Starting Jan. 1, the Regional Transportation District (RTD) can begin collecting sales tax on cigarettes, candy and soft drinks, just like the state does.
So can the Scientific and Cultural Facilities District (SCFD), which is virtually identical in geographic size but has only one-tenth RTD’s taxing power.
You don’t remember voting on this particular new tax? In fact, you didn’t. But no matter. Wicked citizens who smoke cigarettes, drink pop and eat candy were born to be taxed and don’t even deserve the protections of theTABOR Amendment, right?
House Bill 1272, recently signed into law, also entitled the two taxing districts to collect their 1 and 0.1 percent tax on direct-mail advertising materials and food containers.
To be sure, they’ll have to give up their current taxes on “low-emitting motor vehicles,” machinery, machine tools and vending machine sales of food that isn’t candy or pop. But overall the changes are estimated to produce a net gain of $2.7 million a year for RTD and $270,000 for the SCFD. If it weren’t for the net gain, it’s unlikely the bill would have been introduced.
It’s ostensibly part of an effort to coordinate the state sales tax with the regional taxes. To make it work, the legislature also had to pass House Bill 1144, which made permanent the temporary sales tax on cigarettes that was due to expire July 1.
The legislature, not satisfied with the excise tax it had long imposed on cigarettes (4.2 cents per coffin nail, or 84 cents a pack), voted in 2009 to throw on the 2.9 percent state sales tax as well, on a “temporary” basis. That comes to an average of about 14 cents a pack.
HB 1144 was originally written to allow RTD and SCFD to start their new taxes on July 1 as well, but the paperwork required forced delay until Jan. 1.
If it’s any comfort, cities and counties aren’t yet allowed to impose their own taxes on cigarettes, since, unlike RTD and SCFD, they share in the state’s excise tax revenues.
The legislators did at least discuss the TABOR issue before approving HB 1272, which passed on a party line vote. They were told that no voter approval of the additional taxes would be needed because the additional revenue brought in by the tax wouldn’t cause the two metro districts to exceed their year-to-year spending limits.
This conclusion is based not on TABOR itself but on the Colorado Supreme Court’s interpretation of TABOR, which isn’t the same thing.
TABOR specifies that any “tax policy change directly causing a net tax revenue gain to any district” must be approved by a popular vote. That would seem to require a popular vote in the RTD and SCFD before the new taxes could take effect.
But another section of TABOR specifies that each taxing district’s annual spending increase must be limited by the rate of inflation plus population growth. Unless citizens vote to allow them to keep the surplus, it must be refunded.
The Colorado Supreme Court, in the Mesa County vs. State of Colorado case of 2009, managed to merge these two separate provisions in order to uphold a state law permitting school districts to keep an extra $117 million that under the original interpretation of TABOR would either have had to be voted on or be refunded to taxpayers. Because voters in most school districts had earlier permitted the districts to keep surpluses, and the extra money didn’t violate the spending limits, the court said the new law could stand.
Will there be any effort to stop the new taxes brought on by HB 1272? Certainly not. First, no one is going to rush to defend the rights of those hooked on nicotine and sugar highs. Second, the amount involved is fairly small and there are bigger issues to fight.
And third, there is no appetite among conservatives to give the current state Supreme Court another chance to nibble away at TABOR, which the majority has long despised. Who knows, the court might figure out a way to make a vote on this fall’s proposed $1 billion tax hike benefiting K-12 schools ( or at least their teachers’ troubled retirement fund) unnecessary.
Whether TABOR’s prospects will improve upon the mandatory retirement next January of Chief Justice Michael Bender — he’ll hit the constitutional age limit of 72 — is debatable.
That’s because his replacement is likely to be of the same stripe. Gov. John Hickenlooper has made it increasingly clear in recent days — with bill signatures and stays of executions — that he has thrown in his lot with the progressives, either for re-election purposes and/or for a possible presidential campaign.
So rejoice that the RTD can use its extra $2.7 million a year to keep building promised light rail lines, even though the new West line proved to be less popular than the bus routes commuters had used before.
Longtime Rocky Mountain News political columnist Peter Blake now writes Thursdays for CompleteColorado.com. Contact him at email@example.com You may re-publish his work at no charge and without further permission; please give full credit to Peter Blake and www.CompleteColorado.com