By Lars Gesing
It’s crunch time. Campaign season in Colorado and in Boulder is climaxing. There are only a few days left until Nov. 5, when decisions that will impact the future of the city, county and state will have to be made.
Where to vote yes? Where to say no? Under the Flatirons provides you with everything you need to know about the various issues during this year’s election…
Ballots include the names of those 11 certified Boulderites competing for the five seats on the new city council, as well as several other local and statewide issues that require thorough decision-making. In order to prepare you for that examination of your democratic values, we took a look at every ballot issue and listened to arguments of supporters and opponents. What emerged from that is this Under the Flatirons 2013 voter’s guide.
Your ballot will include the following statewide issues:
Amendment 66: Educational funding tax
Proposition AA: Colorado’s proposed Recreational Marijuana Tax
It will also include these local ballot issues and questions:
2A: The city’s marijuana tax proposal
2B: Sales and Use Tax for building and maintaining transportation infrastructure
2C and 2D: Sales and Use Tax Extension for open space, transportation and the general fund
2E: Electric Utility Amendments, $214 million acquisition debt limit and superseding other initiatives
2F: Negotiated or Private Bond Sales
2G: Qualification for Appointment to City Commissions
2H: Oil and Gas Exploration Moratorium Extension
310: Limitations on Debt
So what’s behind all this? Here’s the breakdown.
This ballot question is posed to every single registered Coloradan. Voting yes on it basically means accepting an income tax increase to fund Senate Bill 213, which passed in May. The bill changes the funding mechanisms in favor of education. The tax increase would raise an estimated $950 million during the first year and more in upcoming years, given that economic growth continues.
How much the tax increase would cost the individual is based on annual income. Those who earn less than $75,000 annually would pay a 5 percent flat rate (up from currently 4.63 percent). For those whose annual income exceeds $75,000, their new income tax would climb to 5.9 percent on every dollar after the first $75,000. Click here to determine your personal tax increase.
The reforms passed in May require that 43 percent of the state’s budget flow into the State Education Fund each year. That includes not only revenue generated from income taxes, but also from sales and property taxes. The two latter are currently the two main funding sources for Colorado’s education system.
Right now, the state and its school districts spend about $5.5 billion each year on education. The enhanced funding is necessary to enact plans to give more money to disadvantaged school districts, pay for optional full-day kindergarten and increase support for at-risk students.
“If Amendment 66 passes, the Boulder Valley School District will receive an additional $21 million in funding every year,” Chris Barge, director of the School Readiness Initiative at the Boulder County Community Foundation, explains the possible positive impact for the local school district.
However, higher education facilities and schools would be excluded from the extra funding.
According to calculations by the Colorado Legislative Council, fully implementing the plans will actually cost the state $1.12 billion. As the proposed tax hikes would generate an estimated $950 million, lawmakers would have to figure out ways to close the remaining funding gap during the 2014 legislative session.
So what do opponents argue about, then?
With an annual tax increase of about $133 for the average Coloradan, voting yes on Amendment 66 would noticeably affect the pocketbook of each resident.
The Denver Post recently reported accusations of critics who blame Gov. John Hickenlooper for trying to use the tax increase to backfill the state’s pension system. These charges can be misleading though, as a fair bit of the money will be used to increase paychecks for teachers across the state. And higher salaries automatically trigger more money that flows into the accounts of the Public Employees Retirement Association (PERA).
The Wall Street Journal recently published a review of the amendment accusing lawmakers to use it as an ultra-liberal ambush attack on the state’s tax flat rate and was designed to coddle teachers unions.
Meanwhile, Colorado’s decision on Amendment 66 receives national attention. The New York Times’ op-ed columnist Frank Bruni called the vote “a bold stride in a country too accustomed to baby steps.”
Recreational Marijuana Taxes
Ballot Issue 2A would allow the city of Boulder to add a 5 percent excise tax to marijuana that could be raised to up to 10 percent. It would also introduce a 3.5 percent sales and use tax on recreational pot that could go up to as much as 10 percent in the coming years, too.
Some of this money would be used to fund drug education and treatment programs. The rest would be added to the general city fund. The excise tax would be imposed on Boulder’s grow operations and manufactured product facilities that sell the marijuana outside city limits.
Supporters within city government say that the costs for regulating the industry are still unknown because Colorado’s law allowing recreational marijuana use is still fairly new.
While the necessity of funding for drug education and treatment is fairly uncontested, the argument is mainly about why the city would need extra revenue from a recreational marijuana tax when they already collect licensing fees to regulate the industry.
