Boston, MA 02108-2770
Thank you for giving me the opportunity to describe using the STAMP program to, successfully, analyze and oppose a proposed $267 million dollar tax increase which was submitted in the Kansas House of Representatives during the 2003 session.
Kansas, like almost every other state, was struggling with the potential of a large deficit in our state budget for the next fiscal year. Although our Democrat Governor and the leadership of the Republican controlled Senate and House adopted a policy of no tax increases there were elements on both sides of the aisle pushing for an income tax increase. The 2002 legislature raised sales and tobacco taxes in excess of 250 million dollars, but that did not solve the problem. I, along with other legislators in the Kansas House, felt an additional tax increase would do more harm than good. However, we were faced with the active elements of bureaucratic self-justification and positive projections of wonderful benefits to the citizens of Kansas if we would only increase educational and social service funding. We had a principled conviction of what was best for our state, but no tool to combat the numbers the State was generating through Legislative Research.
The STAMP program provided a tool by which legislators opposing tax increases could show that there is a negative side to raising taxes. While employees and c l ients of the state may benefit, at least temporarily, the private businesses in the state, and their employees, are harmed by a loss of jobs, production, and investment.
The program is not an "off the wall" theoretical projection, but is academically developed and based on actual local data which can be verified by anyone interested enough to take the time. Because of this we were able to use this information to good effect and the tax increase was defeated. There might be situations when the program was used, not to oppose a tax increase, but to select the type of tax which is most appropriate for the situation a state is facing. An egregious type of tax could then be replaced with a less damaging tax, or other type of revenue.
While it may not be perfect, I believe a program of this type offers postive leverage to legislators working to restrain increases in state spending and taxation. If it is to reach its potential it must be kept in private hands, continually updated, properly applied, and contain a long range analysis component
*Please note that is a fascimile of the original correspondence endorsing BHI's work. It has been formatted for the web. Original copies of correspondence are available upon request.