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Drama, tempers and maneuvering as Colorado lawmakers race to offer property tax relief

The Colorado Senate GOP caucus tried to use a parliamentary objection to extend the session until at least Tuesday
The Colorado Senate chamber is shown through a fisheye lens Thursday, March 23, 2023, in the State Capitol in Denver. (AP Photo/David Zalubowski)

The Colorado Senate briefly devolved into political chaos Friday night as the chamber’s Democratic majority blocked a Republican attempt to force the state’s special legislative session on property tax relief to stretch well into next week in protest of the policies moving through the Capitol.

There were accusations of bad-faith negotiations and parliamentary maneuvering and pleas to let lawmakers and staff spend Thanksgiving with their families.

“I’m exhausted,” the normally affable Senate President Steve Fenberg, D-Boulder, said in a speech on the Senate floor. “This is exhausting.”

The situation underscored the property tax pressure facing state lawmakers as they rush to pass legislation before rates are locked for the 2023 tax year in mid-to-late December, when local governments must set their budgets and send out tax bills early next year. Gov. Jared Polis called the session after voters last week rejected Proposition HH, forcing Democrats to quickly come up with a Plan B or let home values that have risen by a median of 40% statewide cause large increases in people’s tax bills.

“What we’re doing now is already pushing the envelope,” Fenberg said as he tried to navigate the drama.

The unease began shortly after the special session gaveled in Friday morning when Senate Republicans objected to Democrats’ attempt to suspend rules in the chamber dictating how fast legislation can advance.

If the rules aren’t suspended with three days’ notice, two-thirds of the Senate must vote to waive them.

Motions to suspend the rules frequently pass without contention, but the GOP saw the rules as a way to make Democrats come to the property tax negotiating table. If a motion to suspend the rules failed, it would force the session to last until at least Tuesday instead of Sunday.

The Senate GOP caucus waited until after the session began to lodge their complaint, which angered Democrats who said Republicans had known for days how the majority planned to proceed.

Democrats warned that extending the session could make it difficult for local governments to implement any property tax relief the legislature passes. Republicans said the delay would ensure that Coloradans had time to understand the policies unveiled Thursday that lawmakers are debating.

Those proposals include not just property tax relief, as Republicans prefer, but also a $185 million expansion of a tax credit for low-income working families and $30 million for rental assistance for people facing eviction.

When the Senate voted Friday evening on whether to suspend the rules, the 12 Republicans in the chamber requested a roll-call vote and voted in unison to block the motion. All 23 Senate Democrats voted for the suspension, but it wasn’t enough to meet the two-thirds threshold.

Democrats then asked that the vote be redone, but before Republicans could ask that a roll-call vote be taken, Fenberg quickly called initiated a voice vote – in which senators holler out “aye” or “no” – and ruled that the motion passed.

Stunned Republicans objected – “sorry, those are the rules,” Fenberg replied – eventually asking the Senate to formally vote on an appeal to how Fenberg handled the situation. The appeal failed along party lines.

Republican Sen. Mark Baisley of Woodland Park, speaking in a tense gathering of lawmakers on the Senate floor, complained that he hadn’t heard Fenberg call for the vote. Fenberg shrugged and told Baisley he should have been paying closer attention.

Republican Sen. Barbara Kirkmeyer told her caucus that Fenberg had a “temper tantrum” and said she didn’t like being lectured to by a man in his late 30s. Fenberg accused Republicans of political theater and said they violated commitments they had made earlier in the week when Democrats shared their special session agenda and calendar. He said that’s why the vote on the motion to suspend the rules played out the way it did.

Ultimately, tempers cooled and the Senate adjourned late Friday without taking a preliminary floor vote on the property tax relief bill. That will now happen Saturday, which means the earliest the session can end is Monday.

It takes a minimum of three days to pass a bill in the Colorado legislature, but that’s only without any delays.

The dust-up may not mean much for the content of the policies that are eventually passed during the special session, but it will heighten tensions between Democrats and Republicans at the Capitol. Bitterness between the Democratic majority and Republican minority in the Senate, which typically work amicably, may also spill into January, when the legislature convenes for its regular lawmaking term that runs through early May.

