Category Archives: TABOR news story

May 23

2024 Colorado Legislative Session: TABOR Takings Tracker

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May 17, 2024 | 2024 Research, Featured, Recent Research, Taxes & Fees

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Author: Erik Gamm and Chris Brown

TABOR Takings Tracker

Legislators placed Coloradans’ TABOR refunds squarely in their crosshairs during the 2024 legislative session, having passed over 100 bills that would slash the TABOR refund to a quarter of its projected size if signed into law. Amid a period of state revenue growth in unprecedented excess of the Referendum C spending cap and a state budget larger than $40 billion for the first time in history, the state’s legislative majority has seen fit to circumvent the standard refund mechanisms through a long list of proposed tax rate reductions, tax credits, and redistribution efforts. Since the last issue of this report five days before the end of session, five TABOR-impacting bills were defeated, four new ones were introduced, and several others were amended heavily.

By the end of the legislative session, lawmakers passed 101 bills that will affect TABOR refunds. Most of these redirect money out of refunds towards targeted tax reductions for specific groups, mainly families and low-income Coloradans. Through such measures, the state will diminish taxpayers’ agency to decide, whether by saving, investing, or donating to charity, how best to allocate money that they would normally be owed. Voters rejected Proposition HH, which proposed to take TABOR refunds in exchange for limited property tax relief, just last November.

  • 101 bills were passed during the 2024 legislative session that, if signed into law, will reduce projected TABOR refunds by a combined $2.8 billion (47%) of the $6 billion projected between FY24 and FY26.
    • These bills propose to reduce the TABOR refund by a combined $523 million in FY24, $1.06 billion in FY25, and $1.25 billion in FY26. The recent announcement that an additional $67 million in TABOR refunds is owed to taxpayers due to an accounting error is not reflected in this report.
    • The reduction in refunds over the next three years is similar in size to the FY23 TABOR refund. Of the $3.28 billion available, $3.1 billion was distributed as direct payments of $800 to each Colorado taxpayer. The remaining $180 million was diverted via an expansion of the Earned Income Tax Credit approved during the 2023 session.
    • The two most impactful bills from the 2024 session (see the list below) will reduce TABOR refunds by $1.8 billion, more than 42%, between FY25 and FY26. The rest of the bills would reduce refunds by a total of $391 million (9%) over that period.
    • Some major bills, like SB24-166, were lost in the final days of the session.
  • SB24-228, which is expected to be signed into law shortly, proposes to change the TABOR refund mechanism by lowering the state income tax rate according to the level of excess state revenue. When it comes into effect, Coloradans’ TABOR refunds will be partially replaced by income tax reductions.

The figure below shows projected TABOR refunds in the next three fiscal years and the amounts of those refunds that each bill would remove.

2024 legislation will reduce the current fiscal year’s TABOR refund to $1.3 billion, which is 71% of the latest projection.

2024 Colorado Legislative Session: TABOR Takings Tracker

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May 23

EDITORIAL: Faux refunds preempt Colorado’s taxpayers

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    • The Gazette editorial board

052024-dg-editorial-1

The Colorado State Capitol (Gazette file photo)
Our state government is required under Colorado’s constitution to refund excess tax revenue. Any year-to-year increases in collections above the rates of inflation and population growth combined must be returned to the public. Hence, taxpayers’ “TABOR refunds.”

When it comes to the actual process for returning the money, however, there’s a lot of wiggle room. Too much.

Exhibit A is a package of bills adopted near the end of the 2024 legislative session earlier this month. As we noted here then, the legislation hijacks Coloradans’ TABOR refunds, doling them out through a combination of temporary tax cuts and credits. It further complicates a refund mechanism that already was complicated enough thanks to previous legislative tinkering.

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May 23

Colorado taxpayers to lose $2.8 billion in TABOR refunds due to legislature, study shows

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Common Sense Institute says the state reduced just less than half of expected TABOR refunds to Colorado taxpayers between 2024 and 2026

 

Capitol Building in Downtown Denver Colorado Photo Credit: Boogich (iStock).
Photo Credit: Boogich (iStock).

The $2.8 billion loss is just less than half of the projected $6 billion in TABOR refunds for the next three years, CSI found in its report following the 2024 Colorado legislative session.

“Legislators focused intensely on TABOR refunds this session,” CSI Mike A. Leprino Fellow Lang Sias said in a statement.

“What started a few years ago,” he said, “has snowballed into what we saw play out during the 2024 session where more than 100 bills redirected TABOR refunds.”

TABOR refunds come from excess state revenue that is sent back to Colorado taxpayers in the next fiscal year.

