The Second Regular Session of the 74th General Assembly is well underway!
Learn more about CCLP’s legislative platform for 2024 and the bills we’re most excited to support!

News

Jan 31, 2023

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An expert in policy advocacy and coalition building, Chaer has dedicated her career to helping people meet their basic needs and expanding economic opportunity. She serves on the executive committee of the All Families Deserve a Chance (AFDC) coalition. Staff page ›

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CCLP’s legislative watch for April 5, 2024

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Who gets the tax breaks in the 2023 Colorado Legislature?

by | Jan 31, 2023

Income, Legislative Updates

Colorado is in a very odd situation.  Our legislators can’t raise taxes due to TABOR (Taxpayer Bill of Rights). Those are decisions left to voters, who often favor only the taxes they themselves do not pay. On the other hand, both the voters and legislators can cut taxes, or cut tax revenue with tax credits.  

This past fall, voters approved a ballot measure to cut the income tax rate permanently from 4.55% to 4.4%, reducing state revenues by over $400 million per year. Almost half of the tax savings goes to those who make more than $1 million per year — less than 1% of tax filers. About 75% of tax filers get less than $63 per year in tax savings1. It also benefits corporations, whether they are headquartered here in Colorado or not.  The measure does not reduce taxes for those who earn too little to owe income taxes, even as they pay a somewhat larger percentage of their income in various state taxes — sales, excise, and other taxes — compared to the wealthiest Coloradans.  

One way to help balance the impact of such tax cuts is through the expansion of the state Earned Income Tax Credit (EITC) and Child Tax Credit (CTC), both proven fighters of poverty, which are targeted to those Coloradans who see little or no benefit when the state income tax rate is reduced. For this session, a bill was referred from the Legislative Oversight Committee Concerning Tax Policy which would: 

  1. Double the current state EITC from 20% of the federal EITC to 40%,
  2. Increase the size of the state Child Tax Credit incrementally, and;
  3. Expand child eligibility from only children under six to children under 17, to align with the federal CTC. 

HB23-1112 is sponsored by Representative Shannon Bird, Senator Chris Hansen, and Senator Chris Kolker. The cost of the bill is approximately $460 million, but the legislation can be adjusted with an eye to balancing the tax cuts and credits that focus their benefits on the wealthiest individuals and corporations and reduce TABOR refunds for everyone else.   

Last year the legislature approved SB22-233 — advance payment of much of the TABOR rebate (the revenues collected above the TABOR cap of last year’s general fund plus inflation and population growth, which must be returned to Coloradans). This advanced payment was approved to be a flat $750 per tax filer. Yet, for future years, the TABOR rebate would revert to being returned to Coloradans through a six-tiered sales tax refund, in which the wealthiest Coloradans get much more than the Coloradans with the lowest income. The regressive nature of our tax structure is reflected in our TABOR rebate statute. This year’s legislation by Representative Chris DeGruy Kennedy and Senator Nick Hinrichsen will propose permanently replacing the regressive six tiers of payments with a flat amount, an arrangement by which the wealthiest tax filers would not receive more than those with lower incomes.  

Whenever we read about new tax breaks in Colorado, we should consider not just those who would benefit from it, but those who it would harm. TABOR drastically limits funding for the very services and programs on which some of the most struggling Coloradans rely. Perhaps our best chance to achieve more equity is to focus on to whom tax cuts, credits, and rebates go. 

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Recent articles

CCLP testifies in support of TANF grant rule change

Apr 15, 2024

CCLP's Emeritus Advisor, Chaer Robert, provided written testimony in support of the CDHS rule on the COLA increase for TANF recipients. If the rule is adopted, the cost of living increase would go into effect on July 1, 2024.

CCLP’s legislative watch for April 5, 2024

Apr 5, 2024

For the 2024 legislative session, CCLP is keeping its eye on bills focused on expanding access to justice, removing administrative burden, preserving affordable communities, advocating for progressive tax and wage policies, and reducing health care costs.

HEALTH:
HEALTH FIRST COLORADO (MEDICAID)

To maintain health and well-being, people of all ages need access to quality health care that improves outcomes and reduces costs for the community. Health First Colorado, the state's Medicaid program, is public health insurance for low-income Coloradans who qualify. The program is funded jointly by a federal-state partnership and is administered by the Colorado Department of Health Care Policy & Financing.

Benefits of the program include behavioral health, dental services, emergency care, family planning services, hospitalization, laboratory services, maternity care, newborn care, outpatient care, prescription drugs, preventive and wellness services, primary care and rehabilitative services.

