An (in)effective tax and expenditure limit (TEL): Why county governments do not utilize their maximum allotted property tax rate
| Published date | 01 June 2023 |
| Author | John W. Decker |
| Date | 01 June 2023 |
| DOI | http://doi.org/10.1111/padm.12756 |
ORIGINAL ARTICLE
An (in)effective tax and expenditure limit (TEL):
Why county governments do not utilize their
maximum allotted property tax rate
John W. Decker Ph.D.
The Hunt Institute, An Affiliate of the Duke
University Sanford School of Public Policy,
Cary, North Carolina, USA
Correspondence
John W. Decker, The Hunt Institute, An
Affiliate of the Duke University Sanford
School of Public Policy, 4000 Centregreen
Way, Suite 301, Cary, NC 27513, USA.
Email: winn.decker@gmail.com
Abstract
Tax and expenditure limits (TELs) are restrictions placed on
governments limiting their ability to collect and spend reve-
nue. Residents support these TELs, as they desire lower tax
burdens and more government efficiency; yet, residents still
desire the same level of public services. Property tax rate
limits, a specific type of TEL, are placed upon local govern-
ments to limit their ability to collect revenue and expand
authority. Rate limits were implemented on the assumption
that governments would tax at their highest maximum pos-
sible rate, but this is not always the case. This article studies
why some local governments choose not to utilize their
maximum allotted property tax rate. Using an open systems
governance approach, a panel data analysis was conducted
using data from 67 Florida counties from 2008 to 2017.
Results of the analysis show that the use of special districts
and the age of the residential population have significant
effects on property tax rate decisions.
1|INTRODUCTION
Tax and expenditure limits (TELs) are restrictions on governments that limit their ability to collect and spend revenue.
Property tax TELs come in various forms, including assessment limits, levy limits, and rate limits (see Mullins &
Joyce, 1996). Although each type of property tax TEL operates in different ways, all serve to limit local government
revenues and expenditures and control the growth of local government authority (Amiel et al., 2014; Maher &
Deller, 2013; Mullins, 2004). As of 2020, 48 states and District of Columbia, except New Hampshire and Vermont,
limit property tax rates or revenue in some form, making property tax TELs ripe for study (Stallmann et al., 2017; Tax
Policy Center, 2020).
Received:6January2021 Revised:16May2021 Accepted:16May2021
DOI: 10.1111/padm.12756
376 © 2021 John Wiley & Sons LtdPublic Admin. 2023;101:376–390.wileyonlinelibrary.com/journal/padm
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