In his Aug. 31 news conference at the State Capitol, and again the following week in testimony before a committee of the U.S. Senate, Gov. Hickenlooper unveiled a “bipartisan plan” for improving the disastrous health care reform system dumped on the nation by very partisan Democrats in 2010. Yet, the “pragmatic proposals” put forward by Hickenlooper and his six partnering governors do not address many of the most serious problems created by the Affordable Care Act, known to its millions of victims as Obamacare.
Every year, in preparation for tax day, Americans spend 6 billion hours trying to navigate the internal revenue code and federal tax regulations (now up to 10 million words). The compliance bill has now reached $409 billion. The last time Americans experienced major tax reform was in 1986, under President Reagan. In the past few decades, the tax code has grown to a size that is unmanageable and overly complicated. In the House, we’re working to deliver a tax reform plan that will deliver relief and results for all Americans.
Every American president, from Washington to Trump, has lost sleep over, complained about, and been furious with, the news media. While the language of the times has changed, presidential declamations regarding the Fourth Estate have been a constant over the years, only varying in intensity as particular POTUS outrages rose and fell.
And of course, it is no secret that President Trump finds great fault with much of the American news media. With the exception (usually) of Fox News, Mr. Trump has castigated the press corps in terms generally not seen in prior administrations, culminating with the declaration that the press is the enemy of the people. The press seems most intent on reporting those stories that Mr. Trump would most earnestly wish they did not, all the while creating what he has declared to be “fake news” with abandon.
It may not come as a shock, therefore, that the Trump administration is, according to inside sources, considering four separate but related legislative proposals that could simultaneously address his campaign promises regarding illegal aliens in the United States while also curbing what his administration considers reckless press behavior.
The first three legislative proposals, dealing with illegal aliens, has several specific proposals the president feels will simultaneously decrease the number of illegal aliens in the country, while also boosting the president’s ability to deal with the current and any future alien issues, and to keep us safe. Within these three proposed laws are provisions that would make the path to citizenship more challenging, and therefore would help ensure that only the very best immigrants are allowed to become citizens. For example, the legislation would increase from five to 14 years the period necessary for an alien to become a full U.S. citizen with full voting rights. Therefore aliens with little true interest in becoming true and good Americans would be removed, while those with the character and the quality we want, will stay for the long haul.
A second proposal would address head-on the challenge of dealing with potentially harmful aliens being allowed to live in the U.S. almost indefinitely during immigration hearings on their status. This new law would give the president the power to label aliens from countries “at war” with the United States as “enemy aliens” who could then be promptly deported. Thus a process that once took months or years could be shortened to perhaps days, while increasing the president’s power to keep us safe.
Likely the most controversial of the four proposed laws would give President Trump an important new power to deal with the “fake news” phenomena. In the 21st century, traditional news media outlets have morphed into a huge number of news operations, from social media to blogs to internet radio and more. Thus, the traditional limits placed on media in the past — largely self-regulated commitments to truth and balance — are nearly all gone. Anyone with a computer and an opinion can create the impression of being a news source with no responsibility to the truth, with nary a consequence for false and harmful reporting. Thus, today all too many “news” outlets are spreading what might be called sedition rather than beneficial information. Therefore, the final proposed law attempts to return to the news media that which is lost — a consequence for dishonesty.
The proposal would make it illegal to write, print, utter or publish, or cause it to be done, or assist in it, any false, scandalous, and malicious writing against the government of the United States, or either House of Congress, or the president, with intent to defame, or bring either into contempt or disrepute, or to excite against either the hatred of the people of the United States, or to stir up sedition, or to excite unlawful combinations against the government, or to resist it, or to aid or encourage hostile designs of foreign nations.
While recognizing the importance of a free press, President Trump hopes that this new legislation will impose on the press that which it self-imposed for generations — a commitment and obligation to the truth. Clearly, he argues, the modern press cannot be trusted to self-regulate, and such a failure is far too dangerous to ignore in an era of instant communications.
