Advancing Racial Equity With State Tax Policy
End Notes
[1] Today, 16 states have some form of supermajority requirement to raise revenue, including states with statutory (as opposed to constitutional) requirements. In January 2019, Florida will implement a new constitutional supermajority requirement to raise revenues, expanding an existing requirement that is more narrowly targeted to increases in corporate income tax rates. See Center on Budget and Policy Priorities, “Policy Basics: State Supermajority Rules to Raise Revenue,” updated February 5, 2018, https://www.cbpp.org/research/state-budget-and-tax/policy-basics-state-supermajority-rules-to-raise-revenues.
[2] Today, 44 states and the District of Columbia impose some kind of limit on property taxes. See Iris J. Lav and Michael Leachman, “State Limits on Property Taxes Hamstring Local Services and Should Be Relaxed or Repealed,” Center on Budget and Policy Priorities, July 18, 2018, https://www.cbpp.org/research/state-budget-and-tax/state-limits-on-property-taxes-hamstring-local-services-and-should-be.
[3] For a list of which states adopted retail sales taxes, and when, see W. Bartley Hildreth and James A. Richardson, eds., Handbook on Taxation, Marcell Dekker, Inc., New York, 1999, p. 73.
[4] Racial inequities that impede people of color’s ability to take maximum advantage of their innate abilities can limit overall productivity and economic growth. See Chang-Tai Hsieh et al., “The Allocation of Talent and U.S. Economic Growth,” April 6, 2018, Version 5.0, https://web.stanford.edu/~chadj/HHJK.pdf. One measure of inequity, the racial wage gap, tends to be larger in states where surveys show greater racial prejudice. See Kerwin Kofi Charles and Jonathan Guryan, “Prejudice and the Economics of Discrimination,” NBER Working Paper No. 13661, December 2007, https://www.nber.org/papers/w13661. Recent research suggests that lower levels of inequality are associated with stronger economic growth, and redistributive public policies seem benign in their impact on growth, at least unless they are extreme in their impact. While this research is not definitive, it is strongly suggestive. See Ostry et al., “Redistribution, Inequality, and Growth,” International Monetary Fund, April 2014, https://www.imf.org/external/pubs/ft/sdn/2014/sdn1402.pdf. See also Heather Boushey and Carter C. Price, “How are economic inequality and growth connected?,” Washington Center for Equitable Growth, October 2014, https://equitablegrowth.org/economic-inequality-growth-connected/.
[5] This paper often refers to racial and ethnic equity rather than just racial equity to acknowledge that some people of color identify more with their ethnic heritage than with a racial group.
[6] See, for example, C. Kirabo Jackson, Rucker C. Johnson, and Claudia Persico, “The Effects of School Spending on Educational and Economic Outcomes: Evidence from School Finance Reforms,” Quarterly Journal of Economics, October 1, 2015.
[7] See Michael Mitchell et al., “Unkept Promises: State Cuts to Higher Education Threaten Access and Equity,” Center on Budget and Policy Priorities, October 4, 2018, https://www.cbpp.org/research/state-budget-and-tax/unkept-promises-state-cuts-to-higher-education-threaten-access-and.
[8] See, for example, Chuck Marr et al., “EITC and Child Tax Credit Promote Work, Reduce Poverty, and Support Children’s Development, Research Finds,” Center on Budget and Policy Priorities, updated October 1, 2015, https://www.cbpp.org/research/federal-tax/eitc-and-child-tax-credit-promote-work-reduce-poverty-and-support-childrens; Elizabeth Wolkomir, “SNAP Boosts Retailers and Local Economies,” Center on Budget and Policy Priorities, updated April 6, 2018, https://www.cbpp.org/research/food-assistance/snap-boosts-retailers-and-local-economies; Barbara Sard et al., “Federal Policy Changes Can Help More Families with Housing Vouchers Live in Higher-Opportunity Areas,” September 4, 2018, https://www.cbpp.org/research/housing/federal-policy-changes-can-help-more-families-with-housing-vouchers-live-in-higher.
[9] See, for example, Center on Budget and Policy Priorities, “Chart Book: The Far-Reaching Benefits of the Affordable Care Act’s Medicaid Expansion,” October 2, 2018, https://www.cbpp.org/research/health/chart-book-the-far-reaching-benefits-of-the-affordable-care-acts-medicaid.
