Gov. John Hickenlooper issued an election-eve budget plan that supported taxpayer refunds next year, but his Democratic colleagues in the legislature are openly considering a move to spend the money.
The talk comes as the Joint Budget Committee continues preliminary meetings to craft the state budget and raises the specter of an intraparty showdown on one of the top legislative issues in the upcoming 2015 session.
Under the state’s Taxpayer’s Bill of Rights, Colorado must return any tax collections in excess of its constitutional revenue cap, which is set by the rate of inflation plus population growth. Right now, the state forecasts a potential $130 million refund.
In a recent interview, noted in a story looking at Hickenlooper’s second term, incoming House Speaker Dickey Lee Hullinghorst made the most direct suggestion that Democrats may support a ballot measure in 2015 to ask voters to keep the money for state spending instead of issuing a refund
“If we don’t do anything as a state, we are going to be spending almost as much money as we refund, refunding money to people, which doesn’t seem to make a lot of common sense to me,” the Boulder Democrat said. “The people would be far better off if we invested that in infrastructure, education — something that really benefited them rather than (them) getting their 50 bucks to spend on a tank of gas or something.”
Hullinghorst didn’t elaborate, but the cost for refunding TABOR is typically negligible because it’s done through tax filings.
Pressed on whether House Democrats will push for a ballot measure to keep the money, Hullinghorst said a number of lawmakers support the move, then pivoted to put the onus on Hickenlooper.
“I think we have a long way to go before we determine the best approach on that,” she said. “But I’m hoping that’s something the governor will take a look at and be a leader on it.”
She added, “I’m hoping he is keeping his options open,” suggesting she wants him to consider reversing his stance on the issue.
Hullinghorst isn’t the first to raise the possibility. State Sen. Pat Steadman, a Denver Democrat, questioned Hickenlooper on his refund proposal when the governor presented his budget proposal to the committee in November, nothing how education funding continues to lag after the recession.
Hickenlooper acknowledged the needs in certain areas of state government, such as transportation and education, but didn’t budge.
“There is a serious resistance to providing more funding to different state agencies unless (the public) can be more fully assured that money will go to a certain, specific purpose that they believe in,” he replied. “That’s essentially the point of TABOR. We have an obligation to make sure that our spending conforms to the expectations and accountability of our citizens.”
The conversation continues. Steadman noted in his recent legislative newsletter that tax breaks “are being proposed as one way around the (TABOR refund) situation.”
“Lots of intricate, moving parts and no shortage of special interests,” he added.
State Sen. Kent Lambert is the chairman of the split-partisan budget committee (three Republicans and three Democrats).
The Colorado Springs Republican supports asking voters to keep the marijuana revenues exceeding TABOR, an additional $30 million, but he is noncommittal on the larger refund issue. To complicate the matter, he recently suggested state lawmakers may consider revamping how the TABOR money is refunded.
Right now, state law directs the TABOR refunds for this amount first toward an earned income tax credit for low-income workers and then toward a tiered sales tax refund shared by the larger population.
“Everything is on the table,” Lambert said.