The property tax reform bill at the center of state officials’ deal with conservative activists to pull back a pair of ballot initiatives advanced on schedule Tuesday, clearing a key hearing before the full Colorado House of Representatives.
The measure now needs a final House vote on Wednesday. Should it clear that, it will then face a marathon of votes in the Senate as lawmakers aim to end the special session before Labor Day.
House Bill 1001 builds upon years of tweaks to property tax policy in the state following voters’ repeal of the residential tax-stabilizing Gallagher Amendment in 2020. If it becomes law, fiscal analysts say it will cut statewide property tax collections by about $254 million, on top of the $1.3 billion cut approved by lawmakers last spring.
For most property owners, the new reductions would cut less than $100 from their tax bills, though the amount depends on local mill levies and the property’s value, among other changes to tax policy.
The true stakes, however, lie in a pair of ballot initiatives that, if passed by voters in November, would force even deeper cuts to property tax collections. The conservative proponents of initiatives 50 and 108, led by Advance Colorado, have repeatedly declared that they will yank the measures — characterized by opponents as “catastrophic” and “draconian” — if the bill becomes law.
So far, it has gone through relatively minor changes as lawmakers seek to protect the terms of the deal, even as the terms continue to rankle many legislators. Those who are critical feel they’ve been called to rubber-stamp a preordained outcome.
State Rep. Cathy Kipp, a Fort Collins Democrat who said she hasn’t made up her mind on the bill, characterized it as picking between cutting revenues for local services now or being forced to consider much heavier cuts if the ballot initiatives pass.
“This a really hard position for us legislators to be in,” Kipp said. “Do we take a little bit of harm now — or risk a lot of harm later?”
The bill had faced stiff opposition from fire districts, and Democratic lawmakers lined up to voice support for firefighters Tuesday. The property tax-funded fire departments have struggled to keep up with rising costs, and further cuts would hurt service, a slew of chiefs testified Monday.
Garry Briese, executive director of the Colorado State Fire Chiefs, said Tuesday afternoon that they were close to reaching a deal with legislative leaders to prioritize sustainable funding for the fire districts in some way in the future. That would be short of the chiefs’ hopes for a carve-out from funding cuts altogether, but it would get them closer to their long-term goals, he said.
“We’re now involved in developing these solutions, instead of reacting to imposed solutions,” Briese said.
Others challenges linger. Some House Democrats reiterated their frustrations Tuesday the state hadn’t done enough to insulate tenants from rent increases and that the deal didn’t target relief to lower-income property owners.
The House also passed a proposed ballot measure Tuesday that, if approved later by the state’s voters, would require local voter approval of any future statewide property tax changes passed through ballot measures.
Democrats have supported it as a way to undercut the potential for future property tax wars, but Republicans have sharply opposed the bill, suggesting it would blow up the deal now on the table. The measure would need one Senate Republican to back it to reach the supermajority threshold for a ballot referral, giving it difficult odds to passage.
Tuesday’s passage of the main tax relief measure sets up a final, recorded vote Wednesday that will give a full picture of Democratic and Republican support, which was clouded somewhat by Tuesday’s procedural tallies that included voice and bundled votes.
Bills rarely die if they reach the final floor vote, and even progressive skeptics of the deal said the measure was likely to clear the chamber Wednesday. Rep. Matt Soper, a Delta Republican, said he supported Advance Colorado’s ballot initiatives, but he’s decided to back the property tax deal.
Still, several Democratic legislators said they remained undecided, even as they acknowledged the risk of the ballot measures passing. And Rep. Scott Bottoms, a Colorado Springs Republican, said he welcomed anything that would blow up the deal and keep the measures on the ballot.
Asked about the bill’s chances of passing the House, Speaker Julie McCluskie said late Tuesday afternoon that she was confident.
Should that happen, the bill will then move to the Senate. If lawmakers want to finish the special session by Thursday at the earliest, the bill will need to first pass a Senate committee and then an initial vote before the full Senate by the end of Wednesday.
That would set up a final vote — and, potentially, final negotiations with the House — for Thursday.
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