Three key 2020 Colorado ballot measures are poised to have the biggest impact on funding for schools.
A Jeffco PEN interview with non-profit lobbyist Ed Bowditch provides a rundown of how Proposition EE, Proposition 116 and Amendment B would impact K-12 funding across Colorado and especially for Jeffco Schools.
2020 ballot questions
Proposition EE proposes a tax increase on tobacco and e-cigarette products, which would generate an estimated $294 million for the state budget.
Funding generated by EE would be dedicated to health and education, including preschool, the state education fund, and the rural schools fund.
Proposition 116 proposes that Colorado’s flat income tax rate be lowered from 4.63% to 4.55%, reducing the state budget by about $200 million annually.
If an individual makes $50,000 a year, the reduction would save them about $40 each year, explained Ed Bowditch, a state lobbyist who represents school districts, including Jeffco Schools.
However, a $200 million cut in the state budget would very likely include cuts to K-12 education, including cuts to Jeffco Schools funding.
Amendment B proposes repealing the Gallagher Amendment and freezing residential property tax rates.
According to the 1982 Gallagher Amendment, no more than 45 percent of all property taxes can come from residential property taxes. The remainder must come from non-residential or commercial sources. As a result, residential assessment rates have dropped from 21 percent in 1982 to only 7.15 percent, with farmers, ranchers, and businesses seeing their taxes increase due to Gallagher.
If Gallagher is not repealed, the residential assessment rate could drop from 7.15% to below 6% in 2021, which would result in an estimated $400 million drop in property taxes statewide, Bowditch said. That, in turn, could mean cuts to the general fund to the state and less money for schools statewide.
Amendment B also freezes the residential property tax rate at 7.15 percent, meaning that residential property taxes will not increase if Amendment B passes.
Watch on YouTube:
JPEN full length interview with Ed Bowditch
Wondering why Proposition EE, Proposition 116 and Amendment B will have such a big impact on Colorado schools?
First, each of Colorado’s school districts is funded through a combination of local funding and state aid. Locally, school districts receive funding through property taxes. However, property taxes cannot be increased without voter approval, due to the Taxpayer Bill of Rights (TABOR).
Lower enrollment projected for 2020-21, resulting in funding cuts
On the state side, the amount of state aid a school district receives depends on the number of students enrolled in that district, as counted by the district in early October.
State funding is adjusted based on a district’s size, cost of living and number of at-risk students, but the primary factor in state aid is always total enrollment.
The fewer students a district educates, the less funding it will receive. In 2020, many districts are expecting lower enrollment numbers than they had in 2019, Bowditch said.
“You have some parents who don’t want their kids going to school because they may have pre-existing health conditions, some parents who may have opted their children into an online atmosphere, maybe within their school district or maybe another online offering outside of the district,” Bowditch said. “
Sometimes, people want to be homeschooling their kids in this environment,” he continued. “So the numbers are going to be likely down in most school districts across the state.”
Colorado has established a provision to allow districts to use a multiyear enrollment average instead of a one-year enrollment to prevent drastic cuts when districts face enrollment drops. However, the provision does not completely shield districts from financial hits.
Colorado will face estimated $1.6 billion shortfall in 2021-2022
State aid for districts may also decrease as cuts are made to the overall state budget. According to Bowditch, K-12 education is the largest component of the state’s general fund, accounting for about 40 percent of the general fund expenditures.
State revenues depend on income tax and sales tax, which have both felt the pandemic’s effects as residents have experienced wage reductions and job loss. For fiscal year 2021-2022, current estimates suggest Colorado will face a $1.6 billion shortfall, requiring reductions at the state level, Bowditch said.
Vote by Tuesday, November 3rd at 7:00 p.m.
The ballots are out and the polls are open for voters in Jefferson County. To learn more about these ballot measures see the Colorado Blue Book online and visit VoteJeffco.com for information about submitting your mail-in ballot or where to cast your vote. Ballots are due by 7 pm on Tuesday, Nov. 3.