Ballot Fiscal Measures — Romer Institute of Evidence-based Policy

Evidence Analysis of Colorado’s 2026 Ballot

The Fiscal Measures

Introduction

A total of fourteen referred and initiated statewide measures will appear on Coloradans’ ballots this November. Of those fourteen, four make changes to the State’s budget through various mechanisms, ranging from increasing taxes on high-income individuals and corporations to diverting existing sales tax revenue from the State’s General Fund to conservation efforts. This memo will explore what each measure does, how they could impact the State’s budget, and what happens if any combination of these measures pass.

The Measures

The four statewide ballot measures covered all impact either the state budget, tax rates, or the TABOR revenue limit. Each measure’s main points are described below.

Proposition NN – Raises the TABOR Limit and Keeps Excess Revenue for Education

What it does: This measure would allow the state to keep and spend revenue it would otherwise be required to refund to taxpayers, in an amount equal to what the state spends on K-12 public education each year.
What it means: If this measure passes, it will eliminate TABOR refunds for the foreseeable future and spend those funds on education. Otherwise, there is no tax increase and no new state revenue.
Who put it on the ballot: The Colorado General Assembly through Senate Bill 26-135.
Fiscal impact: $329.9M in FY27, $521M in FY28, varied in future depending on TABOR refunds; eliminates refunds both years; $100k income will lose $28 as single filer or $56 as joint filer in FY27.
Where the money goes: It directs a 2% annual increase in K-12 education funding for 10 years (FY 2026-27 through FY 2035-36), funded through any revenue retained from increasing the TABOR limit. How school districts may spend the new "positive factor" funding is restricted to teacher pay increases, teacher retention, lower class sizes, and career/technical education. The measure creates a Children's Account in the General Fund to hold retained revenue, with remaining funds (beyond the education increase) directed to child care, preschool, and children's services.

Proposition 136 – Limit the Income Tax Rate

What it does: Caps the state income tax rate in state statute at the current rate of 4.4%.
What it means: The income tax rate stays the same. If this passes and receives more votes than Amendment 87, if it also passes, this measure could blunt the graduated rate structure in Amendment 87. The rates below 4.4% in the proposed amendment could take effect while the rates over 4.4% may not. This may be subject to judicial or legislative review.
Who put it on the ballot: Michael Fields with Advance Colorado and Suzanne Taheri.
Fiscal impact: None. If this passes with more votes than Amendment 87, this could result in lower tax revenue, since tax rates would be lowered for some taxpayers.
Where the money goes: Not applicable.

Proposition 137 – Sporting Goods Sales Tax Diversion for Conservation

What it does: This measure would divert existing sales tax revenue on sporting goods away from the state’s general fund to a special cash fund dedicated to conservation efforts. There is an exception to the diversion if it would impact state tax credits for low-income households.
What it means: No new tax will be imposed. This would reclassify this revenue that is currently subject to the state’s TABOR limit as not subject to TABOR. This leaves more space under the TABOR cap, making it harder to reach and effectively lowering TABOR refunds.
Who put it on the ballot: Brendan Witt of Western Resource Advocates, and Aaron Citron of The Nature Conservancy.
Fiscal impact: $175M in FY2027-28 and $180.2M in FY2028-29. The measure reduces general fund revenue in year without a TABOR surplus, and would decrease TABOR refunds in FY2027-28.
Where the money goes: The funds would be allocated according to the following percentages:
- 47.5% to the Great Outdoors Colorado program
- 47.5% to wildfire prevention and watershed protection
- 2.5% to Colorado’s Outdoor Equity Grant program
- 2.5% to Colorado’s Outdoor Recreation Industry Office

Amendment 87 – Graduated Income Tax

What it does: Changes the state constitution to allow graduated tax rates and changes the state’s income tax rate from a flat rate of 4.4% for all income levels to a graduated rate structure varying from 3.7% to 8.4%.
What it means: Individuals, households, and businesses with taxable income under about $510,000 p[SN1] er year would pay less in income taxes, while those with taxable income over that amount will pay more in taxes. The tax cuts are relatively small, while the tax increases are large. This does not impact TABOR refunds.
Who put it on the ballot: Chris deGruy Kennedy with the Bell Policy Center and Kiayana Newell with the Protect Colorado’s Future Coalition.
Fiscal impact: $950 million in FY 2026-27, which is a half-year impact, and about $1.98 billion in FY 2027-28.
Where the money goes: All funds must supplement and not supplant public K-12 education, publicly funded healthcare, or early childhood education or care. The measure does not specify the allocations to each bucket of funding, so it will be determined by the legislature if this measure passes.

