DENVER–Couched as a state education funding effort, legislation to siphon off overcollected revenue that would otherwise be refunded to Colorado taxpayers passed out of a Democrat-controlled Senate committee on Thursday.
Senate Bill 26-135, “State Public K-12 Education Funding,” refers a question to Colorado’s November ballot to increase K-12 education funding by 2% annually for the next ten years. According to the bill, the money is intended to go towards teacher pay increases and retention, lowering class sizes, and technical career programs.
Along with raising education appropriations, the bill allows the state to keep and spend excess revenue collected above the limitations in the Colorado Taxpayer’s Bill of Rights (TABOR).
TABOR, among other things, limits the growth of a portion of the state budget to a formula of population growth plus inflation. The state is required to refund revenue collected over the limit back to taxpayers. While SB-135 asks voters to give up their refunds for the foreseeable future, recent polling shows TABOR remains quite popular among active voters, with a 61 percent approval overall.
While Democrat sponsors are selling the bill as a funding boost for Colorado schools, only a portion of the money retained is actually required go towards K-12 education.
According to the bills fiscal note, appropriations would increase by 2%, on top of the current $10 billion dedicated to K-12 education. Projecting that the state will rake in up to $817 million in excess revenue, only a little over $203 million will be used strictly for education funding in fiscal year 2027-28, leaving around $600 million available for other purposes.
“Because SB-135 allows the legislature to retain excess money that does not need to be applied to education, it is almost certain that legislators will use most of the excess revenue as a temporary band-aid for rising healthcare costs,” Independence Institute* fiscal policy analyst Nash Herman told Complete Colorado.
The bill creates an excess state revenue account, and mandates the state auditor to publish a report, including the amount of excess revenue kept by the state and how it was spent.
SB-135 was introduced March 5 by Sen. Jeff Bridges and Sen. Cathy Kipp and was passed by the Senate Finance Committee on March 12. Three amendments were made to the bill, including language adjustments and substitutions. The Senate Appropriations Committee will hear the bill on March 20.
“Colorado is already spending more than ever on education despite declining enrollment and stagnating academic results,” Herman concluded, “Somehow, legislators claim that eliminating Coloradans’ TABOR refunds without addressing the drivers of unsustainable budget growth will magically improve education and fix the budget. It will not. Coloradans will keep less of their hard-earned money and have less say in what their money is spent on.”
