Colorado Democrats want to increase the tax obligation of Coloradans earning at least $300,000 and allow the state to keep dollars due to be refunded to residents under two ballot proposals they say would fix a $50 million deficit in a program meant to provide free meals to all students.     

If the ballot measures succeed, taxpayers under this income bracket will pay an average of $385 more in tax obligations for individuals and $570 for joint filers. 

The proposals would generate about $107 million a year.   

Approved by voters in 2022, Proposition FF increased the tax obligations of some residents by adding back deductions when computing their state tax obligations in order to pay for the “Healthy School Meals for All Program,” which offers free breakfast and lunch to all K-12 public school students.

The program provided 100 million meals to students in its first year, but state policymakers underestimated its cost.

Initially, state analysts said the program would cost up to $115.5 million in fiscal year 2023-2024 and anywhere from $71.4 to $101.5 million the following year. However, the actual figures came in at $166 million and more than $131 million in those two years, respectively.

The cost overrun — resulting from a combination of unforeseen and anticipated challenges, inflation, discrepancies in estimates and federal changes — prompted complaints from lawmakers, who earlier noted that previous analyses already showed that the “math doesn’t work, and nobody listened.” 

Because of the $50 million deficit, key elements of the program, including pay increases for school cafeteria workers and partnerships between schools and local agriculture producers, have not been implemented. 

The amount of revenue the tax changes brought in actually exceeded the estimate by $12 million, and under the Taxpayer’s Bill of Rights, that must be returned to taxpayers — unless voters allow the state to retain that amount.

$570 more in taxes for joint filers  

Now lawmakers want to go back to the voters and ask them to further increase the tax obligation of people earning at least $300,000.   

House Bill 1274, sponsored by Rep. Lorena Garcia, D-Denver, and Sen. Dafna Michaelson Jenet, D-Commerce City, proposes two ballot measures, one of which would allow the state to retain the $12.4 million in revenue collected above the initial estimate.

Under the current law enacted in Proposition FF, Coloradans with an adjusted gross income of at least $300,000 must add back a portion of the federal standard or itemized deductions for the purposes of computing the state taxable income. Currently, deductions above $12,000 are required to be added back.

HB 1274‘s second ballot measure would change that deduction threshold to $1,000 for single tax filers and $2,000 for joint filers.

The change would apply to about 194,000 taxpayers with incomes greater than $300,000 in tax year 2026.   

The bill would also create a cash reserve in the Healthy School Meals for All Cash Fund.

Garcia said the state is facing a “now-or-never situation,” especially considering the potential for changes at the federal level that could decrease the number of students eligible to receive free or reduced meals through the U.S. Department of Agriculture’s Community Eligibility Provision. The federal program provides reimbursements for three-quarters of the state’s school districts. 

“We know that a lot of work went into Prop FF, and we had hoped sincerely that our estimates of funding needed for FF was on the mark, but we have had a number of new factors emerge since it was passed in 2022,” Garcia said, noting record-high food costs, higher program participation and changes to the federal reimbursement program.

“All of these things mean our money has not gone as far as we need, and we face new uncertainties that make this bill very timely,” she added.

If the measures don’t pass, the meals program will be unable to continue, putting thousands of students at risk of going hungry, Garcia said. 

Eight other states have universal school meal programs, Anya Rose of Hunger Free Colorado told Colorado Politics.

Like Colorado, those programs also faced funding challenges due to rising food costs and federal changes. Those states found a way to find money in their budgets to cover costs  — something Colorado can’t do in the same manner due to TABOR, Rose said. 

“It’s clear that the only way to provide stability for this program in uncertain times is to raise additional funds and build a reserve to help weather federal policy changes while providing meals to students without interruption,” she said.

A hard lesson

Rep. Jennifer Bacon, D-Denver, said Proposition FF taught lawmakers an important lesson — before putting a measure on the ballot, they need to seriously consider whether the state can, in fact, afford it.

“We do not have an infinite pool of money in this state,” she said.

Bacon nonetheless praised the program’s goal to provide students with fresh, healthy Colorado-grown food. 

“Not all families need free meals,” argued Rep. Lori Garcia Sander, R-Eaton.

As a former principal, she said the voters who approved Proposition FF would be “appalled” if they saw how much food goes to waste in school cafeterias. 

She also challenged the argument that the program would help reduce “stigma,” as there are already measures in place to ensure students and staffers don’t know which students qualify for free and reduced meals. 

“Given the economy, I have to ask: What are the must-haves versus want-to-haves?” she said. “I don’t believe the majority of Colorado’s taxpayers will have the appetite for this this year.”

Supporters say program erases stigma

Supporters made several claims in support of the bill.

Dan Sharp, the school nutrition director of Mesa County’s School District 51, said the program reduced the stigma against low-income students by allowing everybody to receive free meals. Before the program, many students eligible to receive free or reduced meals chose to go hungry because they didn’t want their peers to find out they were poor, he claimed. 

District 51 has seen a 40% increase in meals served to students since the program was first implemented in 2023.

Zander Kaschub of the Jeffco Education Support Professionals Association said the increase in meal demand has put a strain on cafeteria workers, especially in districts that can’t afford to hire additional staffers to manage the increased workload. 

“This bill directly supports food service workers by providing direct funding that school districts can use for wage increases,” Kaschub said. “We cannot have a strong, sustainable school meal program without a strong, sustainable workforce.”

Others, like Rachel Landis of the Durango-based Good Food Collective, said the program allows schools to partner with farmers and ranchers, providing the latter with a stable and reliable source of income.

The House Education Committee advanced the bill on a 7-5 on a party line vote. Its next stop is the House Finance Committee.