Colorado Legislative Strategies - 2022 Ballot Measures

​COLORADO LEGISLATIVE STRATEGIES NEWSLETTER
 
2022 Ballot Measures
 
October 7, 2022

Introduction
 
The 2022 election is right around the corner! Ballots are going to be sent out in the mail starting on October 17. Here’s a quick preview of all the statewide ballot measures that are on the ballot.
 
There are eleven (11) total ballot measures this year. Three (3) are constitutional amendments referred by the legislature, two (2) are statutory propositions referred by the legislature, and six (6) are statutory propositions referred by citizens. 
 
For background, each ballot measure is going to have letters or numbers. Constitutional amendments from the legislature get single letters A-Z (D, E, F). Statutory propositions from the legislature get double letters AA-ZZ (FF, GG). Constitutional amendments from citizens get numbers 1-99 (none this election). And statutory propositions from citizens get numbers 100-199 (121-126). All of these letters and numbers roll sequentially from election to election.
 
A constitutional amendment needs 55 percent of the vote to pass due to Amendment 71 (also called “Raise the Bar”) that passed in 2016. Statutory propositions just need a majority to pass.
 
More information on each ballot measure can be found in the 2022 State Ballot Information Booklet, commonly called the Blue Book, and the Fiscal Impact Statements for Statewide Ballot Measures. But for those normal people who don’t want to read all that, here’s a straightforward breakdown with some additional insight for all the ballot measures this year.

​Amendment D – New 23rd Judicial District Judges
 
This one is simple and just deals with moving judges around. The state is split up into Judicial Districts (JD) consisting of one or more counties. For example, the 1st JD is Jefferson and Gilpin counties, the 2nd JD is just Denver county, and so on. The 18th JD, made up of Arapahoe, Douglas, Elbert, and Lincoln counties, was by far the largest JD due to recent population growth so in 2020 the legislature decided to split it into multiple districts. Arapahoe County will remain the 18th JD and Douglas, Elbert, and Lincoln counties will be the new 23rd JD. Amendment D simply deals with transferring judges from the 18th JD to the new 23rd JD. 
 
Legislators can’t end judges’ terms early, so without this amendment passing there will be too many judges in the 18th JD when the new 23rd JD officially splits off in 2025. This is a narrow, technical amendment that just seeks to transition judges and keep costs down.
 
There are no official campaigns registered to run a YES or NO campaign for this ballot measure. 
 
Amendment E – Extend Homestead Exemption to Gold Star Spouses
 
This one can be summed up as lower property taxes for surviving military spouses. The current homestead exemption reduces the property tax burden and applies to senior citizens who have lived in their home for at least 10 years and veterans with a service-connected disability rated 100 percent permanent. Surviving spouses of those two classes can also claim the exemption as long as they live in the same home. 
 
This amendment seeks to add surviving spouses of service members who died in the line of duty and veterans whose death resulted from a service-related injury, commonly called Gold Star spouses. It is estimated this will cost the state about $300k per year. 
 
Counties get property tax revenue and the state reimburses them for the cost of the homestead exemption. The state spends about $157 million per year on the senior homestead exemption and about $6 million per year on the veterans with a disability homestead exemption. 
 
There are no official campaigns registered to run a YES or NO campaign for this ballot measure. 
 
Amendment F – Changes to Charitable Gaming Operations
 
This one will be important to some nonprofits and irrelevant to most people. The constitution allows nonprofits to run bingo and raffle games to raise money and specifies the rules that must be followed, so any change to those rules must be made through a constitutional amendment. This final amendment referred by the legislature is simply trying to ease those rules. 
 
If Amendment F passes, nonprofits will only need to be in operation for three years instead of five years in order to apply for a bingo-raffle license. Additionally, the nonprofit can pay the workers who run the game instead of them needing to be unpaid volunteers. That’s it. Colorado definitely has some weird things embedded in the state constitution. 
 
