Coloradans can expect two years of free college for qualifying students, long-term property tax reform after years of Band-Aid measures, and denser development following a legislative session that Democratic leaders called a “breakthrough” for many of their long-held policy goals.
A year removed from the bitter divisions and policy losses that marked the 2023 General Assembly, Gov. Jared Polis and Democratic leadership struck a notably more chipper tone as they heralded legislative victories on housing, gun reform, tax policy, and transit and education funding. Along the way, they also batted down several — but notably not all — looming ballot measures through legislation and handshake armistices.
It made for a “high note” to exit on, departing Senate President Steve Fenberg said. For Polis, it built toward the vision of Colorado he campaigned on in 2018 and 2022.
“We’ve gotten the pieces in place to really make sure that this powerful vision for Colorado’s future is becoming a reality,” Polis said at a news conference Thursday, the day after the 2024 legislative session ended.
Polis’ vision has not been entirely embraced by the historic number of Democratic lawmakers working in the House and Senate, both a floor above the governor’s office in the Capitol. But they found a kind of harmony as the progressive wing passed policies to reduce poverty and protect renters while Polis won concessions on his preferred supply-side housing solutions and tax cuts.
Republicans, who are outnumbered by Democrats nearly 2 to 1 in the Capitol, sought to seize their own victories over what they call Democratic excess. Senate Republicans distributed a list of bills that their members had joined with Democrats to kill, and their House counterparts praised the $450 million income tax cut sought by Polis and the $1.3 billion property tax cut compromise struck in the final days of the session.
“We have participated in crafting Republican-led efforts to reduce taxes on the income tax side and on the property tax side,” Senate Minority Leader Paul Lundeen, of Monument, told reporters Thursday morning. “We’re grateful that common-sense colleagues on the other side of the aisle joined in on many of those efforts.”
Here are four top-line takeaways from this session:
Colorado representatives cheer as they sing and celebrate during a recess on the House floor on the final day of the 2024 legislative session at the Colorado Capitol in Denver on May 8, 2024. (Photo by Helen H. Richardson/The Denver Post)
A comeback year for housing policy
This year, several novel policies — advanced elsewhere in the U.S. but foreign to Colorado — were resurrected after bitter deaths last year and crossed the finish line.
Lessons were learned from those failures: Almost universally, policies returned in narrower forms this time around. Sponsors were more willing to moderate and strike deals to advance core policy goals.
Chief among them was a slate of land-use reform measures backed by Polis and Democratic legislators, opposed by local governments and most Republicans, and the source of an acrimonious failure last year.
This year, the policy objective — reform local zoning rules to spur development — returned. But unlike last year’s 100-plus-page omnibus bill, this attempt was broken into component parts and scaled back. Support from affordable housing groups was shored up from the jump with improved affordability protections.
The most sweeping of the land-use bills — governing parking, density and accessory dwelling units — now largely apply only to Front Range cities and not, for instance, to the housing-constrained mountain communities.
The changes were a recognition of the political reality, if something of an unspoken break from the goal of a statewide solution to housing: Democrats may control the Capitol, but they are not a monolith. Still, all of the half-dozen land-use reform bills passed this year, a remarkable shift after last year’s disappointments.
“I personally supported versions of the bills that would have included more communities,” Polis said. “But I’m very happy that we were able to make the progress that we did.”
That tone was struck by supporters of other housing policies that were scaled back but passed this year. That included a slimmer version of the for-cause eviction protections measure that bled out on the Senate’s calendar 12 months ago, and a bill to give local governments a right of first refusal to buy for-sale subsidized housing. Polis vetoed a heftier iteration of that policy last June; legislators have said they negotiated technical changes in the bill with Polis’ office to ensure the governor signs the measure this time.
Supporters of both policies say they’ll play key roles alongside Polis’ preferred supply-side solution: Additional tenant protections will stop displacements, and preserving existing affordable housing will help protect existing supply as the development envisioned by the land-use reforms gets going in the coming years.
Colorado Sen. Barbara Kirkmeyer, center, speaks at the podium during tributes to fellow senators and legislative staff in the Senate on the final day for the 2024 legislative session at the Colorado Capitol in Denver on May 8, 2024. (Photo by Helen H. Richardson/The Denver Post)
Ballot threats drive policy
Some of the biggest policies to come out of the legislative session — on air quality and the oil and gas industry, property taxes and raising the cap on medical malpractice claims — emerged from debates with groups outside the Capitol as much as lawmakers knocking their heads together.
Threats of ballot measures have long been used as leverage over public policy. This year, they proved particularly potent.
“I like to say it’s the legislature for the billionaires,” Rep. Matt Soper, a Delta Republican, said of ballot initiatives. “They have found it’s relatively inexpensive to be able to put their pet pieces of legislation on the ballot and be able to drive it through.”
Soper called it “a real frustration” because it can mute the elected legislators’ debate over policy nuance. He, like other lawmakers, didn’t call for stopping the practice, “but I think it’s been used too much recently.”
