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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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Amendment 73 was designed to have no effect on other local governments. This legal opinion provides greater detail and explains why Amendment 73 would have no impact on the other local taxing authorities, such fire districts, libraries, cities and counties.

One of the best parts of A73 is that decisions on how it will be used are locally driven, made by local school boards.  Right now school boards across the state are telling their communities exactly what they would do with the money in the resolutions of support they are passing.  Because this is a grassroots effort with true local control, each community can see exactly what it means to their own school and hold their local school board accountable.  

Finally, A73 does guarantee that the money is spent on public education. The money goes into a protected fund for public education that can’t be raided by the legislature and is outside the TABOR limits.

There are over 900,000 public education students in Colorado, over 54,000 teachers for those students, and fewer than 2,500 administrators. Because the number of school administrators is so much smaller than the number of teachers and students, any increase to that number will proportionally seem much larger. Here are the facts:

  • Administrators make up less than 2% of district staff and the bulk of this category is made up of coordinators, managers, and directors, both instructional and non-instructional.
  • We need leadership in Colorado that focuses on the other 98%.
  • Many districts have been forced to add administrators to coordinate programs created by unfunded mandates.  These include teacher evaluation, the READ Act, Individual and Career Academic plans, etc.
  • The percent of special education and 504 students has increased significantly over the same 7-year period which has required additional administrators to run these programs.

Amendment 73 allows decisions to be made at the local level, versus a one-size-fits-all mandate.

Colorado will maintain its status as a low tax state with the passage of Amendment 73.

  • According to the non-partisan Legislative Council, 92% of tax filers will not see an increase in their income tax
  • 3rd lowest property tax rates in the nation
  • 9th lowest corporate tax rate among the 44 states with such taxes
  • 10th lowest for income tax rates for those making up to $200,000
  • For business property owners, farmers and ranchers, there is a tax decrease of about 17% on their school property taxes

 

The A73 Impact Calculator is the best way to see what the passage of this statewide funding measure means to you and to your local school district. Visit www.cosfp.org/impactcalculator to learn more.

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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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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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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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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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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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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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.

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.

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.

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.

 

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.
Yes on Amendment 73 | Great Schools, Thriving Communities