Expanding Arizona’s Educational Savings Accounts to include educational costs for:

• children with special needs
• foster children
• children with parents in the military
• children in the poorest-performing schools

Failed 65:35

AZ Central | ‘Echoing at the state Capitol’: Arizona Prop. 305 to expand school vouchers defeated 

The ruling by the 5th circuit affirms the US Department of Education $33 million fine for Texas cutting special educaiton funding by $33 million in 2012.

Some say the fine should be paid through the Rainy Day Fund.

Some say Texas will not have to pay federal legal fees if it waives its right to appeal.

San Antonio Express news | 5th Circuit delivers expensive message to state 

97% of the total $8.73 illion in local bond propositions passed in Texas on November 6, 2018.

What was the largest bond proposal to fail? San Angelo School District’s $153 million proposal.

Bond Buyer | Texas voters approved almost all the bonds on local ballots

Texas Comptroller Bond RoundUp 2018  

A New York, Albany County  State Supreme Court judge (in other states liken it to a district court) said fantasy sports is like sports betting or poker.

But, its also not illegal in New York. 

What? Its legal to play fantasy sports, the regulatory structure is not valid. 

What’s the take away? legally complex

Bloomberg | State Judge Voids New York’s Online Fantasy Sports Law

WLNY | Judge Rules Daily Fantasy Sports Are Gambling And Illegal In New York

Albany Times Union | Split ruling on fantasy sports sites 

SJR 1 (2019 | TX) by Nelson

informed:intel on March 23, 2017:

Comptroller Glenn Hegar proposes investing to meet Texas long term obligations.

The Comptroller’s proposed idea:

• set aside some state Treasury balances to address long-term obligation by either:
  •  reserving a portion of the existing Economic Stabilization Fund
  • -or- 
  • capping the ESF and dedicating a portion above the cap to the permanent fund for long term obligations
• 7 states use long term investing on their severence taxes; including:
  • Alaska, Montana, New Mexico, North Dakota, Utah, West Virginia and Wyoming

Comptroller | Investing to Address Long-Term Obligations

and 

Lege TREND. Bill Adds Online Sales Tax. Grants Manufacturer Tax Breaks + Ends Online Sales Tax Agreements.

State: Utah

The legislation: In special session, the Utah Legislature passed HB 2003 (UT 2nd Special Session | 2018) and SB 2001 (UT 2nd special session | 2018)

What do the bills do?

• Ends agreements with collectors of online sales tax, like Airbnb and Amazon, that allowed the companies to retain up to 18% of their sales tax collections
• The online sales tax will only apply if the company does 200 sales or $100,000 in sales in UT
• Tax cuts for manufacturers to boost the state economy

US News & World Report | Utah Legislature Passes Requirement for Online Sales Tax

What tax can texas cities impose by ordinance to avoid property tax increases?

A utility sales tax:  Most Texas cities repealed their sales tax on utiltiies in the late 1970s: 141 Cities in Texas repealed their sales tax on utilities

How can this sales tax be implemented: Some say it can be revived by city ordinance

Where is it being considered? El Paso as an alternative to raising property tax revenues

KVIA | ​City of El Paso Considering a Sales tacx for utility services. 

California’s SB 946 (2018 | CA) will:

• legalize street vendors statewide
• create a permitting system
• preempt local criminal ordinances against street vendors
• allows residential areas to restrict stationary vendors 

The bill was messaged as:

• “EloteJustice”
• “elote with a side of justice”

What is the argument supporting the small business, street vendors?

The bill will override excessive local control over the streets and public spaces 

Streetsblog  Los Angeles | Bill Legalizing Sidewalk Vending Statewide Moves Through Legislature, Awaits Governor’s Signature

California passed AB 1884 (2018 |CA) preventing local bans on straws and providing for straws upon request.

Sacramento Bee | Plastic straws only for those who ask in California? It’s up to Jerry Brown

WHERE: Maryland

WHAT: Cybersecurity Investment Incentive Tax Credit  SB 228 (2018 | MD)

HOW does it work? To attract more capital the tax incentive would:

• 1/3 tax credit to invest at least $25,000 in a cybersecurity business with fewer than 50 employees

• If the business receiving the investment is located Allegany, Dorchester, Garrett, or Somerset counties a credit of 50%

• Permitts convertible debt as a form of investing.

• Applications must be submitted 1 month ahead of the investment

•  $250,000 cap for an investor within a fiscal year.

  Technically Baltimore | Maryland just opened up a tax credit for cybersecurity investors

The anatomy of fantasy sports betting proposition in Louisiana:

• Approval will be parrish by parrish
• After voter approval, the Louisiana Gaming Control Board would make rules for licensing, regulation and set tax rates
• Supporters:
  • Created the Fairness for Fantasy Sports to support the measure
• HB 484 (2018 | LA)

KSLA 12 | Elections 2018: Louisiana voters to consider fantasy sports gaming

Legal Sports Report | FanDuel Creates Advocacy Group To Push For Louisiana DFS Ballot Measure

Who is the study by? MIT researchers, who were approached by Fan Duel

What did the study say? Skill is rewarded in Daily Fantasy Sports

How did they get there?

• Examined 2013 and 2014 data from fantasy sports contests in baseball, basketball, hockey, and football 
• They examined every players performance and found it consistent through the season, if it were a game of chance the consistency would not be found
• They exmained how often people won if they played a lot or a little. They found statistically higher win fraction for people who play a lot versus a little, which indicates skill.
• they exmained player performance versus a random algorithim and found player performance beat the algorithim

MIT News | Study: There’s real skill in fantasy sports

Where & What? Lousiana legislature passed a bill to permit fantasy sports if parishes voted to approve it.

How much? Legalized fantasy sports passed in 2 parishes & failed in 4

• Yes in Calcasieu (56%) and Cameron (55%)
• No in Allen (54% NO), Beauregard (56% NO), Jeff Davis (51% NO) and Vernon (58% NO)

KPLC | Two SWLA parishes vote to allow fantasy sports betting, four vote the measure down

Arizona voters approved a constitutional ban on service taxes this week.

