AMENDMENT #3
STATE GOVERNMENT REVENUE LIMITATION

RECAP: Replaces existing revenue limits with a new limitation based on inflation and population changes.

Ballot Summary

This proposed amendment to the State Constitution replaces the existing state revenue limitation based on Florida personal income growth with a new state revenue limitation based on inflation and population changes. Under the amendment, state revenues, as defined in the amendment, collected in excess of the revenue limitation must be deposited into the budget stabilization fund until the fund reaches its maximum balance, and thereafter shall be used for the support and maintenance of public schools by reducing the minimum financial effort required from school districts for participation in a state-funded education finance program, or, if the minimum financial effort is no longer required, returned to the taxpayers. The Legislature may increase the state revenue limitation through a bill approved by a super majority vote of each house of the Legislature. The Legislature may also submit a proposed increase in the state revenue limitation to the voters. The Legislature must implement this proposed amendment by general law. The amendment will take effect upon approval by the electors and will first apply to the 2014-2015 state fiscal year.

Explanation
The measure proposes replacing existing revenue limits with a new limitation based on inflation and population change. Any funds that exceed the revenue limits would be placed in the state's "rainy day fund." Once the fund reaches
10% of the prior year's total budget the Florida State Legislature would be required to vote to either provide tax relief or reduce property taxes. The Florida version is Constitutional Amendment 3 on the November ballot. This would replace the current cap on allowed state revenue increases with a new cap.
The current cap baseline of 1994 and allowed grow based on personal income. The new cap would have a baseline of 2013 and revenues would be limited to change in population and inflation as measured by CPI. Money raised over the limit would be deposited to fully fund the Budget Stabilization Fund, additional monies would then be used to reduce the Re-quired Local Effort for school districts and finally, if both are fully funded re-funds would be issued to taxpayers. Mechanisms have been built in to allow the Legislature to raise the limit or they can ask the voters to do so.

Background
The proposed legislation is modeled after Colorado’s Taxpayer Bill of Rights which limited state revenue using a formula based on population growth and inflation. The measure was approved in Colorado in 1992. In 2000 an amendment to Amendment 23 required education spending to increase and in 2005 voters approved a ballot measure that loosened many of TABOR's restrictions. However, in 2008 voters rejected Colorado Initiative 126, also known as Amendment 59, which would have extended the 2005 amendment past it's 2010 date. See also: Taxpayer Bill of Rights (TABOR)
Support
Senate President Mike Haridopolos is a long-time supporter of "Smart Cap." On February 24, 2011 he said, "Florida’s families are forced to spend their money responsibly and so should state government. Historically government has spent more when times are good and then been forced to make dramatic cuts when the economy takes a downturn. The ‘Smart Cap’ amendment ensures the state budget doesn’t grow beyond a family’s ability to pay for it."

Opposition
Opponents include groups like the AARP and the League of Women Voters.
Jack McRay of the AARP said the proposed revenue cap could prevent government services from keeping up with demand. .On March 2, 2011 the League of Women Voters officially announced their opposition to SJR 958. "The League has opposed this bill since it was first introduced in Florida in 2008. TABOR has been brought up and defeated in more than twenty states; the only state to pass TABOR is Colorado," said the league.
Florida Business Watch opposes TABOR because of trickle-down effects to local governments. We oppose setting a new baseline at a point of diminished revenues and oppose setting budgets based on an arbitrary formula.