Opinion ID: 1161019
Heading Depth: 1
Heading Rank: 8

Heading: Proposed Initiative Number 1997-98 # 62

Text: The title as designated and fixed by the board is as follows: AN AMENDMENT TO THE CONSTITUTION OF THE STATE OF COLORADO CONCERNING THE ESTABLISHMENT OF AN INCOME TAX CREDIT FOR PARENTS OR LEGAL GUARDIANS OF CHILDREN ENROLLED IN PUBLIC, NON-PUBLIC SCHOOLS AND NON-PUBLIC HOME-BASED EDUCATIONAL PROGRAMS, AND, IN CONNECTION THEREWITH, REQUIRING THE GENERAL ASSEMBLY TO ESTABLISH AN INCOME TAX CREDIT FOR INCOME TAX YEARS BEGINNING IN 1999; SPECIFYING THE METHODS FOR DETERMINING THE AMOUNT OF SUCH CREDIT; ESTABLISHING PRIORITIES FOR ELIGIBILITY FOR SUCH CREDIT; ESTABLISHING AN EDUCATIONAL OPPORTUNITY FUND TO BE USED TO OFFSET THE ENTIRE COSTS OF SUCH CREDIT; PROHIBITING REDUCTIONS IN CURRENT PER-STUDENT PUBLIC SCHOOL EXPENDITURES AS A RESULT OF THE MEASURE OR AS A RESULT OF THE TRANSFER OF STUDENTS TO NON-PUBLIC SCHOOLS; PROHIBITING THE STATE OR ANY POLITICAL SUBDIVISION THEREOF FROM USING THIS SECTION TO INCREASE THEIR REGULATORY ROLE OVER THE EDUCATION OF CHILDREN IN NON-PUBLIC SCHOOLS BEYOND THAT EXERCISED AND EXISTENT ON JANUARY 1, 1998; AND ELIMINATING ELIGIBILITY FOR THE INCOME TAX CREDIT OF PARENTS OR LEGAL GUARDIANS WHO SEND CHILDREN TO CERTAIN NON-PUBLIC SCHOOLS, INCLUDING THOSE THAT ILLEGALLY DISCRIMINATE ON THE BASIS OF RACE, ETHNICITY, COLOR OR NATIONAL ORIGIN OR TEACH HATRED. The ballot title and submission clause as designated and fixed by the Board is as follows: SHALL THERE BE AN AMENDMENT TO THE CONSTITUTION OF THE STATE OF COLORADO CONCERNING THE ESTABLISHMENT OF AN INCOME TAX CREDIT FOR PARENTS OR LEGAL GUARDIANS OF CHILDREN ENROLLED IN PUBLIC, NON-PUBLIC SCHOOLS AND NON-PUBLIC HOME-BASED EDUCATIONAL PROGRAMS, AND, IN CONNECTION THEREWITH, REQUIRING THE GENERAL ASSEMBLY TO ESTABLISH AN INCOME TAX CREDIT FOR INCOME TAX YEARS BEGINNING IN 1999; SPECIFYING THE METHODS FOR DETERMINING THE AMOUNT OF SUCH CREDIT; ESTABLISHING PRIORITIES FOR ELIGIBILITY FOR SUCH CREDIT; ESTABLISHING AN EDUCATIONAL OPPORTUNITY FUND TO BE USED TO OFFSET THE ENTIRE COSTS OF SUCH CREDIT; PROHIBITING REDUCTIONS IN CURRENT PER-STUDENT PUBLIC SCHOOL EXPENDITURES AS A RESULT OF THE MEASURE OR AS A RESULT OF THE TRANSFER OF STUDENTS TO NON-PUBLIC SCHOOLS; PROHIBITING THE STATE OR ANY POLITICAL SUBDIVISION THEREOF FROM USING THIS SECTION TO INCREASE THEIR REGULATORY ROLE OVER THE EDUCATION OF CHILDREN IN NON-PUBLIC SCHOOLS BEYOND THAT EXERCISED AND EXISTENT ON JANUARY 1, 1998; AND ELIMINATING ELIGIBILITY FOR THE INCOME TAX CREDIT OF PARENTS OR LEGAL GUARDIANS WHO SEND CHILDREN TO CERTAIN NON-PUBLIC SCHOOLS, INCLUDING THOSE THAT ILLEGALLY DISCRIMINATE ON THE BASIS OF RACE, ETHNICITY, COLOR OR NATIONAL ORIGIN OR TEACH HATRED? The summary prepared by the Board is as follows: This measure requires the general assembly to establish an income tax credit for the education expenses incurred by parents or legal guardians of children enrolled in public and non-public schools. The measure also requires the general assembly to create an educational opportunity fund from which the amounts required to offset the entire cost of the tax credit are to be taken, including reimbursement to the state for any resulting decrease in tax revenues and the payment to parents or legal guardians of the amount of their refund that exceeds the amount of their tax liability. The measure requires that all savings created by a reduction in public school enrollments attributable to transfers of students to non-public schools on and after the effective date of the measure be transferred to the fund. The measure establishes a variable income tax credit amount. For the tuition costs of each child in non-public schools, the income tax credit will be an amount not less than either 50% of the yearly state average public school expenditure per student for all purposes by the state and by local school boards in the prior complete school year or 80% of the cost of tuition paid in the applicable tax year plus such other education expenses allowed by law, whichever is less. For the tuition costs of each special needs student enrolled in non-public schools, the income tax credit will be an amount determined by the general assembly that recognizes the higher cost of educating such children. For parents and legal guardians of public school students, the income tax credit will be the maximum amount available, as determined by law. Parents or legal guardians of children who participate in a non-public