Colorado's Battle for Property Tax Control: Prop HH vs. Initiative #50

In yet another property tax debate, Colorado voters could find themselves at a crossroads with two competing propositions.

While Prop HH claims to provide a straightforward solution for property owners statewide, a closer examination reveals its potential for complex and detrimental consequences to local communities - raising taxes and stealing TABOR refunds forever. Meanwhile, Initiative #50 emerges as a more pragmatic alternative, presenting a balanced approach to address property tax concerns.

Initiative #50 recently gathered an impressive 225,000 signatures in support. If deemed valid, Colorado voters will have the opportunity to cast their ballots on this important issue next November.

The crux of Initiative #50 lies in the introduction of a cap on property tax payment increases. This cap would kick in whenever property tax revenues are projected to grow beyond 4 percent annually statewide.

While this growth rate fluctuates due to various factors such as increased property values, new construction, and local tax approvals for essential services like education and public safety, the proposed measure seeks to maintain a reasonable limit on these increases.

Detractors of this cap argue that its implementation would create chaos due to variations in property tax rates across cities and counties. However, it is crucial to note that the Initiative does not specify how the state and local governments would address the cap's consequences. For instance, local governments may choose to provide tax refunds, while legislators could explore discounts statewide.

The proposed cap would result in approximately $115 million in revenue refunds by 2026, according to state fiscal analysts. While such refunds could present challenges, they are not insurmountable hurdles, especially when considering the long-term benefits of a fair and balanced property tax system.

In contrast to Prop HH's shortcomings, Initiative #50 offers a solution that strikes a balance between revenue stability and tax relief. It grants the state government the ability to seek a voter override on the cap in a statewide referendum. Should a majority of Colorado voters agree, property tax revenues would be allowed to grow at an unrestricted rate for that year.

By reintroducing revenue limits, Initiative #50 ensures that property taxes remain reasonable while respecting the decision-making power of local communities. It prevents fragmentation and assures that crucial choices regarding property taxes are not replaced by statewide decisions divorced from local contexts.

By voting down the rushed and many believe ill-conceived Prop HH, Colorado taxpayers would ensure they continue to receive their constitutionally granted TABOR refunds.

The proposed Colorado Prop HH may present a seemingly simple fix for property owners, but its flaws and potential harm to local communities are undeniable. On the other hand, Initiative #50 demonstrates a more sensible alternative, offering a balanced approach to effectively address property tax concerns.

Colorado voters may be asked to weigh the importance of preserving local decision-making while maintaining a fair and stable property tax system.