonthsafterthepassageoftheordinance. The amendment
becomes effective only when approved by the voters as provided in subdivision 4. If
so approved, it shall be filed in the same manner as other amendments.
Subd. 7. Amendment by ordinance. Upon recommendation of the charter commis-
sion the city council may enact a charter amendment by ordinance. Such an ordinance,
if enacted shall be adopted by the council by an affirmative vote of all its members after
a public hearing upon two weeks' published notice containing the text of the proposed
amendment and shall be approved by the mayor and published as in the case of other
ordinances. An ordinance amending a city charter shall not become effective until 90
days after passage and publication or at* such later date as is fixed in the ordinance.
Within 60 days after passage and publication of such an ordinance, a petition request- I ;
sill ilgol Z
410.12 CLASSIFICATION; CIIARTERS S/5/
464
ing a referendum on the ordinance may be filed with the city clerk. Such petition shall
be signed by qualified voters equal in number to two percent of the total number of
votes cast in the city at the last state general election or 2,000, whichever is less. If the
city has a system of permanent registration of voters, only registered voters are eligible
to sign the petition. If the requisite petition is filed within the prescribed period, the
ordinance shall not become effective until it is approved by the voters as in the case
of charter amendments submitted by the charter commission, the council, or by peti-
tion of the voters, except that the council may submit the ordinance at any general or
special election held at least 60 days after submission of the petition, or it may recon - 1 : Sider its action in adopting the ordinance. As far as practicable the requirements ofsub-
divisions I to 3 apply to petitions submitted under this section, to an ordinance
amending a charter, and to the filing of such ordinance when approved by the voters.
S• History: (1286) RL s 756; 1907 c 199 s 1; 1911 c 343 s 1. 1939 c 292 s 1; 1943 c 227j
sl. 1949 c 122 s 1; 1959 c 305 s 3,4; 1961 c 608 s 5,6; 1969 c 1027 s 3; 1973 c 503 s 1-4;
1986 c 444
410.121 SALE OF INTOXICATING LIQUOR OR WINE; FAVORABLE VOTE.
If the charter which is to be amended or replaced contains provisions which pro-
hibit the sale of intoxicating liquor or wine in certain areas, such provisions shall not
be amended or removed unless 55 percent of the votes cast on the proposition shall be
in favor thereof.
History: 1969 c 1027 s 2 -
410.13 [Repealed, 1959 c 305 s 6]
410.14 ALTERNATIVE PROPOSALS.
In submitting a charter or an amendment to the voters any alternative section or
article may be presented and voted on separately, without prejudice to other articles
or sections of the charter or any amendments thereto.
History: (1288) RL s 757
Iff 410.15 SUCCESSION; SUBSISTING RIGHTS.
The new city so organized shall be in all respects the legal successor of the former
corporation, and no charter so adopted, nor any amendment thereof, shall prejudice
any subsisting right, lien or demand against the city superseded, or of%ct any pending
action or proceeding to enforce the same. All rights, penalties, and forfeitures accrued
of accruing to such former corporation, all property vested therein or held in trust
therefor, all taxes and assessments levied in its behalf, and all its privileges and immuni-
ties not inconsistent with the new charter, shall pass to its successor. All ordinances,
resolutions, and bylaws in force at the adoption of such new charter, and not in conflict
with its provisions, shall continue in force until duly altered or repealed.
History: (1289) RL s 758, 1973 c 123 art 5 s 7
410.16 FORMS OF GOVERNMENT INCORPORATED IN CHARTER.
The charter commission may incorporate as part of the proposed charter for any
city the commission, mayor -council, council-manager form of city government or any
other form not inconsistent with constitution or statute, and may provide that all elec-
tive city officers, including mayor and members of the council, shall be elected at large
or otherwise.
History: (1290) 1909 c 170 s 1; 1959 c 305 s 5; 1961 c 608 s 7
410.17 [Repealed, 1973 c 503 s 6]
410.18 DISTRIBUTION OF ADMINISTRATIVE POWERS.
Such charter commission may also provide that the administrative powers, author,
Ir
Regular Council )`.Meeting
May 15, 1996
Page 9
Motion was made by Councilmember Anderson; seconded by Coudcilmember
Black, to adopt RESOLUTION 96-286 A/
SISTANCE
T CITY
MANAGER TO APPLY TO THE DEPADE AND
ECONOMIC DEVELOPMENT AND EEMENTS FOR
FUNDING OF THE VALUE RX PROJELF OF THE
CITY OF PLYMOUTH;
RESOLUTION 96-287 OF ADOPTIONIAL
ANTIDISPLACEMENT, RELOCATIOAND
DISPLACEMENT MINIMIZATION PL
RESOLUTION 96-288 PRELIMINAY APPROVAL OF PLYMOUTH
ECONOMIC DEVELOPMENT F`1ND GUIDELINES.
Motion carried, six ayes.
Item 7-11 Vacation in Pheasant Tr s Addition
Public Works Director or presented the staff report on the request for
vacation of part of53 Avenue street right-of-way in Pheasant Trails
Addition.
Deputy Mayo ymangood opened the public hearing at 7:38 p.m. No one
appeared, a the hearing was closed.
P/
MOTI was made by Councilmember Wold, seconded by Councilmember
re, to adopt RESOLUTION 96-289 AUTHORIZING THE
V CATION OF PART OF 53RD AVENUE STREET RIGHT-OF-WAY.
otion carried, six ayes.
Item 8 -Al (9-A) Ordinance Initiating a City Charter Amendment
Motion was made by Councilmember Preus, seconded by Councilmember
Wold, to adopt ORDINANCE 96-9 AMENDING THE PLYMOUTH
CITY CHARTER CONCERNING TAXATION.
Councilmember Preus explained that this was a campaign issue supported by
three councilmembers in the last election. The ordinance proposes a City
Charter amendment to require a 5/7 vote of the City Council to raise the City's
tax rate in any fiscal year. If adopted, the ordinance will be forwarded to the
Charter Commission for review. The Charter Commission can propose an
alternative to the initiative if it wishes. The City Council can then choose
between its own initiative and that of the Charter Commission to select which
version is presented to the voters. Councilmember Preus stated that this
initiative would make it more difficult to increase the tax rate in the future. He
b
12
Regular Council Meeting
May 15, 1996
Page 10
stated that the City Council, City Manager and staff have done a good job of
reducing the tax rate over the last several years. The City currently has the
lowest tax rate in Minnesota of cities with over 10,000 population. This
charter amendment would demonstrate that an increase of the City's tax rate
deserves more attention than a simple majority vote.
Manager Johnson reviewed possible alternative ordinances. One alternative
would be to amend the Charter to enable the Council to pass its own
ordinance, but with conditions in the charter about how the ordinance applies
and how it may be repealed. For example, the ordinance requiring a
supermajority could apply in all situations except where the City loses at least
20 percent of its state aid or loses more than 10 percent of its net tax capacity.
Another alternative would be to expand those situations to also accommodate
both state legislative changes and substantial economic devaluations.
Councilmember Granath supported the motion. He stated that it will be more
difficult for future Councils to maintain the City's low tax rate when faced with
declining revenues. Citizens and future City Councils and staff will be
encouraged to do hard planning to keep the tax rate low.
Motion carried, six ayes.
Item 8-A2 (6-H) Concept Plan for Holly Creek 5th Addition (96005).
Community Development Director Hurlburt reviewed the application o
Scherber Partnership Properties/Loucks and Associates, Inc., for Pl ed Unit
Development Concept Plan for Holly Creek 5th Addition locate orth of 39th
Avenue and west of Dunkirk Lane. She stated that a second ' m relates to the
wetland plan based on the proposed concept plan.
Director Hurlburt stated that the applicant has requ ted consideration of the
concept plan first, and separately, from the preli nary plat for Holly Creek 5th
Addition because of the wetland requiremen . She said that reduced wetland
buffers are allowed in some situations, b only if the developer requests
alternative buffers. The developer ha equested alternative buffers in a small
part of the proposed development. he said that at the concept plan stage, the
City Council should consider t generai layout of streets, the request for
alternative buffers, and gen compliance with the City's Comprehensive
Plan. Final grading, det ' ed street design, and erosion control issues would be
considered at later re 'ew stages.
She described a site as a 19.5 acre parcel with three wetland basins. Two of
the basinsXe of medium quality and one is a low quality basin. About .36
acreso etlands is proposed to be filled, with the mitigation on the site at a
2:1 io. The first duty under the Wetlands Act is to avoid wetlands;
CITY OF PLYMOUTH
HENNEPIN COUNTY, IOTA
RESOLUTION NO. 96-9
AN ORDINANCE AMENDING THE, PLYMOUTH
CITY CHARTER CONCERNING TAXATION
PREAMBLE
WHEREAS, Minn. Sta. §410.12, Subd. 5 authorizes the City Council to propose
charter amendments to the voters by ordinance.
THE CITY OF PLYMOUTH ORDAINS:
SECTION 1. Chapter 7 of the City Charter is amended by adding Section 7.15
to read:
7.15 Increase in Tax Rate.
A two-thirds majority of all members of the Council is required to adopt a tax
levy resolution that increases the City's tax rate over the prior year. Tax rate means
the quotient derived by dividing the City's tax levy by the City's net tax capacity.
SECTION 2. Effective Date. This ordinance shall become effective only
when approved by the voters as provided in Minn.= Stat. §410.12, Subd. 4.
ADOPTED by the City Council this 15th Day of May, 1996.
ATTEST:
Laurie F. Ahrens, City Clerk
ce n T' rney, Mayor
IS
la
Plymouth Charter Commission
May 23, 1996
Minutes
Present: Virgil Schneider, Jon Speck, John Duntley, Tim Peterson, Dave Crain,
Dave Pauba, Joy Tierney, Bob Sipkins, Kapila Bobra, Ty Bujold,
Ellie Singer, Assistant City Manager Kathy Lueckert
Excused: Sandy Patterson, Bill Pribble
Absent: Pauline Milner
Virgil Schneider called the meeting to order at 7:05 PM.
d) W
5131/1
Virgil Schneider explained the purpose of the meeting. He stated that several issues were
referred to the Charter Commission in recent weeks. He determined that there was a need
for a meeting in May, even though this date was somewhat past the deadline set by the
Commission in December 1995. Mr. Schneider stated that the Commission must consider
two issues for possible charter amendments: requiring a supermajority vote for a tax rate
increase, and regulating council attendance.
Sunermaiority Vote for Tax Increase
Assistant Manager Lueckert explained the statutory provisions for amending the Charter.
She'stated that the City Council passed an ordinance specifying the amendment language
for the November ballot. Ms. Lueckeft stated that it is very likely that this proposed
amendment will be on the ballot in November. She referred the Commission to the staff
report on this subject for the May 15 City Council meeting, which outlined the options
available to the Council.
Joy Tierney stated that the City Council was given three options, but chose the stronger
language. She stated that the Charter Commission had considered supermajority vote
requirements when the charter was drafted.
Dave Crain expressed concern that a supermajority vote on a tax rate increase would give
control of the budget to a minority, and that deadlocks could result. Virgil Schneider
stated that he doesn't remember a time when the budget was adopted without a
supermajority vote; Dave Crain concurred. Ms. Lueckert shared a spreadsheet showing
the ten year history of budget votes, which supported Mr. Schneider's and Mr. Crain's
recollections.
Joy Tierney stated that she is concerned about too many supermajority vote requirements.
There may be unintended consequences for other cities who may follow Plymouth's lead
but not have the benefit of the revenues which come from growth. Ty Bujold stated that
government should be run by the majority, and questioned the wisdom of singling out
issues for a supermajority requirement.
I9
Bob Sipkins asked if the requirement for a supermajority vote on a tax rate increase was acampaignissue. Virgil Schneider stated that several candidates had highlighted this issueduringtheFall1995campaign. Mr. Schneider stated that setting the tax rate is asignificantissue, not unlike rezonings. In his opinion, a council must have a compellingreasontoraisetaxes. He stated that he thinks most voters would vote for such anamendment.
Tim Peterson stated that the budget vote history shows no pattern of problems. Hewonderediftheissuereallyneeded "fixing."
John Duntley stated that he wondered about the merits of discussing this issue more in amorepublicfashion, and he felt that more information was needed for the Commission andforthepublic. Ty Bujold pointed out that the state law section gives the Commission aninitialsixtydayreviewperiod, and then permits the Commission to consider the issue for
another ninety days. Ty Bujold stated that he feels that the additional time will be needed,
and that time and energy is needed to make certain the electorate is informed about thisissue.
John Duntley stated that he also feels that the Commission needs to gather data, and tohearallviewpointsonthesupermajorityvoteissue. Mr. Duntley stated that after theCharterCommissioniscomfortablewithallaspectsoftheissue, public meetings should beheld. Jon Speck stated that the Charter Commission had turned down the idea of a
supermajority vote on the budget when the charter was drafted. He stated that he felt thatthecommissionhadgoodreasonsfordoingso.
Virgil Schneider stressed the importance of keeping an open mind about this issue. Mr. Schneider suggested that the Commission invite the City Council to the next CharterCommissionmeeting. At'this meeting, councilmembers could articulate their position onthesupermajorityvotequestion, and commission members could ask questions. He statedthatcommissionmembersshouldcometothismeetingwiththeirquestionsprepared.
Ellie Singer moved, seconded by Kapila Bobra, that the Charter Commission meetonTuesday, July 9, 1996 at 7 PM to consider the supermajority vote issue, and thattheCityCouncilbeinvitedtoattendthismeeting. The motion carried.
The Charter Commission directed Kathy Lueckert to gather the following information: research supermajority vote requirements in other charters, find out ballot printingdeadlines, seek an opinion from Springsted about the impacts of a supermajority vote onthecity's bond rating, and consider inviting city managers from other cities to give theirPerspectiveonsupermajorityvotes.
Council Attendance
Joy Tierney gave a brief overview of the issue of councilmember attendance. Sheexplainedthepreviousordinancerequirementsandhighlightedthechangeswhich were
0
Minutes
Regular Council Meeting
June 5, 1996
The regular meeting of the Plymouth City Council was called to order bayor Tierney
at 7:00 p.m., in the Council Chambers, 3400 Plymouth Blvd., on Ju ' 1996.
COUNCIL PRESENT: Mayor Tierney; Councilmembers B ck, Anderson, Wold,
Lymangood, Preus, and Granath.
ABSENT: None.
STAFF PRESENT: City Manager Jo on, Assistant City Manager Lueckert, Public
Works Director Moore, Commun' evelopment Director Hurlburt, Finance Director
Hahn, Park Director Blank, P is Safety Director Gerdes, City Attorney Knutson, and
City Clerk Ahrens.
Item 3 Plvntsfitli Forum
I
ne appeared for the Forum.
Item 5 Approve Agenda
Councilmember Lymangood requested that the minutes of the Charter
Commission meeting of May 23 be added to the agenda as Item 9-C.
Motion was made by Councilmember Lymangood, seconded by
Councilmember Granath, to approve the agenda with the addition of Item 9-C.
Motion carried, seven ayes.
Item 6 Consent Agenda
Councilmember Lymangood noted that a clarification has been madA ouncilstaffreportforItem6-E and a correction made to the May 20 C'
Special Meeting minutes. These items were noted and rem ' ed on the
consent agenda. Items 6-F and 6-K were removed fro a Consent Agenda.
Motion was made by Councilmember Ande n, seconded by Councilmember
Preus, to approve the consent agenda mended. Motion carried, seven ayes.
Item 6-A Approve City C>
by
Mi es
Motion was madncilmember Anderson, seconded by Councilmember
Preus, toapprovnutes of the May 15 Regular Council Meeting,
May 20 Bo of Review, and the May 20 Special Council Meeting as
correc Motion carried, seven ayes.
91
Regular Council Meeting
June 19, 1996
Page 10
suggested that Plymouth could share its experience with the sump pum
ordinance or other technical expertise on this issue with those uniti
Motion was made by Councilmember Lyman , seconded by
Councilmember Wold, to adopt RES ION 96-338 AUTHORIZING
THE FINANCE DIRECTO SUBMIT A LOAN APPLICATION TO
THE METROPOL COUNCIL ENVIRONMENTAL SERVICES,
and directs o communicate with the cities of Medina and Medicine
ke lee City's willingness to work with them on addressing sewage flow
m their communities. Motion carried, six ayes.
Item 8-C Plymouth Charter Commission Minutes
Councilmember Lymangood referenced the Plymouth Charter Commission
minutes of May 23, 1996. He noted that a motion was adopted `that the
Charter Commission meet on Tuesday, July 9, 1996 at 7 p.m. to consider the
supermajority vote issue, and that the City Council be invited to attend this
meeting." He expressed concerns with this action. He believes that there
could be a blurring of responsibilities in a joint meeting of the Charter
Commission and City Council, and he is hesitant to engage in such a meeting.
He viewed the Charter Commission as similar to a constitutional congress,
with powers not to implement change, but to make recommendations on
amendments to the City Charter. He is concerned that the City Council, an
elected body required to abide by the City Charter, would meet with the
Charter Commission to debate the issues. From a practical perspective, the
City Council has already adopted wording for a proposed Charter amendment
and he believes the issue is very clear. He expressed concern that the Charter
Commission has an opportunity to delay the process of getting the amendment
to the voters this November. Councilmember Lymangood stated he will not
participate in the meeting unless it is a televised public hearing, and he would
still have concerns about blurring of responsibilities.
Councilmember Preus had similar observations. He would be happy to attend
the Charter Commission meeting to give an explanation of his views on the
issue, but doesn't believe that the City Council should be jointly meeting with
the Charter Commission. He believes this issue is very clear and is concerned
that the Charter Commission members indicated they may need. more time to
address it. He hoped that the Charter Commission does not delay the issue
further. The Charter Commission should either agree with the language
proposed by the Council, or recommend some other option.
Mayor Tierney asked the City Attorney if there is difficulty under a Council -
Manager form of government of having a joint City Council and Charter
Commission meeting.
207
Regular Council Meeting
June 19, 1996
Page 11
Attorney Knutson said there is no legal problem with such a meeting, but
councilmembers may have philosophical issues.
Mayor Tierney explained that the Charter Commission discussed the issue of
supermajority votes several years ago and decided that they did not want this
included in the Charter. The Charter Commission felt that, rather than take the
issue immediately to a public meeting, it would be good to hear from
Councilmembers on why they favor this amendment. The Charter Commission
noted that there was not much discussion among the Council on the issue,
other than to indicate support for the amendment. They would like to have a
clear understanding of why the City Council wants the amendment; therefore,
they would like to hold a meeting with the Council before a public hearing is
scheduled.
Councilmember Wold stated it is his understanding that the job of the
Commission is to oversee the Charter. The Charter Commission should be
paying close attention to the Council meetings in order to do so. He assumed
that the Charter Commission received the minutes of the City Council meeting
where the amendment language was adopted, and that they had access to theCouncilmemberdebateslastfallwhentheissuewasfirstraised. He feels that
the issue is perfectly clear, and he feels it is disconcerting that the will of the
Council wasn't clear when a member of the Council was present at the Charter
Commission meeting. Councilmember Wold stated that before voting on the
proposed amendment language, Councilmembers made it clear that raising
taxes is something that deserves more than a simple majority vote. He feels
that a meeting with the Charter Commission would serve no purpose because
the City Council's position is on public record and they would only restate thepositionthathasbeenadopted.
Councilmember Lymangood suggested that perhaps the Charter Commission
should just conduct a public hearing. He stated that three members of the CityCouncilmadethesupermajority'vote for increasing the tax rate a campaign
issue. He believes that the City Council has exercised leadership, and he
requested that the Charter Commission allow the voters to act on it in 1996.
Councilmember Preus noted that the minutes of the Charter Commission
meeting reflect different views on this issue. The Charter Commission can vote
to agree or not agree with the City Council's proposed amendment language,
but there is no reason to delay action.
Mayor Tierney stated that most of the Charter Commission members don't
believe the supermajority vote issue is as simple as it looks. TheCommissionersrecognizethatthiswasacampaignissue, but now they want toknowiftheamendmentisinthebestinterestoftheCity. She stated that the
3
Regular Council Meeting
June 19, 1996
Page 12
Charter Commission attorney was denied payment for three months by the
previous City Council. The Charter Commission wants the City Council to
meet with them. Mayor Tierney stated she was not present at the City Council
meeting on May 15 when the proposed amendment language was adopted.
She suggested that he joint Charter Commission and City Council meeting
could be videocast. Mayor Tierney noted there is a current vacancy on the
Charter Commission and questioned whether any councilmembers had
submitted their application of interest.
Assistant Manager Lueckert stated that it would not be possible to televise a
joint meeting on July 9 because a Planning Commission meeting is scheduled.
Councilmember Lymangood stated that he has consciously not submitted an
application to serve on the Charter Commission. He has no desire to serve as a
Charter Commission member as long as he is in elected office. He believes that
the Charter Commission is intended to be an independent body and that
philosophical issues could be mixed by serving in both roles.
Councilmember Wold stated that he does not believe it is appropriate to serve
as a Councilmember and also on the Charter Commission that establishes the
tales" through the City Charter.
Mayor Tierney stated that the Charter Commission doesn't know whether the.
desire to require a supermajority vote for a tax increase is just a political idea
supported by council candidates or whether it has good reason. She said there
is no legal restriction that a councilmember cannot also serve on the Charter
Commission. She was a member of the Charter Commission before becoming
a Councilmember.
Councilmember Wold stated that the City Council believes the supermajority
vote requirement would be good public policy.
Motion was made by Councilmember Lymangood, seconded by
Councilmember Granath, that the Plymouth City Council agrees that a 5/7
supermajority vote requirement in order to raise the tax rate is good public
policy for the citizens of Plymouth, that the City Council encourages the
Charter Commission to act forthwith in addressing the issue so that the citizens
have an opportunity to vote on the issue in 1996, and to suggest that the
Charter Commission can conduct a public hearing if they wish additional input
on the issue.
Councilmember Preus supported the motion. He stated that the issue was
raised during the ca,tipaign because it is good government policy. Six
gq
Regular Council Meeting
June 19, 1996
Page 13
Councilmembers voted in favor of the Charter amendment language, and the
issue should go to the voters for a decision this November.
Councilmember Black said that she supported the supermajority requirement as
part of her campaign and believes voters should be allowed to decide if a tax
rate increase is more important than other city business.
Mayor Tierney stated that one issue is the concern of whether there should
ever be a supermajority vote requirement because it can turn decisions over to
a minority. She will not support the motion because she has not been shown
evidence that requiring a supermajority vote for a tax rate increase is good
government.
Motion carried, five ayes; Tierney nay.
Councilmember Wold called for division.
Motion carried on a roll call vote: Wold, Lymangood, Preus, Granath, Black
ayes; Tierney nay.
Item 8-1) Weston Corporation, The Courts at Nanterre (96023)
Community Development Director Hurlburt presented the staff report on e
request of Weston Corporation for residential planned unit developme
preliminary plan/plat, conditional use permit and variances for The ourts at
Nanterre located west of Vicksburg Lane and north of the Holl ale Golf
Course. The Planning Commission recommended approval, en denial, on a
vote of 3 to 3. The item is sent to the Council without a commendation from
the Planning Commission.
She stated that The Courts at Nanterre is a pro sed 37 -unit townhome
project located in the Nanterre planned unit velopment, for which concept
plan approval was given by the City in 19 The single family part of the
project has been given final approval. irector Hurlburt stated that the issue of
the type of fencing along the Holl ale Golf Course has been resolved since the
Planning Commission meeting the satisfaction of all parties. Another
concern was the setback fro the Soo Line Railroad. Staff believes that there
is sufficient buffer for th nits_
XCOMMurnuftyeve ment Director Hurlburt stated that an issue of staff
r ated to the road system in the development. The developer
a combination of public streets and private drives. Schmidt Lake
tock Lane, and 49th Place would be public streets. There would
te driveways to serve clusters of two to three townhomes each,
ional private driveway on the east side of Comstock Lane. She
as'
Regular Council Meeting
June 26, 1996
Page 13
Councilmember Granath said that he added this item to the agenda for a statu
report from the City Manager. He applauded the intention of Mayor Schr er
and the Medicine Lake City Council to work with Plymouth on issues r ted
to South Shore Drive. He encouraged them to consider the issues a eir July
1 Council meeting. If the Medicine Lake City Council is prepare o take
action as requested by the City of Plymouth, he doesn't believ hat it is
essential that a meeting be held. He said it is in the interest f both
communities to resolve these issues.
Councilmember Anderson stated that he will notend the Medicine Lake City
Council meeting. The Plymouth Council has e ectively resolved issues
through established subcommittees. He to exception to several sentences of
Mayor Schrader's letter. Councilmemb Anderson stated that the Plymouth
City Council has set a deadline of the nd of July. He would like to see action
by that time, or he would expect uncilmember Granath to place the closure
of South Shore Drive on the nda for consideration. He will seriously
consider th/ifthi further occurs by that time.
Councilmeated that the July 1 meeting is where the City of
Medicine Lscuss their options. Plymouth councilmembers are not
needed forn. She stated that the Subcommittee can meet with
the Mediciouncil, once they decide how to proceed.
Coun ' member Wold stated that the Subcommittee has his full support. He
be ' ves the Subcommittee can work with Medicine Lake Council to reach a
ompromise by the end of July.
Item 9-13 Charter Commission Request
Councilmember Black acknowledged that there are various points of view on
the issue relating to requiring a supermajority vote for a tax rate increase. She
suggested that one Councilmember be appointed to attend the Charter
Commission meeting to present the City Council's position and to enter into a
discussion with the Charter Commission on the issue. Councilmember Preus
has indicated he would be willing to attend the Charter Commission meeting to
do this.
The City Council expressed support for Councilmember Preus attending the
Charter Commission meeting and representing the position of the City Council.
Mayor Tierney stated she would like to see more councilmembers interested in
the various charter issues. She said that the Charter Commission has
previously discussed these issues.
94
Regular Council Meeting
June 26, 1996
Page 14
Councilmember Black stated that she believes the Charter Commission has a
mission and a specific role to play, and the interference of the Council is
unnecessary. However, she believes it would be useful to have one
councilmember present the Council's position at the Charter Commission
meeting.
Councilmember Lymangood agreed that this was a worthy compromise. He
said that the City Council has also indicated they would meet with the Charter
Commission at a public hearing on the issue.
Item 9-C Tobacco Ordinance
Councilmember Lymangood reported that an article r>
iordinance
City's
Tobacco Ordinance recently appeared in USA Today. ed the
Public Safety Director. He acknowledged the work oanager,
Public Safety Director, and City Attorney on developiand
receiving nationwide attention on this issue.
Councilmember Wold reported that yesterdayfre attended a meeting on the
City's tobacco ordinance. He stated tha ne panel member was impressed
with the resolve of the Council in a ting the ordinance, and the forum was
very positive.
Councilmember Anderson left the eeting at 9:00 p.m.
Public Safet erector Gerdes explained that the City hosted a prevention
forumfo sing on the scenario that "It's too easy for kids to buy tobacco in
HqeRdpin County." The Plymouth ordinance was highlighted and the meeting
v fas well received.
N ion was made by Councilmember Black, seconded by Councilmember Lymangood to
adjourn the meeting at 9:05 p.m. Motion carried, five ayes.
Laurie Ahrens
City Clerk
a;
Plymouth Charter Commission
July 9, 1996
Minutes
Present: Virgil Schneider, Dave Pauba, Ty Bujold, John Duntley, Dave Crain, Bob
Sipkins, Tim Peterson, Jon Speck, Joy Tierney, Kapila Bobra, Ellie
Singer, Councilmember Christian Preus, Assistant City Manager Kathy
Lueckert
Excused: Bill Pribble, Pauline Milner, Sandy Patterson
Call to Order
Virgil Schneider called the meeting to order at 7:02 PM. Virgil Schneider
introduced Councilmember Christian Preus, and the Charter Commission introduced
themselves.
Approval of Minutes
The minutes of the May 23, 1996 Charter Commission meeting were approved as
presented.
Old Business
Supermajority Vote for Tax Rate Increase
Virgil Schneider asked if any commission member needed a report from staff;
none indicated that they did. Virgil Schneider asked that commission members ask
questions of Councilmember Preus.
Dave Pauba asked Councilmember Preus why he thought requiring a
supermajority vote was a good idea.
Councilmember Preus stated that he is looking toward the future, and that is why
he is proposing the supermajority vote. He said that right now the city has no fiscal
problems, that it has good budgets and the tax rate has declined in recent years.
However, he is wary of what actions the federal and state governments may take which
may force local governments to provide services that have not previously been their
purview. Councilmember Preus stated that he fears that these services could be a
tremendous burden, and that the city should consider carefully whether or not it wants to
increase taxes to provide them. He stated that City Manager Dwight Johnson had several
good ideas on how to approach the supermajority vote, such as the Charter enabling the
City Council to adopt an ordinance dealing with a supermajority vote on a tax rate
increase. Councilmember Preus stated that he felt this might lead to tinkering with the
ordinance from one year to the next, and that the Charter requirement should be for a
supermajority vote or none at all. He said that he is not afraid of a "tyranny of a
minority." He has not seen that come to be during his tenure on the Planning
Commission or the City Council.
zt
Virgil Schneider stated that the current requirements for a supermajority vote are
for rezonings and reguidings.
Kapila Bobra asked Councilmember Preus why he thought Plymouth needed a
supermajority vote for a tax rate increase when other cities and counties do this by a
simple majority vote.
Christian Preus stated that he is looking to the future, and that other local
governments may not be wary of what the federal and state levels might do. He says it is
simply a different approach.
Joy Tierney stated that the Charter Commission also is concerned about taxes, but
the city's record on holding the line on taxes has been good. She said that the
supermajority vote is an issue of giving or not giving control to a minority. She asked
why should action be taken when there does not seem to be a problem in Plymouth.
Councilmember Preus stated that he feels that in the future, an extra vote will
ensure caution when spending money. The fiscal decisions will be harder in the future.
Virgil Schneider said that supermajority votes are required for rezonings and
reguidings because these changes tend to be permanent. He said that the tax rate can
change from year to year and thus is not a permanent change. He stated that elections
also provide an opportunity for a leadership change if voters are not happy with taxes. In
his opinion, raising taxes and rezonings/reguidings are not in the same category.
Councilmember Preus stated that technically Virgil Schneider was right.
However, he stated that experience shows that holding the line on taxes is very difficult at
the state and federal level, and that Plymouth may have the same difficulties in the future.
Dave Crain stated that Virgil Schneider's point was an important distinction. He
stated that Plymouth has enjoyed strong growth revenues and has been "lean and mean"
in providing services. Dave Crain said that this may not be possible in the future. His
main concern is that of minority control. He is concerned about the possibility of never
passing a budget. He is also concerned about the inflexibility of the amendment as
currently drafted, in that five absolute votes are needed. What happens if there is a
vacancy on the council at the time the tax rate must be approved? Virgil Schneider
concurred with Dave Crain's concerns about flexibility and dealing with council
vacancies.
Christian Preus said there have not been problems in the past with taxes, and that
he feels the voters would intervene if there were a problem. He stated that most council
vacancies are temporary. Councilmember Preus stated that if the City Council took the
ordinance approach to a supermajority that there would be too much room for case-by-
case maneuvering and dealmaking.
Virgil Schneider stated that a supermajority vote might result in more dealmaking
than simple majority votes, and that it might not be limited to budget discussions. Ellie
Singer said that the ward system may lend itself to deals. Jon Speck said that one ward,
plus an at -large councilmember and the mayor could control the budget, and lead to one
ward being more powerful than another. Virgil Schneider stated that minority control
may force deals.
Councilmember Preus stated that he does not see that happening in Plymouth. He
wondered if deals might be made more in rezoning situations than in setting the tax rate.
21
Ty Bujold thanked Councilmember Preus for coming to the meeting, and said that
he was glad to hear his comments. Ty Bujold stated that the Charter Commission's role
is not to dictate to the City Council, but to offer other suggestions. He said that the issue
at hand is to place a requirement in the Charter which would tightly control the ability of
a future city council to raise taxes. Does the Charter Commission want to endorse this, or
should it be a legislative decision dependent on the circumstances at the time? Ty Bujold
said that all three possible ordinances considered by the Council dealt with controlling
taxes, and that he can't think of an alternative that the Charter Commission could propose
that the Council would accept.
Tim Peterson expressed an interest in finding some sort of compromise, perhaps
setting benchmarks of changes in the city's fiscal picture which would or would not
activate the supermajority vote requirement.
Councilmember Preus said that future circumstances cannot be predicted.
Dave Crain asked what would happen with the supermajority vote requirement if
the Legislature changes the entire tax system, as happened during the change from mill
rates to tax capacity. He is concerned about the inflexibility of the proposed amendment.
Virgil Schneider asked Councilmember Preus just what the problem is, and what
the issue is that necessitates the supermajority vote proposal.
Councilmember Preus said that it is best to take action prior to actual problems.
He feels that pressure to raise the tax rate will be a future problem, and that it is best to
consider the supermajority issue when there is no immediate pressure and problems.
John Duntley said that the electorate is very sensitive to taxes, and that the City
Council will hear about it. He observed that when it is necessary to raise taxes, councils
tend to vote as a group so all take the pressure.
Jon Speck stated that if the issue is one of control over taxes, then perhaps other
alternatives should be looked at, such as requiring a supermajority vote to adopt the
annual budget. He stated that he doesn't understand why there is such a sense of urgency
to this, and that more study and research is needed.
Tim Peterson said that most voters will think the supermajority requirement is
good, and will vote for it without full knowledge of the pros and cons.
Bob Sipkins stated that Christian Preus and the City Council are to be
commended for a future orientation. He stated, however, that the supermajority
requirement is an easy idea for populists to embrace, but that there may be other solutions
and contingencies to achieve the same goal. He stated that the issue is whether or not the
control should be in the Charter.
Virgil Schneider stated that the Charter Commission can ask for an extension of
90 days, can propose modified language, or can decline to place the amendment on the
ballot. The Council could then place their own version on the ballot.
Kapila Bobra stated that she feels an extension is needed, so that the Charter
Commission can discuss ideas among themselves. She said that the public will think the
supermajority requirement is a good idea, but may not be aware of its practical
applications.
Ellie Singer asked Councilmember Preus if he saw no reasons to delay the
question.
30
Councilmember Preus stated that the ballot deadline is a concern. He said that an
additional 90 days might postpone getting it on the ballot.
Ellie Singer stated that she wants the minutes to reflect that she takes exception to
Councilmember Wold's comments in the city council minutes of June 19. She stated that
the Charter Commission's role is indeed to oversee the charter, and that it is important to
carefully consider changes to the Charter.
Christian Preus stated that he understands that the Charter Commission does not
have much time to consider the language. However, he stated that the Charter
Commission may be making the issue more complicated than it is, and that it is a
questions of being for or against the proposed amendment.
Virgil Schneider stated that a presidential election year might not be the best time
to place charter amendments on the ballot, because of the length of the ballot. He
suggested a gubernatorial year instead.
Ty Bujold stated that he doesn't want an unnecessary delay in getting this issue to
the voter, but that he also feels that the electorate should be informed.
Ty Bujold moved that in accordance with Minnesota Statutes 410.12,
Subdivision 5, the Charter Commission resolves that a 90 day extension is necessary
to fully consider all aspects of the proposed amendment on a supermajority vote
requirement for a tax rate increase, and that a resolution be filed to that effect with
the City Clerk. Dave Pauba seconded the motion.
Virgil Schneider called for discussion on the motion.
Tim Peterson asked what actions the Charter Commission would take during the
next 90 days.
Jon Speck asked for more research on the track record of the City of Fridley,
which requires a supermajority vote to adopt the budget. He also wants more
explanation of the proposed language. Jon Speck also stated that he would like a public
meeting on the proposed amendment.
Dave Crain said that perhaps the Charter Commission should consider a
supermajority vote not only on the tax rate but also on the budget adoption.
Bob Sipkins said that the strongest action would be to go on record as rejecting
the language proposed by the Council.
Kathy Lueckert stated that the ballot language must be finalized by early
September, following the primary election. If the Charter Commission wished to meet
that deadline, a report to the City Council would be due by the September 4 meeting.
Bob Sipkins said that the City Council seems anxious to get this before the
electorate, and that they will see the 90 day extension as an attempt to thwart their efforts.
Thus the strongest action by the Charter Commission may be to reject the proposed
language. He said that he was uncertain what an additional 90 days would do.
John Duntley said that he simply wants more information, and that this may
provide him with a reason to support or to deny the proposal. He said that the issue is a
no brainer" for voters. However, the Charter Commission did consider the
supermajority requirement while drafting the charter, and that there is more below the
surface of the issue.
31
Ty Bujold said that the proposed amendment does not demand immediate action,
and that it doesn't need to be in place immediately.
Joy Tierney said that the issue can use more study, and that an attorney should be
brought in for more suggestions. She stated that she was disappointed that the City
Council did not discuss the issue more, and that the Council did not accept the City
Manager's recommendation.
Ellie Singer observed that six councilmembers are for the amendment. She said
that the Charter Commission serves as an overseer of the charter, and that while it doesn't
make decisions quickly, it does that for a purpose. The Charter Commission is a separate
body, and should not rubber stamp every suggestion by the City Council but consider
each on its merits.
Dave Crain said that the city could be faced with a conundrum. He wondered
what might happen if levy limits were imposed again, and that it would be hard to not
stay at the current tax rate to avoid fiscal difficulties.
Christian Preus observed that the Charter Commission had raised good points. He
stated that if he hadn't come, he would think that the proposed resolution asking for an
extension was a "slap in the face" to the council. He said that there may be the perception
that the 90 day extension was requested just to kill the issue. He asked that the Charter
Commission make a good faith effort to reach a decision in time for the ballot deadline.
Ty Bujold stated that he is not concerned about what the Council thinks of him or
the Charter Commission. He feels that the Charter Commission's responsibility is to take
care of the charter. He stated that more information is needed, and that he cannot
understand the urgency.
Councilmember Preus stated that the lack of verbiage in the minutes does not
mean that the Council did not think carefully about the proposed amendment. He stated
that the Charter Commission has taken an honorable position, and that the Commission is
not responsible to the Council.
Virgil Schneider said that the Charter Commission has already spent nearly three
hours discussing the supermajority vote issue, and that appears to be more time than the
City Council has spent in public discussion of the issue. He stated that the Charter is the
city's constitution, and that it exists in perpetuity and that changes should be carefully
considered.
Councilmember Preus stated that he thinks the Council has considered the issue.
Tim Peterson stated that he agrees with Ty Bujold. He wants a working
relationship with the City Council, but that the council minutes were very strong, and did
not have a conciliatory or diplomatic tone. He said that the tone of the minutes was very
much "we/them." He wants a better relationship with the council, but no
councilmembers had called him or any other commission member. However, he thinks
that Ty Bujold's motion would perpetuate this problem.
Ty Bujold called for the question.
Motion passed, 8 ayes, 2 nays.
Recall of Elected Officials
Kathy Lueckert reported that she had researched the Charter Commission
minutes, and had found the discussion about recall of elected officials. Because of the
32
decision in a court case (Jacobsen v. Nagel), recall of elected officials is available only in
case of malfeasance or misfeasance in office.
It was moved and seconded stated that unless another opinion could be found, the
Charter Commission would not further discuss the issue of recall of elected officials.
The motion passed.
Campaign Reporting
Kathy Lueckert presented the proposed charter amendment language which would
require campaign finance reporting for groups as well as individuals.
Virgil Schneider asked about the $1000 limit, and was this state law. He said
there is a $300 limit for individuals, and asked that the City Attorney verify the limits.
Jon Speck said he thinks this is a good idea, but should go to the voters along with
other proposed charter amendments.
It was moved and seconded to table this issue until the next meeting. Motion passed.
Joy Tierney asked that Roger Knutson offer suggestions on how language in the charter
might be changed to deal with temporary vacancies.
Kathy Lueckert stated that the Charter Commission still had a vacancy, and that no
applications had been received. She suggested that the Commission wait until the fall to
readvertise the vacancy.
Ty Bujold asked that the minutes express appreciation to Kathy Lueckert for the excellent
information provided prior to meetings.
Ty Bujold also expressed his thanks and appreciation to Councilmember Christian Preus
for attending the meeting.
Virgil Schneider set the next meeting of the Charter Commission for Tuesday, July 30,
1996 at 7 PM in the Public Safety Training Room. The topic of discussion will be the
supermajority vote requirement. Kathy Lueckert was directed to invite City Attorney
Roger Knutson to that meeting.
The meeting adjourned at 9:05 PM.
Kathy Lueckert, Assistant City Manager
33
PCITY F
PUMOUTI
Jul)
Laurie Ahrens
City Clerk
City of Plymouth
3400 Plymouth Boulevard
Plymouth, Minnesota 55447
Dear Ms. Ahrens,
The Plymouth Charter Commission voted at its meeting last evening to review for
an additional ninety days the issue of a possible charter amendment on requiring a
supermajority vote for a tax rate increase. This letter serves as the filing document
required by Minnesota Statutes 410.12, Subdivision 5. The ninety days will expire on
October 15, 1996. The Commission's resolution is attached.
Sincerely,
VC i 1 kn ic
Virgil Schneider, Chairman
Plymouth Charter Commission
cc: Plymouth City Council
Plymouth Charter Commission
31
PLYMOUTH :1 Pc,ruri idP1accToLive3:,0.) "'L TAOUTH BOULEVARD - PLYMOUTH. MINNESOTA 55447-1.482 - TELEPHONE (612) 509-5000
Plymouth Charter Commission
July 9, 1996
f - Z.
CjM
q11;V 4-7
BE IT RESOLVED by the Charter Commission of the City of Plymouth,
Minnesota, that in accordance with Minnesota Statutes 410.12, Subdivision 5, the
Plymouth Charter Commission determines that a ninety day extension is necessary to fully
consider all aspects of the proposed amendment on a supermajority vote requirement for a
tax rate increase, and that a resolution be filed to that effect with the City Clerk.
MOTION: Bujold
SECOND: Pauba
VOTE: 8 ayes, 2 nayes
3.f
Regular Council Meeting
July 10, 1996
Page 10
Councilmember Lymangood stated that he was not the Councilmember ho
added this item to the agenda. Councilmember Granath had asan
update. Councilmember Lymangood was attempting to get theyion to
Councilmember Granath for his questions or comment.
Mayor Tierney stated that Councilmember Wold had an ovortunity to speak.
Councilmember Wold had viewed the videotape and ted that
Councilmember Granath had no opportunity to get he floor because a member
cannot interrupt the speaker to attain the floor u er Roberts Rules. Until
Councilmember Lymangood's point of order, ere was no opportunity for
Councilmember Granath to get the floor be use of the comments of the
Chairperson.
Mayor Tierney stated that Councilm ber Granath asked Manager Johnson for
an update on the issue.
Motion was made by Counci ember Preus, seconded by Councilmember
Black, to close debate and all the question on the amendment and main
question.
Mayor Tierney qu9gfloned whether the motion was appropriate.
Councilmembff Wold raised a point of information that the motion is proper
under Robqfs Rules of Order..
Motio/to call the question carried, six ayes.
ion to amend the main motion carried, six ayes.
Main motion as amended carried, six ayes.
Item 9-A Report on Action of Charter Commission
Councilmember Preus reported on the July 9 Charter Commission meeting
which he had attended. The Charter Commission adopted a resolution to take
an additional 90 days to consider the proposed charter amendment which was
proposed by the City Council relating to requiring a supermajority vote for an
increase in the tax rate. In his view, there was little new information discussed
by the Charter Commission that the Council had not already considered. He
explained that the Charter Commission's reason for taking an additional 90
days is to get information and study the issue further.' He is unsure whether
this means that the Charter Commission will take the full 90 days or only a
portion thereof. If the full 90 days is taken, the issue cannot get on the ballot
this November.
34.
Regular Council Meeting
July 10, 1996
Page 11
Mayor Tierney stated that there is some complexity in what occurs if the
Council and Charter Commission disagree on the proposed Charter language.
The City Attorney is planning to attend the next Charter Commission meeting
to discuss the process. She invited anyone interested to attend the Charter
Commission meeting.
Councilmember Preus explained that the procedure used by the City Council is
specified by statute whereby the Council adopts the proposed language, and
the language is sent to the Charter Commission for review. The Charter
Commission has the options of agreeing or not agreeing with the language, or
adopting alternate language. This comes back to the City Council, and the
City Council decides which language goes on the ballot and to the voters.
There is not conflicting language going to the voters.
Attorney Knutson stated that the process was correctly described. He added
that under another section of the statutes, the Charter Commission can propose
their own Charter amendment independent of what the City Council does.
Councilmember Anderson asked if the City Attorney could ensure that the City
Council get the issue in time to place it on the November ballot. He is
concerned about the Charter Commission keeping the issue from the voters
this fall.
Attorney Knutson stated that he has no control over the time schedule, but will
relay the Council's desire to the Charter Commission.
Councilmember Wold thanked Councilmember Preus for representing the
Council's position at this meeting.
Mayor Tierney stated there was not an official vote to have Councilmember
Preus represent the City Council at the Charter Commission meeting. She said
that Councilmember Preus represented only himself at the -meeting.
Councilmember Preus raised a point of order that the speaker should not be
interrupted.
Councilmember Wold stated that his opinions had been represented byCouncilmemberPreusattheCharterCommissionmeeting. Councilmembers
Black and Anderson also thanked Councilmember Preus for attending the
meeting and representing their views on the topic.
33
Regular Council Meeting
July 10, 1996
Page 12
Mayor Tierney stated that this item was discussed at a council meeting, but no
action was taken by the Council to designate anyone as a designee of the
Council.
Councilmember Preus stated that prior to being elected, he had spoken with
Councilmember Wold about the supermajority vote issue, and he recently
discussed the issue rrith Councilmember Black. He noted this information in
order to avoid any appearance of serial discussions between Councilmembers
about the issue.
Councilmember Lymangood stated that Page 13 of the June 26 minutes
indicate that Councilmember Black suggested that Councilmember Preus
represent the City Council at the Charter Commission and there were no
objections from the Council.
Mayor Tierney stated there was no official vote of the Council. She stated that
it is inappropriate for the City Council to feel that the Charter Commission is
working against the Council. She believes that the City Council should be
respectful of the Charter Commission. She stated that the City Council now
has seven members, rather than five, at the initiative of the Charter
Commission.
Motion was made by Councilmember Wold, seconded by Councilmember
Anderson, to close discussion on Item 9-A and move to Item 9-B.
Mayor Tierney did not recognize the motion.
Item 9-B Council Subcommittee Meeting with Medicine Lake Council
Councilmember Preus noted that the City Council Subco7ni tte n South
Shore Drive safety issues is scheduled to meet tomorrow with the
Medicine Lake City Council. He asked if that subco meeting has been
noticed as an official meeting.
Manager Johnson stated that staff postedice of the meeting as soon as it
was learned that four members of the ' y Council may be present at the
meeting. However, sufficient adv a notice was not made to meet the open
meeting law notice requireme for an official meeting.
City Attorney Knutso ecommended that official notice is advisable when a
subcommittee of Council meets and four members are present, but he
stated that th 'ssue is debatable.
nember Wold stated that he intended to make a motion relating to
attendance at the subcommittee meeting.
31
Plymouth Charter Commission
July 30, 1996
Minutes
Present: Virgil Schneider, Dave Crain, Pauline Milner, Kapila Bobra, Ty Bujold,
Joy Tierney, Sandy Patterson, Jon Speck, Dave Pauba, Ellie Singer, Bill
Pribble, Bob Sipkins, Tim Peterson, City Attorney Roger Knutson,
Assistant City Manager Kathy Lueckert
Excused: John Duntley
Call to Order
Virgil Schneider called the meeting to order at 6:30 PM.
Approval of Minutes
The minutes of the July 9, 1996 meeting were approved as presented.
Discussion with City Attorney
Virgil Schneider introduced City Attorney Roger Knutson. Roger Knutson said
that the issue of the supermajority vote requirement for a tax increase is really a
constitutional question, not a legal one. He cannot say whether it is a good idea or a bad
idea. Roger Knutson stated that Councilmember David Anderson had requested that he
communicate to the Charter Commission Mr. Anderson's desire that the Charter
Commission finish its work in time to place the issue on the November 1996 ballot.
On the issue of campaign reporting, Roger Knutson stated that the dollar amount
limit in the proposed amendment is a number he developed, and there is no magic to it.
Virgil Schneider asked if there are any limits on contributions by individuals for
referendum questions; Roger Knutson said that there are no limits at the local level.
Kathy Lueckert asked Roger Knutson to explain the process for getting the issue
on the ballot. Roger Knutson stated that the City Council cannot put the issue on the
ballot without a Charter Commission decision on the proposed language. In response to
Virgil Schneider's question about what would happen if the Charter Commission
proposed its own language, Roger Knutson said that the City Council would consider the
language of both proposals, and then choose the proposal it wished to place on the ballot.
Ty Bujold stated that it would be possible to have two questions on the
supermajority issue on the ballot, one proposed by the City Council and one proposed by
the Charter Commission. Jon Speck asked what might happen if both questions were
approved by the voters. Roger Knutson said there is no guidance in state law as to what
happens if both questions are approved. Kapila Bobra stated that such an occurrence
would look silly to voters. Dave Crain stated that he is still most concerned about the
potential for stalemate over budget adoption.
Joy Tierney asked what the deadline is for ballot language. Kathy Lueckert stated
that the practical deadline is the week of the primary election. Dave Crain stated that the
legal guideline for ballots is 45 days prior to the election. Joy Tierney stated that there
31
does not seem to be much interest on the Council to hold a special election just for this
issue.
Jon Speck asked if there have been any court cases challenging supermajority
votes. He noted that Fridley has such a requirement for budget adoption. He wondered
why the supermajority requirement deals only with an increase, and not a decrease.
Roger Knutson stated there is no Minnesota case law on supermajority votes.
Ty Bujold asked to return to the issue of campaign reporting for special issue
elections. He noted that the proposed language limits individual contributions to $1,000.
However, there is no limit placed on the amount which might be spent on petition drives,
prior to the issue being placed on the ballot. Ty Bujold said that such expenditures
concern him, and he feels there should be accountability for petition drives as well.
Virgil Schneider asked the Roger Knutson draft some language to cover Ty Bujold's
concern.
Virgil Schneider asked if Roger Knutson has any experience in non -budget related
supermajority votes which have caused problems. Roger Knutson mentioned the issue in
Eagan over a proposed development for low income housing. The proposal could not get
the required supermajority vote. The Eagan City Council was sued; the case was settled
out of court and the project is now under construction.
Dave Crain stated that perhaps the language might be changed to require a vote of
two thirds of those present.
Roger Knutson left the meeting at 7:05 p.m.
Campaign Reporting
Virgil Schneider asked if the Commission wanted to have further discussion on
the campaign reporting issue. Dave Crain stated that he is concerned about limiting the
amount that an individual can contribute to a special issue campaign. However, he feels
strongly that campaign reporting is important. Tim Peterson stated that while he is not
concerned about the amount contributed, he is concerned that it be reported. Joy Tierney
stated that the $1,000 limit will impact very few individuals, but that some special issue
elections could have direct benefits to some residents. Tim Peterson stated that he is also
concerned about in-kind contributions, and suggested that some language be added to
deal with that issue.
Virgil Schneider stated that he thinks it is a good idea to require campaign
reporting on special issue elections. He also wants language to require reporting prior to
the election, at intervals similar to those required for individual candidates. Ellie Singer
asked if the Commission wanted to place this question on the ballot. Virgil Schneider
stated that it is not important enough to place it on the ballot by itself, but that it could be
placed with other questions.
Virgil Schneider directed Kathy Lueckert to ask Roger Knutson to redraft the
language proposed for campaign reporting to address the following issues: remove the
dollar limit for contributions, include guidelines for reporting for petition drives,
incorporate language that would cover "in kind" contributions, and require reporting at
intervals prior to and after the election.
Na
Supermajority Vote
Ty Bujold said that he had done some research on the issue of supermajority
votes, but that there is limited literature. He distributed copies of articles he had found on
the topic. He stated that this is an important philosophical issue to be debated. He feels
that he must educate himself first so that he can help inform voters. He stated that this
issue requires careful thought. Kapila Bobra agreed that it is crucial for Commission
members to educate themselves.
Ty Bujold suggested that the Commission have expert speakers, both pro and con,
come to the next meeting. Commission members agreed that this was a good idea.
Various commission members will seek out speakers on both sides of the issue. Kathy
Lueckert will contact the League of Minnesota Cities and the Minnesota Taxpayer's
Association.
Ellie Singer stated that she does not want to create a divisive atmosphere. She
said that she has not yet formed an opinion. She takes her role as a charter commission
member very seriously. She wants more information before she decides on the
supermajority question.
Joy Tierney stated that the Commission should avoid "dueling amendments."
Sandy Patterson agreed that this would not be good for the city.
Bob Sipkins stated that he feels it is important to educate the Charter Commission
so that the commission can give good information to voters. He stated that he is keeping
an open mind, and could be persuaded either way with the presentation of compelling
information. He wants to hear all sides of the issue.
Tim Peterson stated his desire to try to work within the time parameters to get the
issue resolved. He does not want to postpone the issue unnecessarily.
The Charter Commission will hold a meeting on August 20 to hear speakers on
either side of the supermajority issue. The meeting will be at 7 PM in the Public Safety
Training Room.
The Charter Commission will hold a public meeting on the proposed
supermajority vote issue on September 9, 1996 at 7 PM in the Council Chambers. The
meeting will be televised. The Charter Commission will meet immediately following the
public hearing, and will try to forward its decision to the City Council at the Council's
September 18 meeting.
Adjournment
The meeting adjourned at 8:17 PM.
