DENVER – Critics on both sides of the aisle are increasingly concerned that Governor Hickenlooper’s massive $1 billion tax hike offers far too few benefits for its estimated economic cost, as the Colorado and national economy struggle to recover.
The liberal University of Colorado recently published a study that found Amendment 66, the education tax increase that accompanies changes to school funding formulas, offers three years of marginal public sector job growth at the expense of 26 years of decreased private sector hiring.
The measure would result in a decrease of over $400 million of personal income, according to the study.
“The first three years have an average of 12,630 more jobs… However, compared to the baseline scenario, the increase is nullified over the long-run horizon (2014-2040) as direct employment growth is countered by slower growth in other sectors due to the tax increase,” according to the report.
Through 2040, Colorado would lose 13,400 jobs, and 6,500 in the first five years, according to the report.
This narrative is juxtaposed with Governor Hickenlooper’s adamant support the new revenue.
“[There is] no better… economic development we [can] do,” the Governor said at the campaign kick-off of Amendment 66 in August.
But the evidence is mounting against the tax-hike, as pro-business groups have come out to oppose the measure, including the National Federation of Independent Business, the South Metro, Glendale, and Grand Junction chambers of commerce, and Club 20.
“In all, the economy would lose $224 million in economic activity on average over the first 5 years if the measure passes and a loss of $993 million 2019-2040,” according to Common Sense Policy Economic Roundtable, a Colorado-based think tank.
Critics of Amendment 66 have argued that throwing money at K-12 does little to solve the achievement gap Americans face, especially without safeguards to ensure the funds are used directly for students, and not bureaucratic expenses.
“[W]hen calculating the correlation between graduation rates and per pupil funding across Colorado school districts from 2007-2012, the relationship between K-12 funding and performance was found to be tenuous,” according to the report’s authors, Richard Wobbekind and Brian Lewandowski.
Despite an infusion of national money, the campaign effort supporting approval of Amendment 66 has failed to gain traction, with just 35 percent of likely voters in support of the measure, according to a recent public poll.