Category Archives: Legal Issues

Apr 27

Martinez: Court sends a reminder; tax hikes require voter consent

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 By Tyler Martinez

In a major victory for taxpayers, a unanimous panel of the Colorado Court of Appeals agreed with the National Taxpayers Union Foundation’s Taxpayer Defense Center (NTUF) that an overnight doubling of the property taxes in a few Northern Colorado counties violated the Colorado Taxpayer’s Bill of Rights (TABOR).

We represented James Aranci and his neighbors, who were shocked to learn in 2020 that their property taxes to the Lower South Platte Water Conservancy District doubled from 2019 to 2020 (and the years thereafter). TABOR mandates a ratification vote of any proposed tax increase or new debt taken on by government entities–including water districts. But there was no vote from Aranci or anyone else. So we came to help in their challenge to this unconstitutional tax increase.

The court held in this case that the doubling of the rate increased the tax revenue to the water district, and thus there should have been a TABOR vote.  The court read the relevant case law in the same way as we did, holding that Huber v. Colorado Mining Association–which was about a ministerial tax adjustment based on inflation–did not apply here, where the water district had a lot of options for balancing its budget.

To continue reading this story, please click (HERE) to go to Complete Colorado.

Apr 15

Democrats unveil new plan to gut TABOR and direct money to anti-poverty measure

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Democrats unveil new plan to gut TABOR and direct money to anti-poverty measure

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Table showing child tax credit amounts for Coloradoans with children age 16 or younger under House Bill 1311 by adjusted gross income level, child’s age and filing status. The credit is available for single filers with an adjusted gross income up to $85,000 and joint filers with a gross income up to $95,000 and decreases as income increases.
Data: Colorado Legislative Council; Table: Axios Visuals; Colorado is forecast to refund $6 billion in surplus tax collections in the next three years.

Colorado is forecast to refund $6 billion in surplus tax collections in the next three years.

Yes, but: Democrats want to redirect one-third, or roughly $2 billion, to parents making less than $95,000 through a child tax credit under a new bill.

  • The maximum tax credit for a child under age 6 would be $3,200 and $2,400 for children 6-16.
  • The amount of the tax credit would decrease by hundreds of dollars for every $5,000 in income, a fiscal analysis shows.

Continue reading →

Mar 24

Water district subject to TABOR vote requirement

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Water district subject to TABOR vote requirement

Water districts are like all other government entities that are subject to the Taxpayer’s Bill of Rights when it comes to voters approving tax increases, the Colorado Appeals Court ruled Thursday.

In a precedent-setting case out of Logan County in the northeast corner of the state, a three-judge panel overturned a lower court’s decision that the Lower South Platte Water Conservancy District that serves four Eastern Plains counties violated TABOR by doubling its mill levy starting in 2019 because it did so without voter approval.

The lower court had ruled in favor of the district, saying its raising of the levy from 0.5 mills to 1 mill did not violate that 1992 constitutional amendment because the water district was formed before TABOR was approved, and is required under the state’s Water Conservancy Act to set a mill levy based on a mandatory and non-discretionary formula.

The water district tried to argue that the Colorado Supreme Court, in Huber v. Colorado Mining Association, allows such mill levy increases because of that formula.

But a three-judge panel said that high court ruling applies to entities that aren’t making a legislative or governmental act for a tax-rate increase, but a non-discretionary duty under pre-TABOR taxing statutes, such as the Colorado Department of Revenue making legally required adjustments to severance taxes. Continue reading →

Mar 22

A TABOR Lawsuit Victory

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Residents in the northeast corner of Colorado contacted the TABOR Committee several years ago about a tax increase imposed without voter approval by their local Water Conservancy District.  Our organization kicked off the response with an attorney’s letter warning the District to reverse course.  It did not.  After other subsequent efforts, a lawsuit was filed by those residents.  Two public interest law firms have done the legal work.

Although a lower court allowed the District to increase taxes, the very good news is that the Colorado Court of Appeals recently ruled for the taxpayers!  The case still can be appealed to the Colorado Supreme Court, and if not heard there, the trial court must still resolve several questions, so the lawsuit will continue.

The importance here is that the Colorado court system has confirmed the primacy of the Taxpayer’s Bill of Rights and protected the taxpayers in that District.

