Constitutional Amendment: Understanding Tabor's Impact

The Taxpayer Bill of Rights (TABOR) is a constitutional amendment that restricts revenues for all levels of government (state, local, and schools). It was passed at the ballot in 1992 with 53.7% of the vote and amended Article X of the Colorado Constitution. TABOR limits the amount of revenue the State of Colorado can retain and spend, and requires voter approval for tax increases. It also narrows the state’s budget choices in responding to cuts in federal aid. TABOR has been the subject of legal challenges, with opponents arguing that it undermines the ability of Colorado’s representative democracy to function.

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The Taxpayer Bill of Rights (TABOR) was passed with a ballot in 1992

TABOR is a concept advocated by conservative and free-market libertarian groups, primarily in the United States, as a way of limiting the growth of government. It is not a charter of rights but a provision requiring that increases in overall tax revenue be tied to inflation and population increases unless larger increases are approved by referendum. Under TABOR, state and local governments cannot raise tax rates without voter approval and cannot spend revenues collected under existing tax rates without voter approval if revenues grow faster than the rate of inflation and population growth.

Revenue in excess of the TABOR limit, commonly referred to as the "TABOR surplus", must be refunded to taxpayers unless voters approve a revenue change. This has been referred to as "de-Brucing" after Douglas Bruce, the author of the amendment. The TABOR amendment has been described as the strictest spending and tax law in the country, and it has affected nearly every aspect of Colorado's tax and fiscal system since its implementation.

TABOR applies to every government in Colorado, including city and county governments, special districts, and the state itself. All governmental budgets and tax policies must adhere to the strict particulars of the constitutional amendment. The amendment has had a significant impact on Colorado's budget and public services, with rankings on critical public services plummeting in the years after its adoption. It has also been described as chronically underfunding crucial services and creating a complex tangle of local taxes.

TABOR limits the amount of revenue the State of Colorado can retain and spend

The Taxpayer Bill of Rights (TABOR) is a constitutional amendment that restricts revenue for all levels of government in Colorado. It is the only state to have adopted such a restrictive measure, which was approved by voters in 1992. TABOR limits the amount of revenue the State of Colorado can retain and spend by tying increases in overall tax revenue to inflation and population growth. Specifically, TABOR allows the state to retain and spend an amount based on the prior fiscal year's actual revenue or limit, whichever was lower, grown by Colorado inflation and population growth and adjusted for any "voter-approved revenue changes."

Under TABOR, state and local governments cannot raise tax rates without voter approval. Revenue in excess of the TABOR limit, commonly referred to as the "TABOR surplus", must be refunded to taxpayers unless voters approve a revenue change. This has resulted in deep spending cuts in critical public services, such as education and public health, and has created a complex tangle of local taxes. For example, Colorado teachers are paid only 65% of what other college graduates make in the state, and the state has fallen to the bottom of national rankings in providing children with full vaccinations.

TABOR has also narrowed the state's budget choices in responding to cuts in federal aid. For instance, revenues from the sale of marijuana that were supposed to be put toward schools or substance abuse program funding may now need to be returned to taxpayers under TABOR statutes.

While TABOR has been promoted in other states, it has faced opposition and legal challenges. Some see it as a way to limit the growth of government and ensure economic prosperity, while others argue that it chronically underfunds crucial services and hampers the state's ability to invest in its future.

Voter approval is required for tax increases

The Taxpayer Bill of Rights (TABOR) is a constitutional amendment that requires voter approval for tax increases. It was passed at the ballot in 1992 with 53.7% of the vote and amended Article X of the Colorado Constitution. TABOR limits the amount of revenue the State of Colorado can retain and spend, and it applies to every government in Colorado, including city and county governments, special districts, and the state itself. The amendment has been criticised for underfunding crucial services, hampering the state budget, and creating a complex web of local taxes.

TABOR requires that increases in overall tax revenue be tied to inflation and population increases unless larger increases are approved by referendum. State and local governments cannot raise tax rates or spend revenues collected under existing tax rates without voter approval if revenues grow faster than the rate of inflation and population growth. Revenue in excess of the TABOR limit, commonly referred to as the "TABOR surplus", must be refunded to taxpayers unless voters approve a revenue change.

