Court overturns tax freeze in Colorado school finance law |

Court overturns tax freeze in Colorado school finance law

Dan Elliott
The Associated Press
Aspen, CO Colorado

DENVER ” A law expected to raise $1.7 billion for Colorado schools over the next 11 years is unconstitutional because it gives the state more tax revenue without required approval from voters, a judge ruled Friday.

State officials immediately vowed to appeal.

The 2007 law freezes property tax rates in some school districts where they had been expected to decline and funnels the extra money to education. It raised $118 million in its first year.

Denver District Judge Christina M. Habas ruled the additional revenue should have been approved in advance by Colorado voters under the Taxpayer’s Bill of Rights, or TABOR, a voter-approved state constitutional amendment that limits taxes and spending.

Habas rejected the state’s argument that the education finance law only redistributes revenue, rather than raising it.

Gov. Bill Ritter’s spokesman said the state will ask the Colorado Supreme Court to hear the case on appeal, bypassing the state Court of Appeals.

“We’re really a little surprised at her ruling,” said the spokesman, Evan Dreyer.

“We remain confident in our position. (The tax freeze) was the right thing to do last year for the kids of Colorado, for the schools of Colorado and for the fiscal health of the state education fund,” he said.

Jon Caldara, president of the conservative Independence Institute think tank, called the ruling “a huge victory for the taxpayers of Colorado.”

“For everyday citizens, it means they still have a right to vote before their taxes are raised,” he said. “It’s too bad we had to spend the last year putting together a lawsuit telling politicians the Constitution actually means what it says.”

State Attorney General John Suthers, who disagreed with Ritter in 2007 and said the law was unconstitutional, also hailed Habas’ ruling.

The lawsuit challenging the law was filed by the Mesa County Commissioners, a business owner and four taxpayers with help from the Independence Institute.

Habas denied the plaintiffs’ request that she order a tax refund, saying she doesn’t know if she has that authority and that neither side has had time to argue that point.

Habas’ 15-page ruling noted the complexity of the case.

“Untangling the various provisions of TABOR … presents a difficult task indeed,” she wrote.

Another voter-approved amendment requires the state to boost education funding each year. When legislators were considering the property-tax freeze, the state education fund was forecast to run out of money by 2012.

“While this Court candidly expresses its concern as to the resulting consequences of this decision, it must nonetheless perform its duties in a manner consistent with its oath to uphold the Constitution,” Habas wrote in her ruling.