Special Session Report - COLORADO LEGISLATIVE STRATEGIES NEWSLETTER

Special Session Report

 August 28, 2024

 Day Three Action
 On the third day of the special session, the House wrapped up third reading votes and debate on the two bills and one resolution left for consideration. All three were sent over to the Senate in the afternoon for their first committee hearings and second reading debates.

 The first bill up was House Bill 1001 (the negotiated “deal” bill), which took up most of the discussion this morning. Both sides of the aisle spoke to the bill during debate. However, members on the more extreme sides of both caucuses tended to be critical of the bill.

 The bill was amended by sponsors to make technical changes, but other than that, no other amendments were added to the bill. After roughly three hours of debate, the bill passed with 45 yes votes from 30 Democrats and 15 Republicans, and 18 no votes from 15 Democrats and 3 Republicans. 

 Next, the House considered House Bill 1003, which deals with agricultural business personal property tax exemptions. The House easily passed this with 47 yes votes and 16 no votes, and it was also sent over to the Senate. 
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 The last bill up for debate on the House side was House Concurrent Resolution 1001, which threatens the negotiations currently on the table for property taxes included in House Bill 1001. Because this is a resolution and would refer a measure to the November ballot, the resolution needed a yes vote from two-thirds of House members, or 44 votes, to move forward to the Senate.

Democrats currently hold a 46 seat majority in the House so they can only lose two votes on the resolution in order for it to move forward. Representative DeGruy Kennedy has not been participating in the special session so the Democrats could really only lose one vote. The resolution passed with 44 Democrats voting yes and 19 no votes from all the Republicans and just one Democrat – Representative Snyder. 
 
On the Senate side in the afternoon, House Bill 1001 was passed unanimously out of Senate Appropriations without any amendments. In Senate Finance, House Bill 1003 passed on a vote of 4-3. However, House Concurrent Resolution 1001 didn’t make it out of Senate Finance. Likely because of how controversial the resolution was and the threat of upending the property tax negotiations, it was postponed indefinitely at the request of Senator Hansen, the bill sponsor. 
 
After Senate committees wrapped up this afternoon, the Senate went to the floor for second reading debate on House Bill 1001 and House Bill 1003. While the debate lasted a couple of hours, both passed second reading without any amendments and will be up on the Senate floor for third reading tomorrow morning. 
 
What’s Next
 
The special session will end tomorrow after the Senate votes on third reading, assuming no new amendments are added to either bill. If one, or both, of the bills is amended in the Senate, that bill would have to go back to the House for concurrence. If no new amendments are added in the Senate then the bills will be sent to the Governor for approval. The Governor has stated he will not sign House Bill 1001 until ballot initiatives 50 and 108 are officially withdrawn, however.
 
COLORADO LEGISLATIVE STRATEGIES NEWSLETTER
 
Special Session Report
 
August 27, 2024
 
Day Two Action
 
On the second day of the special session the House made it through second reading debate and the Senate gaveled in and gaveled right back out because they don’t have anything to do until the House sends over the bills. The Senate waiting on the House – feels just like the end of a regular session. 
 
First up for the House was House Bill 1003, the bill about agricultural business personal property tax exemptions, which passed second reading. However, the ultimate fate of this bill in the Senate remains uncertain. 
 
Next up was House Concurrent Resolution 1001, the resolution that seeks to put a constitutional measure on the November ballot about local approval of statewide property tax initiatives. The fate of this resolution has the potential to upend the whole deal to withdraw the property tax ballot measures in exchange for the negotiated deal bill passing. 
 
Not surprisingly, and despite that potential, the House passed the resolution on second reading. The resolution does need a two-thirds majority to pass since it’s a constitutional measure, which means it needs 44 votes (there are 46 Democrats and 19 Republicans in the House) so there is a chance the resolution dies on the third reading final vote tomorrow. But if it does pass the House, the Senate is expected to do what’s needed to hold the deal together and vote down the resolution. 
 
Last up for the House today was the debate on House Bill 1001, the negotiated deal bill. Two amendments were added to the bill, including one to provide additional flexibility to school districts and local governments by allowing them to retain revenue above the growth cap if in the prior assessment cycle they did not reach the cap. This will allow districts to keep additional funding in years that follow low-growth cycles, letting revenue catch back up to the long-term trendline. The House also adopted an amendment to direct the Property Tax Commission to evaluate the property tax changes made in Senate Bill 233 and House Bill 1001 and report back on how Colorado’s tax code does or does not deliver relief to the people who need it the most.
 
Finally, House Bill 1007, the bill about accessible housing property taxes, will die on the calendar as it was referred to the Appropriations Committee when it was passed out of committee yesterday and Appropriations did not hold another hearing today to call up the bill. 
 
What’s Next
 
Tomorrow the House will have third reading final votes on the three remaining pieces of legislation and then the Senate will take things over for their committee hearings and floor debate. Expect things to move a little faster in the Senate than the House.
 
