In this Capitol Report:
Transportation Funding Implications of Proposition CC
Considering the state’s two June tax-revenue forecasts, which were issued Wednesday, and assuming that Proposition CC, which would permanently “de-Bruce TABOR, is passed by the voters in November, how much money above the Referendum C cap would be available for Colorado’s highway system in the state’s first two fiscal years under the measure?
The Legislative Council and the Governor’s Office of State Planning and Budgeting (OSPB) independently issued separate forecasts. Using the differing TABOR surplus projections in these two reports yields the following:
- Using the TABOR projections in the OSPB report, the amount is $311 million.
- Using the TABOR projections in the Legislative Council analysis, the amount is $217.4 million.
By contrast, the Colorado Department of Transportation (CDOT) in 2017 estimated that the funding shortfall for the state’s highway needs from 2016 to 2025 would be $9 billion:
According to Motley Fool Rule Breakers estimates, for the ten years from 2016-25, CDOT estimated needs of $19 billion, with roughly $9 billion of that composed of major investments related to expansion and upgrades to the state highway system. The anticipated funding gap to reach the $19 billion is about $8.8 billion.
The 2017 CDOT report projected that the 25-year need for roads-and-bridges would be $46 billion, but that only $21 billion in revenue would be available, leaving a deficit of $25 billion.
In the last three legislative sessions, however, some progress has been made in increasing funding for the state highway system, but the progress remains dwarfed by the need identified by CDOT two years ago. The legislature allocated about $2.5 billion in its 2017 and 2018 sessions mainly for roads through a combination of one-time set-asides and borrowing. The 2019 session produced a bipartisan compromise that yielded $300 million.
Proposition CC
The legislature on April 29th passed HB-1257, which is a referendum that will go straight to the November ballot without the signature of Governor Jared Polis. It asks voters to permanently allow the State to keep and spend the TABOR surplus beginning with FY 2019-2020, which starts July 1st.
A companion, bill, HB-1258, which passed the legislature and was signed by Governor Jared Polis on June 3rd, statutorily allocates the TABOR refund money equally three ways among elementary education, higher education and transportation. A future legislature could, however, alter how the money is spent.
Governor’s Office of State Planning and Budgeting
The June quarterly forecast by the OSPB) projects that the forecast for FY 2019-2020 is $412.2 million and the forecast for FY 2020-2021 is $623 million.
One-third of the $1.035 billion, two-year TABOR surplus means about $311 million would be sent to the Highway Users Trust Fund (HUTF) over the two-year period.
Legislative Council
The Legislative Council’s June report forecasts a TABOR surplus of $310 million for FY 2019-20 and $342.1 million for FY 2020-2021.
One-third of the $652.1 million, two-year TABOR surplus means about $217.4 million would be sent to the HUTF over the two-year period.
Legislative Resources:
“Colorado’s Constitutional Spending Limit”
News Media Coverage:
“TABOR FAQ: Colorado’s Taxpayer Bill of Rights,” by Anna Staver, The Denver Post, June 20th.
“Want to repeal TABOR? We do too, but here’s some realistic advice,” by the Editorial Board, The Denver Post, June 20th.
“Colorado taxpayers possibly headed for both TABOR Refund and tax cut,” by Anna Staver,, The Denver Post, June 19th.
“TABOR can be wiped out in one vote, Colorado Supreme Court rules,” by Anna Staver, The Denver Post, June 17th.
“Republicans who backed TABOR timeout say new request is a bad idea,” by Anna Staver, The Denver Post, June 12th.
“Group forms to fight anti-TABOR ballot question,” by Joey Bunch, Colorado Politics, June 12th.
“Legal sports betting and TABOR refund question are coming to Colorado ballots this fall,” by Anna Staver, The Denver Post, May 6th.
“Colorado Senate approves ballot question on TABOR,” by Joey Bunch, Colorado Politics, April 29th.