Over the past two years, Colorado has witnessed a shocking 40% surge in housing costs, an alarming trend that has left Coloradans grappling with financial strain as their incomes struggle to keep pace. If we do nothing, property taxes will soar by an equal 40% on average statewide, posing a grave challenge for vulnerable seniors and hardworking families alike.
The consequences of failing to halt this relentless rise could be dire, casting long-term shadows over Colorado’s residents and its economy. Seniors on fixed incomes may find themselves unable to afford their homes, while businesses will face difficult decisions such as layoffs or even closing their doors. This crisis also extends to renters, as landlords are likely to pass on the increased costs to tenants.
In response to this pressing issue, Proposition HH was referred to the ballot by the Legislature and Gov. Jared Polis this year to provide a much-needed remedy. In essence, Prop HH represents a responsible tax cut and stands as our best chance to avert a crisis.
Prop HH comprises three essential components: immediate property tax relief by cutting the impending increase in half; targeted assistance to seniors through the portability of the Senior Homestead Exemption; backfill funding for vital institutions reliant on property tax revenue, including schools, fire districts, water districts, local governments and libraries.
The benefits of Prop HH for Coloradans are undeniable. If passed, it would offer annual property tax relief ranging from $1 billion to $1.6 billion for families, businesses and seniors across the state. In fact, the average homeowner would save $1,000 over the next two years, while seniors over 65 who had lost their Senior Homestead Exemption would recover it under Prop HH, saving $2,122 during the same period.
These savings could prove life-changing for many families, and seniors could downsize without fearing the loss of their Senior Homestead Exemption, potentially easing the housing crisis. Prop HH also extends additional benefits to renters by establishing a new statewide rental assistance fund with an annual allocation of $20 million.
What sets Prop HH apart is its fiscal responsibility. The measure slightly adjusts the TABOR cap by just 1%, directing the additional funds toward essential areas such as local governments, rental assistance and the State Education Fund. Importantly, thanks to Colorado’s flourishing economy, taxpayers would receive a TABOR refund of more than $800 for 2023 through Prop HH. This means that all Coloradans earning less than $99,000 a year would see an increase in their refund.
Contrary to misinformation disseminated by opponents of HH, the impact on TABOR refunds is minimal. Proposition HH offers an average homeowner $500 in tax savings next year, while only reducing TABOR refunds by $46. According to a recent report from the Colorado Fiscal Institute, Colorado taxpayers are still projected to receive up to $10,000 in TABOR refunds over the next decade if the economy continues its growth.
Prop HH represents a sound deal for Colorado. Respected organizations such as AARP, the Colorado Alliance for Retired Americans, the League of Women Voters of Colorado, Colorado Education Association, Colorado Professional Firefighters, and Colorado Concern have endorsed HH because they recognize it as the most responsible way to provide immediate property tax relief without jeopardizing our schools and fire districts.
In contrast, the opponents of HH offer a reckless alternative to the property tax increase. Initiative 50, set to appear on the ballot in 2024, seeks to impose a hard cap of 4% on property taxes statewide, eliminating local control over property taxes and without replacing the revenue essential for funding critical services. This proposal would undeniably devastate our schools, firefighters and the services that communities rely upon.
This November, I urge you to cast your vote in favor of Proposition HH, an instrument of responsible property tax relief. In doing so, we can secure a brighter future for Colorado, where homeowners, renters, seniors and businesses can find much-needed respite from the ever-increasing burden of housing costs and property taxes.
State Rep. Barbara McLachlan represents Archuleta, La Plata, Montezuma and San Juan counties in the Colorado State Legislature. She is the chair of the House Committee on Education.