Background

The last several years have seen a proliferation of fiscal ballot questions. The Taxpayer’s Bill of Rights requires that any increase in tax revenue or rates be approved by a vote of the people in Colorado. Additionally, citizens can initiate measures on the ballot. This process can be very costly, however. Reporting suggests that it costs over $2 million to pay all of the costs associated with collecting signatures and the rest of the process to get an idea on the ballot for Coloradans to vote on.

Fifteen fiscal ballot measures have passed since 2005, eleven of which have passed since 2020. Most of these measures have increased taxes and specified how the new state funds will be spent. A table of all of the fiscal measures that have passed can be found in the Appendix.

TABOR

The Taxpayer's Bill of Rights (TABOR), approved by Colorado voters in 1992, limits the amount of revenue the state is permitted to retain and spend or save each year. TABOR allows the state to retain and spend an amount based on the prior fiscal year's actual revenue or limit, whichever was lower, and also requires voter approval for tax increases, while Referendum C, approved by voters in 2005, suspended the revenue limit from 2006 to 2010 and modified how the limit is calculated in subsequent years.

TABOR requires that revenue collected above this limit for a given fiscal year be refunded in the following fiscal year, but the constitution doesn't mandate any particular refund mechanism. The General Assembly is allowed to select "any reasonable method of refunds," including temporary tax credits or rate reductions, and doesn't require refunds be proportional "when prior payments are impractical to identify or return." The two primary refund mechanisms currently in place are the senior homestead property tax exemption and the six-tier sales tax refund.

Since 1992 when TABOR passed, fourteen years have resulted in TABOR refunds and five years were a “timeout” period when all revenue was kept by the state (per voter-approved Referendum C. [1]

Fiscal Impact Comparison

Each of these measures has a slightly different impact to taxpayers and to the state budget. The impact to taxpayers comes in the form of:

Lower taxes for taxpayers earning under $500,000 per year (Amendment 87)
Higher taxes for taxpayers earning over $500,000 per year (Amendment 87)
No new direct taxes paid (Propositions NN, 136, 137)
Smaller TABOR refunds, depending on state revenue collections (Propositions NN and 137)

The table below shows the amount of state revenue collections and changes in TABOR refunds for the current and next two fiscal years.

State Revenue and TABOR Impacts
Measure	FY 2026-27		FY 2027-28		FY 2028-29
Measure	Revenue	TABOR Refund	Revenue	TABOR Refund	Revenue	TABOR Refund
Amend. 87	$958.4M	-	$1,980M	-	$2,060M	-
Prop. NN*	$329.9M	-$329.9M	$521M	-$521M
Prop. 136	$0	-	$0	-	$0	-
Prop. 137	$0	-$175.0M	$0	-$180.2M	$0	-$185.6M
*Proposition NN does not collect new revenue but retains revenue that would otherwise be refunded to taxpayers. Source: Legislative Council Staff Blue Book fiscal estimates; author’s calculation in FY2028-29.

State Revenue and TABOR Impacts

To put these new funds into context, it is important to understand how these measures would impact state spending relative to current spending. Only Amendment 87 and Proposition NN directly increase state spending, since Proposition 137 diverts existing state revenue to specific purposes. While Proposition 137 does not increase spending directly, it may over time, as it lowers revenue subject to TABOR, giving the legislature more funds to spend.

