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In this Oct. 22, 2019 file photo, a sign stands outside a home for sale in southeast Denver. (AP Photo/David Zalubowski, File)

The debate over how to tackle rising property taxes is poised to dominate the final days of Colorado’s 2022 legislative session, as Gov. Jared Polis, Democratic lawmakers and Colorado Concern, a deep-pocketed business organization, hastily negotiate a plan to provide relief that’s sufficient but that doesn’t also deny local governments billions in future funding. 

With just two weeks left in the lawmaking term, the high-stakes conversations, which have been happening behind the scenes for months, are getting more intense. 

Polis and Democrats are trying to quickly introduce and pass property tax reduction legislation to head off a 2022 ballot measure from Colorado Concern, a nonprofit that represents the interests of the state’s top business executives, that would permanently cap property tax increases. 

While everyone generally agrees that something needs to be done to reduce Coloradans’ property tax tabs, there is a wide chasm when it comes to how and how much. As of Tuesday, the policy details of the deal were still very much in flux.

The legislation could come in many different forms, including a property valuation rate reduction. Lawmakers have also set aside $200 million for property tax relief, but it’s unclear how they would spend it. 

It appears any deal would only be temporary, lasting as few as two years, as both sides work toward finding a long-term solution. 

“There are a lot of cooks in the kitchen,” said Senate President Steve Fenberg. “We just need to get (the bill) right before we introduce it.”

Asked if there were any specific options on the table, Fenberg didn’t directly answer, only saying that Democratic leadership at the Capitol is trying to figure out the policy proposal that would “provide the most relief.”

Then-Colorado Senate Majority Leader Steve Fenberg, D-Boulder, makes a point during a news conference on the west steps of the Colorado Capitol. (AP Photo/David Zalubowski)

This is the second year of end-of-session debate around property taxes — which fund schools — at the Colorado Capitol. In 2021, lawmakers passed an 11th-hour bill temporarily slashing property tax valuation rates and recategorizing properties for taxation purposes in order to blunt the effect of an ultimately unsuccessful ballot measure pushed by conservatives that would have resulted in a much larger property tax cut.

Those involved in the discussions this year have said they are essentially negotiating under threat: if they don’t pass a property tax relief bill, Colorado Concern could move forward with a measure siphoning as much as $1.3 billion in expected tax revenue from local coffers in its first year. 

“It’s kind of an unfortunate way of having conversations about what the proper policy is for moving forward,” said House Speaker Alec Garnett, D-Denver. “It’s not a great way of governing. It’s not the best way of doing business.”

Garnett says he doesn’t see a permanent fix on the horizon, which means it’s possible — if not likely — that the annual property tax debate continues as property values rise and property taxes continue to follow suit. 

Colorado Concern, however, sees its proposal — which would cap property valuation increases at roughly 3% for taxation purposes — as that permanent solution. 

“The measure provides critical relief for taxpayers while balancing the needs of local communities who depend on tax revenue to fund essential services,” Mike Kopp, a former state lawmaker who leads Colorado Concern, said in a written statement earlier this year when the proposal was unveiled. 

Polis’ office said in a statement Tuesday night that “the governor will continue to partner with the state legislature and local leaders to save Coloradans money.” 

Progressives, meanwhile, led by the liberal-leaning Bell Policy Center, are pleading with Democrats this year not to give up too much in their efforts to keep Colorado Concern from moving forward with a ballot measure. They fear a major property tax reduction would spell disaster for school and local government funding.

“Let’s not let Colorado Concern dictate the terms of how we solve this,” said Scott Wasserman, who leads Bell.

Colorado Concern has filed a host of similar proposed ballot measures as it works to determine which to advance. But a poll commissioned by the Bell Policy Center indicated that one of Colorado Concern’s main proposals, Initiative 75, which would cap property value increases at 3% for taxation purposes, lacks enough support to pass in November. 

Fifty-two percent of those polled said they would vote for the measure, while 28% said they would vote against it and 20% said they were completely undecided or had no lean whatsoever. Initiative 75 would need the support of 55% of voters to pass since it would amend the constitution. 

In this Oct. 22, 2019, photo a sign stands outside a new home for sale in southeast Denver. Rising property values in Colorado have led to a steep increase in property taxes. (AP Photo/David Zalubowski, File)

The poll was conducted April 18-20 by Democratic pollster Strategies 360 among 600 likely 2022 Colorado voters. It had a margin of error of 4 percentage points. 

Colorado Concern has proposed other, similar ballot measures that wouldn’t require a constitutional change and thus could pass with a simple majority. But the general rule of thumb for ballot measures in Colorado is that they only pass when they poll well above what’s needed for passage. 

“I don’t think they have nearly as strong a hand as they are publicly saying they are,” Wasserman said.

The poll also indicated there is far more support for progressive property tax relief ballot measure ideas being pushed by Wasserman, including one that would enact an extra tax or fee on homes worth more than $2 million. But Wasserman doesn’t appear to have the financial backing needed to collect the roughly 125,000 signatures required to get his ideas on the ballot. 

“That’s the elephant in the room,” he said, “isn’t it?”

Looming over the frenzy is Initiative 110, a proposed ballot measure filed by conservative fiscal policy activist Michael Fields that would cap property tax increases at 2% annually. Fields said he is not part of the negotiations with the governor’s office and Colorado Concern.

“We’re waiting to see what the deal is,” he said.

Lawmakers were slated to be briefed by the governor’s office Tuesday on the latest negotiations with Colorado Concern. 

Senate Majority Leader Dominick Moreno, D-Commerce City, said it’s unlikely a bill will be introduced until early next week. 

Jesse Paul is a Denver-based political reporter and editor at The Colorado Sun, covering the state legislature, Congress and local politics. He is the author of The Unaffiliated newsletter and also occasionally fills in on breaking news coverage....