Taken as a whole, with these four legislative proposals, President Trump hopes to take care of the preverbal two birds with one stone — a reduction in the number of illegal aliens while also ensuring an increase in the quality and “wholesomeness” of those immigrants allowed in, while also returning the press to an era of integrity, fairness and honesty.
So what do you think? Sound good?
I am guessing, gentle reader, that as you read the previous paragraphs you found yourself either in agreement that the time has come to get tough on the issues of illegal aliens and press sedition, or you were concerned that these proposed laws were not the answer. And perhaps, as you perused, you heard an echo from the past?
I hope so, because, of course, there are no such proposed laws. The Trump administration has most certainly shown a distain for the press, and the president did, in fact, once tweet that the press was the enemy of the American people. So it almost makes a bit of sense that these “new” laws might be considered by those at 1600 Pennsylvania Avenue. There is something that seems fitting in these laws and our president’s point of view.
These laws are not, however, new. They come from one of the darkest periods in our nation’s history. The four laws I described above are what were known as the “Alien and Sedition Acts of 1798.” These laws, passed by the Congress and signed by President Adams, sought to reduce the influence of Thomas Jefferson’s political wing, and those that admired the French. The Acts were purely a political power grab — an effort to keep the Federalists in power while keeping Mr. Jefferson’s Democratic-Republicans at bay. Some 14 individuals would be charged under the Acts and a couple ended up in jail, before common sense prevailed. Since that time, our nation has accepted that we want immigrants (though, of course, within a proper legal framework) to come to our nation, and we definitely don’t want any one person, a president or other, to have the power to declare by fiat a person to be an enemy of the state. And it is most certainly an American value that criticism of the government is a deeply protected right.
But in this hyper-partisan time, when disagreement is often declaimed to be un-American, I worry that some readers might have supported the powers I proposed to give President Trump in the 21st Century. Making it harder to become a citizen and making it easier to punish “bad” media members might sound appealing to those who feel themselves oppressed. But please consider the implications to your own freedom should those you oppose achieve high office while vested with such powers.
It is normal and proper to become frustrated with the media, be you the POTUS or a fry cook. But please consider carefully the full implications of any reductions in press freedom. Mr. Putin, an authoritarian leader with powers comparable to those described above, may claim a popular mandate, but without a free press one can never truly know. Our current president has, in my view, far too often expressed an admiration if not an affinity for Putin. I find this very troubling, and I urge the reader to consider the implications of a US President with such powers.
While the alien and sedition acts might seem a fitting tool for 2017 to some, I hope to most it offers a moment of pause and a deep reflection on the implications of too-powerful a president. The echoes of history can teach us a great deal. A clear lesson would seem to be that freedom is the value most worth defending. And without a free press we may be only a few steps away from a Putin in the White House.
President Trump visited Springfield, Missouri and laid out his plans for reforming our nation’s outdated, complex and uncompetitive tax system. The president’s plan is built around an America-first tax system that is focused on jobs, increasing wages and wealth in America, and restoring the American dream.
The Business Roundtable conducted a survey of their CEOs and 90 percent responded that delaying tax reform will harm the U.S. economy by causing slower economic growth, hiring, and capital investment. Fifty-seven percent of the responding CEOs say delaying tax reform means their company will delay capital spending, the investment that drives jobs and growth. Fifty-six percent say their companies will delay hiring plans.
President Trump believes lower taxes and higher wages will result in a better life for all Americans and make the American dream more accessible than ever before. The Colorado Business Roundtable enthusiastically endorses a tax-reform plan that: simplifies our tax code in a way that is fair to all Americans; leads to job creation and higher wages; provides tax relief for the working and middle class, and paves the way for repatriation of funds parked off-shore back to the United States.
Our current tax code has increased in length and complexity so that 94 percent of U.S. taxpayers needed some form of help to file their returns, according to National Taxpayers Union, and 91 percent of small businesses hired a professional to do their taxes, according to the National Federation of Independent Business. Taxpayers spend over 6 billion hours annually complying with the tax code, according to the IRS’s Taxpayer Advocate Service. Complying with current tax code — which is six times longer today than it was in 1955 — places a $262 billion burden on the economy.