Senate Minority Leader Paul Lundeen, R-Monument, hinted that Republicans were willing to waive the three-day notice requirement if Democrats would agree to repeal a provision unanimously passed by the legislature in 2022 offsetting property tax cuts by using $240 million in Taxpayer’s Bill of Rights surplus to reimburse schools and local districts for their lost revenue.

The 2022 legislation, Senate Bill 238, passed 62-0 in the House (with three representatives – including Republican Marc Catlin – excused) and 33-0 in the Senate (with two senators – Republicans Don Coram and Kevin Priola – excused).

The property tax relief in the measure was later determined not to be sufficient to counteract the effect of rising property values, which is why Proposition HH was introduced and why lawmakers were called into a special session.

Lundeen was among the Republicans who voted for Senate Bill 238, but he said voters’ rejection of Proposition HH was a clear sign that Coloradans don’t want the government to reduce their state taxpayer refunds, which come from the surplus. HH was projected to tap into billions of dollars in TABOR surplus over 10 years.

The surplus comes from money collected by the state in excess of the TABOR cap on government growth and spending, which is determined each year by increases in inflation and population. Any money collected over the cap has to be refunded to taxpayers.

“A wise man once said: ‘When the facts change, I reserve the right to change my mind,’” Lundeen told The Colorado Sun this week. “The facts have changed fundamentally with HH.”

Lundeen tried to broker a deal with Democrats in which the $240 million in TABOR surplus used for reimbursements in Senate Bill 238 would be converted into general fund reserve dollars.

“We’ve been trying to get a deal all afternoon,” Lundeen told his caucus on the Senate floor just before the vote to waive the rules was taken.

But Democrats in the Senate rebuffed the request. They repeatedly reminded Republicans on Friday that they had voted in unison for Senate Bill 238.

“Sorry you all voted for that two years ago,” Fenberg said in a speech on the Senate floor. “You may regret it, but that’s not my problem.”

Democrats also warned that using reserve dollars could set the state up for failure in an economic downturn and could affect the state government’s credit rating.

At $2.2 billion and climbing, the state’s 15% reserve adds up to a lot of money. But even that huge amount wouldn’t last two years if Colorado faced a deep recession, a Joint Budget Committee staff analysis found.

Lawmakers have other reasons to be wary about depleting the reserves. The state already faces potential budget shortfalls this year, budget staff told lawmakers Thursday. Balancing the budget gets even harder down the road if Democrats are going to keep their promise to fully fund schools.

Eliminating the K-12 funding shortfall would only require $75 million from next year’s general fund. The following year, it would take another $270 million increase on top of that.

The same parliamentary drama didn’t play out Friday in the House, which moved to advance legislation of its own and worked late into the night Friday. But with the Senate’s calendar now delayed, representatives will be in the same time-crunch predicament as their colleagues in the legislature’s upper chamber.

Democrats’ special session property tax relief plan calls for homeowners to get the same break in the 2023 tax year as they would have gotten under Proposition HH.

Democrats’ bill would reduce the residential assessment rate for the 2023 tax year only to 6.7% from 6.765% and exempt the first $50,000 in a home’s value from taxation, the same reductions for taxes due next year as Proposition HH offered. Property tax rates for commercial property would remain unchanged, however, whereas HH would have cut those rates.

The Democratic special session plan calls for $200 million in general fund dollars to fully reimburse schools and fire districts for the revenue they wouldn’t collect because of the property tax relief.

All other local districts, including hospital and EMS districts, would only get state dollars to make up for their losses if their property tax revenue gains are set to rise less than the rate of inflation. That’s less reimbursement than would have been offered under HH and it will mean that a limited number of local districts will get state aid.

The plan, which passed out of the Senate Finance Committee on Friday along party lines after local districts asked for more money, doesn’t call for using any additional Taxpayer’s Bill of Rights surplus or general fund reserve dollars to reimburse school and local districts for their property tax losses, – pools of money Polis last week suggested the legislature could tap into.

Democrats are also running bills during the special session to expand the earned income tax credit, make TABOR refund checks the same amount for every taxpayer and tap into federal dollars that pay for meals for children from low-income families during the summer.

The Democratic majority at the Capitol voted down every Republican special session bill introduced Friday.



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