In tandem with the Affordable Care Act, Colorado expanded Medicaid eligibility in 2013 - providing hundreds of thousands of adults with incomes less than 133% FPL with health insurance for the first time increasing the health and economic well-being of these Coloradans. Most of the money for newly eligible Medicaid clients has been covered by the federal government, which will gradually decrease its contribution to 90% by 2020.

Other populations eligible for Medicaid include children, who qualify with income up to 142% FPL, pregnant women with household income under 195% FPL, and adults with dependent children with household income under 68% FPL.

Some analyses indicate that Colorado's investment in Medicaid will pay off in the long run by reducing spending on programs for the uninsured.

FOOD SECURITY:
SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM (SNAP)

Hunger, though often invisible, affects everyone. It impacts people's physical, mental and emotional health and can be a culprit of obesity, depression, acute and chronic illnesses and other preventable medical conditions. Hunger also hinders education and productivity, not only stunting a child's overall well-being and academic achievement, but consuming an adult's ability to be a focused, industrious member of society. Even those who have never worried about having enough food experience the ripple effects of hunger, which seeps into our communities and erodes our state's economy.

Community resources like the Supplemental Nutrition Assistance Program (SNAP), formerly known as Food Stamps, exist to ensure that families and individuals can purchase groceries, with the average benefit being about $1.40 per meal, per person.

Funding for SNAP comes from the USDA, but the administrative costs are split between local, state, and federal governments. Yet, the lack of investment in a strong, effective SNAP program impedes Colorado's progress in becoming the healthiest state in the nation and providing a better, brighter future for all. Indeed, Colorado ranks 44th in the nation for access to SNAP and lost out on more than $261 million in grocery sales due to a large access gap in SNAP enrollment.

See the Food Assistance (SNAP) Benefit Calculator to get an estimate of your eligibility for food benefits.

FOOD SECURITY:
SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS AND CHILDREN (WIC)

Every child deserves the nutritional resources needed to get a healthy start on life both inside and outside the mother's womb. In particular, good nutrition and health care is critical for establishing a strong foundation that could affect a child's future physical and mental health, academic achievement and economic productivity. Likewise, the inability to access good nutrition and health care endangers the very integrity of that foundation.

The Special Supplemental Nutrition Program for Women, Infants and Children (WIC) provides federal grants to states for supplemental foods, health care referrals, and nutrition information for low-income pregnant, breastfeeding and non-breastfeeding postpartum women and to infants and children up to age five who are found to be at nutritional risk.

Research has shown that WIC has played an important role in improving birth outcomes and containing health care costs, resulting in longer pregnancies, fewer infant deaths, a greater likelihood of receiving prenatal care, improved infant-feeding practices, and immunization rates

Financial Security:
Colorado Works

In building a foundation for self-sufficiency, some Colorado families need some extra tools to ensure they can weather challenging financial circumstances and obtain basic resources to help them and their communities reach their potential.

Colorado Works is Colorado's Temporary Assistance for Needy Families (TANF) program and provides public assistance to families in need. The Colorado Works program is designed to assist participants in becoming self-sufficient by strengthening the economic and social stability of families. The program provides monthly cash assistance and support services to eligible Colorado families.

The program is primarily funded by a federal block grant to the state. Counties also contribute about 20% of the cost.

EARLY LEARNING:
COLORADO CHILD CARE ASSISTANCE PROGRAM (CCCAP)

Child care is a must for working families. Along with ensuring that parents can work or obtain job skills training to improve their families' economic security, studies show that quality child care improves children's academic performance, career development and health outcomes.

Yet despite these proven benefits, low-income families often struggle with the cost of child care. Colorado ranks among the top 10 most expensive states in the country for center-based child care. For families with an infant, full-time enrollment at a child care center cost an average of $15,140 a year-or about three-quarters of the total income of a family of three living at the Federal Poverty Level (FPL).

The Colorado Child Care Assistance Program (CCCAP) provides child care assistance to parents who are working, searching for employment or participating in training, and parents who are enrolled in the Colorado Works Program and need child care services to support their efforts toward self-sufficiency. Most of the money for CCCAP comes from the federal Child Care and Development Fund. Each county can set their own income eligibility limit as long as it is at or above 165% of the federal poverty level and does not exceed 85% of area median income.

Unfortunately, while the need is growing, only an estimated one-quarter of all eligible children in the state are served by CCCAP. Low reimbursement rates have also resulted in fewer providers willing to accept CCCAP subsidies.