The Colorado Car Tax – er, “vehicle registration fee” increase – brought to you courtesy of the Colorado Supreme Court

Clear The Bench Colorado has alerted Colorado citizens over the last several months to the Colorado General Assembly’s underhanded tactic (Colorado Politics at its worst) of circumventing the TABOR requirement to receive voter approval before imposing or increasing taxes by playing the word game of calling the charges “fees” instead – thanks to a ruling by the Colorado Supreme Court last November:

Governor Ritter, the Colorado Legislature, and the Mullarkey Majority seem to find the requirement to first ask before raising taxes (as required by TABOR) to be rather tiring – and restricting their power to accomplish their goals with your money.  What to do, what to do?  Simple – creatively define their way out of the restrictions; impose fees, instead of raising taxes – no need to ask the voters first; then just transfer the collected revenue (the ol’ shell game) into the general fund, so as to avoid those pesky restrictions on spending the money…

The most universally despised use of this tactic – and the one affecting the greatest number of Colorado citizens – was last year’s Colorado Car Tax increase, the so-called FASTER bill (SB 108).

It’s even worse than you think – as I discovered by researching the impacts in greater detail for the following article, published in the “Taxed Enough Already” April edition of The Constitutionalist Today monthly newspaper (add it to your “recommended reading” list).

The Colorado Car Tax – It’s Worse Than You Think

The Colorado Car Tax increase passed last year (SB108, the so-called “FASTER” bill) is quite possibly THE most unpopular tax increase in Colorado history – made all the more repugnant by how it became law (evading the TABOR requirement to receive prior voter approval for any new or increased taxes).

The deeply unpopular Car Tax has already contributed to the demise of the political careers of the bill’s main advocates: Governor Bill Ritter, who signed the bill into law, has chosen not to seek re-election rather than suffer the fate of governors in other states, including New Jersey, Virginia, and Arkansas (yes, Bill Clinton suffered his first big electoral defeat after passing a car tax increase his first term) who passed similar tax increases on vehicle registration and ownership.  State Senator Dan Gibbs (D-SD16), the bill’s Senate sponsor, has likewise decided not to seek re-election.  Only House sponsor Rep. Joe Rice (D-HD38) remains, and he is facing a tough re-election fight in his Republican-leaning district (Littleton) against challenger Kathleen Conti , who is sure to use the car tax issue against him during the campaign.

The Car Tax has also highlighted the role of the Colorado Supreme Court’ “Mullarkey Majority” in aiding and abetting increases in taxes and other “fees” thanks to several rulings against the clear letter of the Colorado Constitution (particularly Article X, Section 20 – the Taxpayer’s Bill of Rights) in recent years.  The political careers of four of the state Supreme Court justices who ruled to enable this tax increase (among others, including the “Mill Levy Tax Freeze” property tax increase) may also be coming to an end, as they come up for re-election (phrased as a question on the ballot: “Should Justice [name] be retained in office?” with the option to vote yes or “NO”) this November.

So why is the Car Tax (er, “vehicle registration fee”) increase so deeply (and deservedly) unpopular?

One reason is the deeply regressive nature of the tax (er, “fee”) increase – which hurts most those least able to afford it (especially those with lower or fixed incomes, such as blue-collar workers, students, and retired or unemployed individuals).  Since newly increased tax (er, package of “fees” – which will go up not just once, but each year through 2012) is now based on vehicle weight, the increase may not seem like much to the latte-sipping Prius-driving set, but makes up a significant portion of the total vehicle registration bill for anyone driving an older, heavier (and incidentally, safer) vehicle.

SB09-108 Registration fee increase total

Vehicles/Trailer FY09-10 FY10-11 FY11-12+
2,000 lbs. & under $22.50 $25.75 $29
2,001-5,000 lbs. $32 $36.50 $41
5,001-10,000 lbs. $39.50 $45.25 $51
10,001-16,000 lbs $51.50 $58.75 $66
16,001 lbs & over $55 $63 $71

Actually, it’s even worse than you think.  The FASTER bill (the Colorado Car Tax) actually consists of TWO new “fees”: a “road safety” surcharge fee, and a “Bridge Fund” fee (that will increase in each of the next two years).  The new law also imposes a new “vehicle rental fee” of $2/day – with an exemption for politically-correct “vehicle sharing” arrangements, such as instituted in Boulder and other trendy spots.  The two new “fees” – and the additional bureaucracy created for each – have been ignored in most of the reporting about the impact of the Car Tax increase on most citizens.

