Untimely Error
Colorado recently called a special session among legislators to fix an error that caused the loss of millions of dollars in tax revenue for several major recipients.
According to The Denver Post, this special session, called by Gov. John Hickenlooper, is the first special session request in five years, and it is an unusual step for Hickenlooper, who normally defers legislative decisions in these cases. However, he felt that the severity of this mistake warrants a closer look.
“RTD already has pressure on its budgets, and losing $6 million per year through an inadvertent mistake is making a difficult revenue situation even worse.”
The issue was initially discovered at the end of June, after the legislative session had drawn to a close. Denver’s Regional Transportation District (RTD, the city’s local public transportation company) along with some other local organizations, appear to have suffered because of Senate Bill 267, a measure that overhauled state hospital funding and increased a special cannabis sales tax from 10 to 15 percent.
“RTD greatly appreciates the General Assembly and Governor Hickenlooper stepping forward to address the Senate Bill 267 error as quickly as possible,” Scott Reed, assistant general manager of communications for RTD, told CULTURE. “The leadership of the General Assembly, the administration and the sponsors of SB-267 have all acknowledged that SB-267’s removal of voter-approved funding for special districts was an inadvertent mistake, and they are working to quickly remedy that error through a special session. Many special districts have been negatively impacted, losing a total of approximately $10 million per year.”
Reed stated that the erroneous bill cost customers money and took a toll on the organization as a whole. “As just one example, the SB-267 error is costing RTD customers approximately $500,000 per month,” he explained. “RTD already has pressure on its budgets, and losing $6 million per year through an inadvertent mistake is making a difficult revenue situation even worse. RTD’s funding was approved by voters initially in 1973, increased by voters in 2004, and its revenues were ‘de-Bruced’ by voters in 1995, 1999 and 2004. The error in SB-267 in effect thwarts the clearly-expressed will of voters.” De-Brucing means bypassing spending restictions set forth by former legislator Douglas Bruce.
“In my experience and according to their publication FYI Sales 93: Sales Tax on Marijuana, the Department of Revenue still requires dispensaries to pay the RTD taxes,” Nick Richards, Esq., of Dill Dill Carr Stonbraker & Hutchings PC in Denver, explained to CULTURE. “So this appears to be a fight regarding how to use the money. I think it will take an act of congress for RTD to recoup the lost funds.”
The results of this special sessions will determine whether or not the RTD and other organizations looking to recoup their money will be successful.
