State lawmakers are working on a draft bill that would bring them back to Denver for a special session with the goal of keeping at least some of the money expected to go out to Coloradans as TABOR tax refunds next year.
“To do this you sometimes need to put words to paper,” House Speaker KC Becker, D-Boulder, said in confirming the draft’s existence. “We will see if something can come of it.”
What could come of it is still up in the air. Becker and others said the bill isn’t a final version nor is a special session imminent, but rather it is the start of negotiations.
“The governor has been engaged in listening to Democrats and Republicans to better understand their fiscal priorities, and there have been many fruitful conversations,” spokesman Conor Cahill said.
Statehouse Democrats and Gov. Jared Polis want to keep about $300 million to $575 million that state economists expect Colorado to have to return to taxpayers in 2020 because it exceeds the amount of revenue that can be collected under the Taxpayer Bill of Rights, or TABOR. The constitutional amendment limits how much governments in Colorado can collect and requires them to return everything above that cap.
The way Democrats could keep that money is to come back for a special session and amend Proposition CC — the November ballot issue lawmakers approved earlier this year — to include the 2018-19 budget year. The ballot question asks voters to permanently eliminate the TABOR cap, or de-Bruce,” and basically let the state spend the extra money on education and transportation.
The Colorado Department of Transportation estimates it needs $9 billion more than it has for deferred maintenance and new projects, and state spending on public education has long trailed the national average. In January, Education Week’s annual state-by-state assessment of public education gave the Centennial State a D+ for school finance and a C for overall K-12 achievement.
When the supporters of Prop CC first announced their proposal in March, state economists thought Colorado might not hit the TABOR cap at all in the next few years. That thinking changed in the June forecast, when they predicted TABOR tax refunds totaling as much as $1.3 billion over the next three years.
And those new dollars opened to the door to the idea of a special session.
“I’m in favor of looking at all alternatives to address the issue,” Sen. Dominick Moreno, D-Commerce City, said after receiving the revenue forecast briefing in June. “The reality is to issue TABOR refunds at the same time we’re not fully funding transportation or education or a variety of other government services is something I think the legislature should address.”
Republicans have long supported increased funding for roads and bridges. However, many of them aren’t so keen on the idea of coming back into session to modify a ballot initiative they didn’t support in the first place. Every House Republican signed onto a letter sent to Polis rejecting calls for a special session.
“We have a constitutional duty to return money to the taxpayers when we exceed the revenue caps, and we must fulfill that obligation,” House Minority Leader Patrick Neville said in a statement. “Any effort to undermine or take away the refunds of our citizens will be strongly opposed by the House Republicans.”
Democrats have the majority in each chamber and could pass these changes without a single Republican vote, but several Republicans in the Senate, where the margin is much narrower, told The Post that Polis has reached out in the last couple of days to see what it would take to get them on board.
“There’s room for bipartisanship here,” Sen. Jack Tate, R-Centennial, said.
One proposal being floated is to change Proposition CC from a permanent elimination of the TABOR tax refunds to one that lasts 10 or 15 years. Another idea, which Tate is strongly pushing for, is to couple a TABOR timeout with an income tax rate cut that effectively returns some of the money back to Coloradans.
“Tax cuts in general are good for job creation and the economy,” Tate said. “I’m working to make sure that the size of any reduction makes sense for the Colorado taxpayer in the context of other proposals.”
Both Tate and Becker said they are unsure whether the two sides can come together on a bill in the time they have left, though. The Secretary of State’s Office finalizes the November ballot on Sept. 9, and any changes must be submitted by then.