[10] Hsieh et al., 2018; Charles and Guryan, 2007; Ostry et al., 2014; Boushey and Price, 2014.
[11] For more on the racial wealth gap, see for example William Darity et al., “What We Get Wrong About Closing the Racial Wealth Gap,” Samuel DuBois Cook Center on Social Equity & Insight Center for Community Economic Development, April 2018, https://socialequity.duke.edu/sites/socialequity.duke.edu/files/site-images/FINAL%20COMPLETE%20REPORT_.pdf, and Thomas Shapiro, Tatjana Meschede, and Sam Osoro, “The Roots of the Widening Racial Wealth Gap: Explaining the Black-White Economic Divide,” Institute on Assets and Social Policy, Research and Policy Brief, February 2013, https://iasp.brandeis.edu/pdfs/Author/shapiro-thomas-m/racialwealthgapbrief.pdf.
[12] For the latest Census data on household income by race, see https://www.census.gov/library/publications/2018/demo/p60-263.html. See also Erica Williams, “States Should Adopt Policies to Help Dismantle Racial Barriers to Broader Prosperity, Center on Budget and Policy Priorities, September 13, 2018, https://www.cbpp.org/blog/states-should-adopt-policies-to-help-dismantle-racial-barriers-to-broader-prosperity.
[13] Edward N. Wolff, “Household Wealth Trends in the United States, 1962-2016: Has Middle Class Wealth Recovered?” NBER Working Paper No. 24085, Table 2, http://www.nber.org/papers/w24085.
[14] CBPP analysis of data from the 2016 Survey of Consumer Finances. Demos did a similar analysis using the 2013 SCF data here: https://www.demos.org/blog/9/5/14/top-10-white-families-own-almost-everything.
[15] Jess Gilbert, Spencer D. Wood, and Gwen Sharp, “Who Owns the Land? Agricultural Land Ownership by Race/Ethnicity,” Rural America, U.S. Department of Agriculture, Winter 2002, Vol. 17, Issue 4, pp. 55-62.
[16] Michael McManus, “Minority Business Ownership: Data from the 2012 Survey of Business Owners,” U.S. Small Business Administration Office of Advocacy, Issue Brief No. 12, September 14, 2016, https://www.sba.gov/sites/default/files/advocacy/Minority-Owned-Businesses-in-the-US.pdf.
[17] People who identify with a Latin American or Hispanic ethnicity may prefer to be identified in various ways including as Hispanic, Latino, Latina, Latinx, or with a more specific country of origin. In this report we use the gender-neutral term “Latinx.” We also use “Hispanic” where appropriate, for instance in cases when a data source uses that term.
[18] Lisa J. Dettling et al., “Recent Trends in Wealth-Holding by Race and Ethnicity: Evidence from the Survey of Consumer Finances,” The Federal Reserve, FEDS Notes, September 27, 2017, https://www.federalreserve.gov/econres/notes/feds-notes/recent-trends-in-wealth-holding-by-race-and-ethnicity-evidence-from-the-survey-of-consumer-finances-20170927.htm.
[19] Christian E. Weller and Jeffrey Thompson, “ Wealth Inequality Among Asian Americans Greater Than Among Whites,” Center for American Progress, December 20, 2016, https://www.americanprogress.org/issues/race/reports/2016/12/20/295359/wealth-inequality-among-asian-americans-greater-than-among-whites/.
[20] See Valerie Wilson and Zane Mokhiber, “2016 ACS shows stubbornly high Native American poverty and different degrees of economic well-being for Asian ethnic groups,” Economic Policy Institute, September 15, 2017, https://www.epi.org/blog/2016-acs-shows-stubbornly-high-native-american-poverty-and-different-degrees-of-economic-well-being-for-asian-ethnic-groups; and Jay L. Zagorsky, “Native Americans’ Wealth,” Chapter 5 in Gordon Nembhard and Chiteji (eds.), Wealth Accumulation and Communities of Color in the United States: Current Issues, University of Michigan Press, 2006.
[21] See Rakesh Kochhar and Anthony Cilluffo, ”How wealth inequality has changed in the U.S. since the Great Recession, by race, ethnicity and income,” Pew Research Center, November 1, 2017, http://www.pewresearch.org/fact-tank/2017/11/01/how-wealth-inequality-has-changed-in-the-u-s-since-the-great-recession-by-race-ethnicity-and-income/.