Starting in the current fiscal year, FY 2026-27, the state would have an additional $1.3 billion to spend if Amendment 87 and Proposition NN pass. That equates to a 2.6% increase in total state funds appropriated for the same fiscal year, which includes cash funds and federal funds. If only considering General Fund dollars, that is a 7.4% increase in spending. [2]

The chart below represents the current (dotted line) and potential TABOR revenue limit under Proposition NN (solid line). Additionally, current revenue subject to TABOR and revenue subject to TABOR if Proposition 137 passes are represented in the bars. This shows the relatively small difference in revenues subject to TABOR but the large difference in TABOR revenue limits.

Each measures’ distribution requirements provide funding to existing state programs. Current funding for these programs and the incremental funding they would receive if these measures pass are shown in the table below. The figures below are illustrative of how and which programs would be funded, since Amendment 87 and Proposition NN give ultimate spending decisions to the state legislature.

Measure	Program	Current State Funding	Additional Funding under Measure – FY 2027-28
Amendment 87	K-12 education (CDE)	$5.6B	$1.98B
	Medicaid (HCPF)	$6.1B
	Early Childhood Education (CDEC)	$308.7M
Proposition NN	K-12 Education	$5.6B	$521M
	Child Care	$37.6M
	Preschool	$147.9M
Proposition 136	-	-	-
Proposition 137	GOCO	$90.0M*	$83.1M
	Wildfire Prevention	$16.4M	$83.1M
	Watershed Protection	$0.8M	$83.1M
	Colorado’s Outdoor Equity Grant program	Up to $4M	$4.4M
	Colorado’s Outdoor Recreation Industry Office	$1.1M	$4.4M
*FY2024-25 from GOCO’s website. Source: Joint Budget Committee Appropriations Report FY2026-27.

Combination Scenarios

The impact to the state and to taxpayers differs depending on the combination of these measures that pass or fail. If conflicting measures pass, they may be interpreted by the courts or the legislature, which could differ from the scenarios below.  Any combinations not listed would not impact each other. For reference, here are brief descriptors of each measure:

Proposition NN – Raises the TABOR Limit and Keeps Excess Revenue for Education

Proposition 136 – Limit the Income Tax Rate

Proposition 137 – Sporting Goods Sales Tax Diversion for Conservation

Amendment 87 – Graduated Income Tax

1. Proposition NN + Proposition 137
Proposition 137 would reduce the revenue subject to TABOR. Because this revenue would no longer count toward the TABOR limit, the state would have to collect roughly $175 million more before reaching the limit, which reduces or eliminates refunds in surplus years and reduces what Proposition NN would retain.[SN1]  This would reduce the revenue over the TABOR limit that would be used to fund K-12 public education and other priorities under Proposition NN.

2. Amendment 87 passes, Proposition 136 fails (or passes with fewer votes)
All of the new graduated income tax rates would take effect.

3. Proposition 136 passes, Amendment 87 fails (or passes with fewer votes)
The income tax rate would be capped at 4.4%, at least until voters or the legislature approve a higher or lower rate, respectively, in a future year.
If Amendment 87 passes with fewer votes than Proposition 136, the income tax rates below 4.4% proposed in Amendment 87 could take effect, which would lower state revenue collections.

4. NN + Amendment 87 (+/- Proposition 137)
Proposition NN would replace the revenue limit put in place by Referendum C with the new Proposition NN cap and eliminate TABOR refunds for the current forecast period (through FY 2028-29) and possibly beyond.
Graduated income tax rates would take effect under Amendment 87, both increasing and decreasing taxes for individuals and corporations, collecting additional state revenue. This amendment would have no impact on TABOR refunds.
If Proposition 137 also passes, it would lower revenue subject to TABOR, which will lower the amount of state funds allocated to Proposition NN priorities by $175 million during the first year it takes effect.

5. NN + Proposition 136 (+/- Proposition 137)
Proposition NN would increase the TABOR cap and eliminate TABOR refunds for current forecast period (through FY 2028-29) and possibly beyond.
Proposition 136 would cap the income tax rate at 4.4%, but if Amendment 87 does not pass, this has no impact on state revenue.
If Proposition 137 also passes, it would lower revenue subject to TABOR, which will require an initial $175 million in additional revenue to hit the TABOR revenue limit and start to fund the priorities passed by Proposition NN.

