Proponents say initiative mirrors SB 135; staff warn it could let Colorado retain billions for K‑12 funding

Legislative staff and proponents met March 30 in Room 109 of the State Capitol to review proposed Initiative 282, a citizen's initiative that would create a voter-approved revenue change allowing Colorado to retain and spend an amount equal to state public K–12 education funding and to increase that funding by up to 2% for 10 years.

Nicole Myers of Legislative Legal Services read the office's memorandum summarizing the measure's major purposes, including the creation of an "excess state revenues account" in the General Fund and a requirement that the General Assembly first appropriate amounts from that account to the Department of Education to pay a district-level "positive factor" funding formula. The memorandum says the positive factor funds may be used only for increasing teacher pay, improving teacher retention, lowering class sizes, and expanding access to career and technical education.

Myers told the proponents that the memorandum's proposed definition of "state public education funding" generally tracks total appropriations for categorical programs and the state share of total program funding subject to the state spending limit. As an example of scale, the memorandum estimated the state's public education funding at approximately $4,800,000,000 for the 2026–27 fiscal year, noting that, if the initiative operates as written, the amount the state could retain in a single year could be substantial.

A staff question flagged how the initiative would interact with the Taxpayer's Bill of Rights (TABOR). The memorandum and staff asked whether proponents intended the measure to authorize the state to retain revenues that otherwise would be refunded to taxpayers under Article X, Section 2-7D of the Colorado Constitution. Proponent John Caldero responded in the hearing that the initiative is "basically a carbon copy of Senate Bill 135," and said answers applicable to SB 135 would apply here.

Staff also reviewed mechanics in the draft statute: creating the excess state revenues account; requiring transfers from that account to the Department of Education to pay districts' positive factor funding; and allowing the General Assembly to appropriate any remaining funds for other purposes. Staff asked whether proponents intended a limit equal to the lesser of 2% of state total program funding for the 2026–27 budget year or the amount that would otherwise be refunded under TABOR. Proponents declined to provide a different interpretation in the hearing and deferred some technical and policy answers to the bill authors or the SB 135 record.

The memorandum would also direct the state auditor to publish an annual legislative report describing how much revenue the state retained under the voter-approved change and how those revenues were spent. Staff noted that the initiative includes conforming amendments intended not to affect the expanded earned income tax credit, the family affordability tax credit, or the affordable housing financing fund.

Several staff questions about fiscal or programmatic impact went unanswered in detail at the hearing. Staff asked how the General Assembly would likely reuse any retained revenues beyond the Department of Education priority; proponents offered no specific reuse plan in this meeting. Staff also asked what priority reimbursements to local governments for specified property tax exemptions would have under the proposed initiative; proponents said those questions were for the bill authors.

On the question of legal overlap, staff observed the proposed initiative appears substantially the same as the introduced version of Senate Bill 135 and asked what would happen if both measures appeared on the ballot and both passed. Proponents said that a court would decide any conflict.

The hearing was procedural review and record-building under statute; no vote or legislative action was taken. Staff offered technical comments from their memorandum, and proponents said they had already made the noted technical changes. With that, Legislative Council staff adjourned the hearing.