[22] For instance, between 1887 and 1934, after the passage of the Dawes Act, some 86 million acres of land owned by Native Americans was given to non-Indians. See Judith Nies, Native American History, Ballantine Books, 1996, p. 295. See also Roxanne Dunbar-Ortiz, An Indigenous Peoples’ History of the United States, Beacon Press, 2014, pp. 157-161.
[23] See, for example, Richard Rothstein, The Color of Law: A Forgotten History of How Our Government Segregated America, Liveright, 2017.
[24] This research is summarized in New York Times Editorial Board, “How Segregation Destroys Black Wealth,” September 15, 2015, https://www.nytimes.com/2015/09/15/opinion/how-segregation-destroys-black-wealth.html.
[25] Margery Austin Turner et al., Housing Discrimination and Racial and Ethnic Minorities 2012, Prepared for the U.S. Department of Housing and Urban Development, June 2013, https://www.huduser.gov/portal/Publications/pdf/HUD-514_HDS2012.pdf.
[26] Lincoln Quillian et al., “Meta-analysis of field experiments shows no change in racial discrimination in hiring over time,” Proceedings of the National Academy of Sciences, September 12, 2017, http://www.pnas.org/content/early/2017/09/11/1706255114?sid=5ac32c31-b27d-4db5-b50f-0fe04298c38b.
[27] Marianne Bertrand and Sendhil Mullainathan, Are Emily and Greg More Employable than Lakisha and Jamal? A Field Experiment on Labor Market Discrimination, NBER Working Paper No. 9873, July 2003, http://www.nber.org/papers/w9873.
[28] Devah Pager, Bruce Western, and Bart Bonikowski, Discrimination in a Low-Wage Labor Market: A Field Experiment, IZA Discussion Paper No. 4469, October 2009, http://ftp.iza.org/dp4469.pdf.
[29] See examples of this research in Cheryl Staats et al., “State of the Science: Implicit Bias Review,” Kirwan Institute, 2016, http://kirwaninstitute.osu.edu/wp-content/uploads/2016/07/implicit-bias-2016.pdf.
[30] See, for example, Cheryl Staats et al., “State of the Science: Implicit Bias Review,” Kirwan Institute, 2017, http://kirwaninstitute.osu.edu/implicit-bias-training/resources/2017-implicit-bias-review.pdf; National Initiative for Building Community Trust and Justice, “Implicit Bias,” https://trustandjustice.org/resources/intervention/implicit-bias; and Center for Family Policy and Practice, “Racial Stereotypes Can Affect Case Management Decisions,” October 5, 2012, https://cffpp.org/racial-stereotypes-can-affect-case-management-decisions-october-5-2012/.
[31] Official proceedings, Day 2 – Alabama Legislature, May 22, 1901, available at http://www.legislature.state.al.us/aliswww/history/constitutions/1901/proceedings/1901_proceedings_vol1/day2.html.
[32] For national population by race in 1970, see Campbell Gibson and Kay Jung, “Historical Census Statistics on Population Totals by Race, 1790 to 1990, and by Hispanic Origin, 1970 to 1990, for the United States, Regions, Divisions, and States,” Population Division Working Paper No. 56, September 2002, https://www.census.gov//content/dam/Census/library/working-papers/2002/demo/POP-twps0056.pdf. For estimate of state lawmakers by race in 1971, see Karl Kurtz, “Who We Elect: The Demographics of State Legislatures,” National Conference of State Legislatures, December 1, 2015, http://www.ncsl.org/research/about-state-legislatures/who-we-elect.aspx.
[33] See Kurtz, “Who We Elect,” race/ethnicity data spreadsheet available at http://www.ncsl.org/Portals/1/Documents/About_State_Legislatures/Raceethnicity_Rev2.pdf. See also New American Leaders Project, “States of Inclusion: New American Journeys to Elected Office,” 2016, https://www.newamericanleaders.org/wp-content/uploads/2017/05/States-of-Inclusion-FINAL-12516.pdf. For the U.S. population by racial/ethnic categories see U.S. Census Bureau Quick Facts at https://www.census.gov/quickfacts/fact/table/US/PST045217.