NI
Plymouth Charter Commission
August 20, 1996
Minutes
Present: Virgil Schneider, Bill Pribble, Jon Speck, Joy Tierney, Bob Sipkins, Tim
Peterson, Ellie Singer, Ty Bujold, Pauline Milner, Dave Pauba, Sandy
Patterson, Kapila Bobra, Assistant City Manager Kathy Lueckert
Guests: Lynn Reed (Minnesota Taxpayer's Association), Kent Sulem (League of
Minnesota Cities), Jim Willis (Inver Grove Heights City Manager)
Excused: John Duntley
Absent: Dave Crain
Call to Order
Virgil Schneider called the meeting to order at 7:05 PM.
Approval of Minutes
The minutes of the July 30, 1996 meeting were approved as presented.
Discussion of Supermajorily Vote Requirement
Virgil Schneider noted that this evening's meeting included speakers from the
League of Minnesota Cities, the Minnesota Taxpayer's Association, and the Inver Grove
Heights City Manager. He introduced Kent Sulem, an attorney with the League of
Minnesota Cities (LMC).
Kent Sulem, League of Minnesota Cities. Mr. Sulem stated that the city requested that he
and the League examine the issue of supermajority vote requirements for a tax increase.
He said the Plymouth would be the first charter city to have such a restrictive amendment.
Eight other charter cities have a supermajority vote requirement to make budget
adjustments, once the budget has been adopted. Duluth has an informal policy to not
increase the tax rate because of increases in the tax base.
Mr. Sulem noted that in 1994 four states proposed amendments for supermajority
requirements for tax increases at the state level. Three of the four were defeated. The
experience shows that voters are not as supportive of the idea once they are given
information and understand all the implications.
Mr. Sulem stated that a supermajority requirement could tie the hands of cities.
State and federal funding is uncertain, and there is a strong possibility that local aid to
cities will be reduced or eliminated in Minnesota during upcoming legislative sessions.
A supermajority requirement might restrict the city's ability to respond thoughtfully and
promptly to revenue shortfalls. Mr. Sulem noted that while Plymouth is still growing, the
IN
expansion of tax capacity may not be enough to offset the need to reduce services to meet
a shortfall.
Mr. Sulem stated that the League's view on this issue is not to restrict the city's
flexibility to deal with fiscal uncertainties, and that the League would not recommend this
amendment.
Jon Speck asked if Plymouth were not a charter city, would the supermajority
vote even be an option, i.e. if Plymouth were a statutory city, would the supermajority
vote requirement be possible?
Mr. Sulem stated that the only means of establishing such a requirement for a
statutory city would be by ordinance, which could be changed at any time. Mr. Sulem
stated that it is his understanding that Plymouth's charter does not permit the City
Council to pass such an ordinance, which is why the amendment is suggested for voter
approval in the first place.
Ty Bujold stated that many levels of government are considering measures to
make it more difficult to raise taxes. He sees a trickle down effect in the future, and local
governments might be saddled with services for which there is no money to fund. He
asked Mr. Sulem what services might be impacted in such a situation.
Mr. Sulem said that decisions on services are made on a city by city basis, and
that staffing levels must be considered.
Tim Peterson stated that it is important to preserve flexibility to deal with
different fiscal scenarios, and that certain fiscal events might trigger different tax rate
approval requirements. Kathy Lueckert stated that this was one of the options for a
charter ordinance given to the City Council for consideration.
Mr. Sulem stated that it would be possible to determine tax rate approval
guidelines based on different fiscal conditions, and that the Commission should consider
this. He noted that Plymouth has done an exceptional job of keeping the tax rate low
over the years.
Ty Bujold stated that he was unclear why the City Council needed extra
guidelines for taxation issues. It is his view that the involvement and voice of the
constituency should be enough of a controlling factor without a supermajority vote
requirement.
Mr. Sulem noted that the proposed amendment sounds good to voters, and that it
sells well." If a city council is doing its job well, the electorate should trust the council
to make the right decisions without a supermajority vote requirement.
Jon Speck said that some of the information retrieved from the Internet indicated
that the Minnesota legislature was considering two/thirds vote requirements on certain
taxation issues. He asked if Mr. Sulem knew the status.
Mr. Sulem stated that that particular bill did not see any action in 1996, but he did
not know what might be introduced in 1997.
Lynn Reed, Minnesota Taxpayer's Association. Virgil Schneider introduced Lynn Reed,
Research Director for the Minnesota Taxpayer's Association (MTA). Mr. Reed said the
MTA has existed since 1926, and focuses on education and advocacy. Mr. Reed
distributed an article on Tax and Expenditure Limits on Local Governments from the
Advisory Commission on Intergovernmental Relations (ACIR), and the MTA newsletter.
N3
Mr. Reed said he would discuss three issues: why are tax and expenditure
limitations (TELs) popular, what are the merits of Plymouth's proposed amendment, and
are there better ways to accomplish the same goal?
In addressing the "why" question, Mr. Reed said that interest in controlling taxes
is not a new phenomenon. As early as the nineteenth century Americans were concerned
with perceived high taxes, and the 1970's tax revolt also is indicative of this sentiment.
The concern about taxation reflects a lack of confidence in elected officials. Voters do
not feel that they are getting their money's worth, and that elected officials are not paying
attention. Mr. Reed stated that there is a perception that there are insiders and special
interest groups who have access to government officials, but ordinary citizens do not. He
asked how well attended council meetings are by ordinary citizens. He said the lack of
confidence is worse in Minnesota because of the complex property tax system. The
current system makes it difficult to fix responsibility for spending, and most citizens do
not understand it.
In terms of the Plymouth proposal, Mr. Reed asked what the goal is of this
proposal. Is it to make increasing taxes more difficult? He noted that the tax base has a
tremendous impact, in that actual taxes paid can go up because of value increases, while
the tax rate itself is decreasing. If the goal is to make it more difficult to spend taxpayer
dollars, the current proposal might not meet that goal because Plymouth's growing tax
base.
Mr. Reed said that there might be a better way to limit property taxes. He
suggested changing the current property tax classification system within the city to even
out the burden between homeowners and businesses. While he doesn't know if changing
the classification system is possible, it is an intriguing idea. Mr. Reed also suggested a
focus on the absolute dollars generated, rather than on the tax rate, and place a
supermajority limit on the dollars. Mr. Reed said the bottom line is that voters are
frustrated, and that they want access to government and accountability in government.
Mr. Sulem noted that voters are indeed frustrated with all levels of government,
but he is uncertain whether or not an action at the local level will do much to alleviate it.
He said that it is important to educate voters on the details of city spending. He doubts
that there is little that can be done about the tax classification system structure at this
point.
Joy Tierney asked if the city shouldn't preserve its flexibility to deal with
changing fiscal conditions, such as a loss of homestead aid or a drastic change in the tax
system.
Mr. Reed said that flexibility can be preserved in how the guidelines are written.
The bottom line is accountability: who controls the taxes and who spends the tax dollars.
Ty Bujold asked why make taxes the only supermajority limit? He said that
people might feel strongly that granting a liquor license is important enough to warrant a
supermajority requirement. He wonders if the supermajority requirement is a "slippery
slope," and if the present proposal is just an attempt to make people feel good.
Mr. Reed said that taxes are important to everyone. However, he stated that the
balance of access seems to have tilted away from citizens, and that the average citizen
needs extra leverage to be heard in government. Mr. Reed said that the supermajority
vote requirement might not be the best option, but that a referendum might be a better
11
choice. He noted that elected officials at all levels must evaluate the levelness of the
playing field, and must have personal morality beyond the next election.
Kapila Bobra asked if the MTA would lobby for changes in Minnesota's fiscal
system.
Mr. Reed stated that it is important to even out revenue sources, and that there are
advantages and disadvantages to each type of tax. He stated that MTA has not taken a
position on supermajority requirements.
Jon Speck asked Mr. Reed about his letter's reference to the state of Arizona's
supermajority requirement. Mr. Reed had mentioned that this requirement had produced
unintended consequences.
Mr. Reed responded that in Arizona acquiring the extra votes needed for a
supermajority to pass the state's budget had proven very expensive. The overall spending
increased by nearly 50% in order to achieve the supermajority requirement.
Mr. Bujold asked why MTA had not taken a position on the supermajority vote
requirement.
Mr. Reed stated that MTA was still analyzing the issue, that cities should be free
to do what cities do best, and that sources of funding should not be commingled.
Jim Willis, Inver Grove Heights City Manager. Mr. Willis stated that supermajority
requirements are not the way governments should work. He said that local officials are
elected and appointed to manage the affairs of the city, and must generate the revenues
needed to pay the city's bills. He said that in general, cities see very little "games
playing." Most elected officials are concerned with the tax rate, not the tax dollars
generated by that rate. Mr. Willis recalled that during his tenure as city manager of
Plymouth, nearly all the budgets and tax rates were adopted unanimously. He noted that
supermajority requirements mean that some individual votes become more important than
other individual votes. Mr. Willis said that Plymouth is very well off in comparison to
other communities, but that this relative prosperity will not last forever. He stated that he
does not see the need for a supermajority vote, and does not feel it is good public process
or policy. It is difficult to predict what the consequences of such a requirement might be
for future city councils.
Ty Bujold asked if Mr. Willis thought that voters would embrace the idea.
Mr. Willis said that most citizens do not take the time to educate themselves about
the real problems, and that amendments such as these do not make the problems
disappear.
Mr. Sulem mentioned a metro -area city in which voters had approved a charter
amendment which placed severe restrictions on the use of special assessments for street
reconstruction. This city is now a "loss leader" for the League's insurance trust because
of all the problems with streets. The city has been unsuccessful in repealing the
amendment.
Discussion of Campaign Reporting Amendment.
Virgil Schneider called the Commission's attention to the language drafted for a
possible campaign reporting amendment. The Commission agreed that the language was
acceptable, but took no formal action on the proposal.
50
Discussion of September 9, 1996 Public Hearing.
The Charter Commission discussed the general format of the September 9 public
hearing on the supermajority vote requirement. Kathy Lueckert will make a brief
statement of how the amendment was brought to the Charter Commission. Virgil
Schneider will then discuss the Commission's actions and deliberations since May 1996.
The Commission will then hear comments from the public on the proposal. Virgil
Schneider said that the Charter Commission will meet following the public hearing to
consider what, if any action will be taken by the Commission.
Virgil Schneider asked that Kathy Lueckert sent thank you notes to this evening's
speakers, and invite them to participate in the public hearing on September 9. Several
Commission members asked that the minutes reflect the appreciation of the Charter
Commission for the presentations made by the three speakers.
The meeting adjourned at 9 PM.
HG
Regular Council Meeting
August 21, 1996
Page 11
Item 9-A Charter Commission Minutes of July 30
Councilmember Lymangood read an excerpt of the Plymouth Charter
Commission minutes of July 30: "Joy Tierney asked what the deadline is for
ballot language. Kathy Lueckert stated that the practical deadline is the week
of the primary election. Dave Crain stated that the legal guideline for ballots
is 45 days prior to the election. Joy Tierney stated that there does not seem to
be much interest on the Council to hold a special election just for this issue. "
Councilmember Lymangood stated that he does not recall the City Council
discussing whether this issue was of sufficient importance to schedule for
consideration at a special election.
Mayor Tierney stated that no official position was taken by the City Council,
but she had made this assumption from Councilmember Lymangood's previous
comment that if the question does not get on the November ballot, it would
take two more years to.be considered. She stated that this was brief, general
discussion and that she did not relay an official position of the City Council to
the Charter Commission.
Motion was made by Councilmember Lymangood, seconded by
Councilmember Granath, to direct staff to prepare a report for consideration at
the next budget study meeting on funds necessary to allow for one special
election in the 1997 proposed budget. Motion carried, seven ayes.
Councilmember Lymangood stated that the Charter Commission has scheduled
a public hearing on September 9 to address the issue of a supermajority vote
requirement for a tax levy increase.
Assistant Manager Lueckert announced that the meeting will begin at 7 p.m.
on September 9, and citizens are invited to attend. The meeting will be
cablecast.
Councilmember Anderson asked if the Charter Commission intends to vote on
the recommendation to the City Council following the public hearing that
evening.
Assistant Manager Lueckert stated that she believes the intent of the Charter
Commission is to make a decision on their recommendation following the
public meeting that evening, if possible. The City Council could schedule a
special meeting on September 10 or 11. In the event that the Charter
Commission makes a recommendation; the City Council could act on the issue.
The ballot language must be submitted to the County for ballot printing on
September 11.
N 3
Regular Council Meeting
August 21, 1996
Page 12 ,
touncilmember Anderson supported scheduling a special council meeting to
consider the recommendation of the Charter Commission.
Manager Johnson stated that the City Council could schedule a special meeting
on September 10, but the meeting could not begin until 8 p.m. due to the State
Primary Election.
Motion was made by Councilmember Wold, seconded by Councilmember
Lymangood, to establish a Special Council Meeting for September 10 at 8 p.m.
to receive the recommendation of the Plymouth Charter Commission on the
issue of a supermajority vote requirement for a tax levy increase, and to
consider the proposed charter amendment language.
Mayor Tierney stated that the Charter Commission is holding a public hearing
on September 9, but they may not necessarily adopt a report to submit to the
Council following the public hearing.
Assistant Manager Lueckert clarified that it is her understanding that the
Charter Commission intends to adopt a recommendation to the Council
following the public hearing on September 9; however, the Charter
Commission legally has until October 15 to adopt a recommendation.
Mayor Tierney reported that speakers from the Minnesota Taxpayers
Association and the League of Minnesota Cities, as well as the former City
Manager attended the last Charter Commission meeting to speak on the
supermajority vote issue. There was not significant support for the proposal.
A point of order was made by Councilmember Preus. He stated that the
discussion does not relate to the motion under consideration which is whether
to schedule a special meeting.
Councilmember Wold stated that he is ay. -are that the Charter Commission has
the legal right not to act on September 9 following the public hearing.
However, the City Council must schedule a Special Meeting in the event that a
recommendation is received.
Councilmember Black expressed disappointment that she will be unable to
attend the Special Meeting.
Motion carried, seven ayes.
Councilmember Lymangood asked if the Charter Commission meeting on
September 9 is a public hearing or public meeting.
Regular Council Meeting
August 21, 1996
Page 13
Manager Johnson explained that the entire meeting is open for the public to
attend. As part of the meeting, a public hearing will be conducted on the
supermajority vote issue. The Charter Commission could consider their
recommendation following the public hearing portion of the agenda.
Councilmember Anderson asked if the City Council can formally request that
the recommendation on the proposed supermajority Charter amendment be
voted on by the Charter Commission on September 9 following the public
hearing.
City Attorney Knutson stated that the City Council can go on record as
requesting that the Charter Commission make their recommendation on
September 9, but can't require any action to be taken.
Motion was made by Councilmember Anderson, seconded by Councilmember
Granath, to respectfully request that the Charter Commission make a
recommendation on the proposed supermajority Charter amendment on
September 9.
Councilmember Granath stated that the City Council respects the independence
and commitment of the Charter Commission. He believes that they should
consider the item and make a recommendation while the public is present on
September 9.
Councilmember Wold spoke against the motion as he does not believe it is
appropriate for the City Council to make official requests of the Charter
Commission. He believes that the Council can trust the Charter Commission
to deliver a recommendation and does not want to be party to an appearance of
the Council pushing the Charter Commission for a recommendation. He
expects that the Charter Commission will make a recommendation on
September 9.
Councilmember Granath stated that the independence of the Charter
Commission is necessary to the governing of the City. He wants to encourage
the Commission to make a recommendation to the Council, irrespective of the
decision.
Councilmember Preus stated that he will support the motion. The Charter
Commission knows that it is an independent body, and he fully respects their
independence. However, he will support the motion as a reminder to the
Charter Commission that this is what the City Council would like in order to
get the supermajority amendment on the ballot in November. If the Charter
Commission does not adopt a recommendation on September 9, the issue
cannot be placed on the November ballot.
N9
Regular Council Meeting
August 21, 1996
Page 14
Mayor Tierney stated that one question has arisen on whether the Charter
Commission could have moved up the public hearing. She said that when the
City Council indicated it did not wish to meet with the Charter Commission on
the supermajority amendment issue, it slowed the schedule. The Charter
Commission wanted full notice of the public hearing, and this was done
through the newspapers and September Plymouth News. She forewarned the
Council that the Charter Commission previously considered the supermajority
vote issue and that most information they received is against such a Charter
amendment. The Charter Commission has some valid concerns in putting this
language into a charter amendment, and the Charter Commission deserves
respect.
Councilmember Preus stated there is no question that members of the City
Council respect the Charter Commission. He said that the Charter
Commission's scheduling of the public hearing on September 9 has nothing to
do with the decision of the City Council not to meet as a whole with the
Charter Commission. That decision was made in June or July. The Charter
Commission waited to schedule the public hearing because they wanted to get
additional information on the proposal. He said that the Charter Commission
disagreed with the Council's decision not to meet with the Commission, but
they respected that decision.
Mayor Tierney stated that Councilmember Preus may be correct, but it did
seem like a delay to the Charter Commission.
Motion carried: Anderson, Lymangood, Preus, Granath, and Black ayes;
Wold nay; Tierney abstained.
Mayor Tierney said that she abstained because of the dual role that she is
playing at this point.
Item 9-B AMM Meeting on Transportation
Mayor Tierney.reported that one of the main areas of interest to t
Association of Metropolitan Municipalities is trZrouportatio ey are
currently discussing ways of reducing speeding neighborhoods,
including consideration of 25 mph speed limit a asked if the Council
supports this effort.
Councilmember Wold sta at he supports such an effort. He suggested
that the issue of 25 speed limits be forwarded to the Community PolicingSubcommittarodewithapoliceofficeronNationalNightOutandstated
that t are other ideas to discuss as well.
SO
slj-c P10j
ql]AoIq
PLYMOUTH:
4 dU <EOUL vAI D .:PLY3:::04:PYN.....:....................:........,.:....... _ :......
DATE: September 6, 1996
TO: Mayor and City Council
FROM: - Kathy Lueckert, Assistant City Manager
SUBJECT: Available Options for Possible Charter Commission Report
On September 9, 1996 the Charter Commission will hold a public hearing to receive public
comment on the proposed charter amendment to require a supermajority vote to increase
the tax rate. The Charter Commission may be prepared to make its report to the City
Council on September 10. However, legally the Charter Commission has until October 15
to make its final report on the proposed amendment to the City Council.
Four scenarios are possible for the September 10 meeting.
1. No report from Charter Commission. If the Charter Commission does'not make a
report to you on September 10, the Council cannot take action to place the proposed
amendment on the November ballot. After receiving the report or after October 15, the
Council could consider scheduling a special election for this issue during 1997.
2. Charter Commission report rejects proposed amendment. If the Charter
Commission does make a report to the Council on September 10, it could reject the
language proposed by the Council. After receiving the report, the City Council can take
action to place its original proposed amendment language on the ballot in November or at
the next regularly scheduled city election, in November 1998.
3. Charter Commission report recommends alternative language. If the
Charter Commission makes a report on September 10, it may recommend alternative
language for the proposed amendment. The City Council can choose between the original
language and the alternative language in determining the amendment to place before
voters in November.
4. Charter Commission report recommends alternative language; City Council and
Charter Commission seek language compromise. If the Charter Commission makes its
31
11
ort
report and suggests alternative language, the City Council could choose to wok with theCharterCommissiontoreachagreementonlanguageacceptabletobothbodies. This
would then place the issue before the voters in a special election in 1997 or at the nextregularlyscheduledcityelection, in November 1998.
Attached is a copy of the proposed language, as well as the relevant section fromMinnesotaStatutes.
g4o pe . N
CITY OF PLYMOUTH of//
HENNEPIN COUNTY, MINNESOTA
RESOLUTION NO. 96-9
AN ORDINANCE AMENDING THE PLYMOUTH
CITY CHARTER CONCERNING TAXATION
l:
WHEREAS, Minn. Sta. §410.12, Subd. 5 authorizes the City Council to propose
charter amendments to the voters by ordinance.
THE CITY OF PLYMOUTH ORDAINS:
SECTION 1. Chapter 7 of the City Charter is amended by adding Section 7.15
to read:
7.15 Increase in Tax Rate.
A two-thirds majority of all members of the Council is required to adopt a tax
levy resolution that increases the City's tax rate over the prior year. Tax rate means
the quotient derived by dividing the City's tax levy by the City's net tax capacity.
SECTION 2. Effective Date. This ordinance shall become effective only
when approved by the voters as provided in Minn. Stat. §410.12, Subd. 4.
ADOPTED by the City Council this 15th Day of May, 1996.
ATTEST:
Laurie F. Ahrens, City Clerk
4ceP T' rne, Mayor
s3
4162
463
CLASSIFICAMN; CHARTERS 410.12
In this section.Uponcer- the city lrtiferk sthatexaminationontothecouncil. [f theycity clerk shall
ccetition,
dmenIs to
resluhall
lt of thetifythey
vePercent :2 petition is insufficient the city clerk shall set forth in a certificate the particulars in
If the city ;;. ', it is defective and shall at once no the committee of the petitioners of the find- which
eligible to ,. ings. A petition may be amended at any time within ten days after the making of a cer-
nt shall be tificate of insufficiency by the city clerk, by filing a supplementary petition upon
d amend_ additional pape 8nsigned and filed as provided in case of an original petition. The city
mora than clerk shall within five days after such amendment is filed, make examination of the
clerk, ,and amended petition, and if the certificate shall show the petition still to be insufficient,
300 words t.:: the city clerk shall file it in the city clerks office and notify the committee of the peti- I
na 'shall x tioners of the findings and no further action shall be had on such insufficient petition. I
d and an`' r `• The finding of the insufficiency ora petition shall not prejudice the filing of a new peti-
11 be suf" tion for the same purpose.
is sought Subd. 4. Election. Amendments shall be submitted to the qualified voters at a gen- fthc
1
pro- cral or special election and published as in the case of the original charter. The formar:y Iapprovalbmissionoftheballotshallbefixedbythegoverningbody. The statement of the question on thet .
ations in
t` ballot shall be sufficient to identify the amendment clearly and to distinguish the ques-
ply
tion from every other question on the ballot at the same time. If 51 percent of the votes e
cast on any amendment are in favor of its adoption, copies of the amendment and cer-
tificates; shall be filed, as in the case of the original charter and the amendment shall
rmay be _ w: take effect in 30 days from the date of the election or at such other time as is fixed in
wided in the amendment.
Subd. 5. Amendments proposed by council. The council of any city having a homez
1
to one rule charter may propose charter amendments to the voters by ordinance. Any ordi- irculator . nance proposing such an amendment shall be submit to the charter commission. j kignatureWithin60daysthereafter, the charter commission shall
csidence .L ment ut be ore a expiration o sur pen t c commission ma extend the time f r
ere shalli rcvie nalays ing with city cthecierk its resolution determining
on each K that an additional time for review is needed. A ter reviewing the proposed amendment, I
e of the !i` a charter commissions approve or reject t e Dropos: amen mcn or suggest a
xtiiion.r III
subsutute amen3—m eiTEcommissionshallpromptlynotifythecouncilotheaction'
en. On notification of the charter commissions action, the council may submit tot the people, in the same manner as provided in subdivision 4, the amendment originally
by itproposed or the substitute amendment proposed by the charter commission. The
amendment shall become effective only when approved by the voters as provided in
the a&subdivision 4. If so approved it shall be filed in the same manner as other amendments.
Nothing in this subdivision precludes the charter commission from proposing charterpended
D be the amendments in the manner provided by subdivision 1.
Subd. 6. Amendments, cities of the fourth class. The council of a city of the fourth
class having a home rule charter may propose charter amendments by ordinance with-
out submission to the charter commission. Such ordinance, if enacted, shall be adopted
by at least'a four-fifths vote of all its members after a public hearing upon two weeks'
published nnf inn containing the text of the proposed amendment and shall be approved
by the mayor and published as in the case of other ordinances. The council snail submit 1
the proposed amendment to the people in the manner provided in subdivision 4, but Inotsoonerthanthreemonthsafterthepassageoftheordinance. The amendment
becomes effective only when approved by the voters as in subdivision 4. Ifctcdofprovided
cc with so approved, it shall be filed in the same manner as other amendments.
Subd. 7. Amendment by ordinance. Upon recommendation of the charter commis-
Sion the city council may enact a charter amendment by ordinance. Such an ordinance, oposed if enacted, shall be adopted by itsacini" the council by an affirmative vote of all members after
a Public hearing upon two weeks' published notice containing the text of the proposedclerk
amendment and'shall be azcrthe pprovcd by the mayor and publuhcd as in the cast of other
ordinances. An ordinance amending a city charter shall not become effective until 90Ypeti- days after passage and publication or at such later date as is fixed in the ordinance. turd Within 60 days after Ipassageandpublicationofsuchanordinance, a petition request-
Minutes
Special Council Meeting
September 10, 1996
A special meeting of the Plymouth City Council was called to order by Mayor Tierney at
8:10 p.m. in the Public Safety Training Room, 3400 Plymouth Blvd., on September 10,
1996.
COUNCIL PRESENT: Mayor Tierney; Councilmembers Anderson, Wold, Lymangood,
Preus, and Granath.
ABSENT: Councilmember Black.
STAFF PRESENT; City Manager Johnson, Assistant City Manager Lueckert, Community
Development Director Hurlburt, Public Works Director Moore, and City Clerk Ahrens.
Mayor Tierney reviewed the meeting agenda: 1) Consider a Discretionary Environmental
Assessment Worksheet for Plymouth Ponds Building Four (tabled from September 4,
1996), and 2) Consider Charter Commission recommendation on proposed Charter
Amendment regarding super -majority vote requirement for tax levy increase.
Motion was made,by Councilmember Lymangood, seconded by Councilmember Preus, to
reverse the order of the agenda items. Motion carried, six ayes.
Motion was made by Councilmember Wold to add to the agenda discussion on the first
meeting of the Computer Subcommittee.
Manager Johnson stated that under the Open Meeting Law requirements, no new items
may be discussed at this special meeting.
Councilmember Wold withdrew his motion.
Proposed Charter Amendment regarding Supermajority Vote Requirement for Tag
Levy Increase
Assistant City Manager Lueckert reported that on September 9, 1996, the Charter
Commission held a public hearing on the proposed supermajority vote requirement
for a tax rate increase. The Charter Commission voted six to five to defer action
on the proposed charter amendment until their next meeting on Monday,
September 30, at 7 p.m. The Charter Commission will make its report by the
deadline, October 15, 1996.
Motion was made by Councilmember Lymangood, seconded by Councilmember
Wold, that all staff directives be in the form of motions. Motion carried, six ayes.
6-f
Special Council Meeting
September 10, 1996
Page 2
Motion was made by Councilmember Lymangood, seconded by Councilmember
Granath, to direct the City Manager to ensure that meticulous notes are being
taken of this meeting and that the proposed supermajority vote requirement for a
tax rate increase, along with the proposed 1997 budget, be added to the next
regular council meeting.
Councilmember Lymangood explained that he wants a summary of this meeting
given by the City Manager, and an opportunity to discuss on camera the proposed
Charter amendment and issues regarding the 1997 proposed budget that were
discussed at the Charter Commission public hearing.
Councilmember Granath stated that he watched the entire public hearing and
supports the motion. Councilmember Wold also spoke in favor of the motion.
Motion was made by Councilmember Wold, seconded by Councilmember
Anderson, to amend the motion to direct staff to supply the City Council with the
minutes of the Charter Commission public hearing, and to indicate on the staff
summary memo which Commissioners voted for and against the tabling action.
Vote on the amendment, six ayes
Mayor Tierney asked Councilmember Lymangood to clarify his motion.
Councilmember Lymangood stated that he would like more detailed commentary
included in the minutes of this meeting because the proposed Charter amendment
is an important issue and this meeting is not televised.
Mayor Tierney asked why the proposed 1997 budget would be added to the
upcoming regular council agenda, rather than discussing issues later at the Truth in
Taxation hearing.
Councilmember Lymangood stated he would like to discuss the proposed 1997
budget at the next regular meeting because issues were raised at the Charter
Commission public hearing regarding the proposed 1997 budget. For example,
Councilmember Wold made a statement that when taxes are paid, they are gone
permanently and that behooves the Council to keep the tax rate as low as possible.
A Charter Commissioner said the plan for 1997 is to lower the tax rate, but the
proposed budget would allow for a minor tax increase. Councilmember
Lymangood stated he was moved to consider making additional suggestions to
staff relating to the proposed 1997 budget prior to the Truth in Taxation hearings
that will be held in December.
Main motion as once amended carried, six ayes.
sG
Special Council Meeting
September 10, 1996
Page 3
Motion was made by Councilmember Lymangood, seconded by Councilmember
Anderson, to direct staff to provide a report at the next regular council meeting
regarding specific options available to the Council, including timelines, for calling
of a special election on the proposed Charter amendment regarding a
supermajority vote requirement for a tax levy increase, in light of the tabling action
by the Charter Commission.
Councilmember Lymangood stated that he wants to ensure that by the next regular
council meeting, the Council is prepared to consider an election timeline, should
the Council choose to pursue that alternative given that the proposed Charter
amendment cannot be on the November 1996 election ballot. He stated that
perhaps the Council could still call a special election for 1996.
Manager Johnson said that is possible.
Mayor Tierney stated that a special election could be held anytime and prior to the
next City election which would be in November 1998.
Councilmember Lymangood stated that the City Council has allowed for the 1997
preliminary budget to include a special election. The Council has been informed
that there will be a significant budget surplus in 1996, so perhaps the special
election cost could be removed from the 1997 budget and levy, and funded in
1996.
Councilmember Granath supported the motion. He stated that he generally
supports the proposed supermajority amendment and he was disappointed by the
Charter Commission's tabling vote. He would like to see the issue progress at the
next regular council meeting.
Mayor Tierney stated that no one had given the Charter Commission any
indication that this was a "hurry up" item. She stated that the City Council has a
10:00 p.m. adjournment time, and they should not expect the Charter Commission
to meet past that time.
Councilmember Granath stated that he would like the voters to be able to vote on
the proposed Charter amendment.
Mayor Tierney said that the Charter Commission needs time to discuss the issue.
Motion carried, six ayes.
Councilmember Wold stated that six of seven Council members voted in favor of
the proposed Charter amendment regarding a supermajority vote requirement for a
tax levy increase. He believes that all Councilmembers were disappointed in the
30?
Special Council Meeting
September 10, 1996
Page 4
Charter Commission's tabling of the item. He stated that the Charter Commission
showed a remarkable "paralysis of analysis", and he was distraught over their
meeting. Councilmember Wold said that no one on the Charter Commission could
make a decision. The Charter Commission was empowered to make a decision at
the meeting on September 9, and they failed to do so.
Councilmember Wold also responded to Mayor Tierney's comment that the
Council had not indicated there was a hurry on the proposed Charter amendment
issue. He stated that twice the City Council passed a motion requesting that the
Charter Commission make a decision because the Council felt it was important to
let the voters decide on the issue. He said that the November General Election is
the last opportunity to reach the greatest number of voters that will be seen for
four years — into the next century. He stated that the Charter Commission was
irresponsible. The City Council was ready to act, and the Charter Commission
should have taken a position either for or against the issue.
Councilmember Wold stated that at the Charter Commission meeting, he was
accused of this being a political issue. He was appalled that the Mayor did not
defend him, and he was ashamed of the Mayor. Councilmember Wold stated he
looks forward to discussing the entire issue at the next Council meeting, and he
requested a copy of the videotape from the Charter Commission public hearing.
Mayor Tierney commented on the Charter Commission public hearing.
Councilmember Wold raised a point of order that Mayor Tierney had already made
comments regarding the public hearing, and other Council members who had not
yet spoken to the issue wished to speak.
Mayor Tierney continued with her comments.
Councilmember Wold challenged the ruling of the Chair.
Mayor Tierney recognized Councilmember Preus.
Councilmember Preus stated that the proposed Charter amendment is very clearly
not an issue of "why the rush", but of "why the delay'. He stated that the City
Council reviewed and considered three proposals relating to the proposed Charter
amendment on May 15. The Charter Commission public hearing was held on
September 9. This was the first time the Charter Commission reviewed anything
other than the single proposal recommended by the City Council. He asked why
the Charter Commission waited four months to consider anything other than the
Council's proposal. Councilmember Preus stated that some of the comments by
the Charter Commission indicated that they knew they had an opportunity to
consider the issue and some members had decided their view on the issue. He said
jot
Special Council Meeting
September 10, 1996
Page 5
it is very disappointing that it will be the next century before a very large number
of voters would have the opportunity to vote on the issue. The Charter
Commission's duty was to review the City Council's recommendation and
respond. The Commission has prevented the City Council from exercising the
option of sending the issue to the voters at the general election. He said that the
argument that the Charter Commission needs more time is impossible to
legitimately argue.
Councilmember Anderson supported the comments made by Councilmembers
Lymangood, Preus, Wold, and Granath. He made a motion at the last council
meeting to request that the Charter Commission take action on the City Council's
proposal because tonight is the deadline to put a question on the November ballot.
He said that the arrogance involved in this issue bothers him, as a limited number
of people are trying to keep the proposed Charter amendment from all of the
citizens in the City. The City Council wants the issue in front of the taxpayers, and
it needs to be openly discussed on television.
Motion was made by Councilmember Lymangood, seconded by Councilmember
Anderson, to direct staff to present at the next regular meeting three options for
ongoing showing of the Charter Commission public hearing of September 9,
including timing and frequency of playbacks and how it would interfere with other
scheduling, with one option being to run the three-hour meeting in a continuous
playback loop.
Councilmember Lymangood stated he was moved.by the meeting. It was
significant and contemporaneous. He believes that the fairest way to present the
events of the meeting is with unbiased commentary by viewing of the hearing.
Mayor Tierney questioned whether the showing of the hearing should pre-empt
other programming.
Councilmember Lymangood said that at least one option — the ongoing showing -
would definitely pre-empt other programming. This can be evaluated when the
options are presented.
Mayor Tierney asked what it will cost to have ongoing showing of the hearing.
Councilmember Wold stated that the cost involved will be part of the staff report,
as every staff recommendation comes to the Council with a cost estimate.
Motion was made by Councilmember Preus, seconded by Councilmember Wold,
to call the question. Motion carried, six ayes.
Motion carried, six ayes.
s9
Special Council Meeting
September 10, 1996
Page 6
Motion was made by Councilmember Lymangood, seconded by Councilmember
Granath, that Councilmember Lymangood's comments at the Charter Commission
meeting be included as part of these minutes.
Mayor Tierney referenced one of Councilmember Lymangood's comments at the
hearing relating to her conflict of interest. She said that no conflict of interest
exists from her service on the City Council and the Charter Commission.
Councilmember Preus raised a point of order that the motion under consideration
relates only to whether the comments should become part of these minutes. The
motion does not relate to the substance of the comments.
Motion carried, six ayes.
Mayor Tierney stated that some Charter Commissioners took offense and felt that
the City Council had figured this issue out and were telling them what to do. The
Charter Commission reviewed the information; took public testimony, and were
ready to debate five items relating to the proposed amendment. She said that the
Charter Commission did take action and hold a meeting when the City Council
sent the proposal to them. The Charter Commission was advised that it is possible
to send two language options to the voters. The Commission was told that this
would be disastrous. She said that the League of Minnesota Cities and City staff
did not recommend the proposed Charter amendment. The Charter Commission
conducts its deliberations in a responsible fashion. She said that Councilmembers
have been concerned about people being left out. However, on May 15 the
proposed amendment was placed on the Council agenda for consideration when
she was out of town.
Councilmember Lymangood raised a point of order. He said that it is not
allowable under Roberts Rules of Order for a member to attempt to assail the
intent of another member, and that the Mayor's comments are out of order.
Motion was made by Councilmember Lymangood, seconded by Councilmember
Preus, to close discussion for this evening and move to the next agenda item.
Motion carried, five ayes; Tierney nay.
Consider Discretionary Environmental Assessment Worksheet for Plymouth Ponds
Building Four
Councilmember Lymangood stated that a meeting was held at 6 p.m. on this issue.
At the meeting, staff submitted a written update on issues discussed at the
September 4 regular Council meeting. The homeowners then expressed their
concerns relating to the development, while the developer went to a separate
room. The parties were then brought together and there was a good exchange of
60
Plymouth Charter Commission
September 9, 1996
Minutes
Present: Chairman Virgil Schneider, John Duntley, Bob Sipkins, Ellie Singer, Ty
Bujold, Kapila Bobra, Pauline Milner, Bill Pribble, Joy Tierney, Dave
Pauba, Tim Peterson, Assistant City Manager Kathy Lueckert
Excused: Dave Crain, Sandy Patterson, Jon Speck
Call to Order
Virgil Schneider called the meeting to order at 7:03 p.m. He stated that the
purpose of the meeting was to hold a public hearing on the proposed charter amendment
which would require a supermajority vote of the City Council (5 of 7 members voting in
favor) to increase the tax rate. Virgil Schneider stated that after some introductory
comments, he would open the public hearing. Any one in the audience wishing to speak
should fill out a blue card and give it to Mr. Schneider.
Approval of Minutes
The minutes of the August 20, 1996 Charter Commission meeting were approved
as presented.
Introductory Comments
Virgil Schneider introduced Kathy Lueckert, Assistant City Manager.
Comments of Assistant City Manager Kathy Lueckert
Assistant Lueckert stated that the issue under consideration is whether or not the
charter should be amended to require a supermajority vote of the City Council (5 of 7
members in favor) to increase the tax rate. She stated that the idea for a supermajority
vote requirement surfaced during the fall 1995 City Council election campaign. The
initial proposal to enact the supermajority requirement was for the City Council to pass
an ordinance specifying the vote requirement. However, the City Attorney stated that the
Plymouth City Charter did not give the City Council sufficient authority to enact such an
ordinance. The charter must be amended to impose a supermajority requirement.
Assistant Lueckert stated that on May 1, 1996 Councilmember Christian Preus
asked that the City Attorney prepare charter amendments which would enable a
supermajority requirement. The City Attorney proposed three possible amendments. The
first option amends the city charter by placing language directly in the charter requiring a
supermajority vote for any tax rate increase. The second option would amend the charter
so that the supermajority vote could be enacted by ordinance. However, if certain
61
Plymouth Charter Commission
September 9, 1996
adverse fiscal actions occurred, such as a loss of state aid or a dramatic decrease in the
city's tax base, the ordinance could be repealed after a public process. The third option
enables a supermajority vote ordinance in the charter, but provides a mechanism to repeal
the ordinance at any time, after a public process. On May 15, the City Council adopted
the first option, requiring a supermajority vote for any tax rate increase in the charter.
Assistant Lueckert said that state law governs the process for considering the
charter amendment. When the City Council adopts an ordinance amending the charter,
the proposal is sent to the Charter Commission for their consideration. The Charter
Commission is given 60 days to accept or reject the proposal, or to suggest new language
to the City Council. When the Charter Commission makes its recommendation to the
council, the council decides which version—the City Council's version or the Charter
Commission's version, if one is suggested—is placed before the voters. However, state
law also gives the Charter Commission an additional 90 days to review the issue, simply
by notifying the city clerk.
Assistant Lueckert stated that the Charter Commission's 60 day clock began on
May 15. On July 10, the commission notified the city clerk that it needed an additional
90 days to review the proposal. The Charter Commission must report back to the City
Council by October 15.
Comments of Chairman Virgil Schneider
Virgil Schneider explained that the Charter Commission holds an annual meeting
each December to review the past year and to consider any possible charter amendments
in the coming year. At December 1995 meeting, the Charter Commission established a
deadline of April 1, 1996, as the deadline to consider new charter issues. He said that this
deadline was established to provide adequate time for the commission to carefully
consider an issue prior to placing in on the November ballot.
Virgil Schneider stated that the April 1 deadline had passed when City Council
forwarded its supermajority vote proposal to the Charter Commission on May 15. A
special meeting of Charter Commission was called to consider the proposal, despite the
passing of the deadline.
Virgil Schneider said that at a May 23, 1996 meeting the Charter Commission
discussed the proposal for a supermajority vote for a tax rate increase. He said that on
one side of the issue, raising taxes is an important action, not unlike rezoning land, which
does require a supermajority vote. The supermajority proposal is likely to be popular
with voters. On the other side of the issue, a supermajority vote requirement could lead
to minority control of an elected body. In addition, the City of Plymouth has had an
excellent record on controlling taxes, and nearly all budgets have been adopted by a
unanimous vote. Mr. Schneider stated that Plymouth does not have a problem with the
tax rate. He noted that at the May 23 meeting, the Charter Commission felt strongly
61
Plymouth Charter Commission
September 9, 1996
about educating themselves and the public about all aspects of the supermajority
question.
Also at this meeting, the Charter Commission extended an invitation to the City Council
to attend the next Charter Commission meeting on July 9 and explain the reasons for
wanting the supermajority vote requirement in the charter.
Virgil Schneider said that at the July 9, 1996 meeting, Councilmember Christian
Preus attended, and stated that his reason for proposing the amendment is because of his
concern for the future. He agreed that Plymouth does not now have a problem with taxes
or the tax rate, but he believes in taking action before problems occur. Mr. Schneider
said that Councilmember Preus stated that he believes that other levels of government—
the federal and state levels—will push more services down to the local level, but not
provide any funding to cities to provide these services. He thinks that council should
think very hard before raising taxes to provide these services, and that the extra vote
requirement will encourage serious thinking. Mr. Schneider stated that the Charter
Commission expressed concerns about limiting the flexibility of future City Councils,
and about how to deal with vacancies or absences on the council on the night of budget
adoption. The Charter Commission also stated its apprehension about the "tyranny of the
minority."
Mr. Schneider stated that at the July 30 meeting the Charter Commission heard
from City Attorney Roger Knutson. Knutson stated that it is possible that the ballot could
have two possible charter amendments on the same issue, one from the City Council and
one from the Charter Commission. State law provides no guidance should both
amendments pass. The Charter Commission decided to hold a public hearing on the issue
on September 9, and to televise the hearing. The Charter Commission asked that at its
next meeting, speakers from both sides of the issue present information. The
Commission felt that it did not have adequate information to make a decision.
Mr. Schneider said that at the August 20 meeting the Charter Commission heard
from three speakers. Kent Sulem, from the League of Minnesota Cities stated that
Plymouth would be first charter city in Minnesota to have such a restrictive amendment
pertaining to tax rates. The Charter Commission heard that the League believes that it is
unwise to limit flexibility of City Councils in times of fiscal uncertainty, and does not
recommend the amendment. Lynn Reed, from the Minnesota Taxpayer's Association
stated that it is difficult in Minnesota for voters to assign responsibility for taxing
decisions, and that that is the primary reason for public interest in tax and expenditure
limitations. Mr. Reed believes that it is more important to change the current tax system
rather than merely impose new limitations. Mr. Reed stated that the supermajority vote
requirement may not be the best option. Jim Willis, Inver Grove Heights City Manager,
stated that a supermajority vote requirement makes some votes more important than other
votes. If there are real problems in a city, amendments such as these will not fix the real
problems.
43
Plymouth Charter Commission
September 9, 1996
Mr. Schneider stated again that the tonight's purpose is to hear from the public on
the issue of requiring a supermajority (5/7) vote of the City Council to increase the tax
rate. The Charter Commission will then consider its recommendation to the City
Council.
Public Hearing on Supermajority Vote Requirement to Increase the Tax Rate
Chairman Schneider opened the public hearing.
Lynn Reed, Minnesota Taxpayer's Association, 3114 Morgan Avenue North,
Minneapolis spoke on the issue. Mr. Reed said that he was perhaps a little more in favor
of the supermajority requirement than he was at the August meeting. He stated that
voters feel they are not getting "their money's worth" from government. The balance has
shifted so far to the side of spending that average voters feel they have no voice. Mr.
Reed said that in The Federalist Papers the authors stressed the importance of balancing
factions, but that today this concept of balance has been lost. Mr. Reed said that spending
decisions often are automatic, such as salary and benefit increases for government
employees dictated by bargaining agreements. Mr. Reed stated that tax and expenditure
limitations tend to "level the playing field." Mr. Reed said that if the goal of the
supermajority requirement is to make it more difficult to raise the tax rate, that the
requirement would be successful. If the goal is to make it more difficult to raise property
taxes, then the success will depend on the size and health of the tax base. If the goal is to
make it more difficult for the city to spend more, the requirement probably will not be
successful because of fees, licenses, enterprise funds, etc. can be used by a city to offset
spending reductions. Mr. Reed stated that a better goal might be to change the entire tax
classification system. He also suggested a referendum for any spending increases, which
would serve as a balance to City Council actions.
Tim Wold, 1305 Olive Lane North, Plymouth. Mr. Wold stated that he is the
Ward 2 councilmember for the City of Plymouth. He said that the idea for a
supermajority requirement was part of his campaign platform in 1995. He said that he
was glad the Charter Commission decided to televise this meeting. He asked that the
Charter Commission act on the proposed amendment so that it could be placed before the
voters in November. Mr. Wold stated that he would consider alternative language, but
that the City Council's proposal is straightforward and simple. He wants the same
standards that apply to rezoning actions to apply to tax rate increases. Mr. Wold said that
he does not feel that the fear of the tyranny of the minority is an issue, and that there are
rules to protect the rights of the minority, such as Robert's Rules of Order. Mr. Wold
feels that each vote on setting the tax rate is really a litmus test. He urged the Charter
Commission to take action tonight.
Ty Bujold asked Mr. Wold why he felt the supermajority vote was necessary for
taxation. If the City Council has a majority of its members who agree on a tax rate, why
0
Plymouth Charter Commission
September 9, 1996
is an extra vote needed? Mr. Bujold asked why a simple majority was not sufficient for
taxation decisions.
Mr. Wold stated that he feels that the same number of votes necessary for a
rezoning should be required for taxation decisions. He stated that taxes impact every
citizen, that the level of taxes was the one thing he heard about most often on the
campaign trail. Other issues do not matter as much to voters. He stated that the city
should take only the amount needed to accomplish the city's work.
Mr. Schneider stated that the supermajority requirement for rezonings is in state
law, and reflects the permanence of a decision on land. He said that taxation decisions
only last one year, until the next budget is proposed.
Mr. Wold said that once taxes are paid, citizens do not get them back, and do not
receive a refund. In that sense, taxes are just as permanent as rezonings.
Kapila Bobra asked Mr. Wold why the supermajority requirement is needed at
this time. She stated that other cities do not have the requirement, and why should
Plymouth be the first.
Mr. Wold stated that the City Council wanted to be proactive, and to take care of
issues before a problem arises. He said that this City Council has shown such leadership
on a number of issues, such as wetlands, erosion control, and the like.
Bob Sipkins asked Mr. Wold that if taxes are so critical, why not make the vote
requirement a unanimous vote, or why not require a referendum?
Mr. Wold stated that he believes this is a good first step.
Joy Tierney stated that Robert's Rules of Order have been important to Mr. Wold
during his time on the council. She believes that the real issue is not just taxes, but also
one of democratic process: when should the minority be given power? She said that
protection of minorities may be important in the process in meetings. She said that the
council has stated that it has researched the supermajority requirement. She asked Mr.
Wold to answer the question of should the minority be given power, and when should it
be given power?
Mr. Wold stated that he thinks that issue has been well spelled out. Raising taxes
should be as important a rezoning actions. He stated that it is very clear that this is an
important issue.
Joy Tierney said that the council has studied the supermajority question, and the
Charter Commission had examined and studied this issue when developing the charter.
Plymouth Charter Commission
September 9, 1996
She asked why the direct charter amendment requiring the supermajority was proposed,
and why the third option was not.
Mr. Wold stated that the issue must be considered in today's tax climate.
Chuck Lymangood, 11780 401h Place North, Plymouth. Mr. Lymangood said that
he was here to speak on the supermajority vote requirement. He thanked the Charter
Commission for holding hearings on this and other issues in the past. Mr. Lymangood
said that he appreciated the invitation of the Charter Commission to meet on this issue,
but he did not feel it was appropriate. He views the Charter Commission as the
equivalent of a constitutional convention. He believes that it is difficult for the legislative
branch—the City Council—to meet with the constitutional convention. He is willing to
speak at the public hearing, and is prepared to do so tonight. He said that this shows his
respect for the Charter Commission.
Mr. Lymangood stated that Mayor Joy Tierney has a conflict of interest. It is
difficult to serve two bodies.
Bill Pribble stated that it was not Mr. Lymangood's place to challenge the
appropriateness of Joy Tierney serving on the Charter Commission and on the City
Council.
Mr. Lymangood said that Virgil Schneider was the second largest contributor to
Joy Tierney's recent campaign. Mr. Lymangood asked why Joy Tierney would abstain
from a vote on the City Council pertaining to the Charter Commission, but would not
abstain at the Charter Commission meetings.
Mr. Schneider asked to what City Council vote Mr. Lymangood referred.
Mr. Lymangood said that it was the vote by the City Council to call a special
meeting for September 10 to receive the Charter Commission's report, and to encourage
the Charter Commission to make a decision this evening.
Mr. Schneider asked what his campaign contribution decisions had to do with the
supermajority vote proposal.
Mr. Lymangood said that he was concerned about conflicts of interest.
Mr. Schneider stated that the public hearing was on the supermajority vote
requirement. He observed that he also contributed to Mr. Lymangood's campaign. He
said that it was not appropriate to ask Joy Tierney to step down, as she is appointed by the
Chief Judge of Hennepin County.
8 64
Plymouth Charter Commission
September 9, 1996
Mr. Lymangood stated that the reasons why the Charter Commission should vote
for the proposal. (Italicized portions are verbatim from his visual aid.)
Higher taxes are bad, lower taxes are good. Mr. Lymangood stated that any
requirement which makes it harder to increase taxes is good.
Bigger government is bad, smaller government is good. This requirement would
make government smaller and more efficient.
The power to tax is the power to spend. Mr. Lymangood said that the writings of
economist Milton Friedman, while written nearly thirty years ago, are pertinent today
and address many of today's issues. Mr. Lymangood read an excerpt from Milton
Friedman's writings, and stated that government will spend whatever amount of
revenue is raised.
The supermajority requirement is apolitical issue, not a legal or economic issue. Mr.
Lymangood stated that he means political in the sense of its Latin roots, meaning "of
the people." He said that the body politic—the people—are engaged by this issue.
The beauty of this proposal lies in its simplicity. Mr. Lymangood said that this is a
very simple idea, make five votes required instead of four to raise taxes.
There are no better alternatives, only drawing at straws. Mr. Lymangood stated that
this is the best proposal, there are no better options.
This requires action by the Charter Commission. Mr. Lymangood said that the
Charter Commission must act on the supermajority proposal.
Let the people decide. Mr. Lymangood said that the voters should decide this issue,
whether the Charter Commission is in favor of the proposal or not.
The people have already given their tacit approval. Mr. Lymangood pointed out that
the supermajority requirement was part of the pledge of fiscal conservatism by the
Pro Plymouth Team during the 1995 election. Because those candidates were elected,
the people have already indicated their approval of the idea.
Mr. Lymangood said that there are extraneous excuses for not taking action on the
proposal.
The majority does not rule absolutely. Mr. Lymangood stated that the ancient Greeks
created the democratic process. The American contribution to democracy was that
the majority does not rule absolutely. Mr. Lymangood highlighted the requirements
for spending funds from the city's community improvement fund (CIF), which was
created by the Charter Commission. Mr. Lymangood pointed out that some CIF
expenditures require a supermajority vote.
There is nothing more to think about. Mr. Lymangood said that there are no more
issues to be considered. He stated that Plymouth's growth has already slowed
compared to several years ago, so that fear is groundless.
No outside experts will help—just more straws. Mr. Lymangood reminded the
Charter Commission about the issue of what law to follow when the charter is silent
on an issue. The Charter Commission had been advised by an outside expert that
state law would provide guidance. He stated that the question was first raised when a
vacancy existed on the council. Advice from other outside experts was incorrect, and
it was found that a charter city could not rely on state law unless the charter
Gfi
Plymouth Charter Commission
September 9, 1996
specifically directed that. At his prompting and that of Councilmember Nick Granath
the charter was amended to correct the deficiency. Mr. Lymangood stated that relying
on more outside experts in the supermajority instance is not wise.
The people are smart enough to decide, trust the people.
Mr. Lymangood stated that there are significant logistical problems with holding
referendums on spending and taxation decision, and he does not believe that Mr. Reed's
suggestion is useful. In answer to the question of why Plymouth should be the first to
enact such a requirement, Mr. Lymangood said that Plymouth has the lowest tax rate of
any city over 10,000 and that should be protected. In answer to the question of why
should not the vote be a requirement for unanimity, Mr. Lymangood said that the city
already has a supermajority requirement for some issues, so the precedent is already set.
Mr. Lymangood outlined how he believes the Charter Commission should
proceed.
Have Joy Step Down, for her sake and your own integrity. Mr. Lymangood said that
Joy Tierney's membership on both the City Council and the Charter Commission is a
threat to the integrity of the Charter Commission.
Decide or Defer. Mr. Lymangood said that the commission should not prolong its
decision any longer, or the people will not have an opportunity to decide in
November.
The Council and the people are waiting.
Mr. Lymangood stated that the Charter Commission has the knowledge, insight, wisdom
and power, even the obligation, to decide.
Mr. Peterson asked Mr. Lymangood why if this was so important, the Charter
Commission did not receive the proposal until May.
Mr. Lymangood said that the timing was deficient, but that government actions
sometimes move slowly. After the initial opinion that the charter did not permit the
council to enact an ordinance requiring a supermajority vote, City Clerk Laurie Ahrens
and City Attorney Roger Knutson identified the provision in state law which allows
councils to propose charter amendments by ordinance.
Ellie Singer questioned whether or not simple language is the best language. She
observed that rezoning and CIF expenditures have criteria, and why was not the option
containing criteria selected as a proposal.
Mr. Lymangood said that he was merely pointing out the level of decision making
needed to provide a satisfactory comfort level. He also stated that he was merely pointing
out that the majority does not rule absolutely in every case, and that Robert's Rules
protects the rights of the minority.
