Hickenlooper proposing new tax credits

Gov. John Hickenlooper wants to tinker with Colorado’s tax refunds one more time before leaving office.

The Democrat proposed new tax credits for child care and education Thursday in his last official budget — a move that would mean fewer TABOR refunds for most Colorado taxpayers.

Under the Taxpayer’s Bill of Rights, Colorado can’t keep all the money it raises from taxpayers. There’s a formula that uses population growth and inflation, and it caps how much money the state can use each fiscal year. Everything above that cap gets returned to taxpayers.

But there’s a catch. The state can give that money away through tax credits passed by the legislature because it technically reduces how much revenue flows into state coffers. Seniors and veterans already have an exemption, as do lowincome Coloradans who qualify for the federal Earned Income Tax Credit. Hickenlooper wants to boost the state’s EITC by $64 million to $99 million over the next couple of years.

He also wants to give $24 million in tax credits to families with children to help offset the costs of child care.

And he wants to return $22 million as tax credits for workforce development, which means the money would go to people continuing their education or retraining for work in a new industry.

All those tax credits add up. If the General Assembly agreed to them, it would mean no one outside of those groups would get TABOR tax refunds in fiscal year 201920.

“Refunding what amounts to $2.67 per month to every Coloradan misses an opportunity to use these dollars strategically,” the governor wrote in his budget overview.

Aside from the proposed changes to the TABOR tax refunds, Hickenlooper’s final budget focuses on the programs he has prioritized throughout his eight years in office.

His $31.4 billion budget included requests for an average increase of 3 percent in state employee pay, payment on the K12 education debt and a buydown for Colorado’s public universities that would keep tuitions flat.