Asking Coloradans to keep their refunds TABOR may be dead on arrival


Three billion dollars is a tempting number to throw in front of the Coloradans. It is the estimate that the governor’s budget staff projects will be returned to the Coloradans in the form of tax refunds by 2023 under the Taxpayer’s Bill of Rights, affectionately known as TABOR. It would also trigger a small income tax cut across the board.

TABOR, adopted almost 30 years ago, limits annual growth in state revenues to the sum of the annual inflation rate and the annual percentage change in the state’s population. In other words, if Colorado’s population grows 1.5% and the inflation rate is 3%, state revenues may increase 4.5% from the previous year. State revenues above this rate must be returned to Colorado taxpayers.

The expected repayment came because Colorado’s economy came back strong.

Statehouse Democrats are licking their chops at the prospect of spending that $ 3 billion on infrastructure projects, prisons, roads and education.

And who can blame them? TABOR’s formula for population growth and inflation does not take into account the pressure of demands on government or the costs of services like health care and roads.

The Democrats on Capitol Hill have all the power to hold the political trifecta: control of the governor’s office, the State House and the Senate, but they cannot do so without the approval of the voters.

Lawmakers would do well to understand the history and the political moment. If this issue continues to be on the agenda, opposition (and well funded) will form even before the plan is ready.

According to Ballotpedia, since 1992, voters in Colorado have rejected 16 of 22 statewide voting measures that would have increased revenues under TABOR. Five measures called on voters to retain income that would otherwise have been refunded. In 2005, when the state was more conservative, Referendum C was passed, allowing the state to keep and spend any money it raised above the TABOR limit. The money was used for health care, public education, transportation projects, and pensions for local firefighters and police for five years.

Despite Colorado’s shift to the left, recent history has not been so good. In 2018, the same election where voters gave Democrats control, they rejected by a 20% margin an initiative to allow $ 3.5 billion in transportation bonds and rejected a tax measure of $ 1. $ 6 billion statewide that would have increased funding for each student by 7%.

The following year, voters defeated the CC referendum, a backlashed law that would have allowed the state to also keep 7% of revenues for transportation and education. The committees responsible for the proposal spent $ 2.7 million more than the opposition.

This time around, lawmakers will have to explain why it’s even necessary since Colorado received $ 3.8 billion in American Rescue Plan Act state aid from President Joe Biden. Colorado has already allocated $ 2 billion and plans to appropriate the remaining $ 1.8 billion next year. This is a tremendous opportunity for the state, one that voters will watch closely. These funds must first be spent intelligently and convincingly, and then they must explain to voters why additional income is always needed.

State Senator Bob Rankin, R-Carbondale, who sits on the powerful Joint Budget Committee, told Denver Post’s Alex Burness, “It’s a ton of money and covers those same three years” when repayments are due. . “So why should we find clever ways to defeat TABOR when in fact we have all this federal money out there?”

If a referred measure is smart, that is also the way TABOR works and the issue of money retention is expected to be on the ballot in 2022, which is a major election year where Democrats will have more competitive races. the rest of the redistribution.

Republicans will try to portray Democrats as taxes and spending and will argue that Democrats have already found a way around TABOR through charges for infrastructure spending coupled with federal stimulus aid. Simply put, Democrats need bipartisan and community support.

And, they must aim carefully and thoughtfully at their target if they are to convince voters that supporting their package is more important than receiving a refund check.

To do this, they would have to consider a one-time lump sum request, as opposed to the permanence that was attempted by the CC referendum to keep reimbursement amounts for education and transportation. And, the list of project expenses should be shared statewide and should be for specific projects and investments so voters know exactly where the money is going.

Voters’ distrust of the government creates an easy “vote no” campaign.

With three more predictions before the end of the 2022 session, the amount of money to think about will change. If lawmakers take this problem seriously, it will take the passing months to come up with a plan that is not dead on arrival.

Doug Friednash is a native of Denver, a partner at Brownstein Hyatt Farber and Schreck law firm and former chief of staff to Governor John Hickenlooper.

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