Other states with constitutional bans on taxing services, including Netflix? Missouri

Who is behind these bans? real estate groups

Governing | Not My Netflix or Yoga: A Second State Bans Service Taxes

This link takes you to Comptroller Hegar’s draft online sales tax legislation.

New Hampshire voters will vote to fight their governments—-in court. Adieu soveriegn immunity. it’s been real.

Who supports it? New Hampshire’s State Republican and Democratic Parties

Governing | One State’s Voters Fight for Their Right to Sue the Government 

IN 2017, the Texas Legislature provided for direct petition to the Supreme Court when property is taxed by two county taxing jurisdictions.

What property was at issue? Oxy’s facility in San Patricio & Nueces Counties

What county prevailed? San Patricio which according to Justice Hecht’s opinion, the piers installed in San Patricio County waters are derivied from the ownership of the upland property

Will this be something for the 2019 Texas Legislature? Yes, potentially the Texas Supreme Court is also set to rule on a similar case for the merits, a case pre-dating the 2017 law.

Legal News Line | Texas Supreme Court backs San Patricio County on property tax location dispute

• eliminate the port of entry tax on alcohol
  • ​why? it costs more to implement than it collects
  • savings: $7.6 million in agency costs
• align taxes on beer & malt beverages
  • why? no reason to have 2 tax structures
  • Texas system should be modernized for regulatory clarity & administrative efficiency

Sunset Adviosry Commission | Texas Alcoholic Beverage Commission

LeRoy, Texas, in McLellan County, will vote whether the town of 345 people should unincorporate.

How did we get to this? 

• 80 residents signed a petition calling for the election
• the 80 residents were motivated by the imposition of a new property tax
• residents don’t want to pay for road work on roads they do not use
  • the proeprty tax revenue was to repair damaged roadways

KWTX | Small Central Texas town could vote itself out of existence

South Carolina expanded its economic development programs to apply to more projects by:

• reduced from 175 to 125 job requirements at a single location 
• reduced to 100 jobs (from 150) at a single location comprised of a building or portion of a building that has been vacant for at least 12 consecutive months before the taxpayer’s investment 
• reduced to 75 jobs (from 100) at a single location and the jobs that have an average cash compensation level of more than 1.5 times the lower of state per capita income or per capita income in the county where the jobs are located 
• expanded the list of qualifying industries
• applied it to entities with 50 jobs at a single location and the jobs that have an average cash compensation level of more than 2 times the lower of state per capita income or per capita income in the county where the jobs are located
• applied it to entities with 25 jobs at a single location and the jobs that have an average cash compensation level of more than 2.5 times the lower of state per capita income or per capita income in the county where the jobs are located

Market Insider | South Carolina Expands Economic Development Incentives  

Oregon constititionally requires a supermajority for tax increases.

The Oregon Supreme Court said this supermajority does not apply to tax credits, deductions, exemptions etc…

November 2018 Oregorn voters will vote whether to require a supermajority for increasing “state revenue through changes in tax exemptions, credits, deductions or fees”

What group is pushing the measure? Business interests 

Governing | Oregon Voters Could Make It Harder to Raise Revenue

A ballot proposition in Oregon to prohibit new sales taxes on groceries, will effectively prohibit a local soda tax passed by Multnomah County.

Washington State voters will also vote on a ban on new grocery taxes but it will not apply retroactively like the Oregon proposal.

Governing | Groceries, Tampons, Tobacco: Voters Get to Decide What’s Taxed

WHO: Los Angeles voters

WHAT: A Novmeber 2018 ballot proposition to establish a public bank to finance:

• finance housing
• infrastructure
• community development

HOW? Public banks were common, now only the Bank of North Dakota exists.

3 Points from Bank Opposition:

• taxpayer dollars capitalize the bank & that risks tax dollars
• no clarity as to defaults
• startup costs could run into the billions

Governing | The Issues on Local Ballots: Teen Voting, Campaign Finance, Housing and More

WHERE: Indiana

WHAT: Collegiate athletes sued Daily Fantasy Sports in Indiana over using the athletes’ likenesses

WHY? The Indiana Supreme Court found that Daily Fantasy Sports Did NOT support the althetes claim to their sports data and likeness saying:

• “”material that has newsworthy value.”
• the data DFS uses is verys imilar to what appears in news and on websites
• the information is publicly available

Indianapolis Star | Indiana Supreme Court backs online fantasy sports companies in nationally watched case 

• Since 2009 35 states increased employee contribution rates
• Colorado in 2018: raised the retirement age for new hires after 2020 to 64 yr
• Kentucky in 2013: Suspended all COLAs until the fund is 100% funded
• Oregon in 2018: earmarked  alcohol and marijuana and lottery revenues for pensions
• New Jersey in 2017: dedicated all earnings from the state lottery to the public pension fund
• Oklahoma in 2014: tried to move to 401Ks, the compromise that emerged was that new state employees would be moved to a 401(k) plan after November 2015
• 2005 Alaksa switched to 401K styke plans: Public Safety Officers are finding work in other states

Front Line | How States Have Tried To Close Their Pension Funding Gaps 

Louisiana voters in Novmeber 2018 will decide whether to permit Daily Fantasy Sports on a parish by parish basis.

Supporters say:

• this is not gambling. this is entertainment . this is personal choice.
• people are going to do it anyway & the state should get its cut of the proceeds (tax)
• Fairness for Fantasy Sports, the group supporting the proposition, has populist messaging that the state cannot tell us what to do with our money

Opponents say:

• this is gambling
• DraftKings and FanDuel settled with the NY Attorney General over claims that “they employed false and deceptive advertising practices that included misleading players about the likelihood that they would earn a positive return”
• Louisiana Family Forum opposes it
• children must be protected

NOLA | Fantasy sports betting is gambling, which means there are more losers than winners

Sales between January through August hit over $1,000,000,000. The easrliest the state has hit $1 billion in sales.

Tht’s $200 M in tax revenue.

Where is the sales growth?

• edible products
• concentrates like hash oil
• live resin 

What’s the rate of growth on sales?

• 2018 year to date sales up 2.6%
• 2017 sales were up 18.7%
• 2016 sales were up 31.5%

Sales growth is slowing.