[34] Karen Shanton, “The Problem of African American Underrepresentation in City Councils,” Demos, 2014, https://www.demos.org/sites/default/files/publications/Underrepresentation_0.pdf.
[35] One study reports that before the Civil War began the owner of a 160-acre farm paid about $2.05 in taxes in Alabama and about $1.78 in Mississippi. Once Reconstruction was firmly underway, the same Alabama farmer paid about $4.57 (in 1870) and the Mississippi farmer paid about $6.31 (in 1871). J. Mills Thornton III, “Fiscal Policy and the Failure of Radical Reconstruction in the Lower South,” in Region, Race, and Reconstruction: Essays in Honor of C. Vann Woodward, edited by J. Morgan Kousser and James M. McPherson, Oxford University Press, New York, 1982.
[36] Eric Foner, “Reconstruction: America’s Unfinished Revolution, 1863–1877,” 2014 (updated version), HarperPerennial, 2014.
[37] See Albert D. Kirwin, Revolt of the Rednecks: Mississippi Politics 1876-1925, University of Kentucky Press, 1951, pp. 79-84. Some delegates favoring reapportionment may have sought it primarily to reduce the political dominance of whites in the Delta region, but some also argued it was necessary as a bulwark against the reemergence of African American political power, particularly given uncertainty as to whether the federal courts would allow the voting restrictions to stand.
[38] Dorothy Overstreet Pratt, Sowing the Wind: The Mississippi Constitutional Convention of 1890, University Press of Mississippi, 2018, p. 130-131. See also Michael Perman, Struggle for Mastery: Disenfranchisement in the South, 1888-1908, University of North Carolina Press, 2001, p. 82.
[39] Today, 16 states have some form of supermajority requirement to raise revenue, including states with statutory requirements. In January 2019, Florida will implement a new constitutional supermajority requirement to raise revenues, expanding an existing requirement that is more narrowly targeted to increases in corporate income tax rates. See Michael Leachman, Nicholas Johnson, and Dylan Grundman, “Six Reasons Why Supermajority Requirements to Raise Taxes Are a Bad Idea,” Center on Budget and Policy Priorities, February 14, 2012, https://www.cbpp.org/research/six-reasons-why-supermajority-requirements-to-raise-taxes-are-a-bad-idea.
[40] Mississippi Department of Archives and History, Proceedings of the Reunion of the Survivors of the Constitutional Convention of 1890, November 1, 1910.
[41] Today, 44 states and the District of Columbia impose some kind of limit on property taxes. For a full list of property tax limits still on the books today, by year of enactment, see Bethany P. Paquin, “Chronicle of the 161-Year History of State-Imposed Property Tax Limitations,” Working Paper WP15BP1, Lincoln Institute of Land Policy, April 2015, Appendix B, https://www.lincolninst.edu/sites/default/files/pubfiles/paquin-wp15bp1.pdf. See also Lav and Leachman, 2018.
[42] See Lav and Leachman, 2018.
[43] Ibid.
[44] Constitution of 1875, State of Alabama, Article XI, Sections 4, 5, and 7, http://www.legislature.state.al.us/aliswww/history/constitutions/1875/1875all.html.
[45] The 1901 constitution actually lowered further the cap on state property tax rates. See Malcolm Cook McMillan, Constitutional Development in Alabama, 1798-1901: A Study in Politics, the Negro, and Sectionalism, The Reprint Company, Spartanburg, South Carolina, 1978, p. 306. See also Constitution of the State of Alabama, 1901, available at http://digital.archives.alabama.gov/cdm/ref/collection/voices/id/3476.
[1] Knight v. Alabama, 458 F. Supp. 2d 1273 (N.D. Ala. 2004), https://law.justia.com/cases/federal/district-courts/FSupp2/458/1273/2568095/.
[47] Thornton, 1982.
[48] The harm done by the tax limits was evident not long after they were adopted in Alabama’s 1875 convention, as cities and counties were forced to take on a large amount of bonded debt to provide public investments without exceeding the tax limits. Delegates to the 1901 convention from urban areas sought relief from the limits, but more powerful white delegates from the Black Belt refused the relief. See McMillan, Constitutional Development in Alabama, pp. 328-330. Alabama’s state and local property tax revenue as a share of personal income in the state was 1.4 percent in 2016, the lowest in the country. (CBPP analysis of data from the Census Bureau and the Bureau of Economic Analysis.)
