Colo. lawmakers punt property tax dilemma to summer


The measure that could ask voters in November to repeal the Gallagher amendment cleared what's likely to be its biggest hurdle in the General Assembly: winning over five Republicans in the state Senate.

Sponsors, including Republican Sen. Jack Tate of Centennial and Democratic Sen. Chris Hansen of Denver, got three more than the 24 votes that Senate Concurrent Resolution 1 needed to pass.

SCR 1 passed on a 27 to 7 vote and now heads to the House, where it already has two of the three Republicans on board that will be needed to approve it.

The resolution requires a two-thirds vote in each chamber to move to the ballot. In the Senate, that's 24. The House will need 44.

Republican Reps. Janice Rich of Grand Junction and Matt Soper of Delta are already on the bill as co-sponsors, so they need just one more vote, assuming all the Democrats support it, to head to the November ballot. The resolution does not require any action from the governor.

Five of the seven Republicans who voted against the resolution Tuesday live in the urban Front Range. The other two: Sens. Ray Scott of Grand Junction and Jerry Sonnenberg of Sterling. 

The 38-year-old constitutional amendment balances the taxes paid by businesses and residential property owners. When home values on a statewide average grow faster than commercial properties, homeowners pay proportionately less while businesses pay more. That's required lawmakers to reduce the residential rate to keep the balance in check, which has happened every two years. 

In final comments, Sen. Bob Rankin, a Carbondale Republican, said Gallagher's biggest problem is in the word "statewide," meaning that assessment rates are calculated statewide, in a one-size-fits-all scenario. It's been hard on rural communities, which have more residential properties than commercial. Declining home property taxes means less money for schools, hospitals, fire departments and law enforcement agencies. 

Tate on Monday said the statewide averages are "blind to the differences between (poor) Cortez and (wealthy) Carbondale."

Tuesday, Hansen said the state currently pays for 65% of the cost of K-12 education, but without a repeal, it could reach 70% to 75% in the near future. "We're under-investing in classrooms, teachers and school districts...We cannot afford to dig ourselves into a deeper hole." 

Lawmakers also have worked hard to save rural hospitals, such as with Senate Bill 17-267. But without a change to Gallagher, Hansen said, the decline in residential rates will have a significant impact on hospitals and fire districts.

Hansen also announced there will be a companion bill that creates a moratorium that would freeze assessment rates indefinitely. 

"Gallagher has problems," said Sen. Owen Hill, a Colorado Springs Republican. But in the light of challenges from the pandemic, now is not the time to raise revenues from Coloradans, he said.

Hill also warned the repeal could push affordable ownership of homes out of reach for many Coloradans.

Sen. Larry Crowder, an Alamosa Republican, also announced he would vote for it, but warned "if legislation gets involved in raising property taxes, you’ll see a firestorm like you won’t believe. It’s the one Holy Grail for the citizens," he said. 

Colorado Rising State Action, a group poised to oppose the Gallagher repeal, noted Tuesday that the last time voters were asked, in 2003, the repealed failed 78% to 22%.

“While repealing Gallagher won’t do anything for businesses, it will certainly raise property taxes on families who can hardly afford that added financial burden right now," executive director Michael Fields said in a statement.

The right-leaning organizations said legislatures sure address funding formula for K-12 education more directly with a focus on students, rather than creating a uniform mill levy or repealing the Gallagher Amendment.

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