Colorado’s economy depends on 892 U.S. companies that actively operate internationally, competing in global markets on a daily basis for inputs, capital and customers. These globally engaged companies directly and indirectly contributed $148.8 billion to the Colorado economy in 2013, according to a Business Roundtable report. Focusing on tax reforms that benefit Colorado workers; that are simple and fair; that set a competitive rate that drives job creation and higher wages, is something every Coloradan should champion.
“If we don’t have tax reform sometime this or early next year, a lot of the business investment that’s been predicated on getting tax reform done will have been poorly made,” said J.D. Foster, senior vice president and chief economist at the U.S. Chamber. “Business investment will likely contract significantly, and we will have a significant period of economic weakness in my opinion.”
Our economy is healthy when we grow at roughly 3.5 percent. Since 2007, it has been below 2.5 percent consistently. Significant and generational tax reform is at the core of President Trump’s plan to return to over 3 percent growth. A 3 percent growth rate will yield a nominal gross domestic product that is $16 trillion larger, generate $2.9 trillion in federal government revenue, and raise wages and salaries of American workers by $7 trillion, according to administration estimates.
Fixing our broken tax code for families, small businesses, workers and job creators is the single most important action we can take to grow our economy and help the middle class get ahead. If we are successful in this once-in-a-generation opportunity to make taxes simpler, fairer and lower for hard-working Colorado families, we can encourage entrepreneurs to reinvest in their businesses and American companies to bring back jobs and profits trapped overseas.
“CEOs overwhelmingly believe that tax reform is the most effective way to put more Americans to work in a stronger, growing economy. The Trump administration’s recent release of its tax proposals was a significant step forward as they work with Congress on pro-growth reform legislation. By demonstrating the importance of tax reform to business and the U.S. economy, these survey results confirm that tax reform is a critical priority if we are to grow the economy and create jobs and opportunity,” said Business Roundtable President and CEO Joshua Bolten.
Colorado Business Roundtable strongly encourages our congressional delegation, leadership, and the administration to pass meaningful and permanent tax reform. If you are interested in joining business leaders, chambers and associations in advocating for a fairer, simpler and more competitive rate, please contact us at email@example.com
Former U.S. House Speaker Tip O’Neill said famously that all politics is local. But you wouldn’t know it if you look at voter participation in local elections.
There are over 5.5 million people living in Colorado, and over 3.7 million registered voters in Colorado, yet only 1,244,365 people voted in local elections in 2015. Compare that to 2,855,960 Coloradans who cast ballots in the 2016 national election — one of the highest voter participation rates in the nation.
2017 will have important races for city and town councils, mayoral races, school board races and rural electric races. These positions impact jobs, wages, your neighborhood, education for your kids and grandkids, the environment, civil rights and equality, broadband, energy sourcing, growth policies, contracting opportunities, transportation, and quality of life. These local campaigns are often powered by the hard work of volunteers, not deep-pocketed contributors.
If we’re going to enact the change we need, we need to lead locally first.
It’s tempting to exhaust our political energy on Donald Trump and the dysfunctional Republicans in Congress right now. But unless Republicans in Congress suddenly grow spines and start holding Trump accountable, we’re stuck with him for the next three-plus years.
Leading locally can be an even more powerful and productive use of our time.
Right now, there is a local progressive candidate in your area who is up for election in 2017. They don’t just need your vote, they need your help. As a candidate for office many times over, I know that a campaign is only as strong as its base of volunteers.
If everyone reading this column volunteered on just one school board candidate, one town council candidate, one mayoral race or one rural electric administration race, we would be able to enact enormous positive change for all Coloradans at the local level, and put a local check on one-party Republican rule in Washington. That’s why we’re calling on everyone to lead locally and commit to adopting one local race in your area in 2017.
If you’re sick of Republicans in Washington refusing to address jobs that pay a living wage, then go out in 2017 and help elect a mayor who will raise wages in your area
If you’re concerned that Trump Education Secretary Betsy DeVos is going to gut your local public schools, then go out in 2017 and help elect a school board candidate who will protect your kids’ public education.