Additionally, Proposition AA – a statewide ballot issue – calls to impose a 15 percent excise tax and a 5 percent state sales tax on top of the already existing 2.9 percent sales tax. Added up with what Boulder’s city government asks for, marijuana could soon be subject to some pretty high taxation.
Leaders within the marijuana industry acknowledged that the passage of the new Colorado law — Amendment 64 — would mean that they had to pay back some of their revenue to allow the state to finance regulation measures.
However, those leaders argue that Boulder’s additional tax plans would drive potential buyers back into the black market where they could avoid heavy taxation – something Amendment 64 was designed to prevent.
The Denver Post editorial board recently called Boulder’s proposed additional taxation “excessive” and advised voters to “just say no.”
Sales and Use Taxes and their extensions
Ballot Issue 2B asks voters to approve a short-term sales tax that would raise money for transportation projects and maintenance. It proposes a sales tax increase of 0.15 percent from Jan. 1, 2014 until Dec. 31, 2019.
With transportation issues noted high on campaign agendas across all city council candidacies, this initiative to generate further funding to maintain and improve ways to get around the city enjoys huge support.
Current Boulder Mayor Matt Appelbaum is among those who argue that revenue for transportation issues can’t be generated by imposing higher parking fees.
“It would drive local businesses away,” Applebaum said.
Instead, he wants to increase availability of public transportation, especially in the commercial areas of east Boulder. Those measures, however, require significant financial efforts – in addition to the costs for maintaining the transportation status quo. In other words: Any dollar spent on transportation improvement is a good dollar, according to Applebaum and others.
“Boulder has done a lot to accommodate bikes and transit, but you can only get so far with what is in many parts of the city – especially east of Folsom – a traditional suburban land use,” Sue Prant, the director of Community Cycles, a Boulder-based non-profit bike collective, says.
The higher sales and use tax would be imposed until a proposed reallocation of open space taxes is supposed to take place in 2019.
This reallocation is subject to Ballot Question 2C. The 0.33 percent sales and use tax to preserve and acquire open space land expires on Dec. 31, 2018. Ballot Question 2C asks voters to permanently keep this tax.
However, the distribution of the money would change.
Starting Jan. 1, 2019, 0.22 percent of the overall 0.33 percent sales tax would go to open spaces, while the remaining 0.11 percent would flow into the city’s general fund. In 2035, these numbers would shift again, further lowering the percentage of tax-generated funding for open spaces to 0.10 percent, while 0.23 percent of the original tax would benefit the city’s general fund.
Unlike Issue 2B, which doesn’t face any formal opposition, 2C is more controversial, with open space advocates dreading the loss of funds.
And then there’s Question 2D, which asks for another sales tax extension to ensure funding for road repairs. If passed, 2D would continue a 0.15 percent city sales tax until 2039. Originally approved to fund open spaces, the money would start flowing into the pockets of the transportation department when the current bill expires in 2019. Starting 2030, the tax revenue would be reallocated again and then be used to help close the long-term budget gap the city faces for the remaining approved 10 years.
What ballot measures 2B, 2C and 2D essentially come down to is a shift of tax revenue from funding open spaces to focus on funding transportation and closing general city budget gaps. Combined, 2B and 2D would ensure 16 years of transportation financing at roughly $4.2 million a year.
Electric Utility Amendments and Limitations on Debt
Arguably the most controversial topic is the so-called “municipalization” debate that has raged in Boulder for years.
Ballot Question 2E asks voters to cap the amount of debt a possible future electric utility in Boulder could take on to pay for the current energy provider Xcel Energy’s distribution system and to buy any so-called “stranded assets” that Xcel already invested money in. This debt limit is declared at $214 million.
Furthermore, the charter amendment would allow the city to extend the services of a municipal utility to residents outside of city limits in order to provide them with safe, reliable service, too.
However, this ballot issue cannot be voted on without taking Ballot Question 310 into consideration. Boulder’s city council pushed to put 2E on the ballot as an answer to a query put forward in 310, a citizen initiative charter amendment with links to Xcel Energy.
This initiative, if passed, will require voter approval for any amount of total debt and repayment that a municipalized utility issues. It would also provide Boulder County residents outside the city limits who didn’t get to vote on the municipalization issue in 2011 with the chance to vote on whether they want to be part of the process.
