Politicians, including Colorado Gov. John Hickenlooper, want voters in November to approve a massive, historic and permanent billion-dollar-a-year tax increase that will raise income tax rates of middle-class wage earners from 4.63 percent to as high as 5.9 percent. It could be a hard sell, to say the least, but politicians tell us it's all for the children. It's an education tax, they insist.
The progressive tax, which would do away with Colorado's fair and enviable flat tax, would cost almost $600 each year for a family living on $100,000. For someone earning $45,000, the cost would be $166.50.
Most decent human beings care about children and value education, so perhaps they'll think a giant wallop to Colorado's economy, along with a hit to household budgets, makes good sense. Anything for the children.
Just make sure the politicians prove it. Make sure this money will go for education before even considering a vote in favor of something that will tax Colorado incomes at a rate higher than is paid in more progressive states, such as Michigan, Massachusetts and Illinois. Understand that voting to take an additional $1 billion a year out of Colorado payrolls will be a gift to flourishing states, such as Texas and Wyoming, that charge no income tax and try to lure talent and employers away from Colorado on that basis.
When seeking proof this money will go for education, demand to know how many more teachers the money will fund. Demand to know what new schools will be built and what new programs this will fund. Tell the politicians that you will fund a good cause, so long as you know exactly what the money will pay for. Don't settle for words alone. Be certain this ballot measure, and the school reform bill that it connects to, contractually guarantee the annual $1 billion-plus will go directly to classrooms and teachers.
In demanding this information, Coloradans are certain to find that politicians can make no such assurance. That's because the education finance bill, which kicks in only upon approval of this enormous tax, does almost nothing to protect these funds for education. As explained by State Treasurer Walker Stapleton - who probably understands state finance better than anyone else in state government - the money can be used for almost anything the legislature and governor want. He suspects it will be used to backfill the underfunded Public Employees' Retirement System (PERA), which is on a financial collision course. If he is correct, the tax increase will fund lavish pensions -not classrooms and teachers. We need to fix PERA, so it can meet its contractual obligations, but not with a tax hike fraudulently sold as a way to improve education for our kids.
Another concern with this tax is the dirty little secret of state government's true financial condition. State politicians say they desperately need more cash for education, yet they've been rather silent about $1.1 billion in excess, unanticipated revenues for the 2013-14 fiscal year.
As explained in today's Gazette by reporter Megan Schrader, state politicians find the government awash in unexpected cash because of the state's rebounding economy. State politicians spent more than half the surplus, as detailed in Schrader's report, and only 1.2 percent went for K-12 per-pupil funding. That tells us a lot about the level of commitment the controlling party has to public education. Given a windfall that's about the same amount as anticipated annual revenue from the proposed tax hike, they declined to spend any meaningful amount on K-12 education. We might expect more of the same from the desired "education" tax.
"We were willing to spend things on K-12 education and there was no interest in the Democrat's side to do any of that, they wanted more taxes," said Sen. Kent Lambert, a Colorado Springs Republican who sits on the committee responsible for drafting the state budget.
At this juncture, it's hard to trust the stated purpose of the massive new tax proposal. Simply calling it an education tax won't make it so. If they can't prove it, prepare to vote "no."