If you’re upset that Trump has withdrawn from the Paris Climate Accord, then go out in 2017 and help elect candidates who will address air quality, sprawl and support renewable energy at the local level, or help elect a progressive majority to the board of the Rural Electric Association.
There is so much we can do at a local level to make our lives and our neighbors’ lives better by getting the right people into office. That’s why we’re encouraging Coloradans to adopt a local race and pour your energy into these local campaigns right now in 2017.
There are many other benefits to getting involved in local races. First, you’re helping to cancel out the corrosive effect of big money on politics. Federal law allows corporations and the super-wealthy to dump vast sums of money into our elections, but they can’t match an army of grassroots volunteers committed to social change.
Second — when you get involved locally, you have the very best chance of meeting and getting to know your local candidates, and that amplifies your voice. You make an investment in your community. You lead by example about how democracy should work. There’s also a social benefit — political campaigns are a place where people can come together to achieve a common goal. Local leadership can be a role model to the country on how solve problems and put the needs of people and communities first.
Finally – practice makes habit. Americans who volunteer on political campaigns once tend to make a habit of it. The skills you gain working on a local campaign can be put to use in 2018 and 2020 and beyond.
Instead of focusing on what we can’t do in Washington, we should focus on what we can do in our own communities. You can visit coloradodems.org to find your current elected officials and what districts you live in. You can also ask your city or school board for a list of all filed candidates. Every single registered voter will receive a mail ballot for the November 2017 election.
Know your power. Adopt a race. Vote. Volunteer. Be heard. This year, in 2017, let’s commit to leading locally and electing responsive, accessible, diligent, hard-working candidates to local offices across the state.
Colorado Politics recently published an article titled: “Where do left and right converge? On local growth,” in which the author repeats the anti-development sentiments of a college student in the Springs.
Unfortunately, Colorado Politics made the same error as the student-journalist: Both did not call either the city of Colorado Springs or the local or state Homebuilders Association to better understand this issue. So now, I feel I have to set the record straight.
The premise of the student’s opinion is flat wrong. The city of Colorado Springs employs a program that requires developers to install the necessary stormwater improvements or pay fees into the drainage basin under a sophisticated system. This longstanding approach by the city is to periodically evaluate each drainage basin by engaging a qualified engineer, determine the required facilities and then determine a fee based on acres served. The developers construct the facilities required, dedicate the necessary land and get a credit against the fees for doing so. If they don’t build facilities, they pay the required fees into the basin account. It’s a requirement for construction.
The primary challenges faced by the city and the development community include:
Over the years, TABOR left the city no alternative other than to squeeze the stormwater maintenance budget for the improvements that the developers provided. In short, the revenue-strapped city shifted the general fund budget to overall city operations (fire, police etc.) and less to facility maintenance, neglecting the improvements that they required. Where is the logic in blaming the development community? The neglected repairs and maintenance set up a truly “pay me now or pay me later” situation. The circumstances created a significant pay me later approach. Later is now, and it’s far more expensive.
The specifications for stormwater management are constantly evolving due primarily to changing and more stringent federal regulations. This directly impacts the drainage basin calculations, especially if enacted at the retiring end of a basin. The fees can become irrationally high, forcing the city to step in and mitigate the burden.
The engineering philosophy for stormwater management has evolved over the years from an initial system that drained the city as soon as possible after a storm event with lots of concrete channels, to a system requiring more land contributions that is based on detention ponds, preserving natural characteristics and vegetation. The previous system was more maintenance intensive. The new systems are better, but more expensive to construct, and now drainage fees paying for the stormwater improvements represent as much as $5,000 per new home.
It is the city’s obligation under federal law to maintain the stormwater system, plain and simple. By agreement, through the development approval processes, developers provide the systems and dedicate the land and facilities to Colorado Springs based on city specifications and approved plans. The city — i.e. the collective residents — needs to pay for maintenance, upgrades and improvement of the stormwater facilities over time. The stormwater fee approach is the most direct allocation system for this necessary expense and is similar to programs employed by most other communities around the state and country.
