Medical marijuana good for Colorado Springs? "Yes," says mayor -- and so is a TABOR time-out

Lionel Rivera, the Republican mayor of Colorado Springs, says his city has a chance to resurrect itself from pummeling budget cuts brought on by the recession and the state's tax law that limits the city's ability to fund its coffers.

The medical marijuana industry boon, among other things, is providing that opportunity, he says.

But while a much-needed surplus this year could revive dwindling ranks in the police and fire departments and renew slashed services like community pools and lost street lights, the challenge comes in convincing residents of the notorious anti-tax city to let the city hold on to the extra cash for the next three years.

"I don't think this community is 100 percent anti-tax," says Rivera, who announced Wednesday in his state-of-the-city address a proposed November ballot initiative to spend more tax dollars for city services, much like the state did with Referendum C in 2005.

"You just have to make a case," Rivera says. "I think people in this community, if you make a case, and you believe it will help, they'll vote for it."

But that could be easier said than done.

Colorado Springs is home to the controversial former state legislator Douglas Bruce, author of the Tax Payer's Bill of Rights (TABOR), which axed the ability of state and local governments to support their budgets through tax increases.

Ironically -- or some say predictably -- the largely conservative city has been among those most adversely effected cities since the economy tanked, garnering national attention earlier this year for the city council's decision to cut one-third of the Springs' street lights at night, as well as trash cans in neighborhood parks and some bus services.

"I think people in our community have seen the amount of cut backs we've had to make, and I think the citizens would like to get those services back," Riversa says.

An endorsement of Rivera's proposals by the Colorado Springs Gazette editorial board today is evidence the public will be receptive, he says. The Gazette called the proposed ballot initiative "a plan that could begin a much-needed restoration of trust and respect between City Hall and the taxpayers who pay for it."

Though there haven't been any cuts to the police force, Rivera says vacant spots left by retiring or departing officers have not been filled and, among other things, city parks "aren't as green as they used to be" as a result of cutbacks in watering.

"Probably more than anything else, I would like to build up our police force to where it was before the recession," Rivera says. "Those are the areas we can refocus on -- put people back to work."

Still, Rivera isn't wholly against TABOR. He says he believes that it gives the public the options it wouldn't otherwise have.

"If you make a case that you're going to spend their tax dollars prudently, they're going to vote for it," he maintains. But if the ballot measure falls flat, "we'll just have to live within the growth that the current TABOR law allows."

TABOR requires that any surplus in tax revenue be returned to the tax payers and that state and local governments can't hike taxes without voter approval -- an edict lauded by many fiscally conservative Coloradans who favor smaller government.

But in an economic recession, TABOR also ties the hands of elected officials to stem or recover from drops in budgets for basic public services. Because of TABOR, new incomes can't work against downward trends dubbed "ratcheting effects," where each year's budget base is smaller than the last.

Rivera says a three-year time-out when it comes to returning the new surplus to voters can work as a reverse ratchet for the next three years, effectively bringing the budget base near where it was before the economy fell.

"We have a sales tax revenue, believe it or not," Rivera says. And a good chunk has come from the medical marijuana industry there -- $72,000 was collected in the city and surrounding areas in April, the mayor says. He expects that new revenue stream to total more than $1 million by the end of the year.

Increased fees from utilities and other fees are also large contributors, he clarifies. But the city looks to collect even more revenue from 451 marijuana-related businesses there that purchased temporary permits because of a state-wide moratorium on the growth industry that went into effect this month.

From the $500-a-pop temporary permits alone, the city collected $225,000, the mayor says. And when the city finalizes its regulations on the industry -- they'll likely "mimic" Denver's regulations and fees -- those marijuana businesses will also have to purchase business licenses, which are "going to be substantially bigger than the permit."

With the new industry and unexpected revenues, Rivera says the city has an opportunity to bounce back without actually asking voters to increase taxes -- at least technically.

"It's not a tax increase," he argues. "We're just asking the citizens to let the city keeps what it generates."

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J. David McSwane
Contact: J. David McSwane