[49] See Paquin, 2015.
[50] Mississippi House Journal, 1932, p. 787, accessed through the University of Mississippi libraries.
[51] Jon C. Teaford, The Rise of the States: Evolution of American State Government, Johns Hopkins University Press, Baltimore, 2002, pp. 135-136.
[52] See A.H. Stone, “The Mississippi Sales Tax,” Proceedings of the Annual Conference on Taxation under the Auspices of the National Tax Association, Vol. 26, October 16-19, 1933, pp. 223-233.
[53] Teaford, 2002, pp. 136-138. An example of the influence of Mississippi’s experience on other states can be found in the proceedings of the 1933 conference of the National Tax Association. The presiding state tax official, from Indiana, notes that the head of his state’s tax department visited Mississippi to learn from its experience. Indiana subsequently became the second state with a modern retail sales tax. For a list of when states adopted retail sales taxes, see W. Bartley Hildreth and James A. Richardson, eds., Handbook on Taxation, Marcell Dekker, Inc., New York, 1999, p. 73.
[54] Institute on Taxation and Economic Policy, Who Pays? 6th edition, October 2018, https://itep.org/whopays/.
[55] Gilbert Thomas Stephenson, Race Distinctions in American Law, D. Appleton & Company: New York, 1910, pp. 196-198.
[56] Robert Margo, “Race Differences in Public School Expenditures: Disenfranchisement and School Finance in Louisiana, 1890-1910,” Social Science History, Vol. 6, No. 1, Winter 1982, pp. 9-33. See also Knight v. Alabama, 458 F. Supp. 2d 1273 (N.D. Ala. 2004), Nos. 30-31, https://law.justia.com/cases/federal/district-courts/FSupp2/458/1273/2568095/.
[57] Mark Kanazawa, “Immigration, Exclusion, and Taxation: Anti-Chinese Legislation in Gold Rush California,” Journal of Economic History, Vol. 65, No. 3, September 2005, pp. 779-805.
[58] Not all tax assessors were elected officials; some were appointed. These appointed officials were ultimately responsible to the elected officials who appointed them, and these elected officials owed their elections to a voting public that was overwhelmingly white.
[59] Andrew Kahrl, “Power to Destroy: Discriminatory Property Assessments and the Struggle for Tax Justice in Mississippi,” The Journal of Southern History, Vol. 82, No. 3, August 2016, p. 581.
[60] Ibid, p. 600.
[61] For a summary and broader context see Richard Rothstein, The Color of Law, Liveright Pubishing Corporation: New York, 2017, particularly pp.169-172.
[62] Arthur D. Little, Inc., “A Study of Property Taxes and Urban Blight,” a report to the U.S. Department of Housing and Urban Development, January 1973.
[63] Andrew Kahrl, “Capitalizing on the Urban Fiscal Crisis: Predatory Tax Buyers in 1970s Chicago,” Journal of Urban History, Vol. 44, Issue 3, May 2018, pp. 382-401.
[64] Michael Leachman, “Minnesota’s Tax Plan a Recipe for Future Growth,” Center on Budget and Policy Priorities, May 21, 2013, https://www.cbpp.org/blog/minnesotas-tax-plan-a-recipe-for-future-growth.
[65] Institute on Taxation and Economic Policy, 2018.
[66] Ibid.
[67] Ibid.
[68] The top bracket for single filers begins at: $551,473 in California; $500,000 in Connecticut and New Jersey; $1,077,550 in New York. The top bracket for single filers begins at $200,000 in Hawaii ($400,000 for joint filers); $250,000 in Maryland ($300,000 for joint filers); $160,020 in Minnesota ($300,000 for joint filers); $125,000 in Oregon ($250,000 for joint filers); and $416,700 in Vermont (same for joint filers). For all brackets and rates see https://www.taxadmin.org/assets/docs/Research/Rates/ind_inc_070118.pdf.
[69] Arthur B. Laffer and Stephen Moore, “Laffer and Moore: The Red-State Path to Prosperity,” Wall Street Journal, March 27, 2013, https://www.wsj.com/articles/SB10001424127887324532004578362053722832998.