There are no official campaigns registered to run a YES or NO campaign for this ballot measure. 
 
Proposition FF – Healthy School Meals for All
 
You know the saying, there’s no such thing as a free lunch. Historically, the federal government covered the cost for free and reduced cost school meals for families who qualified based on income. However, that all changed when COVID hit and the federal government covered the cost to provide free school meals to all students. This measure referred by the legislature seeks to keep the universal free meals going and pays for it with increased income taxes for households making $300,000 or more. 
 
Technically, this measure doesn’t really raise taxes, it actually just limits deductions and thereby increases the tax burden for households making over the threshold. This affects about five percent of all returns and will increase taxes around $800-1100 depending on income level. 
 
This measure, along with GG, has attracted the most fundraising for a measure referred by the legislature, and has raised about $1 million for the YES campaign. Fiscally conservative groups who dislike raising taxes are in opposition but have not raised much money for a NO campaign. 
 
Proposition GG – Add Tax Information Table to Petitions/Ballots
 
The final measure referred by the legislature will give voters more information but make the ballot longer. The measure seeks to require a tax information table appear for any citizen run measure that changes the individual income tax rate. 
 
For background, income tax cuts are often put on the ballot and these measures often pass because who doesn’t like the sound of paying less income tax. Proponents in the legislature want to add a tax information table to those ballot measures to show how the change will actually affect taxpayers in different income brackets. Those differences in savings per income tax bracket will become more clear in the next section, which just so happens to be an income tax cut ballot measure. 
 
Like FF, this measure has attracted the most fundraising for a measure referred by the legislature, raising about $1 million for the YES campaign. Fiscally conservative groups are again in opposition but have not raised much money for a NO campaign.
 
Proposition 121 – State Income Tax Rate Reduction
 
The first citizen run ballot measure to make it on the ballot is an income tax cut. The measure seeks to permanently lower the income tax rate for individuals and corporations from 4.55 percent to 4.40 percent. If approved, this will represent about $413 million less in income tax collections and will reduce General Fund revenue by about 2.4 percent. 
 
As was previewed in the previous section, you might be wondering who is going to really benefit from this income tax cut. Approximately 75 percent of taxpayers will receive a tax cut of less than $63 per year. The top one percent, on the other hand, will receive a tax cut of nearly $7,000 per year. That difference is why Proposition GG was out on the ballot. 
 
The opposition campaign has out-raised the proponents so far. The NO campaign is primarily funded by the National Education Association and has raised about $250,000. The YES campaign in contrast, backed by the Independent Institute and Americans for Prosperity, has raised about $10,000.
 
Spending aside, however, voters will be making their choice after reading “should taxes be lowered…” and this measure could easily pass. Additionally, both nominees for Governor, including Democrat Jared Polis, are in support of this measure. 
 
Propositions 122 – Access to Natural Psychedelic Substances
 
Now we get to the real pressing question for Colorado voters - should psychedelic substances be decriminalized. Yes you read that right, there is actually a ballot measure to decriminalize magic mushrooms (and other psychedelic substances) and create a regulated system for accessing these psychedelics. 
 
The proponents argue that there are significant mental health benefits of these substances, but let’s be real, some people just want to be able to use psychedelics for recreation. And in a state that was the first to allow recreational marijuana, maybe it will pass. 
 
The YES campaign has raised nearly $3 million primarily from the New Approach PAC out of Washington DC, although most of that went to signature gathering and making it onto the ballot and they have only raised $250,000 since being certified for the ballot. The only formal opposition is from Protect Colorado Kids and they have only raised a mere $750.
 
Proposition 123 – Dedicate Revenue for Affordable Housing Programs
 
There is a lot of talk about affordable housing; it’s at the local level, it’s at the state level, and now there is a ballot measure for it too. This measure seeks to set aside a portion of the state’s annual income tax revenue (0.1 percent) for affordable housing programs. 
 