Denver Post | Colorado cracks a billion in annual marijuana sales in record time, generating $200M in tax revenue

Looking at Pennsylvania, since the NFL season started Daily Fantasy Sports Revenue has:

• increased 126%
• what does the mean to Pennsylvania coffers?
  • $2,133,714 DFS  in September = $320,057 in state tax revenue 
  • $943,620 in August
• how does PA derive its revenue? the state gets 15% of adjusted revenue

Leigh Valley Live | How much money fantasy sports generated for Pa. once the NFL season started

The anatomy of fantasy sports betting proposition in Louisiana:

• Approval will be parrish by parrish
• After voter approval, the Louisiana Gaming Control Board would make rules for licensing, regulation and set tax rates
• Supporters:
  • Created the Fairness for Fantasy Sports to support the measure
• HB 484 (2018 | LA)

KSLA 12 | Elections 2018: Louisiana voters to consider fantasy sports gaming

Legal Sports Report | FanDuel Creates Advocacy Group To Push For Louisiana DFS Ballot Measure

States taxing services like fitness memberships: WA, TX, UT, AZ, NM, CO, OK, KS, NE, ND, SD, MN, IA, MO, LA, MS,FL, TN, OH, WV, NJ, CT, VT

Netlfix taxes: Chicago, PA, & FL

AZ: A constitutional proposition in Nov. to prohibit taxing services, making it the 2nd state to do so

Governing | A Second State Could Ban Service Taxes

Association of Fitness Studios | Understanding Sales Tax for Fitness Studios

Where:  Utah

The legislative compromise: The Utah Legislature and Supports of Increasing School Funding made a deal that would:

• put a 10cent gas tax question to the voters and then require legislative implementation after the vote
•  the Legislature in exchange:
  • froze the state basic property tax rate for 5 years
  • created a new tax rate for the weighted pupil unit thereby creating a $292 million increase in education funding.
  • if the gas tax is approved, funds would be divded like this:
    • 70% to schools
    • 30% to transportation projects

Park City Record | Ballot question will ask Utah voters if they support gas tax increase for public education funding

WHERE: California

WHAT: November 2018 election in California will include a proposition to split the property tax rolls

HOW would the property tax rolls be split?

• The 1978 cap, Prop 13 would continue to apply to residential property
• The proposition removes the cap for commercial and industrial property
• Exemptions from the split roll would apply to 3 types of property:
  • Small businesses
  • agricultural land
  • up to a half million dollars worth of tangible property

Question answered by the TX Attorney General opinion:  Whether the Teacher Retirement System may invest in indexed universal life insurance policies funded by leveraged premiums.

Answer: Maybe, but it depends on the individual indexed universal life policies

What 2 questions can be asked in the future to find out if TRS can invest in a certain product?

• Is the investment  a security?
  • article XVI, section 67 of the constitution,
    • a security “includes any investment instrument within the meaning ofthe term as defined by” a specified section in one of three statutory sources:
    • (1) the Texas Securities Act;
    • (2) the federal Securities Act of 1933; or
    • (3) the federal Securities Exchange Act of 1934.
  • TEX.Gov’t Code § 825.301(a).5
• Does the investment meet the standards for prudence and overall strategy in the Texas Constitution & statutes.
  • 117.004(b) of the Property Code
  • TEX. Gov’t Code § 825.30l(a)

What would change the answer?  defining an indexed universal life insurance policies funded by leveraged premiums as a security

Texas Attorney General Opinion KP-0220 (2018)

Trib Talk has two parallel pieces on cash bail:

Dallas County’s money-bail problem by an attorney & a faith leader says:

• We agree with the federal judge that halted Dallas Co. cash bail system
• Cash bail is a “destructive and inequitable relic” that should end forever and ever
• ” unconstitutionally and inhumanely punishes the poor”
• paid by people who are not convicted of a crime
• paid by people who are not charged with a crime
• a bail hearing lasts 15 seconds with no attorney present
• these people lose their jobs, homes, and children

Sound familiar? It should. Similar arguments made by right leaning organizations against civil asset forefeiture.

Money bail is essential to criminal justice by United Bail of America says:

• The federal judge in Dallas halted it only because it was halted in Harris Co.
• We have to look at ewhat has happened since this was halted:
  • “Failure-to-appear rates have significantly increased in Harris County”
  • Up to 40% from 8% before
  • 114 who failed to appear had previous criminal records
• New Jersey tried this and they have to round up sexual predators & people who make terroristic threats who are released 

WHERE: Arizona

WHO (Supporters): Arizona Realtors via Citizens for Fair Tax Policy

WHO (Opposition Coalition): 

WHAT: Arizona Proposition 126

• Supporters, Citizens for Fair Tax Policy, say:
  • the goal is to “head off any push to add sales or transaction taxes to services such as veterinarian and health care expenses, and real estate commissions”
  •  bar the state, counties and cities from imposing a new or increased tax on services not already in effect on December 31, 2017
• Opponents say a report from  Grand Canyon Institute says:
  • $250 million hit to the state’s schools starting in 2021
  • 33 to 44 percent cuts in regional transportation
  • Prop 126 is basically “loopholes for lobbyists”

KTAR| via AP | Arizona group says Prop. 126 will hurt education, transporting funding

Texas Public Policy Foundation arguements against local governmental entities hiring lobbyists are:

• its not the lobbyists we have a problem with, its that government should not lobby government
  • “does government itself have the right to lobby?”
• local control can harm state economic interests.
  • “what if local control is injurious to freedom? What if local control hurts the larger state economy?”
• the constitution. government has no rights to lobby. Rights are with the people.

As a bonus: local govenrment lobbying is effective and a good return on investment.

“Spending a few tens of millions to influence how some of that $116 billion was spent appears to be a good return on investment.”

TPPF recommends trying again with the 1997 HB 2501 by Elkins to prohibit local government lobbying.