[lxix] Dedrick Asante-Muhammad et al., “The Road to Zero Wealth: How the Racial Wealth Divide Is Hollowing Out America’s Middle Class,” Institute for Policy Studies and Prosperity Now, September 2017, https://ips-dc.org/wp-content/uploads/2017/09/The-Road-to-Zero-Wealth_FINAL.pdf.
[70] See Michael Mazerov, “The ‘Single Sales Factor’ Formula for State Corporate Taxes: A Boon to Economic Development or a Costly Giveaway?” Center on Budget and Policy Priorities, revised September 2005, https://www.cbpp.org/archiveSite/3-27-01sfp.pdf. See also Michael Mazerov, “Case for ‘Single Sales Factor’ Tax Cut Now Much Weaker, Center on Budget and Policy Priorities, April 1, 2015, https://www.cbpp.org/blog/case-for-single-sales-factor-tax-cut-now-much-weaker.
[71] Lisa J Dettling et al., “Recent Trends in Wealth-Holding by Race and Ethnicity: Evidence from the Survey of Consumer Finances,” Board of Governors of the Federal Reserve System, September 2017, https://www.federalreserve.gov/econres/notes/feds-notes/recent-trends-in-wealth-holding-by-race-and-ethnicity-evidence-from-the-survey-of-consumer-finances-20170927.htm.
[72] Maryland is among the 12 states with an estate tax and also operates a small inheritance tax, making it the sixth state with an inheritance tax.
[73] Center on Budget and Policy Priorities, “Many States Tax Inherited Wealth, 17 States Levy and Estate or Inheritance Tax,” updated July 30, 2018, https://www.cbpp.org/research/state-budget-and-tax/many-states-tax-inherited-wealth.
[74] Elizabeth McNichol, “State Estate Taxes: A Key Tool for Broad Prosperity,” Center on Budget and Policy Priorities, May 11, 2016, https://www.cbpp.org/research/state-budget-and-tax/state-estate-taxes-a-key-tool-for-broad-prosperity. For a more recently updated list of states with estate and inheritance taxes see CBPP, “Many States Tax Inherited Wealth.”
[75] Economic Policy Institute, State of Working America Data Library, “Poverty-Level Wages,” 2018, http://www.epi.org/data/#/?subject=povwage&g=*&r=*.
[76] Annie E. Casey Foundation, “2017 Kids Count Databook,” June 2017, http://www.aecf.org/m/resourcedoc/aecf-2017kidscountdatabook.pdf; Quillian et al., “2017.
[77] Marr et al., 2015; Greg J. Duncan, Pamela A. Morris, and Chris Rodrigues, “Does Money Really Matter? Estimating Impacts of Family Income on Young Children’s Achievement with Data from Random-Assignment Experiments,” Developmental Psychology, June 2011, pp. 1263–1279.
[78] Michelle Maxfield, “The Effects of the Earned Income Tax Credit on Child Achievement and Long-Term Educational Attainment,” Michigan State University Job Market Paper, November 14, 2013, https://www.msu.edu/~maxfiel7/20131114%20Maxfield%20EITC%20Child%20Education.pdf; Katherine Michelmore, “The Effect of Income on Educational Attainment: Evidence from State Earned Income Tax Credit Expansions,” November 2013, https://ssrn.com/abstract=2356444; Gordon Dahl and Lance Lochner, “The Impact of Family Income on Child Achievement: Evidence from the Earned Income Tax Credit,” American Economic Review, August 2012, pp. 1927-1956.
[79] United States Department of Justice Civil Rights Division, “Investigation of the Ferguson Police Department,” March 4, 2015, https://www.justice.gov/sites/default/files/opa/press-releases/attachments/2015/03/04/ferguson_police_department_report.pdf.
[80] Among many examples see the Brennan Center for Justice’s work in this area at https://www.brennancenter.org/criminal-justice-debt; work by the American Civil Liberties Union at https://www.aclu.org/issues/smart-justice/sentencing-reform/ending-modern-day-debtors-prisons; and work by the Vera Institute of Justice at https://www.vera.org/projects/past-due-examining-the-true-costs-of-the-user-pay-justice-system-in-new-orleans.
