October 24, 2013
Colorado voters soon will be making an important decision regarding the education of our children. If passed, Amendment 66 would increase our income taxes significantly to finance some school reforms the General Assembly already has passed.
Schools must have sufficient funding to succeed but history has proven that additional dollars without substantive reforms in the delivery of education cannot produce improvement in educational outcomes. Total real American spending per student at all levels increased 23.5 percent in the decade ending in 2005 and 49 percent over the 20 years prior. During that time, reading scores and high school graduation rates show that performance of American students did not improve dramatically though spending soared.
Some significant issues regarding Amendment 66:
■ It would be a permanent income tax increase of $950 million per year for K-12 education. Personal income tax rates would increase to 5 percent on the first $75,000 of taxable income and to 5.9 percent on taxable income above $75,000, both from the current 4.63 percent flat rate. For small businesses, taxes could rise, and for large businesses, taxes could remain at 4.63 percent.
■ Amendment 66 language would allow the General Assembly to “annually adjust the income thresholds for the income tax increment.” Without taxpayer approval, the General Assembly could adjust our income taxes annually.
■ Our community would “contribute” between $6.5 million and $7.5 million in new income taxes to the state in exchange for receiving approximately $1.5 million back in school district benefits. And nobody from our district or community has been able to justify that this financial drain would produce a commensurate value in educational outcomes for our students.
■ Amendment 66 “requires that at least 43 percent of state income, sales and excise tax revenue ... be set aside annually to pay for public education.” Our representatives would be hand-tied regarding the future management of state budgets.
■ A well educated workforce may help to attract new businesses to Colorado, but so do low income tax rates. Four of Colorado’s neighboring states either have no income tax (Wyoming), are reducing rates or are phasing them out altogether (Utah, Kansas, Oklahoma). Amendment 66 would raise income tax rates in Colorado.
With 80 to 85 percent of a typical Colorado school district’s budget dedicated to personnel costs (Steamboat at 84.94 percent), it’s no surprise that the National Education Association and the Colorado Education Association have massively supported the passage of Amendment 66.
What is surprising is that while supporting a tax increase to fund “education reform,” the CEA concurrently is preparing to sue the state from implementing some of these very “reforms” if 66 passes.
We historically have supported our local district well with mill levy overrides, bond issues for facilities and continued authorization of the 0.5 percent city sales tax generating $2.5 million per year dedicated 100 percent to local education. We should all be concerned that an income tax increase to support education could compromise the future willingness of our taxpayers to continue to support our current level of local taxes.
A strong, well-funded, high-quality education system is a critical necessity for the future economic development of our community and state. But what truly matters is not how many dollars are allocated to statewide education but how well and how efficiently available dollars are applied to reforming the statewide delivery of education.