Thursday, April 15, 2010

Survey Results

[Note on 4/19/10: Based on some comments from constituents, I have some additional clarifying language that is in italics below.]

Every year I send out an electronic constituent survey. Some members send out a mailing to all or some households with a survey and then someone has to tabulate all the results, which takes a long time, and it usually costs some taxpayer money to send out the survey. I prefer the electronic survey on Survey Monkey because it's cheap and about 90% of the constituents who contact me do so by e-mail, so I send the survey to all people who have e-mailed me since 2007. Survey Monkey also tabulates the data immediately.

This year the survey was sent to 888 people. So far 522 people have responded! To be a statistically valid survey, I would have to survey people at random, so one must take this fact into account when reading the results.

One of the House staffers who proofread the survey said, "It looks from the questions and the answers provided that you are actually interested how people respond?" YES! Many surveys do not actually provide that much useful data. However, I write my own surveys in order to help me with decision-making at the legislature on issues I will likely vote on. So here are the results along with some analysis.

Question 1. "Education Funding: Currently the Legislature plans to eliminate the $1 billion deficit by cutting parts of the state budget in virtually all categories except K-12 education. Cuts have been made or are being deliberated in higher education, the environment, agriculture, services for the disabled & seniors, etc. K-12 education comprises just under 40% of the state budget. Even if there is no cut to K-12 schools, previous state budget decisions are causing school districts to cut teachers, reduce class offerings, reduce related services, and/or ask for increases in property tax levies. What are your thoughts about what the Legislature should do about K-12 education funding?"

  • Without raising taxes, continue to cut other parts of the budget except K-12 to balance the budget: 23.5%
  • Without raising taxes, cut K-12 funding so that other parts of the budget are cut less, or just cut K-12 spending to balance the budget: 29.8%
  • Without raising taxes, increase funding for K-12 education by cutting other parts of the budget more: 6.3%
  • Raise taxes or other revenue to meet the needs of K-12 education: 37.0%
  • I don't know/I'm not sure: 3.5%
My take: There was strong support for K-12 education on this question. Just under 30% said we should cut education. Based on some of the written comments, some of these respondents are likely disability advocates who would like to see cuts to education equal to those taken by human services. Forty-two percent believed that the state should increase education funding either by raising taxes or cutting other parts of the budget. Another 23.5% preferred a strategy of holding K-12 education harmless when cutting the budget.

Some constituents have interpreted my comments above to imply that the majority of respondents wanted to raise taxes for education. My interpretation is that education has strong support because the majority of respondents don't want to cut K-12 education when we are cutting everything else.

Question 2. "One option for balancing the budget over the next few years is to limit or eliminate some tax exemptions, credits, or deductions that reduce revenue to the state. Studies show that some of these policies don't accomplish their intended goal (e.g., creating jobs, encouraging home ownership, etc.). Other policies favor one group of people (e.g., the wealthy or low-income) or one group of businesses (e.g., rural vs. all other) over another. Please indicate what your thoughts are about changing some of these tax policies. PLEASE CHECK ALL THAT APPLY."
  • I would support giving tax breaks just to people who really need it based on their income: 31.4%
  • I would support ending tax breaks that don't accomplish their stated goal: 52.8%
  • I would support changing tax policies so that everyone or every taxpayer pays the same percentage of income in taxes: 40.4%
  • The state needs to give more tax breaks because some or all taxes are too high; cut more spending to balance the budget: 29.6%
  • I don't know/I'm not sure: 1.4%
My take: The second and third questions have to do with what we call "tax expenditures." Each year, Minnesota does not tax certain people, businesses or items while taxing everyone else, and the lost revenue adds up to $11 billion a year. Some of these policies make a lot of sense--for example, we don't tax food. There is a perennial discussion about the wisdom of expanding the sales tax to clothing and professional services. In addition, some kinds of individual and corporate income have lower tax or less tax in order to provide tax relief, to be competitive with other states, or to promote a certain activity such as business development in depressed rural areas. See a list of them all on-line.

The purpose of the second question is to gauge how people view the fairness or utility of these tax breaks, and I asked respondents to check all items that they agree with. Only one response got more than 50% and that was to get rid of tax breaks that don't accomplish their goal. Less than 30% of respondents fit the most fiscally conservative position, which was to cut taxes and cut spending at the same time. I'm not really sure what I will do with the responses to this question, since the question was pretty complicated and there were quite a few complicated answers to pick from. Tax policy is very complicated and it's hard to boil down to a simple question. It's clear that respondents don't like tax breaks that serve no purpose.

Question 3. "The mortgage interest deduction is one tax break that could be limited at the state level. You can currently deduct all of your mortgage interest even if you have a house worth up to $1 million. People with expensive homes tend to benefit the most from the deduction; 41% of all mortgage interest deductions are claimed by the top 10% of income earners. Wisconsin does not allow mortgage interest deductions on state taxes and yet still has a higher home ownership rate than Minnesota. Please indicate your reaction to the proposal to change the mortgage interest deduction. (Note: this would not affect the more valuable federal mortgage interest deduction.)"
  • Do not change any policy on deducting mortgage interest: 31.0%
  • Limit the mortgage interest deduction to mortgages on houses worth $500,000 or less: 27.4%
  • Limit the mortgage interest deduction to mortgages on houses worth $250,000 or less: 12.3%
  • Get rid of the mortgage interest deduction and replace it with a tax credit that is the same for all homeowners: 12.9%
  • Get rid of the mortgage interest deduction altogether: 10.3%
  • I don't know/I'm not sure: 6.2%
My take: This question is a foll0w-up to the second question. One of the more well-known tax expenditures is the mortgage interest deduction. When you buy a house, you can deduct your mortgage interest from your gross federal and state income so that your taxable income is lower. The cost to the State of Minnesota of this deduction (and therefore a benefit to the taxpayer) is more than $400 million a year. People with higher incomes tend to benefit the most from this deduction because they tend to itemize on their taxes. You can deduct all of your interest for mortgages worth up to $1 million.

