ACRA board takes stand against tax caps
September 1, 2010
ASPEN – Members of the Aspen Chamber Resort Association’s board of directors Tuesday lambasted three tax-slashing initiatives that many expect to have a deleterious effects on both the state and local economies.
The board, during its monthly meeting, unanimously approved a resolution to oppose Amendments 60 and 61 and Proposition 101.
The measures involve extending far-reaching tax caps on the state Legislature and local governments, which would restrict lawmakers’ ability to fund many state programs, according to city officials.
Perhaps the most vexing concern among the legislative community is that Amendment 60 will effectively shift $1.5 billion of the K-12 education budget every year onto the state.
“It’s an attack on each and every citizen. It’s an attack on education. … It’s an attack on the right to live in a place where a fire can be put out,” Pitkin County Commissioner Michael Owsley told ACRA members.
Aspen is home to one of seven school districts in the state that depends entirely on special taxing districts, which could accelerate the effect of the measures on the school district’s budget.
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If the measure passes in conjunction with the other two, 99 percent of the state’s general operating budget will be taken by K-12 education, leaving scant money for other programs, like higher education and prisons, the Colorado Legislative Council said in a study.
Amendment 61 imposes broad restrictions on borrowing for new projects, including a ban on borrowing for the state. That means Colorado would no longer be able to borrow money for its transportation system, which has taken blows in recent years from the economic downturn and a series of conflicting budgetary restraints in the state’s financing policies.
The state would have to pay for new projects up front, and cities and counties would have to pay back all debts within 10 years. That would also speed up increases on special taxing districts, said Aspen Finance Director Don Taylor.
Proposition 101 would reduce state income tax from 4.6 percent to 3.5 percent, reduce a wide range of fees and taxes on cars, and eliminate state and local government taxes on telecommunications.
Average projected savings for homeowners if the amendments pass would be about $2,500 in taxes every year, according to an analysis of the proposals done by the Legislature.
But the same analysis says the state would lose $2.1 billion in tax revenue.
The county and the city are both preparing leaner, alternative budgets for the next fiscal year that include projections if the measures are approved in November.
The ballot proposals strongly resemble the Taxpayers Bill of Right, or TABOR, a broad, tax-limiting law voted into the state Constitution in 1992. Lawmakers have blamed TABOR for exacerbating the recession in Colorado by taking any financial wiggle room away from the Joint Budget Committee, which prepares and implements the state budget every year.
Supporters of the initiatives, who belong to a collaborative grassroots campaign that wants to reduce the size of government, say the laws would help taxpayers’ wallets and impose more accountability onto Colorado governments.
They also say the opposition is mostly comprised of government officials who want to keep taxes high and government big and inefficient.
Helen Klanderud, former Aspen mayor, said the campaign is likely to be effective because voters are increasingly skeptical about the way the government is using tax money.
“If the proponents of this spin it as government wanting to fatten their coffers, there’s a good chance this is going to pass,” Klanderud said.
Dave Ressler is CEO of Aspen Valley Hospital, which is asking voters for a mill levy increase in November. He said the upcoming election is more likely to attract citizens who don’t normally vote because ultraconservative third-party candidate Tom Tancredo is running for governor.
“Tancredo’s gonna bring out a whole block of voters [who] haven’t voted before,” he said.
The ACRA board said a broad educational initiative about the effects of the measures needs to be implemented to convince voters that the proposals are not in the state’s best interest.
“It’s very attractive to say that my property taxes are gonna be cut in half,” said Warren Klug, chairman of ACRA.
The Aspen City Council passed a similar resolution earlier this month.