Opponents label C and D a tax increase in disguise

By Dan MacArthur
North Forty News

Berthoud State Rep. Kevin Lundberg concedes it may appear he is among the lonely few high-profile opponents swimming against a seemingly insurmountable tide of support for Referenda C and D.

That's so even within his own Republican party, in which the measures have created an unprecedented public split perhaps more evident in Larimer County than anywhere else in the state.

Lundberg and Loveland representative Jim Welker--with the backing of the party's executive board--have been outspoken in their opposition to C and D. Their position has put them at odds with fellow local legislators, Rep. Bob McCluskey and Sen. Steve Johnson, a key player in the compromise that led to development of C and D.

McCluskey and Johnson, Fort Collins Republicans, were among the nearly three quarters of state legislators who favored putting C and D on the ballot. Other supporters include the governor and other GOP heavy hitters avidly advocating the companion referenda allowing the state to retain $3.7 billion in tax revenues to better finance health care, education and transportation.

The editorial pages at both the major Denver daily newspapers have strongly asserted their support for the measures as have untold numbers of city and county governments and civic and professional organizations.

But Lundberg is convinced that when the votes are all counted, it's the cheerleaders who will be swamped--if a poll of his District 49 constituents is any indication. Of those responding, Lundberg said 68 percent preferred receiving refunds under the Taxpayers' Bill of Rights rather than rolling it back into the state budget.

"I don't really consider that alone," said Lundberg. "I think elected officials are sticking their necks out going the other way."

He said those statistics also support his contention that C and D is a contest between the power structures in the state: big government and big business--and the people.

"I believe it is in the best interest of the people of Colorado that we put money in their pockets," said Lundberg. "This is not an economic recovery act. This is a take-money-out-of-your pocket act."

Lundberg contended that it could cost a family an average of $3,000 in the first five years, a figure that conflicts with the $491 cost estimated by the non-partisan Legislative Council.

Despite claims to the contrary, he said C and D are an obvious effort to gut the 1992 Taxpayers' Bill of Rights. TABOR was aimed at limiting the growth of state government spending by limiting annual increases to the amount of inflation and population growth.

"I've never been so disappointed with our governor. He's trying to kill TABOR," agreed Loveland City Council member Walt Skowron. He unsuccessfully attempted to persuade the council to officially oppose C and D.

"Shall it or shall it not limit the size of government? This is what it's all about," said Lundberg. He believes TABOR has been effective in its goal of limiting the growth of government and should be kept intact. Otherwise, he said, there's no pressure for government to seek efficiencies and become more productive.

Lundberg scoffs at the claim of C and D supporters that the state is in a severe financial crisis that can only be cured with more revenues. "The legislature needs a kick in the pants to get back to living within our means," he said.

In rejecting the measures, he said, voters would send the legislature a strong message to focus its priorities and live within its means.

Far from starving, Lundberg said, the overall state budget remains bloated. Last year alone, he said, the budget increased 7 percent. The real problem, according to Lundberg, is uncontrolled spending and C and D would only make it worse.

"I see far too many excesses to be convinced we're at the minimum," he said. "Referendum C doesn't fix the problem; it simply feeds the system."

Similarly, Lundberg said he sees no reason to repair the so-called "ratchet effect," which he regards as an intentionally demeaning term. In fact, he said, the mechanism has been effective in forcing government to tighten its belt like everybody else during tough times.

The ratchet results when state revenues decline below those of the previous year, as they did during the recession earlier this decade. When that occurs a new, reduced spending base is established on which the following year's budget is built.

Critics charge that the ratchet effect has the unintended consequence of limiting the state's ability to provide additional services needed after the economy starts to recover. But Lundberg responds that it has worked exactly as it was intended by limiting the growth of government.

Skowron also dismisses claims that C and D are not a tax increase but measures that allow the state to retain revenues that otherwise would be rebated. "It's just a bloody lie," he said. "If you don't return it to me for five years, that's a tax. It's a no-brainer."

In exchange for this massive tax increase, Skowron objects, voters will get only vague promises that the money will go toward transportation, education and health care.

"When you give the government a blank check, you don't have any control over that money," he said. "Whatever promises they make for C and D, you can't count on them."