Second Regular Session Seventieth General Assembly STATE OF COLORADO INTRODUCED LLS NO. R16-0712.01 Bob Lackner x4350 SCR16-004 SENATE SPONSORSHIP Ulibarri, HOUSE SPONSORSHIP (None), Senate Committees House Committees State, Veterans, & Military Affairs SENATE CONCURRENT RESOLUTION 16-004 Submitting to the registered electors of the state of Colorado an amendment to the Colorado constitution concerning the imposition of a real estate transfer tax of one-tenth of one percent of the value of real property transferred in the state that will be used to finance affordable housing, and, in connection therewith, allowing the revenues from the tax to be collected and spent notwithstanding any limitation provided by law. Resolution Summary (Note: This summary applies to this resolution as introduced and does not reflect any amendments that may be subsequently adopted. If this resolution passes third reading in the house of introduction, a resolution summary that applies to the reengrossed version of this resolution will be available at http://www.leg.state.co.us/billsummaries.) The concurrent resolution deletes the prohibition in the state constitution on new or increased transfer tax rates on real property. The resolution imposes a tax upon the recording of each real property deed at the rate of 1/10 of 1% of the value of the real property as specified in the deed for the privilege of transferring the title to real property. A conveyance from one spouse or other marital partner to another or a correction deed are exempt from payment of the tax. At the time any deed evidencing a transfer of title subject to the tax imposed is offered for recording, the county clerk and recorder is required to ascertain and compute the amount of the tax due and to collect the same from the purchaser of the real property as a prerequisite to acceptance of the deed for recording. The amount of tax is computed on the basis of the value of the transferred property as specified in the deed. The county clerk and recorder is required to collect the amount due under the tax and certify the date of payment and the amount collected on the deed. The county clerk and recorder is authorized to retain 5% of the amount collected as his or her fee for collection and to further remit the balance on a quarterly basis to the county treasurer. The county treasurer is then required to transmit the same to the state treasurer for the deposit of such moneys into the state affordable housing trust fund (fund). The fund is created in the Colorado housing and finance authority (authority). The concurrent resolution requires that moneys in the fund be used to support new or existing programs that expand the provision of affordable housing. The programs are to be administered by the authority. The resolution contains additional requirements governing the use of moneys in the fund. The resolution specifies that its approval by the registered electors of the state voting on the ballot issue at the general election held in November 2016 constitutes a voter-approved revenue change to allow the retention and expenditure of state revenues in excess of the limitation on state fiscal year spending. The general assembly may modify any of the provisions as necessary in order to facilitate a more effective administration of the provisions. However, such legislation shall not limit or restrict the imposition of the tax or the use of the moneys raised by the tax for affordable housing. Be It Resolved by the Senate of the Seventieth General Assembly of the State of Colorado, the House of Representatives concurring herein: SECTION 1. At the election held on November 8, 2016, the secretary of state shall submit to the registered electors of the state of Colorado, for their approval or rejection, the following amendment to the to the state constitution: In the constitution of the state of Colorado, section 20 of article X, amend (8) (a) as follows: Section 20. The Taxpayer's Bill of Rights. (8) Revenue limits. (a) New or increased transfer tax rates on real property are prohibited. No new state real property tax or local district income tax shall be imposed. Neither an income tax rate increase nor a new state definition of taxable income shall apply before the next tax year. Any income tax law change after July 1, 1992 shall also require all taxable net income to be taxed at one rate, excluding refund tax credits or voter-approved tax credits, with no added tax or surcharge. In the constitution of the state of Colorado, article X, add section 22 as follows: Section 22. Real estate transfer tax to fund affordable housing - state affordable housing trust fund - definitions. (1) As used in this section, unless the article otherwise requires: (a) "Affordable housing" means housing that is affordable to a household that makes sixty percent or less of the area median income. The criteria for determining "affordable housing" may be modified by the general assembly in accordance with subsection (9) of this section. (b) "Authority" means the Colorado housing and finance authority or any successor entity. (c) "Cost-burdened household" means a household with an annual income of sixty percent or less of the area median income. The criteria for determining "cost-burdened household" may be modified by the general assembly in accordance with subsection (9) of this section. (d) "Deed" means any document, instrument, or writing other than a will, lease, or easement, regardless of where made, executed, or delivered, by which any real property in Colorado, or any interest in such property, is conveyed, vested, granted, bargained, sold, transferred, or assigned. (e) "Fund" means the state affordable housing trust fund created in the authority in accordance