DENVER — For years Democrats have been ranting and raving about Colorado’s Taxpayer Bill of Rights, which requires voters to approve all tax hikes and keeps state spending from rising beyond a certain level.
On Tuesday, during a Joint Budget Committee briefing on the state’s quarterly revenue forecast, a Republican lawmaker joined them.
“I have to tell you, quite honestly, the more I learn about TABOR, particularly what it did with the floods in our counties, the less and less I like TABOR, and the more insidious I think it has been to state government,” said Rep. Cheri Gerou, R-Evergreen, who sits on the Joint Budget Committee and is in her final year at the legislature.
Last year, local communities found that TABOR limits on spending and revenues prevented them from freeing up funds to help citizens recover from September’s catastrophic floods.
“I’ll have an effigy burned in my front yard when I get home, but it’s the honest to goodness truth,” Gerou said. “It’s not been good.”
The comments came as lawmakers vented their frustration that rising state revenues are likely to lead to either TABOR refunds to all taxpayers or a referred measure this fall asking voters to let the state keep the extra cash, something FOX31 Denver first reported last week.
It’s all the result of the first year of tax revenues coming from recreational marijuana — even though the state projects marijuana tax revenues at $54.7 million, far below the $67 million total estimated in the 2013 Blue Book as voters considered Proposition AA, a combined 25 percent excise and sales tax rate on pot.
“That’s actually within the limits,” said Sen. Pat Steadman, D-Denver, who also sits on the JBC. “The problem is that our state spending is growing otherwise because the state’s economy is growing.”
The 2013 Blue Book estimated not just the revenues that might come from the marijuana taxes but also the impact on total state fiscal year spending, which was anticipated to be $20.15 billion.
So even if tax revenues themselves come in below the projection, taxpayers could still be eligible for TABOR refunds if overall state spending exceeds the Blue Book projection — which is likely based on the new revenue forecast, showing revenues up as much as $93 million in Fiscal Year 2014-15.
“Section 3-C of TABOR holds us to those projections in the Blue Book,” Steadman said, noting that this is only a one-year problem because the Blue Book only listed projections for the first year of the new taxes.
“Basically, it’s impossible to implement a new tax in Colorado when the economy is on an upswing.”
Steadman said that he predicts lawmakers will decide to ask voters this November to allow the state to keep the money that comes in above the 2013 Blue Book spending estimate rather than simply issuing taxpayers rebate checks of around $10.
“I don’t think there’s one voter in the state of Colorado, other than maybe Douglas Bruce, who thought we were going to have to go back to them again to be able to keep the money,” said JBC Chair Crisanta Duran, D-Denver.