Colorado state senators on Wednesday pushed forward a property tax cut and rejected another measure that could have made it harder to pass future statewide tax breaks, even as opponents of the tax deal called it a “bipartisan farce” imposed on the legislature by “oligarchs.”

The third day of the special session of the House saw fierce opposition to a tax cut bill introduced by Gov. Jared Polis that would force supporters of two other tax cut initiatives, Initiatives 50 and 108, to withdraw their measures from the November ballot. But House Bill 1001 passed the House by a solid 45-18 vote and then passed the Senate Budget Committee unopposed before receiving preliminary approval in the upper house.

Meanwhile, the Senate Finance Committee has rejected a proposed constitutional amendment that would have required future statewide property tax changes to be approved by local governments before they take effect – a measure that could have derailed the negotiated deal. While House Resolution 1001 surprised some observers by passing the House by a 44-19 vote, sponsoring Senator Chris Hansen asked the committee to reject it, seeing no way it would pass in the more moderate Senate.

With those votes, the Legislature is on track to adjourn Thursday after only two of the 13 measures introduced in the special session are expected to pass — HB 1001 and a less significant bill to make a greenhouse farm equipment tax break permanent. Polis is then expected to quickly sign HB 1001, around the same time Advance Colorado and Colorado Concern file paperwork to withdraw Initiatives 50 and 108 from the November ballot.

House of Representatives leaders receive bipartisan support

House Speaker Julie McCluskie, the Dillon Democrat who co-sponsors HB 1001 with House Minority Leader Rose Pugliese of Colorado Springs, acknowledged after harsh criticism from her own caucus that the process for passing the bill was not ideal. Lawmakers passed a bipartisan $1.3 billion property tax relief bill, Senate Bill 233, in May, only to hear supporters of the initiative say it was not enough. They called for another $248 million in relief and a cap on statewide property tax revenues so they can cut rates 50 and 108.

But McCluskie said she did not risk passing those two initiatives, which would have reduced local and state government revenues by about $2.4 billion through tax cuts and led to significant program cuts. Instead, she sought a compromise. And she got it through the House on Wednesday, despite the no votes of 15 of the 46 Democrats and three of the 19 Republicans.

Colorado state representatives Rose Pugliese and Julie McCluskie are lobbying the House of Representatives on Wednesday to gain support for their property tax cut bill.

“I believe that passing this bill and removing these initiatives from the ballot was the most sensible thing we could have done,” McCluskie said. “What we are doing today is governing. Government is hard…decisions are hard.”

Despite their complaints about the comparatively much smaller tax relief that HB 1001 offered, she and Pugliese received major support from Republicans, many of whom supported the bill because it offers more help to people whose property taxes have skyrocketed. Rep. Marc Catlin, R-Montrose, said that by passing HB 1001, he could go home to his constituents and say that he and other lawmakers saved taxpayers a combined $1.6 billion.

HB 1001 further reduces residential property tax rates from the lower rates established in SB 233 and sets caps on annual property tax revenue growth statewide, with revenue for school districts allowed to grow slightly more. Advance Colorado and Colorado Concern have also agreed not to pursue any further property tax-related initiatives for six years if lawmakers pass the bill with the agreed-upon provisions.

A “fecal sandwich” served by “oligarchs”

McCluskie’s own party had tried unsuccessfully over the past two days to amend the bill to shift a larger portion of the property tax relief to owners of lower-value homes. Before the final vote, she expressed her frustration with the process.

Rep. Brianna Titone (D-Arvada) complained that the bill’s sponsors were using their initiatives to pursue their own interests in a way that was “nothing short of extortion.” She called the deal “a fecal sandwich… that they have to force on us.” And Titone ended up voting for HB 1001 anyway.

Rep. Elisabeth Epps, a Denver Democrat who lost her primary in June after clashing with a number of House Democrats, said the backroom deal simply shows voters shouldn’t trust the House, calling it a “bipartisan farce, as bipartisan as apple pie, baseball and racism.”

Colorado State Representative Stephanie Vigil criticized a bill to reduce property taxes in the House of Representatives on Wednesday.