Supporters of each of these competing measures have rallied for their individual causes for months. Those who want to keep the municipalization process alive ask for “yes” on 2E and “no” on 310, with opponents hoping for a vice versa vote.
For those who wonder what would happen if both measures were predominantly approved: In that case, the one ballot issue that has collected more “yes” votes will pass.
Mayor Appelbaum, though arguing in favor of a municipal utility, tried to negotiate by demanding for a “real discussion about the benefits without the prime of necessarily having to end with a municipal utility” as he was afraid the city efforts would come to a “dead end” in the Nov. 5 election.
Meanwhile, his arguments are still in line with those who criticize 310 as an effort to kill the municipalization effort before it even starts. They refer to the uniqueness of a ballot issue asking residents to approve debt in Boulder while no other city that pushes comparable efforts has to do the same. They also say that there is no legal mechanism for Boulder to hold elections for residents outside the city limits.
Giving citizens the ability to control how much their elected government officials can spend on a municipalized utility is the strongest argument supporters of 310 put forward.
The municipalization debate is a fight over whether the city should continue to allow Xcel to take roughly $35 million in revenues out of the city every year by providing the city with energy mostly generated through the use of coal. Boulder’s alternative is buying Xcel’s assets, creating an own utility and produce energy with the help of wind and solar power.City council candidate Ed Byrne argues in favor of financial awareness. “It will depend on the price if it is worth it. I have no doubt the city can run a municipal utility and run it well, but we need to be smart enough not to spend hundreds of millions of dollars in the wrong way.” He urges patience, saying it was too early to kill the efforts, and time and money should be spend on finding answers to questions on how much the efforts will ultimately cost.
Others, like Leslie Glustrom, co-founder of the non-profit group Clean Energy Action, warn that “one thing we can be confident of is that staying with Xcel will lead to ever higher rates for their fossil fuel-dominated system” as rate payers had to pay off the $1.5 billion that Xcel spent on coal plants over the last decade. She said: “Only by moving to fuel-free, non-profit electricity can we hope to begin stabilizing our electric rates.”
Negotiated or Private Bond Sales
Ballot Question 2F wants voters to decide whether the city should stick with the current practice required by the Boulder charter to sell bonds exclusively competitively or if negotiated bond sales should be allowed as long as the city would benefit from such sales.
In a negotiated bond sale, an underwriter buys the whole amount of bonds for a negotiated price. He then sells them to investors. Underwriters would be selected by a request for proposals.
The availability of such a method might come in handy for the city when it tries to sell bonds in order to finance the costs for a municipal utility, which is why opponents of 2E generally express their support for 2F. The new utility wouldn’t have a bond rating which might increase costs to compensate investors for their risks.
However, with negotiated bond sales, a broker could sell the advantages of such a utility to possible investors and help them in their risk assessment. That way, the city might get a better deal out of negotiated bond sales.
Qualification for Appointment to City Commissions
Approval of 2G would allow non-American citizens to serve on volunteer boards and commissions after they lived in the city for at least one year. The Boulder charter requires everyone who wants to serve on city boards to be registered in the city to vote.
The Human Rights Commission put forward a request for city council to place the question on this year’s ballot in a push to add diversity to boards and commissions.
Oil and Gas Exploration Moratorium Extension
This ballot question is about hydraulic fracturing, or “fracking,” the extraction method whose side effects are continuously challenged by environmental activists.
Boulder already has a one-year moratorium in place. What 2H asks voters to approve is to extend this moratorium until June 2018. City Council will have the chance to abandon it at any point after June 2016 by a two-thirds majority vote.
Activists of the volunteer group Frack Free Boulder published several recent peer-reviewed studies on their website showcasing the supposed impacts of fracking on water and air pollution as well as on climate change.
Supporters of 2H argue in favor of the extended five-year moratorium in order to have time to assemble further scientific evidence on the impact of hydraulic fracturing before City Council has to reassess the issue.
In a recent guest opinion piece in the Daily Camera, former Boulder City Council member and county commissioner Paul Danish gave five reasons not to support the moratorium.
He says the proposed moratorium is “hypocritical” as Boulder residents own more than 61,000 gasoline or diesel powered cars and trucks. He also calls the ballot question an abuse of power, a political statement more than a solution to any problems, immoral, and not favoring the environment.
So, there is a lot to decide on. If you are still uncertain or want more information, check out the official city of Boulder election information here.
Want to know more about candidates running for city council? The Boulder Blue Line, a political news website featured by volunteer writers and editors from within Bouder’s community, has run a series of profiles that can be found here.