Developers also construct and dedicate streets, parks and utility connections, as required by the new development that are then maintained by the city and utility providers. Those long term maintenance expenses have been a challenge for the city as well and are generally paid by the city tax collections.
The obvious analogy is purchasing a new car and neglecting to maintain your new vehicle and then blaming the manufacturer for the resulting damages. I guess that it’s easier to blame “rapacious” developers for alleged nefarious activities than really taking the time to study and truly understand the situation. Perhaps a conversation with the city or a developer would be appropriate—for anyone concerned with the stormwater issue.
I can only think of one candidate for the U.S. Congress I ever agreed with on nearly every issue. And it was me, during my own run for the House in 2008, here in Colorado District 5. And even then, I’d have second thoughts as I got new information. I’d re-evaluate what I thought was best for the people of CD-5 and Colorado. I committed to, if elected, working very hard to represent my constituents properly.
Of course, therein lies the rub – what does it mean to properly represent the people? Some people will say that true representation is when you do what the people want you to do. Others disagree, and assert that you should do what you think is in the best interest of the people, even if that leads to a decision that is politically unpopular at the moment. Which is correct?
When I taught political science at the Air Force Academy, I would talk to the cadets about the “delegate vs. steward” models of representation. The delegate model says that the elected official is to be just that – a delegate who simply votes in the way the people who elected him or her want. Government by popular opinion. Makes sense, right? Simple!
But the steward model says that, once elected, you are exposed to more and better information about the details of the issues. Therefore, you should vote in the peoples’ best interest, even if that is a momentarily unpopular position. The argument goes like this – you follow your doctor’s guidance when you are sick because you assume that your doctor has more information than you do about your illness, and that he or she is better positioned to tell you what to do, even if the medicine tastes bad. So, if you elected your senator or member of Congress, you presumably sent that person to D.C. to do a deep-dive into the issues so that they can make an informed decision – one that you presumably would have made, had you the time and information available to you. So, act as a steward of the public trust. Makes sense, right? Simple!
So which is correct? I used to tell my students that if they were ever stuck for an answer to a question from me in class, the odds were pretty good that if they said “Sir, that depends” they’d have a better than average chance of being correct. Because in politics, lots of things depend. We like the delegate model when we know exactly what we want our elected representative to do. Heck, we pay their salaries! So vote like I want you to vote! It’s so simple!
Unless, of course, it depends. Because some issues (cough… health care…cough) are famously complicated and a too-simplistic evaluation can lead to a bad decision and bad policy. Just as you want your doctor to have extensive knowledge of obscure health challenges, we want our representatives to also have extensive knowledge of policy issues. What should be our policy toward Saudi Arabia? Toward Israel? On climate change? Heck, on which bridges to fix first? How about nukes? Do you want to deploy nuclear weapons on the basis of deep and insightful thought by, say, 30-year defense expert Sen. John McCain, or should we use your gut feeling? I say we need experts to do deep-dives into the subject and come back with a vote that is in our best interest. We need a steward. Mostly. Usually. Except when we don’t.
During both my own run for Congress, and the four years I spent as a Senate staffer, working on thousands of military and veteran cases I often saw the challenge of delegate vs. steward representation. I took calls from hundreds of Coloradans demanding that my boss vote a particular way on a particular issue because the correct course of action was “obvious.” Of course, about half the callers disagreed with the other half on what was the obvious solution.
In class, the “delegate vs steward model” was a useful tool to help teach the concept of representation. In the real world, every elected official bumps up against the implications of the model every day. So which is correct? As I said, both and neither. There are issues wherein the representative will usually vote in line with the perceived will of the people back home. These tend to be the “simpler” things, such as the bills now racing through Congress for hurricane relief. But the more complex issues will nearly always lead to a difficult decision for the representative. Do you vote the way the people want you to today, or do you vote in what you believe is their long-term best interests, even if it ticks off folks back home at the moment?
