In 1980, at the peak of the stagflation-inspired tax revolt that had started in California, voters in Massachusetts approved a ballot initiative called Proposition 21/2. The statute capped local property taxes at 2.5% of real value of taxable property and also capped the annual growth in local tax levies at 2.5%.

At the time that Proposition 21/2 was enacted, Bay State residents were paying property taxes — as a percentage of their personal income — that were 71% above the national average. By 1997, the rate was only 9% higher.

This wasn’t a case of simply shifting the tax burden to other areas. In 1980, Massachusetts’s residents paid the second-highest state and local income taxes in the nation. In 2007, the state ranked 28th in the nation.

All the while, Massachusetts has maintained what many believe to be the best public education system in the country. As E.J. McMahon of the Manhattan Institute noted, its students in 2007 out-performed the rest of the nation on three of four National Assessment of Educational Progress exams and tied for first on the fourth.

Judging by these figures, it would seem that Proposition 21/2 worked; the state reined in taxes while its general economy and educational system thrived.

That’s the consensus of a New York State commission led by Nassau County Executive Thomas Suozzi, who is expected to release a report this week recommending that New York follow Massachusetts’s lead and impose a ceiling on local school property tax increases. The Suozzi commission is expected to call for capping annual tax growth at 4%.

The success of Proposition 21/2 is the most powerful argument against the teachers unions and their allies in the Legislature, which explains why these critics have now made it their highest priority to deny the achievement of our eastern neighbor and portray Proposition 21/2 as a failure.

Lining up against the Suozzi commission with force, they are citing a report published last month by the liberal Center on Budget and Policy Priorities in Washington, D.C., that purported to expose the “hidden consequences” of the Massachusetts cap.

The center’s case amounts to two criticisms: the cap eroded local services and hurt poor people.

But as many other studies have noted, the cap brought about a much smaller reduction in local revenue than had been anticipated. Increased state aid made up much of the difference, along with local voter overrides and taxes generated by new construction.

“Proposition 21/2 had been predicted to force draconian cuts in local services. Legislative amendments and economic growth, along with voter approval of additional property taxes on a town-by-town basis, have altered that prediction, and the public seems very satisfied with the result. There has neither been any serious attempt to repeal it, nor to strengthen it,” wrote a Northeastern University political science professor, Bruce Wallin, in a 2004 analysis of the cap.

What the center calls an erosion of services is often just efficiencies. “Many communities now have more professional management. It has forced all to work smarter in how we manage scarce dollars,” the mayor of Northampton, a city in Western Massachusetts, told Jay Gallagher of the Gannett News Service last month.

The center argues that the cap is unfair because rich communities can afford to vote for an override and tax themselves at higher rates. But the poorer areas have the same override power as the wealthier districts. If they opt for lower taxes over greater services, that’s their choice.

The best case against the cap goes as follows: Localities would cry out for more state aid to make up lost revenue. Albany would extend its hand, but at the same time, use its other hand to pick the pockets of New York City residents by raising income taxes on the state’s highest earners. The cap would then be nothing more than an excuse for Albany to soak the rich and funnel more of the city’s wealth to rest of the state.

The scenario is plausible — especially if voters oust the Senate Republicans from power this fall — but I see it as an argument in favor of a cap. When districts come to Albany hat in hand, Governor Paterson and lawmakers have a choice of either raising taxes or finding another way to come up with the money.

They can raise cash by squeezing other parts of the budget or tackle the source of the problem by repealing labor contract, pension, and other mandates that drive up the cost of government services.

Either way, the Legislature would be held accountable. Without a cap, accountability is so diffuse that voters don’t know whom to blame for their high taxes. A cap prevents the state from the passing the buck to localities and forces lawmakers and the governor to take responsibility for fiscal decisions.

Over the long run, the dynamic benefited Massachusetts. “In a broad sense, then, Proposition 21/2 has produced some centralization in the financing of local governments … but it also produced the ultimate in decentralization — voter control over local property tax increases,” Mr. Wallin wrote.

It sounds like common sense, which is why Albany is likely to ignore Mr. Suozzi. The county executive, who many believe is considering another run for governor in 2010, should know that voters are paying attention.

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