An Evaluation of Alternative Tax and Expenditure Limitation Policies on Kansas Local Governments

Cross-sectional time series data in a partial adjustment model are used to examine county government fiscal behavior under a "hard" tax and expenditure limitation policy, an aggregate property tax levy limit, versus a "soft" limit under Truth in Taxation in Kansas. Results indicate that under the aggregate levy limit, per capita property taxes, own-source revenues and own-source expenditures were significantly higher than under the Truth in Taxation policy where local officials face many fewer restrictions on their ability to raise the levy.