1 61
Plymouth Charter Commission
September 9, 1996
Ellie Singer asked how it is known that this language is the best language. She
said that the council indicated that it would consider alternatives, but Mr. Lymangood has
stated that this language was the best language.
Mr. Lymangood invited Ms. Singer and the rest of the Charter Commission to
improve upon the proposed language.
Ms. Singer asked Mr. Lymangood why a supermajority requirement would not be
as good for a tax decrease, since that may mean service reductions or increases in fees, as
pointed out by Mr. Reed.
Mr. Lymangood said that most people focus on the tax rate.
Kapila Bobra said that she was not convinced about the proposal. She asked why
not have a supermajority requirement for all financial decisions of the city. She said that
getting agreement among five members is very difficult.
Mr. Lymangood stated that getting agreement has not been difficult in the past,
and that the current council has not experienced deadlocks. Mr. Lymangood stated that
he does not see a problem if five votes are not possible and the tax rate remains at the
same level as the current year. The government can always be changed at the next
election if voters do not like decisions.
Ty Bujold said the federal, state and county levels of government are devolving
services. The local level of government will be required to provide services.
Mr. Lymangood said that the world is indeed changing. It is important to make it
difficult to raise taxes. Decisions on which government level will provide services will
have to be made.
Mr. Bujold said managing government at the local level will be more difficult
when no money is given to provide services. Mr. Bujold said that he feels these decisions
should be vigorously debated, and then the majority should make the decision. Elected
officials should have the intestinal fortitude to make tough decisions.
Mr. Lymangood stated that the majority does not rule absolutely.
Joy Tierney responded to Mr. Lymangood's comments about her serving on both
the City Council and the Charter Commission. She stated that she was appointed to the
Charter Commission prior to her election to City Council. She said that there is no
conflict with her serving on both bodies, and that the Crystal Charter Commission has
three councilmembers currently serving. She does not see a problem. In reference to her
vote on calling a special council meeting for September 10, Joy Tierney said that she
abstained from voting because she did not feel the meeting was necessary. She stated that
1 61
Plymouth Charter Commission
September 9, 1996
this is a political issue. She stated that she missed the City Council meeting when the
supermajority proposal was debated. She said that the Charter Commission does not
focus on politics, but on the philosophical and process aspects of the charter. Ms. Tierney
said it is important to separate the rhetoric from the larger, constitutional issues. She said
that Proposition 13 in California is a good example of the ramifications of spending and
tax limitations, and that such proposals must be considered carefully so that the integrity
of the community is not undermined.
Joy Tierney stated that the Charter Commission took action on the council
vacancy issue and its implications as soon as it was brought to the commission's
attention. The Charter Commission was not frivolous or whimsical in its consideration of
issues. The Charter Commission cannot be dissolved, and that it must meet once a year.
It is a living document. She asked Mr. Lymangood why a vote must be taken tonight.
She said that the Charter Commission heard the council loud and clear abut the political
side of things.
Mr. Lymangood said that he never used the words "frivolous or whimsical" in
describing the Charter Commission's work. He stated that the Charter Commission did
its work well, but that it was wrongly advised about the application of state law. He said
that this is a matter of record, and had to be corrected.
Mr. Schneider stated that experts had given advice to the Charter Commission
wrongly, but that the problem has been corrected.
Mr. Lymangood said that the wrong advice is responsible for the thinness of the
charter. He stated that the point is that the issue was raised by himself and
councilmember Granath, and not by outside experts, and that the opinions of himself and
Mr. Granath prevailed. He observed that sometimes experts on an issue are right in your
midst. Mr. Lymangood said that Ms. Tierney did not understand his reference to
political. He said that he was using it in the broad sense—"of the people." The Charter
Commission's obligation rests in letting the people decide in November.
John Duntley stated that he felt like he was watching a tennis match. He asked
Mr. Lymangood about what Milton Friedman had to say on supermajority requirements.
Mr. Lymangood said that Milton Friedman believes that higher taxes are not a
good thing. Mr. Lymangood believes that to look for answers in outside experts is not
the answer, but it is important to go to the people and to ask them.
Mr. Peterson stated that all Charter Commission meetings are public meetings.
Mr. Peterson highlighted Mr. Reed's statement about clarifying the intended goal: if the
goal is to make spending more difficult, then the supermajority requirement will be less
successful.
7.o
Plymouth Charter Commission
September 9, 1996
Mr. Lymangood stated that Mr. Reed also recommended a referendum, which is
not feasible.
Bill Pribble asked if Mr. Lymangood saw any negative aspects to the
supermajority proposal.
Mr. Lymangood said that he knew of no negative aspects.
Mr. Pribble asked if a requirement for a unanimous vote would empower a
minority. He asked if some service or program might have such a high value as a social
good that taxes should be increased to provide it.
Mr. Lymangood stated that he knew of no pending or foreseeable situation facubg
the City Council which would make raising taxes a good action.
Christian Preus, 16205 5`'' Avenue North, Plymouth. Mr. Preus stated that he is an
at -large member of the Plymouth City Council. He stated that he had intended only to
listen this evening. He addressed Tim Peterson's questions of why the issue had not been
brought to the Charter Commission earlier. Mr. Preus stated that when he first raised the
issue, he was not aware of the Charter Commission's April 1 deadline. Mr. Preus had
surfaced the issue earlier, but the city attorney had reservations about a simple ordinance
to enact the supermajority requirement. City Attorney Knutson had said that while the
City Council could adopt an ordinance, it was unclear in the charter whether or not that
ordinance could be enforced. Mr. Preus said that it can be implied from the charter that
the council cannot place additional restrictions on itself for purposes of budgeting and
taxation. Mr. Preus said that he interprets the charter to be more permissive, but he did
not want this to be come a legal issue and so accepted Mr. Knutson's interpretation.
Mr. Preus stated that the announcement that the supermajority vote would be
considered was made one meeting in advance (May 1) of the May 15 council meeting
when the proposal was approved and forwarded to the Charter Commission. Mr. Preus
said that he did not know that Mayor Tierney would be absent at the May 15 meeting. He
said that councilmember Nick Granath made the best case for the first option, describing
it as the best choice.
Mr. Preus said that he never thought this issue would receive so much attention,
and that he had somewhat misjudged the interest in it. He said that he looks at the issue
as a simple matter. It is not an attempt to end increased government spending, but is one
small, positive step to attempt to control it. He said that the Charter Commission
discussion has shown all sides of the issue.
Mr. Preus urged the Charter Commission to make its decision tonight. He said
that the commission has given the matter much thought, but that the decision is not
difficult. He said that this has been a different process to get the issue to the Charter
Plymouth Charter Commission
September 9, 1996
Commission. Some commission members may agree with the proposal, and some may
disagree, but it is important for the commission to decide.
Mr. Bujold asked why raising the tax rate could not merely be a subject of
vigorous debate, and then let the majority rule. He observed that all councilmembers are
thinking, articulate individuals who can debate an issue thoroughly. He wondered why
the reliance on a supermajority rule was necessary.
Mr. Preus stated that the Federalist Papers were mentioned earlier in the evening,
and that he too is an admirer of those papers. He said that the founding fathers were
concerned with factions, not with parties. Mr. Preus stated that the balance has tilted too
far in favor of spending. He hopes that the federal and state levels of government will
continue to decrease in size. He feels that the supermajority rule will be more of a check
on spending. He sees tough decisions in the future on what services should be provided,
and that taxing actions always trend upwards.
Ellie Singer stated that each issue brought to the Charter Commission receives the
attention it deserves. The Charter Commission takes its role seriously, and is mindful of
taking a long term view and educating themselves. She noted that in 1997 the tax rate
decrease will actually result in a slight tax dollar increase. She asked how the
supermajority rule would apply in this situation.
Mr. Preus stated that the rule would have no impact.
Ms. Singer stated that if the supermajority rule would have had no impact in 1997
even if it was now in the charter, Plymouth residents would still pay more taxes and so
spending is not reduced.
Mr. Preus stated that he is impressed with the breadth of the examination given
the issue by the Charter Commission. He had not expected that, and had anticipated a
narrower viewpoint.
Virgil Schneider said that the Charter Commission believes strongly in educating
itself about issues and its role in educating the public, and that is the primary reason for
public hearings such as this. Mr. Schneider said that process is important.
Bob Sipkins clarified that until attorney advice to the contrary was received, the
council thought it could adopt an ordinance requiring a supermajority vote. Mr. Sipkins
stated that the Charter Commission could recommend an amendment which would enable
such an ordinance, similar to the third option presented to the City Council.
Virgil Schneider said that that option was not given to the Charter Commission,
only the more restrictive language was presented.
3 z
Plymouth Charter Commission
September 9, 1996
Bob Sipkins asked about the rationale for the more restrictive language, as it
seems to limit the flexibility of future councils. He asked for Mr. Preus' comments.
Mr. Preus stated that an ordinance can be changed from year to year, and the more
restrictive language will prevent councils from tinkering with the requirement.
Ty Bujold asked if Mr. Preus could foresee a time when a six sevenths vote might
be required.
Mr. Preus stated that the question is one of what is a reasonable level or standard
for approval. He feels that a six sevenths requirement is too high a level.
Mr. Bujold asked that if the proposed amendment required six sevenths instead of
five sevenths, did Mr. Preus think it would be approved by voters.
Mr. Preus stated that he was not certain it would pass.
Mr. Bujold stated that he feels the Charter Commission needs more debate on the
issue. The difference between standards of simple majority, five sevenths, six sevenths,
or unanimity is important to consider when adding a requirement to the city's
constitution. He feels this question may need more "aging."
Ellie Singer stated that the proposed language is simple. She asked if Mr. Preus
would be open to alternative language.
Mr. Preus responded that he would be open to alternative language.
Joy Tierney stated that questions have arisen about whether or not the mayor can
objectively debate issues of government. She is concerned about the process surrounding
the supermajority proposal. She stated that Mr. Preus came to the July Charter
Commission on his own volition, and that the council had not appointed him their
representative. Ms. Tierney asked how much debate the council had about the proposal.
She asked what Mr. Preus thought about the possibility of having two different proposals
on the ballot, one from the council and one from the Charter Commission. She asked
what the obligation was of the Charter Commission to make a decision tonight.
Mr. Preus stated that it was his impression that the City Council wanted him to
attend the July Charter Commission meeting. He heard of the suggestion of two
proposals on the ballot this summer. He stated that two proposals is not a sensible way of
dealing with an issue. Mr. Preus said that he would not use the word obligation for the
Charter Commission, but he thinks that the commission has enough information and
should make a decision.
33
Plymouth Charter Commission
September 9, 1996
Ms. Tierney asked if Mr. Preus had voted to call the special council meeting on
September 10.
Mr. Preus responded that he had voted to call the special meeting. He noted that
issues can come to the Charter Commission in many ways. The council has used one of
these methods, and the Charter Commission must now respond back to the council.
Ms. Tierney said that the Charter Commission has concerns about the proposal,
and that the choice and decision are not obvious. She stated that she doesn't feel that the
council adequately debated the supermajority proposal. There is a possibility to have two
proposed amendments, and that possibility was not discussed by the council. She says
that the City Council missed this important issue. She is interested in working with the
council to devise a proposal which is in the long term interests of the city.
Mr. Preus responded that that state law has always made it possible to have two
proposed amendments, and that the council can do nothing about that. Two proposals are
not the route he wishes to take, and he does not want two conflicting proposals before the
voters.
Tim Wold 1305 Olive Lane North, Plymouth. Mr. Wold stated that he
appreciated Mr. Pribble's question about making it harder to raise taxes to deal with a
social good. He stated that the supermajority rule would make it harder to make the case
for an important program, and that he would have to work diligently to prove the need.
He asked again that the Charter Commission make a decision tonight.
Virgil Schneider closed the public hearing.
Discussion of Supermajority Proposal
Virgil Schneider said that he was disappointed with the public turnout, and that
the speakers included three elected officials and one invited speaker. He said that there is
not an apparent public outcry about the supermajority rule. He asked what actions the
Charter Commission wished to take.
Joy Tierney said it was important to be clear about what is being debated. The
Charter Commission was only given one proposal to consider. The commission can
propose alternative language to the council or can simply reject the proposal.
Virgil Schneider explained the three options considered by the council. He stated
that the first proposal, the one given to the Charter Commission, places language directly
in the charter which requires a supermajority vote. The second proposal enables the
council to adopt an ordinance requiring a supermajority vote, and specifies the criteria by
which the ordinance could be repealed, such as loss of state aid beyond a certain
percentage. The third proposal enables the council to adopt an ordinance requiring a
supermajority vote, which can be repealed after a specified public process.
3N
Plymouth Charter Commission
September 9, 1996
Joy Tierney asked if Plymouth were still a statutory city, could the City Council
pass an ordinance requiring a supermajority vote.
Assistant Lueckert stated that this would take research to answer.
Ty Bujold moved, seconded by Bill Pribble, that the Charter Commission
make no decision tonight but table further consideration of the supermajority
proposal until the next Charter Commission meeting.
Virgil Schneider called for discussion of the motion.
Dave Pauba said he speaks against the motion. He feels that he has enough
information, and he does not want to spend $13,000 of tax dollars for a special election
for this issue.
Bob Sipkins stated that he agreed with the last comment. He said he has heard
enough. He is ready to vote on the council's proposal or to make a recommendation on a
new proposal.
Joy Tierney asked Bob Sipkins what alternative he would propose.
Mr. Sipkins stated that he is comfortable with the third option. He is loathe to
hamstring future councils. He is amenable to an ordinance, but does not want the
restrictive language in the charter. He said he has not heard a compelling argument for
the restriction, and that Plymouth currently does not now have a problem with taxes or
the tax rate. He said that the first option is a simplistic solution to a non -problem. He
would prefer to give the council the option through language enabling an ordinance.
Ty Bujold said he agreed with Mr. Sipkins. He is not comfortable with the
current proposal, but he is uncertain whether or not the other options are any better. He
would like to work together with the council to find a solution agreeable to both bodies.
He warned against hasty decisions, and said that with no public here it does not seem to
be an important issue.
Bill Pribble stated that is is opposed to the supermajority requirement in any
format. It is his view that it is only done to enable minority control. He suggested that
the Charter Commission devise its own language which would prevent minority control.
Virgil Schneider called for a vote on the motion to table consideration of the
supermajority issue until the next Charter Commission meeting.
Commissioners Duntley, Bujold, Schneider, Pribble, Tierney, and Bobra
voted in the affirmative.
Plymouth Charter Commission
September 9, 1996
Commissioners Singer, Sipkins, Pauba, Milner, and Peterson voted in the
negative.
The motion passed, 6-5.
The Charter Commission discussed possible dates for a meeting.
Ellie Singer moved, seconded by Bill Pribble, to establish a Charter
Commission meeting for Monday, September 30 at 7 p.m. in the Public Safety
Training Room. The motion carried.
Virgil Schneider asked what additional information the Charter Commission
wanted in preparation for that meeting.
Joy Tierney stated that the commission could consider the other two options, or
write their own language.
Bob Sipkins said that the Charter Commission must answer the basic question of
how it views supermajority requirements in general, and should such a requirement be
language in the charter or language enabling an ordinance.
Virgil Schneider stated his preference for having the City Council be more a part
of devising a solution that is palatable to both bodies. He does not want two options on
the ballot.
Bob Sipkins asked if Mr. Lymangood would be willing to consider alternative
language.
Mr. Lymangood responded that anything was better than nothing.
Mr. Sipkins asked if the third option was acceptable.
Mr. Lymangood said that the third option was preferable to having two measures
on the ballot. He urged the commission to make a motion to reconsider the previous
question, and perhaps then vote on an alternative proposal.
Virgil Schneider stated that the first option was the only one presented to the
Charter Commission. The message sent was that this was the only option that was
acceptable.
Ellie Singer asked if Mr. Lymangood would be willing to work with the Charter
Commission, given his concerns about the separation between legislative and
constitutional bodies.
Plymouth Charter Commission
September 9, 1996
Mr. Lymangood responded that he would work with the Charter Commission only
in a public hearing format like tonight, and that was televised. He noted that Mayor
Tierney's vote was the tie-breaker on the motion to table.
Virgil Schneider said that if Joy Tierney had not voted, the motion would have
failed and nothing would have passed. Mr. Lymangood stated that we do not know that.
Mr. Sipkins stated that Mr. Lymangood's response to Ms. Singer's question about
working with the commission was a non -answer. He said that Mr. Lymangood did
present a compelling argument, but that he also was grandstanding. Mr. Sipkins said that
friction between the council and the Charter Commission could have been reduced if Mr.
Lymangood had not stood behind the public hearing.
Mr. Lymangood said that he was expressing his respect for the Charter
Commission, and he does not want to be confrontational. His concern for a non -televised
meeting of the two bodies is his issue.
Joy Tierney asked what Mr. Lymangood sees as the process to resolve this issue.
Mr. Lymangood responded that the Charter Commission should reconsider the
previous motion to table and consider the proposal tonight.
Ms. Tierney asked if the commission had enough options to consider.
Mr. Lymangood said that other ordinances would have surfaced already, if other
options were available.
Virgil Schneider said that the Charter Commission received all the options as part
of the information it receives on the topic, but that the City Council proposed only the
first option to the Charter Commission. The commission's discussions have focused only
on that issue.
Tim Peterson stressed that the Charter Commission should make its decision on
September 30 and forward its report to the City Council.
Adjournment
Virgil Schneider adjourned the meeting at 9:58 p.m.
r
DATE: September 10, 1996
TO: Mayor and City Council
FROM: Kathy Lueckert, Assistant City Manager
SUBJECT: Report from Charter Commission Public Hearing
On September 9, 1996 the Charter Commission held a public hearing on the proposed
supermajority vote requirement for a tax rate increase. The Commission heard testimony
from interested parties for nearly two hours.
The Charter Commission voted 6-5 to defer action on the proposed charter amendment
until their next meeting, on Monday, September 30, at 7 p.m. in the Public Safety Training
Room. The Charter Commission will make its report by the deadline, October 15, 1996.
The vote on the motion to table action until September 30 was as follows:
Ayes: Duntley, Bujold, Schneider, Tierney, Pribble, Bobra
Nays: Singer, Sipkins, Pauba, Milner, Peterson
Absent: Crain, Patterson, Speck
DATE: September 17, 1996
TO: Mayor and City Council
FROM: Dwight D. Johnson, City Manager
SUBJECT: Status of Supermajority Vote for Tax Rate Increase Issue
At the September 10 Council meeting, I was asked to provide a report at the next regular
Council meeting on September 18'` on the overall background and current status of this
issue. A considerable amount of background information has been provided in the packet.
This is a summary of some of the key points.
Background.
This issue was first raised at a Council meeting on May 1, 1996 when Councilmember
Preus announced that he had asked staff to investigate alternatives presentation at the
May 15`
s Council meeting.
The Council was presented with options at the May 15`s
meeting, and approved an
ordinance pursuant to "option 1" and forwarded it to the Charter Commission as
required by law.
The Charter Commission met on five occasions to consider this matter. At the first
meeting on May 23`
d,
they invited the City Council to attend the next meeting.
The Council had discussion of this invitation on the June 5`h agenda, but the meeting
was lengthy and was adjourned before it could be discussed. On June 19'x, the Council
did discuss the matter. The Council also voted on June 19'h to affirm that the 5/7
voting requirement is "good public policy," encouraged the Charter Commission to act
forthwith" so that a vote on the issue could occur in 1996, and suggested that the
Charter Commission could hold a public hearing.
On June 2e, the Council discussed the issue again and Councilmember Preus offered
to attend the July 9h
Charter Commission meeting with the encouragement of other
Council members.
The Charter Commission met on July 9`s and Councilmember Preus presented his
views on the subject. The Charter Commission voted to ask for an additional 90 days
to make its report on the matter.
I
On July 10', Councilmember Preus reported on the July 9`h meeting to the City
Council.
The Charter Commission met on July 30`
s and heard from City Attorney Roger
Knutson. They also decided to hold a public hearing on the issue and asked for
speakers on both sides of the issue to present information at their next meeting.
At their August 20'h meeting, the Charter Commission received testimony from an
official of the League of Minnesota Cities, a representative of the Minnesota
Taxpayer's Association, and the former City Manager of the City.
On August 21", the City Council directed staff to report on the funding needed for one
special election in 1997 at the next Budget Study Session. The Council also passed a
motion to "respectfully request that the Charter Commission make a recommendation"
on September 9's.
The Charter Commission's public hearing was held on September 9t`,
and
Councilmembers Wold, Lymangood, and Preus spoke in addition to a representative
of the Minnesota Taxpayer's Association. The Charter Commission discussed the
issue and voted to table further consideration until September 30''.
New Developments. The deadline for an issue to appear on the November 5`s ballot
passed at 5 p.m. on September 110'. However, last Friday, September 13th, staff verified
with the City Attorney that a paper ballot election could be held in conjunction with the
November 5`h balloting .if both the Charter Commission could make its report and the
Council could act on it by 5 p.m. on this coming Friday, September 20`
s. This information
was provided to all council members by memo and voice mail on the 13`h of September.
The memorandum was also mailed to all members of the Charter Commission with their
regular council agenda mailing on the I.P. The Chair or any two members of the Charter
Commission may call a meeting. No call for a meeting has occurred to this date. Three
members of the City Council have called a special council meeting for noon on Friday,
September 20`s, to consider the issue if action by the Charter Commission occurs prior to
that date.
Current Status.
The Council cannot simply pass an ordinance on its own, because the City Council has
been advised by the City Attorney that the authority to do so in the current City Charter is
lacking.
This matter cannot be placed on the general election ballot at this time because the
County's deadline for printing the ballots expired on September 11`x.
The Council cannot take action at this time to place the matter on a special election ballot,
either on November 5t' or any other date, because the law states that the Council must
first receive the report of the Charter Commission. The Charter Commission's deadline
for reporting under the law is October 15''.
Council Actions on September 10, 1996:
The Council approved the following actions at their September 10 meeting:
1. That meticulous notes of that meeting be taken; that the supermajority voting issue
for tax rate increases by placed on the agenda of the next regular meeting, along with
the proposed 1997 budget; that the Charter Commission public hearing minutes be
distributed to the City Council; and that the outline of Councilmember Lymangood's
comments at the Charter Commission meeting be added to the minutes of the
September 10h meeting. (Done)
2. That the City Manager give a summary of the September 10'h
meeting at the next
regular Council meeting. (Done)
3. That staff note on the report of the Charter Commission's actions which members
voted for and against the tabling action. (Done)
4. That staff provide options and timelines at the next Council meeting for calling a
special election the proposed Charter amendment. (See below).
5. That staff present three options for ongoing showings of the Charter Commission's
public hearing of September 9`h. (See below).
Special Election Options.
Staff has identified three special election options:
1. Vote on December 3`d,
1996. This is the earliest voting date if the Charter Commission
takes the full length of time available to it for deliberation.
2. Vote in May, 1997. This election date would be in time for the development of the
1998 City budget.
3. Vote in November, 1997. Our special election could be held with planned elections for
the Wayzata and Robbinsdale School Districts.
One additional option has been identified by staff since last week.
4. Vote on November 19'', 1996 if the Charter Commission completes its report at its
scheduled September 30ei meeting and if the Council would want to act on it on
October 2°d, 1996.
Options for showing Charter Commission Public Hearing on Cable TV.
Three options have been developed for showing the Charter Commission public hearing
on an ongoing basis as requested by the City Council. These include:
I. Continuous 24 hour per day showings. There would be no other City meetings shown
and no video text time.
2. Continue showing other City meetings from Monday through Thursday, and show the
Charter Commission on a four hour interval basis on Friday, Saturday, and Sunday,
leaving about an hour of video text information between replays. This option would
allow 17 charter commission replays per week.
3. Option 3 is similar to option 1, but allows for video text for about 15 minutes after
each replay, thus allowing the Charter Commission hearing to start on top of the hour
every three hours.
I
Minutes
Special Council Meeting
September 20, 1996
A special meeting of the Plymouth City Council was called to order by Deputy Mayor
Lymangood at 12:03 p.m. in the Council Chambers, 3400 Plymouth Blvd., on
September 20, 1996.
COUNCIL PRESENT: Deputy Mayor Lymangood; Councilmembers Anderson, Black,
Wold, and Granath.
ABSENT: Councilmember Preus and Mayor Tierney.
STAFF PRESENT: Assistant City Manager Lueckert and City Clerk Ahrens.
Deputy Mayor Lymangood called the meeting to order at 12:07 p.m. He stated that the
purpose of the meeting is to consider and act on any action by the Plymouth Charter
Commission on the proposed charter amendment relating to a super -majority vote
requirement for a tax levy increase.
Assistant City Manager Lueckert reported that the Charter Commission has not met this
week and has no report to forward to the City Council. She explained that the Charter
Commission met on Monday, September 9, and held a public hearing on the super -
majority vote issue. At the conclusion of that meeting, the Charter Commission tabled
the issue until Monday, September 30. There was an opportunity, had the Charter
Commission met this week and made a report, to still have the proposed charter
amendment placed on the November 5 general election ballot. This was communicated
to the Charter Commission.
Councilmember Wold stated that at the September 9 meeting, the Charter Commission
failed to act and tabled the issue for further study. He asked Assistant Manager Lueckert
to clarify what additional information or testimony the Charter Commission is waiting on
in order that they would feel able to act.
Assistant Manager Lueckert said that she cannot speak for the Charter Commission. She
has not received a request for additional information for the September 30 meeting.
Perhaps the Commission wanted additional time to consider the information they
received at the public hearing.
Councilmember Anderson asked if staff received any responses from Charter
Commission members as to why they did not call a meeting this week.
Assistant Manager Lueckert responded that she only spoken directly to the Chairperson,
Virgil Schneider. He had a personal conflict with attending meetings later in the week,
Qx
Special Council Meeting
September 20, 1996
Page 2
and he saw no need or reason to meet prior to the next scheduled meeting of
September 30.
Councilmember Anderson stated that because the Charter Commission has failed to act,
the City Council will be unable to place the proposed amendment on the November
ballot.
Councilmember Granath asked how the Charter Commission was informed that if they
acted this week, there would still be an opportunity to get the amendment on the
November ballot.
Assistant Manager Lueckert stated that the Charter Commissioners received the same
information as the City Council one week ago, which explained the possible scenario of
getting the issue on the November ballot.
Councilmember Wold stated that he had originated the call for this special meeting
because he wanted it to be very clear that the City Council is ready to act. It would have
been remiss for the Council not to be prepared to act, should the Charter Commission
have met and submitted a report. He said this is an important issue and it is important
that the public gets the opportunity to make the decision of whether it should be adopted.
He stated that the citizens should have had an opportunity to vote on this issue on
November 5.
Councilmember Granath stated that he was one of the three Councilmembers who called
this special meeting. He respects the members of the Charter Commission but believes
that the City Council has "passed them the ball and they have buried it." He noted that
the Charter Commission had an additional opportunity to correct the situation by calling a
special meeting this week and submitting a report, but they failed to do so. He has heard
Charter Commission members comment "what is the rush?" He said that the Council is
simply trying to get the issue to the voters. There will not be a general election of this
magnitude until the next century. He believes the proposed amendment is a common
sense proposal, and he is unsure how Charter Commission members stand on the issue
because they failed to vote on it. The Charter Commission only voted to delay, and
tabled the entire issue to September 30. He regrets the extent to which this proposed
amendment has become an issue between the Charter Commission and the City Council.
He believes that there are no winners, and the taxpayers will be the losers.
Councilmember Granath said that he heard Charter Commission members, including
Mayor Tierney, say they felt they were pushed by the City Council. He said that only the
voters and taxpayers will be hurt. The City Council has not said that they will cut
services. In fact, the past few years the Council has expanded services while cutting
costs. He said that the issue cannot go before the voters because the Charter
Commission, including Mayor Tierney, didn't act.
43
Special Council Meeting
September 20, 1996
Page 3
Councilmember Lymangood explained that a requirement of the Open Meeting Law is a
minimum three-day notice of special meetings. He said that today's special meeting was
called on Friday, September 13. This was when the Council first learned that in the event
the Charter Commission would have called a special meeting and submitted a report to
the Council by today, the City Council could have acted to add the proposed amendment
to the November 5 general election. He stated that the City Council called the special
meeting for today in order to be prepared to act.
Councilmember Anderson added historical perspective on the issue. He explained that he
became involved in local politics six years ago because there was a problem with the City
Council voting to extend their terms of office without citizen input. He formed the
League of Plymouth Voters. At that time, Joy Tierney was the President of the League of
Women Voters for Plymouth. The League of Plymouth Voters asked the League of
Women Voters to support the quest to allow voters to decide whether terms of office
should be extended. He stated that Joy Tierney would not let the League of Women
Voters take a position because she could not decide on the issue. He said that "paralysis
of analysis" occurred six years ago on that issue and it has occurred again on the super -
majority vote issue. It is a pattern and the voters have a clear choice this fall. He stated
that a minority of people - the Charter Commission - want to decide the fate of 50,000
residents. He stated that leadership is expected in this situation, and leadership has fallen
down. He said that leader is the Mayor of Plymouth who didn't act six years ago and
didn't act in this situation. Councilmember Anderson explained that these comments are
made as background information to what is now before the Council. He stated that the
deciding vote to table this issue on the Charter Commission was made by Mayor Tierney.
Deputy Mayor Lymangood read the call of the meeting and respectfully requested that
remarks be kept pertinent to that call.
Councilmember Granath stated that he believes Mayor Tierney interjected herself
squarely into this issue. She was asked to avoid a conflict of interest at the Charter
Commission meeting and she chose not to do that.
Councilmember Black agreed with the previous comments. She has respect for the
difficult job of the Charter Commission, but believes this is simply about placing an
important issue before the voters. Citizens allow the Council to run the City, and citizens
should be allowed a voice on this issue. She stated that the greatest number of residents
will be voting at the November 5 general election than will occur again until 2000. This
issue needs the greatest number of residents voting and shouldn't be decided by a small
portion of the voting population. She said that a smaller number of voters will decide the
issue if it is done at a special election or in the 1998 general election. She may have a
difficult time voting to place the issue on the ballot at those elections because of the small
number of people voting.
tq
Special Council Meeting
September 20, 1996
Page 4
Councilmember Wold said it is unfortunate that the Council does not have something to
vote on. He believes that these comments have been important for the public record. The
City Council will receive a recommendation from the Charter Commission, but he does
not know how much influence that recommendation will have with him because he
believes that recommendations should be timely.
Councilmember Lymangood announced that the next Charter Commission meeting is
scheduled for September 30 at 7 p.m. He reminded Councilmembers that they may wish
to attend that meeting. He stated that the City Council has not received an official request
from the Charter Commission that any Councilmembers attend.
Councilmember Lymangood said that in the event the Charter Commission makes a
recommendation on September 30, the City Council can consider the issue at their regular
meeting on October 2.
Assistant Manager Lueckert said that the statutes allow the Charter Commission until
October 15 to make their report. If that is the case, the City Council has a regular Council
meeting scheduled on October 16.
Councilmember Lymangood stated that the City Council will be prepared to act at either
time.
Motion was made by Councilmember Anderson, seconded by Councilmember Black, to
adjourn the meeting at 12:25 p.m. Motion carried, five ayes.
City Clerk
fr
Agenda Number:
TO: Mayor and City Council
FROM: Kathy Lueckert, Assistant City Manager on behalf of the
Plymouth Charter Commission
SUBJECT: Charter Commission Action on Proposed Supermajority Vote
Amendment to Plymouth City Charter
DATE: October 1, 1996 for October 2, 1996 City Council Meeting
1. ACTION REQUESTED: Receive report on Charter Commission Action on Proposed
Supermajority Vote Amendment to Plymouth City Charter
2. BACKGROUND: On May 15, 1996 the Plymouth City Council forwarded a
proposed charter amendment to the Plymouth Charter Commission. The proposed
amendment would require a supermajority vote (five of seven councilmembers voting in
favor) to increase the tax rate. State law allows the Charter Commission sixty days to
review the proposal. An additional ninety days is available to the Charter Commission
after notifying the city clerk. The Charter Commission must take action on the proposed
amendment by October 15, 1996.
3. DISCUSSION: At its meeting on September 30, the Charter Commission took action on
the proposed supermajority requirement amendment. The action taken was to reject the
charter amendment proposed by the City Council. The motions stating the action of the
Charter Commission on the proposal, as well as the reasons for their action, are attached.
The unapproved minutes of this meeting also are attached.
14
Plymouth Charter Commission
September 30, 1996
Motion by Bill Pribble, seconded by Bujold:
The Plymouth Charter Commission rejects the charter amendment proposed by the
Plymouth City Council which would require a supermajority vote of the City Council to
approve a tax rate increase.
The motion carried.
Commissioners Bujold, Pribble, Milner, Patterson, Speck, Duntley vote aye.
Commissioners Peterson, Sipkins, Singer, Bobra, Schneider vote nay.
Motion by Tv Buiold, seconded by Bill Pribble:
The Plymouth Charter Commission hereby gives its reasons for rejecting the proposed charter
amendment requiring a supermajority vote for a tax rate increase:
1. There has been no public support for the concept of a supermajority requirement for the
increase of a tax rate.
2. A supermajority rule does not represent good government as it relates to issues of taxation.
We endorse the principle of majority, rule when it comes to fiscal responsibility.
3. As a matter of constitutional law, we do not believe that future councils should be bound
by a supermajority voting requirement on fiscal matters. Such issues should be resolved by
traditional democratic procedures, at the heart of which is the majority rule.
4. Expert testimony presented to the City Charter Commission has not supported the idea of a
supermajority requirement. The contrary has been true.
5. In the two year process of drafting the City Charter, this Commission considered and
rejected the supermajority concept as it related to taxation.
6. The Charter Commission is irrevocably opposed to the concept of the "tyranny of the
minority." Issues relating to taxation ought to be controlled by the majority.
7. The Charter commission is not opposed to future reconsideration of the supermajority
requirement if valid evidence in support of the concept is presented.
8. The supermajority requirement does not exist in the form proposed in any other Minnesota
city charter.
914
The motion carried.
Commissioners Bujold, Speck, Pribble, Schneider, Bobra, Milner, Patterson, Duntley, Singer,
Sipkins voted aye.
Commissioner Peterson voted nay.
Motion by Virgil Schneider. seconded by Bill Pribble:
The Plymouth Charter Commission directs staff to forward to the City Council the
September 30, 1996 minutes and motions approving the actions and decision of the Charter
Commission as soon as these are ready.
The motion carried unanimously.
III
Plymouth Charter Commission
September 30, 1996
Minutes
Present: Virgil Schneider, Pauline Milner, Jon Speck, Sandy Patterson,
Kapila Bobra, John Duntley, Ellie Singer, Bob Sipkins, Tim Peterson,
Bill Pribble, Ty Bujold, Assistant City Manager Kathy Lueckert
Excused: Dave Pauba, Dave Crain, Joy Tierney
Call to Order
Virgil Schneider called the meeting to order at 7 p.m.
Approval of Minutes
Tim Peterson noted a spelling correction on page 11 of the minutes of the
September 9 meeting. Kapila Bobra moved, seconded by Bill Pribble, to approve the
minutes as corrected.
Discussion of Proposed Supermaiority Amendment to Charter
Virgil Schneider noted that there were several citizens present who wished to
speak on the supermajority issue. He noted that this meeting was not a public hearing,
but he would entertain a motion to open the meeting to hear from the citizens. Ty Bujold
moved, seconded by Ellie Singer, to permit the citizens present to speak. The
motion carried.
Gene Schroeder, 14805 18`h Avenue North, Plymouth. Mr. Schroeder stated that
he has lived in Plymouth for 28 years. He urged the Charter Commission to go no further
in its consideration of the supermajority requirement. Mr. Schroeder stated that the
United States is a democratic republic, and that government by the people means majority
rule. Majority rule is evident in nearly every aspect of life. Mr. Schroeder said that a two
thirds requirement means that a minority of 34% can revoke majority rule. He noted that
in January 1995 the House of Representatives imposed a supermajority vote requirement
for tax rate increases. This rule was called upon six times, but was waived five out of
those six times. Mr. Schroeder sees no compelling reason to place the supermajority
requirement in the Charter. He wants to avoid oligarchy, or rule by the few.
John Tierney, 17915 201h Avenue North, Plymouth. Mr. Tierney stated that he has
been a resident of Plymouth for 27 years, and that he is speaking only for himself. He
stated that the concept of majority rule is an important one. It is not perfect, but has
served the nation well. He said that it is important to consider the framing of the question
of a supermajority vote requirement. Mr. Tierney said that if the supermajority vote was
0
Plymouth Charter Commission
September 30, 1996
Page 2
required for street repair or ice rinks, that it might not be an issue. He said that the only
reason the supermajority question is now raised is because it deals with taxes. Mr.
Tierney said that the city charter is like a constitution. He said that he is speaking
because of what he saw on television at the Charter Commission hearing. He said that
the question is whether the amendment should be approved in its current form, or whether
another option is possible. The current proposal is only a placebo, with no guarantees of
success. Mr. Tierney said that the proposal is not really an issue of a tax increase, but has
other implications. He noted the Plymouth has a low tax rate, and a AAA bond rating.
These achievements were not the result of slogans or quick fixes, but of long term careful
planning and management. Mr. Tierney said that the fiscal uncertainties at other levels of
government make this amendment unwise at this time. Mr. Tierney thanked commission
members for serving, and for their experience and thoughtfulness.
Judy Johnson, 12950 301h Avenue North, Plymouth. Ms. Johnson said she is a
resident of Plymouth and a candidate for the at -large seat on the Plymouth City Council.
She said that she has listened to the debate on the supermajority issue. She sees it as a
sensitive issue, and she also says it is a political issue. She said that one question asked a
about the issue is what is the urgency. She has asked voters if they think their tax dollars
are spent wisely. Ms. Johnson said that the voters she has spoken with have faith in their
city government, and feel that the city council is making good decisions. She does not
sense any urgency by voters to look at a supermajority requirement. Ms. Johnson stated
that people are concerned about taxes, but at other government levels.
Bob Sipkins asked Ms. Johnson if he had heard her correctly that people are not
concerned about the supermajority issue.
Ms. Johnson noted that the supermajority requirement is not an easy issue to
explain, but that it is not on the public's list of issues. She said that much more
community involvement and discussion is needed on the issue.
Kapila Bobra agreed that most people don't understand the issue, and don't
understand why the supermajority requirement is needed at this time.
Ty Bujold stated that he had done research on the supermajority issue at the state
level. In February 1993, a House proposal to require a supermajority vote on any tax rate
legislation was defeated. In April 1993, a supermajority requirement amendment to a bill
was defeated. In March 1995, a bill amendment requiring a supermajority for a tax rate
increase was defeated. There also was legislation in 1996 requiring a supermajority vote.
Mr. Bujold said that this indicates there is debate on the issue at other levels of
government, but that the idea has not caught on.
Bob Sipkins stated that he thinks the Charter Commission has been unduly
criticized on this issue. He reiterated his comments from earlier meetings that he has not
Plymouth Charter Commission
September 30, 1996
Page 3
heard a compelling reason for the amendment. He said that this is nothing but a "feel
good" amendment, and that it is a political gesture. He sees no rationale for the
amendment, only political game playing. Mr. Sipkins said that the city council must find
a sound solution to taxes, not a simplistic one.
Bill Pribble asked Kathy Lueckert how much of the tax dollar would the
supermajority requirement control.
Kathy Lueckert stated that approximately 12 to 13 cents (the city portion only) of
each tax dollar would be controlled by the supermajority requirement.
Bill Pribble moved, seconded by Ellie Singer, that the letter received from
Mons Tieg, PhD, be made part of the permanent record of the Charter Commission.
The motion carried.
Virgil Schneider asked Bill Pribble to explain his proposed alternatives.
Bill Pribble stated that under the first of his alternatives, a supermajority
requirement could not block a simple majority from raising the tax rate if certain
conditions occurred, such as massive :toss of state aid or a decrease in the city's tax base.
Under his proposal, the majority on the council would have to raise the tax rate. He said
that his proposed language is not permissive. Bill Pribble said his second option is
modeled after Fridley's charter requirement. Bill Pribble stated that he doesn't like
supermajority requirements, and that in the corporate world supermajority requirement
often are used deleteriously by a hostile minority.
Bill Pribble moved, seconded by Ty Bujold, that the Plymouth Charter
commission rejects the charter amendment proposed by the Plymouth City Council
which would require a supermajority vote of the City Council to approve a tax rate
increase.
Kathy Lueckert clarified that the Charter Commission has the option of rejecting
the proposal, or offering its own language to the City Council. The City Council can then
choose to place the original language on the ballot, or the alternative language proposed
by the Charter Commission.
Virgil Schneider called for discussion of the motion.
Tim Peterson said that a special election would run counter to the council's desire
to get the most people to vote.
91
Plymouth Charter Commission
September 30, 1996
Page 4
Virgil Schneider said that the city's budget always has been adopted by more than
a supermajority vote. He feels it is ludicrous to spend money for a special election when
there is no identified problem with the way the tax rate has been set from year to year.
Jon Speck agreed that there is no evidence of any problem, and he said that there
must be some other reason for the issue coming up at this time.
Ty Bujold said that the Charter Commission has been around for five years, and
that the Commission has insights into the Charter. He said that he believes that the
Commission has an obligation to state its position more completely, articulating the
reasons why the amendment was rejected.
Virgil Schneider said that stating the reasons would be appropriate, and that the
Commission owes that to the City Council and to citizens.
Sandy Patterson agreed that it is important to state the reasons.
Bob Sipkins stated that in five months he has not heard one commissioner speak
in favor of the proposed supermajority requirement. However, he is concerned that the
commission may be "sticking its head in the ground" politically. He said that perhaps the
commission should not reject the proposal outright. He stated that he could support the
third option.
Virgil Schneider agreed with Mr. Sipkins. He said that the commission may be
philosophically correct, but wrong from a practical viewpoint.
John Duntley said that it does not bother him if the council puts the proposed
amendment on the ballot. He would rather say as a commission member that he sees no
compelling reason to approve it. He feels that the public will be misled by the
amendment, and that it does not provide additional protection.
Tim Peterson asked about option 3. Bob Sipkins stated the option 3 would allow
each city council to decide whether or not it wants to be governed by the supermajority
requirement, but would not place that requirement in the charter.
Virgil Schneider stated that if the proposed amendment is adopted and there is a
small voter turnout, then the amendment would be in the charter. It would be extremely
difficult to ever remove it from the charter.
Ellie Singer said that she agreed with Virgil Schneider. She said that it appears
that all charter commission members are opposed to the supermajority requirement. She
stated that option 3 would place the burden on the council. She said that she is more
amenable to option 3.
UO
Plymouth Charter Commission
September 30, 1996
Page 5
Ty Bujold said that the city council clearly wants option 1. Whatever the Charter
Commission does is irrelevant to what the council ultimately will do.
Tim Peterson said that the commission should give the council an alternative, and
not make it a black and white issue.
Bob Sipkins said that he would prefer to have something on the ballot on which
both the council and the commission agree. He fears that a "white paper" stating the
commission's position might go over the heads of most people.
Virgil Schneider said that it does not appear that the public really cares about this
issue. He has not had a single call on the issue.
Vote on the Motion. Motion carried, six ayes, five nays.
Commissioners Milner, Duntley, Patterson, Bujold, Speck and Pribble voting aye.
Commissioners Peterson, Sipkins, Singer, Bobra, and Schneider voting nay.
Virgil Schneider stated that he is opposed to the motion. He is fearful that the city
council will put the issue to the voters, and there will be a small turnout because of the
lack of knowledge or interest on the part of the electorate. He feels it would pass, and
that it would be hard to remove the supermajority requirement from the charter. He does
not feel that the requirement should be in the charter.
John Duntley said that perhaps the Charter Commission could reject the proposal
from the council, but suggest that if the council wants to have some kind of supermajority
requirement that option 3 would be a good choice. He still feels that there is no
compelling reason to approve the proposal, and that the case for it has not been proved.
Virgil Schneider said that he would consider a new motion which might
encompass alternative language if any commission members on the prevailing side would
vote to reconsider the motion. No commissioners on the prevailing side offered a motion
for reconsideration.
General discussion followed about the reasons for rejecting the proposed
amendment.
Bill Pribble said there can be no politics in charter discussions, but that political
reasons are driving the proposal from the council.
Tim Peterson said that while he against the council proposal, he feels the Charter
Commission has not discussed other options very completely.
t 93
Plymouth Charter Commission
September 30, 1996
Page 6
Ty Bujold said that the government isn't broken, and thus no amendment is
needed to fix it.
Ellie Singer said that she voted against the motion because she did not want to
reject the proposal without reasons.
Kapila Bobra stated that she has heard from other citizens that it appears that the
city council and charter commission are fighting.
Ty Bujold moved, seconded by Bill Pribble:
The Plymouth Charter Commission hereby gives its reasons for rejecting the
proposed charter amendment requiring a supermajority vote for a tax rate increase:
1. There has been no public support for the concept of a supermajority requirement
for the increase of a tax rate.
2. A supermajority rule does not represent good government as it relates to issues of
taxation. We endorse the principle of majority rule when it comes to fiscal
responsibility.
3. As a matter of constitutional law, we do not believe that future councils should be
bound by a supermajority voting requirement on fiscal matters. Such issues should
be resolved by traditional democratic procedures, at the heart of which is the
majority rule.
4. Expert testimony presented to the City Charter Commission has not supported
the idea of a supermajority requirement. The contrary has been true.
5. In the two year process of drafting the City Charter, this Commission considered
and rejected the supermajority concept as it related to taxation.
6. The Charter Commission is irrevocably opposed to the concept of the "tyranny of
the minority." Issues relating to taxation ought to be controlled by the majority.
7. The Charter Commission is not opposed to future reconsideration of the
supermajority requirement if valid evidence in support of the concept is presented.
8. The supermajority requirement does not exist in the form proposed in any other
Minnesota city charter.
Vote on the motion: ten ayes, one nay. Motion carries.
11
Plymouth Charter Commission
September 30, 1996
Page 7
Commissioners Bujold, Speck, Pribble, Schneider, Bobra, Milner, Patterson,
Duntley, Singer, and Sipkins vote aye.
Commissioner Peterson votes nay.
Tim Peterson stated that he takes exception to Councilmember Tim Wold's
comments at the September 10 Special City Council meeting. On page 4 Councilmember
Wold stated that "no one on the Charter Commission could make a decision" and that the
Charter Commission was "irresponsible." He said that he was very disappointed with
these comments.
Tim Peterson moved, seconded by Ty Bujold, that the Charter Commission
takes exception to comments about the Charter Commission made by
Councilmember Tim Wold on September 10, and that the Charter Commission
believes the comments were inappropriate.
The motion carried unanimously.
Virgil Schneider moved, seconded by Bill Pribble, that the Plymouth Charter
Commission directs staff to forward to the City Council the September 30, 1996
minutes and motions approving the actions and decision of the Charter Commission
as soon as these are ready.
The motion carried unanimously.
Ty Bujold moved, seconded by Bill Pribble, that unless an annual meeting of
the Charter Commission is required by law, that the Charter Commission cancel the
scheduled December meeting, authorize the chair to prepare the annual report, and
that the chair may call a meeting if he deems it necessary.
The motion carried unanimously.
Bill Pribble announced that he is resigning from the Charter Commission,
effective November 1, 1996 because he is moving from Plymouth. He stated that he had
enjoyed his work with the Charter Commission very much, and that the Commission had
always debated issues logically and thoughtfully. Commission members expressed their
thanks to Bill Pribble for his work.
Virgil Schneider adjourned the meeting at 8:40 p.m.
IV
f5o
Regular Council Meeting
October 2, 1996
Page 20
Finance Director Hahn said the permit fees are currently up, but the trend for
the future will be decreased permit revenues. He said there will be some
replacement type permits and staff levels will not continue to increase. Staff
is looking at alternatives to replace those revenue sources.
Councilmember Anderson asked the future Council to keep in mind that
building permit revenue sources will be declining and future planning is
needed.
Motion was made by Mayor Tierney, seconded by Councilmember
Lymangood, to accept the Financial Trend Report for the calendar year 1995.
Motion carried, seven ayes.
Item 9-A Consider Report from Charter Commission and Special Election Options
Robert Sipkins, 2621 Comstock Lane, member of the Plymouth Charter
Commission addressed the Council. He was designated by the Charter
Commission to appear on its behalf and to provide the final report on the
proposed charter amendment relating to the super -majority vote issue. He
read from the September 30 minutes of the Charter Commission: "Motion by
Bill Pribble, seconded by Ty Bujold: The Plymouth Charter Commission
rejects the charter amendment proposed by the Plymouth City Council which
would require a super -majority vote of the City Council to approve a tax rate
increase. The motion carried on a 6 to 5 vote. Commissioners Bujold,
Pribble, Milner, Patterson, Speck, Duntley voted aye. Commissioners
Peterson, Sipkins, Singer, Bobra, Schneider voted nay."
He said the Commission further acted: "Motion by Ty Bujold, seconded by
Bill Pribble: The Plymouth Charter Commission hereby gives its reasons for
rejecting the proposed charter amendment requiring a super -majority vote for
a tax rate increase:
1. There has been no public support for the concept of a
supermajority requirement for the increase of a tax rate.
2. A super -majority rule does not represent good government as it
relates to issues of taxation. We endorse the principle of majority
rule when it comes to fiscal responsibility.
3. As a matter of constitutional law, we do not believe that future
councils should be bound by a super -majority voting requirement
on fiscal matters. Such issues should be resolved by traditional
democratic procedures, at the heart of which is the majority rule.
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Regular Council Meeting
October 2, 1996
Page 21
4. Expert testimony presented to the City Charter Commission has
not supported the idea of a supermajority requirement. The
contrary has been true.
5. In the two year process of drafting the City Charter, this
Commission considered and rejected the supermajority concept as
it related to taxation.
6. The Charter Commission is irrevocably opposed to the concept of
the `tyranny of the minority.' Issues relating to taxation ought to
be controlled by the majority.
7. The Charter Commission is not opposed to future reconsideration
of the super -majority requirement if valid evidence in support of
the concept is presented..
8. The supermajority requirement does not exist in the form proposed
in any other Minnesota city charter.
The motion carried. Commissioners Bujold, Speck, Pribble, Schneider,
Bobra, Milner, Patterson, Duntley, Singer, Sipkins voted aye. Commissioner
Peterson voted nay.
Mayor Tierney offered apologies to the Charter Commission and the City
Council, as she was out of town and unable to attend the September 30
meeting. She asked if there was discussion on the additional proposals that
were put before the Charter Commission by Commissioner Pribble.
Mr. Sipkins said there was some discussion of several options that
Commissioner Pribble had proposed. Also, there was discussion precipitated
by Mr. Sipkins before the 6 to 5 vote, of his intent to bring a motion to
endorse the third option which was an amendment that would simply enable
the City Council and future Councils to enact by ordinance a super -majority
requirement for tax levy increases. This was not voted on. He believed that
there this would have been in the interest of the Charter Commission, the City
Council, and the electorate that the Charter Commission and the City Council
seek some kind of consensus and agreement on what it would present to the
electorate.
Mayor Tierney asked if there was any discussion about what the Charter
Commission would do now on the issue.
Mr. Sipkins said there was no discussion about future action on the issue. He
said there certainly is the possibility of the Charter Commission meeting
again, depending on what the Council decides to do with respect to calling a
special election. That meeting may be called in the near future.
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Regular Council Meeting
October 2, 1996
Page 22
Councilmember Preus asked Mr. Sipkins to explain the rationale for first
voting against rejecting the charter proposal and then voting in favor of the
reasons to reject the proposal.
Mr. Sipkins said he can only speak for himself as to the reasons he voted nay
on the initial vote and aye on the second vote. He doesn't favor the general
issue of a super -majority vote, and he was the first Commission member to
make that position known some time ago. He believes that the four members
who voted "nay" on the initial vote, agreed with him. He said that in the five
months the issue has been discussed by the Charter Commission, there has not
been one commissioner who has been persuaded that the super -majority vote
as a concept in this proposed amendment is a good idea. He believes that the
four members voting with him were interested in a compromise,
notwithstanding the fact that they were opposed to the concept of a super -
majority. He said that if this Council or a future Council believes that they
should be.governed by a super -majority vote on taxation or other issues, they
should be free to set their own rules. It is his sense that other Charter
Commission members feel the same way.
Councilmember Lymangood said that Mr. Sipkins said last month at the
Charter Commission meeting that he would not have a problem with a given
Council setting super -majority restrictions on themselves. However, the
current Charter prevents the Council from doing that.
Mayor Tierney said that she was not present at the City Council meeting when
the issue was first discussed, but the super -majority issue was referred to the
Charter Commission by the City Council with scant debate and without real
consideration of the third option of adoption of an ordinance. She said the
issue referred to the Charter Commission was that the Council wanted the
issue to go in the City Charter - not the option to allow the City Council to
vote to set its own rules.
Councilmember Lymangood said that under state law when initiatives are
made by City Councils, the Council is required to state a specific language.
The Council went further and presented three options to the Charter
Commission for consideration. He was not asked for his view of those three
options during the Charter Commission public hearing. Discussion did not
occur until after the motion was made to table. He said that Mayor Tierney,
being a member of both bodies, could have pursued options for a compromise
at that time. That opportunity is no longer available. He expressed concern
about one commissioner's comment that "whatever the Charter Commission
does is irrelevant to what the Council ultimately will do." He spoke against
that as he would not have invested his time and endeavor to address this issue
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Regular Council Meeting
October 2, 1996
Page 23
if the Charter Commission's discussions were irrelevant. If the Charter
Commission had voted to recommend a different option to the Council, the
Council would now have the opportunity to choose between the options.
Because the Charter Commission rejected the language sent to them, the
Council does not have that option. It would have been very relevant had the
Charter Commission chosen a different option.