Texas Public Policy Foundation | Government Spends Millions To Lobby Government–Time To End The Practice

Who: State Representative Gary Elkins

His legislative proposal as his 1st bill of 2019:  

• partial use of the state’s rainy day reserve fund
• use the Rainy Day Funds to help:
  • with Hurricane Harvey recovery
  • down payment for draining down federal funds to get infrastructure moving to prevent future flooding

Community Impact | ELECTION Q&A: Candidates for State Rep. District 135 say what their first bills would be if elected and more

The workers in Kentucky: In 2016, 202 hourly wage positions at Western Kentucky University were moved from university employees with a pension to  Sodexo employees.

These workers previously paid into : Kentucky Employee Retirement System

So, what? The Pension system unfunded liability is further strained with these employees nopt paying into a system but still able to receive benefits.

What key words do I need to know?

• ‘pension orphans,’ employees whose liabilities are left in the system without any cash flow to contribute to them

Lexington Herald Leader | As state agencies privatize jobs, ‘orphaned’ pension debts threaten Kentucky taxpayers

Where: Arizona

What: Proposition 125 on the November 2018 ballot

The Savings: “save taxpayers an additional $275 million over the next several decades.”

the Pitch:

• Replace annual increases with:
• a reasonable, sustainable Cost of Living Allowance tied to the CPI in Phoenix and Mesa

AZ Central | Voters saved public safety pensions. Prop. 125 would do the same for corrections officers

• innate structural disincetive to consider long term pension viability
  • “Political appointees are responsive to constituencies”
  • Elected board members are “tempted to trade pension savings tomorrow for higher salaries today”
• “more worker representation on boards and stronger public unions led to more fiscally irresponsible decisions”
• “Political appointees also tend to favor investing in local industries — whether or not they are actually profitable”
• These incentives “don’t protect employees and taxpayers from major financial risks”

The proposed solutions for Pension Boards:

• require greater financial expertise
• more clearly define fiduciary duties
• “defined-benefit plans a thing of the past would wisely eliminate the need for pension fund boards altogether”

Governing | A senior fellow at the Manhattan Institute and associate professor at the City College of New York-CUNY| How Public Pension Boards Are Making a Crisis Worse

Where: Wyoming

New Wildlife fees: fees on hikers, bird watcher and nature photographers

So how do you get those who don’t fish or hunt to pay?

• create a new recreation stamp
• attach a new fee to the existing conservation stamp
• responsioble agencies would be: Game and Fish & the Office of State Lands and Investment

What do the numbers look like?

• $10 fee for annual access
• revenue dedicated to education

Is this new?

• MT has a $2 conservation stamp with revenue dedicated to its school trust
• the fee does not apply to non-residents thatpurchase short 1-5 day temporary licenses

Casper Star Ttribune | Wyoming Legislature considers fees for hikers, photographers and birdwatchers

• In 2007 TRS Board voted to invest 10% of its assets in emerging markets during a period of economic prosperity
  • One of the investments was a Turkish steel company now “in the crosshairs of President Donald Trump.”
  • The vote opened up investments in these countries:
    • Brazil
    • Russia
    • India
    • China
    • Mexico
    • South Africa
    • Turkey
• Created a structural investment probelm in TRS in that professional investors “can rush in and out of emerging-market stocks when market sentiment shifts”, TRS cannot so easily

The investments have returned 1.1%

Other state pensions did this like NY and CA, what made TRS different? TRS devoted 10% of its assets, in contract CA capped it at 4%

The Street | In Texas, Teachers See Savings Eroded by Bad Bets on Exotic Stocks

California and Lousiana both have property tax reform on the November 2018 ballot. 

California ballot proposition 5 tackles proeprty taxes by:

• allow home buyers who are seniors, disabled or homeless due to natural disaster to pay taxes on only a portion of their new home’s market value
• expands prop. 13, the state’s existing constitutional limit on property taxes
• cities and schools say it will create a first year loss of $150 million in total revenue for schools and local governments across, and th eloss will be cumulative
• Supporters say it frees up inventory to encourag eyounger home buyers and softens the the Prop. 13 moving penalty

Lousiana ballot proposition, Amendment 6, will:

• phase in homeowners’ new property taxes over 4 years
• relief to homeowners who haven’t made any significant improvements & have an evaluation more than 50% higher

California Budget Office analysis on Prop 5 (2018)

Governing | The Week in Public Finance: Amid Rising Home Prices, 2 States Take Property Tax Proposals to Voters

After Puerto Rico’s 2018 hurricanes, utility companies helped rebuild Puerto Rico’s grid. 

Local governments then sought to impose these two taxes on the utility companies:

• license tax
• construction tax

What is the impact of these taxes?

• Florida Power & Light:  $2 million + r $333,000 more in taxes, fees, penalties and interest
• Ameren and the Sacramento Municipal Utility District received bills for nearly $3 million

has this happened on the US main land? Yes, after Hurricane Sandy in NY, but the taxes were waived

How were the taxes covered in emergency services contracts? Written into the contracts that FEMA would cover the taxes imposed

Seattle Times | Utilities that helped Puerto Rico fix power grid now face hefty tax bills

This Novmeber California ballot proposition is asking voters to vote to repeal a gas tax increase.

Polling shows 52% oppose repealing the gas tax increase.

Polling also shows that Republicans do not favor the repeal initiative.

Sacramento Bee | Are you sticking with the gas tax increase? Poll says most California voters now plan to

Recommendations in report:

• pension plan reporting should keep track with the pace of risk
• disclose their net return after fees and include costs like performance fees
• implement stress-test reporting

Pew Report | Governing | Pensions Are Shelling Out Billions in Fees — and It’s Not Paying Off

The new budget coalition in Texas: Conservative Texas Budget

6 point plan:

• Conservative Budget $234.1 billion in All Funds $156.5 in State Funds Based on an increase in population growth and inflation for 2017-18
• Spending Limits for State & Cities  based on last 2 fiscal years and capped at no more than population growth and inflation
• property tax relief automatic local rollback trigger rate at 2.5% and use state dollars to eliminate school maintenance and operations property taxes
• No margins tax
• Tax relief Fund  to return tax dollars
• zero-based budgeting and promote efficiency audits to eliminate government waste

Coalition members:

*Americans forProsperity–Texas            
*Americans for Tax Reform
*Citizens Against Government Waste        
*Grassroots America—We the People
*Heartland Institute                                 
*Heritage Alliance                       
*Institute for Policy Innovation                  
*Lone Star Policy Institute 
*National Taxpayers Union                      
*Our America Initiative
*R Street Institute                                     
*Reason Foundation 
*State Budget Solutions                                     
*Texans for Fiscal Responsibility 
*Texans 4 Truth                             
*Texas Eagle Forum           
*Texas Public Policy Foundation               
*Young Conservatives of Texas 

What question is the Texas Attorney General answering? 