with subsection (5) of this section. (f) "Value" means the amount of the full actual consideration paid or to be paid for the real property, including the amount of any liens on the property created or imposed as a result of the conveyance. (2) (a) On and after January 1, 2018, except as otherwise provided in this section, a tax is hereby imposed upon the recording of each deed in accordance with the requirements of this section at the rate of one-tenth of one percent of the value of the real property as specified in the deed for the privilege of transferring the title to the real property. The tax imposed must be computed to the nearest whole dollar. (b) The tax imposed by paragraph (a) of this subsection (2) shall not be imposed on a conveyance from one spouse or other marital partner to another or in the case of a correction deed. (c) The recording of a deed subjects the transfer evidenced by such deed to the tax imposed by paragraph (a) of this subsection (2) unless the transfer is specifically exempt from such tax as provided by law. (3) (a) At the time any deed evidencing a transfer of title subject to the tax imposed under subsection (2) of this section is offered for recording, the county clerk and recorder shall ascertain and compute the amount of the tax due and shall collect the same from the purchaser of the real property as a prerequisite to acceptance of the deed for recording. (b) The amount of tax is computed on the basis of the value of the transferred property as specified in the deed. (c) The tax required to be levied under subsection (2) of this section must be collected only once on each transaction and in the county in which the real property is located. (4) The county clerk and recorder shall collect the amount due and certify the date of payment and the amount collected on the deed. The county clerk and recorder shall retain five percent of the amount collected as his or her fee for collection and shall further remit the balance on a quarterly basis to the county treasurer. The county treasurer shall transmit the same to the state treasurer who shall deposit said moneys into the state affordable housing trust fund. (5) (a) There is hereby created in the authority the state affordable housing trust fund. The authority shall deposit into the fund: (I) Any moneys collected by the county clerk and recorders from the imposition of the real estate transfer tax levied under subsection (2) of this section are to be transmitted by the county clerk and recorders to the county treasurers and thereafter to the state treasurer in accordance with subsection (4) of this section; (II) Any moneys made available by the state for the purposes of the fund; and (III) Any moneys that are made available by or to the authority from any other sources for the purpose of the fund. (b) All moneys in the fund must be expended for the purpose of supporting new or existing programs that support: (I) The construction, maintenance, rehabilitation, or repair of affordable housing statewide for rental purposes or home ownership across the state; and (II) The provision of financial assistance, including without limitation grants or loans, to natural persons, nonprofit entities, and political subdivisions across the state to enable persons in cost-burdened households to finance the purchase, refinance, rehabilitation, or repair of affordable housing. (6) The new or existing programs supported by the fund are to be administered by the authority. The authority has sole administrative discretion to determine how best to expend the portion of moneys deposited into the fund. (7) (a) Any moneys in the fund not expended at the end of any fiscal year must remain in the fund and will not be transferred to or revert to the general fund at the end of any such fiscal year. Any interest earned on the investment or deposit of moneys in the fund must remain in the fund and shall not be credited to the general fund. (b) Moneys held in the fund shall not be transferred to any of the other funds created by law in the authority. (c) The authority may make moneys in other funds that it administers available to the fund. (8) The approval of this section by the registered electors of the state voting on the ballot issue at the general election held in November 2016 constitutes a voter-approved revenue change to allow the retention and expenditure of state revenues in excess of the limitation on state fiscal year spending. (9) The general assembly may, by duly enacted legislation, modify any of the provisions of this section as circumstances warrant, and particularly as necessary to facilitate the more effective administration of this section; except that any such legislation shall not limit or restrict the imposition of the tax specified in subsection (2) of this section or the use of the moneys raised by the tax for affordable housing in accordance with this section. SECTION 2. Each elector voting at the election may cast a vote either "Yes/For" or "No/Against" on the following ballot title: "Shall state taxes be increased by $_____ annually in the first full fiscal year and by such amounts as are raised thereafter by an amendment to the Colorado constitution concerning the imposition of a real estate transfer tax of one-tenth of one percent of the value of real property transferred in the state that will be used to finance affordable housing, and, in connection therewith, allowing the revenues from the tax to be collected and spent notwithstanding any limitation provided by law?" SECTION 3. Except as otherwise provided in section 1-40-123, Colorado Revised Statutes, if a majority of the electors voting on the ballot title vote "Yes/For", then the amendment will become part of the state constitution.