2024 Leg Session, Cory Gaines, Exclusives, TABOR, Taxes, Uncategorized

Gaines: Democrats gunning for TABOR refunds with House Bill 1311

State Representative Bob Marshall and I don’t agree on much, but I agree with him that his colleagues in the Colorado legislature don’t like the fact that the Taxpayer’s Bill of Rights (TABOR) requires that they give us our money back.

As we did last year (and as we likely will in coming years), we will have a TABOR surplus this year. This is good news, but careful readers will notice that I did not use the word “refund” after TABOR. That was no accident.

Just as nature abhors a vacuum, politicians abhor giving you back your money. Why do that when they know how to spend it better than you? Depending on the politician, the effort to spend your money might be clothed in varied amounts of sophistication, but in the end, it all amounts to keeping and spending more.

Governor Polis, for example, ever the champion of tax relief in word if not deed, is a master here. He has been promising since 2018 to help save Coloradans money while spending more of it. The scheme works like this: Polis promised to eliminate special-interest tax breaks and then pay down the income tax rate with TABOR surplus money.

Reality has been quite different. A couple of special interest tax breaks were ended, yet more were created. In his own inimitable fashion, Polis then simply redefined his special-interest tax breaks as not being special-interest tax breaks. Presto: savings and tax relief! Surely you’ve noticed how much better he’s made the tax burden in this state.

A TABOR refund heist

If the Polis strategy could be likened to a pickpocket, a recent bill, House Bill 24-1311, titled the “Family Affordability Tax Credit,” is the brute who simply reaches out and takes your money right in front of your face. The sponsors of this effort didn’t bother with any pretense like our governor. They want to straight up take your money and give it to people who they think are more sympathetic.

Under the current system, when there’s a TABOR surplus, the government first diverts surplus money to fill in county treasuries depleted by offering a discount on property taxes to the elderly and disabled veterans. Any remaining surplus then gets returned to the people of Colorado and (except for the last couple of refunds) is returned proportionately: those who pay more in taxes get more money back.

If HB-1311 were to pass, disabled vets and the elderly would still get their property tax discount. However, instead of returning the remaining money directly to taxpayers, the bill would divert the leftover TABOR surplus to people with children under 16 on a sliding scale.

Who could have a problem with giving money to help lift children out of poverty? Let’s put aside legitimate questions about whether yet more money (we already have a Child Tax Credit and Earned Income Tax Credit) will produce better results, and focus on the details. The numbers matter. If you look at the bill’s fiscal note, you’ll quickly see that we’re not talking about feeding poor children by taking from the rich (who, of course, can be continually tapped for money when we want it without any adverse consequences). The money comes from Coloradans all over the spectrum.

My wife and I are both teachers. We live modestly in a tiny house on the Eastern Plains with my young daughter. As joint filers, we would not qualify for much, if any, of the affordability credit. Oh, and we will still have to pay our state income tax.

By contrast, someone with an income low enough to not pay any tax will get the maximum credit. No kids (at least none under 16)? Like me and my family, you still get to pay taxes but won’t see any of your money back.

Whose money is it?

Where we put our money speaks volumes about how we weigh competing needs and interests. What kind of statement does this bill make about you and your family? Plain statistics tell me that it’s more likely than not that you’ll fall into the same bracket as my family and the childless. You will pay in and not get any back. Are some children worth more than others? Is someone who is childless yet struggling to make ends meet less worthy? Perhaps just as important, who gets to participate in the choosing?

Giving individuals their own money back, in proportion to the amount they paid, would result in money being allocated in such a way as to better reflect the varied and diverse values of Coloradans. Maybe you need the money for yourself. Maybe your neighbor feels moved to give more of her money to the needy. Maybe your uncle would want some to make himself more financially stable, but he’d still give part to a food bank. If you have the money, you get to put it where you think it should go. You get to have your money reflect your values and needs.

Alternatively, if the argument is that we as a state could do more than a scattered group of individuals donating to charities, why not involve more people in the decision? In other words, why not make a public case for this and put it to a vote of the people?

I want to end where I began, with Representative Marshall. His full quote (from the 7:06:01 mark of the first committee hearing for HB24-1311) is “To me it shows somewhat of a deep contempt for the voters because of TABOR, of what they put in place in ’92, and we’re trying to find a way around it because we don’t like the fact that we have to give $2 billion back to the taxpayers.”

In keeping with the idea that where money is spent is a statement of how we weigh competing needs, one could easily see this bill exactly as Marshall has it: the politicians running our state think they know better than you. Their ideas, their values, their relative weights on competing needs mean more.

In short, you don’t know how to properly spend the money you worked to earn.

Cory Gaines is a regular contributor to Complete Colorado.  He lives in Sterling on Colorado’s Eastern Plains and also writes at the Colorado Accountability Project substack.


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