House Bill 1001 creates about $60 in property tax reductions for the average homeowner
Colorado voters will no longer vote on two ballot measures that would have cut property tax revenue statewide after the supporters of the initiatives removed them from the ballot as part of a bipartisan deal with state lawmakers.
Initiatives 108 and 50 would have lowered the assessment rates used to calculate property taxes and imposed a 4% annual statewide cap on property tax revenue growth, respectively. State budget experts said if approved by voters, the changes would have triggered draconian budget cuts for schools, fire departments and local governments.
The advocates for the measures, Advance Colorado and Colorado Concern, agreed to remove the measures and not bring similar ones for at least six years in exchange for the legislature cutting taxes themselves.
Despite frustrations from some lawmakers, the legislature approved the tax cuts under an earlier-agreed-upon deal during a special session last week as House Bill 1001. The deal was negotiated with only a handful of lawmakers and the proponents of the ballot measures before the four-day session began and barely changed during the legislative process.
Gov. Jared Polis signed House Bill 1001 on Wednesday, making the deal official just a few hours after the ballot measures were formally withdrawn.
In an emailed statement, Michael Fields, the president of Advance Colorado, celebrated the deal, saying his goal over the past two years has been to create a "significant and permanent" property tax cut and cap for future spikes.
"Today, Colorado taxpayers are the winners," according to the statement. "Coloradans across the political spectrum have made it clear that they need substantial and meaningful property tax relief. Today, that is what this new law delivers."
Gov. Jared Polis said the deal marked the end of a "property tax war" that has been waged ever since voters repealed the Gallagher Amendment, a constitutional amendment that prevented property taxes from growing too rapidly, in 2020.
"This tax cut builds on our efforts to lower the cost of housing in our state, ensuring life in Colorado is more liveable and affordable for everyone," he said in a statement.
House Bill 1001 created about $60 in property tax reductions for the average homeowner. That compromise built upon the bipartisan Senate Bill 233, which cut property taxes and was passed in the spring. Senate Bill 233 caused about a $400 decrease in property taxes for the average homeowner.
House Bill 1001 reduced the assessment rates used to calculate property taxes and limited how quickly property taxes can grow in the future. The cuts are still about $1 billion less statewide than if ballot measures 108 and 50 had been approved.
This was the legislature's third attempt at finding a long-term way to blunt rising property taxes.
House Speaker Julie McCluskie, a Dillon Democrat, had expressed frustration over the special session but ultimately called the compromise a win.
"Stopping these measures with small changes to the bipartisan property tax package from last session is a win for Colorado, our schools and local governments," McCluskie said in a news release.
The deadline to remove initiatives from the ballot is Friday.