After first-day fireworks in the state Senate burned up plans for a three-day legislative special session, day two resembled a return to normalcy for the General Assembly.
But it wasn’t quiet. The House started Saturday with a group of pro-Palestine protesters interrupting the chamber’s morning work with calls for lawmakers to denounce Israel’s military campaign and urge a cease-fire. After the group was escorted out, Democratic leaders repeatedly tussled with Republicans who ignored those leaders’ directions to follow House rules. As a result, Democrats refused to recognize one Republican — Colorado Springs Rep. Scott Bottoms — for the rest of the day, meaning he wasn’t able to speak at the chamber’s mic.
Gov. Jared Polis called the special session in the aftermath of Proposition HH’s failure this month. The Democratic majority had hoped for a three-day gathering to hammer out some form of property tax relief as well as other proposals they argue will ease the rising cost of living in the state.
Republicans had led the charge against Proposition HH and cite its near 20 percentage-point loss as evidence voters don’t support Democratic priorities that echo proposals in that measure — and that they don’t want their tax refunds messed with.
Democratic leaders argued the proposition was too big and complicated to divine a single intent from voters, and that their new property tax proposal doesn’t tap into the refunds. And with majorities in both chambers, Democrats shot down Republican proposals and forged ahead with their own, including an increase to tax credits for low-income workers, more money for emergency rental assistance, and equal refunds, regardless of income level. Here’s where those proposals stand as of early Saturday evening.
Immediate property tax rate reduction
The most contentious bill of the session – the one that led the Republican minority in the Senate to throw down a gauntlet on its first night – passed a key voice vote in the chamber that all but secured its passage. A formal vote still needs to happen Sunday, and then it needs to work through the House.
Democratic sponsors said they were able to stretch the $200 million previously set aside for property tax reduction a touch further than earlier projections. The amended proposal increases the value reduction for tax purposes from $50,000 to $55,000. It would save the owner of a $500,000 house, with an average mill levy rate, about $28 more a year, for a total of about $255 reduction in their annual property tax bill.
It also widens the criteria for local taxing districts that would qualify for full reimbursement of lost property tax dollars because of state cuts to the formula.
Republicans still fought the bill as much as they could from the minority position, arguing the state should instead dip into reserves to pay for property tax changes and past bills that used TABOR refunds to ease property taxes should be reworked.
Free summer meals for children of low-income families
While property taxes have dominated the conversation in the Capitol, the special session also is poised to allow Colorado to claim first-in-the-nation status for a $42 million summer meal program for children in low-income families. It would cost the state $6.7 million, and the program would begin next summer.
The federal program provides a $40-per-month food stipend for three summer months when children aren’t in school. The federal pool would pay for the stipend for up to 350,000 children. The state would need to establish criteria and an outreach program as part of the bill.
The bill also represents a moment of near-unanimity during what’s been a rancorous special session. The House still needs to consider it, although it’s not expected to raise temperatures there.
“This policy is an example of when two opposing parties can work together, how you can accomplish good things,” state Sen. Rachel Zenzinger, an Arvada Democrat and sponsor of the bill, said. “It does stand a little apart from some of the noise down here, which is more exciting and gets more attention. For me, it’s a little bit of hope that we can still continue to function as the state government as opposed to the intractable mess that you see at the federal level.”
As part of a broader commitment by Democrats to expand this special session’s relief beyond just property owners, the House green-lit a bill that would set aside $30 million in rental assistance to help keep at-risk renters from being evicted through the first six months of 2024.
Under the bill, renters below 80% of their area’s median income would qualify if they were at imminent risk of eviction or displacement. As the federal aid has dried up, evictions have shot up in Denver and across the state. Advocates have said those trends have led to increased homelessness.
If passed, that addition would be a big boost: It would nearly double the state’s rental aid budget, bumping it to $65 million. That’s still shy of the approximately $20 million the state was distributing every month in rental assistance during the pandemic, although that money largely came from federal pandemic stimulus.
The money from the bill would be distributed by nonprofit groups to landlords. The state would have to dole out the cash to those nonprofits before June 30, when the state’s fiscal year ends.
“People across the state live on the brink and are one job loss away, or one emergency away, from losing the roof over their head,” said Rep. Mandy Lindsay, an Aurora Democrat and the bill’s cosponsor.
“We can do something about it, right here, right now.”
Expanded tax credits
The bill passed by the House on Saturday expands the state’s match of the federal Earned Income Tax Credit. As it stands, working and lower-income Coloradans get a 25% match on their federal EITC. For next year only, Democrats are proposing to spend $185 million in TABOR surplus money on upping the state match to 50%.
To put it in simple numbers: If you get a $4,000 federal tax credit under the program, this bill would mean the state would add an additional $2,000. Currently, the match would be $1,000.
The increase would benefit more than 400,000 families in the state, according to one of the House sponsors, Rep. Mary Young. Eligibility depends on how much you earn, how many children you have and whether you’re filing your taxes alone or as a joint filer. But generally it applies to lower-income workers.
Equal tax refunds
Another plank in the Democrats’ spread-relief-around platform: flattening TABOR for all income levels next year. That would do away with the six-tier system temporarily, giving a boost to most taxpayers in the state.
Exact figures are up in the air because the tax credit measure would affect the size of the TABOR surplus and, thus, the size of the checks. But Sen. Nick Hinrichsen, one of the bill’s sponsors, said Friday that the refunds would be more than $800 per recipient. His cosponsor, Sen. Janice Marchman, said the increase would benefit nearly 90% of single taxpayers and more than 50% of joint-tax filers.
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