Over the next three years, Colorado taxpayers will lose $2.8 million in TABOR refunds mostly due to tax cuts, and due to the cost of the bills impacting TABOR, according to CSI’s TABOR refund report.

TABOR refund reductions will increase over the next three years, according to CSI’s report.

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May 14

Gaines: Getting back from the state what we’re owed under TABOR

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Pretend that your employer accidentally overpaid you, say $20 extra a month for a couple years.  Neither of you notice until one day you get an email telling you about the mistake.  The mistake has been fixed and your pay will be $20 less going forward.  Also, you now owe your employer $240.  Not a pleasant thing to consider.
Fresh on the heels of Governor Polis signing the state budget, we got similar bad news.  Due to an accounting error there’s a $67 million “oops” in the budget.
The mistake stretches all the way back to the hurried 2020 legislative session and a bill rushed through for Polis’ signature.  SB20-215 created the Health Insurance Affordability Enterprise, another of those government-run “businesses” which attaches a fee to many health insurance policies (any policy regulated by the state’s division of insurance).
These fees go to Governor Polis’ pet reinsurance programs as well as subsidies for low-income residents, including, incidentally, those here illegally.  Like all enterprises, this revenue was not subject to the revenue limits the Taxpayer’s Bill of Rights (TABOR) puts on the government.
So far a pretty standard example of how our legislature likes to meet its priorities, not by the consent of those that foot the bill, but by taking without asking first.  The problem came in because someone, somewhere in the state government, screwed up.  I can’t quite seem to find out the exact details, but someone goofed.  Tax revenues from the state’s general fund were going to this enterprise, as they were supposed to by an earlier law and no one kept the money separate.
They should have been separate because the general fund dollars are decidedly not exempt from TABOR limits.  The state was keeping money above TABOR limits pretty much since the start of this enterprise, shorting us on money we are owed.  As I say above, the exact details of who knew and when are not too clear to me; I have seen different versions in different news stories.  Some say that no one on the legislature’s Joint Budget Committee knew until after the budget was signed, the legislators being kept in the dark while the state controller and the attorney general were trying to see if they did indeed have to return the money.
If you have seen headlines on this problem, you may or may not have noted a discrepancy in the dollar amounts.  Some articles say $67 million, some say $34.  Both are right, but the semantics are important.  The total owed is $67 million:  $33 million for this year and $34 million for the past couple years of overpayments.  If I return to my analogy from before, you could liken the $34 million to the $240 you’d owe your employer, the $33 million to the $20 loss on your current check, and the loss of that $20 per month in the future to the problem the state has in trying to figure out how to fund the enterprise fully going forward.
Going forward is pretty simple.  Perhaps not pleasant, but simple.  A bill is already working its way through the legislature to make sure that this problem doesn’t recur.  Working in descending order, the next problem is how to pay the $34 million overcharge from this year.  That one will likely get paid, at least in part, by not sending general fund revenue to the enterprise this year.
Lastly, the thorniest problem, the one that I think seems to be causing the most heartburn is how to pay taxpayers back the $33 million they’re owed from the last two years.  I had to laugh when I read up on this issue because some Democrats, the same ones that howled about the irresponsibility of using the state’s reserves to help temporarily drop property taxes in the last special session, are now perfectly okay with dipping into said reserves to pay taxpayers back.  Funny how quickly reckless financial irresponsibility isn’t reckless anymore when the political need is big enough.  Tapping reserves carries a couple problems, however.  First, the legislature must enable this to happen because this size of a hit puts us below the statutory minimum, and somehow, at some point in the future, that loss would need to be made up.
Another route open to our legislature would be to reduce spending.  They could simply not spend as much this session and put that money into refunds.  You know, kind of like when you have to forego some spending you wanted due to unexpected bills.
I marvel at this whole story.

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May 09

EDITORIAL: Rein in violations of taxpayer’s rights

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EDITORIAL: Rein in violations of taxpayer’s rights

    •  Updated 

BIZ-WRK-ACCOUNTING-WORKLIFE-DMT

The 2024 tax and audit season, which generally stretches from mid-January to mid- or late April, hasn’t been quite as challenging as it was in pandemic years, industry experts said.

Government is supposed to be of, by and for the people. That’s why Colorado voters passed the Taxpayer’s Bill of Rights in 1992, forcing the state government and other taxing jurisdictions to obtain voter approval before raising taxes or spending revenues that outpace inflation and population.

Moments after voters passed the law, politicians began routing around it. They began levying and/or raising car registration “fees,” energy production “fees” professional registration “fees,” doing-business “fees,” plastic bag “fees,” phone “fees,” tire “fees,” alcohol “fees” and much more.