Mayor Tierney said this can be reconsidered by those on the Charter
Commission who voted against it and a different recommendation can be
made. She believes that a compromise is still possible. She said the Council
came down hard and the Charter Commission came down hard on opposite
sides, but a compromise is still possible.
Councilmember Lymangood said he never presented his comments as
coming down hard" and he does not appreciate that characterization of his
presentation.
Mayor Tierney said she was not making comment on his presentation. She
was referring to the option adopted by the Council and the response by the
Charter Commission. The harshest option was selected by the Council.
Councilmember Wold said the Mayor should not characterize the Council's
action as harsh.
Mayor Tierney said she is characterizing the firmness of the Council's action.
Of the three options voted on by the Council, the most firm option was to put
the language into the Charter. There was the less firm option to make it a
majority vote for the Council to select at some time.
Councilmember Wold said the Mayor made the comment that the Council
could give it back to the Charter Commission and allow them to reconsider it.
Mayor Tierney said that she hadn't made that comment. The City Council has
the option at this point to reconsider.
Councilmember Wold said the Council does not have that option now. The
Council can either take the Charter Commission's recommendation or adopt
what the City Council originally proposed to them. The Council must select
one option or the other. He asked the City Attorney to comment on the
timeframe in which the Council must take action.
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Regular Council Meeting
October 2, 1996
Page 24
Attorney Knutson responded that the statute does not specify a time limit
under which the Council must act after receiving the report from the Charter
Commission.
Mayor Tierney asked whether the Council can reconsider the initial vote.
Attorney Knutson said the only way the issue could be reconsidered is for the
City Council to start the process over and refer something to the Charter
Commission. He said that the Council cannot now select Option 1, 2, or 3.
The Council can only select Option 1 or start the process over.
Mr. Sipkins asked if the Council does not have an additional option of tabling
the matter and, in the spirit of additional cooperation, requesting that the
Charter Commission meet again to reconsider their position. It is his sense
that perhaps both bodies are moving closer to the middle and that a
compromise may be possible.
Attorney Knutson said that option would also be available. The Charter
Commission has until October 15 to report to the Council and, under Roberts
Rules of Order, has until the next Charter Commission meeting to reconsider
the issue provided that the Council takes no action on the report tonight.
Councilmember Lymangood said someone voting in the affirmative on the
Charter Commission would need to make the motion for reconsideration. The
motion could not be made by anyone voting in the negative.
Mayor Tierney favored continued work toward a compromise. She noted that
members were missing from the Charter Commission meeting on September
30.
Mr. Sipkins stated that Subd. 7 of the statute relating to charter amendments
enables an amendment to the Charter by ordinance. He recommended that
perhaps if the Commission is allowed to reconsider the issue, without the
Council taking action this evening, that may be another option. He believes
that the electorate is better served by reaching a compromise, especially when
the alternative is to spend $13,000 on a special election where the turnout
could be very slim.
Manager Johnson said that if the Charter Commission reconsiders the issue,
the Commission should clearly indicate in their recommendation whether they
are proceeding under subdivision 5 or subdivision 7 of the statute.
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Page 25
Councilmember Lymangood raised a point of order. It is his understanding
that this issue is proceeding under subdivision 5 which relates to amendments
proposed by the Council, and that subdivision 7 is unavailable to the Charter
Commission at this time.
Manager Johnson said that the Charter Commission can initiate a charter
amendment process under the statute at any time.
Attorney Knutson said that the procedures in subdivisions 5 and 7 are not
mutually exclusive. If the Charter Commission came forward with a
recommendation, the Council could proceed under either subdivision 5 or 7.
If the Charter Commission were to come forward with a recommendation, the
Council could operate under either subdivision.
Councilmember Anderson asked if it is correct that the Charter Commission
would likely find subdivision 7 more palatable than subdivision 5 because an
ordinance could be adopted by the Council versus an approval by the voters.
Mr. Sipkins said that all he is representing is that it behooves the Council and
Charter Commission to keep working toward a compromise that will be to the
benefit of the electorate and that enables this Council and future Councils to
use a super -majority if they so choose without it being a mandatory provision.
Councilmember Anderson agreed and said that is what he is trying to do. He
would like something back from the Charter Commission to work with, and
asked that this be relayed to the Charter Commission members.
Mr. Sipkins said he is pleased to hear that because some other comments in
the past have caused some of the fellow commissioners to take positions that
perhaps have been more harsh than they would be otherwise. He believes it is
unfortunate that this issue has become controversial and filled with
recriminations. He would like the Charter Commission to revisit the issue
once more to determine if a compromise is possible.
Councilmember Anderson said that this issue is one in which elected officials
are representing the interests of the voters. He has a concern when appointed
people decide for the will of the majority. The Councilmembers were elected
based upon a certain public stance that many Councilmembers took and on
many points that were pledged to the voters. He wants it to be clear to the
Charter Commission that the Council simply wants to follow through with
what the public has embodied in them as elected officials.
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Page 26
Mr. Sipkins appreciated that sentiment, but said the Charter Commission has
held several meetings at which the only individuals speaking in favor of the
proposal were members of the Council. He said that at a recent meeting, one
candidate running for City Council indicated that none of 300 to 400 people
she met during door -knocking cared about the issue. In addition to the fact
that the Commission does not believe there is a present problem, there does
not appear to be any public sentiment favoring the proposal other than among
six existing Councilmembers. He said that is perhaps a reason that it has
taken the Commission as long as it has to consider the issue. The
Commission has been looking for public support and expert testimony which
would indicate the proposal is good government. The Commission has not
found that to be the case.
Mayor Tierney added that the Charter Commission has been authorized by the
general public, and the Charter was adopted by the majority of the public.
There has been public involvement in the issue.
Councilmember Granath thanked Mr. Sipkins for his involvement in the issue.
He is disappointed and frustrated because the significant evidence that there is
public support for this is that Councilmembers were elected. This issue was
specifically injected in the last campaign by Councilmember Preus, who was
elected city-wide in a hotly contested race. He said that when the elected
people are taking a position and developing it through the electoral process, it
shows there is popular support. That doesn't mean it will necessarily be
popular enough to pass, but it means that we should find out. This fall would
have been a prime opportunity to do that in the general election. He noted that
in the Charter Commission minutes, Commissioner Schneider explained his
reasons for being opposed to the motion and then indicated he is fearful that
the City Council will put the question to the voters and there will be a small
turnout; however, he believes it would pass. Councilmember Granath said
that if Commissioner Schneider is accurate, then it indicates there may be
significant public support for the issue. He said that there can be reasonable
differences on whether this is a good or bad idea, but his frustration is that the
City has missed an opportunity to get the issue in front of the voters. He fully
respects the reasons behind the majority sentiment on the Charter Commission
opposing the concept, but said the paramount issue is that the voters should
have had an opportunity to directly vote on the issue this fall.
Motion was made by Councilmember Lymangood that the Plymouth City
Council disagrees with the Charter Commission findings 1-4 and 6-8 and
further be it resolved to adopt RESOLUTION 96-555 CALLING FOR AN
ELECTION ON A CHARTER AMENDMENT with an election date of
November 1998.
In.
Regular Council Meeting
October 2, 1996
Page 27
Councilmember Lymangood said he agrees with Item 5 in the Charter
Commission's findings, but disagrees with the other findings. He stated that
by placing the issue on the ballot in 1998, it will be considered by the most
voters possible. If the Charter Commission wishes to reconvene and make
another recommendation, they can do so. The City Council could then alter
its motion. He said the Charter Commission had opportunities to act, and the
City Council scheduled the item on its agenda following those meetings. He
favors compromise, but at some point the issue needs to be concluded. He
encouraged the Charter Commission to reconsider the issue if there is
sufficient energy to do so. The City Council would then have another option
to consider.
Mayor Tierney asked staff to clarify whether the Charter Commission has
opportunity after the October 15 deadline to consider this issue.
Manager Johnson responded that the Charter Commission must finish this
process initiated by the City Council by October 15. The Commission has
other options under state law to make charter amendment proposals to the
Council. He said that the Council's resolution calling for an election on the
issue could be amended or undone up until 45 days before the 1998 election
date.
Motion to amend was made by Councilmember Lymangood, seconded by
Councilmember Anderson, to add "unless further action on this item is taken
prior to 45 days before the election date."
Councilmember Preus expressed concern about the timing stated in the
amendment. He is unsure that anything can be done between 45 days and
perhaps six months before the election date. If the Charter Commission came
forward with a different proposal, and the proposal is to come from the City
Council, the process will have to be started over again. The alternative is if
the Charter Commission came forward with its own proposal, in which case
the City Council would have the option of dropping its proposal. He believes
that the Charter Commission has left the City Council in the difficult situation
of either doing what the Council proposed or doing nothing.
Councilmember Lymangood said the intent of his motion is that the Plymouth
City Council can take action on this issue again up until 45 days prior to the
November 1998 election.
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Regular Council Meeting
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Page 28
Councilmember Preus said that it needs to be understood that the City Council
is limited to leaving its question on the 1998 ballot or removing it completely,
absent a new proposal by the Charter Commission.
Manager Johnson said that the City Council would also reserve the right to
invoke another subdivision 5 charter amendment process at any time.
Attorney Knutson restated the amendment, that the City Council would have
to take action before 45 days of the next election, if the Council wanted to
remove the question from the ballot.
Councilmember Wold understood that the intent of the amendment is to
clarify that the Council could reconsider the issue. However, the Council
always has that option under Robert Rules and under state law up until 45
days before the election. He does not believe that the amendment
accomplishes anything new. He said the Council would give full and sincere
consideration to any proposals received between now and 45 days before the
next election. He understands the intent, but does not believe it is needed.
Vote on the amendment failed: Lymangood and Anderson ayes; Wold, Preus,
Black, Granath, and Tierney nays.
Councilmember Preus spoke in favor of the main motion. He expressed
disappointment in the manner in which the Charter Commission has addressed
this issue. He believes that Mr. Sipkins has taken reasonable positions and
would have allowed the Commission to come back to the Council with an
alternative. However, the issue cannot go on the November ballot, and the
Council is left with only the options of its own proposal or taking no action at
all. The Charter Commission was told on' many occasions what the deadlines
and options were. They knew that they could present an alternative and that if
they didn't, the Council was left with only its proposal. The Charter
Commission waited to table until it was too late to get the issue on the
November ballot, and then voted to reject the Council's proposal. All of the
findings given by the Charter Commission in rejecting the Council's proposal
were reasons that he discussed with the Charter Commission last July. He
questioned why the majority of the Charter Commission would decide to
delay for several months other than to prevent the voters from having an
opportunity to address the issue. While he appreciates that the Charter
Commission members disagree with the philosophy of the proposal or
whether it is good government, it seems that the Charter Commission majority
made a deliberate effort to prevent the entire issue from going to the voters
this November. Under the state law provision under which the City Council
proposed the charter amendment, the Charter Commission was to review it,
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Regular Council Meeting
October 2, 1996
Page 29
state whether they agree with it, and provide a response to the Council. He
believes that the Charter Commission majority made a decision early on and
then decided to deliberately postpone as long as they could. They went
beyond their responsibilities.
Councilmember Preus addressed the specific reasons cited by the Charter
Commission. He disagrees with the first reason that there has been no public
support for a concept of a super -majority requirement for an increase in the tax
rate. He has talked with many residents during campaigning. He
acknowledges that this is not an issue that people are actively promoting;
however, they support it and have indicated that it's exactly what is needed in
governments at all levels. It needs to be more difficult to raise taxes. In
response to the second finding, he said that an individual from the Citizens
Taxpayer Association at a Charter Commission meeting explained that
taxation has gone too far at most levels of government. This would help to
add another check to bring taxes back to where they should be. He said that
the City can take a proactive approach and demonstrate ideas for keeping
taxes in line. This could be adopted by other levels of government. He
believes that the Charter Commission's position on this is narrow and
shortsighted.
In response to the third finding, Councilmember Preus believes that majority
rule operates well on most items. However, it has failed on items relating to
taxation. He said the City of Plymouth has been quite good, but there is the
potential to get into the same rut as other levels of government. With respect
to the fourth finding, he stated that after reviewing the minutes of the Charter
Commission, he would not characterize the testimony given as "expert" any
more than members of the City Council. These were individuals with certain
political views, and he doesn't believe that political views qualify as expert
testimony. In response to the sixth finding, he didn't recall the phrase
tyranny of the minority" being used at the Charter Commission meetings and
viewed it as expressing a bit of paranoia. He said that in practical
circumstances the tax rate is reached through give and take among the
members, and ultimately a compromise. He does not believe that process
constitutes a "tyranny of the minority."
Councilmember Preus stated that he interprets the seventh reason given by the
Charter Commission as that they have rejected every argument made thus far
and that they will never reconsider this because there is nothing new to add.
He has some concern with leaving the door open to have this item go back to
the Charter Commission because the majority of the Commission has taken an
absolutely strong position that they think it is a bad idea and they will never
approve it. However, Mr. Sipkins has been extremely conciliatory.
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Regular Council Meeting
October 2, 1996
Page 30
Councilmember Preus takes that as a good gesture and he will always be
willing to consider any good positive alternative by the Charter Commission.
Councilmember Preus said his response to the eighth finding that the super -
majority requirement does not exist in the form proposed in any other
Minnesota city charter is that maybe it should be. He added that maybe it
should be imposed on other levels of government as well so that taxation can
be brought back in control. He is disappointed in how the majority of the
Charter Commission handled this issue. He believes that the Commission
exactly knew its views on this issue months ago and took an action
deliberately designed to prevent it from going to the voters. The role of the
Charter Commission was not to do this, but rather to consider the issue and
give its view on whether it was good or not, or to present an alternative.
Motion to amend was made by Councilmember Lymangood, seconded by
Councilmember Anderson, that the Plymouth City Council wholeheartedly
agrees with and publicly acknowledges the intellectual leadership that
Councilmember Preus just demonstrated through his comments and his
support of this concept from the beginning.
Mayor Tierney spoke against the motion. She said it is unfortunate that this
issue started in a way that polarized the City Council and the Charter
Commission. She would have liked the two bodies to work together. She
stated that Councilmembers brought this issue forward as a political issue
from the campaign platform at a time when she was not present. The issue
was not well discussed by the City Council.
Councilmember Lymangood made a point of order. He stated that
Councilmember Preus originally brought this item to the City Council on
May 1 when Mayor Tierney was present.
Mayor Tierney stated that the issue was brought up on May 1 as a future issue.
She said that Councilmember Preus was either unaware, or did not bring to the
Council's attention for discussion, that the Council could have one proposal
and the Charter Commission could present an alternative proposal. She does
not consider it being well versed or well prepared to suggest something to the
Council for a vote, especially a proposal that was firmly rejected by the
Charter Commission years ago. She said that this was taking two opposite
views and trying to bring a compromise. This is a philosophical issue, and
education on such a process takes time. She feels that either side can take
offense. She said the issue did not come to the Charter Commission as
friendly or conciliatory; therefore, she cannot support that Councilmember
Preus has done a good job on this. Mayor Tierney stated that when the
Council and City Attorney started looking at the issue, there were three
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Regular Council Meeting
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Page 31
proposals, and other alternatives were discussed by the Charter Commission.
There are probably additional alternatives. She said that the Council's single
proposal does not speak to the ability to compromise. She fails to see that the
Charter Commission is not doing its duty in trying to come to a compromise
or understanding on the issue. She said that to try to put this before the voters
as some important issue that needs to be addressed immediately does not
make sense. The City has a Aaa bond rating and the lowest tax rate of the 77
cities over 10,000 population in Minnesota. The majority vote has held solid
and true for the City of Plymouth, and there is no evidence that the super -
majority would do better. The evidence would suggest that putting something
as firm as the position adopted by the City Council could be a detriment in the
future. She said that to try to get two groups with chosen polarities to work
together in a compromise will take time, education, and desire to work
together. It is important to give due consideration to the interests of both
bodies. She is not convinced that veering from majority rule is always good.
She said that the phrase "tyranny of the minority" was used at the Charter
Commission meeting. She said that giving the minority the opportunity to
have the power through a super -majority vote requirement can undo the
democratic process. She questioned why a super -majority vote would be
required on this issue, rather than on all issues.
Councilmember Wold stated that the amendment is solid and clear, and he
will support it. He commended Councilmember Preus for moving forward,
considering the options, and bringing this option to the Council. He was sorry
to hear the Mayor say that an amendment proposed by the Council under state
law (charter amendment subdivision 5) was viewed by the Charter
Commission as being forceful. He doesn't understand why there would be a
divergence in the process established by state law. Councilmember Preus
selected a legitimate process as provided by state law to bring an issue
forward. Councilmember Wold is concerned that anytime the Council may
propose an amendment under this section of state law, the Charter
Commission will oppose it, view it as being hostile, or take all tactics to delay.
He said that if future Councils are going to follow this process, they should
allow 6 1/2 months because the Mayor has clearly indicated that the Charter
Commission will delay. He finds that disturbing.
Mayor Tierney said that she said nothing about delay. The Council
deliberately chose a date when she was out of town and wanted to put before
the voters the most restrictive of the options relating to the super -majority
requirement.
Councilmember Wold stated that Mayor Tierney has said on more than one
occasion that this process "got the gumption up" of the Charter Commission
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Regular Council Meeting
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Page 32
or that the process forces the issue on the Charter Commission. These
comments gave him the understanding that she believes it is a shifty sort of
deal. He said that Councilmember Preus looked at the options and selected a
mechanism for bringing the issue forward as provided by state law.
Mayor Tierney said that there will be no agreement on this and suggested
moving forward.
Motion to amend carried, six ayes; Tierney nay.
Councilmember Black supported the main motion. She is disappointed that
the issue will not be considered by the voters at this election because she is not
as tied to the 5/7 vote as she is to letting the voters decide the issue.
Unfortunately, it is too late to get the issue on this November election ballot.
While there will be a smaller number of voters in the 1998 election, it is the
best remaining option. She clarified that the comments made by
Councilmembers that there are "no other options" refers to the fact that the
issue cannot be brought before the largest number of voters until the year
2000.
Mr. Sipkins reminded the elected councilmembers that the members of the
Charter Commission are a wholly nonpolitical group. He has no idea of any
of their politics. Those who have sat on the Commission since it was formed
have diligently worked long hours, and are individuals that the City should be
proud of. Mr. Sipkins vehemently disagreed with the suggestion of
Councilmember Preus that the Commission either individually or collectively
intended to operate in a manner as to deprive the electorate on a vote on this
issue. He said that regardless of what future issue is sent to the Charter
Commission by the Council under subdivision 5, whether a super -majority or
other proposed amendment, that the Charter Commission will give it as full
deliberation as deemed necessary regardless of the timing because the
members see that as their charge by law. He does not believe there was an
intent to delay on this issue. If the Council remains as acrimonious as he has
heard this evening and as he had read in previous minutes, then he believes the
Charter Commission members are the unfortunate individuals who have been
pulled into this, who have done their best to remain out of the politics on this
issue, and who have received all of the criticism. He objects to that.
Councilmember Wold stated that his previous comments were based on what
Mayor Tierney had said. He appreciates hearing from Mr. Sipkins that
subdivision 5 is recognized by the Charter Commission, as he was concerned
about Mayor Tierney's comments that subdivision 5 was offensive to the
Charter Commission.
lot
Regular Council Meeting
October 2, 1996
Page 33
Mayor Tierney said that she had not made that comment.
Mr. Sipkins said that the Charter Commission is a non-political body and none
of the Charter Commission members, except perhaps Mayor Tierney, have
enjoyed being dragged into this political situation. He believes that the
Charter Commission members are worthy of the Council's and the electorate's
respect.
Councilmember Anderson said that the Council agrees that respect is due the
Charter Commission. However, the "ball was dropped" by the Charter
Commission and the issue cannot be placed on the November ballot.
Councilmember Anderson said that he was elected by a group of people who
pay taxes in the City, and they asked him to let them vote on the issue. He
said that the problem he has with the liberal form of government, such as the
President, is that they think they should make the decisions rather than let the
citizens make the decisions. Councilmember Anderson said he wanted the
Charter Commission to take a position on the issue, regardless of the position,
in order to get the issue before the largest number of voters in November. It
was an obligation of the Charter Commission and they chose not to exercise
that. He said that Councilmembers Wold, Black, and Preus ran for election
with a specific pledge that they would bring the super -majority tax issue to the
Council for a vote. They were elected by a large percentage of the population
and that validates what the Council is doing. He said that Ms. Johnson, the
local candidate who spoke before the Charter Commission, has not run for or
held political office. He said the Council is not trying to attack people; they
just want the voters to decide the issues.
Mr. Sipkins responded that Councilmembers Anderson and Granath have
indicated that public support for this is somehow expressed in the vote that
elected three members to this Council. He believes that the majority of people
who voted for them, including him, voted for them because the City was in
great need of an arena. He doesn't think the vote had much to do with the
super -majority issue because it was not their only issue. Since their
campaigns were inextricably tied with building an arena, it is disingenuous for
anyone to say that it creates evidence of strong public support, especially
when everything the Commission has seen at public meetings indicates that
the only individuals interested in the issue sit on the City Council.
Councilmember Granath stated that he fully respects the members of the
Charter Commission but disagrees with the way this occurred. He blames the
Charter Commission for it, but this has nothing to do with anyone's integrity.
Councilmember Granath said the discussion has centered on how much
of
Regular Council Meeting
October 2, 1996
Page 34
support is out there for the issue. Councilmembers believe the threshold only,
needs to be sufficient to let the voters decide on the issue. Had the Charter
Commission taken a position earlier, the issue could have gone to the voters in
November. Now the issue will not be resolved for some time. He believes
that this was a good opportunity to reach the largest number of voters and that
there is at least credible evidence to suggest that there is enough interest on the
issue to have an election.
Motion was made by Councilmember Lymangood, seconded by Councilmember
Anderson, to waive the 10:00 p.m. adjournment rule and extend the adjournment time to
10:20 p.m. Motion carried, seven ayes.
Councilmember Preus said that it was not his intent in any fashion to attack
the integrity, enthusiasm, or dedication of members of the Charter
Commission. He said that the Charter Commission knew the statute, the
issues, and the time frame. The majority of the Charter Commission chose to
table the issue, and the result is the issue is now prevented from going to the
voters in November. He is disappointed because it appeared quite clear that
some members if the Charter Commission tabled the issue with the sole
purpose of preventing it from going to the voters, instead of genuinely needing
more time to consider the issues. He said that the statute provides that the
Charter Commission reviews a proposed amendment and provides a
recommendation. The Charter Commission has done that, but they have also
done it in a fashion to take enough time so it cannot go to the voters.
Councilmember Preus said that he believes the comments about the issue
being acrimonious are only from the side of the Charter Commission. If there
are things that the City Council has done to cause them to come to that
conclusion, it is unfortunate. He doesn't believe that the Council views the
issue as acrimonious, rather Councilmembers are disappointed. He agreed
with Councilmember Anderson that the Charter Commission "dropped the
ball" so the issue could not be resolved in a timely fashion.
Mr. Sipkins said that the issue was referred to the Charter Commission rather
late. The Charter Commission only used the time that was allotted to it by
statute. If this issue was the core of the platform on which Councilmembers
ran, then it was incumbent on those members to get the issue to the Charter
Commission earlier.
Councilmember Preus said that under the statute, the City Council can
propose a charter amendment at any time. Just because the statute allows the
Charter Commission 60 days, with an additional possible 90 days, does not
mean that the entire time has to be used, especially on this relatively simple
110
Regular Council Meeting
October 2, 1996
Page 35
issue. The Charter Commission could have come back with the same amount
of information and the same recommendation in a more timely fashion.
Mr. Sipkins said the same thing could be true of the process if the issue had
been forwarded to the Charter Commission on July 15. While it is true that
the Council can take action at any time they choose, no action was taken until
May. He disagrees that the Charter Commission "dropped the ball" because it
could have been referred to the Charter Commission earlier.
Councilmember Anderson requested a roll call vote on the motion.
Councilmember Lymangood clarified that his motion does allow flexibility on
this issue in the future at the initiative of the Charter Commission. He said
that the intent of his motion is to allow time for the discussion to continue. He
noted that the Council could have set an election date on the issue which
would have prevented further consideration of the issue. He read the motion..
Motion carried: Preus, Granath, Black, Anderson, Wold, Lymangood, ayes;
Tierney nay.
Mayor Tierney stated she believes a compromise can be worked out. She
hopes that this can be accomplished before the 1998 election. As the Council
has been aware, there seems to be no urgency involved in the issue at all
because nothing is broken and nothing needs to be fixed. The hurry and
urgency is not an issue.
Motion was made by Councilmember Lymangood, seconded by
Councilmember Anderson, to move to the next agenda item. Motion carried,
seven ayes.
Item 9-B Committee and Commission Vacancies
Motion was made by Councilmember Wold, seconded by Councilmember
Anderson, to direct staff to advertise for committee and commission vacancies
beginning the week of October 14, 1996, as recommended by staff. Motion
carried, seven ayes.
I//
CITY OF PLYMOUTH
HENNEPIN COUNTY, MINNESOTA
RESOLUTION NO. 96-555
RESOLUTION CALLING FOR AN ELECTION
ON A CHARTER AMENDMENT
BE IT RESOLVED by the City Council of the City of Plymouth, Minnesota,
as follows:
1. The City Council has adopted an ordinance amending the Plymouth City
Charter, subject to voter approval, to provide as follows:
A two-thirds majority of all members of the
Council is required to adopt a tax levy
resolution that increases the City's tax rate over
the prior year. Tax rate means the quotient
derived by dividing the City's tax levy by the
City net tax capacity. "
2. The proposed Charter amendment was submitted to the Plymouth Charter
Commission. The Charter Commission has reviewed and rejected the
proposed Charter amendment and has reported its decision back to the City
Council.
3. The proposed Charter amendment shall be submitted to the voters of the
City of Plymouth. The form of the ballot attached hereto is approved. The
election shall be held between the hours of seven o'clock a.m. and eight
o'clock p.m. on the. 3rd day of November , 19 98
4. The City Clerk is hereby authorized and directed to post and publish
according to law a Notice of Election and Ballot, and to prepare ballots for
use at the election, provided the form of ballot shall have such changes as
are necessary to be in the form approved by the rules by the Secretary of
State.
5. The election shall be held and conducted in accordance with the statutes of
the State of Minnesota applicable, and the Council shall meet as required
by law for the purpose of canvassing said election and declaring the results
thereof.
42898
10/0110/01/96
1996.
ADOPTED by the City Council this day of
Joycelyn Tierney, Mayor
ATTEST:
Z
curie F. Ahrens, City Clerk
42898
10/01/96 11310/01
OFFICIAL ELECTION BALLOT
CITY OF PLYMOUTH
HENNE PIN COUNTY, MINNESOTA
YES "Shall the Plymouth City Charter be amended to provide that a two-
thirds majority of all members of the Council is required to adopt
a tax levy resolution that increases the City's tax rate over the prior
NO year. Tax rate means the quotient derived by dividing the City's tax
levy by the City net tax capacity?"
INSTRUCTIONS
Put an (X) in the square before the word "YES" if you desire to vote for the
question; or put an (X) in the square before the word "NO" if you desire to vote against
the question.
42897 liq
Plymouth Charter Commission
October 21, 1997
Present: Virgil Schneider, Larry Marofsky, Jon Speck, Dave Pauba, Mary McKee,
John Duntley, Joy Tierney, Lori Schwartz, Ellie Singer, Bob Sipkins,
Tim Peterson, Terry Donovan, Assistant City Manager Kathy Lueckert
Excused: Scott Martin
Absent: Kapila Bobra, Ty Bujold
Call to Order
Virgil Schneider called the meeting to order at 8:05. Charter Commission
members introduced themselves.
Discussion of Proposed Supermajority Vote Amendment
Virgil Schneider stated that the City Council has placed on the November 1998
ballot the proposed charter amendment on the requirement for a supermajority vote of the
city council for a tax rate increase. The Charter Commission held general discussion
about the proposed amendment. No one on the Charter Commission spoke in favor of the
proposed amendment. The Commission indicated its willingness to discuss with the City
Council other possible options for a supermajority vote requirement.
Terry Donovan moved, seconded by John Duntley:
BE IT RESOLVED that the Charter Commission of the City of Plymouth,
Minnesota, does hereby recommend that the Plymouth City Council repeal Ordinance 96-
9, an ordinance amending the City Charter concerning taxation, and Resolution 96-555, a
resolution calling for an election on a charter amendment; and
BE IT FURTHER RESOLVED that the Plymouth Charter Commission invites
the Plymouth City Council to a joint public meeting if the Plymouth City Council is
interested in further discussion of the issue of requiring a supermajority vote for a tax rate
increase.
Vote:
Ayes: Schneider, Speck, Marofsky, Pauba, McKee, Duntley, Tierney, Singer
Schwartz, Sipkins, Peterson, Donovan.
Nays: None.
Charter Commission Annual Meeting
Virgil Schneider moved, seconded by Larry Marofkky, that the Charter
Commission annual meeting be established on December 2, 1997 at 7 p.m. The
motion passed.
Other Issues
Larry Marofsky questioned Section 5.02, Subd. 1 of the Charter regarding
contributions. He questioned the use of the word "proceeding," and wondered if this
section is enforceable. He also questioned if this section prohibits a general contribution
to an agency (for example, a union), where the money could be used to promote or
oppose an initiative proposal, unknown to the donor. Larry Marofksy also stated his
concern about whether or not this section might violate free speech rights.
Joy Tierney moved, seconded by Ellie Singer, to refer this issue to the City Attorney.
The motion passed.
Ellie Singer moved, seconded by Virgil Schneider, to adjourn the meeting. The
motion passed, and the meeting adjourned at 8:05 p.m.
City of Plymouth
Charter Commission
October 21, 1997
BE IT RESOLVED that the Charter Commission of the City of Plymouth,
Minnesota, does hereby recommend that the Plymouth City Council repeal Ordinance 96-
9, an ordinance amending the City Charter concerning taxation, and Resolution 96-555, a
resolution calling for an election on a charter amendment; and
BE IT FURTHER RESOLVED that the Plymouth Charter Commission invites
the Plymouth City Council to a joint public meeting if the Plymouth City Council is
interested in further discussion of the issue of requiring a supermajority vote for a tax rate
increase.
Adopted by the Plymouth Charter Commission on October 21, 1997.
Vote:
Ayes: Schneider, Speck, Marofsky, Pauba, McKee, Duntley, Tierney, Singer
Schwartz, Sipkins, Peterson, Donovan.
Nays: None.
117
Adopted City Council Minutes
November 12, 1997
Page 5
fiber Johnson said that she will support the program with a maximum
on a one-year trial basis because it fits within the Council's goal to
City employees.
Councilmember Pr`Ni, asked if Health Partners would participate in the cost of the
program.
Assistant Manager Lueckert sal at Health Partners is not willing to contribute
funds toward the program, and HeaNILIplartners has been unsuccessful in obtaining a
corporate membership with LifeTime Fhoqess.
MOTION was made by Councilmember Johnsols, econded by Council Spigner, to
direct staff to prepare an agenda item for Council co ideration to approve the
proposed Employee Fitness Program, with a first-year 000 cap, a one-year trial
period to be communicated to employees, and with establish tandards to be met
after the one-year period. Motion carried, six ayes.
Charter Issues
Assistant City Manager Lueckert explained that during 1996, the Plymouth Charter
Commission and City Council discussed the merits of requiring a supermajority vote
5/7) of the City Council for a tax rate increase. In May 1996 the City Council
adopted Ordinance 96-9 requiring a supermajority vote. The Charter Commission
reviewed the proposed amendment and did not recommend its adoption and
incorporation into the charter. In October 1996, the City Council adopted Resolution
96-555 which places the supermajority amendment on the ballot in November 1998.
She stated that at its October 21, 1997, meeting, the Charter Commission affirmed its
opposition to the amendment in its current form. The Charter Commission adopted a
resolution recommending that the City Council repeal Ordinance 96-9 and Resolution
96-555. In the same resolution, the Charter Commission indicated its willingness to
discuss with the City Council at a joint meeting other options for a supermajority
requirement should the Council be interested in such discussions. The Charter
Commission has invited the City Council to meet with them at their annual meeting
on December 2, 1997.
Mayor Tierney verified that the Charter Commission does not support the
supermajority vote requirement for a tax rate increase. She encouraged the City
Council to meet with the Charter Commission to discuss the issue, and noted that
there are several new Councilmembers and Charter Commission members since this
issue was addressed. She said that in the fall of 1996, the City Council was prepared
to back away from the requirement, but made no subsequent change.
it
Adopted City Council Minutes
November 12, 1997
Page 6
Councilmember Johnson asked the City Attorney to comment on what would occur if
the Charter Commission proposed an alternate question for the 1998 ballot. She
believes it would be preferable to have one question go to the voters.
Attorney Knutson said that the two questions would both be placed on the ballot.
There could be a problem if the questions are contradictory and both are adopted.
Councilmember Preus said that the City Council considered all possible options in
1996 and decided to put the supermajority question forward to the voters in 1998. He
said it is not true that the City Council was unsure about the amendment a year ago,
as stated by the Mayor. He sees no reason to go through the discussion process again.
The Charter Commission can proceed as they see fit.
Mayor Tierney said that in the fall of 1996, she received a phone call from (former)
Councilmember Lymangood indicating that the Council was establishing a special
meeting to discuss other options. She believes there was a move by the City Council
to rescind its action because there was discussion of calling a Charter Commission
meeting if the Council was willing to reconsider the issue. However, the Council
made no change. Mayor Tierney said the Council can either repeal the ordinance or
meet with the Charter Commission to discuss the issue further.
Councilmember Spigner said the Council has a third option to take no action and
allow the question to be voted on the November 1998 ballot.
Mayor Tierney said that there are times when the Charter Commission may not be
acting in a way that the City Council would like, but that is why she suggests a joint
meeting. She believes that a supermajority vote requirement.could negatively impact
the City's bond rating, and that the City Council is forcing the issue.
Motion was made by Councilmember Johnson, seconded by Councilmember Spigner,
to meet with the Charter Commission on December 2 for discussion of the
supermajority vote issue if the meeting is televised and open to the public.
Councilmember Johnson said, as a new Councilmember, she would be interested in
participating in a discussion on the issue. If the issue is put before the voters, she
would like to have input.
Councilmember Spigner said that she does not want to take away anyone's right to
vote on the issue. She believes the issue should remain on the 1998 ballot for a
decision by the voters.
1i9
Adopted City Council Minutes
November 12, 1997
Page 7
Councilmember Preus said it is unfair to say that the City Council is forcing this
issue. It is up to the voters to approve or deny it. He believes that a meeting with the
City Council and Charter Commission will result in a lengthy debate.
Mayor Tierney said that she will have a major concern if the Charter Commission
proposes another question for the ballot.
Councilmember Spigner asked if Mayor Tierney was speaking as a City Council or
Charter Commission member.
Mayor Tierney responded, "both".
Councilmember Black asked why the Charter Commission would want to propose a
question if it will put the City in a situation of having two conflicting questions on the
ballot. The City Council gave the Charter Commission an opportunity to act with
them. Now the Charter Commission is considering placing alternate language on the
ballot because they don't like the action taken by the Council.
Assistant Manager Lueckert stated that the Charter Commission has taken no official
action to place anything on the ballot.
Councilmember Johnson said she values the opinion of the Charter Commission, and
she would like an opportunity to participate in the discussion. .
Mayor Tierney said the Charter Commission would like the opinion of this City
Council on the ballot language.
Manager Johnson said there are three new Councilmembers and five new Charter
Commission members since the issue was addressed in 1996. In addition, the State
has completely rewritten the tax laws.
Councilmember Preus said he would be unable to attend the December 2 meeting. He
supports Councilmember Johnson's intent, but won't support the motion because of
the comments made by the Mayor.
Councilmember Johnson reminded the Council that the request for a joint meeting
came from the Charter Commission. The Charter Commission would like to know
how this Council feels about the proposed amendment. She said there is a potential
of two competing ballot questions, and she believes that dialogue could resolve the
issue. She asked the City Attorney to comment.
Attorney Knutson responded that one ballot question could require a 5/7 vote and
another a different percentage vote, and both questions could pass.
Igo
Adopted City Council Minutes
November 12, 1997
Page 8
Mayor Tierney said there is no case law on what happens if two conflicting Charter
amendments pass.
Councilmember Preus asked Attorney Knutson to speak further to the issue.
Motion was made by Councilmember Bildsoe, seconded by Councilmember Johnson,
to call the question. Motion failed: Johnson, Bildsoe, and Spigner ayes; Black, Preus
and Tierney nays.
Chuck Lymangood addressed the Council. He said the Mayor's characterizations of
what occurred last fall are false. There was no movement on the part of the Council
to soften the proposed amendment. He suggested that someone should ask the City
Attorney to respond to the question asked by Councilmember Preus of which
language would prevail if two conflicting ballot questions are adopted.
Mayor Tierney said that former Councilmember Lymangood had informed her that a
different motion was being considered to address the supermajority vote issue and
asked whether the Charter Commission would meet. She said that this left her with
the impression that the question for the ballot may change from the one initially
proposed by the Council. She asked Attorney Knutson to comment on which
language would prevail if two conflicting ballot questions are adopted.
Attorney Knutson said that he is unsure that the most restrictive would apply and
further research is needed. He is aware of no court decisions on this issue.
Mayor Tierney expressed concern about dueling amendments that could get tied up in
the courts.
Councilmember Black said that she has not changed her opinion on this issue. She
feels there is no need to meet with the Charter Commission. When the amendment
appears on the 1998 ballot, she may vote against it, but she believes that the voters
have a right to vote on the issue. She is hopeful that there will be good debate on the
issue prior to the election, including a League of Women Voter forum, so that voters
can make an informed decision. She encouraged other Councilmembers to meet with
the Charter Commission if they wish to do so.
Councilmember Spigner said that individual members can attend the meeting, but she
does not wish to accept the invitation to meet as a full Council.
Councilmember Johnson suggested that the City Council could also hold a study
session with former Councilmembers in attendance to discuss the merits of the
proposal.
1k)
Adopted City Council Minutes
November 12, 1997
Page 9
Councilmember Preus supported a study session, but would not want it to interfere
with other priorities of the City. He suggested the study session be held during the
first quarter 1998.
Mayor Tierney said it should be held as early in January as possible.
Councilmember Preus asked the City Attorney to comment on the Mayor's status
when attending a Charter Commission meeting.
Attorney Knutson said the conservative answer is that she is there in both capacities.
Councilmember Johnson withdrew her motion.
Motion was made by Councilmember Johnson, seconded by Councilmember Spigner,
that the City Council discuss with former Councilmembers the supermajority vote
issue in a study session the first quarter 1998.
Councilmember Spigner noted that if individual Councilmembers wished to attend
the December 2 Charter Commission meeting they were free to do so, but not as
representatives of the entire Council.
Motion carried; six ayes.
Sto n/Speed Humps Policy
is Works Director Moore presented the staff report on an "All -Way" Stop Sign
Polic taff believes there is merit is considering the City of Lakeville Policy.
MOTION was a by Councilmember Preus, seconded by Councilmember
Johnson, to direct sta conduct the analysis on a recommendation for an "All -
Way" stop for Zircon Lane, lley Forge Lane, and the Cottonwood/47`'' intersection
using the criteria established in tity of Lakeville policy.
1.
Councilmember Bildsoe said that the Lakevi olicy is a good place to start. The
policy is objective, yet takes many variables into a unt.
Motion carried, six ayes.
Mayor Tierney said that if the City is going to use speed humps, then a Council
should adopt a policy for their placement.
lkx
UNAPPROVED MINUTES
Plymouth Charter Commission
December 2, 1997
Minutes
Present: Virgil Schneider, John Duntley, Jon Speck, Terry Donovan, Lori Schwartz,
Bob Sipkins, Ellie Singer, Joy Tierney, Mary McKee, Kapila Bobra, Ty
Bujold, Larry Marofsky
Excused: Tim Peterson, Dave Pauba, Scott Martin
Others: Councilmember Judy Johnson, Chuck Lymangood, Assistant City Manager
Kathy Lueckert
Call to Order
Virgil Schneider called the meeting to order at 7:04 PM.
Approval of Minutes
Mary McKee moved approval of the minutes of the October 21, 1997 Charter
Commission meeting. Ellie Singer seconded the motion. The motion passed.
Discussion of Proposed Supermajority Amendment
Assistant Manager Lueckert presented a brief staff report. She said that the City Council
had discussed the October 21 Charter Commission resolution, but had declined to take
any action to rescind or repeal ordinances pertaining to the proposed supermajority
amendment. Ms. Lueckert stated that the City Council had discussed coming to this
meeting, but also did not take any official action. The City Council did vote to place a
discussion of the supermajority issue on the agenda for a future council study session,
most likely in February. She then called the attention of the Charter Commission to the
opinion of City Attorney Roger Knutson on the implications of having two similar
proposals (one from the council and one from the Charter Commission) on the same
ballot. Mr. Knutson opines that if both proposals passed, the two would have to be
harmonized somehow. If the two are contradictory and both are approved by voters,
Minnesota state statutes do not provide guidance on how to resolve the conflict. To avoid
this, the ballot should contain language instructing voters to vote for one or the other, but
not both, or to consider the proposals at two separate elections. In the latter case, the
most recently passed amendment would prevail. Ms. Lueckert stated her
recommendation that the Charter Commission not put its own version of the
supermajority amendment on the ballot.
Kapila Bobra stated that she is still interested in some kind of compromise language so
that both the City Council and the Charter Commission look good to voters. However,
she has not changed her opinion of the merits of the supermajority vote issue.
03
Plymouth Charter Commission
December 2, 1997
Page 2
Joy Tierney stated that she has passed out information, including her own letter to the
Charter Commission and City Council as well as her notes on the September 20, 1996
City Council meeting, and an article pertaining to applying the principles of Sun Tzu to
city management. Ms. Tierney said that the Charter Commission can present its own
language on the supermajority issue to the voters. Ms. Tierney indicated that she has
directed city staff to place on the next council agenda a resolution which would direct
notification of the charter commission any time a charter issue is scheduled on a city
council agenda. Ms. Tierney presented some of her views of the recent history of the
supermajority issue. She described in more detail the information she had passed out to
the Charter Commission. She said that her desire is to not have two provisions or
amendments on the ballot.
Terry Donovan asked if the City Council had taken any action on the Charter
Commission's resolution.
Kathy Lueckert said that the council had not.
Judy Johnson said that the City Council will discuss the issue again at a February study
session. Ms. Johnson stated that she will take forward to the City Council any new
proposals for language from the Charter Commission. She is concerned that the new
members on both bodies need time to study the issue. Ms. Johnson does not want to
repeat the recent past, and she wants both bodies to work together with open dialog and
new ideas and thoughts.
Virgil Schneider thanked Ms. Johnson for attending the meeting.
Terry Donovan said that he is waiting for the City Council to respond to the Charter
Commission's October resolution. He wants the Council to take action, one way or
another.
Ellie Singer stated that she is disappointed with the City Council study session. She said
she has not heard what the City Council's viewpoint is, and has not heard why the
Council thinks the supermajority vote is a good idea. She said she would like the Council
to debate why the proposed amendment should or should not be in the charter.
Larry Marofsky asked what the legal deadline was for getting an issue on the ballot.
Ms. Lueckert responded that the legal deadline is 45 days prior to the election; however,
the practical deadline is closer to 60 days.
Larry Marofsky said that there is time to further consider the issue.
laq 0
Plymouth Charter Commission
December 2, 1997
Page 3
Ty Bujold stated that the Charter Commission did more than just debate the issue, that it
sought out outside opinions. He hopes that the City Council is engaging in the same
process. He stated that he is concerned about the Charter Commission negotiating with
the City Council. He still believes that the supermajority requirement is not a good idea.
Mr. Bujold stated that he does not believe it is the Charter Commission's obligation to
compromise, that the commission considered the proposed amendment and rejected it.
Joy Tierney stated that nothing was decided by the City Council on November 12. The
situation is status quo.
Larry Marofsky said that he has a problem with the concept of compromise, and that he
doesn't see the other alternatives as any more viable or valuable. He does not want a
conflict with the City Council. He does not want two amendments on the ballot, and
feels that the focus should be on voter education on the issue. The City Council will have
to live with the amendment if it passes, but it could be changed later—even to a
unanimous requirement.
Larry Marofsky moved, seconded by Ellie Singer, that the Charter Commission of
Plymouth, Minnesota requests that the Plymouth City Council consider the October
21, 1997 Charter Commission resolution recommending repeal of the City Council's
actions placing the supermajority vote requirement on the ballot at a regular
meeting of the City Council.
Judy Johnson stated that any councilmember could place this request on the agenda, but
she had hoped that a different proposal could come up at the February study session.
Larry Marofsky suggested that the charter commission resolution be considered by the
city council by April 1, so that the council would affirm or deny the Charter
Commission's request to rescind the actions.
Virgil Schneider said that the Charter Commission should hold a public hearing on the
issue, and invite the public to come and comment on the supermajority proposal. The
Council could then vote the idea up or down.
Larry Marofsky stated he would amend his motion to ask that the City Council consider
the resolution at a regular council meeting, and to hold a public hearing on the Charter
Commission resolution by April 1, 1998. Ellie Singer, as the seconder of the motion, was
amenable to the amendment.
Kapila Bobra stated that the same experts should be invited to speak at this hearing, from
the Minnesota Taxpayers Association and the League of Minnesota Cities. The hearing
should provide education to the public.
ISS J
Plymouth Charter Commission
December 2, 1997
Page 4
Virgil Schneider said that it is not the Charter Commission's place to tell the City
Council who to invite.
Ellie Singer said that the Charter Commission can't tell the Council to hold a hearing.
Judy Johnson said that those on the council who do not favor the amendment are in the
minority.
Ellie Singer stated that the Charter Commission should be allowed to educate the City
Council and the public on the supermajority issue.
Bob Sipkins said that he did not understand the point of the public hearing, and that it
was clear from the November 12 council minutes where councilmembers stood on the
issue. He stated that he feared that the Charter Commission was going about this in the
wrong way, and that the experiences of last year would be repeated. The decision by the
Charter Commission should be based upon the collective belief of the body that the
supermajority amendment should be opposed or that the commission is interested in
compromise, and then proceed accordingly. He said that he does not sense interest in
compromise on the part of the Charter Commission.
Larry Marofsky said that he doesn't know if the council is interested in compromise, but
that he is basing his opinion on the information available. He said that his motion is one
last shot at preventing friction, but he could be persuaded otherwise.
Bob Sipkins said that the council minutes indicate to him that the council wants the issue
on the ballot for voters to decide, even though individual council members may not vote
in favor of the issue. If the council has its amendment and the charter commission also
places an amendment on the ballot, only the lawyers win. If there is no room for
compromise between the council and the commission, then that fact should be accepted.
Lori Schwartz asked if there were some action the council could take short of rescission
of the proposed amendment.
Bob Sipkins said that it is his feeling that the council wants the issue before the voters.
Some compromise may have be possible on Alternative 3 for the supermajority
requirement, which was somewhat better than Alternative 1 in his opinion.
Judy Johnson asked if the council had considered other alternatives as a compromise.
Chuck Lymangood attempted to gain recognition from the chairman to speak.
114
Plymouth Charter Commission
December 2, 1997
Page 5
Terry Donovan said that sufficient information was available, and that he didn't see a
need for visitors to speak.
Virgil Schneider stated that he does not want to discuss past history, and that he wants to
go forward.
Judy Johnson said that compromise with the council may be possible.
Virgil Schneider said that the Charter Commission was not approached in the last year
with a compromise proposal from the City Council.
Judy Johnson said that she is willing to compromise now. Six of seven councilmembers
were in favor of the supermajority amendment last year, but that may not be the case with
this city council.
Mary McKee said that the November 12 minutes do not reflect people willing to
compromise.
Judy Johnson said that she made a motion to have the entire city council come to this
meeting, but later withdrew it because she did not think she had support. She said she
then made a motion to discuss the charter issue at a council study session after the first of
the year.
Joy Tierney said that there were not enough votes to repeal the proposed amendment.
She said that she believes that some on the council were interested in compromise in
September 1997.
Chuck Lymangood asked if all information given out at the meeting was available to the
public.
Terry Donovan asked what was the timeline for guests to speak.
Virgil Schneider said there is no set timeline. He called on Chuck Lymangood to speak.
Chuck Lymangood said that he is concerned about Open Meeting Law requirements,
which state that all information given out at a meeting must be available to the public.
He said that he has the agenda materials, but he does not have the information distributed
by Mayor Tierney.
Kathy Lueckert stated that Mayor Tierney brought this information to the meeting
tonight.
lad
Plymouth Charter Commission
December 2, 1997
Page 6
Chuck Lymangood said that the September 20, 1996 city council meeting was called
because it was the last possible chance to meet legal deadlines to place the supermajority
issue on the November 1996 ballot. The City Council was anticipating a report from the
Charter Commission by that date. If the Charter Commission report had come in, and
had suggested a compromise, that compromise could have gone on the ballot.
Virgil Schneider spoke to the motion, and said that it seems like the council has a long
time to get the issue on the agenda.
Larry Marofsky said that if the study session is in February, this gives more time to get
the issue on a regular agenda.
Judy Johnson said that she wanted to discuss charter issues in January, but could get four
votes only for a February discussion. She said she hoped that the City Council would
meet with the Charter Commission. She is willing to take other ideas forward. She is
worried about the issue becoming political, and she would rather work out differences
beforehand.
Joy Tierney said that public testimony can be taken at a regular meeting.
Virgil Schneider said that the public would be allowed to speak at a public hearing, but
this is not always the case with regular agenda items.
Larry Marofsky said that at a public hearing, everyone hears the same thing. He said his
motion does not draw a line in the sand, and that compromise is still possible.
Judy Johnson said that alternatives could be suggested at a public hearing.
Larry Marofsky said that he would not propose a compromise without a meeting, but
recommendations may come up during the course of the meeting. He wants to avoid ugly
situations.
Virgil Schneider asked if there were further questions on the motion.
Ty Bujold, seconded by Lori Schwartz, moved to call the question.
The motion to call the question was approved, John Duntley voting no.
Virgil Schneider asked Kathy Lueckert to read the motion:
Motion by Larry Marofsky, seconded by Ellie Singer:
611
Plymouth Charter Commission
December 2, 1997
Page 7
The Charter Commission requests that the Plymouth City Council consider the
October 21, 1997 Charter Commission resolution recommending repeal of
Ordinance 96-9 and Resolution 96-555 at a regular meeting of the City Council; and
that the Charter Commission requests that the City Council hold a public hearing
by April 1, 1998 on the Charter Commission resolution of October 21, 1997.
Vote on the main motion: 11 ayes, 1 nay, Bob Sipkins voting no. The motion
passed.
Contributions
Virgil Schneider called the Commission's attention to the City Attorney's report on
Charter Section 5.01, Subd.l, pertaining to contributions. Virgil Schneider said that he
was confused by the double negatives in the first paragraph of the letter: is the section
constitutional, or not?
Larry Marofsky said that the case law included with the report seems to indicate that the
section is unconstitutional.
Virgil Schneider said that if the section is unconstitutional, then language should be
placed on the ballot to repeal Section 5.20, Subd.1
Kathy Lueckert said that she will have the City Attorney clarify the confusing language in
the first paragraph of his report, and also could have him draft language to repeal Section
5.02, Subd. L
Ellie Singer moved, seconded by Joy Tierney, to have the City Attorney draft
language to correct Plymouth City Charter Section 5.02, Subd. 1. The motion
passed unanimously.
Annual Meeting
Virgil Schneider called the Commission's attention to the draft of the annual report to
Judge Mabley. He asked for comments and suggestions.
Terry Donovan moved, seconded by Kapila Bobra, to approve the annual report to
Judge Mabley and fonvard it on to him. The motion passed unanimously.
Virgil Schneider stated that he was stepping aside as chair of the Charter Commission.
Virgil Schneider suggested that Bob Sipkins had represented the Charter Commission on
several occasions, and would be a good chairman.
191
Plymouth Charter Commission
December 2, 1997
Page 8
Joy Tierney moved, seconded by Kapila Bobra, that Bob Sipkins be elected
chairman of the Charter Commission for 1998. It was moved and seconded that
nominations for chairman be closed. The motion passed. Main motion to elect Bob
Sipkins as chairman of the Charter Commission in 1998 was approved
unanimously.
Ty Bujold moved, seconded by Lori Schwartz, that Ellie Singer be appointed 1998
vice -chair. The motion passed unanimously.
Joy Tierney moved, seconded by Lori Schwartz, that Terry Donovan be appointed
secretary in 1998. The motion passed.
Neat Meeting
Virgil Schneider moved, seconded by Larry Marofsky, that the chairman of the
Charter Commission call a meeting after the City Council discusses the Charter
Commission's October 21, 1997 resolution on the supermajority issue. The motion
passed.
Ty Bujold thanked Virgil Schneider for his leadership and service to the Charter
Commission as chairman from 1991-1997.
The meeting adjourned at 8:35 PM.
130 0
DATE:
TO:
December 2, 1997
Plymouth City Councilmembers and Charter Commission
Members
From: Mayor Joy Tierney
Subject: The Supermajorit_y Vote Amendment to the
City Charter
Public confidence in the integrity of the Government
is indispensable to faith in democracy; and when
we lose faith in the system, we have lost faith
in everything we fight and spend for."
Adlai E. Stevenson
The Charter Commission has twice been purposefully brought into
being in the City of Plymouth. The activation of 1968 as well
as the reactivation of Plymouth'.s::Charterz*Commission in .1991
were a result of,*divisive cfty issues that appeared to be eroding
public confidence in. Plymouth's governmental form and practice.
