At a glance
• Moffat County School Board voted to formally endorse Amendment 59, or Savings Account For Education.
• Proposed amendment would repeal provision in Taxpayers Bill of Rights requiring that tax surpluses to be refunded to taxpayers.
• SAFE would place surpluses in account for education for districts to use when other funding sources decrease.
• Amendment would not repeal TABOR provision requiring voter approval for tax increases.
The Moffat County School Board took a stand Thursday night on a proposed constitutional amendment that will be on the ballot this November.
At its monthly meeting, the board voted unanimously to support Amendment 59, called Savings Account For Education (SAFE). If passed, the measure would establish a state savings account for education using tax revenue surpluses.
Board member Jo Ann Baxter urged other members to vote in favor of the resolution. Baxter serves on the school board's Colorado Association of School Boards' legislative committee.
SAFE is an attempt to rectify conflicting amendments to the Colorado Constitution and provide a reserve fund for kindergarten through 12th-grade education, said Ralph Clark, SAFE field spokesman.
"This is an attempt to put in place a constitutional process that will probably alleviate a lot of the problems" caused by the Taxpayers Bill of Rights and other amendments, he said.
Setting up the SAFE
SAFE repeals a provision in TABOR requiring the state to refund tax surpluses to taxpayers. It does not affect another provision of TABOR that requires residents to vote on proposed tax increases.
Instead of refunding surplus tax dollars, the state would place the funds into a reserve fund that school districts can draw from during hard financial times.
"You can think of it as a rainy day fund," Clark said.
SAFE funds could be used only for education.
In years of stable economic growth, a two-thirds majority vote from both houses in the state legislature would be required before schools could use the funds. During years when the state's economic growth is slow or declining, a simple majority would be required.
Schools would be able to use SAFE funds only for uses designed to increase student achievement. Reducing class sizes, school construction and providing full-day kindergarten fall under this category.
SAFE also limits the amount of money that goes into the fund once it equals 8 percent of the amount used from the state General Fund and State Education Fund during the previous fiscal year.
Once the fund reaches its cap, additional tax dollars will be funneled into the State Education Fund.
Several state officials, including House Speaker Andrew Romanoff, crafted the amendment after several years of tax shortfall-caused funding cuts for education.
Clark touted the amendment as a solution to financial hang-ups for school districts and legislators.
"(SAFE) frees up the legislature to do a lot of things because they don't have to worry about" providing extra funds for education, he said.
The proposed measure does have potential downfalls.
Funds would be placed into the savings account only when there are tax surpluses. The state's history shows those surpluses aren't guaranteed.
Colorado hasn't had a tax surplus in eight years, Clark said, adding that economists project that the state won't have another surplus for five more years. There's no provision built into SAFE that would require the state to boost the fund if prolonged shortfall causes the account to dwindle.
"We'll have to cross that bridge in the future," Clark said.
He defended the amendment, saying SAFE probably will alleviate many of the funding woes created by conflicting amendments to the state's constitution.
Clark added that "probably" is the operative word, because the proposed amendment was crafted under the assumption that the state will again experience financial surpluses.
Clark was confident that the assumption would become a reality.
"There (have) been (surpluses) in the past, and there will be in the future," he said.
The proposed amendment could have another possible drawback.
SAFE would repeal Amendment 23, which requires per-pupil funding to increase by inflation plus 1 percent annually. The amendment is scheduled to sunset in 2011.
"By far, the most sign increase in our revenue comes" from Amendment 23, District Finance Director Mark Rydberg said.
Combined with student population growth, Amendment 23 funds accounts for 75 percent of school district's revenue growth.
"That's a huge chunk of our pie that has a very steady flow, a very predictable flow, of growth," he said.
The school district completes its student count in early October. Because of Amendment 23, Rydberg said he can calculate the lion's share of the district's new revenue by February or March.
However, budget planning won't be as easy if guaranteed funding provided by Amendment 23 goes away.
"When you're at the whim of the legislature giving you money, it's a lot more difficult to budget and to plan," Rydberg said, adding that the sums allotted by the legislature could vary from year to year.
"It's so much easier when you know the guarantee, compared to the guess," he said.