Statewide Funding Ballot Initiative Amendment 73 Gilpin County Re-1 - PowerPoint PPT Presentation

Statewide Funding Ballot Initiative Amendment 73 Gilpin County Re-1

Background Diverse and inclusive coalition of education-focused ● organizations began meeting in July 2016 to focus on the Colorado school funding crisis

Goals Raise additional revenue for education ● Distribute new revenue adequately and equitably ○ Ensure local benefit and local control over how revenue is ○ spent Provide a structural fix to the declining local revenue source ●

A73 creates the Quality Public Education Fund Supports and enhances the quality of preschool through twelfth ● grade (P-12) public education beginning in FY 2019-20 Contains revenue from a proposed income tax increase ● Is exempt from the TABOR revenue limit ● Must be used to supplement General Fund appropriations for ● P-12 public education Adjusted each year for inflation up to 5 percent ●

Raises $1.6 billion through income tax and corporate tax changes

Starts at federal taxable income above $150,000 Current With Amendment 73

Corporate tax on C Corporations will increase by 1.37% to 6%

Addresses the structural problem in the property tax system for education by permanently setting the residential assessment rate, currently third lowest in the nation.

Stabilizes the local share that continues to decrease as a percent of total school funding

Raises $1.6 billion to address local needs and ensures decisions are made at local level Increases base funding for all students ● Provides funding for full-day kindergarten and increases revenue ● going to early childhood education funding Expands the definition of “at-risk” students to count free and ● reduced lunch kids Significantly increases the amount of funds passing from the state to ● local districts for: Special Education , English Language Learners , and Gifted & Talented students Source: Legislative Council Staff

Local Impact and Various Scenarios

Gilpin County Re-1 Funding Shortfall Since 2009-2010 -$4.2 million Funding Shortfall 2018-2019 -$0.4 million New Revenue from Amendment 73 $0.8 million Funding Shortfall 2018-2019 B.S. Factor -$893 Increase in Per Pupil Revenue through A73 $1,718 MLOs Required to Raise this Revenue Locally* 2.5 District Capacity to Raise Per Mill $316,539 *Amendment 73 is a statewide effort to address school funding shortfalls. Local districts are permitted to raise additional revenue through local MLO elections, but there are limits to how much is allowed. Not all districts have the capacity to raise money locally to backfill the recent state funding shortfalls. The range for what 1 mill can raise is $5,000 to $16.5M in each of the 178 school districts.

Based on average income in Gilpin county Source: Income data is based on US Census Bureau

97% of Gilpin tax filers have income below $200,000 Source: Income data is based on US Census Bureau

Business scenario (not a C Corporation)

Farmer / Rancher scenario

Visit www.cosfp.org/impactcalculator to access the calculator

Impact on: C-Corporations Corporate State Tax Change for Federal Tax Change Public Schools Profits $50,000 $7,000 savings $685 increase $500,000 $70,000 savings $6,850 increase $2,000,000 $280,000 savings $27,400 increase

Additional Information on C Corporations ● Businesses that pay corporate income tax are typically large businesses that operate across multiple states or countries. ● The change is expected to generate $229.4 million in budget year 2019-20. ● On average, the approximately 15,000 corporate income taxpayers with an income tax liability are expected to pay an additional $14,139 per year under the measure.

Arguments For and Against Against For The state needs a sustainable source of The measure imposes a tax increase without any ● ● revenue to adequately and equitably fund guarantee of increased academic achievement. public education. Increasing the state income tax rate could ● The measure provides property tax relief for ● negatively impact the state’s economy. Businesses business property owners, farmers, and will have less money to invest in their workers and ranchers who have paid an increasingly higher individuals will have less money to spend, save, proportion of property taxes compared to and invest. residential property owners. The measure complicates an already complicated ● One of government's most important functions property tax system. By creating one assessed ● is to provide children with a high-quality value for school districts and another assessed education. value for all other local taxing entities, the measure will lead to confusion among taxpayers Stabilizing the local share of required school ● and further complicate tax administration for formula funding and creating a dedicated state and local governments. source of state revenue for education provide The measure does not allow the state legislature additional flexibility for the state to use more of ● its general operating budget on other core to adjust the income tax thresholds to account for programs, such as transportation, public safety, inflation. and health care.

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