DENVER – More than 80 percent of Coloradans are paying more in property taxes now than they would have if the Taxpayer Bill of Rights had never passed according to a new study by Colorado State University.
Phyllis Resnick, an economist and lead author of the report, says TABOR has made mill levies and property taxes inconsistent and unfair across the state.
“When you go in and distort a system in the way TABOR has distorted school finance and made it increasingly unfair and increasingly unequal, over time there’s consequences to that,” says Resnick.
The report found TABOR’s tax and spending limits have forced the state to subsidize a handful of often-wealthy school districts. Resnick explains mill levies in a number of rapidly-growing districts have been permanently ratcheted down by nearly 100 percent in some cases.
She says the majority of Colorado taxpayers are left to back fill the artificial hole created by TABOR.
The study found TABOR’s property-tax limits rely on simple formulas that fail to take into account the complexities of school-district financing. Resnick says under TABOR logic, there’s no way the state can adjust to the impact on school enrollment and a diminished tax base when, for example, an oil-and-gas boom turns into a bust.
“What you end up with is very inflexible limits, particularly if they’re constitutional,” says Resnick. “Since you can’t anticipate everything that’s going to happen, you’re in a very weakened position to respond.”
Because it’s hard to predict all the unintended consequences when limits are placed on complex systems like a state budget, she says Colorado’s experience should serve as a cautionary tale for other states considering TABOR-like measures.