MONUMENT • Although discussion was tabled for 30 days, Monument’s Board of Trustees last week reviewed an ordinance to permanently remove the ratcheting provision involved in Colorado’s TABOR Law as it applies to the town’s revenue.
Town attorney Andrew Richey presented the ordinance to the April 5 board meeting. Richey said Taxpayer Bill of Rights (TABOR) article 10, section 20, of the Colorado Constitution limits the town’s revenue and its use in a couple ways.
First, it requires board approval for all changes to tax rates which of course must be in compliance with the TABOR amendment, which Monument voters approve. Secondly, TABOR limits revenue with what’s known as a ratcheting provision which allows revenue to rise only so much based upon a state-wide statutory formula based on inflation and local growth. While the TABOR requirement for local federal tax rates cannot be altered locally, town citizens can vote to retain control over locally approved revenue by voting to not apply the statutory ratcheting formula.
This allows the town to collect and retain the revenue generated by voter approved tax rates. Richey said this voter-approved exemption is colloquially known as “De-Brucing,” referring to Colorado legislator Douglas Bruce who authored the TABOR amendment.
Richey said voting to approve local revenues exempt of the statutory formula has been very popular. In fact, most Colorado residents live in a municipality or a county which has voted to exempt local revenues from the formula in whole or in part, he said.
Monument voters have been asked if they wanted the town to be exempt from the statutory formula six times since 1996 and the measure has passed each time. Although it was initially thought to be required by state statute to ask voters to approve the exemption in four-year election cycles, Richey said case law shows the cycle is no longer a requirement.
The ordinance before the board would create a ballot for the voters to decide if the town is permitted to retain and spend the full amount of town revenues for the year 2020 and all years thereafter.
“For my experience, as it’s currently written, its vagueness and being too general, it’s too wide open,” Trustee Ron Stephens said. “I don’t think it’s going to be accepted by the citizens of Monument.”
Truste Laurie Clark agreed with Stephens and said a poll of her constituents found 89% do not want the ordinance to pass. “It’s my understanding from them that any overage from taxes collected, they would prefer to receive back as it’s their money,” she said.
The last time the issue was brought to Monument voters was 2015 and the four-year cycle would have called for the issue to be in front of voters in 2019. After four years, the town recalculates the tax base and the existing ballot initiative expires. Town manager Mike Foreman said because of COVID-19 pandemic prevention measures, the town was unable to have the initiative in front of voters.
“We are seeing if people want to keep ‘De-Brucing’ moving forward in the same way, just without the four-year timeline,” Foreman said.
Trustee Mitchel LaKind also voiced his concern of the ordinance and subsequent ballot language which would approve the exemption in perpetuity and “just going on forever.” He said there should be a start date and an end date.
“Why change the verbage now when the formula has worked for the citizens,” LaKinda said.
While it was unknown at the meeting if overages of the base has even applied to recent years of the town’s revenue, Mayor Don Wilson what the intent of the ballot initiative was if there were no overages to be exempt.
Foreman said the intent of this ballot initiative was, since voters have approved the exemption for the past 25 years, was to give voters a chance to save the town the costs of holding an election every four years to re-approve it. He said every four years the town may not have an election, but having one simply for voters to pass the initiative again could cost up to $15,000.
Foreman also said there was no calculation of overages readily available because the town has always been “De-Bruced” and staff hasn’t had to track the overages. He said he would gather that information over the coming week.
“It is required by the state for the voters to ‘De-Bruce ‘or not whether the situation happens or not,” Richey said.
Foreman noted the town staff had no position on the initiative and are simply following state law. He said the town would do whatever the board decided to do.
Clark said the board should get more community input and allow them the chance to be introduced to the idea and properly informed before moving forward on the ordinance. Foreman said there was no deadline on the ordinance if the board wanted to take more time to review it. Town clerk Laura Hogan confirmed ballot certifications were not due until September.
Mayor Wilson moved to postpone the ordinance for 30 days. His motion was approved unanimously.