home-based educational program shall be eligible for an income tax credit only for curricular materials and educational supplies as provided by law. The measure requires that eligibility for the income tax credits be prioritized for purposes of distributing the amount of money available in the educational opportunity fund. The first priority shall be for parents or legal guardians of any student who transfers from a public school district that is below the state average in student performance to a non-public school after the effective date of the measure and for parents or legal guardians of any special needs student. If any moneys remain in the educational opportunity fund, they shall first be applied to an income tax credit for parents or legal guardians of any student who transfers from any other public school district to a non-public school after the effective date of the measure. If any moneys remain in the fund, they shall then be applied to an income tax credit for low income parents or legal guardians of students in non-public schools. If moneys still remain, they shall be applied to all other parents or legal guardians of students in non-public schools. Finally, if moneys remain in the fund, they shall be applied to an income tax credit for parents or legal guardians of public school students and parents or legal guardians of any student participating in a non-public home-based educational program. The measure makes parents or legal guardians ineligible for the income tax credit if they send their children to a non-public school that discriminates on the basis of race, ethnicity, color or national origin, advocates unlawful behavior or teaches hatred of any person or group on the basis of race, ethnicity, color, national origin, religion, or gender, or knowingly employs a person convicted of a crime involving lewd or lascivious conduct or any offense involving molestation or other abuses of a child. The measure prohibits a reduction in current per-student public school expenditures and an increase in total state or district expenditures, as adjusted for inflation, as a result of this measure or as a result of the transfer of students to non-public schools in Colorado after the effective date of the measure. The measure also prohibits the state or any subdivision thereof from using the measure to increase its regulatory role over the education of children in non-public schools beyond that exercised and existent on January 1, 1998. The proposed initiative is estimated to have no fiscal impact on school districts, since the districts will continue to be appropriated funds to cover the costs of students enrolled in public schools. Non-school district local governments are not impacted by the bill. The measure's fiscal impact on state government in the first year of the implementation is estimated to be $639,653 for costs associated with creating an income tax credit, including costs for programming, printing, mailing new forms and processing rebate checks. The costs of implementing the proposed income tax credit on an annual basis thereafter is estimated to be $464,653. In order to ensure that income tax credits are distributed in priority order, and still comply with current deadlines for refunds, the program would be run as a separate rebate program rather than as part of the income tax system. As such, the program would require a separate form for each person claiming the rebate. There could be additional costs involved in tracking students who leave the public schools. All of the above costs would be paid from the Education Opportunity Fund. Hearing adjourned March 18, 1998, at 2:52 p.m. April 1, 1998 Rehearing  Mr. John S. Outcelt Motion for Rehearing granted in part, denied in part, to address the title, ballot title and submission clause only. Rehearing adjourned April 1, 1998, 2:15 p.m. The proposed initiative is as follows: Be it enacted by the People of the State of Colorado: Article IX of the constitution of the state of Colorado is amended BY THE ADDITION OF A NEW SECTION to read: Section 17. Educational Opportunity Tax Credit. (1) The people of the State of Colorado, desiring to improve the quality of education available to all children, adopt this section to enable the greatest number of parents and legal guardians to choose among the widest array of quality educational opportunities for their children. (2) Notwithstanding any provisions of section 7 of this article, section 34 of article V, section 4 of article