Guest commentary: Amendment 66 and its Aspen impact
October 22, 2013
What is Amendment 66?
Amendment 66 will change the way Colorado public schools are financed.
Currently, the state uses a combination of property tax and general fund revenues to support school districts. However, due to revenue reductions resulting from the economic recession, school districts have received approximately $1 billion less than they are entitled to each year.
The Aspen School District, for example, is allocated $17,127,883 in total program funds this year but will receive only $14,475,161, a difference of $2,652,722. Even when the economy improves and additional revenues become available, Colorado's Taxpayer Bill of Rights (TABOR) will limit the revenues that can be retained by the state, which in turn prevents the state from restoring funding to education.
Amendment 66 proposes an increase in the state income-tax rate for all Colorado citizens with new proceeds designated for education. Specifically, the rate will increase from 4.63 percent to 5 percent on the first $75,000 of taxable income, and to 5.9 percent on any taxable income above $75,000. This increase is expected to generate an additional $950 million annually for pre-kindergarten through 12th-grade public school funding. The legislature supports this tax as it will provide a more reliable mechanism to fund a portion of the dollars allocated to education and will give the legislature greater flexibility in budgeting for expenditures other than schools.
Amendment 66 will implement Senate Bill 213 which, in part, funds all-day kindergarten, provides additional funding for early childhood education and changes the formula used by the state to calculate the amount of total program money each school district is entitled to collect annually. The new formula places greater emphasis on the total number of students who are more expensive to educate, such as at-risk children, children with special needs, gifted and talented children and English-language learners, but it removes the cost-of-living factor as a component of the formula.
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How would its passage impact the Aspen School District?
If Amendment 66 passes, Aspen's funded total program would be reset at $14,723,125, an increase of approximately $250,000 from the current level but still less than its pre-recession level. The Aspen School District also would receive additional funding for special education and gifted and talented students in the range of $68,000 to $89,000, and parents would not pay for full-day kindergarten. Finally, new rules regarding mill levy overrides would allow the district to obtain more money locally through potential property tax increases.
The elimination of the cost-of-living factor impacts resort communities disproportionately and is the primary reason for Aspen's significant loss in total program dollars. SB 213 would allow the district to seek a property tax mill levy override from its voters to replace the loss of revenue if the cost-of-living factor was eliminated. The Aspen School District administration, Board of Education and teachers met repeatedly with our state congressional representatives and the sponsor of the bill, both before and after the bill was passed, to request that the cost-of-living factor be reinstated — our chief financial officer even submitted a proposed amendment that would have accomplished that goal — but the legislature was not amenable to our request.
Amendment 66 appears to have definable benefits for Colorado as a whole. As for Aspen, the district will receive slightly more state money than at present and would have greater capacity to ask for additional funds from local property taxes, but taxpayers will see an increase in their income taxes ranging from 8 percent to 27 percent (see the "tax calculator" located at http://www.coloradocommits.com/calculator/).
Neither Amendment 66 nor the current finance structure offers the hope of increased long-term funding from the state beyond either the current or proposed levels of $14.5 million to $14.7 million. As a result, the district will still need to determine a long-term solution on a local basis by trimming programs, raising revenues through mill levy overrides and/or extending the sales tax beyond its 2016 expiration.
The Aspen School District administration and Board of Education are not taking a formal position on Amendment 66 but want to ensure district voters are educated as to the local impacts of the passage or failure of the amendment.
Authors of this commentary are Charla Belinski, Sheila Wills, Bob Glah, Elizabeth Parker and Sandra Peirce, all of whom are members of the Aspen School District Board of Education.
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