Republicans Continue Cry for Emergency Property Tax Session as Prop HH Decision Nears

Thirteen days before Colorado voters will decide the fate of a ballot measure intended to mitigate upcoming property tax increases, state Republicans continued a futile push for an alternative solution.

Over a dozen Republican legislators gathered at the Capitol on Wednesday to demand a special legislative session dedicated to addressing rising property taxes — offering three potential bills to introduce. The move comes as the taxable value of the average Colorado home increased by 37 percent from 2022 to 2023, peaking at 81 percent in Pitkin County.

The result: major gains in property tax bills next year.

“I think we can hammer this out in a day or two if we have a special session,” says House Assistant Minority Leader Rose Pugliese. “We’re already working on solutions. This is basically our opening offer so that the local governments can come in with their solutions and then we can find a balanced middle ground that benefits all Coloradans.”

This is a familiar plea, with members of the state GOP repeatedly requesting a special session over the last five months, beginning in May, just days before the 2023 legislative session ended.

Wednesday’s request came less than two weeks before votes are due on Proposition HH.

The ballot measure seeks to reduce property tax rates for at least ten years, lessening future increases on property tax bills, though they'd still be higher than in previous years due to rising values. Prop HH would also make up for some of the lost tax revenue by spending money that would otherwise be returned to taxpayers via refunds from the Taxpayer’s Bill of Rights, aka TABOR. Some of the money would instead go to local governments, a rental assistance fund, school districts and the state education fund.

Representative Chris deGruy Kennedy, a Democrat who sponsored legislation to create Prop HH, called the Republicans’ latest ask for a special session a last-ditch effort to confuse Coloradans into voting against HH in November.

“They are trying to create a narrative so that people can vote 'no' on Prop HH thinking that there’s something better out there. And I’ll tell you what, I’m not sure there is,” deGruy Kennedy said at Wednesday’s event, where he was the only Democratic legislator present. “These are fundamentally unserious proposals [from the Republicans]. We have seen a lot of these ideas before, and the problem is there is never a pay for it.”

One of the GOP’s proposed bills would make the same property tax rate changes as Prop HH: lowering assessment rates to 6.7 percent for residential property and to 27.9 percent for most non-residential property. But Republican speakers said they would negotiate with local governments to potentially further decrease residential rates. And, most significantly, they claimed they would not use the TABOR surplus to backfill lost revenue — which is their primary complaint against HH.

The proposition would reduce TABOR refunds in future years by taking funds from the surplus, with the Common Sense Institute estimating that some Coloradans would miss out on over $5,000 in refunds over the course of ten years. But next year only, HH would make all TABOR refunds equal regardless of income, increasing refunds for those who make less than $99,000 per year and decreasing refunds for those who make more than $99,000 per year.

Wednesday's speakers said they could “reprioritize” the state budget to cover the lost revenue instead.

“It would end up being general fund monies,” Senator Barbara Kirkmeyer said during the event. “I don’t believe that Proposition HH is going to pass; I think it’s going to fail. … We have to have this relief this year, this calendar year, so that they can get the property tax relief next year. We can’t wait until January.”

Proponents of Prop HH argued that general fund revenue wouldn’t cover the property tax decrease in the long term. Plus, the Republicans’ other two proposals would still dip into TABOR refunds, as they criticized Prop HH for doing.

The group proposed two additional bills: one to make the Senior Property Tax Exemption portable (which Prop HH would also do) and increase the exemption from $100,000 to $200,000, and another to permanently reduce the state income tax rate from 4.4 percent to 4.0 percent. The first proposal would take money out of the TABOR surplus, and the second would result in less money going into the surplus.

“Time and time again, the far right has demanded that we cut taxes without paying for them — and demanding a special session two weeks prior to Election Day is just a distraction and a political stunt,” said Senate President Steve Fenberg, another Democratic sponsor of the bill to create Prop HH. “The far right’s alternative to cutting property taxes would inevitably devastate funding for classrooms and the first responders who keep us safe.”

Governor Jared Polis has previously made it clear that he does not intend to call a special session. In response to discussions of a special session in July, Polis said it was the voters’ turn to weigh in on the issue.

The governor can convene lawmakers to work on legislation regarding a specific issue outside of the regular legislative session, which runs from January to May. Polis most recently called a special session in 2020 to address the economic impacts of the COVID-19 pandemic.

The state legislature can also call itself into a special session, but it never has.

This would require a request from the Senate president and House speaker, and approval from at least two-thirds of lawmakers in each chamber. Republicans are unlikely to inspire that kind of agreement, holding only 31 of the 100 seats in the state legislature.

“While of course Governor Polis is always for a responsible tax cut, legislation can only offer a band-aid,” says Conor Cahill, the governor's spokesperson. “[Prop HH] is an ongoing solution with over $13 billion in savings for Coloradans. Allowing voters the opportunity to enact Proposition HH in November to save people money is the best way voters have to ensure tax relief for all Colorado families.”

Cahill declined to comment on whether the governor would consider a special session if Prop HH fails after voters cast their ballots on November 7.

If HH fails, even without a special session, Republicans said they plan to introduce their three proposals as legislation come January. But they’ll need support from the supermajority Democrats to pass anything. On Wednesday, the Republican speakers could only name one Democrat they’ve discussed the proposals with so far.