Senate Approves Bill to Provide Flat TABOR Rebates

HB23-1311 is part of legislative package to reduce property taxes; would send $661 TABOR rebates for single filers or $1,322 for joint filers if Prop HH is approved by voters in November

DENVER, CO – The Senate today approved one part of a legislative package to reduce property taxes and create a flat TABOR refund mechanism that will increase refunds for more than two-thirds of Coloradans, including all those making under $100,000.

If Colorado voters adopt Prop HH in November, HB23-1311 would require the TABOR surplus for FY 2022-2023 to be refunded equally to qualifying taxpayers. Colorado taxpayers could expect to receive a refund of $661 for single filers, and $1,322 for joint filers.

“We’ve worked hard to provide Coloradans immediate property tax relief through Prop HH that will save families across our state more than a billion dollars each year - but not everyone owns property, which is why we’re working to get them relief, too,” Hansen said. “This proposal will make TABOR refunds more equitable and directly benefit Coloradans by getting them bigger refunds when they’re needed most.”

“TABOR refunds should be equitable,” Hinrichsen said. “Flat TABOR refunds will ensure that hardworking Coloradans from all walks of life are supported fairly. We’re taking care of property owners through Prop HH, and this proposal will help give folks more financial freedom to fill up their tank, put food on the table, buy school supplies, and pay their bills.”

HB23-1311 is contingent upon the passage of Proposition HH, the measure referred to the voters by SB23-303. This legislative package lowers property taxes for homeowners and businesses, increases TABOR refunds for those making under $100,000, and protects funding for critical community services. Under the package, even after accounting for the portion of refunds that will backfill property tax reductions, Coloradans who make less than $100,000 can expect to see an increase in their TABOR refund if Prop HH passes.

Without this legislation, the FY 2022-2023 TABOR refund would be refunded by the six-tier sales tax refund mechanism, giving lower earners smaller refunds than higher earners. If voters do not approve of Prop HH in the November 2023 election, the six-tier mechanism will be applied to TABOR refunds; single filers that make under $50,000 per year would receive a TABOR refund of $454, while single filers that make over $270,000 would receive a TABOR refund of $1,434.

SB23-303 creates a long-term solution to prevent rapidly growing home values from causing sharp rises in property taxes, and creates limits that protect homeowners and businesses from steep unexpected increases in their property taxes.

Coloradans will vote on this package in November, and if approved, the proposal will provide major long-term reductions to property tax rates while delivering immediate savings on property taxes this year. Combined with property tax reductions the legislature previously enacted via SB22-238, this proposal will cut the average homeowner’s tax increase in half, saving $1,264 on average over the next two years. In total, this package would provide between $900 million and $1.6 billion annually in property tax relief for homeowners and businesses in Colorado. 

Other property tax relief and protections proposed in this plan include: 

• Reducing the residential assessment rate from 7.15 percent to 6.7 percent in 2023 and 2024, and continuing this reduction for primary residences.

• Incrementally reducing the business property assessment rate from 29 percent to at least 26.9 percent by 2032.

• Reducing the taxable value of residences by $40,000 in 2023 and 2024, and continuing this reduction for primary residences (not second homes or investment properties) in future years.

• Capping the growth in district property tax collections excluding school districts at inflation and allowing local governments to override the cap after giving notice to property owners.

• Protecting funding for public education and backfilling revenue to fire districts, water districts, ambulance, and hospital districts in areas of the state that aren’t growing as fast by dedicating a portion of the state TABOR surplus to backfill.

• Providing seniors who currently receive the Homestead Exemption a larger reduction of $140,000 and allowing them to continue to receive this reduction if they move.

HB23-1311 now moves to the Governor’s desk for approval. Track the bill’s progress HERE.