[81] Council of Economic Advisors Issue Brief, “Fees, Fines, and Bail: Payments in the Criminal Justice System that Disproportionately Impact the Poor,” December 2015, p. 3, https://obamawhitehouse.archives.gov/sites/default/files/page/files/1215_cea_fine_fee_bail_issue_brief.pdf. See also Karen Dolan and Jodi L. Carr, “The Poor Get Prison: The Alarming Spread of the Criminalization of Poverty,” Institute for Policy Studies, March 2015, p. 10, http://www.ips-dc.org/the-poor-get-prison-the-alarming-spread-of-the-criminalization-of-poverty/.
[82] German Lopez, “Study: cities rely more on fines for revenue if they have more black residents,” Vox, July 7, 2017, https://www.vox.com/identities/2017/7/7/15929196/police-fines-study-racism.
[83] Mathilde Laisne, Jon Wool, and Christian Henrichson, “Past Due: Examining the Costs and Consequences of Charging for Justice in New Orleans,” Vera Institute of Justice, January 2017, https://www.vera.org/publications/past-due-costs-consequences-charging-for-justice-new-orleans.
[84] Mitchell et al., 2018.
[85] Marr et al., 2015; Wolkomir, 2018; Sard et al., 2018.
[86] Elizabeth McNichol, “Strategies to Address the State Tax Volatility Problem,” Center on Budget and Policy Priorities, April 18, 2013, https://www.cbpp.org/research/strategies-to-address-the-state-tax-volatility-problem.
[87] Estimates of the annual cost to states and localities of these subsidies range from $45 billion to $90 billion. See Timothy Bartik, “A New Panel Database on Business Incentives for Economic Development Offered by State and Local Governments in the United States,” 2017, W.E. Upjohn Institute for Employment Research, prepared for the Pew Charitable Trusts, pp. 6, 47-48, https://research.upjohn.org/reports/225. See also Timothy Bartik, “Who Benefits From Economic Development Incentives? How Incentive Effects on Local Incomes and the Income Distribution Vary with Different Assumptions about Incentive Policy and the Local Economy,” W.E. Upjohn Institute for Employment Research, Report No. 18-034, March 2018, https://research.upjohn.org/up_technicalreports/34/.
[88] Michael Mazerov, “A Majority of States Have Now Adopted a Key Corporate Tax Reform — ‘Combined Reporting,’” Center on Budget and Policy Priorities, revised April 3, 2009, https://www.cbpp.org/research/a-majority-of-states-have-now-adopted-a-key-corporate-tax-reform-combined-reporting.
[89] Michael Mazerov, “Expanding Sales Taxation of Services: Options and Issues,” Center on Budget and Policy Priorities, August 10, 2009, https://www.cbpp.org/research/state-budget-and-tax/expanding-sales-taxation-of-services-options-and-issues.
[90] Michael Mazerov, “State and Local Governments Should Close Online Hotel Tax Loophole and Collect Taxes Owed,” Center on Budget and Policy Priorities, April 12, 2011, https://www.cbpp.org/cms/index.cfm?fa=view&id=3467.
[91] Chad Stone, “Putting a Price on Carbon Can Be a Budget Policy/Energy Policy ‘Two-Fer,’” Center on Budget and Policy Priorities, March 29, 2012, https://www.cbpp.org/blog/putting-a-price-on-carbon-can-be-a-budget-policyenergy-policy-two-fer.
[92] See Chad Stone, “The Design and Implementation of Policies to Protect Low-Income Households Under a Carbon Tax,” Center on Budget and Policy Priorities, September 21, 2015, https://www.cbpp.org/research/climate-change/the-design-and-implementation-of-policies-to-protect-low-income-households.
[93] See Headwaters Economics, “Oil and Natural Gas Fiscal Best Practices: Lessons for State and Local Governments,” November 2012, https://headwaterseconomics.org/wp-content/uploads/Energy_Fiscal_Best_Practices.pdf. See also Diana Polson and Stephen Herzenberg, “It’s Time for a Real Severance Tax in Pennsylvania,” Pennsylvania Budget and Policy Center, June 27, 2017, https://www.pennbpc.org/sites/default/files/Severance_Tax_Brief_Final.pdf.
[94] Center on Budget and Policy Priorities, “Federal Aid to State and Local Governments,” April 19, 2018, https://www.cbpp.org/research/state-budget-and-tax/federal-aid-to-state-and-local-governments.
