Friday, October 16, 2015

Proposition BB – Retain Revenue in Excess of Blue Book Estimate

In 2013 Colorado voters approved taxation of marijuana sales. The 2013 State Ballot Information Booklet (aka Blue Book) provided an estimate of first-year revenue from the new marijuana taxes. That estimate of $67 million was high by $0.9 million, meaning that pot sales were not as high as anticipated and wouldn’t trigger a taxpayer refund under TABOR (Article X, Section 20 of the Colorado Constitution) ….. except that the Blue Book also provided an estimate of total expected state spending subject to TABOR with and without the new revenue. The economy has improved, and state revenues exceeded that estimate by $270 million.

The refund due to taxpayers is not the $270 million, but rather the $66.1 million of actual marijuana tax revenue. In the event that the Colorado electorate passes Prop BB and the state can retain the $66.1 million, House Bill 15-1367 provides for $40 million for school construction and $12 million for state youth, education and drug abuse prevention programs. The remaining $14.1 million is unallocated.

If this measure does not pass, the refund would be disbursed in 3 buckets:
1) $25 million to individual taxpayers, averaging about $8 per taxpayer,
2) $24 million to retail marijuana cultivators, and
3) $17.1 million to retail marijuana sales businesses via a temporary sales tax rate reduction.

Also if BB does not pass, local governments which received a total of $6.3 million in retail marijuana sales taxes would have their sales tax rate cut until their revenue is reduced by the $6.3 million. Boulder seems to have a marijuana business on every third commercial city block.

Recommendation: YES/FOR

TABOR’s stranglehold on our state’s finances continues. We need a real, constitutional fix for TABOR. Meanwhile, vote Yes on Prop BB to provide some relief.

Colorado should be celebrating because the economy has done better than predicted. Rather, we are discussing how to handle excess revenue. We see plenty of requests to increase taxes. Here we have an opportunity to keep money that we have already raised. I especially like having $14.1 million that is unallocated, providing for more flexibility – everything TABOR is not.

Website for the Yes side
http://www.voteyesonbb.org/

Editorial for the No side (No Excess Government)
http://pagosadailypost.com/2015/10/09/opinion-vote-no-on-proposition-bb/


Approved Ballot Language

Proposition BB (STATUTORY)

May the state retain and spend state revenues that otherwise would be refunded for exceeding an estimate included in the ballot information booklet for Proposition AA and use these revenues to provide forty million dollars for public school building construction and for other needs, such as law enforcement, youth programs, and marijuana education and prevention programs, instead of refunding these revenues to retail marijuana cultivation facilities, retail marijuana purchasers, and other taxpayers?

- YES/FOR
- NO/AGAINST

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