Now an issue has arisen that again has potention for erosion
of the public trust. The Plymouth City Council has voted to
place on the ballot in 1998 a charter amendment that the Charter
Commission has consistantly been unanimously opposed to. The
Charter Commission, in response`tb:this.11can propose its own
amendment. Given that there could*then'be°two conflicting
amendments presented to the voters with: .an,uricertain legal
outcome if both should pass, the City Council and the Plymouth
Charter Commission could both stand to lose.credibility and
the citizens of Plymouth could once again -see divisiveness and
political notoriety return. This is .the very situation -that
so many of us*in this city have worked hard to not let happen
again. This is the reason I ran for the City Council in 1991
for. Mayor in 1993, and why.I worked to reactivate the Charter
Commission and am proud to serve my full term on the Commission.
Nevertheless, we now have the issue before us and a compromise
solution must be found.
131
PLYMOUTH A BeautifulPlace To Live
nn DI VAAnI MU OnI ll MIAOn . Ill VAgni lTl l --I-e%^A CLAA .Ann Trl rt11 lr\Ir rr.•r.• ten.. ----
A Review of Issues and Proc4
I will propose that the City Council pass a resolution that
at any future regular or special City Council meeting where
Council initiated Charter amendments are being proposed o:t voted
on that all Charter Commission members be informed.:
I content that the process by which this=supermajority.'.a'mendment
came to the City Council for a vote was more.politically-.--
motivated that policy motivated.
First, the issue came before the Council when*I -:the only member
of the Council on the Charter Commission, was put of town.
While all and perhaps most of the Councilmembers-,did-'not know
of my planned absence from that Council meeting°:iia ``was -known'
by the Deputy Mayor months in advance. Given the patently untrue
charges made against me and the Charter Commission (that my
being on the Charter Commission and the City Council posed a
conflict of interest, that any concerns I had about the process
meant I should not serve .on both bodies -simultaneously,. and
that the City Council should not meet with -.the Charter Commission
to discuss the issue with the later exception that -.it be.cable
cast), and the egregious disrespect shown°.the Cha rterCommssion,
I contend*that political gamesmanship had.` -'to' be `;"at_:work 'here:
Second, The manner in which this amendmentcamebefore,the.City
Council has..left theimpressron that; this was! -.a deTiberat`ely%..
orchestrated .end run around the ;Charter,Commission' even of ;,that
was not the intentibnof-alJ`Councilmembecsfe t`?s"+at`l'east;
my hope that'. all Councilmembers were -not. _de'
sireousr`
of''bh" inginsuchamannerbecause, as' was later discogered,end-runningtheCharterCommissonl`cannot be^done..,TheP Charter`c.Commission
is or can be involved: in ahl' Charter ;`AmeridmentsJ Apparent`lythiswasunknowntotheCityManager:;"and Assistant'` City ManagerpriortotheCouncil'vote.'; It was one of.my"..'first.que tions
asked of the City =Manager 'when, I' read ,the:,ze'solu ion upon ..myreturn, "Can':•ahe,aCh}arter<<Commisson 'put ,beforetM-
own resolution?.'."We placed `man 'immediate -,--"con fereceRcali`:.to :
the City Attorney and his answer was' YhF, "Yes:;;: The`serioiisness. of this issue_became:apparent to :me' immediately }.Neither :theCouncilnorthe, staff.:: had -as ked:.the .'questiorii . Neither•tiie;.:..-.
Council nor the, staff,,.thought< it..mportant `to noti f the CharterY.:• Commission as a:'body, or `myself}`as a ,member`of :t1id* Charter
Commission that*".resolutions were.:-propared`;*and ready.,.-for%a'-:Councilvote. The Councih' did.'riot do' adequate homework' prior to `'the
vote. It did not-adequately.discuss •and 'debate.; the issue .atthetimeofthevote*;;''(if:; the: minutes are- a "true .reflection) .
It refused to listen to my concerns in future discussions.
The Council does'now have .opportunity to.revisit this issue
and return to its dil'igent:.ways for which'. this year's Councilcantakepride.
1 3;L
In a recent,Editorial in the Star Tribune under the captionOurperspectiveJusticedelayed," the first paragraph reads,
It goes without saying that politicians love toplaypolitics. It's all in a day's work to plotan. pander,.•block and barter, bicker and back -stab. Often;these.antics do'no harm: They're simply thecondimerit`..on;. the- dry;'--daily;-bread "of - lawmaking. Butsometimes':thls kind of gamesmanship is poisonous. It may be delicious to the players, but it sendsthespectatorsintospasms. A case in point is thegame, of political chicken Congress is playing'at theexpenseofthefederalcourts."
This editorial
court
vacanciesgassaoresultn
to
xPoftheSenaeconcern
te spolitically
about -the number of
motivated slow"justice
P tiallyPaceofconfirmation, delayed, justicedeniedjusticedegraded.
The federal courts are not our issue but the integrity of ourcharter, our City s Constitution, is.
Former Councilmember Chuck Lymongood arrived at the City Councilstudysession -of November 12 where the Council was discussingtherequestby;the Charter Commission to rescind thesupermajority,resolution .or meet':with.the Charter Commissiontod,
options he .came .with a ;video 'camera":and the bookiscuss
by Sun Tzu, "The Art= of..War:'.' I' be1ieve`.he was ' trying to tellussomethin
from `thewery e' inn ng'`
hasKguided„Phis .behavior on the. issues
ti ,-
gl _
I have copied'Wi.11iarrkE -Kirchhoff;'.s use of 15 of Sun Tzu'sateaching atR'he:selected.to illustrate their,`:"Applicationtothe '.field-of':public administration." He states that most, noteworthy ofSun,Tzu'
t fighting
s teachinis. best.". It'is difficult'to believe that
l'
this tis- uthe* lessonformerCouncilmember,:Lymongood.drew:from ahis-book or wantedto:conveysto the_ Council And'staff.;present'at the meeting that
s.
night
Here are "some "other quotesthat may be more ahewantedustobelievehisa PPropriate.to what
and ; possibl • `-_ .. approach -has-beenbeen on this issues' y other'issues)'. We.read about a policy.oftemporizing; and. harassment.. longterm campaign ofharassment.-.. sowing doubt and disenssion.employ deceit andunorthodoxtacticsextensively.... fo knowwhy,he.has been extolling.the virtues thissbooknever sinhecameontheCouncil. It might be well to ask him.
ce
The minutes of September 20,
meeting. You
1996 are copied for you as mycredibilitybecame.a point of discussion at the November 12canseebymy.notes:that I made on the bottomofpage3whenIfirstreceivedtheminutesof -that meeting, that
Councilmember Lymongood requesWthat I call:for a special
133
meeting .of the Charter'Commission because "he" was willing.tocompromise. Three.-members',.of the City Council requested thespecialmeetingtheFriday -before. They apparently wanted VirgilSchneideraschairtocall:the meeting but he was leaving townandwasunableto. I, likewise, was to be out of town and couldnotattendsucha.meeting:but suggested he contact any of the
other Charter Commission'. members as they only needed a majority8) to conduct:;busness.:..His responmse to this suggestion wassometo'the'_effect that he didn't want to influence the
charter commission -so he -would not call around to find others. Later I was criticised for -not calling the meeting and you canseebytheminutes. that rather unfair and indeed untrue
statements were made about'me, such as, Councilmember Andersonstating, "Joy Tierney would not let the Leaguetof Women Voterstakeapositionbecauseshecouldnotdecideontheissue." Indecision had nothing to do with it. I and the League ofWomenvotersdid'not want to sign on to his law suit againsttheCity. Our course was to get a Charter Commission activetohandlethecontroversialissuesofgovernment.) I quesstheyviewedmeasobstructionistwhereasIbelieveIhadlegitimatereasonsandthattheprocessbywhichthecouncilwasapproachingthisissuewasflawed.
I have been through a similar time on the City Council whereCouncilmemberssentletters 'to.the editor which 'includeddeliberately .misledding:information. Copies are available ofthispastPlymouth" event '.if,:you have not seen them or'wouldlike. a copy.).
I believe it `is important for- the CharterCityCouncilnot:Commission and thetorepeatthepast, but to continue goingforwardevermindfulthat`we„are working. for the'long=term bestinterestofthe"C ty.:not'fer"short-term political gains,
13H
Chuck Lymangood
11780 40th Place N
Plymouth, MN 55441
December 8, 1997
yia hand d . iy ry
Dwight Johnson
City Manager
City of Plymouth
3400 Plymouth Blvd.
Plymouth, MN 55447
Dear Mr. Johnson;
I have enclosed for you four copies of my proposal to resolve the issues I addressedatthecouncilmeetinglastWednesdaynight. I respectfully request you to distribute
copies to Mayor Tierney, Councilmember Johnson and Councilmember Preus at
your earliest convenience and in the most expeditious manner possible.
As I hand this document to you I understand its contents now become public. I
hope you and Councilmembers Johnson and Preus are successful in your endeavorstoresolvethissituationpriortoJanuary7, 1998.
If any further communication or information from me will assist you in your efforts, please do not hesitate to contact me.
Sincerely,
a eA
Chuck Lymangoo
enc.
cc: Joycelyn Tierney, mayor
Judy Johnson, councilmember
Christian Preus, councilmember
1350*
M-010) _ DI I
I, Charles G. Lymangood, do hereby submit this proposal to the City
Manager of the City of Plymouth, Mr. Dwight Johnson, as my suggested
format to resolve and partially respond to the actions, statements, and
written memo of Mayor Joycelyn Tierney on the night of December 2,
1997.
I believe the actions of Mayor Tierney towards me and the city council
of the City of Plymouth expressly and implicitly violate both the spirit
and the letter of the Pro Plymouth Pledge. I fully intend and I am now
making preparations for a very spirited defense against this personal,
unprovoked, surprise and vicious attack against me and my family's
name. I fully intend to staunchly defend the political document - the Pro
Plymouth Pledge - which has kept the political peace in Plymouth for
almost four full years.
It is my understanding that the expressed will of the city council is to
table further public debate of this issue until such time as all council
members are present, specifically, January 7, 1998. I will abide by and
submit to this expressed intention on the part of the council. I also
expect that all other parties will abide by this understanding and that I
would be informed if this understanding is incorrect or if anyone wishes
to change this plan of action.
I suggest the City of Plymouth use this window of opportunity, the time
between now and January 7, 1998, to attempt to resolve this issue for
the mutual benefit of the parties involved and most particularly for the
benefit of the people of Plymouth.
134
I propose that the two current at -large councilmembers, Councilmember
Judy Johnson and Councilmember Christian Preus act as my
representatives, my intermediaries if you will, to meet and discuss with
you and the mayor my terms of a peaceful settlement to this conflict.
I believe my choice of these particular two councilmembers is fair, more
than reasonable on my part, and is also logical as to the elected at -large
positions they hold on the council. My choice of these two individuals
is a conscious and deliberate attempt to amicably resolve this conflict.
I ask my representatives, Councilmembers Johnson and Preus, to
encourage the mayor to agree to the following three points:
I. The mayor will agree in writing that the content of her memo
and the way in which it was submitted was a violation of the Pro
Plymouth Pledge.
II. The mayor will agree in writing, upon further reflection and
with the best interests of the people of Plymouth at heart, to rescind her
memo of December 2, 1997 in its entirety.
III. The mayor will agree to publicly apologize to me, to my
family, to the Plymouth City Council and to the people of Plymouth for
any ill will said memo and her public statements have created. This
apology is to be delivered at a regular Plymouth City Council meeting
with all members present and also at the next regular meeting of the
Charter Commission.
13}
In addition, I have other procedural issues the council may well wish to
consider instituting to insure future meetings of its council and
commissions do not repeat this unfortunate incident. Furthermore, if
the mayor and the selected representatives are able to reach agreement
under the items outlined above, I will agree to not make any further
public statements about the memo. In the true spirit of Christian
forgiveness it will be as though it never occurred.
It is as though a worn garment, the Pro Plymouth Pledge, has been
stained. With forgiveness the stain is not only removed, but the whole
garment is fully restored to its original pristine condition. In the
absence of an agreement, I fear the actions on the evening of December
221997 will become known as the "night which will live in infamy" in
Plymouth history.
Finally, I also believe that if the mayor agrees to the above outlined
conditions her stature and public standing will increase immeasurably.
How unfortunate it would beat the pinnacle of her many many years of
public service to the people of Plymouth that her legacy would now be
tarnished because of the actions of a single evening. Please, GIVE
PEACE A CHANCE.
Respectfully submitted,
Charles G. Lymangood
131
Chuck Lymangood
11780 - 40th Avenue North
Plymouth, MN 55441
December 30, 1997
Dear Mr. Lymangood,
I am responding to your City Manager directed proposal of
December 8 concerning the supermajority Charter issue. The
political nature of this issue should preclude the City Manager
from responding.
Let me clarify my position. I was first elected to the Plymouth
Council in 1992. The divisive political behavior in Plymouth
in the preceding years had brought the City local and state
news coverage that while colorful was most unpraiseworthy and
embarrassing to the City. About six months into my first year,
the City Manager resigned. Prior to this the majority on the
City Council had been public about their desire to affect this
resignation. However, it wasn't the resignation that raised
the greated concerns with me but the manner in which it came
about and the behavior of the major players after the event.
Responding to a need to apprise the public of the situation,
the Mayor and a Councilmember, with whom I was serving, sent
letters to the editor. Unfortunately, their letters attack
nature offered a rendition of outrageously dubious truth. By
responding to one of these letters I wrote my version of what
I believed to•be the truth of the situation. My response was
submitted to the City Council, the staff and our City'Attorney
Firm at the time. (The City Attorney was requesting a 32%
budgetary increase for his Firm that I was strongly objecting
to. I have provided all Councilmembers with copies for their
information.)
My biggest concerns then were similar to those I have now with
the supermajority issue that is before us. While I stand on
the side of the Charter Commission and remain opposed to the
Council approved resolution, it is the perceived deliberate
attempt to cut me, i.e., the Charter Commission, out of the
debate, the numerous efforts at silencing my expressions of
concern, the in -your -face intimidations, and the knowing
dissemination of false information to the public that have caused
131 .
PLYMOUTH A Bcaufi%dPlacc To Livc
3400 PLYMOUTH BOULEVARD • PLYMOUTH, MINNESOTA 55447-1482 • TELEPHONE (61. 21 5r' , .:::_
CITY OF
PLYMOUT-
Chuck Lymangood
11780 - 40th Avenue North
Plymouth, MN 55441
December 30, 1997
Dear Mr. Lymangood,
I am responding to your City Manager directed proposal of
December 8 concerning the supermajority Charter issue. The
political nature of this issue should preclude the City Manager
from responding.
Let me clarify my position. I was first elected to the Plymouth
Council in 1992. The divisive political behavior in Plymouth
in the preceding years had brought the City local and state
news coverage that while colorful was most unpraiseworthy and
embarrassing to the City. About six months into my first year,
the City Manager resigned. Prior to this the majority on the
City Council had been public about their desire to affect this
resignation. However, it wasn't the resignation that raised
the greated concerns with me but the manner in which it came
about and the behavior of the major players after the event.
Responding to a need to apprise the public of the situation,
the Mayor and a Councilmember, with whom I was serving, sent
letters to the editor. Unfortunately, their letters attack
nature offered a rendition of outrageously dubious truth. By
responding to one of these letters I wrote my version of what
I believed to•be the truth of the situation. My response was
submitted to the City Council, the staff and our City'Attorney
Firm at the time. (The City Attorney was requesting a 32%
budgetary increase for his Firm that I was strongly objecting
to. I have provided all Councilmembers with copies for their
information.)
My biggest concerns then were similar to those I have now with
the supermajority issue that is before us. While I stand on
the side of the Charter Commission and remain opposed to the
Council approved resolution, it is the perceived deliberate
attempt to cut me, i.e., the Charter Commission, out of the
debate, the numerous efforts at silencing my expressions of
concern, the in -your -face intimidations, and the knowing
dissemination of false information to the public that have caused
131 .
PLYMOUTH A Bcaufi%dPlacc To Livc
3400 PLYMOUTH BOULEVARD • PLYMOUTH, MINNESOTA 55447-1482 • TELEPHONE (61. 21 5r' , .:::_
P.2
my anger.
I realize the memo you object to is passion filled. On the
other hand, I find no untrue facts mixed in with my burst of
righteous indignation. I stand in strong opposition to the
use of political tactics that violate sound democratic principles
full and open public debate and comment, honest presentation
of the facts, and adherence to a fully participatory process.
This supermajority issue is remininiscent of this prior one
which is still all too vivid in my mind. To add to the
consternation, the Charter Commission, which was brought back
to life in Plymouth to handle divisive issues like the odd/even
vote, number of Councilmembers, the ward system, citizen
involvement when spending Community Improvement Funds and etc.,
was treated and continues to be treated with embarrassing
disrespect, intentionally or unintentionally.
Frustration magnifies for me when I see the amount of time,
effort and money that has been and will continue to be diverted
from other deserving city issues onto this one. I've been there
before.
Mr. Lymangood, you have stated in your proposal that you are
trying to broker an agreement, that I have made an unprovoked
attack against you, that I have violated the Pro -Plymouth Pledge
and that I owe you and the Plymouth City Council an apology.
I will address your concerns.
First, I hope I am seeing some interest on your side to broker
some kind of resolution between the City Council and the Charter
Commission. No one could be more pleased than I to see this
issue resolved expediously and in the best interest of the
citizens of Plymouth. Whatever proposal you or anyone you
choose to work with could broker would certainly be given
consideration. City Manager Johnson, as always, will be willing
to help with specific substantive issues. However, staff does
not interject themselves into political battles.
Did I engage in an unprovoked attack at the December 2nd Charter
Commission meeting? I do not see it that way. I will admit
to showing some battle fatigue, but, as your know, I had tried
numerous times to get you and the others on the previous council
to address my process and procedure concerns but my requests
were met with indifference at best and hostitity at worst.
Your hostility, in particular, was most apparent to me. This,
along with your refusal to talk to.me directly and the reports
I heard of how'you frequently talked about the quiding strategy
of your political life, "The Art Of War," had -me wary of your, tactics and behaviors. (I bought the book over two years ago
so I would have knowledge of where you may be coming from.' Prior to that, in 1994 or 1995 I handed out the Governing
Magazine article on the book as it relates to City Managers.
10
P.3
Anyway, I was not unfamiliar with the book or your stated
devotion to its principles or at least "war".) On the surface,
however, the appearance of a book on "war" at a Council study
session where the Charter issue is being discussed does send
a message. Given my previous experience and knowledge I saw
this as a tactical maneuver designed to send a message that
was not at all related to peace. I do not believe I was out
of line in informing the Charter Commission of this display.
You have taken a major leadership role in moving the adoption
of the supermajority charter amendment and are, obviously,
interested in continuing to be involved. Furthermore, I have
been of the believe that your strategy of war with like tactics
and behaviors was something you took pride in. I have found
this offensive, but how can I offend you if what you have done
is something you take pride in and count as a success?
Did I violate the Pro Plymouth Pledge? As you may know last
January neither Councilmember Johnson nor I voted to approve
the Pro Plymouth Pledge. When words and hehaviors of
Councilmembers too frequently miss the intent of the Pledge,
which is civility, it becames a document to be mocked.
Furthermore, when the expressed disapproval of misrepresentations
of fact or rude behavior becomes a violation of the Pro Plymouth
Pledge, the Pledge becomes a hammer by which truth was pounded
down. .I could not nor will not pledge to such mockery. Indeed,
I believe Councilmembers have a obligation to the citizenry
to provide them with correct information and to themselves to
not give in to harassment. If the City Council would seek the
help of an outside facilitator in working out these differences
and develop a pledge that is meaningful to all citizens and
councilmembers and gets full Council respect, then I will be
willing to support such a pledge. It isn't the intent of the
Pledge I object to. It is the practice.
Do I owe you and the Plymouth City Council an agology? How
can one apologize for beliefs., feelings and facts? The December
2nd memo may not have been eloquent. (It was done in enough
haste to be disjointed and contain several typos.) It did,
however, contain truthful statements that:
Expressed my concern that the City Council be attuned
to the importance of proper procedures.
PA
the attempts to control information were acceptable. It
may also mean that a combative mode on this issue is still
alive and well.
Put forth information that I believed was important to
the Charter Commission as well as this City Council.
I have talked to both Councilmembers Preus and Johnson following
their meeting to discus your request. (I have thanked them
for taking the time to do this, as they were under no obligated
to do so.) However, your letter does not specify particular
offenses so I don't believe we are totally clear as to what
I am to apologize for.
First of all, I cannot rescind my memo of December 2nd. Are
you objecting to the facts or the tone? I'm sure additional
time spent on it would have produced a better, more readable
and less angst filled product even if the facts remained the
same. However, I believe I'm entitled to some righteous
indignation. I stand by my assessment that Council procedures
on notification, discussion and citizen involvement were sub -par
and that they will not be made whole by a cover-up. For the
Plymouth City Council to find that it has committed a procedural
glitch should not be startling news. It has happened before
and it will happen again. When such is discovered, however,
it is proper to address it and make the necessary policy or
other changes to help correct the glitches if possible and,
if not, to try to ensure that it not happen again. Silencing
those who point out the problem is not the solution.
You will have to explain why I am to apologize. I cannot
apologize for your behavior or your overall strategy or "war."
These are choices you made and made publicly. I shouldn't
have to apologize for observing them. I certainly shouldn't
have to apologize for the misleading statements you made about
me. This leads to other questions: If you are not proud of
them then what motivated your behavior? Did they or did they
not effect the outcome you desired? What did you intend by
displaying the book, "The Art Of War" at the Council study
session? As I stated before, I honestly thought you were taking
pride in what you did. I would gladly accept correction if
I am mistaken.
P.5
your proposal for PEACE. However, I am open to any solution
you may have to this potentionally embarrassing and resource
consuming course this charter issue is on. As much as I like
PEACE, my main goal in serving the citizens of Plymouth is to
return PRIDE to our city's governence. Anything you can do
there, I would welcome as well.
Sincerely,
Joy/ Tierney
Mayor of Plymouth
cc: Plymouth City Councilmembers
Plymouth Charter Commission
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IN4
Proposed City Council Minutes
January 7, 1998
Page 12
Motion carried, six ayes; Spigner absent.
Item 8-13 (9-F) Discussion of Charter Commission December Resolution
Mayor Tierney said that the Charter Commission adopted a resolution in late
1997 relating to the supermajority vote issue and is looking for a response
from the City Council. The City Council discussed the resolution at a study
session, but took no action.
Councilmember Johnson clarified that while the Council took no immediate
action at the study session, the Council indicated that the issue would be
placed on a future study session agenda.
Assistant Manager Lueckert explained that at its December 2, 1997 meeting,
the Charter Commission adopted a resolution asking the City Council to
consider its October 21 resolution. The October 21 resolution requested that
the Council repeal Ordinance 96-9 and Resolution 96-555; these actions place
the proposed supermajority charter amendment on the ballot in November
1998. She said the Charter Commission's December resolution requests the
City Council to discuss the possible repeal of the ordinance and resolution at a
regular City Council meeting and further requests that the City Council hold a
public hearing on the possible repeal of the proposed supermajority
amendment by April 1, 1998.
Assistant Manager Lueckert stated that the City Council has several options:
1) As requested by the Charter Commission, discuss the Charter
Commission's October 21 resolution at the January 7 meeting, or schedule the
discussion for a future regular meeting; 2) Schedule a discussion of the
Charter Commission's request for a future study session, possibly in February
or March; and 3) Take no action on the Charter Commission's request. She
said the Charter Commission recognizes that their resolution is a request to the
Council and that the Council is not bound to take any action.
Mayor Tierney said that if the Council decides to take no action, she would
like a written response made to the Charter Commission.
Councilmember Preus said that when this issue was discussed at the City
Council study session, the Council directed that the issue be placed on a study
session agenda during the first quarter of 1998. He sees no reason that further
action is needed by the Council at this time.
Councilmember Black agreed that no further action is needed at this time.
She has reviewed the entire file on the supermajority vote issue. She believes
that the report forwarded to the City Council by the Charter Commission on
lqf
Proposed City Council Minutes
January 7, 1998
Page 13
this issue did not present all of the facts, both pro and con on the issue, and did
not present options for addressing concerns. She said the discussion on the
issue to date has been emotional and full of opinions and views. The facts
have not been clearly explained. She does not believe the Council can do this
work tonight, and she favors further discussion at a study session.
Councilmember Johnson concurred with Councilmember Black's comments.
She suggested that the Charter Commission could be invited to attend and
participate in the upcoming study session on the issue.
Councilmember Wold asked if any new information was presented by the
Charter Commission regarding this amendment.
Assistant Manager responded no.
Councilmember Wold stated that in light of no new information being
presented, he is perplexed why the Council would again discuss the issue. He
has heard all of the arguments against the proposed Charter amendment and
was not persuaded. Councilmember Wold said that the Council should
reconsider an issue if there is a problem with the method of voting, new
information, or some issue not given due consideration. In this case, the
Council saw all of the facts, studied the issue, and overwhelmingly voted to
support it. He believes the Council should move on to other issues.
Councilmember Spigner agreed that the Council should not spend additional
time on the supermajority vote issue, especially at a study session. She
supports Option 3 to take no action on the Charter Commission's request.
Councilmember Johnson said that there are new members on the City Council
and the Charter Commission. She said the argument was made during the
1996 Council discussion, that the voters, through implied approval, were
supporting the supermajority issue because candidates had included that in
their campaign literature. She has heard all of the arguments, but has not had
the opportunity to discuss and weigh the arguments with the City Council.
Chuck Lymangood, 11780 40'' Place North, spoke in favor of the item. He
said that the City Council took action at the November 12 study session to
place the issue on an upcoming study session agenda; however, the Charter
Commission was told that the Council took no action. He spoke with the
Mayor today and believes that the Council should hold a meeting on the issue,
with an invitation to the Charter Commission to attend the meeting, and that
the Council should take a vote to rescind or not to rescind. He believes that a
vote should be taken by the Council in order to clarify the misunderstandings
M11
Proposed City Council Minutes
January 7, 1998
Page 14
that have occurred. He believes that a lack of proper communication between
the City Council and the Charter Commission is interfering with the
addressing of the issue. The Charter Commission was told that the Council
took no action, so the Commission twice more asked the Council to consider
the issue. He suggested that the Council place the issue on an agenda as soon
as possible.
Mayor Tierney said that the issue should be addressed in a study session by
April 1 so that the City Council could then place the issue on a regular agenda
or conduct a public hearing. She agrees that the issue should be considered at
a regular meeting with the Charter Commission present.
Councilmember Preus said that the Council has already placed the item on a
future study session. He is not ready to commit to a regular Council meeting
or public hearing on the issue.
Councilmember Black said that citizens need information on the
supermajority issue in order to make an educated vote. She would like to get
information on the pros and cons of the proposal to the public.
Motion was made by Councilmember Johnson, seconded by Councilmember
Wold, that the upcoming Council study session be held in the Council
Chambers, videotaped, and replayed on Channel 37.
Councilmember Wold agreed that the public should have the right of greatest
access to that meeting.
Councilmember Johnson said that although all City Council meetings are
noticed, she would like to generate additional interest and notice of the study
session.
Motion to amend was made by Councilmember Preus, seconded by
Councilmember Wold, to establish the study session on the supermajority vote
issue on March 11 at 7:00 p.m., with the Charter Commission invited to
attend.
Motion to amend carried, seven ayes. Main motion as amended carried, six
ayes; Spigner nay.
Item 8-C (9-G) Discussion of Mr. Lymangood's Forum Comments
Councilmember Wold said that Mr. Lymangood's comments at a previous
Plymouth Forum were tabled to this meeting, as well as the content of those
1"I
Proposed City Council Minutes
January 7, 1998
Page 15
comments which were regarding a December 2 memo written by Mayor
Tierney.
Chuck Lymangood, 11780 40" Place North, referenced the placement of this
item on the agenda. He said that his tendency would be to address issues
contained in the Mayor's memo item by item; however, he will not do so
because he does not want to "make a war." He said that when two Council
members purposefully place an item at the end of the agenda and involve the
City Manager's office in doing so, it is disrespectful to him. He said it was
also disrespectful that the staff report distributed to the City Council and the
news media included the Mayor's memo but not his memo which attempted to
make peace on the issue.
Mayor Tierney said that the City Council has received both her memo and the
response of Mr. Lymangood. She directed staff to provide both memos to the
news media.
Councilmember Johnson said that no disrespect was intended with respect to
the placement of this item on the agenda.
Councilmember Black requested that Mr. Lymangood be allowed to make his
comments without interruption.
Mr. Lymangood said that he had taken the time to write a memo and expected
it to be included along with the Mayor's memo, as a matter of respect. He
said the issue for the City Council is how the Council is going to conduct
debates and discussion in a respectful manner in order to get to the issues and
not interject personalities. He distributed a list of observations about the
Mayor's memo and suggestions for the City Council. He read an excerpt from
Dr. Martin Luther King's speech "I Have a Dream." Mr. Lymangood said it is
his dream that the citizens, employees, and elected leaders of Plymouth would
be judged not by the color of false accusations made about them, but by the
content of their contributions to the City of Plymouth.
Councilmember Black said that she believes each individual is entitled to their
view on the supermajority vote issue. She may vote against the proposed
amendment when it appears on the ballot, but it is her view that residents
deserve the opportunity to vote on the issue. She is concerned about the
attitude, tone, and statements in the Mayor's memos of December 2 and
December 30 because she believes the correspondence was disrespectful to
Mr. Lymangood and potentially disrespectful to City Council members.
There have been accusations that the supermajority vote issue has eroded the
public trust of the voters. She takes issue with that statement. Several
X50
Proposed City Council Minutes
January 7, 1998
Page 16
candidates placed the supermajority issue on their campaign material because
they believed there is already a breach of confidence by the public in local
government. One of those reasons is that they feel their taxes, at times, have
been increased unduly to pay for programs they do not want. The
supermajority issue was proposed to help restore the public's confidence and
give them the opportunity to vote on the issue.
Councilmember Black said that it is her view that a single issue, such as the
proposed supermajority issue, cannot erode public trust. It is the handling of
the issue that erodes public trust, i.e. including bickering, bringing in of
personal views, emotional discussions, disrespect shown others. She believes
that the Mayor's memo of December 2 and letter of December 30 promotes
that kind of distrust through its tone and content. She said the December 30
letter stated that not all council members voted in favor of the Pro -Plymouth
Pledge. She has reviewed the alternatives discussed by the Council and noted
that all versions contain the language, "to be civil to our fellow
councilmembers, staff, and citizens by dealing courteously, honestly, and
respectfully, and refraining from personal attacks." Even though some
members may have not voted for the Pro -Plymouth Pledge, they in effect
voted for that language because it was in all proposed versions. She would
like a factual presentation on the supermajority issue so the voters have as
much information as possible when voting on the issue. She would like an
explanation and clarification of certain statements in the Mayor's memos such
as "in -your -face intimidation", "silencing my expression of concern," and
end run around the Charter Commission." She doesn't know what these
comments mean and doesn't believe this was done. The Charter Commission
receives notices of the Council meetings, and she asked what additional notice
they desire.
Mayor Tierney said that some of the statements noted in her memo and letter
related to occurrences of the prior City Council. She agrees that it is the
handling of an issue that erodes public trust and this has happened to a certain
extent on this issue. She is concerned that there is a potential for two
conflicting issues to come before the voters, and she believes it is time that the
Council and Charter Commission meet to discuss the issue. Mayor Tierney
volunteered to privately or publicly meet to discuss past behavior of
Councilmembers. She said that the Charter Commission has requested that
the Council meet with them. It is not friendly that the City Council has not
honored the request or made an adequate response. She believes it is positive
that the Council has now agreed to meet with them.
Councilmember Spigner said she doesn't believe that the Council has honored
the Charter Commission's request to meet with them. She clarified that the
s)
Proposed City Council Minutes
January 7, 1998
Page 17
City Council has set a study session to study the supermajority vote issue, and
the Charter Commission is welcome to attend.
Assistant Manager Lueckert said it is her understanding that the Council will
conduct a study session and the Charter Commission is welcomed and invited
to attend.
Mayor Tierney said she would be willing to meet with Councilmember Black
to review other details in her December 2 and 30 correspondence.
Councilmember Spigner said that she would like the Mayor to explain
specific issues in her letters with the entire Council.
Councilmember Wold said that he is concerned with many issues in the
Mayor's letters that are too numerous to discuss at this meeting. He said that
the letters accuse him of doing something that was politically -motivated and
not policy -motivated, of playing games, and of doing a variety of things that
he did not do. He believes that the Mayor made unfounded and unsupported
accusations against a former Councilmember. Councilmember Wold asked
whether the Council is now going to take an issue that was overwhelming
supported by the City Council and play games with it. He said the Mayor
compared this Council to the "dark days of the past" when letters were sent to
the editor of questionable tone, theme, and fact. However, this has not been
recently repeated. Councilmember Wold said the Mayor's memos are
disturbing, and he suggested that the Mayor rescind the memos and admit that
they were ill-conceived. He stated that Mr. Lymangood asked for a simple
apology which the Mayor responded to with another vicious attack against
Mr. Lymangood and other former Councilmembers. He is saddened and very
concerned where the Council is headed.
Mayor Tierney said there is remaining business on the agenda and this issue
can be discussed later.
Councilmember Wold said he will not relinquish the floor.
Mayor Tierney said that when she tried to speak on this issue 1 '/z years ago,
Councilmember Wold strongly spoke up and said that Mayor Tierney was not
allowed to speak and that the Council did not want to hear her concerns. She
deeply resents that the Council voted to call the question in order to cut off her
concerns. She recognized Councilmember Johnson.
Councilmember Preus made a point of order. He said that Councilmember
Wold has the floor, and the Chair does not have the right to unilaterally take it
S.t
Proposed City Council Minutes
January 7, 1998
Page 18
away. The five-minute rule does not apply to Councilmembers, and he
requested that Councilmember Wold be allowed to continue his comments
without interruption.
Mayor Tierney reminded Councilmember Wold that the behavior requested by
the Council tonight is the same behavior that she expected of the Council 1'/2
years ago when discussing the supermajority issue. She supports allowing
members to fully speak on issues.
Councilmember Wold responded that under parliamentary procedure, once a
motion has been adopted to call the question, there may be no further
discussion. He characterized the Mayor's correspondence as "bashing a
former councilmember."
Councilmember Johnson said that during her campaign she brought forward a
complaint against a former councilmember for a violation of the Pro Plymouth
Pledge. She. said that everyone makes mistakes, and the Council needs to
move on with its business. If Councilmembers want to get into details of a
memo, then the issue should be placed on a study session.
Councilmember Spigner said that these are good points; however, her main
concern is the image that has been placed on the City Council by these
memos. She said the Council can place this item on a study session to "cover
up" the discussion. She does not want only one or two council members to
meet with the Mayor for clarification of the issues when the entire Council
and the public need clarification. She said that some of her constituents have
read these memos, and they have unanswered questions. She stated that the
public does not understand why the Council is bickering on the dais, and she
believes that the City Council should review the document under which they
have chosen to govern their behavior.
Councilmember Johnson stated that her intent was not to cover up issues by
placing the discussion on a study session.
Mayor Tierney said that she would be willing to meet with some or all
Councilmembers to discuss the issues in her memos. She noted that the
Council had tabled this agenda item until all Councilmembers could be in
attendance. However, the supermajority vote issue came before the City
Council when she was not present at the meeting. When she expressed her
displeasure that action was taken at a meeting when she, as a representative of
the Charter Commission, was not present to participate, she was informed that
it was not appropriate for her to be speaking.
S3
Proposed City Council Minutes
January 7, 1998
Page 19
Mayor Tierney said that the accusation that the Charter Commission violated
the Open Meeting Law is not correct, and it puts the City in a potentially
embarrassing situation. She said this is an internal Council issue, and she took
deference from past antagonistic behaviors on the part of some
Councilmembers. She said that when a person appears at a meeting with a
war book to discuss a divisive issue, it is evidence of what she has been
tolerating from a certain councilmember or others. She believes it sends a
message.
Mayor Tierney called the next agenda item.
Councilmember Wold said that he refuses to move on to the next agenda item.
He said the Mayor is making innuendo and speaking to the intent of others'
behaviors which is a problem and her assumptions are completely inaccurate.
He said that it is not his fault that the Mayor wrote these memos, that she
mischaracterized this issue and the events surrounding this issue, or that she
attacked Mr. Lymangood and the entire City Council.
Motion was made by Councilmember Johnson, seconded by Councilmember
Black, to suspend the rules by moving to the other items on the agenda, and
when those are completed to continue the discussion on this item at this
meeting. Motion failed: Johnson and Tierney ayes; Bildsoe, Wold, Preus,
Spigner, and Black nays.
Motion was made by Councilmember Wold to postpone this issue to the next
regular Council meeting. Mayor Tierney ruled that the motion died for lack of
a second.
Mayor Tierney stated that she will call a special meeting to provide history on
this issue. She said there is a lack of understanding about this issue and her
feelings, which largely relate to the previous Council. She believes it is
counterproductive for this Council to bring up this issue, and she applauds the
efforts of this Council for agreeing to meet with the Charter Commission. She
called the next agenda item.
Councilmember Preus stated that during the past six weeks, Mr. Lymangood
has been publicly attacked and unfairly insulted. However, Mr. Lymangood
recommended a solution on the last agenda to get a good, positive relationship
between the City Council and the Charter Commission. He said that Mr.
Lymangood's conduct and statements on this item are peaceful. He has
suggested that the Council should stick to the issues and has provided a list of
five suggestions for consideration.
5-1
Proposed City Council Minutes
January 7, 1998
Page 20
Councilmember Preus stated that Councilmember Black did an excellent job
of discussing concerns and asking good questions in a conciliatory manner
about the two memos written by the Mayor. He believes that Councilmember
Black deserves an answer to her questions tonight. He said that
Councilmember Spigner spoke to the public's desire to understand this issue,
for the Council to address substantive issues, and to end personal attacks. He
believes that the City Council has been incredibly productive during the past
three years, and 1998 can be equally as productive. This can be accomplished
in a peaceful or combative fashion. He said that Councilmember Black
indicated that the Mayor's memos of December 2 and 30 are combative, and
he was personally offended by many of the statements which were unfair and
untrue. He suggested that the Mayor retract the memos so the Council can
move on with its business in a peaceful and productive manner. He said that
he had called the Mayor a week ago and asked her to apologize and retract the
letters, which would be an honorable and good thing.
Mayor Tierney said that she has apologized to Mr. Lymangood for being hasty
in writing the first memo. She doesn't know how to retract a memo that she
believes contains truthful information. She admits that the memo was written
in anger due to frustrations with past behaviors. She doesn't appreciate when
the Council is discussing a sensitive issue to have someone declare that "this
is going to war." She found that statement offensive. She apologized for
typos in the memos and for writing down what she could have said in public.
She will call a meeting to discuss it further.
Councilmember Black agreed with Councilmember Preus that it is important
that the Mayor apologize and move on. She has read all information on the
proposed supermajority issue and disagrees that the content of the Mayor's
December 2 and 30 memos is fact. She believes that some fact is contained in
them, but it is colored by the Mayor's anger and frustration which puts it into
the realm of offending Mr. Lymangood, as well as Councilmembers. She said
that the Council is not asking the Mayor to apologize for the fact that is
contained in the memos. The Council is asking for an apology for the tone
and personal perspective that slanted the facts in the memos.
Mayor Tierney suggested that if Mr. Lymangood would come forward and
state that he is not declaring war on this issue, they could shake hands and
declare the issue closed.
Councilmember Johnson suggested that the Council act on the five
suggestions submitted by Mr. Lymangood.
lSt
Proposed City Council Minutes
January 7, 1998
Page 21
Motion was made by Councilmember Johnson, seconded by Councilmember
Black, to respectfully request the Plymouth Charter Commission to consider
adding at each of its subsequent annual meetings a provision for public input.
Motion carried, seven ayes.
Motion was made by Councilmember Johnson, seconded by Councilmember
Black, to adopt RESOLUTION 98-30 REGARDING PREPARATION
OF CITY COUNCIL MINUTES. Motion carried, seven ayes.
Mayor Tierney asked Mr. Lymangood to come forward to shake hands and
put the issue to rest.
Councilmember Preus said that Mayor Tierney's proposal that Mr.
Lymangood come forward and shake hands is premised on the Mayor's
conclusion that Mr. Lymangood declared war. This conclusion was unfairly
drawn because Mr. Lymangood had a book with him which has the primary
purpose of avoiding war. Councilmember Preus said that Mayor Tierney is
now asking Mr. Lymangood to defend himself, giving the impression that he
is no longer declaring war. He said these are unfair allegations, and the Mayor
should retract the statements and shake Mr. Lymangood's hand.
Mayor Tierney said that she did not state Mr. Lymangood was declaring war
in her memos, and she had supplied additional information in her
correspondence on the book he was carrying. She said that because Mr.
Lymangood did not explain why he was behaving in the way he was, she was
left to make her own conclusions based on past behaviors. She said that she
has been at odds with him in the past, and suggested that it be put in the past
now.
Councilmember Black said that from reading Mayor Tierney's memo of
December 2, she believed that Mayor Tierney was stating that Mr.
Lymangood was declaring war, based on the title of the book he was carrying.
If that was not Mayor Tierney's intent, it was not clear.
Mayor Tierney said that she had not heard why Mr. Lymangood carried this
book to the Council study session and, therefore, individuals are left to their
own devices to interpret his intent.
Councilmember Black said that at the November 12 study session, Mr.
Lymangood held up the book and talked about how it referenced avoiding
war.
f&
Proposed City Council Minutes
January 7, 1998
Page 22
Mayor Tierney said that when a sensitive issue is being discussed, individuals
should show sensitivity toward it. There was not the sensitivity that she
would like to have seen at that study session. She asked Mr. Lymangood to
address the issue.
Mr. Lymangood said that he attended the study session on November 12 and
had two books with him. The second book was on composting. He
questioned the right of a public official to make an interpretation and put these
words in print, when a citizen is silently reading a book. He said that Roberts
Rules of Order clearly states that the Council is prohibited from inferring
intentions from people's actions and directed to address the issues. He was
silently reading a book and never referred to it at that meeting. Mr.
Lymangood said that he was bored at the study session, and left for 20
minutes to go for a jog. He said that he was exercising his legal right to tape
the meeting, and the City Manager asked for a copy of the tape to help make
the meeting minutes. He said that the Mayor wants to shake his hand, but
won't publicly apologize for misspelling his name four times.
Mayor Tierney apologized for misspelling Mr. Lymangood's name four times.
She said it was a hurriedly written memo and that she had earlier apologized
to Mr. Lymangood for the misspellings.
Mr. Lymangood said that the Mayor placed a document into the public
discussion and now believes that a private apologize suffices; however, the
public insult remains. He said that if the Mayor would apologize for violating
the Pro -Plymouth Pledge and for wrongly inferring intentions, and would
commit tonight to deal with the issue and not personalities, he would shake
her hand.
Mayor Tierney apologized for misspelling Mr. Lymangood's name. She said
that the memo was hastily written and that she was very frustrated with a year-
long discussion of an issue that she would like resolved, rather than taking
time at each Council meeting. She said that she had thought there was a
reason that Mr. Lymangood was holding up a book on war, and that he was
not just reading it. Mayor Tierney said that she would like to shake his hand
because there appears to be a misunderstanding about what that meant. If it
meant further problems, it should be openly discussed. She said that she
cannot apologize for a misinterpretation of Mr. Lymangood's intent when she
knows that it has been part of his conversations for years. She said that she
did not know what he meant by his action and apologized if her inference was
wrong.
Y471
Proposed City Council Minutes
January 7, 1998
Page 23
Councilmember Preus said that the Mayor is wrong and should apologize. He
said the Mayor proved she is wrong with her statement that she does not know
Mr. Lymangood's intention. Yet, she put the worst conceivable interpretation
of his acts. He said that this is not what anyone else wants and asked that the
Mayor apologize.
Mayor Tierney said that she has apologized.
Motion was made by Councilmember Spigner, seconded by Councilmember
Black, "Whereas, in light of the content of the Mayor's memo of 12/2/97, the
way in which it was presented, and her refusal to publicly apologize to Chuck
Lymangood and to the Plymouth City Council, therefore, be it resolved that
the Mayor's above referenced actions violate sections 2, 3, 4, and 6 of the Pro
Plymouth Pledge."
Councilmember Johnson requested copies of the Pro -Plymouth Pledge, which
staff distributed.
Councilmember Spigner said that this issue may be too imbedded to address
tonight, and the Council needs to move ahead to consider other items on the
agenda. She said that tonight's meeting is important because the Council will
be making appointments to boards and commissions, designating the official
newspaper, and acting on other important citizen issues. She personally
apologized to the citizens for anything they observed at this meeting and
disagreed with or didn't like. She said this was not representative of
Plymouth's elected officials. She asked that the Council move on to other
issues.
Councilmember Johnson stated that it is difficult for her to support the motion
because she feels it is uncharted territory. She said that no one has previously
brought forward a violation of the Pro Plymouth Pledge; however, past
minutes indicate that there have been violations by various council members.
She said that she believes someone violated the Pledge against her last year.
She brought the issue to the City and nothing happened. She cautioned the
Council to be careful and thoughtful before deciding consequences of
violating the Pledge.
Councilmember Spigner said the Council is just making a statement of fact
and moving on. She doesn't believe there are any consequences; it is merely a
public statement of fact.
Motion carried: Wold, Preus, Spigner, Bildsoe, Black, and Johnson ayes;
Blac-kTierney nay.
Proposed City Council Minutes
January 7, 1998
Page 24
Motion was made by Councilmember Preus, seconded by Councilmember
Black, to adopt RESOLUTION 98-31 TAPING OF SPECIAL CITY
COUNCIL MEETINGS. Motion carried, seven ayes.
Councilmember Johnson said that this could be done by audio or video tape.
Motion was made by Councilmember Johnson, seconded by Councilmember
Black, to direct staff to make copies available free of charge to whomever asks
of all three memos, and any other documents deemed appropriate, pertinent to
this subject. Motion carried, seven ayes.
8-1) (6-A) Approve Minutes
Councilmember Spigner asked for clarification on the draft minutes of the
November 12 Special Council meeting.
M ager Johnson explained that discussion on the Wellness Committee
prop_ 1 has been added to the draft minutes of November 12, submitted by
staff fo\
Regul
he City Council.
Motion Councilmember Johnson, seconded by Councilmember
Spignehe proposed minutes of the November 12 Special
CouncDecember 10 Special Council Meeting, and the
Decemouncil Meeting as submitted with the January 7
agenda packet.
Councilmember Preus made a orrection to Page 8 of the December 10
Special Council meeting minute reflect the vote on the motion to set the
Council conference and travel budg at $4,500.
This change was accepted as a friendly am dment to the main motion.
Motion carried, seven ayes.
Item 8-E (6-Z) Outdoor Mobile Performance Stage
Councilmember Preus said that it is his understanding, b ed on the staff
report, that the City previously rented a portable stage t e City of
Richfield at the cost of $1,000 per day. This option is no longe vailable, and
the cost of purchasing a stage is estimated at $85,000. He asked iher
alternatives were considered, including renting from entities other tha the
City of Richfield.
AN INFORMATION REPORT
AD -
TAIX AN® EXPHN01TURE LIMITS
ON L®CAL. G®VER/VMEJVTS
Center for Urban Policy
and the Environment
Indiana University
Advisory Commission
on Intergovernmental Relations
March 1995 M-194
INTRODUCTION
States have imposed a variety of statutory
and constitutional limitations on local fiscal
autonomy. These limitations, which exist in 46
states, have:
Resulted in more use of fees and mis-
cellaneous revenues and less use of
broad-based tax sources;
Shifted power and responsibility to
the state through increased reliance
on state revenue sources and state
assumption of service responsibili-
ties; and
Shifted responsibility for local gov-
ernment functions through the cre-
ation of special districts. I
The limitations have been designed osten-
sibly to (1) control and reduce property taxes,
2) control the growth of government and pub-
lic spending, and (3) improve fiscal account-
ability.2
This report presents the results of an
extensive study of local tax and expenditure
limitations (TELs) imposed by states. The
study emphasizes design, amount of allowable
growth, affected local governments, circum-
vention mechanisms, length of implementa-
tion, and significant alterations.
TAX AND EXPENDITURE LIMITATIONS IN
CONTEXT
Many explanations have been offered for
the most recent wave of tax and expenditure
limitations—the so-called "tax revolt." Most of
these explanations suggest that Qovernment
had become too large to suit the voters, and
that the intended effect was a scaling back of
government. However, support for limitations
occurs relatively independently of the public's
desire for government services. In fact, many
surveys in states with TELs suggest that citi-
zens were satisfied with the level of public ser-
vices and often desired more, but simply
wanted to avoid paying for them.3
The local property tax was the initial tax
limitation target. This tax is highly visible and
has historically raised the ire of taxpayers.4 The
earliest efforts to limit property taxes took
place in the 1880s—a period associated with
the emergence of local home rule—and they
have continued, augmented by limitations on
state and local general revenues and expendi-
tures.
Tax and expenditure limitations impose
potentially formidable budgetary constraints.
However, with continued demands for public
services, these constraints will often cause dis-
tortions in the structure of state and local rev-
enue and expenditure systems and in the
distribution of relative levels of responsibility
for providing government services.
Currently, states impose one or more limi-
tations on the ability of local governments to
raise revenue and spend money (see Box on
next page). The most common categories of
limits are those on:
ECJ
Overall property tax rates;
Specific property tax rates;
Property tax levies;
General revenue or expenditure
increases;
TYPES OF LIMITS
Overall Property Tax Rate Limit
Sets a ceiling that cannot be exceeded without a popular vote.
Applies to the aggregate tax rate of all local governments.
Is potentially binding if coupled with a limit on assessment increases; otherwise, it
can be easily circumvented by altering assessment practices.
Specific Property Tax Rate Limit
Is the most common form of TEL.
Sets a ceiling that cannot be exceeded without a popular vote.
Applies to specific types of local jurisdictions (e.g., school districts or counties) or
narrowly defined service areas.
Is potentially binding if coupled with a limit on assessment increases; otherwise it
can be circumvented by altering assessment practices or through interfund transfers
for specific services.
Property Tax Levy Limit
Constrains total revenue that can be raised from the property tax, independent of
the rate.
Is often enacted as an allowable annual percentage increase in the levy.
Is potentially binding because of the fixed nature of the revenue ceiling, but can be
limited through diversification of revenue sources (which is its underlying intent).
General Revenue or General Expenditure Increase
Caps total revenue that can be collected and attempts to constrain spending.
Is often indexed to the rate of inflation.
Is potentially binding because of the fixed nature of the revenue or expenditure
ceiling.
Assessment Increase
Controls ability of local governments to raise revenue by reassessment of property
or through natural or administrative escalation of property values.
Is potentially binding if coupled with an overall or specific property tax rate limit;
otherwise it is easily avoided through an increase in property tax rates.
Full Disclosure/Truth-in-Taxation
Requires public discussion and specific legislative vote before enactment of tax
rate or levy increases.
Is nonbinding because a formal vote (generally a simple majority) of the local leg-
islative body can increase the tax rate or levy.
Source: Phil G. Joyce and Daniel R. Mullins, "The Changing Fiscal Structure of the State and Local
Public Sector: The Impact of Tax and Expenditure Limitations," Public Administration Review 51
May/June 1991): 240-253.
fil
Assessment increases; and
Full disclosure (truth -in -taxation)
requirements.
While none of the limits are necessarily
binding with respect to the overall revenues or
expenditures of local governments, some are
more effective than others.5 Limits on annual
increases in property tax levies, annual revenue
total or for specific types of local govern-
ments), and expenditure increases are poten-
tially the most binding because they impose a
fixed ceiling. At the other extreme, full disclo-
sure is a minimal constraint that requires only a
public hearing and a simple majority vote by
the legislative body to override and raise a
property tax levy (even if there is no tax rate
increase).
Overall limits on the combined property
tax rate levied by all local jurisdictions (e.g.,
county, municipality, and school district) and
limits on the property tax rates of specific local
governments are potentially significant and
binding if they are combined with a limit on
assessment increases. Otherwise, rate limita-
tions may be circumvented by changing
assessment practices. Likewise, limits on
assessment increases are not binding without
rate limits.
There is considerable variation in the use
of limitations (see Table 1, page 5):
36 states have a combination of limits
Arizona, California, Colorado, and
New Mexico have the most restrictive
combinations).
12 states limit overall property tax
rates.
30 states limit specific local govern-
ments' tax rates (24 limit counties; 27
limit municipalities; and 23 limit
school districts).
27 states limit local tax levies (24
limit counties; 24 limit municipali-
ties; and 15 limit school districts).
6 states limit the growth in assess-
ments.
2 states limit general revenue growth
one limits counties, municipalities,
and school districts, and one limits
only schools).
8 states limit expenditure growth (4
limit only schools, and 4 limit coun-
ties and municipalities).
22 states (at least) have some form of
full disclosure requirement (4 have no
other limitations).
4 states (Connecticut, Maine, New
Hampshire, and Vermont) do not have
limits.
There are various mechanisms to suspend
limits, ranging from simple local legislative
votes to authorization by state tax commissions
and state legislatures to popular referendums.
Limits also are applied to varying tax bases.
Most of the limits exempt long-term debt
service costs. The exemption may offer an
incentive to reclassify expenditures and shift
the revenue structure to include a higher
reliance on debt financing.
Focus OF THE REPORT
This report focuses on limits imposed on
counties, municipalities, and school districts.
Each type of jurisdiction is considered sepa-
rately because, with the general exception of
assessment limits and full disclosure provi-
sions, fiscal constraints are not applied uni-
formly. Limits on special districts and specific
functions were not considered. Limits on local
sales tax rates are not specifically included, but
they may be in overall revenue limits.
Previous examinations of TELs have
tended to neglect school districts.6 This
appears to be a significant omission, given that
school districts accounted for 37 percent of
total local expenditures in 1991.7 Limitations
on school districts, counties, and municipali-
ties are often enacted together.