 

Penn Pfiffner
Colorado TABOR

Mar 15

Menten: Open letter to the Colorado Commission on Property Tax

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Dear members of the Commission on Property Tax:

The commission was tasked with providing property tax relief options before the temporary tax adjustments expire at the end of 2024.

The obvious  answer is to restore inflation and growth adjustable property tax revenue caps where they’ve been forfeited in prior elections. Good news – that’s already in the Taxpayer’s Bill of Rights (TABOR) but it needs to be reinforced!

If that doesn’t happen, there will be a hard property tax cap on the 2024 ballot. That’s been clearly stated by two of the proponents of property tax caps if there was insufficient actions from the commission.

Taxpayers want tax caps whether they are hard or inflation adjustable. Taxpayers like me understand that government growth should be relative to the size of the local economy. That is rightly answered in the existing property tax limit contained in TABOR, paragraph 7c, which allows for such growth.

Having sat through all the commission meetings, there’s a few moments I want to highlight.

Bring back the tax caps

In this three minute video, the county assessor from Santa Clara, California described where that state sits now under the Proposition 13 property tax caps. His points illustrate why our Colorado TABOR is ideal. The assessor points out that local California governments didn’t appropriately reduce property taxes in 1978, even referring to property taxes as “money machines.” So, California voters used their right to petition to place a hard tax cap on the ballot, which became Proposition 13. Continue reading →

Jan 12

ALEC on American Radio Journal: Colorado’s Taxpayer Bill of Rights Turns 30

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This month marks the 30th anniversary of Colorado’s Taxpayer’s Bill of Rights (TABOR), which was approved by voters in November of 1992 as a constitutional tax and expenditure limit (TEL). TABOR is considered the gold standard of state fiscal rules because it limits the growth of most of Colorado’s spending and revenue to inflation plus population. If the state government collects more tax dollars than TABOR allows, the money is returned to taxpayers as a TABOR refund. The receipt of tax rebates, totaling $8.2 billion since TABOR passed in 1992, has strengthened Colorado citizens’ confidence in the TABOR Amendment over the years. To learn more about TABOR and effective TELs, read our latest report and visit FiscalRules.org

 

Jan 12

Polis Pitches Tax Cuts, But His Democrat-Run Statehouse Isn’t On Board

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Polis Pitches Tax Cuts, But His Democrat-Run Statehouse Isn’t On Board

Patrick Gleason, Contributor
I cover the intersection of state & federal policy and politics.

Dec 15, 2023,05:40am EST

Colorado Governor Jared Polis (Photo by Michael Ciaglo/Getty Images)
GETTY IMAGES

If Texas Governor Greg Abbott (R) were to coauthor a New Republic column with Paul Krugman or another famous progressive economist touting the benefits of greater government spending, that would surprise many. Yet the ideological analog to that occurred recently, with Colorado Governor Jared Polis (D) coauthoring an article with economist Arthur Laffer, in which they tout the benefits of reduced tax rates. Governor Polis and Dr. Laffer also contend that the Taxpayer’s Bill of Rights (TABOR), Colorado’s thirty one year old constitutional amendment that prevents state spending from growing faster than population growth plus inflation and requires tax hikes to receive voter approval, is flawed.

In their op-ed, published in National Review on December 7, Polis and Laffer lament that tax limitation measures “such as Colorado’s Taxpayer’s Bill of Rights, that focus on tax payments rather than tax rates totally miss the opportunity to address the damage done by high tax rates.” Polis and Laffer bemoan the fact that TABOR surpluses are not automatically refunded in the form of tax rate reductions and instead go out as rebate checks.

“If there is an excess in tax revenues above population growth and inflation, as defined by TABOR, that means tax rates should have been lower but were not,” write Polis and Laffer. “The law serves as a signal that tax rates have been too high. The proper response to this signal is not to have it keep signaling, but to get the message and cut tax rates permanently.”

What’s more, Governor Polis’s stated desire for tax rate reductions is belied by his enactment of a bill that will make it more difficult to pass income tax cuts in the future by ballot measure. That new law, which was signed by Polis in 2021, mandates that citizen-initiated income tax cuts feature poison pill ballot language claiming the measure will reduce funding for education, healthcare, and other priorities, even when that’s not true.

