Lawmakers send special session bills to Polis
Primary property tax relief measure wins party-line vote after a lengthy debate in the Senate on Sunday
BY MARIANNE GOODLAND email@example.com
The Gazette, Colorado Springs
The Democrats’ proposal to offer relief from soaring property taxes won party-line approval after a lengthy debate in the Senate on Sunday. The measure is headed off to the House. Meanwhile, lawmakers also sent the first two of seven bills expected to win approval to Gov. Jared Polis, who convened the legislature into a special session following the defeat of Proposition HH. The House Transportation, Housing and Local Government Committee reviewed the main property tax measure on Sunday afternoon, including an amendment that will require Senate approval, which is likely to happen on Monday. Senate Bill 1 would exempt $50,000 from residential and multifamily residential properties’ tax liability calculation and reduce the assessment rate on those properties to 6.7%, down from 6.765%. The tax relief would be paid for with $200 million from the general fund, money that lawmakers already set aside in 2022. Of that, $146 million would go to schools, fire districts, ambulances, rural hospitals and emergency services, with the rest divvied up among that state’s counties and other special districts. Counties with less than 15% tax revenue growth over the past two years would be eligible for funding to “backfill” revenue they would lose as a result of the legislation. But the measure is still drawing worries from local governments, which opposed HH, the measure that would redirected Taxpayer’s Bill of Rights refunds to tax relief for homeowners. Voters rejected the proposal, championed by Polis, by nearly 20 points. These conversations are occurring in a vacuum and have introduced great uncertainty, said Kelly Flenniken, executive director of Colorado Counties Inc. She pleaded with lawmakers to partner with local governments for future property tax solutions. That worry applies to House Bill 23B-1003, which would set up what’s likely to be a Democratic-dominated task force to look for long-term property-tax solutions. Out of the 18 members on the task force envisioned in the bill, just two represent counties, one for a population of more than 300,000 and another for counties of less than 300,000, which could still draw from urban counties, such as Broomfield or Pueblo. Both county members would be appointed by the Democratic leaders of the House and Senate who, along with the governor, would appoint 14 of the 18 members. Republicans are already claiming the task force bill will ensure a lack of representation from rural Colorado with only two Republicans lawmakers appointed by the minority party leadership. However, the Senate on Sunday evening shook up the task force membership, after hours of work on an amendment by sponsor Sen. Kyle Mullica, D-thornton. The amendment substantially reduced the number of appointments to be made by the president, speaker and governor, added appointments to be made by the minority party leadership, and allowed appointments to be made by the Colorado Municipal League, the fire chiefs and the Special District Association. While Republicans were generally happy with those changes, they did not support the amendment because of other language in the bill around housing affordability and effects of property taxes on renters. Lawmakers continued to squabble on Sunday over whether Senate Bill 1 includes TABOR refund money. Republicans have maintained that the $200 million that will be used to backfill schools, fire districts and counties comes out of a TABOR refund mechanism attached to legislation from last year, SB 22-238. Rep. Mike Weissman, D-AUrora, a member of the transportation committee and one of the authors of HH, acknowledged that parts of the 2022 bill did use TABOR refund money, but he said the dollars in SB 1 come from the general fund set aside in the 2022 bill and not TABOR surplus money. Scott Wasserman of the Bell Policy Center said the bill offers the best property-tax relief available at the moment. “It’s an attempt at progressive property tax relief” and will help those with lower value homes, he claimed. Under the proposal, an $800,000 home will realize a reduction in property taxes of $1,472. Meanwhile, a $1.2 million home will see a $2,361 reduction in property taxes, he said. But this should also be the last time the state meddles in property taxes, Wasserman told the House transportation committee. That’s because lowering value exemptions could hurt rural communities, but if the state only lowers assessment rates, those in wealthy counties, such as Pitkin and Douglas, would be just fine, he argued. The state has blunt tools, and “we desperately need better tools or get out of this game entirely,” Wasserman said. The committee approved an amendment striking an earlier one from the Senate that addresses the potential for a lawsuit over the use of last year’s SB 238 funds. That’s not the $200 million earmarked for property tax relief in the main special session bill, SB 1, which comes from general fund dollars. That lawsuit potential is related to $240 million that has already been spent and which came out of the TABOR surplus last year. The Senate amendment attempted to freeze or even take back the funds sent to local governments, particularly fire districts, should a successful lawsuit be filed. Such a lawsuit has already been hinted at by the Advance Colorado Institute. However, Kennedy said that resulted in “consternation” from local governments that they could get tied up in such a lawsuit, and the House committee stripped it out. SB 1 won approval on a party-line vote from both the House transportation and appropriations committees. It now awaits debate in the full chamber, and is headed for a final vote on Monday, which is likely to be the final day of the special session. The Senate also made quick work of two House bills that are now headed to the governor. House Bill 23B-1008 expands a loan program for property taxes offered by the Treasury Department. It won a primary party-line 20-14 vote in the Senate on Sunday, receiving “no” votes from Sens. Dylan Roberts, D-eagle, and Rachel Zenzinger, D-arvada. House Bill 23B-1002 would double the Earned Income Tax Credit for low- to moderate-income individuals and families from 25% to 50%. It won a 20-13 vote, with Sen. Joann Ginal, D-fort Collins, voting against it with the chamber’s Republicans. The Senate also wrapped up second reading debate on House Bill 23B-1001, the emergency rental assistance program, which heads to a final vote on Monday. That bill provides an additional $30 million for rental assistance through the Department of Local Affairs, which can cover rent, late fees, and other fees tied to evictions.