While some of the legislation successfully brokered peace in brewing ballot box battles, it most notably did not on the question of property taxes. Colorado Concern, a nonprofit association of business CEOs, balked at the reforms in Senate Bill 233, the bipartisan bill to cut property tax rates and try to cap future spikes in tax bills, arguing it didn’t go far enough.
As a result, lawmakers are banking that voters will trust their work over the promises of initiatives 50 and 108. Initiative 50 has already been approved for the ballot and would institute a hard cap on how much property tax revenue can grow. Initiative 108 would severely ratchet down the state assessment rate and require the state to spend an estimated $2.25 billion to make up for lost local revenue amid a $3 billion overall cut to property taxes. Backers said they would start gathering signatures for the measure last week.
Scott Wasserman, president of the progressive Bell Policy Center, called the initiatives an “incredibly threatening and uniquely un-credible campaign” for how they would blow a hole in state and local services.
Fenberg predicted that the ballot this year will be one of the longest in state history as more initiatives qualify. It’s “a core part in Colorado’s democratic process,” but, he added, “you don’t have people filing literally 100 titles in one cycle without there being a question about if that’s actually in the spirit of the citizen initiative process.”
Unquestionably, ballot measures have been used to pressure policymakers, Fenberg said, though that doesn’t automatically make it nefarious.
Polis said opinions on the citizen initiative process tend to change depending on the outcome. Progressives love it when it delivers policies like paid family leave, while conservatives love it when it cuts income taxes.
Speaker of the House Julie McCluskie gives final remarks on the property tax bill, SB24-233, as Representatives Kenneth DeGraaf, left, and Ty Winter, right, listen during the final day for the 2024 legislative session at the Colorado Capitol in Denver on May 8, 2024. (Photo by Helen H. Richardson/The Denver Post)
Property tax reform and poverty-cutting tax credits
While the property tax proposal did not disarm the ballot measures to require deeper rate cuts, it nonetheless represents more than $1 billion in tax cuts across the states — if the initiatives fail in November.
It was the result of years of wrangling with property tax policy following the 2020 repeal of the Gallagher Amendment. That amendment functionally tamped down residential tax bills, but at the cost of a declining tax base for some local governments and special districts.
The new bill cuts the residential and commercial assessment rates for local governments beginning in the 2025 tax year, and deducts the first 10% of a property’s value, up to $70,000, from tax calculations beginning in the 2026 property tax year. The governor’s office estimates it will save homeowners $300 to $400 a year compared to current law, depending on local mill levies, without touching local school funding.
It was praised by Democrats and Republicans alike and earned bipartisan support in both chambers. It also marked a 180-degree turn from the last legislative session, when House Republicans walked off the floor on the final day of the session in protest of what would become Proposition HH, the 2023 tax reform measure.
“We are supportive of the work that we did in the legislature,” House Minority Leader Rose Pugliese, a Colorado Springs Republican, said. “We have put forward something we think the people can understand and will appreciate.”
But Republicans weren’t clear cut on their position on the initiatives that would undo that work. Lundeen, the Senate Republican leader, said he would support the initiatives to slow runaway government growth, while others said they were still weighing the measures.
Progressive Democrats also advanced a massive tax credit package that, supporters say, will cut child poverty in Colorado in half. The package includes a redo of an expansion of the state’s share of the earned income tax credit; another tax credit focused on lower-income families, totaling more than $1.4 billion over the next two years; and a third credit targeted at certain care workers, totaling more than $100 million in relief over the next three years.
To secure the tax credit for lower-income families, Democratic lawmakers had to strike a deal with Polis: In exchange for slashing child poverty, legislators agreed to a $450 million income tax cut this year, plus the potential for additional reductions, and even a sales tax decrease, in future years, depending on the size of the surplus.
The use of tax credits to pursue economic and political goals erupted this year, as legislators have grown accustomed to hefty surpluses.
Julie McCluskie, Speaker of the House, hits the gavel to the desk to end the 2024 legislative session on the House floor at the Colorado Capitol in Denver on May 8, 2024. (Photo by Helen H. Richardson/The Denver Post)
Free college, school funding and a new education formula
Colorado officials broke out friendship bracelets earlier this year to celebrate finally funding public education at the constitutionally required level for the first time since the Great Recession, sending thousands of dollars more to each classroom across the state.
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It marked a milestone achievement for lawmakers, many of whom said they dedicated their legislative careers to erasing the so-called budget stabilization factor. But the General Assembly didn’t stop its education reforms there.
The legislature, for the first time in 30 years, retooled the school funding formula with the aim of giving more money to rural school districts and those with higher numbers of students who are English language learners, in poverty or with special education needs. Lundeen, a sponsor of the bill to remake the formula, said it was about steering money to students, not school systems.
And that’s without getting to what House Speaker Julie McCluskie, a Dillon Democrat, called “the sleeper of the session”: A refundable tax credit that covers two years of tuition at in-state colleges for families making less than $90,000 a year.
“Being able to have access (to higher education) to fulfill your potential is so core to who we are as a state,” Polis said. “And of course, in addition to helping meet individual needs to live up to their potential, it will help make sure people have the skills they need to power our economic growth and fill jobs that we know are open today in the public sector.”
He called the legislature’s work on education policy this year the most productive of his six years as governor.
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