Last Monday, Colorado Gov. John Hickenlooper unveiled the state’s $26.8 billion proposed budget for next fiscal year. The budget includes $167.2 million in tax rebates for Colorado taxpayers, including $30.5 million in rebates due to total state revenue that was higher than predicted. Under the Colorado Taxpayer’s Bill of Rights (TABOR) the state must either refund the excess amount above the estimate,or add a measure to a future ballot asking the voters to let the state keep and spend the surplus.
The rebates are mandated by TABOR, because the revenue from marijuana sales is different than projections included in the election book for the 2013 Proposition AA. Under TABOR, since the estimate was off, the state has to either refund the excess cash or go to voters to ask if the state can keep it.
The budget proposal was announced one day before the Nov. 4 election that gave Hickenlooper another term. The spending plan includes a 7 percent increase from the current year’s budget, representing $1.7 billion in new spending of state and federal money. $908 million in state spending includes $107 million in additional funds for higher education, $103 million for road projects and a 2 percent pay hike for many state employees.
Colorado’s economy is improving, but much of the new money is due to tax collections exceeding the state’s revenue cap, triggering rebates under TABOR for the first time in 15 years. The provision requires refunds if the revenue is greater than the rate of population growth and inflation. Unless, that is, the voters decide to return the money.
Hickenlooper’s budget directs $167.2 million of the TABOR rebate for fiscal year 2015-16 toward a tax credit for low income workers, along with sales tax refunds. He did not address exactly how to rebate the $30.5 million portion for recreational pot taxes, that decision being left to state lawmakers.
The rebate issue became a campaign issue last month when the governor was noncommittal on whether he would endorse a tax rebate, or if he would ask voters for permission to spend it. At a gubernatorial debate Oct. 24 he did commit to a rebate.
Vice Chairman of the Joint Budget Committee Sen. Pat Steadman said the overage is not happening because the taxes are exceeding the estimates, but rather because the economy is growing. Hickenlooper stated that “Colorado’s economic activity continues to outperform the national expansion,” and said looking ahead, the most likely scenario is for that momentum to continue.
Lawmakers have the option to lower excise and sales tax rates on recreational pot to bring the revenue in line with projections, but that would most likely impact $40 in annual excise tax revenue that has been allocated to school construction. Rep. Cheri Gerou, a member of the Joint Budget Committee, said lowering the sales tax rate would mean the state could not take care of K-12 education under BEST, the Building Excellent Schools Today program.
So much of the marijuana revenue is allocated for school construction and reimbursing counties for regulation expenses that it is possible that the cannabis refund would have to come out of the state’s general fund. It is uncertain how the pot tax rebate will be handled, whether it will go to all Colorado taxpayers or only to those who bought recreational marijuana. Gerou said that despite the higher-than-projected revenue, legalized recreational marijuana could actually cost the state money in this first year.
By Beth A. Balen
Read more at http://guardianlv.com/2014/11/colorado-residents-looking-at-pot-tax-rebate/#fgIF8cuuEo3AYXHk.99
Friends of freedom,
As the TABOR Committee approaches its annual business meeting on Saturday, November 15th, we thought to invite you to join our team.
If you are not currently engaged in an effort to advance liberty, please consider that you could make a difference with one to two hours per week of dedicated volunteering. You likely would benefit too, perhaps building a resume’, gaining insights unavailable from the sidelines, and fulfilling your interest for successful activism and leadership.
The TABOR Committee and its sister organization, the TABOR Foundation, have been punching far above our weight, including initiating lawsuits against the Bridge Enterprise scheme and against the new RTD and Scientific and Cultural Facilities District taxes. We filed an amicus brief in the Lobato lawsuit and acted in the federal lawsuit (Kerr vs. Hickenlooper) as the lead amicus in alliance with the NFIB’s national office legal team – the same outfit that filed the lawsuit against ObamaCare which ended with the Roberts’ decision. (The Kerr lawsuit avers TABOR unconstitutional under the US constitution). We also have taken tangential roles in the Aspen bag fee lawsuit and the lawsuit pertaining to the TABOR vote on the Gaylord Convention Center. Our other ongoing volunteer work includes
– development of histories of TABOR campaigns leading to passage,
– producing a TABOR 101 introductory video,
– research and authoring a legal history of the various TABOR decisions over the decades,
– providing articles to the media,
– running a web site,
– presenting a break-out session at the Western Conservative Summit (completed – 2014).
We would like to build on that. A deeper bench is needed, with more interested people involved so that languishing projects move forward.
My request of you is to become involved in policy & politics to preserve and advance the Taxpayer’s Bill of Rights. We need more help:
The committee that should be sending out a speaker’s bureau is moribund, because our Outreach Director’s professional life has taken a new direction. We need a small team with the skills and attitude to schedule the speakers bureau, organize the speakers’ training, coordinate feedback and lessons learned. If Bell Policy/Colorado Fiscal Institute soon launch a renewed attack on TABOR as expected, we will discover the libertarian/conservative movement is already behind.
We should recruit more support and organizing help in producing the TABOR 101 videos.
A major objective within our mission statement has gone unaddressed – the offer to support other states’ efforts to pass their own TABORs. We have not followed up adequately on expressions of recent interest from Kansas, Florida and Arizona. A leader with diplomacy skills and dogged determination would be a wonderful addition.
Citizens in Charge/Paul Jacob has planned to put national attention to TABOR during the coming spring with a series of different activities and a symposium. We don’t currently have the volunteer time available to support his plan, coordinate and collaborate with him, and to create successful events.
Your response and support will be greatly appreciated.