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Proposition HH would mean a 23 percent decrease in TABOR refunds

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Joe Mueller

(The Center Square) – Coloradans can expect approximately a 23 percent decrease in their Taxpayer's Bill of Rights refunds in 2025 if voters approve a November ballot initiative proposing property tax reductions.

A preliminary 16-page analysis by the nonpartisan Colorado Legislative Council Staff was published after Governor Jared Polis and other legislators announced Senate Bill 23-303 on Monday. 

The bill if passed would refer Proposition HH to voters, who would decide whether to reduce residential property tax assessment rates from 7.15 percent to 6.7 percent in 2023 and 2024 and continue reductions in the future. Passing the measure would also mean Coloradans would see TABOR reductions in tax years 2023, 2024 and 2025.

“Due to time constraints, this analysis is preliminary and will be updated following further review and if any additional information is received,” the fiscal note states.

If voters approve Proposition HH in November, local government property tax revenue would be limited along with the reduced property assessment rates. The initiative would reduce TABOR refunds, increase state expenditures, make transfers and allow the state to retain a portion of excess state revenue. It also would reduce local net property tax revenue and increase local expenditures.

The fiscal note provided the impact on the six tiers of TABOR refunds, ranked by adjusted gross income from up to $50,000 to $279,001 and up for those filing single and joint tax returns.

The estimated reduction in TABOR refund payments for those filing a joint return with an adjusted gross income of $50,000 to $100,000 are:

  • tax year 2023, a decrease from $1,278 to $1,212, or $66 (5 percent);
  • tax year 2024, a decrease from $938 to $854, or $84 (9 percent);
  • tax year 2025, a decrease from $784 to $606 or $178 (23 percent).

The table also increased the adjusted gross income for 2024 and 2025 approximately 3 percent in each year.

“There’s an awful lot of pearl clutching happening here,” Scott Wasserman, president of the Bell Policy Center, stated in a social media post. “We are talking about a fraction of the TABOR surplus to pay for the hole that lowering property tax bills creates at the local level. Just look at these projected refunds!”

The Bell Policy Center issued a statement embracing the concept of reducing property taxes and simultaneously providing state revenue to local governments adversely affected by the reduction.

“It targets relief to those residential property owners who need it most by emphasizing value subtraction over assessment rate reductions,” the statement said. “It provides backfilled dollars to schools and other local districts that might otherwise have to cut services.”

Ben Murrey, director of the fiscal policy center at the Independence Institute, was critical of the Bell Policy Center’s position and the legislation.

“Ask yourself, have you ever known the progressive Bell Policy Center to endorse any measure that put MORE money in taxpayers' pockets?” Murrey posted on social media. “I can't think of a single instance. That should tell you all you need to know about Polis's boondoggle of a property tax plan.”