Allowable Growth
The most significant structural feature of
revenue, expenditure, and assessment limita-
tions is the amount of allowable growth.
Growth may be restricted to a specific percent-
age increase. Nevada, for example, limits
county and municipal annual property tax rev-
enue increases to a flat 6 percent. The restric-
tiveness of percentage limits is determined by
general economic conditions. In periods of sig-
nificant price inflation, real revenue or expen-
diture growth may be seriously constrained.
Some limits tie allowable growth to changes in
inflation and/or population. In many cases,
growth is allowed to keep pace with inflation
to ensure sufficient resources to maintain pro-
vision of goods and services (e.g., Illinois).
Allowable growth associated with population
change is intended to accommodate additional
demands on government as a result of absolute
increases in population, but not those associat-
ed with real income increases or the effects of
changes in population characteristics.
With expenditure pressures generally
unabated and increasing, if growth provisions
are too stringent, governments may experience
increasing fiscal strain, regardless of the
absolute capacity of their potential resource
base. Yet if growth factors are relatively
relaxed, the limitation will have little effect.
Overriding Limits
Revenue and expenditure limitations
often are constructed so that only property
taxes are constrained, leaving other broad- and
narrow -based taxes as alternatives. In these
instances, local governments may turn to sup-
plemental revenue sources. In a fiscal environ-
ment that threatens to reduce government rev-
enue and spending, evading limits is a logical
strategy to sidestep (probable) reductions in
programs, service provision, salaries, etc.
Sometimes, such limitations are intended to
shift reliance to other types of revenues.
It also is common to include one or more
circumvention mechanisms, usually in the
form of voter overrides and exemptions. Voters
may authorize an "excessive" overall increase
or an increase for a specified purpose. Over-
rides typically require a simple majority,
although several states require a supermajority.
The most common limitation exemptions
include special levies (e.g., for roads, recre-
ation, mental health centers); debt service
typically general obligation bonds); court
judgments; and pension liabilities. Less fre-
quent are exemptions for home rule or charter
local governments, appeals to a state board,
and excessive increases decided by the vote of
a jurisdiction's governing body.
METHODOLOGY
The tables in this report present compara-
tive information on limitations in effect for
each state, including the original effective date
of the provision. Amendments that significant-
ly altered the limitation's structure have been
noted when appropriate dates could be deter-
mined. This information is essential for an
accurate assessment of a limit's impact, as the
effects are expected to grow over time.
A decade ago, Steven Gold called the
information available on tax and expenditure
limitations "piecemeal, scattered and of incon-
sistent quality.118 That information remains
inconsistent and often contradictory. The data
for this study were gathered through extensive
legal research (see Appendix A for legal cita-
tions), follow-up surveys of state and local
officials, and telephone conversations.
S
0
PROPERTY TAX RATE LIMITS: OVERALL AND SPECIFIC
GENERAL
Rate limits are the predominant form of
state restrictions on local property taxes. Local
governments in 33 states are affected by over-
all and/or specific tax rate limits.
HISTORICAL TREND
The specific rate limits in use in nine
states were enacted from the 1870s through the
1890s. Rate limits (in combination with debt
limits) originated as a reaction against the local
government practice of financing private enter-
prise, particularly railroad expansion, for pri-
vate benefit.9 Public demand for accountability
in government spending also has acted as a cat-
alyst for rate limits since the 1800s.
Between 1914 and 1939, seven states
adopted overall rate limits, and ten states
adopted a specific rate limit for at least one
type of local government. In 1932, negative
reaction to increasing tax levies in Michigan
led to a voter -initiated amendment to the state
Constitution that created the state's initial
limit.
The latest wave of limits started in the
1970s. Overall limits were enacted in Alabama
1972), California and Idaho (1978), and Ari-
zona (1980). Two statutory provisions
strengthened existing constitutional amend-
ments (Nevada and Washington). Although
the popularity of rate limitations waned in the
1980s, there has been an increase in activity in
the 1990s:
A 1991 voter initiative enacted Ore-
gon's overall property tax rate limit.
A 1992 constitutional amendment in
Colorado limits a district's tax rate to
that of the prior year, unless a majori-
ty of the electorate approves an
increase.
Minnesota repealed the specific rate
limit on municipalities effective fiscal
year 1992-93.
Effective 1993-94, Wisconsin's coun-
ties are limited to the FY 1992-93 tax
rate.
STRUCTURE
Overall Rate Limits
A rate limit's restrictiveness depends on
the maximum limit, definition of the taxable
base, voter overrides, exemptions, and whether
assessment increases also are limited.
Maximum authorized rates range from 0.5
percent (Class I property in Kentucky) to 3.64
percent (Nevada). A 1.0 percent aggregate
limit is imposed on all property classes in five
states, on Class III (residential) property in
Alabama, and on Class II (residential) property
in West Virginia.
The effects of the rate limit vary greatly
by state because real property valuations are
based on measures as diverse as acquisition
cost, market value, cash value (adjusting for
depreciation), and true cash value. Assessment
ratios also vary from 30 percent to 100 per-
cent.10 For example, a 1 percent rate is applied
to assessed value that is one-third of market
value in Ohio and full cash value in Arizona.
Oregon's limit is applied to real market value,
with a 100 percent assessment ratio. If property
values and rates were held equal between Ohio
and Oregon, Ohio's fractional base would
make its limit three times more restrictive.
Most states exclude debt service, but a
few states include it in rate limits. One exam-
ple is Nevada, which also has the highest
absolute rate of 3.64 percent with an allowable
increase of up to 5 percent if directed by law.
West Virginia includes county and municipal
debt service but not that of school districts.
In California, exclusions for debt service
on bonds issued after July 1, 1978, require a
two-thirds majority vote of the public. In
Washington, the limit may be exceeded to pay
debt service on bonds if approved by a three-
fifths majority vote of the electorate.
Voter -approved additional levies are a
common override mechanism (Arizona, New
Mexico, Ohio, Oklahoma, Washington, and
West Virginia). Oklahoma voters may approve
an emergency 5 mill limit for school districts, a
10 mill local support levy, and others. Exclu-
sions that allow special purpose levies outside
of the limit also are common. Arizona excludes
special districts from the limit, and Washington
excludes debt service, voter -approved increas-
es, payments on contracts, port and public util-
ity districts, conservation futures, emergency
medical service levy, and others.
Specific Rate Limits
Specific rate limits have features similar
to overall rate limits. Voter -approved increases
and special purpose levies are common fea-
tures, and almost all specific limits exclude
debt service. There also are some exceptions:
7
Nevada's 30 mill limitation on
municipalities includes debt service,
and there are no approved increases.
Texas excludes county debt service
for specified projects (e.g., dams and
roads). All municipal debt service is
included, with no special levies or
approved increases.
Kentucky counties and municipalities
must have a two-thirds majority pop-
ular vote to approve debt that exceeds
total revenue in a given year.
New York does not allow special pur-
pose levies for counties, municipali-
ties, or school districts, and includes
debt service on short-term debt for
non -capital purposes. New York is
unique in applying its rate limits
against the average full value of tax-
able real estate for the preceding five
years. This guards against an unusual-
ly large tax bill in the event of a dra-
matic increase in valuation.
Illinois and North Dakota determine a
local government's maximum rate by
population. Pennsylvania and West
Virginia set maximum rates by class
of property, and Missouri and Utah
use total assessed valuation.
School districts in Iowa, Montana,
and Nevada are subject to mandatory
rather than maximum rates. A school
district in Iowa that wants State
School Foundation Program funds
must levy 5.4 mills for its general
fund.
OVERALL PROPERTY TAX RATE LIMITS - SUMMARY PROFILE
Twelve states have overall property tax rate limitations, 9 of them in the West or South. No northeasternstatesapplytheseoveralllimits. These limitations are relatively old, with 8 (66%) enacted prior to 1978. Elevenstateslimitratesacrossmultipleclassificationsofproperty (sometimes at different rates); one applies only to resi- dential property. Debt service is excluded from the limit in 9 states (75%), special purpose and excess levies areallowedin6states (50%), and home rule jurisdictions are exempted in 2 states. Six states also have general over- ride provisions through popular referenda (one state requires a supermajority).
Occurrence Classification Exclusions Override Provisions
Prior to 1978: 8 Multiple Classifications: 11 Debt Service: 9 Popular Referenda:
1978 or After: 4 Residential Only:1 Simple Majority: 5
Special Purpose & Supermajority: I
Excess Levies: 6
Legislative:
Home Rule Exemption: 2 Additional Levies: 1
Special Purpose Districts: 1 Temporary: 2
SPECIFIC PROPERTY TAX RATE LIMITS - SUMMARY PROFILE
Specific property tax rate limitations are imposed by 30 states, and 88% of them were adopted before 1978. At least 9 states had some form of specific limitation before 1900, and 20 had them by 1950. In the Midwest, 83% of states impose specific rate limitations, followed by 76% for the West, 56% for the South, and only 33% for theNortheast. Over the last two decades, these limitations were applied most frequently to municipalities (29 states or91%). Counties were limited in 26 states and school districts in 24, while 21 states (66%) applied limitations to allthreesimultaneously. Exclusions and override provisions are common. Full or partial debt service exclusions existinatleast22states (69%). Special levies in excess of the rate limits are permitted in 19 states (e.g., salaries andpensions, fire services, capital outlays, and highways). Home rule communities are exempt in three states. In some
states, rate limits apply only to general services, operations, or particular funds. General overrides are permitted bypopularreferendain21states, with a supermajority required in at least three.
Occurrence
Prior to 1978: 28
1978 or after: 4
Scope
Units Applied to:
Counties: 24
Municipalities: 28
School: 24
States Limiting All: 21
Exclusions
Debt Service: 22
Special Levies/
Classifications : 19
Home Rule: 3
rv,
Override Provisions
Popular Referenda:
Simple Majority: 18
Supermajority: 3
Legislative: 1
17 Colorado Constitution, Article X, § 20(3)(4).
18 ACIR, State Limitations on Local Taxes and
Expenditures.
19 Research along these lines includes Helen F.
Ladd and Julie Boatright Wilson, Proposition 2
112: Explaining the Vote (Cambridge: Harvard Uni-
versity, John F. Kennedy School of Government,
1981); "Why Voters Support Tax Limitations: Evi-
dence from Massachusetts' Proposition 2 1/2,"
National Tax Journal 35 (1982): 121-147; and
Who Supports Tax Limitations: Evidence from
Massachusetts Proposition 2 1/2," National Tax
Journal 36 (1983): 256-279; Paul Courant, Edward
Gramlich and Daniel Rubinfeld, "Why Voters Sup-
port Tax Limitations: The Michigan Case," Nation-
al Tax Journal 38 (1985): 1-20.
20 Robert M. Stein, Keith E. Hamm, and Patricia K.
Freeman, "An Analysis of Support for Tax Limita-
tion Referenda," Public Choice 40 (1983): 187-
194.
21 John E. Peterson, "Tax and Expenditure Limita-
tions: Projecting Their Impacts on Big City
Finances," in Kaufman and Rosen, eds., The Tax
Revolts: The Case of Proposition 13 (New York:
Harper, 1981).
22 Ladd, "An Economic Evaluation of State Limita-
tions on Local Taxing and Spending Power,"
National Tax Journal 31 (1978): 1-18.
23 Perry Shapiro and W. Douglas Morgan, "The
General Revenue Effects of the California Property
Tax Limitation Amendment," National Tax Journal
31 (1978): 119-128.
24 Dale Bails, "A Critique of the Effectiveness of
Tax -Expenditure Limitations," Public Choice 38
1982): 129-138.
25 Howard Chernick and Andrew Reschovsky,
The Distributional Impact of Proposition 13: A
Microsimulation Approach," National Tax Journal
35 (1982): 149-170.
26 Dennis Delray et al., Fiscal Restraints and the
Burden of State and Local Taxes (Santa Monica,
California: RAND, 1981).
Roger Kemp, "California's Proposition 13: A
One -Year Assessment," State and Local Govern-
ment Review 14 (January 1982).
28 Danziger, "California's Proposition 13 and the
Fiscal Limitations Movement in the United States."
29 Carolyn Sherwood -Call, "Tax Revolt or Tax
Reform: The Effect of Local Government Limita-
tion Measures in California," Economic Notes (San
Francisco: Federal Reserve Bank, 1987).
30 Gary J. Reid, "How Cities in California Have
Responded to Fiscal Pressures since Proposition
13," Public Budgeting and Finance 8 (Spring
1988): 20-37.
31 David Merriman, "The Distributional Effects of
New Jersey's Tax and Expenditure Limitations,"
Land Economics 62 (1986): 354-361.
32 Sharon Bernstein Megdal, "Estimating a Public
School Expenditure Model under Binding Spend-
ing Limitations," Journal of Urban Economics 19
1986):277-295.
33 Lawrence E. Susskind and Cynthia Horan,
Proposition 2 1/2: The Response to Tax Restric-
tions in Massachusetts," in Lawrence E. Susskind,
ed., Proposition 2 112 (Cambridge: Massachusetts
Institute of Technology, 1983).
34 Richard J. Cebula, "Tax -Expenditure Limitation
in the U.S.—Two Alternative Evaluations," Eco-
nomic Notes (1986): 140-151.
35 These include Daphne A. Kenyon and Karen
Benker, "Fiscal Discipline: Lessons from the State
Experience," ,National Tax Journal 37 (1984): 437-
446; and Marcia Howard, "State Tax and Expendi-
ture Limitations: There Is No Story," Public
Budgeting and Finance 9 (1989): 83-90.
36 Joyce and Mullins, "The Changing Fiscal Struc-
ture of the State and Local Public Sector."
NOTES
1 James N. Danziger, "California's Proposition 13
and the Fiscal Limitations Movement in the United
States," Political Studies 28 (1980): 599-612; and
Philip G. Joyce and Daniel R. Mullins, "The
Changing Fiscal Structure of the State and Local
Public Sector: The Impact of Tax and Expenditure
Limitations," Public Administration Review 51
May/June 1991): 240-253.
z Advisory Commission on Intergovernmental
Relations (ACIR), State Limitations on Local Taxes
and Expenditures (Washington, DC, 1977); and
James Danziger and Peter Smith Ring, "Fiscal
Limitations: A Selective Review of Recent
Research," Public Administration Review 43 (Janu-
ary/February 1982): 47-55.
3 H.E. Brazer, "On Tax Limitations," in Norman
Walzer and David Chicoine, eds., Financing State
and Local Government in the 1980s (Cambridge,
Massachusetts: Oelgeschlager, Gunn, and Hain,
1981).
4 In a survey conducted annually by the Advisory
Commission on Intergovernmental Relations, the
property tax'consistently ranks among the worst, or
least fair, of major federal, state, and local taxes. It
holds this distinction jointly with the federal
income tax. During the 1970s, the property tax gen-
erally was considered worse than the income tax,
followed by a period from 1979 to 1988 when the
income tax held this distinction. The property tax
was worst again in 1989 and 1991 (see ACIR,
Changing Public Attitudes on Governments and
Taxes).
5 See Steven D. Gold and Martha Fabricius, How
States Limit City and County Property Taxes and
Spending (Denver: National Conference of State
Legislatures, 1989); ACIR, Significant Features of
Fiscal Federalism, 1992, Table 7; and Joyce and
Mullins, "The Changing Fiscal Structure of the
State and Local Public Sector."
6 Gold and Fabricius, How States Limit City and
County Property Taxes and Spending.
7 U.S. Department of Commerce, Bureau of the
Census, Government Finances: 1990-91 (Washing-
ton, DC, 1994), Table 29.
8 Steven D. Gold, "Results of Local Spending and
Revenue Limitations: A Survey," Perspectives on
Local Public Finance and Public Policy 1 (1983):
109-147.
9 ACIR, State Limitations on Local Taxes and
Expenditures; and Dennis R. Judd, The Politics of
American Cities: Private Power and Public Policy,
3rd ed. (Glenview, Illinois: Scott, Foresman and
Company, 1988).
to National Property Tax Manual (Vertex Inc.,
1991).
11 Gold, "Results of Local Spending and Revenue
Limitations."
12 Gold and Fabricius, How States Limit City and
County Property Taxes and Spending.
13 Citizens Research Council of Michigan, "Truth
in Local Property Taxation and Assessment,"
Council Comments 929 (May 1982).
14 ACIR, State Limitations on Local Taxes and
Expenditures.
15 "Proceeds of taxes" include general tax rev-
enues, proceeds from investment of tax revenue,
revenues from user fees and charges that exceed
the cost of providing the service, and year-end
unappropriated fund balances originating from tax
sources. For local governments, proceeds also
include state subvention revenue. California Tax
Foundation, Up to the Limit: Article XIII B Seven
Years Later (Sacramento, 1987).
16 California Taxpayer Association, Growth within
Limits: Reshaping Article XIII B (Sacramento,
1988).
10
NCSLnet
MFiscal
Letter: State Tax and Expendit... Page 1 of 7
al ? 14 16 nlevia, 19, M e/ kV i lll _v 10
11111111THE FISCAL LETTER Government Finance Issues in the States
The Fiscal Perspective: State Tax and Expenditure Limits
by Mandy Rafool (mandy, rafoolnncsl. orQ), NCSL Fiscal Research Analyst
Traditional Tax and Expenditure Limitations
Other Tax And Expenditure Limitations
Features of Tax and Expenditure Limitations
Have Tax and Expenditure Limitations Been_ Successful?
Stratevies to ManaLe State Tax and Expenditure Limitations
Editor's Note
FISCAL LETTER
Government spending is out of control." "My taxes are way too high." "There must be some way to
control the growth of government." Frequently uttered comments like these illustrate much of the
sentiment driving the tax and expenditure limitation (TELS) movement in the states. Tax and
expenditure limits have evolved to keep government spending in check by placing constitutional or
statutory restrictions on the amount a government entity can spend or tax its citizens. Some states
have multiple limits in place. This article provides an overview of traditional revenue and spending
limits. It also describes other methods states use to limit government's ability to increase or impose
new taxes, such as voter approval and supermajority requirements, and last, it examines the impact
limits have on state government. States particularly susceptible to any kind of tax and expenditure
limits are those states with citizen initiative procedures.
Traditional Tax and Expenditure Limitations
Traditional limits on state government are either revenue, expenditure or appropriation limits. The
restrictiveness of these limits varies considerably as there are many different ways to define and
calculate each limit. Variations make it difficult to categorize state limits, but generally, they fall into
one of four categories described below:
Revenue limits --Revenue limits tie yearly increases in revenue to personal income or some other type
of growth index such as inflation or population. Only six states use revenue limits: Colorado,
Florida, Louisiana, Massachusetts, Michigan and Missouri. The laws in each of these states provide
for the refund of excess revenues to taxpayers.
Expenditure limits --This is the most common type of state limit. Expenditure limits, like revenue
limits, are typically tied to personal income or a growth index. However, expenditure limits curb
state appropriations and are generally not as restrictive because it is easier for states to control
spending levels than to anticipate incoming revenues accurately. The impact of expenditure limits on
state government depends upon the limit parameters. In some states, like Colorado where increases
in appropriations are limited to 6 percent of the previous year's appropriations, the limit is restrictive.
But in most states, particularly those where the limit is tied to a growth index and the economy is
expanding, the limit remains high enough to have little effect. Somewhat more restrictive are
2/26/98 / / 11:32:55 AM
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expenditure limit laws with refund provisions for revenues that exceed the authorized spending level.
States with refund provisions include California and Hawaii.
Appropriations limited to a percentage of revenue estimates --This type of limit simply ties
appropriations to expected revenues. It does not establish a firm limit or tie growth to a measurable
index. Delaware, Iowa, Mississippi, Oklahoma and Rhode Island have this type of spending limit in
place.
Hybrids --States also have combined limit features, creating hybrids. For example, Oregon's spending
limit is tied to personal income growth, with a provision requiring refunds if revenues are more than
2 percent of the revenue forecast.
IE
Other Tax and Expenditure Limitations
State laws may also dictate voter approval and legislative supermajority requirements that are not tax
or expenditure limitations in the traditional sense. Such requirements can limit state revenue and
expenditure options, so they are discussed here as limitations. Often these measures are more
restrictive than traditional limits.
Voter approval requirements --This is the most restrictive type of limit since all tax increases (or tax
increases over a specified amount) must receive voter approval. Only three states have adopted voter
approval requirements. Currently, Colorado requires voter approval for all tax increases, and
Missouri and Washington require voter approval for tax increases over a certain amount.
Supermajority Requirements --Recent debate over requiring a three-fifths vote of the United States
Congress to raise taxes has rekindled interest in state supermajority requirements and how they affect
state finances. As shown in Table 1, 12 states use supermajority requirements to restrict legislative
fiscal power, with the possible addition of Nevada if approved by voters in November 1996.
Supermajority requirements dictate either a two-thirds, three-fourths or three-fifths majority vote in
both chambers to pass tax increases or new taxes.
Table 1 : State Supermajority Requirements on Legislative Tax Powers
State Adopted Referendum Legislative Applies To
or Voter Majority Required
Initiative
Arizona 1992 I 2/3 All taxes
Arkansas 1934 R 3/4 All taxes except sa
and alcohol
California 1979 I 2/3 All taxes
Colorado 1992 I 2/3 All taxes
Delaware 1980 R 3/5 All taxes
Florida 1971 R 3/5 Corporate income to
Louisiana 1966 R 2/3 All taxes
2/26/98 14 11:32:59 AM
NCSLnet Fiscal Letter: State Tax and Expendit...
Mississippi 1970 R 3/5
Oklahoma 1992 I 3/4
Oregon 1996 R 3/5
South Dakota 1978 I 2/3
Washington 1993 I 2/3
Notes to
Page 3 of 7
All taxes
All taxes
All taxes
Sales and income to
All taxes ***
Tax increases automatically sunset unless approved by the voters at the next election.
The constitution limits the corporate income tax rate to 5 percent; 3/5 vote is needed to increase
beyond 5 percent.
Tax increases producing revenue that does not exceed the spending limit must be approved by
two-thirds legislative vote; tax increases that produce revenue over the limit, must be approved by a
two-thirds legislative majority and by the voters.
Pending voter approval in November 1996: Nevada
Source: NCSL Survey of Legislative Fiscal Officers, April 1996
Features of Tax and Expenditure Limitations
States laws and constitutions prescribe various methods and formulas to determine the limits on
taxes and expenditures. These include both absolute limits on revenue and spending, and limits on
the size of revenue and expenditure increases. Expenditure or revenue growth may be tied to a
certain growth percentage as in North Carolina where the spending limit is equal to 7 percent of state
personal income. Limits also may be tied to the rate of growth in personal income or some other
index like population growth or inflation, as in Utah and Washington. Some states, like Missouri and
Michigan tie limits to a personal income ratio (total state revenues to personal income in the base
year) from a specific year, and finally, some states limit appropriations to a percentage of the revenue
estimate or forecast.
Obviously different limit characteristics promote different results. Some of the variables are listed
below, and all these factors contribute to the restrictiveness of state tax and expenditure limits.
How was the limit initiated? Was it by citizen initiative or the legislature? Generally citizen
initiated limits are more restrictive.
Is it statutory or constitutional? Constitutional amendments are usually more difficult to
change than statutes.
Is it a limit on revenues or expenditures? As previously discussed, spending is easier for state
governments to control.
What is the basis of the limit? In many cases, the base year chosen to limit expenditures --often
the late 1970s or early 1980s --was a high water mark for state spending. A high base year
makes it less likely that a limit will be triggered.
How much of the budget is limited? Often the limit only applies to the general fund. How
much of the budget does that really limit? How are earmarked funds treated?
What are the provisions for change? Most states build in flexibility by providing provisions
for emergencies or long -run changes in basic economic characteristics such as a declining
population or ongoing recession.
What are the provisions in the limit for shifting program responsibility? Can government
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entities shift programs onto one another?
How are surplus funds treated? Surplus funds in most states go into "rainy day" or other
special funds; however, a number of states require refunds of surplus revenues.
Table 2 summarizes state tax and expenditure limits.
Table 2: State Revenue and Expenditure Limitations
State Adopted Constitutional Limit Applies Nature of Limit
or Statutory to
Alaska 1982 Constitutional Appropriations Growth of population and i
Arizona 1978 Constitutional Appropriations 7.23 percent of personal i
California 1979 Constitutional Appropriations Personal income growth & p
Colorado 1991 Statutory Appropriations Appropriations limited to
1992 Constitutional Expenditures & year's appropriations
Revenue Spending limited to growth
population and inflation,
increases require voter ap
Connecticut 1992 Constitutional Appropriations Greater of inflation or in
growth
Delaware 1978 Constitutional Appropriations 98% of estimated revenue
Florida 1994 Constitutional Revenue 5 year average personal in
growth
Hawaii 1978 Constitutional Appropriations 3 year average personal in
growth
Idaho 1980 Statutory Appropriations 5.33 percent of personal i
Iowa 1992 Statutory Appropriations 99t of adjusted general fu
receipts
Louisiana 1979, Statutory Revenue Ratio to personal income i
1993 Constitutional Appropriations Per capita personal income
Massachusetts 1986 Statutory Revenue Growth of wages and salari
Michigan 1978 Constitutional Revenue 9.490 of prior year's pers
income
Mississippi 1982 Statutory Appropriations 98%- of projected revenues
Missouri 1980 Constitutional Revenue 5.64% of prior year's pers
2/26/98 H 11:33:01 AM
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Tennessee 1978 Constitutional Appropriations Personal income growth
Texas 1978 Constitutional Appropriations Personal income growth
Utah 1988 Statutory Appropriations Growth in population and i
Washington 1993 Statutory Expenditures Growth in population and i
tax increases beyond limit
approval
Source: NCSL Survey of Legislative Fiscal Officers, April 1996.
Tqz
Have Tax and Expenditure Limits Been Successful?
Traditional Tax and Expenditure Limits. Most studies conclude that state limits alone have not been
as effective in slowing down the growth of government as proponents envisioned. (They are much
more effective when combined with local limits). This is primarily due to the way they are designed
and how easily state governments can get around the limits. It is worth noting, however, that some of
the most potentially binding state limits have passed since 1990 and have not been analyzed in any
empirical studies.
Another measure of effectiveness of a tax or expenditure limits is how often the state triggers the
limit and what happens if it does. In most states, particularly those in which the limit is tied to a
growth index and the economy is expanding, the limit remains high enough to have little effect. But
2/26/98 11:33:01 AM
1996 Constitutional Revenue income
voter approval required fo
increase over $50 million
percent of state revenues
Montana 1981 Statutory Appropriations Personal income growth
Nevada 1979 Statutory Expenditures Growth of population and i
New Jersey 1990 Statutory Appropriations Personal income growth
North 1991 Statutory Appropriations 7 percent of state persona
Carolina
Oklahoma 1985 Constitutional Appropriations 12 percent adjusted for in
950 of certified revenue
Oregon 1979 Statutory Appropriations Personal income growth
Rhode 1992 Constitutional Appropriations 98% of projected revenue
Island
South 1980,1984 Constitutional Appropriations Personal income growth
Carolina
Tennessee 1978 Constitutional Appropriations Personal income growth
Texas 1978 Constitutional Appropriations Personal income growth
Utah 1988 Statutory Appropriations Growth in population and i
Washington 1993 Statutory Expenditures Growth in population and i
tax increases beyond limit
approval
Source: NCSL Survey of Legislative Fiscal Officers, April 1996.
Tqz
Have Tax and Expenditure Limits Been Successful?
Traditional Tax and Expenditure Limits. Most studies conclude that state limits alone have not been
as effective in slowing down the growth of government as proponents envisioned. (They are much
more effective when combined with local limits). This is primarily due to the way they are designed
and how easily state governments can get around the limits. It is worth noting, however, that some of
the most potentially binding state limits have passed since 1990 and have not been analyzed in any
empirical studies.
Another measure of effectiveness of a tax or expenditure limits is how often the state triggers the
limit and what happens if it does. In most states, particularly those in which the limit is tied to a
growth index and the economy is expanding, the limit remains high enough to have little effect. But
2/26/98 11:33:01 AM
NCSLnet Fiscal Letter: State Tax and Expendit... Page 6 of 7
in some states where spending increases are limited to a percentage of the previous year's
appropriation, the limit can be restrictive. In addition, a few states have provisions requiring taxpayer
refunds if the state hits the limit. California, Missouri and Oregon have had to rebate excess
revenues. Although taxpayers' share of rebates is usually small, it is an effective way to control
government growth, since to avoid paying refunds, state legislatures may reduce taxes to lower the
revenue base. When it appeared that revenues in Michigan would exceed the limit in FY 1995, the
Legislature cut state income taxes by 2 percent. In anticipation of triggering the limit in FY 1997-98,
the Colorado General Assembly passed a number of measures in the 1996 session to reduce revenues
including a child care tax credit, a reduction in the insurance tax rate and a sales/use tax exemption
on manufacturing tools. This strategy, however, can create problems in slow growth years since the
base is now at a lower level.
Voter Approval and Supermajority Requirements. Many fiscal policy experts believe that voter
approval and supermajority requirements have placed tighter constraints on state governments than
traditional revenue and expenditure limits. Requiring voter approval for state tax increases is a fairly
new practice that exists in only three states. As a result, the effectiveness of voter approval
requirements does not have much of a track record. In 1992, Colorado became the first state to
require voter approval for all tax increases and new taxes. Washington and Missouri also require
voter approval on tax increases over a specific level. A simple way to measure the effectiveness of
voter approval requirements is to look at the voter approval record. By using defeat as a measure,
one can argue that the requirement is effective when voters say no to new taxes or tax increases. This
happened in Colorado when voters rejected extending the tourism tax that supported the state travel
office and tourism promotion. Many people felt that there was no need for a tourism tax and that
they did not benefit from the revenues, so when given the opportunity, they voted it down.
An interesting observation related to the perceived ineffectiveness of tax and expenditure limits is
the number of states that have adopted supermajority requirements. As a tool to slow the growth of
government and control tax increases and spending, they are thought by many tax reformers to be
more effective than traditional limits.
But the restrictiveness of supermajority requirements ultimately depends upon the make-up of the
legislature and on the state's tax system. In states with one predominant party, it may be easier for the
majority party to get enough votes to approve tax increases. In other states, the requirement proves
very restrictive. Staff from supermajority states report that diligent consensus building by legislative
leaders is necessary to gain approval of most tax increases. States with tax systems that fail to provide
revenue growth commensurate with economic growth may have trouble coping with such
requirements.
Strategies to Manage State Tax and Expenditure Limitations
The past 20 years demonstrate that state governments have managed to live with tax and expenditure
limits and that many of the early gloom and doom prophecies have not been realized. Listed below
are several strategies that states may have used to help manage limits.
Build up the state's rainy day fund so money is available for slow growth years.
Shift responsibility to local governments if permitted.
Go to voters only in cases of emergency.
Maintain the revenue base during slow growth years by planning on one-time tax refunds
rather than reducing the revenue base permanently.
Earmark new taxes, when needed, for a popular program to encourage voter approval.
Prioritize spending and try to spend less; perhaps some government functions can be met
throup,h the private sector.
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6 11:33:01 AM
NCSLnet Fiscal Letter: State Tax and Expendit... Page 7 of 7
Index fees and increase them on a gradual basis so that there won't be a need for a large
increase at one time.
Although these strategies are not necessarily considered good fiscal policy, they are tactics to help
states manage under tax and expenditure limitations. Regardless of whether or not tax and
expenditure limits achieve the desired outcome, more than half the states have some type of limit in
place and it appears that they are here to stay. Anti-government sentiment remains strong and tax
reform crusaders are quick to promote limits as a way to tie the hands of government.
I
Editor's Note
Mandy Rafool is a Research Analyst with NCSL's Fiscal Affairs Program. This article was excerpted
from a longer legislative finance paper she authored on state tax and expenditure limitations. The full
report is available upon request through the NCSL Marketing Department at (303) 830-2054.
The Fiscal Letter
Vol. XVIII, No. 5, 1996
ISSN 0197-299XI
Fiscal Affairs Program
National Conference of State Legislatures
1560 Broadway, Suite 700
Denver, Colorado 80202
William T. Pound, Executive Director
Editors: Karen Carter, Arturo Pdrez and Mandy Rafool (editor-fiscalQncsl.org)
2/26/98 / 7 11:33:01 AM
Common Cause -- Washington Watchdog
kww April 11, 1997
VOW ,
Dear Representative:
Common Cause strongly urges you to vote against H.J.Res. 62, a
Nlony constitutional amendment to require Congress to obtain a
tr.a l X two-thirds majority vote to pass legislation which increases tax
revenues. This requirement would fundamentally damage the
principle of majority rule that is a cornerstone of our democratic
system.
The proposal would provide enormous and unjustified power to a
IRKE: minority of Representatives. One-third of the House — ---144
AGTIO Representatives — would be able to block the will of a majority of0 £' " ` Y:
Members of Congress on any matter that involved an increase in tax
revenues. As the The Washington Post said in an editorial last year,
the measure would "abandon the principle of majority rule. It
would be a huge mistake, the ultimate mortgaging of future
national welfare to present political weakness."
The Constitution gives Congress the power, by a majority vote, to
pass legislation to raise or lower taxes, to increase or decrease
spending and to make other changes in law. If a majority of
Members of either house of Congress decides not to raise taxes,
taxes will not be raised. There is no reason to amend the
Constitution simply because many Members oppose increasing
taxes in principle. The will of the majority can and should be
sufficient to decide the matter.
Further, the proposal would limit Congress' ability to deal
effectively with the federal budget deficit, particularly with
wasteful corporate welfare. As budget expert Robert Greenstein has
noted, "[t]he requirement for a two-thirds majority would apply not
only to measures to raise tax rates but also to measures to cut
unproductive tax expenditures that grant subsidies to powerful
special interests." Thus, by limiting Congress' ability to approve
tax increases, the proposal would hobble efforts to reduce or
eliminate those corporate welfare tax breaks and loopholes which,
if ended, will increase tax revenue now lost to wealthy
corporations. Congress should be searching for ways to more
vigorously attack corporate welfare benefits, not for ways to
constitutionally enshrine corporate welfare tax breaks.
The proposed amendment would also restrict Congress' ability to
react to changed economic circumstances. In a rapidly changing
economy, it is especially critical that Congress retain the flexibility
to adapt government spending and revenue to the overall needs of
Page 1 of 2
2/26/98 /g 4:43:59 PM
Common Cause -- Washington Watchdog
the nation's economy.
Amending the Constitution is a serious matter and rarely done. Yet
this resolution has been rushed through the House with minimal
opportunity for public debate -- simply to accommodate the need
for the political symbolism of a vote on April 15, the day tax
returns are due. This process in itself shows flagrant disrespect for
the Constitution.
Common Cause strongly urges you to oppose H.J.Res. 62, the
so-called tax limitation constitutional amendment, which would
cede Congress' power over taxation to a small minority of the
Congress.
Sincerely,
Ann McBride
President
Copyright 1997, Common Cause
2/26/98 / I
Page 2 of 2
4:44:04 PM
Which States Require a Supermajority Vote to ...
WHICH STATES REQUIRE A
SUPERMAJORITY VOTE TO RAISE
TAXES?
by Scott Mackey
Changes
Limits
Implications
Chart
Return to Publications Directory
Introduction
Page 1 of 3
With the recent addition of Nevada and Washington, 12 states now have constitutional provisions
requiring a "supermajority" vote to pass some or all tax increases.
Arkansas was the first state to require that tax increases be approved by a margin larger than a simple
majority. In 1934, Arkansas voters approved a constitutional amendment referred by the legislature
that required a two-thirds vote to increase "the rates for property, excise, privilege, or personal taxes
now levied." Courts have interpreted this amendment to apply only to taxes on the books in 1934, so
sales taxes and alcohol excise taxes are exempt from the requirement.
Louisiana added a supermajority requirement in 1956, as did Mississippi in 1970 and Florida in
1971. All three of these measures were joint resolutions adopted by the legislature and referred to the
voters for approval. The Louisiana and Mississippi measures apply to all tax increases. The Florida
measure applies only to bills that increase the corporate income tax above a constitutional cap of 5
percent.
Changes Brought By Citizens
The supermajority restrictions approved in the remaining eight states can be characterized as "tax
revolt" measures. Restrictions in Arizona, California, Colorado, Nevada, Oklahoma, South Dakota
and Washington were approved by voter initiative. Only in Delaware, which requires a three-fifths
majority, was the measure referred to the voters by the legislature. California's "Gann Amendment,"
passed in 1979, was a continuation of the tax revolt that began in 1978 with the passage of
Proposition 13. South Dakota's restriction also passed during the height of the'78 tax revolt. It
applies to sales, income and property taxes. However, since the state has no personal or corporate
income taxes, and property taxes are levied locally, the restriction applies only to the general sales
tax.
Of the measures passed this decade, Colorado's restrictions are the most severe. The Colorado
legislature may pass an "emergency" tax increase with a vote of two-thirds of both houses. However,
the tax increase will automatically sunset 30 days after the next general election unless voters decide
2/26/98
0?, 0 4:47:53 PM
Which States Require a Supermajority Vote to ... Page 2 of 3
to make it permanent.
s TR
Limits on Select Taxes
In addition to supermajority requirements, five states have constitutional prohibitions against certain
taxes, or constitutional language that limits or otherwise restricts legislative consideration of tax
changes. The Florida and Nevada constitutions prohibit the legislature from enacting a personal
income tax. Wyoming's constitution requires that any income tax approved by the legislature provide
a full credit for all other taxes paid; this restriction essentially nullifies raising any revenue by an
income tax. Louisiana's constitution prohibits the legislature from increasing income tax rates or
changing exemptions or tax bracket amounts. This provision has been in effect since 1934 when the
state first adopted an income tax. Michigan's constitution sets the sales tax rate at 6 percent, and
prohibits the legislature from taxing prescription drugs or food purchased for home consumption.
i'TOR
Political and Fiscal Implications
Supermajority requirements for tax increases can strengthen the minority party in states where such
votes are needed to pass a tax increase. In Arkansas, Louisiana and Mississippi, however, the
majority party traditionally has had more than enough votes to approve tax increases along a party
line. Staff from supermajority states report that diligent consensus building by legislative leaders is
necessary to gain approval of most tax increases.
Constitutional restrictions can affect the balance of tax sources by making it far easier for the
legislature to raise one state tax more than another. It also limits a legislature's ability to undertake
reforms that address tax balance or other issues. Florida and Louisiana, for example, rely more on
sales taxes and much less on income taxes than the average state, particularly if local sales taxes are
included.
The potential spread of supermajority requirements is probably limited to the 24 states, mostly in the
West, with the voter initiative process. They are just one of a number of "tax revolt" measures that
may be favored by anti -tax or anti-government groups. The passage of five new supermajority
measures since 1992 may lead such groups to seek their passage in the 12 other initiative states
without such restrictions.
Supermajority Requirements & Other Constitutional
Restrictions on Legislative Tax Powers
Referendum Legislative
Year or Voter Majority
State Adopted Initiative Required Applies to
Arizona 1992 I 2/3 All taxes
Arkansas 1934 R 3/4 All taxes except s
California 1979 I 2/3 All taxes
Colorado 1992 I 2/3 All taxes*
Delaware 1960 R 3/5 All taxes
Florida 1971 R 3/5 Corporate income t
2/26/98 4 /
4:47:55 PM
Which States Require a Supermajority Vote to ... Page 3 of 3
Louisiana 1966 R 2/3 All taxes
Mississippi 1970 R 3/5 All taxes
Nevada 1994 I 2/3 All taxes
Oklahoma 1992 I 3/4 All taxes
South Dakota 1978 I 2/3 Sales and income t
Washington 1993 I 2/3 All taxes***
Tax increases automatically sunset unless approved by the voters at the next e
The constitution limits the corporate income tax rate to 5t; 3/5 vote needed t
Tax increases producing revenue that exceeds the revenue limit must be approve
About the Author: Scott Mackey is a program principal with NCSL's Fiscal Affairs Program in
Denver.
2/26/98 07 V? 4:47:59 PM
Westchester Today: News Page 1 of 1
O'Rourke presents bill requiring two-thirds vote to hike tax
By David McKay Wilson
OGannett Suburban Newspapers
Westchester County Executive Andrew O'Rourke yesterday submitted a bill requiring that county
legislators muster a two-thirds vote in order to increase county property taxes.
He made the announcement at a White Plains news conference that was attended by three
Republican county legislators. It came two months after O'Rourke said in his State of the County
address that he would submit the proposal so it could be put on the November ballot.
It should be harder to raise taxes," O'Rourke said. "And we should leave that decision up to the
people of Westchester County."
Currently, a majority of nine of 17 legislators is needed to increase property taxes. The bill would
require that 12 of 17 legislators approve an increase. O'Rourke said that over the past 25 years, on
only three occasions had the board passed tax increases with less than 12 votes.
To qualify for the November ballot, the proposal must first pass the county Board of Legislators by
early August. To come for a board vote, it must be signed out of the Legislation Committee, which is
chaired by Legislator Thomas Abinanti, D-Greenburgh.
Abinanti yesterday dismissed the proposal as a "gimmick that would be nothing but a blueprint for
gridlock. While I believe in minority rights, in our system, the majority rules."
He said that O'Rourke retains the right to line -item veto any addition to the budget and he can only
be overridden with a two-thirds vote of the board. He noted that O'Rourke had served as a county
legislator from 1974 to 1982 before becoming county executive.
Every tax increase over the past 22 years has been an O'Rourke tax increase," Abinanti said.
Which one of those tax increases does he think was a mistake?"
Legislator Louis Mosiello, R -Yonkers, who was at the news conference, had campaigned for the
super -majority vote during last fall's campaign.
This fulfills a a pledge I made to the voters," Mosiello said. "It's a 100 percent win for the taxpayers
of Westchester County."
Return to Westchester Today Home Page
2/26/98 pZ J 4:34:52 PM
Open space bill to test two-thirds rule Page 1 of 2
Nevada Appeal news Wednesday, February 26, 1997 10:25 AM
Open space bill to test two-thirds rule
By Kelli Du Fresne
A new law requiring a two-thirds vote of the Legislature for tax increases may make the road toward
enactment of Carson's quarter -cent sales tax increase a rugged one.
Supporters of the increase hope the Legislature will enact the increase since it was approved by
voters in November.
This may be the first piece of legislation to test the two-thirds vote requirement for a tax increase,"
said Assemblyman Mark Amodei, R -Carson City, who is sponsoring the bill in the Assembly. "I
think that since it was voter approved, it puts it in a positive light."
Carson voters approved a quarter -cent sales tax increase to fund parks and recreation improvements,
open space acquisition and maintenance of park facilities, but implementation of the tax is in the
hands of the Legislature.
Carson Mayor Ray Masayko said, "It's received a vote of the people. I don't think the members of the
state Legislature are going to reject it, two-thirds majority notwithstanding."
At the same time Carson residents agreed to fund park improvements, voters statewide approved
Question 11, which amended the Nevada Constitution to require a two-thirds vote of both houses in
the Legislature to approve tax increases.
That means the proposal must be supported by 14 of 21 senators and 28 of 42 Assembly members.
Masayko said the city is working with the legislators to let them know the tax was approved by
voters.
It's to everyone's advantage to pursue the two-thirds majority," Masayko said. "The rules of
engagement have changed. The imposition of any taxes requires the supermajority. We want to go
overboard making sure we obey the will of the people of the state of Nevada."
The so-called Quality of Life bill is being written by the Legislative Counsel Bureau. Last week,
Assembly Speaker Joe Dini, D-Yerington, put in a request to hurry the process. On Tuesday,
Amodei said the bill was not written yet, but he still hopes to be able to introduce the bill this week.
Bill introductions are heard in the Assembly on Mondays, Wednesdays and Thursdays.
Amodei earlier thought the tax would be implemented by changing Carson City's charter, giving the
Carson City Board of Supervisors the power to enact the tax.
That may be off now," he said. "It sounds like the charter amendment is not accurate."
The bill will go to the taxation committee after it is introduced. Supporters hope lawmakers pass the
tax by the end of March so collections can begin July 1.
City Finance Director Mary Walker said she is not concerned about winning legislative approval for
the tax increase.
We want to follow the two-thirds requirement," she said. "We want it to apply. We feel with the
voters approving it we should not have a problem passing it through the Legislature."
2/26/98 a J/ 4:38:42 PM
Open space bill to test two-thirds rule Page 2 of 2
The tax increase is expected to raise $1.5 million. Plans call for using 40 percent of the revenues for
park improvements, 40 percent for open space acquisition and 20 percent for maintenance of any
new park facilities built using the tax monies.
In addition to Amodei, city officials are asking assemblymen Dini, Pete Ernaut, R -Reno, and Lynn
Hettrick, R-Gardnerville, to co-sponsor the bill.
Before the tax increase is enacted, the governor must also approve it.
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2/26/98
o25" 4:38:42 PM
City Section - Thursday, November 20, 1997 Page 1 of 2
Following the failure of Measures H and I in the Nov. 4 consolidated city elections, Davis
citizens have been forced to realize that democracy in America does not always mean that
the majority prevails.
As a result of Proposition 218, which passed in November 1996, the political system
requires that more than a majority of voters approve a ballot measure. The proposition called
for certain taxes, fees and assessments proposed by local governments to receive a
two-thirds, or "super majority" approval.
Measure I, the Parks Preservation Tax, and Measure H, the school construction bond, both
appeared on this month's ballot requiring two-thirds voter approval for passage.
Specifically as a result of the "super majority" rule, both measures failed because a little
more than one-third of the voters opposed them. Measure I, for example, garnered the
majority of the votes, 65.5 percent, though failed because it was shy of the two-thirds
majority requirement.
Davis Mayor Lois Wolk, a supporter of both measures, said the "super majority" rule is
undemocratic.
The rule) allows the minority to determine the resources of the community," she said.
In contrast to Wolk, Shneor Sherman, chairperson of the Committee for Efficient
Government, an organization that campaigned against Measure I, said the "super majority"
rule does not interfere with the democratic process.
What does it take to amend the Constitution of the United States?" he asked, commenting
that a Constitutional amendment requires approval from two-thirds of the House of
Representatives, two-thirds of the Senate and three-quarters of the states.
We don't have majority rule changing something like the Constitution," Sherman said.
Sherman added that he believes it is important for tax measures to require a "super majority"
approval.
What we have said in this country is that something important requires more than a
majority," he said. "Taxes are important enough to require a two-thirds majority."
2/26/98 ;14 11:45:39 AM
City Section - Thursday, November 20, 1997 Page 2 of 2
Wolk said she disagrees. Tax measures, she asserted, should not have the same standards as
the Constitution.
The constitution of a country is very different than teaching swim lessons at a park," she
said, alluding to impacts that the failure of Measure I will have. Proponents of the measure
have said that the failure of the measure may spark program and staff cuts.
UC Davis political science professor Larry Peterman said that although under Prop. 218
majority does not rule, in such instances, the "super majority" rule is, in fact, democratic.
We have the same thing on the national level in some cases," he said, explaining that
presidential vetoes require two-thirds of the Congress to overturn. "Majority does not rule all
the time."
Peterman added that the rule of the majority is often not where the problem lies, as in the
recent election "only a third of the electorate voted."
Proposition 13, which was passed in 1978, ceased the ability of school districts to apply for
local bonds. In 1986, Proposition 146 established the two-thirds majority from voters for
school district bonds.
Because of this "super majority" requirement, Wolk said many communities no longer
attempt to put measures such as I and H on the ballot.
Most communities don't try to put school bonds on the ballot," she said.
Wolk said that California schools have deteriorated since Prop. 13's "super majority"
requirement for school bonds.
California) schools are some of the worst in the nation," she said. "It looks like services are
next."
Sherman said the voice of the minority suggests that issues need to be given a second look
by governing officials.
If more than a third of the people don't want something, I think we should rethink it," he
said. "I think that's fair."
2/26/98 J 7 11:45:46 AM
The Case for Constitutional Tax Limitation
AMERICANS F 0
POLICY B
O T A
Page 1 of 13
X R E F O R
RIE
Growth, Prosperity, and Honest Government. The Case for
Constitutional Tax Limitation
James H. Perry[*]
TABLE OF CONTENTS
INTRODUCTION
I REQUIRING A TWO THIRDS MAJORITY OF CONGRESS
A Requiring a Two -Thirds Majority of Congress for All Tax Increases is the Best Method for
Limiting Tax Increases.
B Two Alternative Ways to Implement a Supermajority.
1. Parlimentary point of order.
2. Adoption of legislation requiring tow -thirds support of all tax increases.
C. The Tax Limitation Amendment
D. Two -Thirds is Superior to Other Percentages.
1. Two-thirds is the percentage used throughout the constitution.
2. Many states mandate a supermajority vote of at least tow thirds for an increase in taxes.
3. Two-thirds is a higher standard.
II THE IMPORTANCE OF TAX LIMITATION UNDER THE SUPERMAJQRITY PLAN
A Without Supermajority Politicians Are Biased in Favor of Tax Increases.
III. TAX LIMITATION PROMOTES GROWTH
IV. TAX LIMITATION IS GOOD GOVERNMENT POLICY
V. TAX LIMITATION IS GOOD ECONOMIC POLICY
A. Growing Government Equals Growing Taxes
B. Too Much Government Spending Harms the Economy
C. Increases GNP
D. Tax Increases Lead to Less Government Revenue
2/26/98 A v 11:18:14 AM
The Case for Constitutional Tax Limitation Page 2 of 13
VI A TWO-THIRDS SUPERMAJORITY REOUIREMENT FITS WITH THE SPIRIT
OF THE CONSTITUTION
A The Constitution Allows For Supermajority Voting
B The Founding Fathers Embraced the Idea of Two-thirds Supermajority Votes on Important
Policies. -
C Congress Historically Utilizes Supermajority Voting Requirements.
1. The first 100 years.
2. Twentieth Century.
a. The House of Representatives.
b. The Senate.
VII REQUIRING A SUPERMAJORITV IS AN IDEA EMBRACED AROUND THE
WORLD.
CONCLUSION
Appendix A
Appendix B
INTRODUCTION
Senator Jon Kyl (R -AZ) and Representatives Joe Barton (R -TX) and John Shadegg (R -AZ)
have introduced in the United States Congress a Tax Limitation Amendment (hereinafter
TLA") to the U.S. Constitution, requiring a two-thirds supermajority for any new tax or
increases in existing taxes. [1] On April 15th, 1996 the House TLA, in its first attempt at
adoption, received 243 favorable votes. L2] Speaker of the House Newt Gingrich (R -GA) has
promised another vote on the House TLA for April 15, 1997. Senator Kyl's and
Represeritative Shadegg's effort to secure constitutional tax limitation for U.S. taxpayers is a
natural outgrowth of their prior efforts to amend the Arizona State Constitution to require a
two-thirds vote of the state legislature for any tax increases.
I. Requiring a Two Thirds Majority of Congress for all Tax Increases Is the Best Method
for Limiting Tax Increases
A. Supermajority Voting is the Best Way to Stop Tax Increases
Under the current rules, previous Congresses have been incapable of restraining their taxing
and spending. The empirical evidence is compelling. The United States runs a chronic budget
deficit because Congress spends too much, not because it taxes too little. During the post-war
era, while total government revenues as a share of Gross Domestic Product deviated little
from approximately 19 percent, spending has risen continuously, averaging 18 percent in the
1950s, 19 percent in the 1960s, 21 percent in the 1970s, to a range of 22% to 25% over the last
ten years. L3]
Congress has historically managed to avoid spending cuts and increased tax revenue by some
maneuver to provide political cover. For instance, in both 1990 and 1993 Congress voted to
2/26/98 o2.9 11:18:18 AM
The Case for Constitutional Tax Limitation Page 3 of 13
raise taxes in the guise of omnibus budget laws that were described as deficit reduction acts.
4] In the 1970s government tax receipts grew rapidly as inflation pushed workers into higher
tax brackets and Congress did little to interfere. Workers were earning more money that was
worth less when adjusted for inflation. The tax code, however, did not take this into effect.
Instead, it taxed Americans as if they were earning wages at pre -inflation levels. The few
reductions in tax rates during this time did little to compensate for inflation. Additionally,
dependent child and personal exemptions were not increased. Consequently, workers were
earning less but were being taxed at a higher rate. In effect, American taxpayers had their
taxes increased without Congress making any overt decision and thus without assuming any
direct responsibility for the fact of increased taxes. [5]
Because Congress is unable to make small spending cuts it is forced to raise revenue by
enacting targeted tax increases. Often, these piecemeal tax increases are the most damaging.
Examples of their damaging effects are numerous. The eroding value of the dependent child
exemption hurt families by subtly taking more income which would better be used for family
purposes. Increases in the capital gains tax and lengthening of the depreciation of structures in
the Tax Reform Act of 1986 destroyed real estate values and substantially contributed to the
severity of the savings and loan collapse in the late 1980s — a collapse that cost US taxpayers
hundreds of billions of dollars. Finally, the luxury tax implemented under the Omnibus
Budget Reconciliation Act of 1990 destroyed the yacht building industry in the U.S. [6]
B. Two Alternative Ways to Implement a Supermajority
1. Parliamentary Point of Order
There are several mechanisms which Congress may use to require a supermajority vote for the
passage of tax increases. One way is the adoption of a parliamentary point of order. Under
such rule, any member of Congress would be entitled to raise a point of order with the Speaker
of the House or President of the Senate when a bill or amendment is believed to raise taxes.
Provided the bill was interpreted by the parliamentarian as raising taxes, the point of order
would lie, requiring a supermajority to approve the legislation. The adoption of a rule
allowing a point of order is exactly what the House of Representatives did on the very first
day of the 104th Congress when it adopted, by a vote of 279 to 152, House Rule XXI with its
requirement that federal income tax rate increases shall not be "considered as passed" unless
agreed to by three-fifths (sixty percent) of the Members voting. [7] This rule, however, does
not provide permanent tax limitation. Such a rule can be adopted or repealed by majority vote
at the start of each new Congress. [8] Consequently, point of order tax limitation will be
subject to the vagaries of the Congressional balance of power. As power shifts between the
parties during elections or, even during a session due to special elections and party switchers,
there is a danger that point of order tax limitation would easily be overturned. Further, under
House rules, a rule triggering a special point of order can be waived whenever political
considerations favor increasing government revenues. [9] Taxpayers will be protected from
these temporary political passions by the TLA because a constitutional amendment requires
the same difficult measures for repeal as it does for adoption — passage by two-thirds of both
the House and the Senate, and then ratification by three-fourths of the states.
