Proposition 103 (tax measure for education funding)


No state tax increase. That’s what Colorado voters seemed to be saying on election night.

Proposition 103, the only statewide measure on the 2011 coordinated election ballot, seems headed to defeat. With 98 percent of precincts reporting as of press time Tuesday night, the measure was failing 63.6 percent to 36.3 percent statewide. In Boulder County, home of the measure’s author and primary sponsor, State Sen. Rollie Heath, the measure passed by a modest margin, with 54.61 percent of voters favoring the measure.

Heath told Boulder Weekly he was “disappointed,” but he was already looking forward.

“We’ve got to look at this as an early beginning. I think we’ve got a lot of momentum in the conversation, and we know we’ve got a real problem and I hope we resolve ourselves to figure out what we need to do long term.”

If passed, Proposition 103 would have raised the state income tax from 4.63 percent to 5 percent and the state sales tax from 2.9 percent to 3 percent, returning them to 1999 levels for five years. The revenue generated — an estimated $3 billion — would have gone toward funding education in Colorado.

Proposition 103 was Heath’s attempt to deal with Colorado’s worsening state budget crisis, which has been exacerbated by the combined impact of the Gallagher Amendment, Taxpayer’s Bill of Rights (TABOR) and Amendment 23, all of which were passed by voters. Gallagher was passed in 1982 after Colorado property owners demanded that the state legislature do something about increasing property taxes. It requires a 45/55 percent split between residential and business property through the state and sets rules about how property values are assessed, among other things. TABOR, passed 10 years after Gallagher, requires a vote of the people before government can raise taxes and sets limits on how much money the state can keep. Amendment 23, an attempt by voters to circumvent TABOR, requires the state to fund K-12 education at the rate of inflation plus 1 percent. The 1 percent provision expired a year ago, while budget difficulties during the recession have resulted in cuts to areas of K-12 funding that an administrative ruling determined aren’t protected under the language of Amendment 23.

The combined result is less revenue in the state’s general fund with steep cuts to areas of education that fall outside the protection of Amendment 23.

Heath told Boulder Weekly this fall that after voting for a budget that resulted in $260 million in cuts in education, he felt he had to do something to generate more revenue and prevent even deeper cuts in the future. He acknowledged that Proposition 103 wouldn’t solve the problem but felt that additional funding would help restore some of the funds cut from education immediately, aiding kids impacted by those cuts and giving state lawmakers more time to resolve Colorado’s budgetary woes.

But opponents of the measure claimed it would short circuit the state’s economic recovery, raising taxes on people who were already struggling. Their message seems to have resonated with voters.

Heath dismissed the impact of opponents’ message, saying he doesn’t think they have strong outreach. However, he acknowledged that economic concerns played a role.

“I just think people aren’t ready to start reinvesting again,” he said.

He said he expects that will change when voters realize how dire the state’s economic situation truly is, pointing to past budget cuts and the results of a recent study released by the University of Denver.

DU researches offered a grim outlook on the state’s economy in September, predicting that the state’s funding gap will eventually consume the state budget across the board, leaving too little funding by 2025 to fund even Medicaid, prisons and schools.

Says Heath: “Listening to the projection today and the DU study — we’ve got some pretty difficult roads ahead.”