Some Southwest tax measures fail to win over voters

A polling station in Austin, Texas, in November 2024.
A polling station in Austin, Texas in 2024. Voters in Texas and other Southwest states rejected various tax measures on Tuesday’s ballots.

Bloomberg News

Tax and spending measures on Tuesday’s ballots in Southwest states appeared to be a tough sell to voters, who rejected some of them.  

Processing Content

In Oklahoma, a legislatively referred constitutional amendment to reduce caps on annual growth in property value assessments for taxation purposes starting in 2027 was defeated with about 54% of the vote, according to unofficial results.

It would have slowed revenue growth for schools and local governments, possibly leading to millage rate hikes to make payments on voter-approved bonds, according to the nonpartisan Oklahoma Policy Institute, which opposed the measure.

The fate of Oklahoma County’s bond-financed replacement jail is uncertain after voters said no to a 25-year, 0.4% sales tax to raise about $70 million annually to cover debt service on additional bonds to complete the jail and operating costs.

The county already sold $260 million of general obligation bonds approved by voters in 2022 for what was then a $316 million jail to replace its 13-story detention center in downtown Oklahoma City. The project is now estimated to cost as much as $860 million.

County Commissioner Brian Maughan did not respond to a request for comment.

Colorado and Arizona measures

Results for Colorado’s two competing income tax measures were undetermined. Constitutional Amendment 87, which would replace the state’s flat 4.4% personal and corporate income tax rates with graduated rates ranging from 3.7% to 8.4%, had a slight lead . Proposition 136, which would statutorily cap income tax rates at 4.4%, was trailing with nearly 47.6% of the vote.

Gov. Jared Polis lauded the passage of Proposition NN, which he called an investment “in our schools to reduce class sizes, increase teacher pay, and expand childcare and preschool to save families money.”

Arizona’s Proposition 320, which would require an estimated 94 of the state’s 207 school districts to spend at least 60% of their operating budgets on direct instructional expenses or face a reduction in state funding, was trending toward defeat in .

If passed, non-complying districts would face a reduction in their per pupil allocations from the state’s Classroom Site Fund, which totals about $800 million annually. 

Tax hikes in Texas

Texas voters turned down dozens of maintenance and operations property tax rate increases sought mostly by school districts, according to a local media report.

Round Rock Independent School District, which had its underlying bond rating downgraded to Aa3 with a negative outlook from Aa1 by Moody’s Ratings in September, lost its bid for a $30 million revenue increase.

Plano voters rejected a tax package to help finance a $3 billion sports and entertainment district that would include a partly bond-financed arena for the NHL’s Dallas Stars.

“Without authorization for these venue taxes, the proposed financing approach would need to be reassessed before city council considers any actions related to the arena,” City Manager Mark Israelson said in a statement. “Our focus will be on providing them with a clear understanding of the financial implications and the options available moving forward.” 

In Corpus Christi, where a water supply crisis that led to bond rating downgrades and negative outlooks has eased, voters approved a citizen-initiated “Fair Water” city charter amendment to eliminate fee programs that exempt large industrial water users from drought surcharges or curtailments. 

The city has estimated the amendment would result in loss of about $6 million in annual revenue supporting debt the city issued through the Texas Water Development Board and a water rate hike would be required in 2029 to offset the loss, according to the official statement for the city’s utility system senior lien revenue bond sale last month.

Austin voters approved a $295 million general obligation bond package for parks and recreation facilities and public libraries, while rejecting Proposition I, a city charter amendment  to require regular “independent affordability and efficiency initiatives,” particularly ahead of any tax rate increase election.

Constitutional Amendment B in Utah failed. It would have required a 60% voter approval for ballot initiatives to create a new tax, expand an existing tax, or increase a tax rate.  

Economic development districts won’t be created in Arkansas with the narrow defeat of constitutional amendment Issue 3. 

The districts would have been used by cities and counties to spur housing, retail, and other projects and use incremental increases in property or sales taxes within the district to pay off bonds. 

Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *