House OKs bill to counter Amendment 61 provision
A bill approved 56 to 9 by the state House of Representatives on Wednesday would provide school districts an alternative way to patch funding holes caused by cash-flow shortages if Amendment 61 passes on November’s ballot.
According to Senate Bill 205, the state provides about $471 million a year in interest-free loans to Colorado school districts with cash-flow issues. The loans are repaid by the districts within the same fiscal year they’re issued.
Amendment 61, which would limit state and local borrowing, would make it illegal for the state to issue these loans.
Senate Bill 205 would help school districts cover cash-flow deficits without state loans by allowing districts to ask voters for permission to issue bonded indebtedness. The bill would take effect only if Amendment 61 is approved by voters.
There are eight reasons a school district can ask voters’ permission to use bonds as a method for paying for specific uses, such as building schools. Amendment 61 allows for bonded debt as long as voters approve it, the debt is repaid within a decade, and the bonded indebtedness amount is no more than 10 percent of the assessed taxable value of real property in the district. Current law caps bonded indebtedness at 20 percent of the assessed taxable value of real property in a school district.
At a Western Slope superintendents meeting April 27 in Grand Junction, Colorado Association of School Boards Executive Director Ken DeLay said some schools on the Front Range would have to close without the state cash-flow loans.
DeLay said Amendment 61 and related measures on the ballot, Amendment 60 and Proposition 101, are “an attempt to undo all the things courts have done on TABOR.”
Amendment 60 would allow voters to approve decreases in property taxes and have K-12 school districts phase out half of their 2011 property tax mill levy rate that’s not paying off debt by 2020 and ask the state to replace that lost revenue each year.
Proposition 101 aims to step income tax rates down to 3.5 percent, decrease vehicle registration and license costs, and take local and state charges except for 911 fees off telephones, pagers, cable, television, radio, Internet, computer, satellite or other telecommunication services.
“I don’t know what we’d do if all three passed. I’m not sure what we’d do if one of them passed,” DeLay said.
Russ Haas of Golden and Michelle Northrup of Black Hawk are listed as the primary and secondary proponents for the initiative that became Amendment 61. Neither answered calls Wednesday afternoon at phone numbers printed on the initiative. The two said in a letter placed online at grass-roots conservative website ResistNet.com that their goal with the amendment is to have “a balanced state budget that protects all citizens from repaying overspending by irresponsible state politicians.”
“We are in a deep hole, doesn’t it make sense to stop digging?” the letter says.