Battling property tax bills could be settled at ballot

and then decide later which one to pursue.

BY JESSE PAUL THE COLORADO SUN

e Colorado legislature’s inaction so far this year on a long-term x e ort to address rising property tax bills has prompted two scal policy nonprofits — one conservative and the other liberal — to propose competing ballot measures that would dramatically reshape the state’s nancial picture. e policy battle is a repeat of what happened at the Colorado Capitol last year, when the same groups, neither of which have to disclose their donors, initiated property tax ballot measures when the General Assembly was slow to act. ey backed down only when lawmakers passed a Band-Aid bill giving property owners two years of temporary tax relief.

Property tax revenue funds schools and local governments, meaning that any discussion about how they should change carries extremely high stakes. e stakes have only increased since Colorado voters in 2020 repealed the Gallagher Amendment, which prevented residential property tax bills from getting too big but, when combined with the Taxpayer’s Bill of Rights, strangled local government budgets. Rising property values across Colorado after the COVID-19 pandemic began have caused property tax bills to jump, too. Coloradans will get new property assessments from their counties starting May 1.

Colorado’s property taxes are among the nation’s lowest. But a big increase in property tax bills will really a ect people with xed incomes, such as retirees, who bought their homes when they were worth much less and weren’t expecting such a large nancial burden.

Gov. Jared Polis and Democrats, who control the Capitol, say they are committed to coming up with a long-term x this year. But the legislative session is more than halfway over — the General Assembly adjourns May 8 — and no proposals have been made public.

e governor and lawmakers have committed to expanding an existing property tax relief plan in the 2023 and 2024 tax years to $900 million, $200 million more than what was approved during the 2022 legislative session in a deal that got the nonpro ts to abandon their ballot measures.

“Conversations are obviously ongoing,” Senate President Steve Fenberg, D-Boulder, told reporters. “I know there’s conversations happening with advocates, with connected districts, with businesses etc.”

In the absence of state lawmakers doing something, however, independent groups have stepped in to try to ll the vacuum — and also pressure the General Assembly to get moving. Advance Colorado, the conservative scal nonpro t, entered the property tax conversation rst this year with Initiative 21, which would be on the November statewide ballot. It would amend the state constitution to cap property tax increases at 3% per property and set aside up to $100 million in state TABOR surplus each year for re districts.

TABOR caps government growth and spending each year based on population increases and the rate of in ation. Any money collected above the cap must be refunded to taxpayers unless voters say otherwise.

Michael Fields, who leads Advance Colorado, said the measure is an insurance policy against legislative inaction this year. “I think we’re wanting to see what the legislature comes up with,”

Fields said. “But given that we can’t go back in time, we wanted to get it led and get it through the process.” e Bell Policy Center, the liberalleaning scal nonpro t, responded last week by ling eight proposed 2023 ballot measures for review by the state’s Title Board. If they are approved, Bell Policy Center can begin collecting signatures to have them placed on the fall ballot. e measures, submitted in partnership with the Colorado Education Association, the state’s largest teacher union, would reduce or cap property tax increases and/or use TABOR surplus to replace the revenue lost by school, re district and local water project budgets.

Scott Wasserman, who leads the Bell Policy Center, says the measures are intended to neutralize Initiative 21 from Advance Colorado and also serve as a hedge against legislative inaction on property tax policy this year.

“It is clear from the initiatives already led by those who seek to destroy Colorado’s revenue base that these interests want to undercut the legislature’s ability to address the uneven e ects of a property tax spike,” the Bell Policy Center and Colorado Education Association said in a joint statement. “ e measures we’ve led would restrict the damage of possible statewide reductions or limitations, and ensure communities are adequately funded, while also protecting property taxpayers at this time of increasing property values. In the event the legislature is unable to reach a solution this year, we fully intend to move them forward and supersede any other initiative.”

Here’s the gist of what the Bell Policy Center/Colorado Education Association measures would do, in some combination:

Direct TABOR surplus — forecast to be more than $2.5 billion in the current scal year ending June 30 — to education, local re districts and water projects to make up for any money lost from property tax assessment rate reductions or caps on Coloradans’ increasing property tax bills. e measures wouldn’t a ect TABOR surplus until the 2023-24 scal year, which begins July 1.

Cap commercial and residential property tax increases at 3% annually, unless a property is valued at more than $2 million or $3 million, depending on the version of the ballot measure. Two of the initiatives would instead limit property tax increases by lowering property assessment rates.

Groups often le several iterations of the same or similar ballot measures

Some of the Bell Policy Center/Colorado Education Association proposals would change statute and others that would amend the state constitution. Wasserman estimates the changes would reduce property tax revenue by about $800 million. If state economic and tax forecasts are correct, there should be enough TABOR surplus in coming years to replace the de cit.

In reality, it will be very di cult for either Advance Colorado or the Bell Policy Center to get a property tax measure on the November ballot.

It takes time and a lot of money — potentially millions — to go through the Title Board process and then collect the 125,000 voter signatures required to get an initiative on the statewide ballot.

It’s even harder to get a constitutional amendment on the statewide ballot. at comes with the additional requirement that the voter signatures gathered include at least 2% of the registered voters in each of Colorado’s 35 state Senate districts.

Advance Colorado has deep pockets — again, it doesn’t disclose its donors — and Fields has a proven track record of getting scal policy questions on the ballot.

Bell Policy Center, by comparison, is backed by some wealthy foundations, including Gary Community Ventures, a philanthropic group focused on policy change that helps children and families. But the Bell Policy Center hasn’t really spent the kind of money that Advance Colorado and its associated political nonpro ts have dedicated to ballot measures in recent election cycles.

Fields cast doubt on the Bell Policy Center’s ability to follow through.

“I would encourage Scott and his donors to do some polling on how popular TABOR refunds are with Coloradans. Last time, they couldn’t even get enough signatures to get their tax hike (Initiative 271 in 2020) on the ballot, so it’s hard to believe these are actually serious proposals.” is story is from e Colorado Sun, a journalist-owned news outlet based in Denver and covering the state. For more, and to support e Colorado Sun, visit coloradosun.com. e Colorado Sun is a partner in the Colorado News Conservancy, owner of Colorado Community Media.

Wasserman pointed out that Initiative 12 — which would have tied income tax rates to the amount of money people make, charging higher earners more — was a proposed constitutional amendment and that signature gathering for the measure was launched during the pandemic. He said his proposals this year are 100% serious.

“We always are serious when we le measures at the Title Board,” he said.

“You can’t just cut local revenue without a back ll for the loss.” ere are also questions about the viability of the proposals from both the Bell Policy Center and Advance Colorado. Properties often fall into multiple taxation districts with di erent mill levy rates, which determine how much people owe the government.

It would likely be tough for local governments to work together and determine how to cap a property owner’s tax bill.