Colorado Referenda C & D
On November 1st Colorado voters will be asked to decide Referendum C and associated or conditional Referendum D, which have generated more debate in print and on the air than any other referendum in recent memory. Our recommendation? Vote no on both. Our natural inclination is to vote against anything that gives the government more power or more money. And if a power and money issue is not clearly supported by one party and opposed by the other, there must be something fundamentally wrong with it.
Colorado’s TABOR (Taxpayers’ Bill of Rights) Amendment has become a model for legislation limiting state government spending. In simple terms, TABOR decrees that taxes cannot be increased without a vote, and spending can be increased or decreased each year using a formula that takes inflation and population growth into account. If the state collects more taxes than it is entitled to spend under the formula, the surplus is refunded to taxpayers. Referendum C would allow the state to keep the surplus, and spend it, for the next five years. Referendum D is mostly related to borrowing, and will be effective only if C is passed.
Opponents of Referendum C are saying that this is a tax increase. Supporters say that the tax rates will not change, so not only is it not a tax increase, the opposition is deliberately misleading the public in saying that it is. Our view is that the opponents are correct– it is a tax increase, and supporters of the referendum are the ones who are deliberately attempting to trick the voters.
Tax is money that is collected from the taxpayers and used by the government. TABOR limits the amount of tax that the government can collect and if the government collects more than is allowed, the surplus is refunded to voters. If the surplus is not refunded, then more tax has been collected, which is to say that taxes have been increased.
All local and regional governments in Colorado are bound by the provisions of TABOR, and almost all of them have “gone to the well” for tax increases in the 13 years that TABOR has been in effect. They have done the right thing, in asking the voters for tax increases for specific purposes, and the requests have for the most part been approved. Over 800 such proposals have been sent to the polls, and approximately 86% have been approved by the voters. Such issues as the construction of a new baseball stadium, and a new football stadium, as well as regional light rail systems, indicate that the people of Colorado are pretty generous.
The state government may indeed be suffering from the economic recession that is affecting most of its citizens. This election could have been about specific tax increases for specific purposes, complying with both the letter and the spirit of TABOR. Instead, the goverment is asking for a blank check even though we said through TABOR we don’t want them to have one.
If you really are wondering what happened to Referendum A and Referendum B, we voted on them last year. The Colorado General Assembly has two-year sessions (like Congress); C and D are the third and fourth referenda put to the voters during the 57th Session.
–SG
What do you think? Please enter a comment below.
September 29th, 2005 at 4:31 pm
Stupid government. What do they think we are? All the signs about vote yes on c & d cost a bundle. If it passes it will allow the state to INCREASE spending by $3.743 BILLION dollars over the next 5 years. Ridiculous. If not passed then the state will have less to spend over the following years. well they could try budgeting–HELLO.
September 29th, 2005 at 4:55 pm
I just got my blue book and the only thing that worries me is the part about “ratcheting down.” What is that all about? Plus doesn’t the referendum say what the money is to be spent on, so wouldn’t it be ok with TABOR?
October 5th, 2005 at 10:16 am
Thanks for the valable information. Now i can make somewhat of an educated vote in November.
October 5th, 2005 at 5:53 pm
JAM refers to the “blue book” which is a mandatory publication by the state government explaining ballot issues. The blue book is prepared by a “non-partisan” research staff of the CO legislature, and it is supposed to explain the background for an issue and what will happen if it is passed, along with supposedley “balanced” arguments for and against. The wording of the explanation, and the arguments, is supposedly approved by the parties before the blue book is mailed to every voter in the state. It seems to be something of a game over there to see what political shenanigans can be embedded in the book without being noticed by “the other side.”
The “ratcheting down” issue is case in point. The Blue Book says that since current year spending is limited to a formulaic increase on the previous year, spending can NEVER achieve the levels that it would have if there had been no recession. Duh!
They make it sound as if this is a fundamental flaw in TABOR, but in fact it is intentional. If you counter the effect (as they are trying to do with Referendum C) then the state budget becomes partly immune from recessionary effects in the economy, at the expense of taxpayers who have no such protection. But here’s an analogy which will clearly show you why the “ratcheting down” idea is a red herring. We are all familiar with the concept of “accumulated interest.” That means if you put $100 in the bank for a year at 3% interest, at the end of the year you will have $103 in your account. Next year you will earn the interest on the $103, or $3.03 instead of just $3.00. And so it goes. Let’s say in the second year, your bank reduces the interest to 2%. You have less interest income and a lower balance at the end of the year. If the bank puts the interest rate back up to 3%, you will NEVER EVER have as much money as you would have if they hadn’t reduced it for a year.
What the proponents of C are saying is, in effect, “the state will never have as much money as they would have, if they had more money.” Their attempt to redress the situation through C would be a bit like you going to the bank and telling them they must increase your interest rate to 4% make up for your “loss” when it was only 2%
As for your other question, the the proposed expenditure of the “surplus” is so general that it amounts to a blank check. The SIX “areas” in which the surplus can be spent amount to 86% of the budget. That’s why so many organizations are campaigning in favor of it– they think that the state is going to spend the money on THEM! AARP is supporting it because they say the state will be able to restore the property tax exemption for senior citizens. The state COULD restore the exemption (whether C passes or not), but there is nothing to indicate that they WILL, and they certainly won’t be REQUIRED to!
If this hasn’t made you suspicious of the “factuality” and “impartiality” of the blue book writers, consider this: one of the listed arguments FOR the referendum begins “Without raising taxes….” And the very first argument AGAINST it begins “Referendum C is effectively a tax increase.” It can’t be both, guys, so WHICH IS IT?
–SG
October 19th, 2005 at 10:12 pm
i think that they are just making up this stuff. there is no such thing as referendum D they are just tryin to find a way to make us poor. they think they need the money more than we do. we already pay taxes, there’s no need for another thing to come up out of the blue and take more of our money!
and thats a fact!!!