2021 Leg Session, Constitutional Law, Education, Exclusives, Legal, TABOR, Taxes, Uncategorized

DeMelis: School district property tax hike must go to the ballot

It’s the time of year when Colorado politicians lament the state school finances without proposing any sort of meaningful change to the system that funds said schools. Instead, a proposed bill—which seeks to phase in higher local property tax rates over the next 19 years—is yet another example of the state government seeking to impose its will on the people. Not only is the constitutionality of the bill a dubious proposition, to pass this bill would mean denying taxpayers the self-determination enshrined by Colorado law.

Proponents of House Bill 21-1164 say that it rectifies a decades-old mistake. In 1994, voters had, in essence, agreed to hold local property tax rates steady (this was accomplished by waiving the cap on revenue that could be earned from property taxes).  Despite this waiver vote, the Colorado Department of Education advised school districts to calculate the mill levy (tax rate when applied to property, 1 mill equals $1,000 of assessed value) according to section 7c of the Taxpayer’s Bill of Rights (TABOR).  TABOR is a state constitutional amendment that requires, among other things, voter approval to increase taxes.  Further, the School Finance Act (passed in 1994) requires the state to subsidize school program funding, at the maximum rate up to a specified limit. In order to obtain the maximum state funding and to fulfill the calculations required by 7c, districts continued to lower the mill levies. It was not until 2006 that an amendment was added to TABOR that clarified that the calculations required by 7c were expressly overwritten if a waiver vote had been conducted.

Instead of listening to the will of the voters, the Department of Education lowered rates, based on interpretations of TABOR that have since been clarified and shown to be incorrect. HB 1164, in the eyes of its supporters, therefore rectifies a mistake. To pass this bill would mean that the state government would once again be making the same mistake that it made years ago; it would circumvent the will of the people.

The language of TABOR is very clear, stating in subsection 4a that “any new tax, tax rate increase, mill levy above that for the prior year,” requires “prior voter approval,” save two special cases which do not apply to the pending bill (CO Const. art. X, §20). The intent here is clear—the Coloradans who will be facing the increase in taxes have a direct say in any potential increase in taxes. And it is this intent that is quite obviously ignored by the education funding bill in question.

HB 1164 asserts that “the reductions in district mill levies for property tax years 1994 through 2006 were not authorized by statute and are void for purposes of determining a district’s correct mill levy,” and since the previous reductions are now considered “void,” the district is now no longer required to conduct any action “other than to certify the mill levy.” 

It has been 27 years since the first misinterpreted mill levy decreases occurred. In this time, the makeup of those individuals paying taxes has changed. Those who could not vote for these tax proposals 27 years ago can vote now. Indeed, even some who had not yet been born are now tax-paying Coloradans. And as such, they are entitled to protections under TABOR. To deny this current crop of taxpayers a vote not only violates the spirit (and letter) of TABOR, it also proves that the government still has not learned from its mistakes.

Supporters of the bill have cited some legal precedent pertaining to the constitutionality of the proposed levy changes that they hope will support their cause. The case Mesa County Board of County Commissioners v. State of Colorado outlines particular provisions for when a vote is or is not necessary at the district level. And while this argument certainly holds merit, the constitutionality of the bill still seems very much up in the air—especially given the notion propagated by the bill that the prior vote invalidates the requirement for a current vote (a position not explicitly supported by the

The proponents of the bill are correct in asserting that we should recognize that several decades ago, voters agreed to maintain a higher degree of taxation than the status quo. However, those government officials are taking the wrong meaning from this argument. It is not the voters that lowered rates, it was the actions of the Colorado Department of Education that led to the reduction in property tax rates among districts. Yet they want to deny Coloradans the right to vote on the rectification of a government-created mistake? Just because the government wants more money, does not mean it can flagrantly disregard the will of the people.

Nathaniel DeMelis is part of the Future Leaders program at the Independence Institute, a free market think tank in Denver, and a junior at Tulane University studying English and Political Economy.

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