Where: Oregron

Why heavier refillable beer bottles?  Oregon launched the first statewide refillable bottle system

Future Procurement opportunities:  statewide infrastructure for collecting bottles

Business opporunities in a refillable bottle system:

• producing larger refillable bottles
• recycling glass for the larger refillable bottles
• collecting bottles

 NPR | Oregon Launches First Statewide Refillable Bottle System In U.S.

A free market think tank in Ohio is supporting Educational Savings Accounts (ESAs) because ESAs will:

• help low income and minority students
• will close the achievement gap
• more parental control

News 6 KPVI | Ohio group says education alternatives needed to close achievement gaps

The Houston Chronicle Editorial, Texas keeps slurping up local property taxes [Editorial], offers these points about property taxes:

• the state is “sucking up” local property taxes
• why? TEA says the sate will spend $3.5illion less in General Revenue and recoup the funds with local proeprty taxes
• more state dollars should be spent locally for school funding
• The Governor isn’t focused on it, he wants to constitutionally prohibit an income tax
• The Lt. Gov. isn’t focused on it, he is actively talking about the bathroom bill

State: Nebraska

The revenue being eyed for a property tax reduction:

• Cutting all sales tax exemptions
• State tax incentives for business development and expansion in the Nebraska Advantage Act

Beatrice Daily Sun | Sales tax exemptions eyed to fund Nebraska property tax relief. 

Minnesota Legislature & 10 other states are considering an opioid distribution tax. 

The states:

• Minnesota
• California
• Delaware
• Iowa
• Kentucky
• Maine
• Massachusetts
• Montana
• New Jersey
• Tennessee
• Vermont

NY’s opioid tax became effective July 1st.

Kaiser Health News via Governing | Opioid Tax Proponents Pin Hopes on November Elections

West Central Tribune | State Legislature Should Oppose Opioid Tax

Texas Public Policy Foundations offer the following recommendations for local pension systems:

• Restore local control of local retirement systems to allow for greater local oversight

These numbers were repeated in TPPFs supporting information: 

TPPF Legislator’s Guide to the Issues 2019

Texas Public Policy Foundation recommends:

• Freeze enrollment in the current defined benefit system
• 401K system for new hires and non-vested state employees
• Lower assumed rates of return to “realistic” rate of return
• No additinal state funding for pensions without reform

TPPF Legislator’s Guide 2019

WHERE: Maryland

WHAT: Cybersecurity Investment Incentive Tax Credit  SB 228 (2018 | MD)

HOW does it work? To attract more capital the tax incentive would:

• 1/3 tax credit to invest at least $25,000 in a cybersecurity business with fewer than 50 employees

• If the business receiving the investment is located Allegany, Dorchester, Garrett, or Somerset counties a credit of 50%

• Permitts convertible debt as a form of investing.

• Applications must be submitted 1 month ahead of the investment

•  $250,000 cap for an investor within a fiscal year.

  Technically Baltimore | Maryland just opened up a tax credit for cybersecurity investors

In 2018, Wyoming passed legislation to:

• freely trade cryptocurrency
• exempt from property tax virtual currency
• corporations can use blockchain technology to store company records
• “initial coin offerings” are legal

Rapid growth in cryptocurrency and blockchain in Wyoming also brings a rise in :

• fraud
•  hacks
• illegal activity

The solution: include enforcement mechanisms and consumer safeguards in legislation.

Wyoming Tribune Eagle | Risks of unregulated blockchain laws in Wyoming may be overlooked

WHERE: Oklahoma

WHAT: New Oklahoma Rural Association

WHO are members of the ORA?

• energy
• agribusiness
• manufacturing
• financial services
• equipment
• utilities sectors
• including associations like: Farm Bureau, American Farmers and Ranchers, the Cattlemen’s Association
• corporations
• &  landowners.

Additional Issues they will engage the Legislature on:

•  education
• health care

The Oklahoman | New Oklahoma Lobbying Group to represent rural communities

Refreshing our recollection. After the US Supreme Court decision in Wayfair, the Texas Comptoller provided initial guidance that:

• Rules will not include any retroactive application of the new law to remote sellers that have no physical presence in Texas
•  target effective date for rule amendments: Early 2019
• Seeking input from: 
  • interested parties
  • retailers
  • remote sellers
  • trade associations
  • the Comptroller’s Taxpayer and Business Advisory Group
• consult with local taxing entities on impact to local revenues

Texas Governor Greg Abbott proposes a constitutional amendment prohibiting a state income tax by:

• wholly banning a state income tax
  • currently voters may approval a state income tax
• require a 2/3 vote by both the House and Senate
• and require approval of a majority of voters

Ft. Worth Star Telegram | Gov. Greg Abbott wants to change the Texas Constitution to ban the possibility of income tax

See this example: HJR58 by Schofield (2017 | TX) 

The Tax Foundation says that states like TX, PA, CA, FL, IL, VA and NY need to take the following legislative actions to impose an online sales tax:

• Complete the requirements established in Wayfair
• Adopt uniform definitions
• Simplify sales tax systems
• Allow sellers to register with SSUTA rather than requiring state-by-state registrations
• Limit multistate audits
• Alow SSUTA service providers to work with their state
• Provide taxability, exemption, rate, and boundary data for download on their websites

Tax Foundation | Post Wayfair Options for States 

The problems identified by the Texas State Auditor related to these 2 contracts:

Tembo contract.

