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For the first time since voters repealed the Gallagher Amendment in 2020, the rising costs of public schools will fall primarily on the state government this year, and not local taxpayers.
The shift is sure to be welcome news for many Colorado homeowners. Across years of explosive growth in home values, property owners have borne the brunt of the state’s efforts to eliminate Colorado’s school funding shortfall.
But for state budget writers, it couldn’t come at a worse time.
In January, the Joint Budget Committee approved $64 million in additional spending on schools in this year’s budget, bringing the state’s total contribution to K-12 operations up to $5.6 billion. If approved by the full legislature this month when it considers its annual package of midyear budget revisions, that would deepen the $1 billion financial hole the state must dig itself out of in the 2025-26 budget year, which starts July 1.
The budget revision would increase the state’s contribution by 11.8% this year versus the 2023-24 school year. The local share will remain essentially flat, rising just 0.2% from a year ago.
There are two reasons for the midyear addition. Enrollment was higher than expected when lawmakers approved the budget last spring, while local property tax collections were $64 million lower, thanks to tax relief bills passed by the legislature.
The rising cost to the state won’t end with this year’s budget, according to projections from the governor’s Office of State Planning and Budgeting.
The state would get a slight reprieve under the governor’s budget request next year, when its share of total K-12 program spending is expected to drop about 4%. But the state’s share is expected to climb in each of the following three years as property values level out, eclipsing $6 billion by 2029 — 56% of the total expected cost.
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THE UPS AND DOWNS OF THE STATE SHARE
This time last year, Colorado looked like it was on the verge of a milestone in school funding. For the first time since before the passage of the Taxpayer’s Bill of Rights in 1992, the local share was nearing 50%.
That represented a dramatic reversal from a decade earlier. In 2015, local property tax rates had fallen so dramatically thanks to the collision of TABOR and the property tax-limiting Gallagher Amendment that the state was footing 67% of the cost of K-12 education. And even that wasn’t enough to fully fund schools under the state constitution.
In the 2024 legislative session, lawmakers approved a bill that signaled a desire for school district taxes to climb even higher. In Senate Bill 233, lawmakers for the first time separated the tax assessment rates of schools and local governments, allowing the legislature to provide property tax relief without cutting schools too deeply. The bill also established a mechanism to cut school taxes automatically — but only if the local share reached 60% of the total cost of schools.
Former state Rep. Chris deGruy Kennedy, a Lakewood Democrat who now leads the liberal Bell Policy Center, told The Colorado Sun that a 60% local share wasn’t a goal, per se. But it was a level that lawmakers felt they could live with long term. If local taxes rose enough that the state had to contribute only 40% this year, for instance, it would cut its school finance bill by $1.6 billion, more than enough to cover the state’s budget deficit.
Months later, during the 2024 special session on property taxes, that section was repealed and replaced with deeper K-12 tax cuts and a cap on their growth.
As a result, this budget year — rather than falling to 51% as was once anticipated — the state share of K-12 education will tick back up to 57%.
That leaves budget writers with less money to spend on state services like Medicaid and higher education. It also has lawmakers considering how to rein in the growth of K-12 spending, just one year into fully funding schools.
WHAT TO WATCH THIS WEEK
THE BIG STORY
Dave Williams reflects on his tenure as party chairman, hints that he may not seek another term
The Colorado GOP posted a video over the weekend of Chairman Dave Williams speaking last month to a group of supporters in Garfield County. It provides a rare glimpse of the embattled party leader speaking candidly about his future and how his tenure has gone.
One big takeaway: Williams seemed to hint that he may not run for another two-year term as chairman in March, when his current term ends. He made a few remarks to the effect of how the party would operate “if I don’t run” again.
Williams didn’t respond to questions from The Unaffiliated about whether he will seek another term as chairman.
Some other highlights from the hourlong recording:
“Imagine what we could have done had the party been unified,” Williams said toward the end of his remarks, blaming his opponents for those fractures.
Many Republicans, of course, would blame Williams for the party divisions that have dominated his tenure.
Williams said his message to his naysayers is “at the next (party leadership) election, make your case as to why we should do something different.”
“Don’t try to destroy and blow up the party in the middle of the most consequential election in the history of our country,” he said.
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THE POLITICAL TICKER
GUNS
State Sen. Nick Hinrichsen, D-Pueblo, is one of the first Democrats in the legislature to express opposition to Senate Bill 3 as written.
Hinrichsen said while he supports the parts of the measure banning devices that can make semiautomatic weapons fire at a rate similar to an automatic weapon, he opposes the parts that would ban the manufacture and sale of certain semiautomatic rifles, shotguns and handguns that can accept detachable ammunition magazines.
“I believe that, broadly, semiautomatic firearm ownership by law-abiding individuals is protected by the Second Amendment,” he wrote in a statement. “I also have very little confidence that this provision would decrease the amount of casualties in a mass shooting. … Given the precedent set by the Bruen decision, I also have some doubts that the Supreme Court would uphold this component of the bill, were it to go into effect.”
Hinrichsen’s vote isn’t needed to pass Senate Bill 3. It has enough original cosponsors in the Senate to clear the chamber as is.
PERSONNEL FILE
Jeff Small, who served as chief of staff to Republican U.S. Rep. Lauren Boebert for her first two terms in Congress, has joined the political firm 76 Group as a principal.
Small left Boebert’s office Jan. 3. He was replaced by Rory Burke, the former longtime legislative director for Republican U.S. Rep. Paul Gosar of Arizona.
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CAMPAIGN FINANCE
Congressional campaigns, state parties file year-end campaign finance reports
Congressional campaigns, political action committees and state political parties filed their quarterly campaign finance reports with the Federal Election Commission on Friday, providing a glimpse into who had money heading into 2025 and who ended last year broke.
The reports covered fundraising and spending from Nov. 26 through Dec. 31. Here are the highlights:
The Colorado Democratic Party reported having $358,712 cash on hand at the end of the year after spending $158,000 during the reporting period. The largest share of the spending went to payroll.
The Colorado Republican Committee reported having $240,000 in cash on hand at the end of 2024 after paying Williams’ LLC $10,000 during the reporting period.
THE BIGGER PICTURE
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