COLORADO LEGISLATIVE STRATEGIES NEWSLETTER
 
Special Session Report
 
August 26, 2024
 
Introduction
 
Is it really a special session if it happens multiple times in a year? Special sessions are technically called extraordinary sessions – because they aren’t supposed to be ordinary. But the issue of property taxes is warping the definitions of those words at the Capitol these days.
 
For the second time in less than one year the legislature has convened for a special session on property taxes. In the wake of the defeat of Proposition HH there was a special session on the issue last November. That special session provided some temporary property tax relief and created a commission that was supposed to come up with a long-term solution to the issue of property taxes. The commission met throughout the entire 2024 session and a “compromise” bill ultimately came forward at the very end of last session. 
 
But unlike the other grand compromises last session that resulted in ballot measures on different topics being pulled from the ballot, the property tax compromise bill wasn’t enough for the property tax ballot measure proponents so here we are. At the Capitol. In August. 
 
Day One Action
 
The special session kicked off this morning with the introduction of several bills and resolutions. Only one bill is the “deal” negotiated between the governor, legislative leadership, and groups behind the ballot measures. However, 13 total bills and resolutions were introduced, with some having the potential to upend the whole deal. 
 
On the Senate side, only two resolutions were introduced and both were swiftly voted down in the Senate Finance committee. Senate Concurrent Resolution 001 referred a measure to the November 2024 ballot to allow a local government to replace the current ad valorem property tax with a land value tax, but died in committee with no votes in favor. Additionally, Senate Concurrent Resolution 002 referred a measure to the November 2024 ballot that would change how special district property taxes are levied and calculated, but died in committee on a party line vote of 2-4.
 
The House, on the other hand, had a much longer day. Republican bills that died in their first committee included: House Concurrent Resolution 1002, which would have referred a measure to the November 2024 ballot to restore the Gallagher Amendment that was repealed by voters in 2020; House Bill 1006, which would’ve adjusted and expanded the current homestead exemption for certain seniors, disabled veterans, and Gold Star spouses; and House Bill 1008, which would’ve created a task force to design a new tax code by eliminating all taxes except for sales and use taxes. 
 
Even bills sponsors by Democrats that were outside of the deal died in the House, including: House Bill 1002, which would have referred a measure to the 2025 ballot to create a residential property class for owner-occupied primary residences, and remove a subtraction for assessed value of other types of residential, such as second homes; House Bill 1004, which would have made changes to value reductions for residential property; House Bill 1005, which would have tied the subtraction for actual value to the median actual value of residential property for each county; and House Bill 1009, which would have allowed Title 32 special districts to waive a statutory limitation on the collection, retention, or spending of property tax revenue with voter approval.
 
That being said, there were a few bills that survived their first committee hearing and are now headed to the House floor for second reading. House Bill 1007, which passed out of committee unanimously, creates a subclass of residential property to account for accessible housing property, and allows that property to be assessed with a reduced assessment rate. Additionally, House Bill 1003, which will expand some business personal property tax exemptions in the agricultural industry  passed 7-3. Both of these bills passed but were not necessarily part of the negotiated deal but it was argued that they are about property tax issues and therefore fit under the purpose of the call for the special session.
 
House Bill 1001 – the deal – also passed on a vote of 8-3, with two Democrats and one Republican voting no on the bill. This bill is supposed to reflect negotiations made between the Governor’s Office, legislative leaders, and groups behind the ballot measures. The bill would expand on Senate Bill 233 from the 2024 Regular Session. The bill reduces property tax revenue growth caps on local governments and sets an annual growth cap on revenue collected for schools, while lowering assessment rates on residential property.
 
As a reminder for how much relief Senate Bill 233 and House Bill 1001 provide, along with how much of an impact the ballot measure would have, here is a chart from the Colorado Sun comparing the different proposals with current law:
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Contrastingly, House Concurrent Resolution 1001 threatens to upend negotiations made between the Governor’s Office, legislative leaders, and other stakeholders, would refer a measure to the November 2024 ballot that requires voter initiatives that impact property tax revenue or spending to be approved by a local government before the statewide limit applies to that local government. The resolution passed committee on a party line vote of 8-3, with all Republicans voting against the bill. Watch out for everything to blow up if this ends up passing; but keep in mind, even if it passes out of the House it’s going to need at least one Republican vote to pass the Senate.
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 What’s Next
 It’s often said that it only takes three days to pass a bill, and everyone was hoping the special session would only last three days. Unfortunately, the House needed to get through committee work and floor work today to make three days happen – and the committee hearings running into the night caused floor debate to get pushed to tomorrow. 
 Tomorrow will only include House floor debate and the Senate won’t have anything to do at all. The rules state second and third reading can’t happen on the same day; so the House will do second reading tomorrow – expect lots of feelings about property taxes, the deal, and everything else – and then will do third reading on Wednesday before sending the bill(s) over to the Senate for committee and floor debate. If nothing else goes off the rails the Senate should be coming in for just the final vote and conclusion of the special session on Thursday.