From the Aspen Daily News (Brent Gardner-Smith):
…if all three measures are approved, Pitkin County Finance Director John Redmond estimates the county could ultimately lose almost $14 million in revenue, with the county’s open space program taking an $11 million hit and the county’s general operating fund losing about $2.2 million a year. “It is roughly a 10 percent hit to the budget,” Redmond said.
The potential harm to local governments and special districts can be put into two categories. The first category is a direct revenue cut. For example, Proposition 101 cuts vehicle registration fees, which many local governments have come to rely on in their budgets.
The second category is a change in the law that could have potential negative implications for a local government. For example, Amendment 60 requires that property tax questions be voted on only in November, which some officials think will crowd the ballot and make it likely that voters will say “no” to all tax measures each November.
The direct revenue cuts under Proposition 101 are perhaps the easiest to plug into a spreadsheet, as the measure would lower vehicle registration fees and taxes on telecommunications services to local governments over the next four years. It would also lower the state income tax rate over the next 10 years. If Proposition 101 is approved, the city of Aspen could lose $866,000 in revenue next year and $1.1 million in four years, according to city finance director Don Taylor. Today the city uses the tax money for general operations and to fund parks, housing, day care and transportation. Pitkin County’s Redmond estimates the county would lose $1.8 million next year from its general fund budget as a result of Proposition 101. The Aspen School District estimates it would lose $900,000 by the fourth year of the reductions, according to Kate Fuentes, the district’s finance director. Town of Snowmass Village Finance Director Marianne Rakowski estimates the town would lose $266,000 from its general fund budget the first year under Prop 101 and $383,000 the fourth year…
the Aspen School District doesn’t see anything fair about Amendment 60. The measure requires school districts to cut their property tax rates in half by 2020, except for those taxes tied directly to debt payments. Fuentes estimates Amendment 60 would reduce the district’s tax revenues by more than $8.8 million in 10 years…
Amendment 60 also could strip revenue directly out of some other entities’ budgets, as it eliminates prior approvals from voters to “de-Bruce” certain tax streams from the restrictions of the Taxpayers Bill of Rights, a constitutional provision authored by Douglas Bruce of Colorado Springs. If passed, Amendment 60 would require that the county’s open space tax, for example, no longer be exempt from TABOR. This would mean $11 million that voters approved for the purchase of open space wouldn’t be available.
Amendment 60 also would require governments to pay taxes on their assets for the first time. This provision has left most government officials inserting question marks in spreadsheets about potential costs. “What is the golf course worth?” asks Aspen’s Taylor about the city’s municipal course. “You can’t do anything with it, other than run it as a golf course, and as a money-making proposition it is not very valuable.” On the other hand, Taylor said the city’s water treatment plant is quite valuable.
Amendment 61, for example, requires voter approval (in November) of any borrowing by a local governmental entity, such as when the hospital district enters into a lease to obtain an expensive piece of medical equipment. “That’s pretty imposing,” said Aspen Valley Hospital CEO David Ressler, who noted that it often makes financial sense for the hospital district to lease medical equipment rather than buy it outright. “It limits our options.” Ressler is also concerned about the provision in Amendment 61 that would not allow entities to issue new debt for more than 10 years, instead of the more normal 20-year term. “That has the effect of doubling your debt service,” Ressler said. “You pay less interest in the long run, but it costs twice as much money in the short run.”
More coverage from the Cortez Journal (Hope Nealson):
Proposition 101 would lower the state income tax rate, first to 4.5 percent and then to 3.5 percent, and lower taxes for vehicle uses. Amendment 60 is aimed at helping to reduce property taxes. Amendment 61 would limit the ability for local governments and state government to borrow. Public enterprises and authorities, such as the Montezuma County Housing Authority, water districts, colleges and universities also would be required to pay taxes on the property they own under Amendment 60. For example, the Colorado Division of Wildlife is an enterprise that owns thousands of acres spanning many counties, so the division of wildlife would be required to pay property taxes in every county in which it owns land…
Amendment 60 also focuses on school districts, requiring them to cut their property tax rates in half by 2020. The state is required to replace the revenue lost by school districts. That’s a tricky endeavor because the passage of Proposition 101 would reduce state income by 25 percent over time.
Proposition 101 proposes reducing state and local government budgets by more than $2 billion from lost state income tax revenue, according to Looking Forward, a collaboration between the Colorado Fiscal Policy Institute, the Colorado Children’s Campaign and the Bell Policy Center to educate Coloradans about state fiscal policy. More than 40 percent of income tax revenue goes to kindergarten through 12th-grade funding, Looking Forward reported…
Proposition 101 would reduce vehicle ownership taxes over a four-year period to $2 for a new vehicle and $1 for a used vehicle. The proposition also would cut telecommunication and income taxes. With vehicle license and registration fees dropping to their 1919 level of $10 through Proposition 101, Schuenemeyer estimated the reductions in vehicle ownership taxes alone would cut funding for local school districts from $1.6 million in 2009 to $19,148…
Amendment 61 calls for prohibiting borrowing by state or local government and requires voter approval for future loans, limiting the form, term, and amount of total borrowing by each local governmental entity and directing all current borrowing to be paid. “This means governmental entities in the state – counties, cities, towns, school districts, fire districts, water districts, etc. – are prohibited from borrowing any amount of money without voter approval and elections can only be held in November,” Schuenemeyer said. Colorado would not be able to issue bonds or borrow in any other way, including lease purchases, for any reason, even in emergencies. And bonds can be issued for only 10 years, he added.
More 2010 Colorado elections coverage here.
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