6. All four pass (assuming Amendment 87 receives more votes than Proposition 136)
Proposition NN would increase the TABOR cap and eliminate TABOR refunds for current forecast period (through FY 2028-29) and possibly beyond.
Proposition 137 will require the state to collect additional revenue to hit the prior TABOR limit before the programs under Proposition NN are funded.
Graduated income tax rates would take effect under Amendment 87, both increasing and decreasing taxes for individuals and corporations, collecting additional state revenue.
If Proposition 136 passes but receives fewer votes than Amendment 87, it will not likely limit the income tax rate.

7. All four pass (assuming Proposition 136 receives more votes than Amendment 87)
The only difference from Scenario 6 would be that the income tax rate would be capped at 4.4%, so any increases in the income tax rates under Amendment 87 would not take effect.
If the lower rates under the amendment take effect, total revenue to the state would decline.

OTHER Considerations

TABOR revenues comprise both general funds and cash funds. Tax revenue, and some fees, are deposited into the General Fund and are available for flexible uses. Cash funds can be either tax or fee revenue and are earmarked for specific expenditures. The state legislature has the ability to raise fees without going to the voters for approval. When a new cash fund fee is implemented, the revenue is subject to TABOR, unless approved by voters. When cash fund revenue subject to TABOR increases, it increases total revenue subject to the TABOR revenue limit. The state is required to refund General Fund monies to voters if the limit is exceeded, while cash fund revenue is untouched.

Currently, if cash fund fees are increased, it reduces the amount of General Fund revenue available for the state to spend or save for general purposes when the TABOR limit is exceeded. This dynamic prohibits the legislature from adding new cash fund revenue subject to TABOR. If Proposition NN passes and raises the TABOR limit by $4.6 billion, the state legislature could raise cash fund fees without concern about hitting the TABOR revenue limit. However, General Fund revenue above the old TABOR limit would instead be allocated to the spending distributions required by Proposition NN instead of being refunded to taxpayers.

Appendix

Approved Revenue and Fiscal Policy Ballot Measures since 2005
Year	Measure*	Impact on Revenue/TABOR	Who Pays the Tax	Revenue Impact in FY 2024-25** (in millions)
2005	Referendum C	Allowed the state to keep and spend any revenue above the TABOR limit for 5 years, establishing a new cap with restrictions on how the funds are spent	All tax and fee payers	$3,608.6 [3]
2008	Amendment 50	Expanded casino games and bet limits, increasing gaming tax revenue	Casinos from wagered money	$57.5
2013	Proposition AA (and BB)	Established a tax on marijuana sales legalized by Amendment 64	Marijuana consumers	$232.2
2019	Proposition DD (and JJ)	Legalized and taxed sports betting	Sports betting platforms from wagered money	$36.8
2020	Amendment B	Repealed the Gallagher Amendment	Property owners	-
2020	Proposition 116	Decreased the income tax rate from 4.63% to 4.55%	Any individual or corporation with taxable income	($239.6)
2020	Proposition 117	Required voter approval for the creation of new enterprises that collect over $100 million within the first five years of creation	Enterprise fee payers (payers use the service provided by the enterprise)	-
2020	Proposition 118	Established the paid family and medical leave program (FAMLI) including a payroll tax of 0.88% split between employer and employee	Anyone with taxable income (employees) or who pays wages or salaries (employer)	$1,156.5
2020	Proposition EE (and II)	Increased tobacco taxes and created a new tax on nicotine products	Tobacco and nicotine consumers	$243.6
2022	Proposition 121	Reduced the state income tax from 4.55% to 4.40%	Any individual or corporation with taxable income	($449.2)
2022	Proposition 123	Allocated 0.1% of income tax revenue to a new State Affordable Housing Fund	Existing revenue	($317.0)
2022	Proposition FF (and LL)	Reduced income tax deductions on incomes over $300k to fund free school meals for children	Anyone with taxable income over $300k per year	$132.3
2024	Proposition 130	Allocated existing state revenue ($350M) to law enforcement purposes	Existing revenue	($350.0)
2024	Proposition KK	Levied a 6.5% tax on firearms and ammunition sales	Firearm and firearm ammunition consumers	$3.9 ($15.7 expected first full year)
2025	Proposition MM	Reduced state income tax deductions for income over $300k to fund the Healthy School Meals for All program and food assistance programs.	Anyone with taxable income over $300k per year	$50.7 (FY25-26)
*Amendments amend the state constitution, while propositions change state statute. Letters are used for legislatively referred measures, while numbers indicate a citizen-initiated measure.
**The revenue amounts represent the revenue approved under the measure and collected in the most recent fiscal year unless otherwise noted. If there was no new revenue increase but required the state spend money, it is designated as existing revenue and a decrease in the far-right column. The income tax rate changes reflect the difference in the rates based on FY 2024-25 collections to provide an estimate of the impact in current dollars and under the current state tax policy environment. Sourced from OSPB’s December 2025 forecast document.