I believe, based on my own personal experience, that most elected representatives are good and honorable people, at all levels of government, doing the very best job they can do. There are exceptions, but most are good folks. And I particularly admire those who take the unpopular stand because they feel it is the right thing to do in the long run, even when there might be more immediate electoral consequences. In my old Senate boss’s first campaign, he was asked about a vote he might be asked to take, and would he still favor the bill if he knew it would cost him the election. He said yes, and he meant it. I think we need more of that courage. We need more stewards when being a delegate would be easier. And we need more voters who take the time to become better informed on the issues, and who therefore understand how rarely issues are just black or white, especially in the long term. Because that’s where, to borrow a phrase from a terrible old movie, we will spend our lives – in the future.
So, after 1,021 words, I argue for our elected representatives to vote more often with their minds than on their poll numbers. But, remember that I lost my election, to a gentleman who seems far more tilted toward the delegate model. Perhaps that’s the lesson? I rather hope not.
Over the month of August, my team and I traveled over 1,700 miles across the 3rd Congressional District and state of Colorado, making over 30 stops to discuss the most pressing issues facing our nation. I had the privilege of visiting with local economic development leaders, county commissioners, school boards, health care providers, veterans groups, substance abuse professionals and many others — including U.S. Environmental Protection Agency (EPA) Administrator Scott Pruitt. He visited the Gold King Mine site on the two-year anniversary of the toxic spill to reassure the community that the EPA is prioritizing cleanup of the site and will make those impacted by the spill whole.
There are a few themes that I heard throughout the month no matter where I was, and it is clear that jobs and the economy, health care, and the nation’s opioid abuse epidemic are top of mind for many Coloradans.
In Colorado, we have a tale of two economies. While resort towns and major metropolitan areas are thriving, there are many communities on the Western Slope, Front Range, and in the San Luis Valley where families are struggling. The legacy of heavy-handed federal regulations is still preventing the private sector in these communities from creating jobs and supporting economic security.
According to the Small Business Administration’s 2016 statistics, small businesses support 49 percent of Colorado’s workforce. Small businesses are truly the backbone of our state’s economy, and we must do everything we can to support entrepreneurs and job creators. Unfortunately, a 2014 study by the Brookings Institute showed an alarming trend: in recent years, the number of small businesses that have shut down exceeds the number that have opened their doors. Nowhere has this trend been felt more profoundly than in rural America, where small businesses are responsible for approximately two-thirds of all jobs.
As a former small business owner, my focus in Congress has been on advancing policies that will create an environment where we see more businesses opening than closing each year. When more businesses open, struggling families have more job opportunities and a better chance at achieving financial stability.
While it takes time to undo nearly a decade of harmful regulatory policies, we are making progress on this front in the 115th Congress. So far this year, Congress passed and the president has signed 14 congressional resolutions of disapproval that roll back unnecessary, overly burdensome federal regulations, and the House passed the REINS Act (H.R. 26), which would require Congressional approval of any regulation that would have an economic impact of $100 million or more. Although we still have a long way to go, I am confident that we are heading in the right direction to deliver more job opportunities and economic stability to families in the 3rd Congressional District.
The Colorado Division of Insurance recently announced that premiums in the state’s individual health insurance market will increase by 26.7 percent on average in 2018. This is on top of the 20 percent increase in 2017 and 24 percent increase in 2016. The trajectory is unsustainable and unacceptable. We must repeal and replace the so-called Affordable Act and bring affordable health insurance to the 3rd Congressional District.
In May, the House made important progress towards this goal by passing the American Health Care Act (AHCA). The bill would drive down the cost of health insurance and bring competition and choice to the market, while ensuring that individuals who have pre-existing conditions maintain access to affordable health insurance. In addition to the AHCA, the House also passed bills to begin medical tort reform — an issue that needs to be addressed in order to drive down health care costs — and allow small businesses and associations to provide insurance options for their employees or members across state lines, which will give individuals and families more choices when it comes to their insurance coverage. These bills were the Protecting Access to Care Act (H.R. 1215), Small Business Health Fairness Act of 2017 (H.R. 1101), and the Competitive Health Insurance Reform Act (H.R. 372).
The Senate has not yet passed the AHCA or a health care bill of its own that would allow both chambers to compromise on final legislation. It is beyond time for the Senate to act.