II, or section 2 of article XI, the General Assembly shall (a) create a refundable state income tax credit for education expenses incurred by parents or legal guardians of children enrolled in public and non-public schools and (b) create an Educational Opportunity Fund from which the amounts required to offset the entire cost of the tax credit shall be drawn, including the reimbursement to the state for the resulting decrease in tax revenues and the payment to parents or legal guardians of the amount of their refund if the amount of their refund exceeds the amount of their tax liability. This refundable tax credit shall be available with respect to education expenses incurred beginning in the 1999 tax year. (3) The amount of the tax credit will be: (a) for tuition costs of each child in non-public schools, amounts established by law that are not less than either 50% of the yearly state average public school expenditure per student for all purposes by the state and by local school boards in the prior complete school year or 80% of the cost of the tuition paid in the applicable tax year plus such other education expenses allowed by law, whichever is less. (b) for tuition costs for each special needs student as defined by law who is enrolled in non-public schools, an amount to be determined by the General Assembly that recognizes the higher cost of education for said children. (c) for parents and legal guardians of public school students, the maximum amount available as may be determined by law. (4) The tax credit shall be made available to eligible persons in a time and manner determined by law. Eligibility for the tax credit shall be prioritized as follows: (a) The first priority for distribution shall be parents or legal guardians of any student who hereafter transfers to a non-public school from a public school district that is below the state average in student performance as measured by assessments approved by the state board of education, and parents or legal guardians of any special needs student as defined by law. (b) The remaining funds in the Educational Opportunity Fund shall then be applied to the next priority, parents or legal guardians of any student who hereafter transfers to a non-public school from any other public school district. (c) The remaining funds in the Educational Opportunity Fund shall then be applied to the next priority, low income parents or legal guardians of students in non-public schools. (d) The remaining funds in the Educational Opportunity Fund shall then be applied to the next priority, all other parents or legal guardians of students in non-public schools. (e) The remaining funds in the Educational Opportunity Fund shall then be applied to the next priority, parents or legal guardians of public school students and parents or legal guardians of any student who is participating in a non-public home-based educational program. (5) All savings created by a reduction in public school enrollments attributable to transfers of students to non-public school on and after the effective date of this section shall be transferred to the Educational Opportunity Fund, which shall be used to offset the entire cost of the tax credit provided for in subsections (3) and (4). (6) Current per-student public school expenditures shall not be reduced nor shall total state or district expenditures, as adjusted for inflation, be increased as a result of this section or as a result of the transfer of students to non-public schools in the State of Colorado after the effective date of this section. (7) Parents or legal guardians of children who participate in a non-public home-based educational program shall be eligible for the tax credit only for curricular materials and educational supplies as provided by law. (8) Parents or legal guardians who send children to a non-public school that discriminates on the basis of race, ethnicity, color or national origin; advocates unlawful behavior, or teaches hatred of any person or group on the basis of race, ethnicity, color, national origin, religion, or gender; knowingly employs a person convicted of a crime involving lewd or lascivious conduct, or any offense involving molestation or other abuses of a child, shall not be eligible for this tax credit. (9) Except as herein provided, neither the state nor any subdivision thereof shall use this section to increase its regulatory role over the education of children in non-public schools beyond that exercised and existent on January 1, 1998.