But the biggest criticism came from Rep. Stephanie Vigil, who said the special session was called “because it was decided to negotiate with the oligarchs.” The Colorado Springs Democrat explained that people were suffering financially not because of high taxes, but because the owners of large companies refused to pay decent wages, raised food prices and then expected the state to give them the money back.

“When it comes to the ever-increasing profits of big corporations, there are no limits, no ceiling,” Vigil said. “That’s where all your money goes, Colorado. It goes to the oligarchs.”

Senators praise tax relief

The discussion of the bill in the Senate Budget Committee was quite different.

Sen. Barbara Kirkmeyer, the Brighton Republican who sponsored HB 1001 with Democrat Hansen, said that while she was pleased with the efforts in SB 233 – including lowering business tax rates from 29% to 25% – more could be done. She said she continues to hear from constituents about their pain after property values ​​across the state increased an average of 40% in 2023, driving up their property tax bills, so she continued negotiations with ballot proponents to see if there was a middle ground.

Mark Ferrandino, director of the governor’s Office of State Budget and Planning, said recent estimates show that property assessments statewide will increase by about 2.5% on average, which will be reflected in 2025 bills. Not only is that total far less than recent reassessments, but the additional revenue the higher values ​​generate should offset any revenue losses local governments incur from the reduced assessment rates in HB 1001, he said.

Erin Meschke, a Boulder County activist, disputed the narrative that the special session was forced to accommodate the wishes of wealthy interest groups that funded the initiative.

“There was a lot of talk about the wealthy initiating the ballot measures, but ordinary citizens wanted both on the ballot and signed the petitions,” Meschke said. Her biggest concern is that 200,000 signatories will now not be allowed to vote on Initiatives 50 and 108.

End of efforts to make decisions on property tax cuts locally

Jeff Bridges, chairman of the Colorado Senate Budget Committee, questions the sponsors of a property tax cut bill about the lack of involvement of two outside groups that helped draft the bill.

Democrats on the committee were far more concerned that neither Advance Colorado President Michael Fields nor Colorado Concern President/CEO Dave Davia appeared during the House or Senate hearings to testify on HB 1001. Chairman Jeff Bridges (D-Greenwood Village) held public testimony and asked if anyone from the groups would call. He and Hansen questioned education leaders who support the bill about why they believed the initiative’s backers would hold up their end of the bargain.

In an interview with Colorado Politics last week, supporters of the initiative suggested that passing HCR 1001 could cause them to scupper the deal. Opponents of the measure, such as Republican Rep. Don Wilson of Monument, said the vague requirement to get voters in cities, counties, special districts and school districts to explicitly recognize statewide property tax cuts at the local level would delay implementation of the tax breaks and confuse locals about why they would need to vote multiple times.

Supporters, including Democratic Rep. Mike Weissman of Aurora, who is supporting the proposal, said the proposal is simple: Local governments that levy and collect property taxes should decide how much they are, not state officials who don’t benefit from them. Kevin Bommer, executive director of the Colorado Municipal League, said many lawmakers who often cite the benefits of local control seemed oddly unwilling this time to give municipalities control of their tax dollars.

“The balance … is achieved”

But since passage of proposed constitutional amendments requires a two-thirds majority in each chamber — a hurdle that HCR 1001 cleared with the minimum possible number of votes in the House — and since Democrats control less than two-thirds of the Senate (and have several moderates in their caucus), Hansen saw the signs of the times. He and his supporters said he hoped this week’s brief discussion was just the beginning of more comprehensive legislative consideration of the idea in the future.

And it looks like by calling the special session, Polis may get the result he wants — additional property tax relief without the massive impact that Initiative 50’s 4% cap on revenue growth and Initiative 108’s further rate cuts would have caused. Sponsors have said the average tax relief each homeowner will receive as a result of HB 1001 is nearly $80, on top of the roughly $500 tax relief they will receive through SB 233.

“We believe that balance between providing relief to taxpayers and maintaining the quality of government programs that we need will be achieved,” said Henry Sobanet, chief financial officer of the Colorado State University System.