Colorado’s Republican lawmakers said Wednesday that they were “pushing their way into the conversation” on property taxes — just as voters are weighing in on Proposition HH — by demanding a special session to pass several relief measures.
Senate Minority Leader Paul Lundeen of Monument made the declaration at a news conference as Republicans, whose political power is at a historic ebb in state government, argued against the multi-faceted ballot measure spearheaded by state Democrats. If voters reject Prop. HH in the Nov. 7 election, as the Republican lawmakers hope, Democratic leaders, including Gov. Jared Polis, have no clear backup plan.
That would leave little time before homeowners are hit in the spring by major property tax increases caused by rising property valuations, averaging 40% at the median.
“We have to have relief this year — this calendar year — so they can get the property tax relief next year,” said Sen. Barbara Kirkmeyer, a Brighton Republican, arguing the failure of HH would leave homeowners “in a lurch.”
Proposition HH is the biggest measure on the statewide ballot as elected leaders seek to scale back, but not eliminate, the coming property tax increases. While the Republicans proposed some relief measures that overlap with what’s in the ballot measure, they say Polis should call a special session now to ensure those would be in place in time.
This isn’t the first call for a special session from GOP legislators, who hold a super-minority of seats in the state House of Representatives and a near super-minority in the state Senate. They have no power to force one.
The governor, through a spokesperson, did not comment on calling a special session if HH fails.
The ballot question, if approved by voters, would reduce the amount of a home’s value that is taxed while also decreasing the percentage rate used to determine property taxes that are owed. It would also increase the amount of tax revenue the state can retain under the Taxpayer’s Bill of Rights by 1 percentage point per year above what’s allowed now.
That money — expected to reach $2.2 billion a year within a decade — would help local governments offset lost property tax revenue and provide some assistance for renters; the lion’s share, though, would significantly boost annual education funding, which has been shortchanged in Colorado for years. The spending would come at the cost of continually reduced TABOR-mandated refunds for taxpayers for years to come.
Democrats argue Prop. HH is the best way to tamp down on spiking property taxes without hamstringing local governments. Republicans argue it’s a runaround on TABOR and say the impact of cutting property taxes can be dulled using existing revenues.
The Republican proposal unveiled Wednesday is three-pronged: Make the senior homestead exemption portable and increase the exempted amount to 50% of the home’s value, up to $200,000; lower the assessment rate while reducing the home valuation that’s taxed; and lower the state’s income tax rate from 4.4% to 4%.
The first two proposals are included in Proposition HH, with varying details, while the income tax cut is a recurring aim of state Republicans, frequently with backing from Polis. The GOP proposals would be paid for using tax collections that exceed the TABOR limit, said Kirkmeyer, a vocal opponent of Prop. HH.
The next regular session begins in January, and Democratic leaders have said that if HH fails, a special session couldn’t be arranged quickly enough after the election to find a solution before property taxes are finalized in December. They also may lack the political will to cut property tax rates without providing specific funding to compensate local governments for lost revenue.
Senate President Steve Fenberg in a statement Wednesday called demands for a special session less than two weeks prior to Election Day “a distraction and a political stunt,” while defending HH as the best way to soften property tax increases without forcing cuts to local budgets.
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