TABOR Emergency Tax

You may have heard a lot about an Emergency Tax recently in light of the fact the state is facing an approximate $4 billion shortfall in revenues.  It’s not something very many people know about, and one of the rare instances where our state legislators are allowed to impose a tax.

When Governor Polis declared a disaster emergency due to the COVID19 Pandemic, it also allowed for provisions within the state constitution and state law.  An “epidemic” is specifically included in the relevant definition of a disaster for the purposes of this section.

TABOR Emergency Provisions (dtd March 2020) authored by Legislative Staff Council’s Greg Sobetski, Principal Economist

The Colorado Association of School Boards recently sent this information to their members:

Under the TABOR provision of the Colorado Constitution, the General Assembly is  authorized to pass an emergency tax under the following conditions:

  • A ⅔ majority of the members in each chamber declares the emergency and passes the tax.  That would be 24 members in the Senate and 44 members in the House
  • Emergency tax revenue shall be spent only after emergency reserves are depleted, and shall be refunded within 180 days after the emergency ends if not spent on the emergency.  In 2020, this is approximately $440 million ($271 million in cash, the rest in buildings).
  • A tax not approved on the next election date 60 days or more after the declaration shal end with the election month.  If passed, the tax will expire at the end of November 2020.

The impact of the funding cuts to our schools will be devastating.  In addition to public education, this resulting crisis in fighting COVID19 has left our health care system short, higher education funding decimated, and many other services provided by the state will be slashed.

To reach the ⅔ vote in both chambers, would require a bi-partisan vote, meaning Republicans would need to support the measure in both the House and the Senate as well as Democrats.