Statewide tax measures widely opposed

Three tax-slashing ballot measures awaiting voters’ decision on Nov. 2 are worrying local governments, chambers of commerce and other organizations who say if one or all are passed, it would be devastating for Northern Colorado’s quality of life.

But proponents of the measures – Proposition 101 and Amendments 60 and 61 – say the measures would offer no more than moderate relief to taxpayers.

SPONSORED CONTENT

How dispatchable resources enable the clean energy transition

Platte River must prepare for the retirement of 431 megawatts (MW) of dispatchable, coal-fired generation by the end of the decade and address more frequent extreme weather events that can bring dark calms (periods when there is no sun or wind).

And in a year when voter dissatisfaction with government is running high, that could mean a surprise or two at the ballot box.

Dan Hopkins, spokesman for Coloradans for Responsible Reform, a statewide group that opposes the measures, said he believes the measures will be defeated but notes the opposition “picked the perfect year” to appeal to taxpayer frustration.

“I think as people study these, they see they are extreme proposals and they will have serious consequences for business, government, education – really everyone in the state,” Hopkins said. “I think people are learning.”

Natalie Merten of CO Tax Reforms – proponents of the measures – would not answer questions from the Business Report over the telephone. But in response to e-mailed questions, she wrote saying the measures would provide moderate tax relief of less than 2 percent annually – about $1 billion – and would be “phased in gradually over decades.”

“How more moderate can one get?” Merten’s e-mail stated. “Their tax hikes are always 100 percent up front, without phase-ins.”

Severe impacts foreseen

The city of Greeley passed a resolution Sept. 7 urging voters to “protect the fiscal health of local government” by defeating the ballot proposals. Tim Nash, city finance director, estimated the revenue loss to the general fund at $5.5 million in 2011, increasing to $6.8 million by 2014.

Roy Otto, Greeley’s city manager, said it’s impossible to gauge the full impact of the measures but that it would likely be severe.

“I can tell you it would have significant ramifications in how we provide services to the people in all segments of the organization,” Otto said.

The city of Loveland is estimating a conservative loss of more than $12 million to its general fund should all three measures pass. John Hartman, the city’s budget officer, said the measures include language that would need interpretation, but the city could conceivably lose about $4 million from its stormwater enterprise fund.

“We’d be looking at pretty significant increases in our water and electric rates,” Hartman said, estimating increases of up to 12 percent for all of the city’s enterprise funds.

Hartman said the potential impact is a moving target until voters cast their ballots.

“Who knows the combination of what will pass and what won’t pass,” he said. “It makes it very difficult for us to plan for.”

But some things are known, he said. “It’s 20 percent of our general fund. It would significantly reduce how most of our city services are done and eliminate some of our services. We would be looking at somewhere around 70 (full-time equivalent) positions being laid off.”

Hartman said that would cut back custodial care in city buildings and code enforcement, lengthen the time it takes for development review, and reduce library hours and park maintenance as well as the number of police on the streets.

For the city of Fort Collins, already facing a general fund shortfall of $4.5 million in 2011 and $5.4 million in 2012 – and seeking a sales tax increase with ballot proposal 2B – the three measures would make the city’s budget even more difficult.

In a resolution passed by the Fort Collins city council on Sept. 21, the city estimates Proposition 101 would result in a revenue loss of about $11.9 million by 2014. Amendment 60, which limits property taxes, would reduce city revenue by $2.5 million in 2011 and likely result in rate increases for city utility services. And Amendment 61, which limits government borrowing, would “dramatically impair the city’s ability to finance long-term capital improvements like road and bridge projects” and other facilities, according to the resolution.

Nonpartisan opposition

Weld County is the only major Northern Colorado governmental body not adopting a resolution in opposition to the measures, but Commissioner Barbara Kirkmeyer said all five commissioners personally oppose them.

“We decided we’re not going to pass a resolution because we don’t want to give anyone the opportunity to criticize us for using taxpayer dollars to oppose a citizen-driven initiative,” she said. “But as board members, we are opposed to 101, 60 and 61, and we’ve all been going out to talk to groups in opposition to it.”

Kirkmeyer said the sentiment against is “absolutely nonpartisan.”

“We can certainly understand people’s attitudes about raising taxes,” she said. “But these aren’t anti-government measures. They are no-government measures.”

Kirkmeyer notes that people angry about government spending are likely upset with the federal government but the measures target local governments already struggling to provide services to residents.

Statewide, passage of the measures could have a profound impact on Colorado’s credit rating. Fitch Ratings noted that “taken together, Fitch believes that Proposition 101, Amendment 60 and Amendment 61 will dramatically limit the flexibility of governments in meeting their future operating and capital demands.”

The e-mail from CO Tax Reforms’ Merten disputes the prediction that the measures will cause the loss of more than 70,000 jobs statewide, saying “tax relief always creates jobs,” adding that “tax relief will get us out of the recession faster.”

CO Tax Reforms had raised less than $18,000 as of Oct. 17 compared to more than $6.7 million for Coloradans for Responsible Reform. That doesn’t matter to Merten.

“They have raised over 300 times what we have,” she said in her e-mail response. “They have money. We have the people. They have to throttle people’s natural instinct that taxes are too high and government wastes too much money.”

Coloradans for Responsible Reform’s Hopkins said proponents have a point. “They don’t have much, but they don’t need much. The way they wrote (the ballot measures), they’re deceptively attractive.”

Hopkins said the money raised for advertising is important but more important are the 600-plus organizations across the state that have come out against 101, 60 and 61. (A complete list is online at www.donthurtcolorado.com)

“This is probably the only time you’ll have the AFL-CIO and the Denver Chamber of Commerce on the same page,” he said. “There’s definitely bipartisan opposition to it. We believe the grassroots support and the organizations on our side are very important. We feel people will trust the organizations they belong to.”