Colorado voters will be asked in November to amend the state constitution to impose a graduated income tax system that would generate billions of dollars in new state revenue each year.
The Colorado Secretary of State’s Office announced Tuesday that the supporters of Initiative 195 — a coalition of liberal political advocacy organizations — turned in enough signatures to get their measure on the November ballot.
Initiative 195 will ask voters to raise Colorado’s flat 4.4% income tax rate on income earned by people and corporations that exceeds $500,000 a year while keeping flat or cutting the income tax rate on earnings less than that.
On the high end, annual income earned by people and businesses over $1 million would be taxed at 8.4%, while on the low end, earnings up to $25,000 would be taxed at 3.7%.
For a household earning the median Colorado income of about $95,000, their effective tax rate would drop to 4.07% from 4.4%, resulting in a savings of a few hundred dollars a year. A family earning $1.2 million annually would have an effective tax rate of 6.39% and pay nearly $24,000 more in income taxes.
Those changes are estimated to raise about $2 billion annually, which would go toward increasing funding for K-12 schools, healthcare and early childhood programs.
Protect Colorado’s Future Coalition is the state issue committee supporting Initiative 195. The group raced to the finish line last month to collect enough signatures to get the measure on the November ballot.
The organization was successful in large part because of a late infusion of campaign cash that allowed it to pay people to collect signatures for the initiative.
The group had raised only about $100,000 through June 24 before taking in more than $300,000 between June 25 and July 27.
Major donors during the last campaign finance reporting period included the Bell Policy Center, a liberal nonprofit think tank, at $100,000; the Colorado Statewide Parent Coalition, a nonprofit led by Democratic state Rep. Lorena Garcia, at $50,000; and Great Education Colorado Action, a nonprofit, at $50,000.
John Powers, a Boulder activist and philanthropist, gave $30,000 — the largest individual contribution to the issue committee during the last reporting period.
The Bell Policy Center’s donors, which have been shared with The Colorado Sun, include a number of liberal-leaning nonprofits and foundations, as well as individual donors sympathetic to Democratic candidates and causes. The Colorado Statewide Parent Coalition posts a list of its major donors on its website.
Great Education Colorado Action, the political offshoot of the nonprofit Great Education Colorado, does not reveal its donors and is what The Sun refers to as a dark money organization.
Voters will also see a competing measure, Initiative 232, on the November ballot.
Brought by the conservative political nonprofit Advance Colorado, a dark money group, Initiative 232 would change state law to prohibit the income tax rate from rising above 4.4%.
If both Initiatives 195 and 232 pass, the courts may have to weigh in on whether and how the initiatives would interact. Both measures need just a simple majority of voters’ support to pass.
Initiatives 195 and 232 are among 13 measures that will be on the statewide ballot in November.