• Inappropriately requalified after disqualification
• Advanced proposal to the final round with a lower score than other proposals
• Awarded contract without an explanation when another vendor with the same final score

Texas SAO | Selected Contracts at the Texas Education Agency | Report No. 18-044

California Legislature passed AB 987 (2018 | CA) that streamlines building a new stadium for the Clippers & construction by the Oakland A’s by:

• In exchange for tort reform measures to make stadium building quicker,
• sets standards to limit the number of vehicle trips to the stadium by establishing transportation alternatives
• requires litigation to be resolved within 270 days of the filing of the certified record of proceedings

NBC Sports | Pro Basketball Talk | State legislature helps Clippers take next step toward new home arena 

San Francisco Chronicle | Legislature passes bill to help Oakland A’s streamline construction of a Howard Terminal stadium

City looking to impose a utility tax: Memphis

What utilities would the tax apply to? Memphis Light, Gas and Water bills and would operate like a stormwater tax

What would the tax be? range from $4.75 to $15

What is the projected local revenue?  $30 million in revenue each year

Transportation projects to be funded? offset the costs of road projects and create a dedicated source of funding for Memphis Area Transit Authority

Memphis Flyer | City Council Looks to Implement Transportation Utility Fee

• The alternative, a constitutionally required super majority for tax increases, was a worse vote
• Initiative and Referrendum was utilized by industry as a way to get Legislative Action
• Instead of making the issue about a soda tax, it was messaged as an increase in all taxes and fees

Governing | Why California Lawmakers, Begrudgingly, Banned Soda Taxes

California passed AB 1884 (2018 |CA) preventing local bans on straws and providing for straws upon request.

Sacramento Bee | Plastic straws only for those who ask in California? It’s up to Jerry Brown

What is this all about? Austin’s proposed efficiency study ordinance

Why is the efficiency study an issue? “the current ballot language misleads voters into conceiving of the efficiency study as a net cost to Austin”

What does TPPF want? 3rd party audits of city budget and practices

TPPF Press Release on its brief

 City: Berkeley

Why is Berekely interested in local bonds backed in bitcoin?

• “cryptobonds” can be issued in denominations as low as $5 or $10
• Its a way to Fund Seciton 8 housing, slashed by the federal government

Governing | Berkeley’s High Tech Gamble

University of Michigan professor Judith Grant Long work shows:

• $67 M in lost property tax revenue on a $350 million stadium over 30 years
• $53 million in lost revenue over 30 years for the city’s share of revenue from ticket surcharges, concessions and parking surcharges (often split with a team)
• + Costs generated from naming rights
• + costs generated from advertising revenue

Governing | Even When Teams Pay, Stadiums Still Aren’t Free for Cities (Looks at Austin, TX new MLS stadium and team)

Who is asking for an opinion? Hood County Attorney

What question does the Hood County Attorney want answered?  Authority o f a county to refund penalties and interest paid by taxpayers to a private tax collection firm, upon proof that the county may have caused the confusion that led to the delinquencies.

What is happening in Hood County? 

• Hood County contracted with Linebarger for collection
• Hood County received complaints
• Hood County moved all collections back to the County
• Hood County residents are “notice of delinquency from Linebarger”

Local Linebarger Attrorney pointed the County Attorney to 2 Tax Code provisions that require the fees:

• Section 3I.0l(g) “does not allow failure to receive a bill toform an excuse for nonpayment”
• 33.011 (d) “taxpayers may not seek awaiver o f penalties and interest once 181 days have elapsed since the tax became delinquent”

Those 2 code provisions are ripe for a HB or SB as Hood County thinks this is not fair to their taxpayers.

RQ-0244 -KP

California’s SB 946 (2018 | CA) will:

• legalize street vendors statewide
• create a permitting system
• preempt local criminal ordinances against street vendors
• allows residential areas to restrict stationary vendors 

The bill was messaged as:

• “EloteJustice”
• “elote with a side of justice”

What is the argument supporting the small business, street vendors?

The bill will override excessive local control over the streets and public spaces 

Streetsblog  Los Angeles | Bill Legalizing Sidewalk Vending Statewide Moves Through Legislature, Awaits Governor’s Signature

The Association: Sharing Economy Association Taiwan

membership: 

• Avis Budget Group and Zipcar
• AppWorks
• AsiaYo
• Jackercleaning
• GoGoVan
• Lalamove
• Uber
• Uber EATS
• USPACE
• WeMo
• Zipcar
• Zhong Yin Law Firm
• LCS & Partners Law Firm
•  the Institute for Information Industry

Goal of the association: promoting a regulatory environment conducive to Taiwan’s innovative digital economy

Taiwan Business | Sharing Economy Association Launches in Taiwan

Requesting the opinion: Chairman CHARLES SCHWERTNER

The questions he wants EXPEDITED: 

• whether a home-rule municipality in Texas can legally adopt a residential homestead property tax exemption that provides for a minimum exemption amount greater than $5,000; and (2) whether an appraisal district or thief appraiser is legally authorized to disregard or modify a local residential homestead property tax exemption adopted by a local taxing unit.

Why? Cedar Park residents, in two different counties, will have a homestead exemption ordinance that is set to be implemented with two different minimum amounts, $5,000 and $10,000.

State:  Michigan

Poll: ” 63% of likely voters support Michigan continuing to offer tax benefits to families who use a child’s 529 plan to pay for private school tuition”

Poll from: Mackinac Center

How do 529 plans pay for state tax breaks? Vew federal tax reform law allows 529 savings to be used for K-12 expenses. State law changes are necessary for state tax benefits

Mackinac Center | Poll: Mich. Voters Back Tax Benefits for School Choice

Regualtion of Daily Fantasy Sports will alter this year when Crown League launches.

Crown League will use blockchain to keep fantasy sports “honest”

CNN | The world’s first professional fantasy football league uses blockchain technology

Who takes the position that underfunding is the reason for rising pension costs? Alicia H. Munnell is the director of the Center for Retirement Research at Boston College

Why is underfunding of pensions causing the rising pension costs? (charts & graphs at link)

• Since 2001, the normal cost of benefits has remained unchanged
• Since 2001, benefits have declined
• Since 2001, employer contributions have declined

Do these numbers respond to something?  Yes, Wall Street Journal Editorial on July 19, 2018

Market Watch | Opinion: Don’t confuse public pension cost with generosity 

What question needs an answer by the Attorney General?   Do contractual assessments imposed by local governments under the Property Assessed Clean Energy Act (“Act”) in chapter 399 of the Local Government Code are “special assessments by the local government and treated in a similar manner as the real estate taxes on the property.”