2. Adoption of Legislation Requiring Two -Thirds Support of all Tax Increases
Congress could, if it choose to do so, pass legislation that requires a two-thirds vote for
adoption of tax increases. However, in previous cases where Congress has required that
certain measures be adopted by supermajority vote, it has circumvented such requirements in
2/26/98 30 11:18:20 AM
The Case for Constitutional Tax Limitation Page 4 of 13
order to avoid an actual vote. This is usually accomplished by hiding the tax increase measure
in a comprehensive piece of legislation. In both the 1990 Omnibus Budget Reconciliation Act
OBRA 1990) and the 1993 Omnibus Budget Reconciliation Act (OBRA 1993) tax increases
were tucked into a wider package of deficit reduction provisions. Consequently, members of
Congress were able to raise taxes by claiming they were actually voting for popular deficit
reduction. Additionally, closed rules limit the opportunities of representatives to amend a
given bill. Their use allows members of Congress to claim to favor policies and profess that
they were unable to vote for them because the rule did not allow them to amend the bill.
These deceptive voting practices severely injure the functioning of representative democracy.
Voters find it difficult to make informed judgments about what their representatives are
actually doing. Informed judgments that are the heart of the periodic electoral review that the
Founding Fathers had in mind when they provided for the direct election of House members
by the people. The widespread use of hidden procedures by members of Congress strongly
suggests that Members perceive they have something to hide.
Legislative supermajority tax limitation carries with it the same problems as a rule triggering a
point of order. With each new Congress, or even in a sitting Congress with special elections or
party switchers, the tax limitation law would once again be subject to repeal. Consequently,
legislative tax limitation offers no permanent protection for the taxpayer. On the other hand, a
constitutional requirement that any tax increase be put to a simple straight up -or -down, yes or
no, supermajority vote is easier to enforce due to the transparency of the process. Members of
Congress will be unable to maneuver around the constitutional requirements simply to provide
themselves with political cover.
C. The Tax Limitation Amendment
The Tax Limitation Amendment was introduced in the House of Representatives by
Representatives Joe Barton (R -TX), John Shadegg (R -AZ) and in the Senate by Senator Jon
Kyl (R -AZ). [10] The Main provisions of the TLA states that "[a]ny bill to levy a new tax or
increase 'the rate or base of any tax may pass only by a two-thirds majority of the whole
number of each House of Congress."11 ] 4,
D.Two-Thirds is superior to other percentages.
Requiring an affirmative vote of two-thirds of all Members of Congress is superior to other
proportions, such as three-fifths.
1. Two -Thirds is the Percentage Used Throughout the Constitution
A requirement of two-thirds is consistent with constitutional supermajority voting
requirements. In ten instances the Constitution mandates supermajority voting requirements.
12] Each of these requirements reflects the thoughtful deliberation by the Framers and
Amenders of the Constitution. Each serves a purpose and each illustrates the capacity of the
Constitution's architects to impose such requirements on Congress where they were deemed
necessary or useful. When it was appropriate in the political environment of the 1780s to
prescribe a specific numerical voting requirement, the Constitution supplied one. The
Constitution is a living document, adaptable to modern problems. It is clear that if the Framers
2/26/98
J/ 11:18:20 AM
The Case for Constitutional Tax Limitation Page 5 of 13
of the Constitution had been faced with runaway deficits and massive government in the
absence of a compelling national emergency, they would have required a supermajority for tax
increases. In the present environment of high taxes and the need for either sharp cuts in
government spending or increases in revenue, politicians in Washington, D.C., cannot be
trusted to protect the pocketbooks of Americans without a requirement that there be broad
support for any tax increase.
2. Many States Mandate A Supermajority Vote of at Least Two Thirds For an Increase in
Taxes
States around the country have been forced to reform their budgeting and tax policies due to
their own deficit spending. Many states have been successful in trimming their deficits
without raising taxes. [13] The method used by the most successful states, in conjunction with
state balanced budget laws or amendments, has been supermajority tax limitation laws and
spending limitation laws. One third of all Americans live in a state with supermajority
constitutional tax limitation. In most of the states with supermajority requirements the idea of
requiring a greater than fifty percent vote of the legislature to increase taxes grew out of the
tax revolt movement and the initiative process. [14] These states offer a successful model for
the Federal Government's budget and tax reform efforts.
A requirement of at two-thirds is the percentage used in most of the states requiring
supermajority approval of tax increases. [15]
Two-thirds is the percentage used in most of the supermajority initiatives which were on
the 1996 ballot and those likely to be on the 1998 ballot. [16]
Eighteen states in 1995 and 1996 introduced legislation that proposed supermajority
requirements for tax increases. [i 7]
3. Two -Thirds is a Higher Standard
Two-thirds is a much higher standard which affords superior protection. It would require 290
votes in the House and 67 in the Senate. Consequently, any tax measure that musters the
required two-thirds vote will obviously enjoy wide -support from all political parties, and
among the people generally. [18] Four of the last five major tax increases were passed with
less than a two-thirds supermajority. [19] These new taxes added $666 billion to the tax bill of
the American taxpayer.
II. The Importance of Tax Limitation Under the Supermajority Plan
A. Without Supermajority Politicians are Biased In Favor of Tax Increases
Presidents for years have stated that one of their preeminent goals was to balance the federal
budget. [L20] Unfortunately, this noble sentiment ran into one Congress after another that was
addicted to deficit spending in order to appease their special-interest constituencies and
effectively buy their way to re-election. Most responsible politicians now agree that the U.S.
must balance its budget. However, there are countless plans for doing so. Many plans put
forward by those "formerly" addicted to deficit spending propose increased federal revenues.
In their view, the simplest way to increase federal revenues is to increase taxes. Whether it is
an upward revision of tax brackets, user fees, elimination of deductions or increased
investments," the bottom line is that many in Congress believe they cannot balance the
2/26/98
3A 11:18:20 AM
The Case for Constitutional Tax Limitation Page 6 of 13
federal budget without resorting to tax increases. In fact, while a member of Congress in 1992,
former White House Chief of Staff Leon Panetta testified in favor of a balanced budget act
which mandated automatic tax increases! 21 ]
There is no correlation between increased taxes and lower deficits. The fiscal history of the
U.S. illustrates this point. In fact, data suggests that an increase in taxes of $1.00 actually leads
to $1.59 of new spending. [22] Throughout the history of the U.S. the tendency of Congress to
spend additional taxes instead of using them to reduce deficits has continually increased. In
the first decades of the nation, tax increases were associated with declines in the federal
deficit. In the Twentieth Century, increases in taxes have resulted in higher deficits. [23]
Much of the increase in deficits and tax increases can be associated with the political
advantages associated with new spending. When politicians allocate government resources,
they seek the highest political return. [24] There is a bias in favor of tax increases to pay for
government -delivered benefits that go to relatively few people. These people come together as
special interests to effectively lobby Congress. Taxes, on the other hand, are spread among
many millions of people across the country who find it very difficult to band together as an
effective interest group. 25] Without constitutional tax limitation, methods such as Leon
Panetta's automatic tax increases would likely gain widespread support from special interest
groups.
Many politicians opposed to the TLA maintain that the solution to runaway spending is not to
amend the Constitution, but to simply enact balanced budget legislation. This is impractical.
Using this approach to deficit reduction many of these same lawmakers voted for record tax
increases in 1990 and 1993, [26] effectively eliminating any tax relief enjoyed in the 1986 tax
reform legislation. The result: the deficit, which was $152 billion and falling when President
Ronald Reagan left office in 1989, is projected to rise every year into the foreseeable future.
27]
With a balanced budget law or amendment without a supermajority requirement there will be
a bias towards increasing taxes as a means of complying with the law. Raising taxes presently
only requires a simple majority vote. Weak amendments which require a supermajority to run
a deficit, but only a simple majority to raise taxes make it easier to raise tax rates than to
borrow. In effect they create a tax trap. If you require a supermajority vote for borrowing
money and increasing the debt ceiling you must require the same mechanism for increasing
taxes. You can hear the politicians now saying how they didn't want to do it, but the
Constitution made them raise your taxes. [28] Instead of reflexively raising taxes to comply
with the law, Congress should be compelled to reduce spending as a means of balancing the
budget. +
III. Tax Limitation Promotes Growth
Available data show that the concept of requiring supermajority vote helps in the battle to
lower taxes. Twelve states presently have some form of supermajority requirement for tax
increases. [29] Nine of those twelve states require a supermajority of at least two-thirds. [30]
In ten of those twelve states, taxes as a proportion of personal income have actually declined
two percent. [31] In states without a supermajority requirement taxes as a proportion of
personal income have risen two percent. Thus, there is a difference of four percent in tax
burdens in those states with supermajority tax limitation requirements. [32] What has
2/26/98 3'? 11:18:20 AM
The Case for Constitutional Tax Limitation Page 7 of 13
happened in supermajority states is that lawmakers are required to reach broad consensus
before enacting tax increases. The supermajority forces state lawmakers to seriously consider
spending priorities before automatically resorting to tax increases, and makes them more
accountable to their taxpaying constituents. [33]
Not only do supermajority requirements lead to lower tax burdens at the state level, they have
resulted in a reduction in overall state government spending. In states that require
supermajority approval for tax increases, spending has increased by two percent versus an
increase of nine percent in states without the requirement. A differential of seven percent
equals significant reductions in government spending and taxation. [34]
IV. Tax Limitation Is Good Government Policy
For over fifty years, concentrated and vocal interest groups have been able to secure costly
benefits for themselves that are paid for by the widely -scattered majority of taxpayers. Due to
its far-flung nature, the taxpaying majority is legislatively ineffective in stopping the grants of
federal government largess. A constitutional amendment mandating a two-thirds affirmative
vote of Congress to increase taxes or eliminate deductions will improve the legislative process
by making the passage of these expensive benefits harder to support. Requiring an affirmative
Congressional vote for an increase of the tax burden will provide a "bright -line" test that all
federal legislators must take before they can raise the tax burden of the U.S. people. When
specialized interest groups seek a government benefit they will have to persuade a much larger
group of legislators to support their handout. Legislators who represent the taxpayers who will
pay the bill will have an easier time defending their positions and stopping the continued
excess taxation of the American people. No longer will they be able to go home to their states
and districts and say that they were compelled to raise taxes because the increase was attached
to some monumentally important bill which required passage. Nor will they be able to claim
that the Constitution mandated a tax increase. The excuse that "my hands were tied" will no
longer be acceptable. All members of Congress will have to live, govern, and run for
reelection on their voting record regarding tax increases - - voting records for all to see and to
compare:
2/26/98
V. Tax Limitation is Good Economic Policy
A. Growing Government Equals Growing Taxes
For many years it was widely accepted that economic and societal ills could be cured by
increasing the role of government. Increasing the size of government was thought to lead to
higher levels of prosperity. Throughout the Twentieth Century the size of government
spending relative to Gross National Product (GNP) has continually increased. Government
spending has increased from ten percent of GNP during World War I to almost forty percent
in the 1990s. [35] Total government spending per capita (using 1990 dollars) has also rapidly
increased from $331 per American in 1900 to over $8,000 today. [36] Per household,
spending has grown from $1,651 in 1900 to over $23,000 today (in 1990 dollars) [37] These
figures clearly show that government grew larger in both absolute and relative terms.
While the size of government was increasing relative to GNP, the tax burden felt by
Americans rose at a similar pace. The marginal tax rate increased from one percent on income
over $300,000 in 1913 (1993 dollars) to almost forty percent on incomes over $250,000 in
3l/
11:18:21 AM
The Case for Constitutional Tax Limitation Page 8 of 13
1995. During the interim years between 1913 and 1995 the top tax rate has fluctuated wildly.
However, over time it has increased. [38]
The ever increasing tax burden took more and more of American wages. The individual share
of federal taxation has increased from taking one of every twelve dollars earned in 1890 to one
of every three dollars earned in 1990. During the same period per capita federal taxes rose
from $110 to $4,000. [39] While the tax burden greatly increased as government spending
grew to take more and more of the nation's wealth, increased taxes to finance growth actually
lead to even higher government spending. It has been estimated that $1.00 of new taxes
generates $1.59 of new spending. [40] +
B. Too Much Government Spending Harms the Economy
All government spending extracts wealth from the private sector by either taxing or
borrowing. The larger government becomes with its increased spending the more severe the
taxing and borrowing. High borrowing crowds out private investment, thereby reducing
production, capital formation, and economic growth. High tax rates reduce the incentive to
work, save, and invest. Since the mid-1970s scholarly study has been done on the appropriate
size of government for the United States and the rest of the world. There is now overwhelming
evidence that government taxing and spending is beyond an optimal point. Social welfare and
economic growth would be maximized if government revenue was one-quarter or less of gross
national product (GNP), in contrast with its present level of more than one-third of GNP. [41 ]
Beyond this point any resources consumed by the government impose more costs on the
economy than the benefits they provide. [42] Conversely, for every $1 of federal spending
growth curtailed, the private sector will expand by $1.38 in the same year. 43] Over seven
years economic output would be $2.45 larger for each dollar of federal spending restraint. [44]
If the tax burden had been at the optimal rate since World War II economic growth would
have averaged about two percent higher per year and the average American family would have
about twice as much real income as it actually has today. [45] +
C. Increased GNP
From the time that government spending and its companion high tax rates exceeded the
optimal point, more and more American resources have been devoted to less productive uses.
The U.S. economy has sacrificed $2 of income for every $1 of tax paid to finance government
spending beyond the optimal level. [46] If the U.S. had been spending at its optimal rate,
between fifteen and twenty-five percent of GNP since the end of World War II, real GNP in
1989 (in 1993 dollars) would have been $13.6 trillion instead of $6.2 trillion. [47] The average
American family would have twice as much real income as it has today. [48] +
D. Tax Increases Lead to Less Government Revenue
Perversely, tax increases also lead to a reduction in the tax revenue collected by the Treasury
and stifle economic growth. Adam Smith remarked that tariff rates beyond a certain level
became self-defeating because they reduced imports and tariff revenue. The Economic
Recovery and Tax Act of 1981, which sharply cut income tax rates, boosted actual tax
collections by stimulating economic growth. Revenues soared from $517 billion in 1980 to
over $1 trillion by the end of the decade. 49] The possibility exists that if taxes were to be
raised in the future to support increased government spending, or to allegedly eliminate the
deficit, they would strangle government revenues and actually increase the United States' debt
2/26/98 J%r 11:18:22 AM
The Case for Constitutional Tax Limitation
problems.
Page 9 of 13
Between 1949 and 1989 federal, state, and local governments collected a total of $43.5 trillion
in taxes (1993 dollars). [50] However, if the tax rate had been limited to 22.9 percent of GNP,
governments would have collected a total of $55.1 trillion.51 ] At this rate governments
would have had enough revenue to fund all spending programs enacted without any public
debt! [52] Higher tax rates also discourage work, production, savings and investment.
Consequently, there is ultimately less economic activity to tax. The 1993 Clinton tax increase
caused taxpayers to reduce their taxable incomes by nearly $25 billion. [53] Taxpayers
reduced their taxable income by saving less, investing less and creating fewer jobs.
Constitutional tax limitation will force government spending to fall and protect taxpayers from
ever-increasing tax rates. The alternative is unacceptable; increased government borrowing
and an ever growing public debt. With a balanced budget amendment the government will be
forced to set spending levels in accordance with its actual revenues. By constitutionally
mandating that any increase in taxes must receive the supermajority support of Congress, it
will be more difficult to raise taxes to fuel higher government spending. Consequently, over
time, the level of government spending will fall to its optimal level. This will result in
increased growth in both personal incomes and government revenues as the economy expands.
t
VI. A Two -Thirds Supermajority Requirement to Raise Federal Taxes Fits With The Spirit
of the Constitution
A. The Constitution Allows for Supermajority Voting
There is nothing in the United States Constitution which requires that legislation be passed by
a simple majority vote of Congress. The Presentment Clause states that
e]very bill shall have passed the House of Representatives and the Senate
before it becomes a Law, be presented to the President of the United States....
54]
The Presentment Clause does not specify a proportion necessary for passage. All bills
passed" does not mean passed by a majority of a quorum of each House. Consequently,
arguments that the TLA violates the Constitution by mandating a requirement that legislation
be passed by any ration other than a majority of a quorum vote are without merit. 55]
From the early days of the Republic to the present, supermajority voting requirements have
been deemed constitutional. Supermajority requirements are found in the following sections of
the Constitution:
Article I, section 3, clause 6
onviction in impeachment
ials
Article I, section 5, clause 2 xpu Sion o a Member oICongresss
Article 1, section ,cause Override a presidential veto
Article II, section 1, clause 3
uorum o two-thirds ot te
states to elect the President
2/26/98 34 11:18:22 AM
The Case for Constitutional Tax Limitation Page 10 of 13
rtic e , section ,cause Consent to a treaty
Article V roposmg constitutional
amendments
Article VII
tate rataication ot the
original Constitution[56]
Quorum of two -t it sot e
Amendment XII states to elect the President
d the Vice President
To remove disability o
Amendment XIV those who have engaged in
insurrection
en ment XXV section 4 lFresidentialisa i ity
The Framers' decision not to impose additional constitutional supermajority requirements does
not mean that they opposed extending the concept. It simply means that at the time of
ratification they did not see a need for other supermajority requirements. However, they did
recognize that circumstances change and that the Constitution would need to be flexible to
change with the passage of time. Consequently, they provided a mechanism to amend the
Constitution—an amendment mechanism that itself requires two supermajority voting
requirements: two-thirds Congressional adoption of the proposed amendment and then
approval by three-fourths of the states for ratification. 57]
Finally, a supermajority requirement for increasing the U.S. tax burden is not unprecedented.
The Sixteenth Amendment to the Constitution, which provides for the income tax, had to be
approved by a vote of two-thirds of Congress and three-fourths of the states. It is only logical
that we should extend this protection to increases of the tax burden that are far in excess of the
small burden first imposed in 1913. [58]
B. The Founding Fathers Embraced the Idea of Two -Thirds Supermajority Votes on
Important Policies
The method for deciding fundamental issues facing the U.S. government was one of the most
important topics addressed by the Founding Fathers while drafting the U.S. Constitution. In
the Federalist Papers, Alexander Hamilton, James Madison and John Jay argued that rule by a
simple majority vote was tantamount to mob rule. They argued that the Constitution was to
prevent transitory passions from determining the outcome of crucial decisions for the country.
James Madison, a vocal supporter of majority rule, argued that the greatest threat to liberty in
a republic came from unrestrained majority rule. ] Alexander Hamilton argued for the
checking of simple majorities through the use of the President's veto power. [60] Hamilton
recognized that two-thirds majorities to override a veto might prevent the enactment of good
laws, but responded that any injury inflicted by defeating a few good laws would be
compensated by the advantage of preventing a number of bad laws. [61 ] Hamilton also
believed that to prevent tax abuse, direct taxes required explicit constitutional constraints. [62]
In the view of the Founding Fathers fundamental decisions should be made by special
majorities of at least two-thirds of the legislature. They specifically pointed to such
fundamental areas as treaty ratification, and constitutional amendment ratification. They felt
that even in these deliberative bodies a narrow majority of Congress might easily be put
together for adopting an ill -thought out decision which would have lasting and harmful
consequences. In their view, a supermajority would reduce this danger. The Framers of the
2/26/98 3 *7 11:18:23 AM
The Case for Constitutional Tax Limitation Page 11 of 13
Constitution believed that the existence of a two-thirds supermajority for a proposal showed
strong evidence of the long-term merits of the issue in contention.
The Founding Fathers also recognized the special and important area of tax law and subjected
it to extraordinary procedures. [63] Procedures that in the tenor of the times were deemed
sufficient to protect the taxpayers of the U.S. from unjust taxation. This was especially true in
light of the fact that a deadly revolution had just recently been fought to protect the nation
from unjust taxation. Today the tenor of the times has changed. It is simply not sufficient
protection from excessive taxation that all tax bills must first come from the House. In running
up a $5 trillion debt and subjecting citizens to crushing tax burdens the Congress has clearly
shown it is not capable of protecting the interests of the American people without
constitutional help.
The present debt level of the U.S. and its high tax rates would not be accepted by our
Founding Fathers. When they wrote the Constitution they did not foresee that the law of the
land would one day permit Congress to spend as much money as it wished, irrespective of
revenues. They would look with abject horror at the debt level of this country and cry for a
change. In light of the events surrounding the Revolution and the adoption of the
Constitution—repressive and heavy tax burdens imposed from far-off London—there is no
doubt that the Framers would support a measure to protect U.S. taxpayers from repressive and
heavy tax burdens imposed from far -removed Washington, D.C. The simplest and fairest way
to do so is to adopt the TLA and its requirement that all increases in the tax burden be subject
to a supermajority vote by both houses of Congress on a straight yea or nay vote. +
C. Congress Historically Utilizes Supermajority Voting Requirements.
1. The First 100 Years
Mandating supermajority approval of legislation is a tradition dating back more than 150
years, to the Seventeenth Congress. As the number of Members in the House increased and
political parties appeared, passage of even the simplest legislation became more difficult. It
thus became necessary for the House to have some means by which to bypass the regular
order of business. In 1822 a rule was passed that no House rule could be suspended without a
two-thirds vote of the members present. In 1828 the suspension rule was amended to require a
vote of two-thirds of the Members actually voting.
2. The Twentieth Century
a. The House of Representatives
In the modern era, supermajority voting requirements continue to be used in both the House
and Senate. As with the suspension rule from the 1820s, other House rules have incorporated
supermajority voting requirements, many of which remain in effect today. For example, the
Rules Committee is responsible for controlling the flow of legislation, proposing the terms of
debate and setting the time on general debate and the procedure for amendments. Typically
floor consideration of a Rules Committee report may not occur until the day after the report is
issued. However, House rules enable two thirds of the Members to approve considering a
report from the Rules Committee on the same day it is presented to the House. If the House
rejects the Committee's rule, absent a supermajority vote to consider a second rule on the same
day the second rule was reported, consideration of a bill will be delayed.
2/26/98 3 S 11:18:24 AM
The Case for Constitutional Tax Limitation Page 12 of 13
Under the Calendar Wednesday Rule, each Wednesday of the week is set aside to allow bills
to be considered on the House floor that have been reported out of committee but blocked by
the Rules Committee. Although House rules prohibit the Rules Committee from setting aside
Calendar Wednesday, other rules allow the Calendar Wednesday procedure to be dispensed
with at any time by a two-thirds vote. Further rules require a two-thirds vote to continue
considering a measure that is carried over from a previous Calendar Wednesday without
reaching a vote on final passage. Finally, on the first day of the 104th Congress, the House
passed House Rule XXI that requires supermajority approval of all bills which increase taxes.
64]
b. The Senate
Senate rules require a two-thirds vote for suspension of the rules and for the fixing of time for
considering a subject. The Senate requires a three-fifths vote of all Senators to end debate or to
increase the time available under cloture. Further, Senate rules require a two-thirds vote to
indefinitely postpone a treaty. Finally, budget procedures require that three-fifths of the full
Senate must agree to waive balanced budget provisions or points of order in order to consider
amendments which would violate the budget approved by Congress.
VII. Requiring A Supermajority to Pass Important Legislation Is An Idea Embraced
Around the World
Leading democratic nations and statesmen have rejected simple majority votes as a means of
adopting laws that fundamentally affect their nations. [L5] These supermajority requirements
take the form of either legislative or popular referendums.
Benjamin Disraeli in the United Kingdom believed that the use of a simple majority for
altering the character of the nation was an immoral exercise of power. He theorized that
simple majorities that lead to slender margins of passage suggest only a temporary majority in
favor of a policy. Making decisions on such temporary majorities leads to decisions which are
likely to be reversed. This leads to instability and is damaging to democratic politics. Echoing
the views of Hamilton, Madison and Jay, is Disraeli's view that the clearer the majority, the
more likely that the proposed policy is correct.
Charles De Gaulle in France also favored supermajority referendum approval for important
state issues. He believed that a simple majority did not build public support. He felt that to be
successful you needed to convince the undecided and those who were mildly opposed to a
proposal that they should support and accept the decision as being fairly made. De Gaulle
believed that narrow majorities had the opposite effect. Simple majorities created embittered
opposition. The opposition is reinforced in the idea that the decision was unfair and that with
resistance their opponents' victory will only be momentary. Those whose position is lost will
resist the government in its attempts to implement the decision and divide the country on the
issue. Therefore, a simple majority was viewed as making unity impossible. In the end this
division would go a long way toward bringing about the failure of the policy. A clear
supermajority, on the other hand, would reduce these risks and help bring about the successful
implementation of the passed proposal.
Conclusion
2/26/98
39 11:18:24 AM
The Case for Constitutional Tax Limitation Page 13 of 13
Politicians who have accumulated a debt of $5 trillion over slightly more than thirty years
cannot now simply be trusted to abandon their profligate spending habits in the face of a
possible balanced budget law. Without some way to prevent politicians from simply raising
taxes to meet the requirements of any balanced budget law, the American people will suffer
from ever-increasing tax burdens. The best way to prevent our representatives in Washington
from raising our taxes is to adopt the Tax Limitation Amendment and its requirement of an
affirmative supermajority vote of both chambers of Congress for any rise in the tax burden.
The Tax Limitation Amendment is good policy. In those states that require legislative
supermajorities to increase the tax burden the method has proved to be an effective tool for
lowering both tax burdens and government spending. The Tax Limitation Amendment is
constitutional. There are numerous supermajority voting requirements mandated by the
Constitution. The U.S. was founded in part on the basis of freedom from oppressive taxes. In
light of the present federal policy of taxing to finance runaway spending, the Founding Fathers
would support extending supermajority voting to any increases in the citizens' tax burden.
Finally, requiring supermajority approval of important government policies is a concept that
has been accepted by statesmen around the world. +
2/26/98
End Notes I Appendix I Main Page I Join ATR
40
11:18:25 AM
SUPERMAJORITY TAX LIMITATIONS AT THE STATE LE... Page 1 of 1
SUPERMAJORITY TAX LIMITATIONS o
AT THE STATE LEVEL
States around the country have been forced to reform their budgeting and tax policies due to their
deficit spending. Many states have been successful in trimming their deficits without raising taxes.
The method used by the most successful states has been supermajority tax limitation laws and
spending limitation laws. One third of all Americans live in a state withe supermajority
constitutional tax limitations. In most of the states supermajority requirements, the idea of
requiring a greater than fifty percent vote of the legislature to increase taxes grew out of the tax
revolt movement and the initiative process. These states offer a successful model for the Federal
Government's budget and tax reform efforts. The following states have supermajority tax limitation
requirements:
State Requirement Year Enacted AppliesTo
Arizona elecied 1992 All taxes
Arkansas— elected taxes since 1934 except sales tax.
California— elected Property taxes
Colorado elected taxes
Delaware elected7 1980 Revenue increases
o rid a e ecte anges intthe corporate income tax rate
Louisiana— elected taxes
Mississippi elected - taxes
Oklahoma elected taxes
South a of elected or increasing tax base and existing tax rate
ATR Home I Join ATR ]
2/26/98 %/ / 11:16:06 AM
NEWS: Supermajority vote not taxing to lawmakers
Supermajority
to lawmakers
vote not taxing
A new two-thirds vote requirement to approve tax
increases was not a factor in the 1997 legislative session.
BV Sean Whaley
Donrey Capital Bureau
CARSON CITY -- Fears of increased vote
trading resulting from a mandate that requires
tax increases be approved by two-thirds of the
63 -member Legislature were not realized in the
1997 session, lawmakers and others agree.
There was plenty of vote trading as the
session wound to a close July 7, but the
supermajority required for tax increases was not
a factor, they said. A divided Legislature, with
Democrats running the Assembly and the
Republicans running the Senate, was the main
reason.
The two-thirds majority required for tax and
fee increases became a requirement with voter
approval in 1996 of an initiative placed on the
ballot by former Assemblyman Jim Gibbons.
Gibbons, now a Republican member of
Congress, gathered signatures to place the
measure on the ballot after failing to get
legislative approval of his idea in 1993. Until
this session, only a simple majority was required
to raise taxes.
The change gave Democratic and Republican
minorities more voting power. Before, only 22
votes in the 42 -member Assembly and 11 in the
21 -member Senate were needed to raise taxes.
With the change, 28 members of the Assembly
and 14 members of the Senate have to approve
tax increases.
In the reverse, it meant only eight Senators or
15 members of the Assembly could hold up a tax
increase and trade their votes for pet projects.
I don't think it made much difference at all,"
said Senate Minority Leader Dina Titus, D -Las
Vegas. "We didn't consider raising any major
taxes."
Carole Vilardo, president of the Nevada
Taxpayers Association, agrees the two-thirds
vote requirement did not play a major role in its
first trial.
The issues where it might have come into
Page 1 of 3
2/26/98 410Z 11:31:24 AM
NEWS: Supermajority vote not taxing to lawmakers
play were so big, such as infrastructure and
school construction, that it was the normal
negotiating process, not the two-thirds vote," she
said. "I'm not personally aware of the two-thirds
vote being used as a negotiating tool."
Assemblyman David Goldwater, D -Las
Vegas, chairman of the Infrastructure
Committee, said the two-thirds requirement was
in the back of everyone's mind during bill
hearings and negotiations but did not play a big
role.
It was never brought up publicly, not to my
recollection," he said. "But it was understood."
Only 35 bills out of the 1,167 introduced
during the 1997 Legislature required a two-thirds
vote, lessening the potential impact of the
constitutional amendment. Many of those that
did pass were noncontroversial and received near
unanimous support, such as measures approving
new fees for special license plates.
There were a few exceptions.
One issue in which it could have become a
factor was Assembly Bill 353, authorizing
several different tax increases to pay for school
construction. What started as a bill to help Clark
County's school overcrowding problems was
expanded through negotiation to help other
districts.
Rural lawmakers objected to a provision in
the bill requiring a separate oversight committee
to keep track of construction spending. The bill
was changed to delete the requirement in rural
communities.
But Senate Taxation Chairman Mike
McGinness, R -Fallon, said the compromise was
the result of normal discussions among
lawmakers to craft a bill that would receive the
maximum support. The two-thirds vote issue was
never raised in discussions, he said.
The bill passed in both houses without a
single no vote.
Another was a proposal to use room taxes
raised at the stateline casinos at Lake Tahoe in
Douglas County for tourism promotion. The bill,
which took away money from other programs in
the county, required a two-thirds vote and was
opposed by Sen. Lawrence Jacobsen, R -Minden,
the area's representative.
The bill received only 12 votes when it came
to the Senate floor, but the measure was
reconsidered and passed the second time by a
vote of 16-5.
Sen. Mark James, R -Las Vegas, one of those
who voted no the first time and then changed his
Page 2 of 3
2/26/98 '/3 11:31:31 AM
NEWS: Supermajority vote not taxing to lawmakers
2/26/98
mind, said his first vote was a mistake.
James said he did not realize it was a bill the
Tahoe area residents wanted.
I didn't get anything for changing my vote,"
he said. "I didn't see the two-thirds vote used to
extract any concessions."
The bill authorizing county commissions to
raise the sales tax a quarter cent to pay for
infrastructure passed by only 14 votes in the
Senate, but a legislative lawyer had ruled the
two-thirds rule did not apply because the
measure was enabling and required approval
either from the county commission or voters.
Even so, Titus said there was pressure to get
14 votes for the measure because of concerns it
would be challenged in court otherwise.
Vilardo said several questions about when
the supermajority was required came up during
the session. A bill to clarify the intent passed the
Senate but did not make it out of the Assembly,
she said.
Titus said another reason the two-thirds issue
did not come into play was because no firm
coalitions emerged during the session.
There were floating coalitions pitting the
Assembly against the Senate, Democrats versus
Republicans and urban versus rural," she said.
It also may have been a non -issue because of
its newness, Titus said.
It has the potential to be a big factor," she
said.
Few taxes approved in recent legislative
sessions would have been affected by the
two-thirds requirement. One major exception
was the business tax passed by the Legislature in
1991 that now brings in about $70 million a
year. The tax passed by 27 votes in the Assembly
and 13 votes in the Senate, which would have
been one vote shy in each house under the new
rule.
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1997 Las Vegas Review -Journal - Sunday, August 17 1997 03:00
Page 3 of 3
11:31:31 AM
Reducing school bond supermajority rule debated
Reducing school bond supermajority rule debated
By Associated Press
Page 1 of 2
BOISE_ Some of Idaho's leaders are warming to the idea of reducing the vote needed to pass a
school bond, although tax advocates say the current process works.
State Rep. Donna Boe, D -Pocatello, wants to lower the two-thirds majority vote, 66.67 percent,
required to adopt a bond to 60 percent.
Gov. Phil Batt is concerned about the need for more classrooms.
He is reluctant to do anything with the supermajority. But at the same time, he doesn't like
schools deteriorating," said Lindsay Nothern, Batt's press secretary.
House Speaker Mike Simpson, who a few years ago would not even consider the change, said it
has merit.
It's harder to build a school building in Idaho than anywhere else in the country," the
Blackfoot Republican said, adding any plans must include state assistance for building public
schools to ease the burden on property tax payers.
Idaho is not whittling away at its $700 million backlog in school improvements very quickly,
and winning a supermajority in a bond election is not getting any easier.
Fourteen bonds totaling 5128.1 million failed in Idaho in the past two years after they received
more than a 60 percent majority, but not two-thirds.
The supermajority is required by the state constitution. Changing it would require approval of
two-thirds of the Legislature and a statewide vote.
Reducing the supermajority is not the only idea being considered to make it easier for school
districts to build or improve their facilities.
Idaho schools Superintendent Anne Fox opposes dropping the two-thirds requirement, but
supports a half -cent sales tax hike.
We're dealing with the issue of eouity in the tax base_" Rhonda Edmiston. Fox's
WashingtonPost.com: End Supermajority Rules,... Page 1 of 2
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Return to Maryland End Supermajority Rules, Montgomery
Election Results. Groups Urge
Return to the Regional
Results Guide. By Manuel Perez -Rivas
Washington Post Staff Writer
Return to the Maryland Tuesday, October 29, 1996; Page B05
Elections Guide.
A diverse coalition of government officials, political groups,
public employee unions and civic activists gathered in Rockville
yesterday to urge voters to support Question D on next
Tuesday's ballot in Montgomery County.
Question D would eliminate a provision that requires the
nine -member County Council to have at least seven votes to
exceed spending limits it sets several months before the county
budget is finalized each spring. Instead, a simple majority of five
votes would be needed to approve a budget exceeding those
limits.
In addition, the number of council members needed to adopt an
operating budget that grows at a rate higher than the area's
inflation rate would be reduced from six to five.
Supporters argued that passage would allow a more democratic
process for establishing budget priorities. They said the present
supermajority system, which dates to 1990, can be "held
hostage" by a few council members with different priorities from
the majority.
What supermajority means is tyranny of the minority," said
council member Derick Berlage (D -Silver Spring). "Any three
members of the nine -member council have the ability to bring
the budget process to a standstill."
Board of Education President Ana Sol Gutierrez (3rd District)
said schools in particular have felt the impact of the
WashingtonPost.com: End Supermajority Rules,... Page 2 of 2
spending and that backers chiefly are interested in higher
spending.
The citizens put these restrictions onto the charter, and there's a
reason for it. I believe it has been a brake -- that's B -R -A -K -E --
on this council," said council member Nancy Dacek (R -Up
County). "What we have here are groups sponsoring it who are
anxious for more spending."
Robert R. Denny, who helped lead the 1990 tax revolt that saw
passage of the county's supermajority requirements, also
dismissed the argument that a simple majority rule is more
democratic, noting that supermajority restrictions exist at all
levels of government. "By removing the supermajority rules,
you're setting [officials] up to be irresponsible," he said.
Copyright 1996 The Washington Post Company
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2/26/98 4Y I 11:35:16 AM
Why A Supermajority Would Protect Taxpayers -... Page 1 of 3
WHY A SUPERMAJORITY WOULD PROTECT TAXPAYERS
Daniel J. Mitchell
McKenna Senior Fellow in Political Economy
The Heritage Foundation
FYI No. 93
March 29, 1996
Table 1: How Supermajority States Compare in Gross State Product and Per Capita Tax Revenue
On April 15th, the House of Representatives will vote on a Constitutional Amendment
requiring a two-thirds supermajority for Congress to raise taxes. In favor of the amendment are those
who believe that lawmakers will be more fiscally responsible and the economy will grow faster if it
becomes more difficult for Congress to raise taxes. On the other side are those who believe
restricting tax increases would interfere with the majority's ability to determine economic policy.
To be fair, opponents are correct. The proposed amendment would restrict the rights of the
majority. But that is precisely the point. Just as the First Amendment is supposed to prohibit the
majority from passing laws to infringe upon the rights of free speech and the Second Amendment is
supposed to prohibit the majority from passing laws to infringe on the right to keep and bear arms,
the supermajority amendment is designed to place limits on the power of the majority to take money
from the minority. More specifically, taxpayers are presumed to have a right to their earnings and
that only tax increases with very broad support -- as measured by the ability to attract a two-thirds
supermajority -- are permissible.
There is little doubt that a supermajority will make it harder for politicians to take more money
from taxpayers. That is why lawmakers who believe taxes should be higher oppose it. Had a
supermajority been in place, some major tax increases from recent years would not have become
law. Consider:
The record tax increase pushed through Congress in 1993 by President Clinton was approved
by 51-50 in the Senate and 218-216 in the House. Since a single vote -switch in either body
would have killed the legislation, a supermajority requirement easily would have saved the
economy from the largest tax increase in American history.
The large tax increase signed into law in 1990 by President Bush was approved by 54-45 in
the Senate and 228-200 in the House. Had a supermajority been required, this ill-fated
measure would have fallen 12 votes short in the Senate and 58 votes shy in the House.
Other major tax increases in recent years, including the tax hikes of 1982, 1984, and 1987,
also would have been blocked by a supermajority provision.
Needless to say, these tax increases might never even have come up for a vote had
supermajority approval been required. Or at the very least, supporters of the tax increases would
have had to reduce the size of the hikes and probably make much-needed reforms to spending
programs to attract the needed votes. This helps explain why the lawmakers who oppose this in
Congress are those who traditionally favor raising taxes -- they fear the supermajority would restrict
them.
A supermajority requirement would not, of course, block all tax increases. The 1983 Social
Security bailout legislation, for instance, imposed a huge tax increase on workers and allowed
incumbents at the time to avoid taking needed steps to fix a fundamentally broken system. That
legislation did receive more than two-thirds support in both chambers of Congress. Likewise, it is
clear that Congress would be able to increase spending, whether financed by taxes or debt, if there
2/26/98 % 9 11:35:57 AM
Why A Supermajority Would Protect Taxpayers -... Page 2 of 3
was a genuine national emergency. A supermajority requirement during World War I1, for instance,
would not have impeded the conduct of fiscal policy.
Nonetheless, some critics say that such a requirement would be disruptive, or even disastrous, if
it were imposed on Congress. But seven states worked under such a limit for at least 15 years and
there is no indication that it has caused any problem. Significantly, not a single state has repealed the
provision. Moreover, the seven states which have lived for quite some time under some form of
supermajority -- Arkansas, California, Delaware, Florida, Louisiana, Mississippi, and South Dakota
have been joined recently by Arizona, Oklahoma, and Colorado. Nevada and Ohio may soon join
the list.
Ultimately, the debate over the supermajority boils down to a fight about the size of government
and the effect of taxes on economic performance. Proponents of smaller government want to use the
balanced budget amendment and the supermajority together to slowly shrink the size and power of
the federal government. Further, they want to put a brake on higher taxes, which undermine the goals
of fiscal responsibility and economic performance. For instance:
Higher taxes typically are followed by bigger deficits. Tax increases in 1982, 1983, 1984,
1987, 1990, and 1993 have not balanced the budget. Indeed, current CBO projections show
the deficit climbing to more than $300 billion within ten years if current policies are left in
place.
Higher taxes are associated with higher spending. A 1991 study by the Joint Economic
Committee showed that every dollar of higher taxes is associated with more than $1.59 of new
spending.I Tax increases are virtually guaranteed to trigger new spending if there is a
balanced budget requirement since any new revenues simply allow politicians to satisfy the
balanced budget requirement at a higher level of spending.
Higher taxes hurt the economy. Lower taxes in the 1920s, 1960s, and 1980s helped trigger
economic booms. Higher taxes in the 1930s, 1970s, and 1990s, by contrast, are associated
with very mediocre economic performances. The evidence linking taxes and economic
performance is powerful. Numerous studies show that nations with low taxes grow faster than
countries with high taxes and also that countries can improve their performance by reducing
taxes on productive economic behavior.2 Similar studies show taxes have the same effect in
and among states.3
Higher taxes do not collect the promised revenues. Fewer jobs means fewer taxpayers.
Lower profits means lower tax collections. Falling incomes mean falling tax revenues.
Understanding these simple relationships helps explain why individual income tax revenues
have fallen as a percent of GDP since Ronald Reagan left office even though Americans have
suffered through two major tax increases.
A supermajority rule is a necessary component of any strategy to shrink the size and power of
the federal government, and to limit the power of Congress to tax. High taxes hurt the economy. Not
only are five supermajority states below the national average in growth of taxes, but also five are
above the national average in overall economic growth (see Table 1). This may be why more and
more states have adopted the rule. There is every reason to believe it would have a positive effect on
fiscal policy in Washington. Requiring supermajority votes to raise taxes ensures that politicians
cannot continue to spend other people's money and evade fiscal responsibility by imposing a higher
tax bill on the nation.
A wide range of economic studies demonstrates that states will be better off if they keep their
tax burdens low. Curbing taxes limits the growth of government and boosts economic performance.
By making it harder to raise taxes, supermajority rule would have a desirable effect on the nation's
2/26/98 449 11:35:58 AM
Why A Supermajority Would Protect Taxpayers -... Page 3 of 3
fiscal policy and overall economic performance. To be sure, a supermajority does not guarantee
sound economic policy. The record tax increase approved in California several years ago, for
instance, happened in spite of a two-thirds supermajority requirement. And many states without
supermajorities, such as Tennessee and Nevada, have scored well in most categories of economic
performance (this may be due to these states not having an income tax). When all factors are
examined, however, there is no escaping the logical relationship between supermajorities and
superior state performance. America would be well served if this lesson were applied to the federal
budget.
Endnotes:
1. Richard Vedder, Lowell Gallaway, and Christopher Frenze, "Taxes and Deficits: New
Evidence," Joint Economic Committee Staff Report, October 31, 1991.
2. For an extensive list of studies, see Daniel J. Mitchell, "Jobs, Growth, Freedom, and Fairness:
Why America Needs a Flat Tax," Heritage Foundation Backgrounder No. 1035, May 25, 1995.
3. For a comprehensive analysis of state evidence, see Richard K. Vedder, "State and Local
Taxation and Economic Growth: Lessons for Federal Tax Reform," Joint Economic
Committee Staff Report, December 1995.
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Heritage 25: Leadership for Arnerica
2/26/98
SD
11:35:58 AM
States With Supermajorities - 4/10/97 Page 1 of 5
10, 1997
DO STATES WITH SUPERMAJORITIES HAVE SMALLER TAX INCREASES
OR FASTER ECONOMIC GROWTH THAN OTHER STATES?
by Iris J. Lav and Nicholas Johnson
The Heritage Foundation contends that states in which a supermajority vote of the
legislature is required to raise taxes have experienced faster economic growth and fewer
tax increases than other states. A March 1996 Heritage report looks at the seven states
that have had supermajority requirements in place for a number of years — Arkansas,
California, Delaware, Florida, Louisiana, Mississippi, and South Dakota — and finds that
five of the seven states experienced slower than average growth in tax revenue. It also
finds that five of the seven states (but not the same five states) experienced faster
economic growth than the average state. The Heritage report suggests a causal link
between supermajority limits, lower taxes, and faster economic growth, saying "...there is
no escaping the logical relationship between supermajorities and superior state
performance."1
This simplistic analysis is flawed in a number of ways. It relies on only one among a
number of possible measures of economic growth. It considers only state -level tax
changes rather than changes in total state and local revenues, despite the capacity of
states to shift costs and responsibilities to local governments. And it compares 1980, a
year in which the economy was turning down into a mild recession, with 1992, a year at the
beginning of an economic recovery. If one chooses more appropriate data series to
measure revenues and economic growth and adjusts the time periods to represent similar
points in the business cycle, conclusions opposite to those Heritage has presented may be
drawn. The fact that different analytical choices lead to different results should serve as a
caution that no supportable conclusions can be drawn from the type of simplistic analysis
Heritage has conducted.
By some measures, supermajority states have had lower economic growth and more tax
increases than other states. For example:
Five of the seven states with supermajority requirements experienced
lower -than -average economic growth measured by change in per capita personal
income between 1979 and 1989, two years at similar points in the business cycle.
Four of the seven supermajority states had lower -than -average economic growth
measured by change in Gross State Product from 1979 to 1989.
Six of the seven states with supermajority requirements had higher -than -average
growth of state and local revenues as a percent of residents' incomes from 1979 to
1989.
2/26/98 11:39:15 AM
States With Supermajorities - 4/10/97 Page 2 of 5
Five of the seven states had higher -than -average increases in state and local taxes
per capita from 1984 to 1993, two other years falling at similar points in the business
cycle.
The factors affecting state economic growth are far more complex than proponents of
supermajority requirements typically acknowledge. Such factors include the interplay of
state resource endowments, labor force skills, location, and level of public investment and
state services, among others. A far more sophisticated analysis would be required to
discern any effect supermajority requirements might or might not have on state tax burdens
or state economies.
Heritage's Choices of Data May Skew Results
In preparing its report, the Heritage Foundation made choices that may have skewed the
results of its analysis. The questionable choices include the time periods analyzed, the
measure of state economic growth, and the measure of tax burden.
The Heritage report compares state economic growth and changes in taxes from 1980 to
1992, which are years that represent two different points in the "business cycle." In 1980,
the economy turned down from the peak of an economic expansion into a mild recession;
in 1992 the economy was beginning its upswing from the deep 1990-91 recession. State
tax policy and state economic growth each are very sensitive to the business cycle, and
different state economies react differently to economic downturns and upswings. An
accurate picture of state changes requires comparing two years at similar points in the
business cycle.
Heritage chose Gross State Product (GSP) as its measure of state economic growth; GSP
measures the total output of all industries within a state. A different measure, personal
income, is more often used to gauge state economic activity. Personal income measures
the total income of state residents, including income from out-of-state sources. Personal
income per capita measures the economic well-being of an average resident, which may
best reflect the goal of state economic policy.
Similarly, Heritage chose to consider only taxes levied at the state level. Yet when state
taxes are constrained, state legislatures may meet their responsibilities for providing
services by shifting new responsibilities to local governments or by cutting local aid. Either
course of action can lead local governments to raise their taxes. Because of these potential
shifts, a measure that includes both state and local taxes should be considered.
An additional shortcoming of the state tax series Heritage uses is that it excludes many
tax -like "fees." A more comprehensive measure, state and local revenues, includes
revenue sources such as fees and lottery proceeds that may be substituted for revenues
from taxes.
Lastly, the Heritage study measures tax burden by calculating the amount of tax revenue
per resident. Many analysts find it more appropriate to measure taxes as a percentage of
residents' incomes. Because differing wage levels in different states affect both residents'
incomes and the cost of providing government services, measuring taxes as a percentage
of income provides a more meaningful comparison of tax levels and changes in tax burden
over time.
Ir2
2/26/98 11:39:18 AM
States With Supermajorities - 4/10/97
Alternative Time Periods and Measurements Yield Results Different from the
Heritage Results
Page 3 of 5
Results quite different from those presented in the Heritage report may be obtained by an
analysis that matches up similar points in the business cycle and considers a variety of
measurements of economic activity and revenues. Depending on the choice of time frame
and methodology, such comparisons may actually show that supermajority requirements
are associated with increased taxes and slower economic growth.
Table 1 compares the economic growth of the seven supermajority states relative to
average growth in all states. Three different measures of growth and two different recent
time periods beginning and ending at similar points in the business cycle are considered.
Taken together, these measures show no clear connection between supermajority
requirements and economic growth. (See appendix tables for detailed comparisons.)
By most measures, the supermajority states split almost down the middle (4-3 or 3-4)
about half experienced stronger economic growth than the national average, while
the other half had weaker growth.
By one method of measuring economic growth — change in per -capita personal
income from 1979 to 1989 — only two of the supermajority states outperformed the
national economy; the other five had lower economic growth than the average state.
Table 1
Portion of Supermajority States with
Stronger -than -average Economic Growth
Similar results may be found with respect to levels of revenue increases. Table 2 shows
revenue increases in the supermajority states using broader measures of state and local
taxes and revenues over the two time periods. The picture that emerges is decidedly
mixed.
In only one of the supermajority states did state and local revenue as a percentage
of personal income rise less rapidly than in the average state from 1979 to 1989. In
the other six supermajority states, the growth of state and local revenue as a percent
of personal income was higher than in the average state.
Fewer than half the supermajority states showed lower -than -average growth in state
and local taxes between 1984 and 1993, measured either as taxes per capita or
taxes as a percentage of residents' incomes.
Table 2
Portion of Supermajority States with Tax Increases
Lower than the National Average
2/26/98 5`'? 11:39:18 AM
1979 to 1989 1984 to 1993
Gross State Product 3 of 7 not available
Personal Income 3 of 7 4 of 7
7e—rsonal Income Per Capita 2 of 7 4 of 7
Source: CenteT on u qet an o icy Priorities. Based on datarom Bureau
Analysis, with population adjustments from the Bureau of the Census.
of Economic
Similar results may be found with respect to levels of revenue increases. Table 2 shows
revenue increases in the supermajority states using broader measures of state and local
taxes and revenues over the two time periods. The picture that emerges is decidedly
mixed.
In only one of the supermajority states did state and local revenue as a percentage
of personal income rise less rapidly than in the average state from 1979 to 1989. In
the other six supermajority states, the growth of state and local revenue as a percent
of personal income was higher than in the average state.
Fewer than half the supermajority states showed lower -than -average growth in state
and local taxes between 1984 and 1993, measured either as taxes per capita or
taxes as a percentage of residents' incomes.
Table 2
Portion of Supermajority States with Tax Increases
Lower than the National Average
2/26/98 5`'? 11:39:18 AM
States With Supermajorities - 4/10/97 Page 4 of 5
Trends Do Not Prove Causation
Even if tables 1 and 2 presented clearer trends among the seven supermajority states, it
would be not be correct to conclude that supermajority requirements were a factor in the
economic growth or in the tax decisions in those states. Other factors, such as regional
economic variations or changes in political power, are much more likely to affect state
economic performance and government finances. A far more sophisticated analysis than
either the Heritage study or the analysis presented above would be required to conclude
that supermajority requirements have had any substantial effect either on state tax burdens
or on state economies.
End Notes
1. Daniel J. Mitchell, "Why a Supermajority Would Protect Taxpayers," The Heritage Foundation, March 29,
1996.
Appendix
Table A-1
Economic growth in states that required supermajorities to raise taxes.
Change
1979 to 1989 1984 to 1993
Change in Personal
Income Per Capita
tate an
local taxes
tate and localtate
own -source revenue
and State and local
local taxes own -source revenue
Taxes per capita 5 of 77
to 1993
2 of 7 b 0
Taxes as a percent of
income
4 of 7 1 of 7 3 of 7 4 of 7
ource: enter on u qet an Policy Priorities. ase on ata rom ureau o t e ensus, with
income adjustments from the Bureau of Economic Analysis.
Trends Do Not Prove Causation
Even if tables 1 and 2 presented clearer trends among the seven supermajority states, it
would be not be correct to conclude that supermajority requirements were a factor in the
economic growth or in the tax decisions in those states. Other factors, such as regional
economic variations or changes in political power, are much more likely to affect state
economic performance and government finances. A far more sophisticated analysis than
either the Heritage study or the analysis presented above would be required to conclude
that supermajority requirements have had any substantial effect either on state tax burdens
or on state economies.
End Notes
1. Daniel J. Mitchell, "Why a Supermajority Would Protect Taxpayers," The Heritage Foundation, March 29,
1996.
Appendix
Table A-1
Economic growth in states that required supermajorities to raise taxes.
Change in Gross
State Product
Change in Personal
Income
Change in Personal
Income Per Capita
1979 to 19 1979 to 1984
1989
to 1993 1979 to 1984
1989
to 1993
Arkansas o 0 0
California o 0 0
e aware o 0 0
on a o 0 0
ouisiana o o 0 0
Mississippi o 0 0 0
South a ota o 0 0 0
Average o 0 0 0
Number o
supermajority states
with economic growth
above average 1 3 1 3 1 4 1 2 1 4
ee notes at end ot appendix.
Table A-2
Changes in state and local government taxes and revenue per capita
in states that required supermajorities to raise taxes.
1979 to 1989 1984 to
2/26/98 11:39:18 AM
States With Supermajorities - 4/10/97 Page 5 of 5
Table A-3
Changes in state and local taxes as percent of personal income
in states that required supermajorities to raise taxes.
State and Local
Taxes
State and Local
Own -Source
Revenue
State and
Local Taxes
State and Local
Own -Source
Revenue
Arkansas o
tate and Localtate
Own -Source
Revenue
and
Local Taxes
State and Local
Own -Source
Revenue
C -57i Forniia o o
0 77.