The impact to the state and to taxpayers differs depending on the combination of these measures that pass or fail. If conflicting measures pass, they may be interpreted by the courts or the legislature, which could differ from the scenarios below. Any combinations not listed would not impact each other. For reference, here are brief descriptors of each measure:
Proposition NN – Raises the TABOR Limit and Keeps Excess Revenue for Education
Proposition 136 – Limit the Income Tax Rate
Proposition 137 – Sporting Goods Sales Tax Diversion for Conservation
Amendment 87 – Graduated Income Tax
	1. Proposition NN + Proposition 137 Proposition 137 would reduce the revenue subject to TABOR. Because this revenue would no longer count toward the TABOR limit, the state would have to collect roughly $175 million more before reaching the limit, which reduces or eliminates refunds in surplus years and reduces what Proposition NN would retain.[SN1] This would reduce the revenue over the TABOR limit that would be used to fund K-12 public education and other priorities under Proposition NN.
	2. Amendment 87 passes, Proposition 136 fails (or passes with fewer votes) All of the new graduated income tax rates would take effect.
	3. Proposition 136 passes, Amendment 87 fails (or passes with fewer votes) The income tax rate would be capped at 4.4%, at least until voters or the legislature approve a higher or lower rate, respectively, in a future year. If Amendment 87 passes with fewer votes than Proposition 136, the income tax rates below 4.4% proposed in Amendment 87 could take effect, which would lower state revenue collections.
	4. NN + Amendment 87 (+/- Proposition 137) Proposition NN would replace the revenue limit put in place by Referendum C with the new Proposition NN cap and eliminate TABOR refunds for the current forecast period (through FY 2028-29) and possibly beyond. Graduated income tax rates would take effect under Amendment 87, both increasing and decreasing taxes for individuals and corporations, collecting additional state revenue. This amendment would have no impact on TABOR refunds. If Proposition 137 also passes, it would lower revenue subject to TABOR, which will lower the amount of state funds allocated to Proposition NN priorities by $175 million during the first year it takes effect.
	5. NN + Proposition 136 (+/- Proposition 137) Proposition NN would increase the TABOR cap and eliminate TABOR refunds for current forecast period (through FY 2028-29) and possibly beyond. Proposition 136 would cap the income tax rate at 4.4%, but if Amendment 87 does not pass, this has no impact on state revenue. If Proposition 137 also passes, it would lower revenue subject to TABOR, which will require an initial $175 million in additional revenue to hit the TABOR revenue limit and start to fund the priorities passed by Proposition NN.
	6. All four pass (assuming Amendment 87 receives more votes than Proposition 136) Proposition NN would increase the TABOR cap and eliminate TABOR refunds for current forecast period (through FY 2028-29) and possibly beyond. Proposition 137 will require the state to collect additional revenue to hit the prior TABOR limit before the programs under Proposition NN are funded. Graduated income tax rates would take effect under Amendment 87, both increasing and decreasing taxes for individuals and corporations, collecting additional state revenue. If Proposition 136 passes but receives fewer votes than Amendment 87, it will not likely limit the income tax rate.
	7. All four pass (assuming Proposition 136 receives more votes than Amendment 87) The only difference from Scenario 6 would be that the income tax rate would be capped at 4.4%, so any increases in the income tax rates under Amendment 87 would not take effect. If the lower rates under the amendment take effect, total revenue to the state would decline.