FAQ's

Learn more about the Great Schools, Thriving Communities proposal or ask your own question, and we will post a response in this section.

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What is Amendment 73?

The Great Schools, Thriving Communities ballot measure builds on the successes of Colorado’s public schools by expanding educational opportunities for our students to prepare them for success in college, career and life. This initiative funds those expanded opportunities through tax increments on income earned above $150,000 and on corporations and ensures that decisions about how to use those new funds are made at the local level. To provide sustainable support for schools for years to come, it stabilizes the volatile local share of education funding by first lowering property tax rates and then freezing the rates, which are third lowest in the nation.

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What is the ballot language?

You can read the actual language at the Colorado Secretary of State website page listing 2017-2018 Initiative Filings, Agendas & Results. The Final Text and Fiscal Impact Statement documents are linked here for your convenience.

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How will the funds be distributed?

The initiative also plans for equitable distribution of the revenue raised. Unless and until the legislature creates a more equitable School Finance Formula, this initiative would:

  • Increase base funding for all students
  • Provide for full-day kindergarten and increase the amount of revenue going to early childhood education funding
  • Expand the definition of “at-risk” students to count free and reduced lunch kids
  • Significantly increase the amount of funds passing from the state to local districts for: English Language Learners, Special Education, and Gifted & Talented students

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How was the $150,000 federal taxable income line created and why not tax all income levels?

Creating a graduated income tax structure that begins at $150,000 in federal taxable income (income after exemptions and deductions) helps to address inequities in Colorado's current tax system.

It's important to note that, currently, all Colorado income and sales taxpayers are already supporting our schools. However, under our decades-old tax structure, it turns out that, when you combine both state and local taxes in Colorado, the lower your income, the higher percentage of your income you pay in taxes. In part this is the case because middle and lower-income earners tend to spend a much greater proportion of their income on consumption (especially spending on necessities) than do higher income households. This is only common sense: the person who makes 100 times the median wage does not spend 100 times as much on food, clothing or gasoline. (The Purple Book Of Useful Fiscal Facts 2018, Colorado Fiscal Institute)

Marginal tax increments like the one created by this initiative are designed to help offset this inequity by creating higher rates on top earners.

The following chart provides an overview of how the Great Schools, Thriving Communities tax increments fund the Quality Public Education Fund, while making the tax code more fair for hard-working Coloradans.

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Why not raise local taxes instead of state taxes?

Educating Colorado's children is the responsibility of all of us. Our schools being underfunded is a state-level problem, so we need a state-wide solution.

In addition, as school districts have attempted to address this locally, inequities are growing across Colorado. Because of factors outside of a district's control — property wealth and commercial/residential mix — the amount a district can raise through Mill Levy Overrides (MLOs) vary significantly. Put another way, school districts have no control over what 1 mill can raise.

The range for what 1 mill can raise is from a low of about $4,000 to a high of $13,000,000. The average dollars raised by 1 mill is about $500,000 and the median is $110,000. Therefore, a local school district's capacity to address the cuts they have received from the state through the Budget Stabilization (Negative Factor) varies greatly. The cuts made to districts also vary greatly across Colorado as depicted in this chart:

Revenue from property taxes has been shrinking, which has impacted school budgets. In 1982, voters passed the Gallagher Amendment to shield homeowners from large property tax increases as home values rose rapidly. Over time, residential property tax collections fell, meaning fewer local dollars were available for schools. This shifted more of the responsibility to finance education to the state. 

One way legislators have attempted to supplement school districts’ budgets is by increasing the amount of money local school districts can raise through the use of Mill Levy Overrides. Mill Levy Overrides (MLOs) are ballot measures that ask voters living in a specific school district to approve the collection of additional “mills” on property taxes, above what the state allows. The additional tax collection is then directly distributed to the voters’ school district.

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$1.6 billion seems like a lot of money. Why do we need so much?

It's important to remember that:

  • Colorado has 900,000 students. 
  • It takes over $830 million to just return our per pupil spending to levels that existed in 2010.
  • The $1.6 billion amount does not even return us to the national average.

Colorado school funding has dropped precipitously and due to this funding crisis, Colorado schools are experiencing teacher shortages, aging buildings, limited funding to operate programs, outdated curriculum, and cut backs on bus routes. Each school district has had to make its own adjustments to account for the revenue lost through the Negative Factor reductions since 2010.

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What about all the marijuana money?

It is a misperception that most of the marijuana tax revenue goes to K-12 education. The majority of funds go to the Marijuana Tax Cash Fund for healthcare, health education, substance abuse and treatment programs and law enforcement.

In 2017-18, only about $40 million in competitive grants is available for school construction and the districts are required to provide matching funds. In addition to this amount, about $30 million will go to rural schools in 2017-18. In this same school year, our schools are underfunded by about $830 million. 

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How are property taxes for other local governments impacted?

I represent a public library district, which largely is funded by local property taxes. I am hearing the language in ballot initiative 93 freezes the property tax reassessment rates. I find language in the ballot initiative about this, but it appears to only be so for property taxes pertaining to school districts and not other types of taxing districts. Is this so?

The measure only applies to property taxes levied by school districts. Property taxes levied by other local governments are unaffected by the measure. The calculation for the target percentage and the residential assessment rate will be determined by the assessed values used for all other local governments and is unaffected by the measure.


Why is the commercial assessment rate dropping from 29% to 24%?

