Colorado performs more effectively when our parties work together

Every legislative session there is a lot of talk about partisanship and Republicans and Democrats can’t work together to get anything important done. While there is a grain of truth in this statement – there are several examples of the Republican controlled Senate killing bills from the Democratically controlled House and vice versa – there also are dozens of bills every session that make it to the governor’s desk with bipartisan support.

The 2017 legislative session was no different. Partisanship is more acute on “big” bills that touch on fundamental difference between the two parties. But this legislative session was an exception. There was one major bill that passed because the two parties cooperated. Neither party got all they wanted. But both received results that were particularly import to their interests.
This is what compromise and bipartisanship is all about. This is the way a legislature can, and should, work. This is called governing!! Let us hope that the benefits are recognized, and that the state is better when the parties work together.
This particular legislation is Senate Bill (SB) 17-267. The title is: “CONCERNING THE SUSTAINABILITY OF RURAL COLORADO”. But it is much more than this.

Perhaps the single force that made passage of this bill imperative is the very critical financial position of many of the rural and smaller city hospitals, putting in doubt the ability to provide minimum health care – something everyone deserves.
The next most critical area covered by the bill is funding of smaller school districts. Property tax is the primary source of school funding. Although most school districts believe they are underfunded, the situation is particularly acute in small districts with little or no commercial real estate.

A primary cause of a small tax base is The “Gallagher Constitutional Amendment”, which influences state-wide assessment rates. Over time, the portion of property tax generated by commercial/industrial real estate has increased very significantly. The result is that small districts with a mostly residential property tax base can’t raise sufficient funds for their minimum needs to provide adequate education and other services. The state does provide significant additional funding for education, but rural areas still come up too short of minimum funding needs. Besides school districts, it also causes under funding in many small districts that provide vital services such as fire and police protection.

The problem is compounded in those 17 counties that have not “de-Bruced”. “De-Bruced” means that the county, or any taxing district has voted to be excluded from the requirements of the Taxpayers Bill of Rights (TABOR, which was initiated by Douglas Bruce in 1992). These taxing districts that have not “de-Bruced” establish a budget based on allowed revenue in compliance with the restrictions of TABOR. Then state legislation, meant to assist the taxing district, may cause the district to go over the allowed revenue limit. This potentially forces the taxing district to cut funding in other areas. In essence – state law could override the local budget priorities. Something no one wants. One result is the financial problems of these 17 counties may disproportionately impact legislation being considered at the state level.

These are the primary areas impacted by SB17-267:

The bill is 59 pages long with a lot of detail. For those interested, it is recommended to go to the state legislature web page and study the bill. Here is the link:

  • For each of the next four years the state will arrange for lease purchases of state real estate. This will raise about $500 million each of the 4 years. Total about $2 Billion. The leases will be payable at no more than $150 million a year for 20 years. This is $3 Billion total cost. This method of financing is designed to comply with the state constitution, which limits the creation of debt.
    The hospital provider fee will be modified so that the fee is not considered when calculating a possible TABOR refund. This could impact allowable revenue by approximately $600 million. As a compromise, the base for making this TABOR calculation will be reduced by $200 million. The net impact is approximately a plus $400 million allowed under the TABOR cap.
  • There will be additional funds for road construction and maintenance ($1.88 billion over 20 years). But this amount is small in comparison to the well-documented needs of the state (at least $9 billion over ten years).
  • There will be supplemental funding for both rural hospitals and rural schools. It is anticipated this will keep the hospitals and medical clinics functioning at a minimally acceptable level.
  • The budgets submitted by state departments for the year 2017-2018 will be 2 per cent less than the actual budget for the prior year. This does not limit the amount the legislature actually approves.
  • The Marijuana tax is adjusted and the allocation modified.
  • AND: of particular interest to many seniors – The Homestead Act (reducing property taxes for seniors who qualify) will be the first group funded by TABOR refunds when they are available. It does not impact funding when there is no TABOR refund. In those years funding will be at the discretion of the legislative budget process.

To reiterate: this is a bill that had something for many, but has compromises by all parties involved. But, it is a step forward. The legislature can be proud that they worked together to come up with pragmatic solutions to problems that needed solving. Let’s anticipate they will continue to productively work together in 2018 and beyond.

The Colorado Senior Lobby acknowledges the work of the bill sponsors – Senator Jerry Sonnenberg (R), Senator Lucia Guzman (D), Representative KC Becker (D), and Representative John Becker (R) – and Governor John Hickenlooper for this accomplishment.

Ed Shackelford – REALTOR®
Real Living CO Properties –
President: Colorado Senior Lobby
Phone: 303-832-4535