TABOR also limits the ability of the state to make prudent budget choices. For example, under TABOR, a state can only maintain or expand health and other services for the elderly by cutting other areas of the budget, such as education. Colorado's national rankings in critical public services, such as K-12 spending and college and university funding as a share of personal income, have plummeted in the years since TABOR was implemented.

Proponents of TABOR argue that it has contributed to Colorado's economic prosperity by limiting government spending and taxes. They also point out that voters have the power to approve revenue changes and override TABOR restrictions through referendums, such as Referendum C in 2005, which allowed the state to retain and spend all revenue collected for several years. However, opponents argue that TABOR has negatively impacted the state's ability to invest in its future and provide crucial public services.

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TABOR severely limits states' revenues and their ability to make budget choices

The Taxpayer Bill of Rights (TABOR) is a constitutional amendment that was passed in Colorado in 1992. It is a concept advocated by conservative and free-market libertarian groups, primarily in the United States, as a way of limiting the growth of government. TABOR severely limits state revenues and their ability to make prudent budget choices.

TABOR restricts revenue for all levels of government (state, local, and schools) and does not allow state and local governments to raise tax rates without voter approval. It also limits the amount of revenue the state can retain and spend. Specifically, TABOR allows the state to retain and spend an amount based on the prior fiscal year's actual revenue or limit, whichever was lower, grown by Colorado's inflation and population growth. Revenue in excess of the TABOR limit, commonly referred to as the “TABOR surplus”, must be refunded to taxpayers unless voters approve a revenue change.

TABOR has had a significant impact on Colorado's public services, with the state's national rankings on critical public services plummeting in the years after it was adopted. For example, Colorado fell from 35th to 49th in K-12 spending as a percentage of personal income between 1992 and 2001. The state's college and university funding as a share of personal income also declined, from 35th in the nation to 48th by 2008. Additionally, Colorado fell to the bottom of national rankings in providing children with full vaccinations.

TABOR's inflexibility has also led to crucial services being underfunded, hampering the state's budget and creating a complex tangle of local taxes. For example, the combination of TABOR and the 1982 Gallagher Amendment, which aimed to distribute taxes equally between residential and commercial property, resulted in a loss of $340 million in property tax revenue for the state in 2019 alone. This has had a significant impact on teacher salaries in Colorado, with teachers in several districts going on strike between 2018 and 2019 due to low pay and increasing costs of living.

While TABOR has had some support, with proponents arguing that it has contributed to Colorado's economic prosperity, there have also been attempts to mitigate its effects. Referendum C, approved by Colorado voters in 2005, allowed the state to retain and spend all revenue collected for a five-year period, loosening many of TABOR's restrictions. However, despite these efforts, TABOR continues to severely limit state revenues and the ability to make budget choices in Colorado.

TABOR is considered the strictest spending and tax law in the US

The Taxpayer Bill of Rights (TABOR) is a constitutional amendment that limits the annual growth in state revenues or spending to the sum of the annual inflation rate and the annual percentage change in the state's population. It is considered by some to be the strictest spending and tax law in the US.

TABOR was passed at the ballot in 1992 with 53.7% of the vote. It is a provision requiring that increases in overall tax revenue be tied to inflation and population increases unless larger increases are approved by referendum. Under TABOR, state and local governments cannot raise tax rates without voter approval and cannot spend revenues collected under existing tax rates without voter approval if revenues grow faster than the rate of inflation and population growth. Revenue in excess of the TABOR limit, commonly referred to as the "TABOR surplus", must be refunded to taxpayers.

TABOR has had a significant impact on Colorado's tax and fiscal system, with the state's national rankings on critical public services plummeting in the years following its adoption. For example, Colorado fell from 35th to 49th in the nation in K-12 spending as a percentage of personal income between 1992 and 2001. Additionally, TABOR has narrowed the state's budget choices in responding to cuts in federal aid, and it has resulted in low pay and increasing costs of living for teachers in several Colorado districts.

Opponents of TABOR argue that it simplifies complex tax decisions and that the "Population Plus Inflation" formula does not accurately reflect the cost of providing state services. The impact of TABOR on government spending and economic growth has been a popular discussion topic in recent years, with proponents accrediting much of Colorado's economic prosperity following the law's adoption to its limiting effect on government spending and taxes.

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