[95] Michael Leachman and Michael Mazerov, “How Should States Respond to Recent Federal Tax Changes,” Center on Budget and Policy Priorities, January 23, 2018, https://www.cbpp.org/research/state-budget-and-tax/how-should-states-respond-to-recent-federal-tax-changes.
[96] Chuck Marr, Brendan Duke, and Chye-Ching Huang, “New Tax Law Is Fundamentally Flawed and Will Require Basic Restructuring,” Center on Budget and Policy Priorities, April 9, 2018, https://www.cbpp.org/research/federal-tax/new-tax-law-is-fundamentally-flawed-and-will-require-basic-restructuring.
[97] For example, see Center on Budget and Policy Priorities, “How States Should Respond to the Federal Tax Cuts for ‘Pass Through’ Business Income, March 27, 2018, https://www.cbpp.org/research/state-budget-and-tax/how-states-should-respond-to-the-federal-tax-cuts-for-pass-through.
[98] California’s recent experience reforming its education funding formula provides a useful example, particularly as the state is still working toward full implementation. See Jonathan Kaplan, “What Reaching LCFF Full Implementation Means and Why It Matters,” California Budget and Policy Center, April 9, 2018, https://calbudgetcenter.org/blog/what-reaching-lcff-full-implementation-means-and-why-it-matters/.
[99] See Michael Mitchell and Michael Leachman, “Changing Priorities: State Criminal Justice Reforms and Investments in Education,” Center on Budget and Policy Priorities, October 28, 2014, https://www.cbpp.org/research/changing-priorities-state-criminal-justice-reforms-and-investments-in-education.
[100] Center on Budget and Policy Priorities, “Policy Basics: State Supermajority Rules to Raise Revenue,” updated February 5, 2018, https://www.cbpp.org/research/state-budget-and-tax/policy-basics-state-supermajority-rules-to-raise-revenues.
[101] See Michael Leachman, Nicholas Johnson, and Dylan Grundman, “Six Reasons Why Supermajority Requirements to Raise Taxes Are a Bad Idea,” Center on Budget and Policy Priorities, February 14, 2012, https://www.cbpp.org/research/six-reasons-why-supermajority-requirements-to-raise-taxes-are-a-bad-idea.
[102] Voters approved the supermajority requirement on November 6, 2018. For the bill text see http://flsenate.gov/Session/Bill/2018/7001/BillText/Filed/PDF. See also “Not So Super: Florida’s Supermajority Proposal Endangers Economic Growth and Thriving Communities,” Florida Policy Institute, June 2018, https://www.fpi.institute/not-so-super-floridas-supermajority-proposal-endangers-economic-growth-and-thriving-communities/.
[103] Such an error is far from unheard of; states as diverse as Arizona and Maryland have enacted tax credits that turned out to be much easier to claim — and therefore had much greater impact on the state treasury — than was originally intended when the credit was enacted.
[104] For instance, Moody’s specifically cited supermajority requirements in Arizona and Nevada as reasons for downgrading those states’ bonds in the aftermath of the last recession. See Moody’s Investor Services, Global Credit Research Press Release, “Moody’s Downgrades State of Nevada’s General Obligation Bonds to Aa2 from Aa1,” March 24, 2011; and Moody’s Investor Services, Global Credit Research Press Release, “Moody’s Downgrades State of Arizona’s Issuer Rating to Aa3 from Aa2,” July 15, 2010.
[105] Center for Governmental Studies, “Reforming California’s Budget Process: Preliminary Report and Recommendations of the California Citizens Budget Commission,” 1995, pp.43-47.
[106] See Iris Lav and Michael Leachman, “State Limits on Property Taxes Hamstring Local Services and Should Be Relaxed or Repealed,” Center on Budget and Policy Priorities, July 18, 2018, https://www.cbpp.org/research/state-budget-and-tax/state-limits-on-property-taxes-hamstring-local-services-and-should-be.
[107] Institute on Taxation and Economic Policy, “Property Tax Circuit Breakers in 2018,” September 17, 2018, https://itep.org/property-tax-circuit-breakers-in-2018/.
[108] See Elizabeth McNichol, “When and How States Should Strengthen Their Rainy Day Funds,” Center on Budget and Policy Priorities, April 17, 2014, https://www.cbpp.org/research/state-budget-and-tax/when-and-how-states-should-strengthen-their-rainy-day-funds.