Politicians who don’t want to ask for a tax increase — those who think they know what’s best for other peoples’ money — learned early on they could call a “tax” a “fee” and from TABOR become free. Courts, which make up a major component of state and local taxing jurisdictions, have gone along with this ruse.

Boldly flouting federal law, the Colorado Legislature recently passed Senate Bill 184 to impose a “Congestion Impact Fee” on rental vehicles. The money will go to fund passenger rail and other Democratic pet projects marketed as good for the climate.

To continue reading this story, please click (HERE) to at the Denver Gazette.

Apr 27

Colorado lawmakers are plotting to steal billions of your tax rebates

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Apr 22, 2024

Coloradans are supposed to get $2 billion back in their wallets through Taxpayer Bill of Rights (TABOR) tax refunds this year, but Democrat lawmakers have other plans to spend our rebates.

Their wish list already exceeds $1.5 billion with programs that are guaranteed to grow even more expensive year after year, reports Colorado Politics.

Topping the Democrats’ list is the reincarnation of cash welfare payments that were eliminated back in the 1990s because it kept families living in poverty and dependent on taxpayer programs for every necessity.

Colorado wants to revive government-dependence and pay people for each child they have and call it a tax credit — except it goes to people who pay a pittance in taxes.

The problem with these child tax credits is that it suddenly made sense for one parent to stay home and collect government checks rather than work.

PeakNation™ will recall Colorado U.S. Sen. Michael Bennet first convinced Biden and the Democrats to bring back cash welfare payments during COVID.

Bennet tried to make those cash payments permanent when he was campaigning for reelection.

To read the rest of this TABOR article, please click (HERE) to go to Colorado Peak Politics.

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.

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Apr 10

HB24-1311 Redistributes YOUR TABOR REFUND.

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Good day,
Natalie and I recorded this video last night.
It’s about HB24-1311, Family Affordability Tax Credit. This nefarious bill redistributes our TABOR rebate money into a tax credit.
It’s one of the biggest attempts in years to take away TABOR rebates.
Please watch and share: https://youtu.be/VgneAypMu-8
Thank  you,
Brandon Wark
FreeStateColorado.com

Apr 07

Colorado Voter Survey Reveals Major Disapproval to Proposed Alcohol Tax

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Colorado Voter Survey Reveals Major Disapproval to Proposed Alcohol Tax

Shawnee Adelson, Colorado Brewers Guild
https://coloradobeer.org/ 

A newly proposed 200 percent hike in alcohol taxes from Sens. Kevin Priola (D-13th District) and Chris Hansen (D-31st District) has been met with strong opposition from Colorado Voters.

In a newly published survey by Nelson Research, the proposal, SB 24-181, “loses support among all major
demographic subgroups as more information is known about the funding mechanism and impacts on
economy, democratic process, small business/consumers, and overall lack of prioritization of current alcohol tax dollars.” Starting with a 2-to-1 general disapproval of alcohol taxes (48.9% opposed vs. 23.3% approve), the measure only fares worse once voters learn how the bill was structured to get around Taxpayer’s Bill of Rights (TABOR) provisions as well as its effect on Colorado’s economy. Its final disapproval rating is 58% with just 26% in favor.

In addition to the provision itself, voters also rejected the plan to label this tax as a “fee” by 61-21 percent.

This poll is clear and overwhelming evidence that Coloradans reject higher alcohol taxes. We hope that the bill sponsors listen to their constituents.

The survey was conducted from March 25 – March 27, 2024. The survey consisted of 538 registered voters in Colorado. The sample size (n=538) is sufficient to assess voter sentiment within a margin-of-error of +/- 4.2% at a 95% confidence level.

Further polling insights include:
? Opposition to a 200% tax increase: Results when told the bill raises the tax on beer, wine and liquor by
200% – or three times the current tax level. 22.1% In Favor & 66.0% Opposed
? Economic impact: Results when told Senate Bill 24-181 would hurt Colorado’s vibrant tourism
economy as it would cost local restaurants, brew pubs and craft breweries over $25 million in lost retail
sales. 16.6% In Favor & 70.4% Opposed
? Current tax allocation: Results when told the state already collects millions of dollars in alcohol tax
payments, but does not prioritize treatment and recovery services. Respondents were asked if legislators
should prioritize the way they currently spend their alcohol tax dollars instead of requiring more taxes.
65.0% Agree or in favor & 40.7% Opposed

Colorado Voter Survey Reveals Major Disapproval to Proposed Alcohol Tax