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Colorado ‘TBD’ Initiative Calls For Tax Policy Changes

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Colorado State Capitol (credit: CBS)

Colorado State Capitol (credit: CBS)

DENVER (AP) – Colorado residents heard the results of Gov. John Hickenlooper’s “TBD” government spending initiative Wednesday in a report that said the way the state raises and spends money must change.

Republicans remain skeptical of the process as an attempt by the Democratic governor to lay groundwork for tax increases, and the GOP’s incoming state House leader suggested such a move would jeopardize economic recovery.

The report from the TBD Colorado Initiative calls for changes in tax policies and constitutional provisions that it says are conflicting and serve to limit how much money the state can raise and spend – conclusions that Republican detractors of the initiative long predicted.

The report said the state’s economic path is “unsustainable.”

Greg Maffei, board chair of the initiative, said the state has a “structural problem” with its tax system. He said that in some cases state voters might chose to have fewer services or seek ways to eliminate wasteful spending, but in other instances “they’re going to need to make choices about where the revenue comes from.”

The “To Be Determined” group met with Colorado residents in 60 meetings around the state over the past year to talk about how government should prioritize spending on areas including education, transportation and health care.

The group focused on changing fiscal policy and the Colorado Constitution, specifically examining the Taxpayer’s Bill of Rights, which restricts spending and taxes; Amendment 23, which calls for minimum funding for K-12 schools; and the Gallagher Amendment, which affects property taxes.

“In recent years, the state’s revenues have not kept pace with the underlying growth in the Colorado economy because many of the fastest-growing sectors are either exempt from tax or taxed at a lower rate than other sectors,” the group said in its nonbinding report.

It also called for broadening the tax base.

Republicans have argued all along that the initiative was nothing more than a maneuver to pitch tax increases to voters and that the group should focus on making state government more efficient.

Colorado Springs Republican Rep. Mark Waller, who will lead the GOP in the House next session, said his party wants to work with Hickenlooper “in a bipartisan manner,” but he questioned the wisdom of considering tax increases while the economy is still recovering slowly.

“I don’t understand why we would be looking at that right now,” Waller said, adding that he believes raising taxes could stall economic progress.

Hickenlooper said voters would have the final say.

“In a number of places, not everywhere, but in a number of places you saw folks that were more aggressive talking about new revenues,” he said of voter feedback during the TBD initiative process.

The report called for more public engagement to identify potential constitutional changes. Also, it suggested the possibility of a new commission to periodically review the constitution to suggest changes to voters.

The group also called for legislation to expand preschool and full-day kindergarten and to increase home and community-based services in Medicaid.

The initiative had a budget of $1.2 million was funded by donations from individuals, foundations and corporations.

- By Ivan Moreno, AP Writer

(© Copyright 2012 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

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