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AARP Florida Fights State Revenue Cap

Proposal could cut spending on vital state services and programs

A proposed state constitutional amendment that would limit the growth of state revenue is being called a "Smart Cap" by its supporters and a "wolf in sheep's clothing" by its opponents.

AARP Florida has joined forces with cities, counties and schools, as well as health, environmental and social service activists to defeat Amendment 3 on the Nov. 6 ballot. To take effect, it must be approved by 60 percent of the voters.

The amendment would establish a formula based on increases in inflation and population growth to set limits on the growth of state revenues. If revenue growth exceeded the cap, excess revenues would be deposited into the state's "rainy day" fund.

Jack McRay, AARP Florida advocacy manager, said the proposed revenue cap would result in serious cuts in spending on vital state programs. Restricting revenue growth would hamper the state's ability to restore funds for programs and services cut because of the recession.

"It's not about good government; it's not about rightsizing government; it's about strangling government," McRay said. "It makes no more sense to put your car on cruise control and try to steer through the rush hour traffic on I-4 in Orlando than it does to put the state budget on an automatic formula."

Legislature can cut taxes

Amendment 3 is unnecessary, McRay said, because the legislature already has the power to reduce taxes whenever it wants. A Florida Senate staff analysis reported that taxes on intangibles, sales, beverages, corporations and pari-mutuel earnings have all been reduced since 1999.

Amendment 3 was a priority of outgoing Senate President Mike Haridopolos, R-Merritt Island, who got the legislature to put it on the ballot. Haridopolos said Smart Cap will assure Floridians that their taxes are limited and are being spent wisely on essential programs.

"The Smart Cap amendment will create budget certainty for our state," Haridopolos said.

"Citizens will be assured that their state budget will not grow faster than their ability to pay for it," he said. "Moreover, any additional funds the state has will go into a rainy day fund. Finally, if legislators feel they would like to spend more, it will require a super-majority vote of both houses of the legislature."

Florida has had a revenue cap on the books since 1994, but it has never kicked in because revenue never exceeded the cap. A Senate staff analysis predicted the proposed amendment, over time, would be "more likely to constrain growth in state revenues" than the current law.

"Over time, the proposed state revenue limitation is more likely to constrain growth in state revenues than the current limitation," according to a Senate staff analysis of Haridopolis' proposal.

McRay disagrees with Amendment 3 supporters who say it would probably be 2019 or 2020 before the revenue cap would impose cuts in state spending. He said it is "likely to be much sooner and a lot more severe."

Limiting state revenues would require cuts in aid to local government, spending on schools and a wide variety of health and social services, McRay said.

Older Floridians should be especially wary of the impact that future revenue reductions would have on services such as Medicaid assistance to pay for nursing home care, Meals on Wheels and programs supporting Alzheimer's patients and their loved ones, he said.

Public interest advocate Brad Ashwell of Tallahassee is coordinating a campaign to defeat Amendment 3.

"It really doesn't lead to more responsible spending," Ashwell said. "It doesn't lead to better government. It just ties the hands of our legislature, and it leads to more cuts."

McRay said, "Amendment 3 is a wolf in sheep's clothing. AARP Florida urges all of our members to vote against this dangerous proposal."

John C. Van Gieson is a veteran news reporter and writer living in Tallahassee, Fla.

Remember to go to the AARP home page every day for tips on keeping healthy and sharp, and great deals.

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