That washer is the restrictor. When I bought my daughter a 2000 lt80 they gave me the restrictor for the exhaust and the carburator in a baggy. It looks like a fifty cent piece with a little hole in it.

 

It wasn't really a washer it was a pretty thin band kinda thing...?

 

If you're interested in squeezing power out of the LT80, check out: http://www.macdizzy.com/eltee.htm This guy bumped the Lts Hp from 6.49hp to 12.68hp. He has a lot of good ideas too. If anyone knows of other places that have tips on tricking out the LT, PLEASE post them.
Thanks