Gov. Bill Ritter Wednesday signed nine bills that end or suspend a variety of tax exemptions, mostly affecting business. The one that may be most noticed by consumers is a levy on soda and candy.
The measures, pushed through the legislature despite Republican opposition, are projected to raise $15.6 million in revenue for the current, 2009-10 budget year and $132.6 million for 2010-11, providing part of the answer for the state’s budget balancing riddle. They generally were backed by education groups who feared K-12 cuts would be even steeper without the revenue.
Cuts in state K-12 support could be $250 million to $350 million or more in 2010-11, depending on how you calculate it. Higher education is on target to take a $60 million cut in state and federal support, although increased tuition will maintain overall higher ed revenue at a bit more than current levels.
The legislature passed and Ritter signed the bills based on a 2009 Colorado Supreme Court ruling that certain taxes could be adjusted without voter consent, as would otherwise be required under the Taxpayer’s Bill of Rights.
The candy-and-soda tax is contained in House Bill 10-1191. The other eight measures involve direct mail supplies, fuels used in industry, a tax on some software, out-of-state retailers, some restaurant supplies, agricultural supplies, alternative fuel vehicles and net operating losses. Two other measures involving conservation easements and enterprise zones are still pending in the legislature.
0 for 2 on tax credit bills
As expected, the House Finance Committee Wednesday killed House Bill 10-1295, which would have allowed parents to take substantial tax credits for the cost of private schools and even for home schooling. The bill failed to advance on a 4-6 party line vote, and the committee Democrats killed it with a 6-4 vote.
It was the second such proposal killed by the panel in as many days. On Tuesday the committee dispatched House Bill 10-1296, a more limited proposal that would have allowed lower-income families to take smaller tax credits for private school tuition.
Wednesday’s victim, HB 10-1295, was sponsored by 25 Republicans and would have allowed annual credits of $500 for part-time and $1,000 for full-time home schooled students. Private school students would have been eligible for a credit equal to half of average state per-pupil aid to schools.
People who provided scholarships for private school students also would have been eligible for tax credits.
Legislative staff analyses estimated that even though the state would have lost income tax revenue because of the bills, it would have saved more in per-pupil aid to school districts. Local districts, of course, could have lost big money.
Such “voucher-like” bills are kind of ritualistic. Republicans, especially more conservative ones, like to introduce them to make a statement. But, they’re anathema to Democrats (and traditional school groups like the Colorado Education Association) so go nowhere as long as Democrats are in the majority.
In 2003, when the GOP controlled the legislature and the governor’s office, lawmakers passed a bill by Republican Nancy Spence of Centennial, then in the House but now a senator, that created a limited, pilot voucher program focused on at-risk students.
But, in 2004 the Colorado Supreme Court struck down that law, ruling it violated the school local control provisions of the state constitution.
Later that year Democrats took control of both houses, making vouchers and tax credits non-starters ever since.
For the record
The House and Senate both dug in backlogs of floor work Wednesday. Here’s what happened on education-related bills:
- House Bill 10-1026 – Incentive grants for quality childcare programs, House preliminary approval
- Senate Bill 10-081 – Creation of farm-to-school task force, Senate final approval
- Senate Bill 10-150 – Transfer of schools lands revenue to current K-12 spending, Senate final approval
- Senate Bill 10-059 – Tax check off for D.A.R.E. program, Senate final approval
- Senate Bill 10-111 – Charter schools ability to contract with BOCES, Senate preliminary approval
- Senate Bill 10-088 – Allowing community college academic majors, Senate preliminary approval
Use the Education Bill Tracker for links to bill texts and status information.