In 1992, conservatives in Colorado celebrated their biggest victory, the Taxpayer's bill of rights (TABOR) which required the state to refund all tax revenue collected beyond a stipulated amount to the taxpayers in the state.
How has it fared?
Well, after it appeared that the provision was working during the early 1990's, a period in which Colorado experienced record growth which pushed the stipulated spending limit up rapidly, as soon as growth slowed, problems appeared. According to the National Conference of State Legislatures, a bipartisan group, once the economy slowed,
Contraction in electronics and telecommunications industries occurred rapidly in 2000 and 2001, shrinking the state economy and tax collections. Personal income grew only 2 percent from 2002 to 2003, the sixth worst rate in the country, when the national average was 2.8 percent. State employment shrank by 1 percent from 2002 to 2003, again the sixth worst rate in the country, when the national average was -0.1 percent....
The state's budget problems have been made worse by the interaction of an additional constitutional provision with the TABOR revenue limit. Voters in 2000 approved Amendment 23, which requires the General Assembly annually to increase base per pupil funding for K-12 education by inflation plus one percentage point a year through 2010, and by inflation thereafter. K-12 funding now accounts for 40 percent of the Colorado General Fund budget....
TABOR prevented the creation of a state rainy day fund through implication as well as its requirement that revenues in excess of a limit be returned to the voters. Reserves of 3 percent of the general fund are allowed, but any use must be repaid in the following fiscal year. Thus the reserve fund is more in the nature of a cash-flow reserve than a rainy-day fund.
In fact, things got so bad that Republican Governor Bill Owens, a supporter of TABOR when it first appeared, admitted that it has nearly bankrupted the state and has supported doing away with it.
So, today, despite massive spending from out of state conservative groups determined to see their crown jewel survive (Colorado is the only state with such a law, and it is touted by national conservative groups as a 'success,') the voters in that state went to the polls and voted to gut the bill. Referendum C, pushed by Owens and fiscally responsible Republicans in the legislature together with Democrats, essentially keeps the act 'in name only,' as it will allow the state to keep the money collected,
the measures would allow the state to keep $3.7 billion in Taxpayer's Bill of Rights refunds over the next five years to fund schools, roads and health.
Seems that conservative fiscal solutions are like a trip to the bar. They feel good at the time, but later on, those who vote for them (in this case the state of Colorado) wake up with a splitting headache, an empty wallet and a long way from where they want to be.