For the Regional Transportation District (RTD), TABOR Exemption Is Imperative to Continued Service

The Regional Transportation District (RTD) is moving forward with a ballot measure for this November to ask voters to extend their exemption from the Taxpayer’s Bill of Rights (TABOR) cap. This measure would, without imposing any new tax or increasing any tax rate, authorize RTD to continue to collect, retain and spend all revenues it receives from whatever sources without regard to the limitations set forth in the Taxpayer’s Bill of Rights (TABOR).  

The Commuting Solutions board has taken a position of support on this initiative and urges our members and supporters to vote in favor of the exemption extension.

In 1999, voters exempted RTD from the TABOR cap limitations for the purpose of repaying debt incurred to finance construction of the Southeast and Southwest light rail lines until bond repayment. Bond repayment will occur in November of 2024, meaning that about 50% of RTD’s revenue will be subject to the TABOR cap starting in 2025.

What is TABOR?

TABOR is a 1992 voter-approved amendment to the Colorado Constitution that limits the amount of revenue Colorado governments can retain and spend. TABOR requires voter approval to increase taxes or retain excess revenues above certain limits that TABOR sets, as well as to issue certain new multi-year financial obligations such as bond debt.

TABOR allows governments to retain and spend an annual amount based on the prior year’s actual revenue plus a growth factor. Revenues collected in a fiscal year that exceed these limits must be returned to taxpayers.

Many Colorado local governments, school boards and other governing bodies have sought and won voter-approved exemptions from TABOR’s revenue and spending limitations.

How Would Reintroducing the TABOR Cap Impact RTD’s Core Service?

Since revenues and local growth factors are hard to predict, projecting losses is somewhat difficult. Annual cuts could be between 7% and 10% of revenues subject to the cap, or perhaps between $10 million and $60 million.  If the TABOR Cap had been in place the last 10 years, RTD may have lost $600 million over 10-12 years.  This is money that has gone into providing bus and train services to millions.

Losing revenue will ultimately result in less service, which is the opposite of what our growing population needs. Raising fares to make up for some of the loss will ultimately lead to less ridership which is not sustainable.

RTD’s Financial Future

As with many transit agencies in the United State, Sales and Use Taxes are a large part of RTD’s revenue. Given the volatile nature of these sources, RTD is aiming to diversify its revenue in the long term.  You can learn more about the financial outlook by visiting their site: https://www.rtd-denver.com/about-rtd/financial-outlook

For those looking for a deeper dive into RTD’s operations, read “Fork in the Railroad: RTD’s Ridership Dilemma

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