Thurlow to host TABOR meeting
Whether voters liked it or not, the Colorado Legislature addressed a big part of its budgeting issues during this year’s session.
While lawmakers took the hospital provider fee that funds health care programs out from under revenue caps mandated by the Taxpayer’s Bill of Rights, freeing up millions of dollars for other needs, it doesn’t solve the long-term problem, said Rep. Dan Thurlow, R-Grand Junction.
And if that problem isn’t addressed, Thurlow said local governments won’t like where the Legislature may turn next to balance its budget: severance taxes.
“It will be an issue again,” he said. “The severance tax contributes to the issue in the same way as the provider fee did.”
That tax is paid by the extraction industries who mine the state for oil, gas, coal and other minerals.
Half of the money goes to fund the Colorado Department of Natural Resources. The other half goes to local governments, either directly or in the form of grants from the Department of Local Affairs to pay for impacts from that extraction.
Over the past few years, while the Legislature struggled with what to do about the provider fee, lawmakers diverted millions of dollars in severance taxes to other purposes.
For the most part, those dollars were diverted to help cover budget shortfalls during the recent recession. But in 2015, when state revenues were flush and severance tax collections were particularly high, money still was diverted because it forced the budget to hit the revenue cap.
Thurlow said Coloradans should make no mistake, state officials will again divert money from the severance tax in just a few years.
“When (the revenue) cap is small like now, it does not matter,” Thurlow said. “When it is large, like it will be in the next boom, it pushes us over the cap, and the tendency is to use (severance taxes) in the general fund rather than letting it go to DOLA or DNR.”
As a result, it is incumbent on state lawmakers who want to protect that money for local governments to have a plan to address the issue, such as passing a law preventing the tax from being diverted elsewhere, Thurlow said.
That’s why he’s scheduled a town hall meeting on the subject tonight. Thurlow said he will have experts on TABOR from the Colorado Fiscal Institute on hand to answer questions.
He said the event also will address the Gallagher Amendment’s impact on the budget. That 1982 amendment has greatly reduced residential property tax rates. While homeowners favor it, it also has reduced local funding to K-12 education, forcing the state to backfill an increasing amount every year.
“The goal of the town hall will be to foster some understanding and talk about possible solutions,” Thurlow said.