Colorado governor now ‘undecided’ about supporting $1 billion tax hike

Greg Campbell | Contributor

Colorado Gov. John Hickenlooper is waffling on whether to support a proposed $1 billion tax increase to overhaul how the state funds its schools.

Thanks to a state constitutional provision called the Taxpayer Bill of Rights (TABOR), voters must approve all new taxes.

Exactly how the ballot proposal will be worded and how the taxes will be raised is still being decided, but Hickenlooper originally said he would support whatever was proposed.

“I will certainly campaign for it when we decide what it is,” he said while signing the bill authorizing the changes in May.

The EdNews Colorado website also quoted the tax’s supporters saying how critical Hickenlooper’s commitment was to passing the tax.

“The only [successful] path I see right now is the governor supporting and actively campaigning,” the site quotes one unidentified observer as saying.

But Hickenlooper hedged on that support recently, telling the Denver Post that he’s now undecided about whether to support the measure.

“[It’s] crazy to put more money into the system unless you change the structure of the system,” he said, but added, “I think it’s likely that we will support something.”

The state estimates that there is a $4 billion shortfall in funding public education in Colorado and its aging facilities need about $18 billion worth of repairs and upgrades. A long-running lawsuit by several school districts argued that education dollars aren’t equitably distributed throughout the state and that the formula for spending was unconstitutional.

The case went all the way to the state Supreme Court earlier this year, which ruled against the plaintiffs, meaning the last chance to inject funds into the system rests with voters.

Supporters are currently trying to come up with the most palatable way of presenting the idea to voters, who will also be asked to pass new taxes for legal recreational marijuana.

One idea is to simply raise Colorado’s flat tax rate across the board. But generating the money required by the bill would mean increasing the flat tax from 4.63 percent to 5.35 percent, making it the highest flat tax rate in the United States.

“Even Taxachusetts levies only 5.25 percent, at least on wages and salaries,” wrote former Rocky Mountain News columnist Peter Blake on the Complete Colorado website. “According to the National Conference of State Legislatures, the only other flat-tax states are Illinois (5 percent) Indiana (3.4 percent), Michigan (4.25 percent) Pennsylvania (3.07 percent) and Utah (5 percent).”

But a tiered increase also has hurdles. Blake writes that the proposal that seems to have the most traction is one that would increase the tax on incomes under $75,000 to 5 percent and on incomes over $75,000 to 5.9 percent. Convincing the business community to support such a plan when most of its members would probably qualify for the higher tax rate will likely prove difficult, he writes.

Hickenlooper’s “maybe, maybe not” approach to supporting the new tax is reminiscent of his back and forth consideration of whether to grant clemency for convicted mass murderer and death row inmate Nathan Dunlap, who was set to be executed in August. Hickenlooper polled everyone from victims’ families to clergy to leaders in Israel during an overseas trip in weighing in the decision.

In the end, he decided to grant an indefinite temporary stay of execution, which seemed to satisfy no one.

Tax proponents have until Aug. 5 to collect 86,105 signatures to put the measure on the ballot.

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