Lawmakers could strike a deal with tax-cutting advocates during a special legislative session this month, but the possibility is drawing pushback from groups including educators and local districts.
A pair of ballot measures proposed for this November would implement substantial cuts to property taxes and create a brand-new system to cap property tax revenues statewide.
But those proposed initiatives are drawing objections and concerns from lawmakers in both parties — along with plenty of disagreement about what they should do in response.
Now, Gov. Jared Polis and top lawmakers are negotiating with the tax cut organizers. If the legislature agrees to pass smaller tax cuts on its own, then the outside groups may cancel their ballot initiatives.
Rumors are flying, with details as specific as the exact dates that a special session could be held.
But as news broke of the negotiations, so did the pushback, with some affected groups warning that trying to negotiate a compromise on the fly could only end in disaster.
“Forcing through a decision on tax policy under these circumstances will result in problematic long-term consequences,” read a letter from the Special District Association of Colorado, an advocacy group for local taxing districts. “History has taught us that such decisions must be made with a comprehensive understanding and involvement from all stakeholders.”
Ann Terry, the organization’s executive director, called for more data on the new plan and warned that a special session might not prevent further battles over property taxes in future years.
Garry Briese, executive director of Colorado State Fire Chiefs, compared a special session to “negotiating with hostage takers.” Fire departments are among the many local services reliant on property taxes.
Both the ballot initiatives and the measures being negotiated now “will have very significant negative operational impacts on the ability of the fire service to meet the demands that it’s facing,” he said.
The Colorado Education Association also is pushing back, with a letter to the governor and other politicians stating that further rate cuts could destabilize school funding, as The Denver Gazette reported. The CEA also argued that the tax-cutting measures are unpopular and can be defeated at the ballot box. (CEA didn’t immediately respond to a request for comment.)
But those involved with the negotiations say the cuts could result in a more sustainable tax plan that averts the bigger changes that would come with proposed initiatives 50 and 108. Sen. Chris Hansen, a Democrat involved in the talks, has described the new plan as simply building on ideas passed by the legislature in May.
A draft proposal obtained by CPR News shows the plan would further lower the portion of home values that is taxed. It would keep future years’ tax rates closer to the discounted rates currently in place. And it would accelerate planned rate cuts for non-residential properties.
It also would expand a “cap” on property taxes that was implemented by the legislature. Right now, the cap puts a limit on how fast taxes can grow for local governments, creating a brake if property values increase too quickly.
The legislative proposal being negotiated now would also put a cap on property taxes paid to school districts, setting it at about 6 percent per year, though it could go higher if inflation rises. School districts and local governments could still ask voters to waive those limits.
The Colorado Municipal League, which represents cities and towns, hasn’t taken a position on the special session. Colorado Counties, Inc. hasn’t taken a stance, either.
Hansen said discussions with the outside groups have been productive.
“This is an important and reasonable discussion we’re having. The clear analysis shows (ballot initiatives) 50 and 108 would be deeply damaging to the state,” he said. “So if we’ve got a chance to avoid that outcome, that deserves careful thought.”
Supporters of the tax cut contend that with recent record growth in property taxes, local districts can afford a haircut, and they argue the state can help make up for any cuts — which budget writers counter would be extremely difficult, given the billions of dollars that could be at play.
Even as they negotiate, Hansen has pushed back on the tax cutters’ insistence on a special session. Hansen said that the changes being discussed won’t go into effect until Jan. 1, 2026.
“We have plenty of time to look at these changes and could put them all into effect [in the 2025 legislative session],” he said. “I think we can build confidence with each other and arrive at an agreement, without a special session.”
A document obtained by CPR News shows that Advance Colorado and Colorado Concern, the groups behind the ballot initiative, are gearing up for fall’s campaign season. The document claimed that the groups planned to spend about $8 million on the measures, which campaign runner Michael Fields confirmed was in line with his expectations.
Fields didn’t immediately respond to a request for further comment on the negotiations.
House Speaker Julie McCluskie said she was engaging with emergency services, school leaders and others. She called on the state’s new bipartisan property tax commission “to meet publicly as soon as possible to take additional feedback and evaluate the proposed framework to pull down the harmful ballot measures with a possible compromise.”
Senate President Steve Fenberg’s spokeswoman declined to comment on Wednesday.
- Why Gov. Jared Polis might call a special session on property taxes — for the second time in a year
- Deal, and no deal: Why one of the legislature’s biggest bills likely won’t prevent a ballot battle
- Big business and politicians are playing a game of chicken over property taxes
- Top Democrats, Republicans join together on 11th-hour property tax deal
