HB 1129, income tax surplus bill, clears House Finance Committee

Representative Rod Pelton, R-Cheyenne Wells, scored a bipartisan victory in the House Finance Committee on March 17, with approval of House Bill 1129.

The bill sets up a one-time income tax credit of surplus general funds — the dollars the state gets from corporate and individual income taxes and sales taxes — to taxpayers.

“This bill couldn’t come at a better time, with all the people hurt through shutdowns, businesses closed and the State realizing a surplus over and above what we thought we would get,” to the tune of $1.8 billion, Pelton told the committee.

Pelton said the bill is intended to direct the money to those who pay taxes. Pelton’s bill deals with the projected general fund surplus for 2021-22, a $3 billion pot of one-time money that lawmakers are planning to spend in the 2022-23 budget.

By sending those dollars back to taxpayers, it means the State cannot save that money for future obligations, according to the bill’s fiscal analysis.

Money would go back to taxpayers regardless of level of income, so even if someone was doing well during the pandemic they’d still get a tax credit, according to Rep. Matt Gray, D-Broomfield, who questioned why the bill doesn’t set up “means testing,” which would consider income levels.

The State is already planning to issue tax refunds through the Taxpayer’s Bill of Rights (TABOR) in the 2022 tax filing season.

The State uses a three-tiered system to issue those refunds: first, to cover the senior and disabled veteran property tax rebates; second, a temporary reduction in income tax and finally, a sales tax rebate, with whatever dollars are left.

According to the March 17 State revenue forecast, TABOR refunds for single filers is estimated at $95, a surplus from 2021 that will be paid this year. Next year’s rebate is estimated at $567 per single filers, from excess revenue in 2022. 

Esther Turcios of the left-leaning Colorado Fiscal Institute, said that while the State is mandated to issue TABOR refunds, lawmakers can ensure rebates, such as in HB 1129, will support families who are struggling to recover from the pandemic. Taxpayers with incomes above $250,000 would get $1,100 rebates but those with incomes of $45,000 would get a rebate of $481. Those who make fewer than $55,000 annually pay a higher share of income in State and local taxes, she said. 

Josh Mantell of the left-leaning Bell Policy Center also testified against the bill. The center isn’t opposed to income tax reductions, he pointed out. But “this bill locks in mechanisms to deliver money to the wealthiest Coloradans,” he said, but his organization is open to discussions on how to make the bill fairer to those who pay the largest portion of their incomes on taxes.

“One of our greatest needs is to get money back into people’s pockets,” Snyder said. “We could really use another set of eyes to look at this,” referring to the House Appropriations Committee, in explaining his “yes” vote.

HB 1129 won an 8-3 bipartisan vote from the finance committee and now heads to the House Appropriations Committee.

This week, the Senate will debate House Bill 1279, a measure to create an unequivocal right to an abortion in State law. While the debate in the Senate is expected to be lengthy, the bill is likely to pass and head to the Governor’s desk by the end of the week.

The measure is driven by Democratic concerns that the U.S. Supreme Court in June will overturn Roe v. Wade, the 1972 decision that legalized abortion nationwide. 

While Colorado became the first State in the nation to legalize abortion, through a 1967 measure that allowed it in cases of rape or incest, should the Supreme Court overturn Roe v. Wade it would no longer be legal in Colorado. The Court is looking at two cases: one from Mississippi that limits abortions to 15 weeks or less and another from Texas that limits it to six weeks or less.

Supporters also intend to bring forward a ballot measure to change the state Constitution in 2024.

Voters have rejected four ballot measures between 2008 and 2020 that intended to ban abortion or define personhood at the moment of conception. At the State Capitol, 44 measures that intend to do the same, including three this year, have been rejected. 

The debate over HB 1279 has been among the most intense in the legislature’s past 25 years. Two hearings, in the House Health & Insurance and Senate Judiciary committees, lasted 14 hours each, with those opposed to the measure outnumbering supporters by a 3:1 margin.

Many of the more than 300 who testified against the bill pointed to the bill's language that says fertilized eggs, embryos and fetuses do not have independent rights under the law. Some also claimed the bill would overturn the State’s 2003 parental notification law, which requires that parents be notified, but not have the authority to approve, a minor child’s abortion.

House Bill 1279 was debated for nearly 24 hours on March 11 and 12, likely a State record. Republicans, including Rep. Richard Holtorf, R-Akron, filibustered the bill, reading case law, legal opinions and offering more than a dozen amendments, none of which were successful.

Rep. Terri Carver, R-Colorado Springs, said the bill is so broad that it could prohibit anti-abortion protests or interfere with local zoning laws. Others raised the specter that if the bill passed, it would make Colorado a haven for the kinds of abortions performed by former Dr. Kermit Gosnell of Pennsylvania. Gosnell was convicted in 2013 of first-degree murder for three illegal late-term abortions and an involuntary manslaughter charge for the death of a patient. He was also convicted of drug dealing, was stripped of his medical license and is serving a life sentence.

The bill was approved on a party-line 40-24 vote in the state House on March 14.

On March 17, Governor Jared Polis signed into law Senate Bill 53, sponsored by Senator Jerry Sonnenberg, R-Sterling. The bill allows the University of Northern Colorado to open an osteopathic medical school. According to UNC President Andy Feinstein, the college, which will become Colorado’s second public medical school, will help address the shortage of physicians due to an aging workforce and growing State population. Once the school receives accreditation, it will open in fall of 2025 for up to 75 students and hopes to have classes of 150 per year by 2029. The school’s site is not yet determined; the university is working with the city of Greeley on a potential site downtown; another possibility is the site of the former Bishop Lehr Hall on the UNC campus. 

Banner Medical Group, which operates five hospitals as well as clinics throughout northern Colorado, including in Fort Morgan and Sterling, will provide physicians who will teach classes as well as provide some of the clinical training sites.