Delaware o
0 0 0
Florida o
0 0
0
Louisiana o
0 o o
Mississippi o 0 0
South a ota o 0 0
0
Average o 0 0
o
Number o
supermajority
states with tax or
revenue growth
below average
o 0 6 0
ee notes at end ot appendix.
3
Table A-3
Changes in state and local taxes as percent of personal income
in states that required supermajorities to raise taxes.
Notes: Gross State Product not available for years after 1992.
In cases where the state average equalled the national average, the change was computed to additional
decimal places to find the correct comparison.
U.S. average excludes Alaska and the District of Columbia, whose revenue systems are significantly different
from those of other states.
All data are for fiscal years except Gross State Product.
Sources: U.S. Bureau of Economic Analysis, U.S. Census Bureau.
Center on Budget and Policy Priorities.
aiit'F 6m&:a K JL##L"LfY}'i J..S,.i.-„ ~,.fiN.N k F +11i.:r i.s•ts1I1Y.L':d u'a'k ++ '.
Background Information I Board of Directors
Publication Library I Center Staff I Search this site
Job Opportunities I Internship Information I Top Level
c z b i .Y ..wi'!L'. .wWiCY,ar lP.sRL1{wLiAR .`.i.#"Sr" C:,i im"y'='*..«K`T iid•",sVLi1Q.e`.6a:v*'Y::Cd t _
2/26/98 11:39:22 AM
1979 to 1989 1984 to 1993
State an
Local Taxes
tate and Localtate
Own -Source
Revenue
and
Local Taxes
State and Local
Own -Source
Revenue
Arkansas o 0 0 77.
California o 0 0 0
Delaware 1% 0 0 0
Florida o 0 o o
Louisiana o 0 0 0
Mississippi o 0 0 0
South a ota o o a o
Average o 0 6 0
Number of
supermajority states
with tax or revenue
growth below average
3
ee notes at end of appendix.
Notes: Gross State Product not available for years after 1992.
In cases where the state average equalled the national average, the change was computed to additional
decimal places to find the correct comparison.
U.S. average excludes Alaska and the District of Columbia, whose revenue systems are significantly different
from those of other states.
All data are for fiscal years except Gross State Product.
Sources: U.S. Bureau of Economic Analysis, U.S. Census Bureau.
Center on Budget and Policy Priorities.
aiit'F 6m&:a K JL##L"LfY}'i J..S,.i.-„ ~,.fiN.N k F +11i.:r i.s•ts1I1Y.L':du'a'k ++ '.
Background Information I Board of Directors
Publication Library I Center Staff I Search this site
Job Opportunities I Internship Information I Top Level
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2/26/98 11:39:22 AM
TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS... Page 1 of 28
Policy Analysis No. 213 July 25, 1994
TAMING LEVIATHAN:
ARE TAX AND SPENDING LIMITS THE ANSWER?
by Dean Stansel
Dean Stansel is a fiscal policy analyst at the Cato Insti tute.
Executive Summary
After a decade of dormancy, the tax revolt is back. Fed
up with rapidly rising state budgets, Americans are increas-
ingly taking matters into their own hands, voting into law
limits on the ability of state lawmakers to tax and spend.
In the past two years, five states approved such populist
measures. This year voters in as many as six states will
have the opportunity to vote on some type of tax limitation
initiative.
The opposition to tax and expenditure limitations (TELs)
is enormous. Opponents charge that restraining the growth of
taxes and spending is impossible without doing things like
taking cops off the beat and firefighters out of the fire-
house. Other critics make precisely the opposite complaint
about TELs, charging that TELs are ineffective and do not
limit the growth of taxes and spending as promised.
This study demonstrates that properly designed TELs can
and do limit the growth of state taxes and spending. For
example, the growth rate of per capita state spending in TEL
states fell from 0.8 percentage points above the U.S. average
in the five years preceding TEL enactment to 2.9 percentage
points below the U.S. average in the five years after TEL
enactment.
Unfortunately, many TELs are designed in a way that
minimizes their effectiveness. This study examines that
issue and provides a detailed description of how an effective
TEL should be designed.
If the citizens of a state wish to limit the growth of
Leviathan, they should not abandon TELs; instead, they should
ensure that the TELs are properly constructed.
Introduction
The grassroots tax revolt, which began in the stagfla-
2/26/98 ' 4:33:57 PM
TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS... Page 2 of 28
tionary years of the late 1970s, is brewing again. Though
the misery index is not what it was in the days of Proposi-
tion 13, there is a rising sentiment among voters that state
government has grown too large. That sentiment is grounded
in reality: since 1980 total state spending has climbed by
60 percent (after adjusting for inflation).(1)
The movement for tax and expenditure limitations (TELs)
is growing in much the same way the term -limits movement is.
In 1991 two states --Connecticut and North Carolina --enacted
TELs for the first time, and two other states --Colorado and
Louisiana --modified their TELs. Since then five states have
enacted measures to restrain the growth of taxes and spend-
ing.(2)
In March 1992 Oklahomans passed a constitutional
amendment requiring all tax increases to pass both
houses of the state legislature with a three-fourths
majority or be approved by a majority of the voters.
In November 1992 voters in Colorado passed Amendment
1, the Taxpayer Bill of Rights. That measure requires
that any increase in taxes --state or local --be approved
by the voters. It also limits spending growth to that
necessary to keep pace with population growth and
inflation.
Also in November 1992 voters in Connecticut passed a
constitutional amendment limiting spending growth to
the rate of growth of personal income or inflation,
whichever is greater.
In 1992 an overwhelming 72 percent of Arizona voters
approved a constitutional amendment requiring a two-
thirds majority in the legislature for any increase in
taxes or fees.
Finally, voters in Washington State approved a con-
stitutional amendment in November 1993 that limits
state spending growth to the rate of population growth
plus inflation and requires voter approval of any tax
increases that would exceed that limit.
All told, 23 states now have TELs. In addition, this
year on election day in November, voters in as many as six
states will have the chance to vote on some type of tax
limitation initiative.(3) (Table A.1 in the appendix summa-
rizes each of the prospective ballot initiatives.)
Although many critics have claimed that TELs are not an
effective means of restraining the growth of taxes and
spending, this study presents new evidence refuting those
contentions. It finds that TELs, when designed properly,
can be and have been an effective tool for restraining the
growth of both taxes and spending.
r7
2/26/98 4:34:02 PM
TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS...
The five-year growth rate of per capita state spend-
ing in TEL states fell from 0.8 percentage points above
the U.S. average in the five years before TEL enactment
to 2.9 percentage points below the U.S. average in the
five years after enactment.
Per capita spending in TEL states fell from 6.4
percent above the U.S. average in the year of TEL
enactment to only 1.7 percent above the U.S. average in
1992.
If the level of per capita spending in TEL states had
not declined, the state spending burden per family of
four in those states would have been, on average, $450
more in 1992 than it was.
Similar declines in the growth and level of spending in
TEL states were found when those states were compared with
non -TEL -states, and an examination of state taxes and state
and local spending shows the same pattern of change. In
sum, TELs appear to have imposed restraint on the growth of
state budgets and taxes.
Why TELs Are Needed
The expansion of government over the past several
decades has been enormous. Since 1950 the real growth of
government spending at all levels has outpaced population
growth by a margin of almost eight to one. As a result, the
per capita burden of government exploded upward by 254
percent, even after adjusting for inflation.(4)
Though real government spending at all levels surged by
480 percent from 1950 to 1990, real state government spend-
ing rose even faster, by 534 percent.(5) Over the last two
decades that burden has been growing even larger.(6) As
Figure 1 shows, from 1970 to 1980, real state spending grew
more than two and a half times faster than population. More
recently, from 1980 to 1990, real state spending grew over
Figure 1
State Spending Growth vs. Population Growth
Years Population Growth
1970-80 ills
1980-90 109.
Spending Growth
28%
42%
Page 3 of 28
2/26/98
5-9
4:34:02 PM
TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS... Page 4 of 28
Graph Omitted)
four times faster than the number of those it serves. Since
1980 many state budgets have nearly doubled in size, even
after adjusting for inflation. State taxes have climbed at
a similar pace.
Growing evidence indicates that voters do not want
government to be as large as it has become. Exit polls on
election day in November 1992 indicated that, given a choice
between lower taxes and more government services, 55 percent
of voters preferred to keep taxes down, even if that meant
fewer government services, while only 36 percent said the
opposite. One year later in a similar poll in New Jersey,
an even higher 60 percent of voters said they would prefer
lower taxes and fewer services, compared to just 33 percent
who said the opposite.(7) It is in part such hostility to
government that is driving the tax revolt. Not trusting
politicians to restrain budget growth and rising tax bur-
dens, Americans are increasingly taking matters into their
own hands, voting into law strict limits on the ability of
their state governments to tax and spend.
History of the Tax Revolt
In June 1978 voters in California, fed up with skyrock-
eting property taxes, overwhelmingly passed Proposition 13.
Hatched by anti -tax crusader Howard Jarvis, Proposition 13
rolled back local property taxes to 1 percent of assessed
valuation, limited assessment increases to the lower of 2
percent or the annual inflation rate, required two-thirds
voter approval for new local taxes, and required two-thirds
approval of the legislature to raise existing or impose new
taxes.
The passage of Proposition 13 led to a push for numer-
ous similar measures in other states. Between 1978 and
1980, 43 states adopted new limitations on local property
taxes or new property tax relief plans. Emboldened by their
success, the tax revolters took aim at state taxes as well.
Between 1978 and 1982, 15 states reduced their general
income tax rates, 10 indexed their personal income tax
systems, 7 eliminated their gift taxes, and 6 repealed their
inheritance taxes.(8)
In addition, explicit limits on spending were imposed.
In 1976 New Jersey passed the first state TEL, and by 1982
TELs had been enacted in 20 states.(9) Though TEL enactment
slowed along with the fervor of the tax revolt during the
prosperous 1980s --only two additional states enacted TELs
from 1983 to 1990 --voter frustration is now reversing that
trend.
2/26/98 .
40"
I 4:34:02 PM
TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS... Page 5 of 28
What Other Studies Have Found
Many studies have contended that TELs do not effective-
ly restrain the growth of government. For instance, Daphne
Kenyon and Karen Benker examined the change in expenditures
relative to personal income for TEL versus non -TEL states
over the period 1978-83. They found that in some years TEL
states saw slower spending growth than non -TEL states, while
in other years TEL states saw faster spending growth than
non -TEL states. Though Kenyon and Benker say that there is
some evidence that TELs may have moderated spending in some
states, they conclude that "for most states, TELs have not
been a constraint on growth in taxing or spending." (10)
Marcia Howard examined both state tax collections and
state general fund expenditures as a share of personal
income over the period 1980-87. She found that, while state
taxes grew faster than personal income in TEL states, taxes
outpaced income growth by slightly more in non -TEL states.
Further, Howard found that state general fund expenditures
as a share of personal income actually fell in TEL states,
from 5.5 percent in 1979 to 5.41 percent in 1987, lower than
spending in non -TEL states. She nevertheless concluded
that, because the differences were small, there was an
absence of strong evidence that tax and expenditure limita-
tions have been successful."(11)
Dale Bails examined the change in five components of
per capita state spending and revenue over the period 1981-
85, the."post-tax revolt years." He found that each of the
measures grew more slowly in TEL states than in non -TEL
states. For instance, per capita total general revenues
rose 30 percent in TEL states compared to 36 percent in
non -TEL states. However, Bails also found that the average
annual growth of spending or revenue (the one to which the
TEL applies) from the year of enactment to 1985 was lower
than such growth over the period 1970 to the year of enact-
ment in only one-third of the TEL states. Bails thus con-
cluded that states' TELs "resulted in virtually no success
in limiting growth in their budgets."(12)
James Cox and David Lowery examined the change in state
spending and revenue relative to personal income in three
TEL states, Michigan, South Carolina, and Tennessee. Each
of those states was paired with a non -TEL state in its
region. The authors found that TELs did not have a statis-
tically discernible effect on the growth of government. Cox
and Lowery concluded that "by and large, the behavior of the
cap states has been similar to that of noncap states." (13)
Each of those studies identifies specific factors that
limit the effectiveness of TELs, many of which are related
to the faulty design of individual TELs. Since TELs are
often designed by politicians --the very people whose behav-
ior TELs are intended to restrain --it should come as no
2/26/98 60 4:34:02 PM
TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS... Page 6 of 28
surprise that they frequently are worded in a way that makes
their restraints as weak and easily circumvented as possi-
ble.
Despite their recognition that faulty design is often
the root of the problem, most studies that find TELs to be
ineffective do not recommend strengthening them by eliminat-
ing their flaws. Instead, the studies conclude that TELs
should be abandoned.
In contrast, there have been several studies that have
found TELs to be effective. Stephen Moore examined a vari-
ety of fiscal discipline mechanisms and found that average
state spending as a share of income in TEL states fell from
4 percent higher than the average for non -TEL states in 1979
to 10 percent lower than the average for non -TEL states by
1987.(14)
Barry Poulson found that the impact of TELs on state
spending during their first four years of existence was
negative for all [TEL] states and significant for seven of
those states.... The implication is that for these seven
states the absence of the TEL would have resulted in signif-
icantly greater increases in government expenditures in the
short run." (15)
So while there is some dispute as to whether TELs are
effective at restraining the growth of government, even the
staunchest TEL advocates will admit that TELs have not
worked as well as proponents would have liked. There is
broad agreement, however, on the importance of the design of
TELs to their effectiveness.
Methodology
This study focuses primarily on the performance of TELs
as a whole, with a few minor exceptions noted below. In
later sections, the performance of well-designed and poorly
designed TELs is compared.
To measure the effectiveness of TELs in restraining
government growth, this study examines how the growth rates
and levels of taxes and spending in states with TELs changed
after the TELs were enacted.(16) To adjust for the effect of
population changes, per capita figures were used.
Of the 23 states with TELs, 21 had enacted them by
1986. While no state enacted a TEL for the first time
between 1986 and 1990, two states, Connecticut and North
Carolina, have done so since 1990. Those two states are
excluded because there is not yet sufficient data to ade-
quately examine the effect of their TELs. In addition,
Rhode Island and Nevada are excluded because their TELs are
nonbinding, applying only to the governor's recommended
budget. Finally, Alaska is also excluded because of pecu-
2/26/98 p / 4:34:02 PM
TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS...
liarities in its budgetary structure that make comparisons
with other states problematic.(17) Unless otherwise noted,
TEL -state average" herein refers to the 18 states with
binding TELs that were enacted by 1986.(18) Table 1 lists
those states and the years of initial TEL enactment.
Table A.2 gives the growth rate of spending in each of
the 18 TEL states over the five years immediately preceding
and the five years immediately following enactment of the
TEL. The number of percentage points by which each TEL
state's spending growth rate differs from the U.S. average
growth rate over those periods is then calculated.(19)
Table 1
States with Binding TELs
State Year of Adoption
Arizona 1978
California 1979
Colorado 1977
Delaware 1980
Hawaii 1978
Idaho 1980
Louisiana 1979
Massachusetts 1986
Michigan 1978
Missouri 1980
Montana 1981
Oklahoma 1985
Oregon 1979
South Carolina 1980
Tennessee 1978
Texas 1978
Utah 1979
Washington 1979
Page 7 of 28
2/26/98
6 02
4:34:02 PM
TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS... Page 8 of 28
A TEL -state average is then found for the percentage
points by which the five-year growth rates differ from the
U.S. average. That average summarizes how the growth rate
of spending in TEL states changed relative to the growth
rate of the U.S. average after enactment of a TEL.
The same methodology is used to compare TEL -state
spending growth to the non -TEL -state average and to calcu-
late and compare per capita state taxes and per capita state
and local spending.(20) The results of those calculations for
TEL states as a group are summarized below, and a complete
list can be found in Tables A.3 -A.6 in the appendix.(21)
State Spending
Most TELs are limits on spending. So the most direct
way to evaluate the effectiveness of TELs is by examining
their impact on state expenditures. If a TEL is effective,
it should lower the growth rate of state spending. The
average growth rate of per capita state spending in TEL
states changed, relative to the U.S. average, in the follow-
ing respects after TEL enactment.
The five-year growth rate of per capita state spend-
ing in TEL states fell from 0.8 percentage points above
the U.S. average before TEL enactment to 2.9 percentage
points below the U.S. average after TEL enactment
Figure 2).
The growth rate of per capita state spending in TEL
states from the year of enactment through 1992, as
opposed to just five years after enactment, fell even
lower, to 12.1 percentage points below the U.S. aver-
age.
The five-year real growth rate of per capita state
spending in TEL states fell from 7.1 percent before TEL
enactment to 1.8 percent after TEL enactment.
If the real growth rate of per capita state spending
in TEL states had not slowed, the state spending burden
per family of four would have been, on average, $400
higher in those states five years after TEL enactment
and $450 higher in 1992 than it was with the lower rate
of spending growth.
Figure 2
Growth Rate of per Capita State Spending Relative to U.S. Ave-
erage for the Five Years Immediately Preceeding and the Five
Years Immediately Following TEL Enactment
U.S. Average = 0
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Five -Year increase in spending before TEL Enactment = 0.8%
Five -Year increase in spending after TEL Enactment = -2.9%
Graph Omitted)
Figure 3
Per Capita State Spending Relative to U.S. Average, Year of TEL
Enactment and 1992
Percentage Above
Year of Enactment 6.4%
19921.7%
Graph Omitted)
In addition to the growth rate's falling (relative to
the U.S. average), the average level of per capita
state spending in TEL states fell from 6.4 percent
above the U.S. average in the year of enactment to 1.7
percent above the U.S. average in 1992 (Figure 3).
State Taxes
Though most TELs apply to spending --of the 18 TELs
examined here, only 5 apply directly to taxes or revenue --an
effective TEL should slow the growth of state taxes as well.
The average growth rate of per capita state taxes in TEL
states changed in the following ways after TEL enactment.
The five-year growth rate of per capita state taxes
in TEL states fell from 5.5 percentage points above the
non -TEL -state average before TEL enactment to 12.5
percentage points below the non -TEL -state average after
TEL enactment (Figure 4).
The growth rate of per capita state taxes in TEL
states from the year of enactment through 1992, as
opposed to just five years after enactment, fell even
lower, to 13.2 percentage points below the non -TEL -
state average.
Figure 4
Growth Rate of per Capita State Taxes Relative to the Non -TEL -
State Average for the Five Years Immediately Preceding and the
Five Years Immediately Following TEL Enactment
U.S. Average = 0
Five -Year increase in taxes before TEL Enactment = 5.5%
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Five -Year increase in taxes after TEL Enactment = -12.5%
Graph Omitted)
The five-year real growth rate of per capita state
taxes in TEL states was 11.9 percent before TEL enact-
ment. State taxes then fell by 2.8 percent over the
five years after TEL enactment.
If real per capita tax growth in TEL states had not
been reversed --that is, if real per capita taxes had
risen 11.9 percent instead of declining 2.8 percent
over the five years following TEL enactment --a family
of four in one of the TEL states would have had to
face, on average, a state tax burden that was $650
higher five years after TEL enactment than they faced
with the lower growth rate of taxes.
As Figure 5 shows, as a result of the slower growth of
state taxes, the level of taxes in TEL states fell in rela-
tion to taxes in the rest of the country after TEL enact-
ment. Average per capita state taxes in TEL states fell
from 8.8 percent above the non -TEL -state average in the year
that TELs were enacted to 0.2 percent below it five years
later.
So in each case in which the growth rates of spending
and taxes in TEL states were compared to the U.S. and the
Figure 5
Per Capita State Taxes Relative to the Non -TEL -State Average,
Year of TEL Enactment and Five Years Later
Year of Enactment 8.8% (Above Non -TEL Average)
Five Years Later -0.2% (Below Non -TEL Average)
Graph Omitted)
non -TEL -state averages, TELs appeared to have been effective
in slowing the growth of state government --although probably
not as effective as their supporters had wished.
State and Local Spending
Many TEL critics claim that the real impact of TELs is
not in restraining the overall tax and spending burden but
in shifting it to local governments. That would presumably
defeat the purpose of the TEL. While some TELs include a
provision prohibiting the state government from shifting
costs to local governments without providing the funding to
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cover those costs, most do not. Thus, some cost shifting is
to be expected.
Incidentally, if the only impact of TELs were to shift
government responsibility --for both financing and decision-
making --to the local level, TELs might still be worthwhile.
Since local politicians are closer to the people, they are
more accountable and less likely to be able to get away with
excessive spending. Also, moving spending to the local
level more closely links the costs of public services to the
beneficiaries. In fact, many studies have found that decen-
tralized governments provide public services more efficient-
ly than do centralized governments.(22)
Nevertheless, if the purpose of TELs is to limit the
burden of government, then cost shifting may mean that those
measures are less successful than their proponents intended.
For example, if costs are fully shifted to local governments
i.e., local spending growth rises as much as state spending
growth falls), then the total state and local tax burden in
TEL states will not have fallen. And if that were the case,
though state spending growth would have fallen, it would be
misleading to conclude that the burden of government had
been reduced.
One way to check for such cost shifting is to substi-
tute per capita state and local spending for per capita
state spending and perform the same tests that were used
earlier. If a decline in state spending growth leads to a
proportional rise in local spending growth, then combined
state and local spending growth should not decline. Indeed,
both the growth and the level of state and local spending in
TEL states did decline, relative to those of the rest of the
nation, though not as dramatically as state -level spending.
The five-year growth rate of per capita state and
local spending in TEL states fell from 2.3 percentage
points above the U.S. average before TEL enactment to
1.2 percentage points below the U.S. average after TEL
enactment (Figure 6).
The growth rate of per capita state and local spend-
ing in TEL states from the year of enactment through
1991, as opposed to just five years after enactment,
fell even lower, to 10.2 percentage points below the
U.S. average.(23)
The five-year real growth rate of per capita state
and local spending in TEL states fell from 6.1 percent
before TEL enactment to 2.4 percent after TEL enact-
ment.
Figure 7 shows that, like the growth rate, the level of
state and local spending in TEL states fell (relative to the
rest of the nation) after TEL enactment. Average per capita
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state and local spending in TEL states fell from 0.1 percent
below the U.S. average in the year that TELs were enacted to
4.4 percent below it in 1991. Thus, in addition to the
burden of state government's falling after TEL enactment,
the overall burden of state and local government fell.
Figure 6
Growth Rate of per Captia State and Local Spending Relative to
U.S. Average for the Five Years Immediately Preceeding and the
Five Years Immediately Following TEL Enactment
U.S. Average = 0
Five-year increase in spending before TEL Enactment = 2.3%
Five-year increase in spending after TEL Enactment = -1.2%
Graph Omitted)
Figure 7
Per Capita State and Local Spending Relative to U.S. Average, Year
of Enactment and 1991
Year of Enactment -0.1% (Below U.S. Average)
1991 -4.4% (Below U.S. Average)
Graph Omitted)
The data suggest that, as expected, some cost shifting
to local governments has, indeed, occurred. However, the
data also show that in addition to restraining the growth of
state government, as indicated earlier, TELs have been
effective at restraining the growth of the overall burden of
state and local government.
TELs: Why Some Succeed and Others Fail
Some TELs are more effective than others in restraining
the growth rate of taxes and spending. In fact, some of the
TELs included in this analysis were conclusively ineffec-
tive --most notably, those of Louisiana, Montana, and South
Carolina (see Table A.2). The reasons some TELs succeed and
others fail can be found in their design.
There are several criteria on which TELs may vary that
can play a role in their ultimate effectiveness. (24) (Table 2
examines each of the 18 binding TELs included in this study
on five of those factors.) The major issues in determining
the effectiveness of TELs are discussed in the following
subsections.
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Did the TEL Originate with the Voters or
in the Legislature?
Where a TEL originates and who approves it differ from
state to state. Whether a TEL originates with the voters or
in the legislature can make a significant difference in its
ultimate effectiveness. TELs that originate in the legisla-
ture, since they are written by politicians --the very people
whose behavior they are intended to restrain --tend to be
more vague, less restrictive, and more easily circumvented.
In contrast, those originating with the voters usually have
more teeth. Of the 18 TELs examined, 11 originated with the
legislature and only 5 with the voters. The other two were
initiated by constitutional convention. (See Table 2 for a
state -by -state listing of who originated and who approved
the 18 TELs examined herein.)
It should be noted here, however, that in 24 states
citizens have no means by which to put an initiative or
referendum on the ballot.(25) Such measures must be initiated
by the legislature. Thus in those states, TELs that origi-
nate with the voters are not an option, although through a
legislative referendum voters can at least have the oppor-
tunity to vote on a legislature -originated TEL. (Of some
hope for those in noninitiative and referendum states is
Table 2 [Omitted]
that, in the three states where TELs were initiated by the
legislature but approved by the voters, spending growth did
fall somewhat relative to the U.S. average.) Although
severely handicapped, tax activists in noninitiative states
can pressure their legislators to come up with a sound,
well-designed TEL, in addition to pressing for a constitu-
tional change granting citizens the right to put initiatives
and referendums on the ballot.(26)
Finally, who approves the TEL is also important. Of
the 18 TELs examined, 8 were approved by the legislature and
10 by the voters. Thus, while 3 of the 11 legislature -
originated TELs were sent to the voters for approval, 8
never faced voter scrutiny, since they both originated in
and were approved by the legislature. Only five TELs were
both initiated and approved by the voters.
The same methodology used in the earlier sections
reveals that in the five states where TELs were initiated
and approved by the voters, spending growth slowed, relative
to the U.S. average, while in the eight states where they
were both initiated and approved by the legislature, spend-
ing growth actually rose, relative to the U.S. average.
The remaining five TELs were not initiated and approved by
the same people but by some combination of groups including
the voters, the legislature, and constitutional conven-
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tions.)
The five-year growth rate of per capita state spending
in voter -initiated and voter -approved TEL states fell from
6.5 percentage points above the U.S. average before TEL
enactment to 2.2 percentage points above the U.S. average
after TEL enactment, a fall of 4.3 percentage points. In
contrast, the five-year growth rate of spending in states
where TELs were both initiated and approved by the legisla-
ture rose from 2.1 percentage points below the U.S. average
before TEL enactment to 0.5 percentage points below the U.S.
average after TEL enactment, an increase of 1.6 percentage
points. These findings support Poulson's theory that TELs
initiated by the legislature "could actually erode the
budget constraint resulting in an increase in the growth of
state government."(27)
The ideal TEL would originate with and be approved by
the voters, where possible, rather than the legislature.
Is the TEL Constitutional or Statutory?
In addition to origin and approval, whether a TEL is
statutory or constitutional is important. Constitutional
TELs are difficult to change. On the other hand, statutory
TELs leave open the possibility that the legislature will
change the definition of the item limited --often by exclud-
ing certain areas of spending or revenue --or weaken the
restrictiveness of the limit itself whenever legislators see
fit. Thus, constitutional TELs are thought to be more
effective than statutory TELs. Of the 18 TELs examined
herein, 10 are constitutional and 8 are statutory. (See
Table 2 for a state -by -state list.)
Again, the same methodology gives results that indicate
that spending growth in the 10 constitutional -TEL states
fell, relative to the U.S. average, more so than in the 8
statutory -TEL states.
The five-year growth rate of per capita state spending
in constitutional -TEL states fell from 0.8 percentage points
below the U.S. average before TEL enactment to 5.6 percent-
age points below the U.S. average after TEL enactment, a
fall of 4.8 percentage points. In contrast, the five-year
growth rate of spending in statutory -TEL states fell from
2.9 percentage points above the U.S. average before TEL
enactment to 0.6 percentage points above the U.S. average
after TEL enactment, a fall of only 2.3 percentage points.
The ideal TEL would be constitutional rather than
statutory.
How Much of the Budget Is Being Limited?
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Even the most stringent TELs do not pertain to the
entire budget. Most apply solely to the general fund.
Since, on average, about 44 percent of state -appropriated
funds are outside the general fund, a substantial portion of
the budget is left uncapped.(28) In fact, in some states the
uncapped portion of the budget can be as large as 71 per-
cent.(29) Often exempted are expenditures of special funds
such as those earmarked for highways, education, and capital
construction. Among the frequently exempted revenue items
are federal aid, insurance trust funds, user fees, and
earmarked funds.
Six of the 18 TELs examined here apply to state tax
revenue.(30) Thus, those TELs do nothing to restrict the
growth of nontax revenue --charges, user fees, and the like.
Predictably, from 1980 to 1991, charges and miscellaneous
general revenue rose as a share of total general revenue
from 13.8 percent to 17.7 percent.(31)
The ideal TEL would apply a cap to 100 percent of the
budget rather than to only certain categories.
Does the TEL Cap Spending or Revenue?
Whether a TEL applies to spending or revenue can also
make a difference in its effectiveness. Of the 18 TELs
examined here, 9 apply to spending (4 to appropriations and
5 to general -fund appropriations), and 9 apply to revenue in
one way or another (3 to revenue, 2 to tax revenue, and 4 to
appropriations of tax revenue).
Each fiscal year, states must estimate their revenues
for the coming year, in part on the basis of forecasts of
how the state's economy will perform. Those economic fore-
casts, and hence the revenue estimates, are often quite
inaccurate. Further, politicians can manipulate the econom-
ic forecasts in an effort to get around their TELs' restric-
tions. Therefore, the use of revenue estimates as the base
for a TEL is not ideal.
Those pitfalls can largely be avoided, however, by
applying the TEL to spending, since the spending numbers for
the coming fiscal year are far more certain.
The ideal TEL would cap spending rather than revenue or
taxes.
What Is the Limit?
Another important factor is the definition of the limit
itself. Most TELs--including 14 of the 18 TELs examined
here --restrict state spending growth to the growth in state
personal income. A few, however, use other limits such as
population growth, inflation, or a fixed rate of growth.
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See Table 2 for more details.)
Many argue that, of the wide variety of limits in use,
those that restrict the growth of government to the rate of
growth of personal income are the most appropriate since
they prohibit the government from growing faster than the
private economy. The fact that an overwhelming majority of
TELs are so structured highlights the degree to which this
argument has been accepted.
However, the evidence suggests that linking spending to
population growth plus inflation is much more restrictive.
To illustrate the different effects of those two types of
limits --personal income linked versus population linked --
Figure 8 shows the record of the 1980s. Throughout most of
the 1980s the economy was booming, thus personal income rose
at abnormally high rates, 30 percent in real terms from 1980
to 1990. In those prosperous times, government revenues
were pouring in, allowing spending to skyrocket as well.
Real state spending shot up by 42 percent from 1980 to 1990.
Meanwhile, the U.S. population grew at only a modest rate of
10 percent.(32)
Thus, a TEL limiting spending growth to the growth rate
of personal income would have resulted in a slower rate of
state spending growth over the last decade than occurred (30
percent compared to 42 percent). However, a TEL limiting
the growth of state spending to the growth rate of popula-
tion plus inflation would have provided a far stricter limit
on real state spending growth, holding it to only 10 percent
from 1980 to 1990, less than one-fourth the 42 percent rate
at which it actually grew and one-third the rate at which a
personal income -linked TEL would have allowed spending to
Figure 8
Growth in Population, Real Personal Income, and Real State
Spending, 1980-90
1980-90 Growth
Population 10%
Real Personal Income 30%
Real State Spending 42%
Graph Omitted)
grow. Thus, TELs limiting spending growth to the growth
rate of population plus inflation are far preferable if the
goal is to tame spending.
In fact, one of the reasons many studies have found
TELs ineffective is that so many TELs are linked to personal
income growth --which is hardly a restrictive limit. Since
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most TELs were in place by 1982, the evidence on spending
growth since TEL enactment comes largely from the period of
the 1980s when rapid growth of income accommodated the surge
in spending.
For example, South Carolina has a personal income -
linked TEL. The five-year growth rate of spending in South
Carolina rose from 18.7 percentage points below the U.S.
average before TEL enactment to 3.0 percentage points above
the U.S. average after TEL enactment. By contrast, the
five-year growth rate of spending in California, which has a
population- and inflation -linked TEL, fell from 9.4 percent-
age points above the U.S. average before TEL enactment to
5.9 percentage points below the U.S. average after TEL
enactment.
The ideal TEL would limit the growth of spending to the
growth rate of the population plus inflation rather than to
the growth of personal income.
Can the TEL's Restrictions Be Circumvented?
How easily politicians can get around the limits of a
TEL is an important factor in determining how successful
that TEL will be at restraining the growth of government.
At the very least, the TEL should be binding. In two cases
the limit applies only to the governor's recommended budget
and thus has virtually no teeth. (Nevada and Rhode Island
have such nonbinding TELs, so as mentioned earlier, they
were not included as TEL states in this study.)
Of the other TELs, only Oklahoma's does not provide
some mechanism by which the legislature can waive the re-
strictions of the TEL. Nine of the 18 TELs examined here
first require the declaration of an "emergency." However,
no state has specified what constitutes an emergency.(33) Of
the 18, 6 require only a majority vote to waive their TELs;
1 requires three-fifths approval; 9 require two-thirds ap-
proval; 1 requires two-thirds approval plus compensating
reductions over the following three years; and 1 has no
waiver provisions. (See Table 2 for more details.)
The ideal TEL would require voter approval for its
provisions to be circumvented.
Does the TEL Allow Cost Shifting to Local Governments?
Since the goal of a TEL is to restrict the growth of
government, if state governments adhere to their TELs by
shifting costs to local governments, the overall size of
government will not have been restrained. In an effort to
foil such attempts to ignore the true intent of TELs, 5 of
the 18 TEL states examined here have adopted TELs that
prohibit state governments from imposing unfunded mandates
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on local governments.(34)
Since localized government is preferable to centralized
government, a prohibition of unfunded mandates, which by
itself could prohibit such decentralization, may not be
desirable. To address that, four of the five TELs that
prohibit unfunded mandates do allow for transfer of respon-
sibility --for both program financing and decisionmaking--to
local governments. In those cases, the state spending limit
is then adjusted downward.
Since most TELs do not apply to local governments, such
decentralization could, through a disproportionate expansion
in local government spending, lead to an increase in the
overall level of state and local government spending. To
prevent such expansion, TELs should apply to local govern-
ments as well.
Colorado's Taxpayer Bill of Rights, passed in 1992, is
a recent example of a TEL that applies to both state and
local governments. Several of the prospective 1994 ballot
measures do so as well.
The ideal TEL would apply to both state and local
governments. And it would allow for transfer of responsi-
bility to local governments and provide for the appropriate
adjustments in each jurisdiction's limit.
Does the TEL Require Additional
Action to Be Implemented?
The manner in which a TEL is to be implemented is also
of considerable importance. If the legislature must take
additional action to make the TEL operative, it can create a
major roadblock in the path toward fiscal restraint. Unfor-
tunately, in several instances that has been the case.
For example, in Connecticut, as part of the 1991 deal
to enact a new state income tax, Gov. Lowell Weicker agreed
to a statutory TEL limiting the growth in general budget
expenditures to the percentage increase in personal income
or inflation (whichever was higher). A similar measure was
passed as a constitutional amendment in 1992. However, the
measure required that the general assembly define "general
budget expenditures," "increase in personal income," and
increase in inflation." The legislature has thus far
refused to define those terms, and the state's attorney
general has ruled that until they do, the TEL is inopera-
tive. Therefore, because of poorly designed implementation
provisions, a TEL that voters approved by a four -to -one
margin remains impotent.(35)
The ideal TEL would require no additional action by the
legislature for implementation.
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How Is the TEL Enforced?
Finally, enforceability plays a major role in determin-
ing the effectiveness of fiscal discipline mechanisms. If a
TEL is not adhered to, it ceases to be useful. Thus, a TEL
should clearly articulate what is to take place should the
government violate the dictates of the TEL. Unfortunately,
that is rarely the case. As a result, several states have
simply ignored their TELs.
A case in point is Texas, where a constitutional TEL
was passed by an overwhelming 84 percent majority in 1978.
The TEL was adhered to in the first biennium to which it
applied, but it has been ignored ever since.(36) While the
Texas constitution is fairly clear on the precise course to
be taken in the case of a violation of budgetary laws such
as this one, the specific wording of the TEL itself does not
mention enforcement mechanisms. In part as a result of
that, the Texas Public Policy Foundation reports that "the
Texas Reform Act is probably being violated at almost every
level of the budget process," leading the legislature's
biennial appropriations to exceed their limit by as much as
1.5 billion.(37)
To avoid that sort of enforceability problem, the text
of a TEL should clearly state that taxpayers have legal
standing to sue to enforce the TEL's provisions.(38) In addi-
tion, TELs should require injunctive relief to prevent the
illegal collection of taxes or appropriation of expenditures
while suit is pending. Missouri's Hancock II, an initiative
seeking 1994 ballot status, is an example of a TEL that
contains such provisions.(39)
The ideal TEL should give taxpayers standing to sue to
enforce its provisions and require injunctive relief to
prohibit any illegal taxes or spending while such suits are
pending.
The Ideal TEL
The ideal TEL should have the following characteris-
tics.(40)
1. It should originate with and be approved by the
voters, where possible, rather than the legislature.
2. It should be constitutional rather than statutory.
3. It should apply a cap to 100 percent of the budget
rather than to only certain categories.
4. It should cap spending rather than revenue or taxes.
5. It should limit the growth of spending to the growth
rate of population plus inflation rather than to the
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growth of personal income.
6. It should require voter approval for its provisions
to be circumvented.
7. It should apply to both state and local governments.
And it should allow for transfer of responsibility to
local governments and provide for the appropriate
adjustments in each jurisdiction's limit.
8. It should not require additional action by the
legislature for implementation.
9. It should give taxpayers standing to sue to enforce
its provisions and require injunctive relief to prohib-
it any illegal taxes or spending while suit is pending.
Do TELs Have a Useful Life Span?
It is often argued that TELs are less effective over
the long run than they are when first implemented. Part of
the reason for that is that many TELs are statutory and can
be amended by the legislature at any time. Thus, since TELs
are often weakened over time --through exclusions of addi-
tional areas of spending or revenue to which the limit
applies or through outright alterations of the limit it-
self --it is expected that their effectiveness will decline
as well.
Examination of the 15 binding TELs in place by 1980
indicates that spending growth is indeed restrained more
over the first five years after TEL enactment than over the
second five years.(41) The real growth rate of per capita
state spending in the 15 states with binding TELs in place
by 1980 was 3.5 percentage points below the U.S. average
from 1980 to 1985 (6.3 percent vs. 9.8 percent) but 0.4
percentage points above the U.S. average from 1985 to 1990
16.7 percent vs. 16.3 percent).
California --where a constitutional TEL was enacted in
1979 --is one example of a state whose TEL has substantially
lost effectiveness over time, as more and more spending has
been moved outside the purview of the limit. For example,
Proposition 98, passed in 1988, required that a large por-
tion of the state budget go to education, in effect crowding
out spending on other things such as streets, highways,
sewers, and police protection. The resulting demands for
more spending on those areas were then often met with spe-
cific earmarked local taxes, thus increasing the overall
burden of state and local government. Further, Proposition
99 increased the cigarette tax but excluded that revenue
from the general fund, designating it instead for grants to
health organizations, thus exempting it from the TEL's
cap.(42) As a result, despite the presence of a constitution-
al TEL, state spending in California continued to rise
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dramatically throughout the 1980s.
The erosion of TEL effectiveness over time can be
linked in part to the culture of spending in state capitals,
in which politicians will do whatever it takes to avoid
having their spending powers restrained. However, it can
also be traced to poor design. A major loophole in every
existing TEL is the lack of a cap applying to the entire
budget.
For instance, California's TEL applied only to "appro-
priations of state tax revenue." Others apply only to
state general fund appropriations." As a result, govern-
ment can be and has been expanded in such states, despite
the presence of a TEL, by increasing nontax revenue (e.g.,
charges and user fees) and excluding certain categories of
spending from the general fund. That loophole is probably
the single biggest contributor to the limited effectiveness
of TELs, especially over time.
Perhaps the most important factor in preventing the
erosion of the effectiveness of a TEL is making sure that
the language of the TEL clearly states that the cap applies
to "100 percent of state expenditures." Inclusion of that
language and the other characteristics of the ideal TEL
outlined in the preceding section would go a long way toward
ensuring that TELs do indeed have a long useful life span.
Other Measures of Fiscal Restraint
Well-designed TELs can impose significant fiscal re-
straint on a state's budgetary process. However, other
useful measures exist as well. Two such measures are super -
majority requirements and voter approval requirements for
increasing existing taxes or imposing new taxes. Table 3 is
a list of the states that have at least one of those three
including TELs) measures of fiscal restraint.
Supermajority Requirements for
New or Increased Taxes
By requiring more than a simple majority (usually a
two-thirds majority) to raise existing taxes or impose new
ones, supermajority requirements force legislators to reach
a broader consensus on the necessity for higher taxes and
the wisdom of the spending those taxes will fund.(43) A more
sound fiscal policy is the likely result. Nine states have
such requirements, two of which were enacted in 1992. In
1994 voters in two states --Montana and Nevada --may have the
opportunity to pull the lever in support of supermajority
requirements. (44)
Voter Approval Requirements for
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New or Increased Taxes
Another fairly new fiscal discipline measure requires
voter approval to increase existing taxes or impose new
ones. In March 1992 Oklahoma kicked off this popular and
populist movement by passing a constitutional amendment that
requires voter approval of any tax hike that does not pass
each house of the legislature by at least a three-fourths
vote. Colorado went even further in November 1992 with
passage of the Taxpayer Bill of Rights, a constitutional
amendment that requires voter approval of any increase in
Table 3 [Omitted]
state or local taxes. In 1994 there may be as many as five
state ballot initiatives that would require voter approval
for new or increased taxes.(45)
Voter approval requirements (VARs) have the further
appeal of reconnecting the voters with their governments.
Politicians who wish to raise taxes now have to convince
only their fellow legislators of the wisdom of such a move.
With a VAR, however, would-be tax -hiking politicians would
have to take their case to the people. They would be forced
to convincingly explain to their constituents why the money
is needed and where it will be spent. That is rarely easy.
Of course, VARs are not without their weaknesses. For
example, since most VARs merely restrict the growth of tax
rates, they would do nothing to prohibit the growth of
nontax revenue.(46) As mentioned earlier, charges, fees, and
miscellaneous general revenues have been growing as a share
of total general revenue. Thus, the restrictions of most
VARs could be circumvented by continuing to increase those
types of revenues.
Still, measures that require voter approval for in-
creasing existing taxes or imposing new ones provide a
powerful method to restrain the growth of state government.
Further, VARs are very popular with voters. A recent na-
tional poll found that 66 percent of Americans favor requir-
ing tax increases to be approved by a majority vote of the
people.(47) The popular appeal of VARs makes it probable that
they will follow the path of the term -limits movement. That
is, they will most likely pass by wide margins everywhere
they are on the ballot in 1994 and be adopted by many more
states in the years to come.
Conclusion
TELs, as we know them, are no silver bullet. Even
their staunchest supporters will admit that TELs have not
slowed the growth of taxes and spending as much as their
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TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS... Page 23 of 28
advocates would have liked. Some TELs, in fact, have been
clearly ineffective. However, the ineffective TELs tend to
be the ones that are plagued by specific elements of poor
design. For example, they are usually statutory rather than
constitutional and thus are designed by the very politicians
whose behavior they are intended to restrain. As a result,
the cap frequently excludes large areas of the budget, and
the TEL is often written in a manner that makes circumvent-
ing or even changing its limit quite easy.
Nevertheless, as this study has shown, TELS--despite
their substantial flaws --can work. They can slow the rate
of growth of taxes and spending, relative to the rest of the
nation, and they can do so without shifting massive costs to
local governments. In addition, though all existing TELs
have notable flaws that limit their effectiveness, the
better designed TELs are much more effective than are those
that are designed poorly. Furthermore, TELs with the fea-
tures of the ideal TEL described herein would have an even
greater impact.
This fall voters in as many as six states will have the
opportunity to pass some type of tax limitation measure.
People opposed to TELs--career politicians, lobbyists, and
others --will go to great lengths to scare voters into think-
ing TELs are damaging. The evidence presented here suggests
just the opposite. By restraining the ability of politi-
cians to continue to allow taxes and spending to grow un-
checked, TELs can finally provide the beleaguered taxpayer
some much-needed relief from the crushing burden of state
taxes.
Appendix: Detailed Tables
The tables in this appendix provide more detailed
information on TELs. Tables A.3 through A.6 give the re-
sults of four different measures of changes in taxing and
spending.
Tables A.1 - A.6 Omitted
Notes
1) U.S. Department of Commerce, Bureau of the Census, State
Government Finances, 1980 and 1992 editions.
2) Several of the measures --the ones that require either a
supermajority in the legislature or a majority of the voters
to approve new or increased taxes --are not, strictly speak
ing, TELs. Herein, TELs refers to measures that limit the
growth of revenue or expenditures by a specific formula
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TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS... Page 24 of 28
usually involving the growth of personal income or popula
tion).
3) According to Americans for Tax Reform, information is
correct as of July 11, 1994. Those states in which signa
tures are being gathered to put some form of tax limitation
measure on the 1994 ballot are Florida, Missouri, Montana,
Nevada, North Dakota, and Oregon. At this writing, the
Oregon and Nevada initiatives have already achieved ballot
status. (Note that three of those statesMissouri, Mon
tana, and Oregonalready have TELs in place.)
4) U.S. Advisory Commission on Intergovernmental Relations,
Significant Features of Fiscal Federalism (Washington: ACIR,
1993), vol. 2, pp. 5354; U.S. Department of Commerce,
Bureau of the Census, Historical Statistics of the United
States, Colonial Times to 1970, part 2, pp. 111920, 1130;
and Office of Management and Budget, Economic Report of the
President, February 1994, p. 305.
5) U.S. Advisory Commission on Intergovernmental Relations,
vol. 2, p. 82.
6) For more details on the recent growth of state govern
ment, see Stephen Moore, "State Spending Splurge: The Real
Story behind the Fiscal Crisis in State Government," Cato
Institute Policy Analysis no. 152, May 23, 1991.
7) Paul Gigot, "Voters to Bill: Do You Want to Be Flor
ioed?" Wall Street Journal, November 5, 1993, p. A8.
8) Terry Schwadron and Paul Richter, California and the
American Tax Revolt: Proposition 13 Five Years Later (Berke
ley: University of California Press, 1984), p. 6.
9) Information on the existence of TELs in specific states
came from U.S. Advisory Commission on Intergovernmental
Relations, 1986, 1991, 1992, 1993, vol. 1.
10) Daphne Kenyon and Karen Benker, "Fiscal Discipline:
Lessons from the State Experience," National Tax Journal 37,
no. 3 (September 1984): 438.
11) Marcia Howard, "State Tax and Expenditure Limitations:
There Is No Story," Public Budgeting and Finance, Summer
1989, p. 87.
12) Dale Bails, "The Effectiveness of TaxExpenditure Limi
tations: A Reevaluation," American Journal of Economics and
Sociology 49, no. 2 (April 1990): 223.
13) James Cox and David Lowery, "The Impact of the Tax
Revolt Era: State Fiscal Caps," Social Science Quarterly 71,
no. 3 (September 1990): 507.
14) Stephen Moore, "What the States Can Teach Congress about
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TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS... Page 25 of 28
Balancing the Budget," Heritage Foundation Backgrounder no.
751, February 1990, p. 10.
15) Barry Poulson, "The Rules of the Game: Designing a State
Fiscal Constitution," in The Crisis in America's State
Budgets: A Blueprint for Budget Reform, ed. John Berthoud
and Samuel Brunelli (Washington: American Legislative Ex
change Council, 1993), p. 133.
16) Information on TELs is from U.S. Advisory Commission on
Intergovernmental Relations, 1986, 1991, 1992, 1993, vol. 1.
The state tax and spending figures are from U.S. Department
of Commerce, Bureau of the Census, State Government Financ
es, various editions. The state and local spending figures
are from U.S. Department of Commerce, Bureau of the Census,
Government Finances, various editions.
17) Alaska gets a disproportionate share of its revenue from
severance taxes, mostly on oil sold to nonAlaskans (22
percent of general revenue in 1992). The amount of revenue
from those taxes fluctuates highly; thus, in comparison with
other states, Alaska's overall levels of taxes and spending
fluctuate highly as well. For instance, from 1986 to 1991
per capita state taxes in Alaska went down (in nominal
terms) by 9 percent, while the U.S. average rose 30 percent.
Including those numbers would skew the TEL -state group
average significantly downward (thus making a stronger case
for the effectiveness of TELs). Figures from Alaska are
excluded from all "nonTEL-state" group averages as well.
18) Although New Jersey enacted a TEL in 1976, it was by law
temporary, expiring in 1983. Thus, New Jersey is not in
cluded as a TEL state, nor is it included as a nonTEL state
for any of the years during which its TEL was in effect
1976 to 1983).
19) Since this involves comparisons between growth rates
over the same period of analysis, nominal dollars are used.
20) "NonTEL states" refers to the group of states (differ
ent for each year of enactment) that did not have a binding
TEL in place for any portion of the relevant period of
analysis. Note that nonTEL states thus include both Rhode
Island and Nevada (states with nonbinding TELs) but, as
mentioned earlier, not Alaska.
2 1) More detailed tables for all calculations for all states
similar to Table A.2), as opposed to just TEL -state average
figures (as in Tables A.3 -A.6), can be obtained from the
author.
22) A list of some of those studies can be found in Sam
Staley, "Bigger Is Not Better: The Virtues of Decentralized
Local Government," Cato Institute Policy Analysis no. 166,
January 21, 1992. See also Stephen Moore and Dean Stansel,
The Myth of America's Underfunded Cities," Cato Institute
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TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS... Page 26 of 28
Policy Analysis no. 188, February 22, 1993.
23) The most recent year for which state and local spending
data are available is 1991.
24) For a l Opoint checklist for evaluating the potential
effectiveness of individual TELs, see Poulson, p. 10. For a
more detailed contemporary discussion of the expected diffi
culties in implementing effective TELs due to their design,
see Naomi Caiden, "Problems in Implementing Government
Expenditure Limitations, appendix C in Aaron Wildaysky, How
to Limit Government Spending (Berkeley: University of Cali
fornia Press, 1980), pp. 14362.
25) Patrick McGuigan, "The Conservative Activist's Primer on
Direct Democracy," in Making Government Work: A Conserva
tive Agenda for the States, ed. Tex Lezar (San Antonio:
Texas Public Policy Foundation, 1992), p. 402.
26) The National Referendum Movement, a newly formed group
in Memphis, Tennessee, headed by Barbara Vincent, is seeking
to obtain the right to initiative, referendum, and recall in
states that do not have it by working with grassroots organ
izations in those states to petition the courts to put
initiative, referendum, and recall on the ballot.
27) Poulson, p. 35. See also Barry Poulson and Jay Kaplan,
A Rent -Seeking Model of TELs," Public Choice 79 (1994):
117-34.
28) "Tax and Expenditure Limits," in The Source Book of
American State Legislation 199394, A Question of Disci
pline: A Guide to Fiscal Responsibility, ed. Samuel Brunelli
and John Berthoud (Washington: American Legislative Exchange
Council), p. 32.
29) Howard, pp. 87-88.
30) Note that four of those six apply specifically to "ap
propriations of state tax revenue."
3 1) U.S. Advisory Commission on Intergovernmental Relations,
1993, vol. 2, p. 71.
32) U.S. Advisory Commission on Intergovernmental Relations,
1993, vol. 2, pp. 24, 53; and Office of Management and Bud
get, p. 305.
33) Dale Bails, "A Critique on the Effectiveness of Tax
Expenditure Limitations," Public Choice 38, no. 2 (1982):
12938.
34) Those states are California, Michigan, Missouri, Tennes
see, and Washington.
35) See Jeffrey Christensen, "Weicker's World," National
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TAMING LEVIATHAN: ARE TAX AND SPENDING LIMITS... Page 27 of 28
Review, January 24, 1994, p. 26; and Theodore Olson, "A
TaxandSpend Legislature Ignores the Voters," Wall Street
Journal, November 24, 1993, p. A 17.
36) Michael Weiss, "The Texas Tax Relief Act after 12 Years:
Adoption, Implementation, and Enforcement," Texas Public
Policy Foundation, San Antonio, August 1991, p. 4.
37) Ibid., pp. 11, 5.
38) According to Weiss, "Currently, every state except New
Mexico permits [taxpayer suits]" (p. 18n. 73). For a fuller
discussion of the matter, see ibid., pp. 810.
39) Hancock II is an attempt to eliminate some of the loop
holes of the original Hancock amendment, passed in 1980,
which gave taxpayers standing to sue but did not require
injunctive relief.
40) For a sample tax and expenditure limitation act designed
by the American Legislative Exchange Council (ALEC), see
Tax and Expenditure Limits," pp. 3740. ALEC's model TEL
does exclude certain areas of spending; nevertheless, it
generally shares the spirit of the recommendations made
herein. Furthermore, it spells out in detail what the text
of a TEL should look like, which could prove useful to
grassroots organizers seeking to put a TEL initiative on the
ballot in their state.
41) Those 15 states are Arizona, California, Colorado,
Delaware, Hawaii, Idaho, Louisiana, Michigan, Missouri,
Oregon, South Carolina, Tennessee, Texas, Utah, and Washing
ton.
42) Steven Hayward, "Conditions Are Building for Another Tax
Revolt," Los Angeles Daily News, October 24, 1993,
pp. 3132.
43) Ironically, on the federal level Congress has adopted a
supermajority rule for cutting taxes but only a simple
majority rule for raising taxes. However, there is now a
proposal by Rep. Jim Saxton (R-N.J.) in Congress to require
a three-fifths vote to raise taxes.
44) Americans for Tax Reform.
45) Ibid. The five initiatives would be in Florida, Missou
ri, Montana, North Dakota, and Oregon.
46) Some of the VARs seeking ballot status in 1994 would
specifically require voter approval for increased or new
taxes or fees."
47) Kevin Merida, "Americans Want a Direct Say in Political
DecisionMaking, Pollsters Find," Washington Post, April 20,
1994, p. A19.
WJPA
i
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