What is all that mumbojumbo?  We’re talking about fees that come from the creation of local water and energy improvement programs in designated regions

What are local water and energy improvement programs? they exist to finance permanent improvements on privately owned commercial or industrial real property with 5+ dwelling units to decrease water or energy consumption or demand

So waht do we need to know to figure out how these assessments are treated under Texas Tax Code?

• Are they special assessments? yes, probably 
• Then what did the Legislature do? TEX. Loe. Gov’T CODE§ 399.014 shows that these assessments were to be treate dlike real property taxes

KP-210 (2018)

Home Rule City, Eagle Pass, wants to know whether City Council members who work for the school districtr can receive compensation for their city council service?

Attorney General Opinion KP-0211 says no. The Constitution prohibits. The only exception is teachers who may receive compensation for both. 

But, a school counsel probably meets the 3 point test. 

Where: Half Moon Bay, Califoria

What is the Half Moon Bay Ballot Proposition?

• To levy a tax on businesses headquartered outside of Half Moon Bay that currently deliver cannabis in the city
  • estimated to be $64,000 annually in tax revenue
• Establish a tax structure for all other commercial cannabis businesses that locate to Half Moon Bay
  • estimated to be $700,000 to $1.5 million a year in tax revenue
  • cultivation tax at $2 to $10 per canopy square foot depending on cultivation method
  • retail tax 6%of gross receipts
  • testing labs tax 2.5% of gross receipts
  • distribution tax 3% of gross receipts
  • manufacturing tax 4%  of gross receipts

Are marijuana related businesses currently permitted in Half Moon Bay? No

Does the ballot proposition change that? No

The Daily Journal | Marijuana tax to November ballot

State: Washington

How do the marijauna tax revenues look in Washington state:

• 1st year actual revenue: $64.9 million collected
  • 1st year estimated revenue: $36.3 million
• most recent fiscal year: $314.8 million
  • 262% more than estimated

How is marijuana taxed in Washington? 37% tax levy on all retail sales

How does WA spend its marijuana revenue? 

• substance-abuse education and treatment programs
• $262 million in 2018 went to fund WA’s Medicaid

How does CO spend its marijuana tax revenue? dedicated largely to education

IS WA marijuna revenue expected to plateau? No. $75 Million in growth projected through 2021.

K5 News | Why marijuana tax money isn’t a Washington state budget fix 

WHO | Activist Group:  Nebraska Taxpayers for Freedom

WHAT | Constitutional Property Tax Fix: 35% of local property taxes could be used to offset other state taxes. For Nebraska this could be the state’s income tax.

WHERE | Nebraska

The goal of Nebraska Taxpayers for Freedom: to get the Legislature to act in 2019.

Freemont Tribune | New property tax relief petition drive set to begin

Where:  Adelanto California

Background on Adelanto’s marijuana tax: In 2016 68% approved an up-to 5%  levy on gross revenue receipts for all commercial marijuana businesses

The current tax brings in: $2- 2.5 million

What will the ballot proposition do to the marijuna tax structure?

• $5-per-square-foot tax for cultivators
• all other marijuana business 5% on gross receipts

Daily press | Adelanto to ask voters to simplify marijuna tax

• City’s Credit Worthiness Could take a Hit.  “a hard liability (pension bonds) over a soft liability it can be seen as increasing the risk to the city’s credit quality”
• 2003 failure repeat.  Illinois  issued $10 Billion in pension obligation bonds in 2003 with no help to funding ratios in the pension systems
• Manageable Contribution Schedule.  Bonds must include a required manageable contribution schedule 

Bond Buyer | Chicago’s case for issuing pension bonds. 

1. The Massachusettes Legislature passes a measure calling for interim rules for fantasy sports with a sunset provision to require legislation
2. legislation fails to pass and the Legsislature removes the sunset provision
3. Fantasy Sports Operators continue to operate under the interim rules that have no taxation requirements

The Salem News | Fantasy sports remain untaxed  

Examples of calls for investments that relate to federal government actions:

• Pension Funds educators petitioned the California State Teachers’ Retirement System to divest from private prison operators that operate immigration detention centers
• All State Fund. New York State Comptroller Thomas DiNapoli divested state funds from private prison contractors that operate immigration detention centers
• Politician’s Personal Divestment. Republican Gov. Bruce Rauner of Illinois opponents are calling on his personal divestment from a private equity fund owned by a health care group servicing ICE detention centers
• University Contracts. University of Alabama at Birmingham, the University of Maryland College Park and Virginia Tech are being called upon to divest from ICE related contracts

Governing | Colleges, Cities and Pension Funds Pressured to Cut ICE Ties

A utility sales tax:  Most Texas cities repealed their sales tax on utiltiies in the late 1970s: 141 Cities in Texas repealed their sales tax on utilities

How can this sales tax be implemented: Some say it can be revived by city ordinance

Where is it being considered? El Paso as an alternative to raising property tax revenues

KVIA | ​City of El Paso Considering a Sales tacx for utility services. 

In repsonse to a Trib Talk by Mike Collier, Texas Comptroller Hegar says:

• Clear and honest look at Texas finances can be accomplished awith a revenue estiamte not geared toward a legislative session
• Consider the state’s credit worthiness to avoid making property tax changes that impact a looming balance-sheet issue
• “Gov. Greg Abbott, Lt. Gov. Patrick and members of the Legislature have worked to alleviate property taxes”
• The Office of the Comptroller does not raise or lower appraisals, it only “ensure[s] appraisals are fair and accurate”

Trib Talk | Texas Comptroller | Dishonesty won’t fix property taxes

The Report: CBPP’s State Limits on Property Taxes Hamstring Local Services and Should Be Relaxed or Repealed

4 State property Tax Caps that were studied: Michigan, Massachusetts, Oregon and New York.

3 Reommendations on Property Tax Caps

• Remove Property Tax Caps
• Amend caps to read, ”  limit the annual increase in property taxes to 1.5 or 2.5 percent or the rate of inflation, whichever is higher in lieu of whichever is lower.
• Include legislative” “circuit breakers,” which caps property taxes for people who make below a certain amount.”

