Another special legislative session on Colorado’s property taxes appeared imminent Monday after a long list of top civic and business groups from across the political spectrum said they supported a deal to stop a pair of measures from appearing on the November ballot.
The deal would cut property taxes by an additional $255 million in 2025 for taxes owed in 2026 — on top of the $1 billion cut the legislature already passed this year during its regular legislative session.
In exchange, Michael Fields, who leads Advance Colorado, a conservative political nonprofit, said he would pull Initiatives 50 and 108 off the statewide ballot and agree not to bring similar ballot measures for the next 10 years. Doing so would prevent even larger tax cuts that elected officials in both parties feared would lead to recession-like cuts to state and local services.
“This seems like a good path forward to end — hopefully — the property tax battles, and de-risk the budget,” Mark Ferrandino, the governor’s budget director, told the state’s Property Tax Commission on Monday.
A special session — the second one on property taxes in the last 10 months — seemed unthinkable a month ago. But after lawmakers and the conservative groups behind the ballot measures presented to the Colorado Forum in recent weeks, the two sides reignited negotiations that had stalled at the end of the legislative session, which ended in May. (The forum is a decades-old public policy panel made up of state business and civic leaders that takes positions on pressing issues.)
Initiative 50 would amend the state constitution to enact a strict cap on annual statewide property tax growth, while Initiative 108 would cut property taxes by $2.4 billion. The measures are being supported by Advance Colorado as well as Colorado Concern, a conservative-leaning nonprofit that represents state business leaders.
When the negotiations started up again, a special session seemed unlikely given how poorly the ballot measures have been polling and because Democrats didn’t want to give in to the groups behind the initiatives. But attitudes started changing late last week.
On Monday, the dam burst when social justice groups, business interests, the state’s hospital association, schools, teachers unions and foundations — both liberal and conservative — joined together in a letter asking for a special session be called.
“These initiatives present a very significant and real threat to all communities in Colorado,” the groups wrote. “For those reasons, we are supportive of a compromise and a special session.”
The organizations asked that the special session be narrow in scope and limited to one bill implementing an agreed-upon deal. The signatories included labor groups like the Colorado Education Association and the Working Families Party; K-12 school district and university leaders; and business groups like Club 20, the Colorado Contractors Association and the Colorado Hospital Association.
The mayors of Denver, Aurora and Colorado Springs also signed a letter to lawmakers Monday calling for a special session to prevent the ballot measures from passing.
“If passed, these two initiatives will drastically defund K-12 schools statewide, deplete local public safety resources and demand crippling cuts to local fire districts and special districts,” wrote Denver Mayor Mike Johnston, Aurora Mayor Mike Coffman and Colorado Springs Mayor Yemi Mobolade. “These are very real impacts that will negatively impact every resident’s quality of life. We are depending on our legislature to ensure this does not happen.”
The mayors said a special session would give the legislature the opportunity to find a “compromise that would avoid such negative impacts white still providing tax relief to our residents.”
Support for a special session isn’t universal. Some think any further cuts to property taxes are unnecessary and ill advised.
“I’m less agreeable, personally, to letting the deal be continually revised to the detriment of our state and our citizens,” said state Rep. Cathy Kipp, a Democrat from Fort Collins.
On Monday, some members of the state’s bipartisan Property Tax Commission bristled at being asked to weigh in on yet another tax cut that had been negotiated behind closed doors — just months after the legislature passed a property tax measure in Senate Bill 233 that many believed was supposed to put the matter to rest.
“If it wasn’t a deal (back) then, why did you pass 233?” said Mayor Guyleen Castriotta of Broomfield, who serves on the commission.
“The decision to have a special session has probably already been made by people who have a lot more power than me,” she complained.
In exchange for dropping Initiatives 50 and 108, here is the framework for the deal that would be considered during the special session, according to Ferrandino:
- In the 2025 tax year for taxes owed in 2026, the residential assessment rate for local government taxes would drop an additional 0.15% to 6.25%. Today the rate is 6.7%, but under Senate Bill 233, which was passed by the legislature this year with bipartisan support, it is scheduled to fall to 6.4% in the 2025 tax year for taxes paid in 2026. Residential assessments for schools would remain separate from those of local governments, and would fall to 7.05% from 7.15%. (Both cuts could be larger if property values grow faster than expected next year.)
- In the 2026 tax year, the residential assessment rate for local governments would rise to 6.8%. Under current law, it is scheduled to rise further to 6.95%. The school assessment rate would remain at 7.05%.
- Nonresidential assessment rates would drop to 25% in the 2027 tax year. Under Senate Bill 233, only commercial and agricultural property assessment rates fall to that level, while the rates for industrial and some other properties increase to 29%. The oil and gas industry, which pays much higher property taxes, would not benefit from the cuts.
- Local government revenue would be limited to 10.5% growth over two years, instead of 5.5% annually under Senate Bill 233. School districts would be limited to 12% growth over two years, a new cap that doesn’t exist in current law.
Fields also confirmed the details of the proposal to The Colorado Sun.
The session will likely happen the last week of August, since several Democratic legislators are traveling to Chicago for the Democratic National Convention next week.
Logistically speaking, either Gov. Jared Polis can call for a special session or the legislature can summon itself back to the Capitol by a two-thirds vote.
To meet the demands of conservatives, the deal would have to be completed before Sept. 9, when the November ballot is required to be certified by the Colorado Secretary of State’s Office. It takes at least three days to pass a bill at the Capitol.
Holding a special session brings political risks beyond the property tax debate.
It’s an election year, and Republicans are trying to dismantle the Democratic supermajority in the House and prevent one from being secured in the Senate. The GOP could be tempted to force the issue with controversial amendments and floor speeches.
The session may also invite disruption from lawmakers who aren’t returning to the Capitol next year after losing their primary races in June or abandoning their reelection bids mid cycle.
For instance, state Rep. Elisabeth Epps, a Denver Democrat who was unseated in the June 25 primary, has already been critical on social media of the tax debate. During the last special session on property taxes in 2023, she used the occasion to disrupt proceedings in protest of Israel’s war in Gaza.
Finally, unions will likely push lawmakers to take up some pro-labor bills passed during the session this year that Polis vetoed. That’s part of why a special session wasn’t called to strip out a provision in a bill kneecapping a 2024 ballot measure that would overhaul the state’s election process.
Polis can call a special session for a specific purpose, but can’t limit the legislature to only consider a specific bill. Courts have said the legislature has some leeway to introduce measures beyond the narrow scope of a governor’s call, as long as it has a “rational” connection to the session’s stated purpose, according to a legislative legal memo.
So far, much of the planning for the special session has happened behind closed doors.
Last week, the House and Senate Democratic caucuses met to discuss the situation, but reporters were kept out.
The Senate Democratic caucus met Thursday evening on Zoom to discuss “what would even be possible with schedules/logistics” around property taxes and the state budget, a spokesperson said.
The Sun tried to attend the meeting, but was barred because legislation wasn’t going to be discussed and nothing is currently pending before the legislature, the spokesperson said.
A similar situation played out when The Denver Post tried to attend the House Democrats’ gathering, according to a reporter for the newspaper.
The new open meetings law for the General Assembly that was passed by the legislature this year says the public does not have a right to attend meetings about subjects that “are by nature interpersonal, administrative or logistical.” Previously, an open meeting was broadly defined as “any kind of gathering, convened to discuss public business, in person, by telephone, electronically, or by other means of communication.”
This is a developing story that will be updated.