Colorado House Minority Leader Mike Lynch (R) and Senator Byron Pelton (R) introduced a bill during last month’s special legislative session that would have reduced Colorado’s income tax rate from 4.4% to 4.0%. Governor Polis acknowledges the economic benefits of lowering income tax rates in his recent column, yet he did not support that bill, which was killed in committee along party lines.

Click (HERE) to go to Forbes to read the rest of this article

Jun 20

Coloradans have voted on 36 TABOR-related ballot measures since 1993, rejecting 69% of them

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Coloradans have voted on 36 TABOR-related ballot measures since 1993, rejecting 69% of them

By Jackie Mitchell
In Ballot measures
June 19, 2023 at 9:57 PM

Coloradans have decided on 36 statewide ballot measures that were designed to increase revenue for the state, which required voter approval under TABOR. Of the 36 measures, 11 (30.56%) were approved and 25 (69.44%) were defeated.

Colorado’s Taxpayer’s Bill of Rights (TABOR), adopted in 1992, was designed to require statewide voter approval of all new taxes, tax rate increases, extensions of expiring taxes, mill levy increases, valuation for property assessment increases, or tax policy changes resulting in increased tax revenue.

Of the 36 measures, 17 were referred to the ballot by the state legislature and 19 were placed on the ballot through citizen initiative petitions. Of the 11 approved measures, 10 were referred to the ballot by the state legislature and one was a citizen initiative.

Highlights:

 

  • 14 of the measures were designed to increase a tax. Of the 14 measures, two were approved and 12 were defeated. In 2004, voters approved an initiative to increase the tobacco tax to fund educational and healthcare programs. In 2020, voters approved a measure placed on the ballot by the state legislature to increase tobacco taxes and create a tax on nicotine products to fund health and education programs.

Continue reading →

Jun 20

TABOR and the 2023 legislative session

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TABOR and the 2023 legislative session

We follow the bills as best we can, but do not rate them, relying instead on the excellent and thorough Colorado Union of Taxpayer’s work and that done by others, such as the Republican Liberty Caucus.  There were a few good ideas and plenty of bad ones, but we focused only on those that affect TABOR.

The General Assembly pretty much left the Taxpayer’s Bill of Rights alone until the final week of the legislative session.  Then, legislators dropped a big negative on Colorado with a bill to place Proposition HH on the ballot this fall.

The entire idea is bad.  It is very complex and convoluted legislation that proponents tout as lowering your property taxes.  It fails.  The Gallagher Amendment was repealed a couple years back.  That action removed the method to tamp down increases in residential property taxes.  With property taxes threatened to soar next year, Proposition HH (Senate Bill 23-303) takes money owed back to the taxpayer to reduce some (perhaps half) of the property tax increase.  It literally uses a big tax increase by taking your TABOR rebates in order to pay down your property tax increases!  Dastardly.  Sneaky.  Terrible.

What is your TABOR Committee doing about it?  We brought together like-minded organizations to protect TABOR by defeating this crumby, lose-lose measure, in which only the government benefits.  The new coalition will function as a clearinghouse and share ideas and efforts, although no strong core has materialized as yet.  Your TABOR Committee already filed to set up a statewide issue committee (a legal necessity to conform to election requirements).  We funded it with seed money and secured a matching donation.

Are you torqued off yet?

Please join the fight by volunteering.  Let your interest be known by emailing info@TheTaborCommittee.com or calling 303-747-7460.  Please also donate to our efforts by sending a check to the TABOR Coalition at 720 Kipling, Suite 12, Lakewood 80215.

Proposition HH has more pieces to it – a hike in the State revenue and spending limitation that allows government to grow faster than the private sector and a provision about the senior exemption.  One of our allies filed a lawsuit because the measure violates the single-subject rule.  It has been joined by a dozen local governments!

A different measure on the fall ballot asks voters to allow the State to keep higher marijuana taxes.  A provision in TABOR requires proposed tax increases to estimate the amount to be raised.  In order to keep governments from monkeying with the estimate, any overage must be returned and the rate adjusted downward, unless the taxpayers in a second vote allow the higher receipts.

There was another anti-TABOR bill that adjusts some definitions on insurance premiums taxes.  TABOR does not allow arguments that any higher taxes are too little to care about (de minimis).  But, in a lawsuit several years ago filed by the TABOR Foundation (our sister organization), the Colorado Supreme Court errantly imposed a de minimis provision.  We cannot fight the precedent set then, and the amount this year truly is small – less than $7,000.