Governing | The Downsides of Property Tax Caps

The states that require their pensions to be stress tested:

• California
• Colorado
• Connecticut
• Hawaii
• New Jersey
• Vermont
• Virginia
• Washington

Benefits of Stress Testing:

• explore the impact of pension system reforms
• more robust look than current baseline analysis of past results and future assumptions
• “sync the long-term sustainability of their retirement systems with their overall fiscal health”

Pew Charitable Trusts | States Turn to New Tool to Sustain Pension System Funding

State: Georgia

The tax passed by the Republican Legislature: a fuel surcharge on Delta airlines for removing a discount fare for NRA members

The Executive Order: July 30, 2018 Governor Deal

Background:  Republican GOvenror Deal is not seeking re-election

Supportors of the Executive Order Say:

•  Spurs growth in Georgia’s airline industry
• Georgia will remain competitive in the global economy
•  allows Delta to invest additional flights into Georgia

Tampa bay Times | Georgia jet fuel tax halted, months after Delta, NRA fight

San Diego City Council will consider a new deal with the San Diego State University to use the  SDCCU Stadium which will see the city receive:

• $1.1 million in revenue from the university annually
• City gets net parking and concession revenues (new to the city)
• The University will reimburse the city for game-day expenses
• City gets a $1 ticket surcharge 

The staidum will continue to have an operating deficit of $4.4 Milion for 2019.

KPBNS | SDCCU Stadium Agreement Advances To San Diego City Council

San Diego Union Times | SDSU Aztecs face $1 million rent hike to play football in ex-Chargers stadium

In June the US Supreme Court opened the door for legal sports betting in all states, pending state legislative approval.

Some jurisdictions, like India, are seeing a move for bitcoin to legitimize sports betting. How does that work?

• By allowing bitcoin as a legal currency for sports betting

Blockchain News & Tech | Could Sports Betting Help in Legitimizing Bitcoin in India?

Which states have the highest wine taxes?

• Kentucky $3.47 per gallon
• Alaska $2.50
• Florida $2.25
• Iowa $1.75
• Alabama and New Mexico tied at $1.70 

Which states have the lowest wine taxes?

• California and Texas at $0.20
• Wisconsin $0.25
• Kansas and New York $0.30

Do states add additional taxes to wine?

• Arkansas and Tennessee levy case fees
• Minnesota levies bottle fees
  • standard bottles taxed at $0.01 per bottle
  • miniature bottles taxed at $0.14 per bottle 

Tax Foundation | How High Are Wine Taxes in Your State?

State: Connecticut

Commission Exmaining Selling State Assets to Fund State Pensions: 13-member Pension Sustainability Commission

Pension Funding Proposal #1:

• Set up a state fund
• Funded by the sale of assets, like state real property
• The funds’ gains would shore up the pensions

Pension Funding Proposal #2:

• Dedicating state lottery proceeds to state pension
• Estiamted amount: $350 million in the current fiscal year
• Flaw: leaves a $350 million funding deficit in general revenue

Hartford Courant | New Commission Will Explore Selling State Assets To Shore Up Pension Funds

Art Carden,  an economics professor at Samford University’s Brock School of Business in Birmingham, AL, says:

• hotel revenue will not increase as much as cities think
  • for instance, the Carolina Panthers increase hotel revenue by less than 1% according to this study by economics professors in North Carolina 
• sales tax doesn’t make up for stadium costs
  • looking at the Carolina PAnthers again, the increased sales tax revenue during games accounts for less than 2.5% of the debt service on the satdium
• Evenif events increase gross tax receipts, they do not produce net tax revenue increases
  • 2017 PGA Championship cost Charlotte more in public safety related costs more than the increased hotel revenue

Forbes | Will A New Stadium Make Your City Richer?

In Illinois, a state representative proposes this plan to stablize pensions & lower property taxes:

• use the power of compound interest to help drive down massive pension costs
• level pension payments out over the next 25 years to reach funded status
• ensure that Illinois 
• annual pension payment would never rise above $12 billion
• “As the additional pension payments decrease from the initial $2.4 billion, the remainder should be used to lower property taxes on a per-pupil basis”

State Journal Register | Guest View: How to Solve the Illinois pension crisis & dramatically lower property taxes

Pennsylvania State Auditor released the following estimates on revenue from legalized marijuana:

• 800,000 regular users with estimated per person spending of $2,100 a year
•  retail market of  $1.7 billion
• $581 Million in annual revenue for PA
• 56% of Pennsylvanias support legalization
• based on a tax on the growth, cultivation and sale of marijuana at 35%
• Allegheny and Philadelphia counties were allowed to add 1-2% local tax, they could collect an additional $3.8 million and $6.9 million

Cumberlink Sentinel | Auditor sees state tax windfall if marijuana is legalized

New Hampshire joins the special session for online sales tax bill to consider a proposal  that calls for:

• protecting New Hampshire businesses from taxes imposed in other states
• to tax a NH based business, the state would need approval from the state Attorney General
• NH does not impose a sales tax on the sale of tangible personal property

How many think NH opposes the Wayfair decision? Correct. You are Correct.

Bloomberg Tax | Sales Tax Slice: Bills, Bills, Bills as No-Sales Tax States Seek to Counter Wayfair with Legislation

The Pennsylvania Supreme Court found that Philadelphia Beverage Tax is not a double tax.

What does the Philadelphia Beverage Tax apply to? Any non-alcoholic beverage that contains “any form of caloric sugar-based sweetener” or “any form of artificial sugar substitute”

Why is the “soda tax” not a double tax? because the legal responsibility for the tax is on the distributor & not the consumer- even if the tax is passed through to the consumer

Forbes | Double Tax Argument Falls Flat As Pennsylvania Supreme Court Rules Soda Tax Legal

The Hill | Pennsylvania Supreme Court upholds Philadelphia soda ban