As I have traveled our district to speak with the men and women who work on the front lines of the opioid abuse epidemic, it has become clear to me that Colorado has some of the most dedicated doctors, nurses, counselors, and substance abuse professionals in the country. The president recently declared the opioid abuse epidemic a national emergency, and I have been committed to ensuring our communities have the resources they need to develop and sustain prevention, treatment, and recovery programs.
In 2016, the 21st Century Cures Act and Comprehensive Addiction and Recovery Act (CARA) were both signed into law. These bills authorized programs to provide states with more resources to expand opioid abuse prevention and treatment efforts. As a result of these bills, Colorado received $7.8 million to support prevention, treatment, and recovery services, and the Department of Health and Human Services has made $75.9 million in competitive grants available to state mental health and substance abuse agencies.
I continue to receive feedback on how the federal government can better support Colorado’s efforts to fight the opioid abuse epidemic, and I’m committed to incorporating this feedback into policy decisions that are made in Washington.
Congress has a full agenda between now and the end of the year. If you have any questions about bills that are up for a vote or my work on your behalf, please do not hesitate to give my office in Washington, DC, a call at 202-225-4761. You can also write to me on my website, www.tipton.house.gov.
Congress reconvenes to tackle tax reform after Labor Day, but the Colorado Senate has been hard at work on tax cuts all August.
Our state’s small businesses are currently overburdened by high taxes and unnecessary filing costs. According to a 2017 Tax Foundation report, Colorado’s state business tax climate ranks 16th in the country — behind neighboring Utah and Wyoming. While our state is still light years ahead of high-tax states like California and Connecticut — thanks to many of our free-market legislators — our neighbor to the north ranks first overall. Wyoming’s mix of low corporate and individual income taxes translates to a favorable business climate, where job creators can survive and thrive.
While Colorado’s young, educated labor supply and high quality of life set our state apart, more work can be done. A separate Forbes ranking places the Centennial State’s business costs at 40th in the country. This turns off entrepreneurs and shifts start-ups to other states.
One reason is the business personal property tax, which inundates small business owners with needless filing costs. The tax requires businesses to file an annual inventory of “business personal property” — a broad category including manufacturing equipment, computers, and bookshelves — along with the year it was acquired. Each piece of equipment is then assessed a tax, which adds up to millions of dollars every year.
Keeping track of inventory is difficult enough, let alone paying for it. In Gov. Hickenlooper’s words, the business personal property tax is a “headache for small businesses.”
Cutting the tax would free up more money for business expansion and job creation, a potential boon for Colorado’s economy. There are more than 572,000 small businesses in Colorado, employing one million employees — roughly half of the state workforce. These small businesses are responsible for nearly 33,000 new jobs per year.
This helps all of the state’s diverse communities. Of the roughly 572,000 small businesses in Colorado, 45 percent are minority-owned, bringing resources and career opportunities to urban and rural areas. A healthier business environment leads to new locations, increased wages, and more jobs for all Coloradoans.
Federal tax cuts can only speed up the process. Congress has not substantially updated the tax system since the Tax Reform Act of 1986, which reduced and simplified rates. More than three decades later, our tax code runs more than 70,000 pages long — turning headaches into migraines.
As it stands now, the overwhelming majority of Colorado’s small businesses (95 percent) are federally taxed as pass-through entities, which means their income is “passed through” to their owner to be taxed at his or her highest marginal individual tax rate. More than half of all business income is earned by pass-through entities.
However, depending on the business, pass-through taxes can reach 40 percent. Combined with state and local taxes, Colorado’s small business owners often pay up to 50 percent of their income in taxes. This is money not being reinvested into the state economy and our workforce.
President Trump has proposed a 15 percent pass-through tax rate, which could save small business owners countless money and time. A pass-through tax cut would end up helping employees, who depend on job creators for financial security.
While the Trump administration and Congress hammer out the details, Colorado lawmakers focus on making our state taxes more competitive. When Colorado opens its doors to business, hardworking Coloradoans reap the benefits.