The drop in the non-residential (commercial) assessment rate is about taxpayer equity, meaning those farmers and ranchers and land owners who have been locked in at 29 percent non-residential assessment rate, while the residential assessment rate has dropped from 21 percent to its current 7.2 percent, would see some tax relief. This change helps to restore the original intent of the Gallagher Amendment to provide balanced support for local government that has become distorted over the years.

The measure only applies to property taxes levied by school districts and all other local governments are unaffected by the measure.


Does this initiative increase funding for teacher salaries?

This initiative raises money that would go toward teacher salaries and all areas of school district budget. The Fiscal Impact Statement provides details on the distribution:

Education spending requirements. Beginning in FY 2019-20 and until a new public school finance law that meets certain criteria is enacted by the General Assembly, money in the fund must be used to:

  • increase the statewide base per pupil funding for P-12 public education to $7,300;
  • increase state funding for the following programs by at least the following specified amounts over FY 2018-19 levels:
    • " special education by $120 million;
    • " gifted and talented programs by $10 million;
    • " English language proficiency programs by $20 million; and
    • " preschool funding by $10 million;

The above increases are to be adjusted for inflation each year beginning in FY 2020-21.

In addition, the measure expands the number of kindergarten and at-risk students that receive funding through the state's P-12 funding formula. Specifically, the measure requires that:

  • at-risk funding include students qualifying for reduced price lunch; and
  • full day kindergarten funding be increased from 0.58 percent to 1.0 per full time equivalent student.

How do we know schools are using their funding wisely and not being wasteful?

I am a big supporter of educational funding but I also appreciate wise spending of the money we do have. It seems that schools spend money on things that are not needed, such as fancy jackets for kids in a sports team who go to state. One of the large ways money is wasted is with graduation location rentals. When I graduated high school we held the ceremony at the school stadium. Why are our school districts now throwing away money on a fancy location for a graduation event?! Or for a fancy prom location? Before we ask tax payers to contribute more (yes I believe this is needed) we need to show that our schools are using their funding wisely and can be trusted to not be wasteful with additional funds.

School district transparency websites provide details to the public on how public funds are spent in public schools. One can search any Colorado school district website to obtain detailed information. In addition, as Colorado is a local control state, each school district sets its budget with community and parent engagement. It is also important to note that school districts many times have community sponsors, foundation support or donations that go to school districts to cover the costs of community activities such as a graduation. Fees, grants and fundraising vary by school district and are a significant source of revenue for many school districts. Lastly, community values help shape and determine what the expectations are for various celebrations and recognitions.

The Fiscal Impact Statement for this initiative provides details on the reporting requirements and distribution of new revenue.

Reporting requirements. Within five years of when the money is first appropriated from the fund, the Colorado Department of Education (CDE) must contract for a study that includes how money from the fund was spent, and determine best practices for continuous improvement in student achievement. In addition, school districts that receive money from the fund must make certain information available on its website, including its mission, and current budget, audit, uniform improvement plan, and student achievement scores.

Education spending requirements. Beginning in FY 2019-20 and until a new public school finance law that meets certain criteria is enacted by the General Assembly, money in the fund must be used to:

  • increase the statewide base per pupil funding for P-12 public education to $7,300;
  • increase state funding for the following programs by at least the following specified amounts over FY 2018-19 levels:
    • " special education by $120 million;
    • " gifted and talented programs by $10 million;
    • " English language proficiency programs by $20 million; and
    • " preschool funding by $10 million;

The above increases are to be adjusted for inflation each year beginning in FY 2020-21.

In addition, the measure expands the number of kindergarten and at-risk students that receive funding through the state's P-12 funding formula. Specifically, the measure requires that:

  • at-risk funding include students qualifying for reduced price lunch; and
  • full day kindergarten funding be increased from 0.58 percent to 1.0 per full time equivalent student.

 


What is the tax and how does it affect corporations?

A – What is the tax %? B – Is this on ANY size corporation, even a Sub S (personal and small usually) or corporation that grosses or nets over a certain amount. C – Does the League of Women Voters have a position on this? D – Local districts would decide on teacher salaries still?

A – What is the tax %? 
 
Income tax. The measure creates an exception to the current law requirement that any new income tax law change require taxable net income to be taxed at a single rate. Specifically, the measure allows multiple tax rates to apply to individuals, trusts, estates, and corporations if the tax increase is approved by voters for the funding of P-12 public education. The measure then increases state personal income tax rates on federal taxable income by the following graduated rates, beginning in tax year 2019: 
  • 0.37 percent for income between $150,000 and $200,000; 
  • 1.37 percent for income between $200,000 and $300,000; 
  • 2.37 percent for income between $300,000 and $500,000; and 
  • 3.62 percent for income above $500,000.
B – Is this on ANY size corporation, even a Sub S (personal and small usually) or corporation that grosses or nets over a certain amount. 
 
The measure also increases the state corporate income tax rate for domestic C corporations and foreign C corporations doing business in Colorado by 1.37 percent beginning in tax year 2019. All revenue from this individual and corporate income tax increase is deposited in the Quality Public Education Fund and may be retained and spent without further voter approval.
 
S Corps are not impacted by the corporate tax.
 
C – Does the League of Women Voters have a position on this? 
 
Yes, the League of Women Voters has endorsed. All endorsing organizations are listed here.
 
D – Local districts would decide on teacher salaries still?
 
Yes, that is accurate.