Half of all homeowners don't itemize and therefore don't take advantage of the deduction. Last year, the House proposed a bill that would have capped the mortgage interest deduction and then given all homeowners a credit. (Deductions reduce your taxable income but credits are better because they are dollar-for-dollar reductions in your taxes payable.) Most households would have done better under this proposal but it ran into a lot of opposition based on a lot of misinformation from opponents. My goal with this question was to see just how much that taxpayers understand about this deduction and what they would be willing to give up.

From the responses, more than 62% said that the status quo--that you can deduct all your mortgage interest even if you have a million-dollar mortgage--should change. However, the preferred method of changing the policy did not emerge in the responses. I admit that this question was pretty complicated.

Question 4
. "The Minnesota Vikings would like a public subsidy to cover part of the cost for a new stadium. Please indicate your thoughts on this idea.
  • I would not support using any public funding for a Vikings stadium: 46.4%
  • I would support using a user fee (e.g., limiting any tax to those who use the facility, hotels, parking, etc.) to support funding a Vikings stadium: 27.1%
  • I would support using a dedicated source of public funding like increased legalized gambling, a county-wide sales tax increase, hospitality tax, etc. for a Vikings stadium: 19.6%
  • I would support using public funding from any source for a Vikings stadium: 4.5%
  • I don't know/I'm not sure: 2.4%
Generally speaking I have been against public financing of stadiums. I was not in the legislature when the Twins stadium deal was approved so I missed that debate. When I go door-to-door the vast majority of local residents tell me that they they don't like public financing either. But since there's talk of a Vikings proposal, I thought it prudent to "check in" with constituents on the issue. Almost half of respondents said no to public financing and another quarter would only support a user-fee financing system, or a total of 73.5%. So it's pretty clear that constituents don't want to be on the hook for a stadium.

I got a lot of constituent e-mail about my interpretation on this question. As a result, I should state more clearly that a majority of constituents responding the survey don't want to have a broad-based tax to pay for a Vikings stadium. It's a bit of a stretch to say that the majority of respondents support public funding because that support is very conditional, but one could read the results to say a "user-fee" arrangement would have majority support among respondents.

Question 5. "The legislature is being asked to consider alternative teacher licensure for K-12 education. Advocates, including the Minnesota Chamber of Commerce and Teach for America, are concerned about the achievement gap between white students and students of color. They believe that the teacher licensing process needs to be easier in order to attract candidates to teach in underachieving schools. The proposed changes would include giving someone a temporary two-year license after they complete a bachelor's degree and 200 hours of training but that is not in a classroom. What are your thoughts about this proposal? Free free to add comments."
  • I strongly support the idea of an alternative teacher license: 16.2%
  • I would probably support the idea of an alternative teacher license: 27.5%
  • I would probably not support the idea of an alternative teacher license: 14.8%
  • I strongly do not support the idea of an alternative teacher license: 30.0%
  • I don't know/I'm not sure: 11.5%
My take: I got more "I don't know" responses on this than any other question, where 43.7% said they support or probably would support alternative licensing and 44.8% said that they did not. Education Minnesota (the statewide teacher's union) has been strongly against this idea and I have a lot of teachers who live in the district and who got this survey, which might explain the strong opposition to this idea at 30.0%. But I've met with some very thoughtful--and yes, some liberal--people who support alternative licensure in order to recruit more teachers of color and Teach for America volunteers who can help address the achievement gap. The Minnesota Chamber of Commerce is an advocate as well, and their position is on-line. The Obama Administration's rejection of Minnesota's Race to the Top application in part over alternative licensing is pushing stakeholders to get together on this issue, and I welcome the debate.

Question 6
. "Federal health care reform: Future state budgets and the health of Minnesotans will be impacted by the federal health care reform legislation passed by Congress in Washington, D.C. Under the legislation, it is predicted that hundreds of thousands of Minnesotans would receive health coverage; Medicare would be come more solvent; patients would not be denied coverage based on a pre-existing condition; and the federal deficit would shrink over time due to greater efficiencies. The legislation comes with new taxes, mandates, and participation by the federal government that are controversial. Since this legislation will have an impact on Minnesota, I would like to know how you feel about this legislation.
  • I support the legislation, but I don't think it went far enough: 21.6%
  • I strongly support the recently enacted federal health care reform: 12.2%
  • I support the legislation but I have some concerns about parts of it: 12.0%
  • I don't support the legislation, although there are some good parts to it: 16.0%
  • I strongly do not support the legislation: 35.5%
  • I don't know/I'm not sure: 2.7%
My take: While I'm not in Congress, I thought I would just see what people think about federal health care reform. There was strong opposition, with 51.5% of respondents not supporting the legislation and 45.8% supporting it. Those supporting single-payer or at least a strong public option likely picked the first answer about the legislation not going far enough. The level of support is actually higher than national polls and the percentage of people saying "I don't know" was lower than national polls. Many constituents asked me why I didn't leave a comment option for this question. It wasn't on purpose--I forgot to click the right box!

Thanks to all who participated in the survey!