It may sound like a small portion, just 0.1 percent, but that will add up to about $300 million per year. The measure seeks to create six different programs spread across the Office of Economic Development and the Department of Local Affairs, ranging from just over $5 million to support local governments to up to $122 million for affordable housing equity. 
 
The measure stipulates that the money will be exempt from TABOR, meaning in the years when there is a TABOR surplus it will just lower the amount of money that will go out as TABOR refunds. However, in the years where there is no TABOR surplus the legislature (really the Joint Budget Committee) will have to grapple with how to fund these programs along with other parts of the budget. That is why several members of the JBC have written op-eds in opposition to this ballot measure. 
 
Outside of the three alcohol measures discussed below, this measure has raised the most money. Proponents of the measure have raised nearly $5 million, including nearly $2 million since qualifying for the ballot, with Gary Community Investment as the primary supporter. The only formal opposition is from Path 2 Zero, an initiative of the Independence Institute, which has raised less than $5,000 and is also opposing F, GG and FF, and supporting 121. 
 
Proposition 124 – Increase Allowable Liquor Store Locations
 
This one can be summed up as allowing the owners of  liquor stores to have more locations. Current law allows liquor store owners to increase from only one location in 2017 to up to four locations after 2032. This measure seeks to allow liquor stores to go up to eight locations immediately and have an unlimited number of locations after 2037. This matches current law regarding how many grocery stores can increase locations that sell all types of alcohol. This can be summed up even further as good for big liquor store chains, good for consumer choice, but potentially really bad for small local liquor stores. 
 
The main proponent is Total Wine & More, who has raised over $7 million, with the first $2 million going toward making the ballot. The opposition is from Keeping Colorado Local, which has raised about $600,000 mostly from local liquor stores and the Colorado Licensed Beverage Association. Keeping Colorado Local is also the main opposition to the next alcohol measures, 125 and 126. 
 
Proposition 125 – Allow Grocery and Convenience Stores to Sell Wine
Proposition 126 – Third-Party Delivery of Alcohol Beverages 
 
Rounding out the ballot for 2022 are two more alcohol ballot measures, which are running their campaign together. Proposition 125 seeks to allow grocery and convenience stores to sell wine and Proposition 126 seeks to allow third-party delivery of alcohol. 
 
The YES campaign, which is backed by DoorDash, Instacart, Target, Albertsons, Safeway, and Kroger (King Soopers and City Market), has raised the most money at over $11 million. The NO campaign is again Keeping Colorado Local, which has only raised just over $600,000 to oppose 124, 125, and 126.
 
The alcohol landscape in Colorado used to be quite different. Prior to 2017, consumers couldn’t even buy full-strength beer in grocery stores. But when that changed it set the stage for more consumer choice and access. We are now used to buying our beer along with our groceries and the next logical step is allowing consumers to buy their wine along with their groceries too. 
 
Rules under COVID allowed restaurants to sell and deliver alcohol in single serve containers, a six pack of beer, or a bottle of wine or liquor along with the food. Those rules are set to expire soon. Proposition 126 also makes these rules permanent for restaurants. 
 
Additionally, COVID changed the world we are living in. Sure, delivery existed before COVID but it was mostly pizza and just a few other things that were the norm. Now, however, people are used to getting everything delivered at the touch of a button and allowing alcohol too is the next logical step for consumers.
 
Conclusion
 
The 2022 ballot measures have a little bit of everything -- transitioning judges (D), extending property tax relief to surviving military spouses (E), changing charitable gaming rules (F), free school meals for all students (FF), adding tax information tables to ballots (GG), cutting the state income tax (121), decriminalizing psychedelic substances (122), dedicating money to affordable housing (123), allowing more liquor store locations (124), allowing wine in gas stations and grocery stores (125), and allowing third party delivery of alcohol (126). 
 
Keep an eye out next week for a preview of the key races this election. Ballots are going to be hitting mailboxes starting on October 17 and voting will happen until 7pm on November 8.