“Road Safety” Surcharge Fee

(incl. trailers & other “nonmotorized” vehicles)

“Bridge Fund” Fee Rate Schedule

(50% 1st year; 75% 2nd year; 100% 3rd year +)

$16     Vehicles <=2000 lbs (incl. motorcycles) $13     Vehicles <=2000 lbs (incl. motorcycles)
$23     Vehicles 2000 – 5000 lbs $18     Vehicles 2000 – 5000 lbs
$28     Vehicles 5000 – 10000 lbs $23     Vehicles 5000 – 10000 lbs
$37     Vehicles 10000 – 16000 lbs $29     Vehicles 10000 – 16000 lbs
$39     Vehicles 16000+ lbs $32     Vehicles 16000+ lbs

And of course there are the “Late Fees” -

“A late registration penalty of $25 for each month or portion of a month that a vehicle is not registered after the one month grace period, not to exceed $100, will be charged beginning June 1, 2009. Expired temporary permit registrations are also included in the $25 penalty. There is no grace period for permits.”

Late fees are now mandatory – the bill removed existing language allowing clerks to exercise discretion:

The department or the authorized agent registering the vehicle may waive the late fee.

Adding insult to injury, the Car Tax bill also creates entirely new bureaucracies, complete with new staff:  the “Bridge Enterprise” and the “Transportation Enterprise” – both of which “operate as a government-owned business” within the Department of Transportation.  These “government-owned businesses” not only have “exclusive authority to budget and approve the expenditure of moneys” collected by the Car Tax (er, “fees”), but also have the authority to issue/re-issue bonds and contract for loans or grants.  The “enterprises” were also added as entities authorized to use eminent domain to seize private property.

Yet despite all of these revenue-generating and spending powers, the bill’s language explicitly states that both “enterprises” – “shall not be subject to any provisions of Section 20 of Article X of the state Constitution” (i.e. TABOR, the Taxpayer’s Bill of Rights).  They are not constrained, or accountable.

But all of this is necessary “to preserve our crumbling transportation infrastructure,” right?  That was the justification for passing the bill – along with claims that any and all “fees” collected “shall be used exclusively for the construction, maintenance, and supervision of the public highways of the state.”   Says so right in the legislative language (43-4-810), so it must be true, correct?

Not so much.  The dirty little secret of the FASTER bill is that many of the taxes (er, “fees”) collected don’t go towards the construction or maintenance of roads or bridges at all, but for “multi-modal and demand-side transportation solutions” – such as the desire of certain state Senators for streetcars in Denver – justified by other language in a following section (43-4-812):

43-4-812. Use of user fees for transit – legislative declaration.

(2) THE GENERAL ASSEMBLY HEREBY FINDS AND DECLARES THAT THE FUNDING OF TRANSIT-RELATED PROJECTS AUTHORIZED BY SUBSECTION (1) OF THIS SECTION CONSTITUTES MAINTENANCE AND SUPERVISION OF STATE HIGHWAYS BECAUSE IT WILL HELP TO REDUCE TRAFFIC ON STATE HIGHWAYS AND THEREBY REDUCE WEAR AND TEAR ON STATE HIGHWAYS AND BRIDGES AND INCREASE THEIR RELIABILITY, SAFETY, AND EXPECTED USEFUL LIFE.

In fact, the bill MANDATES state spending of $10 Million per year on “transit-related projects.”

It’s an outrageous semantic shell game – and a blatant violation of your constitutional rights.

To sum up: the “FASTER” car tax increase raised vehicle registration fees by $22.50-55 per vehicle, including a “road safety surcharge fee” of $16-$39 per vehicle, PLUS a “bridge fund fee” of $13-$32 per vehicle (halved the first year – so it’s $6.50-$16 this year) in the FIRST YEAR ALONE (with two more years of tax – er, “fee” – increases to come).  Plus mandatory “late fees” of $25/month (capped at $100) – for all “vehicles” (including trailers barely even worth that much).

All while creating two new state bureaucracies with power to spend, borrow, & seize private property unconstrained by the Taxpayer’s Bill of Rights and not accountable to the people.

Oh, and increasing mandatory spending by over $10 Million per year on purposes other than roads, bridges, or other transportation infrastructure used by those paying the “fees.”

If anything, the angry crowds at Motor Vehicle offices last summer may have been a MILD reaction, although the anger was misdirected at the hapless county clerks.

Some of the politicians who did this to you – including Governor Ritter and Senate sponsor Dan Gibbs – have quit, rather than face the voters.  House sponsor Joe Rice remains, but is facing a tough challenge from Kathleen Conti in his GOP-leaning district.  But most importantly, you CAN vote against the four Colorado Supreme Court justices (Mullarkey, Bender, Martinez, and Rice) who enabled this type of sham legislation in the first place with their Nov. 2008 ruling to allow “fees” to act like taxes, in violation of your constitutional rights to have any say in the matter.  Clear The Bench, Colorado!

Fight back against this assault on your rights – and your wallet. Exercise your right to vote “NO” this November on the four ‘unjust justices’ of the Colorado Supreme Court’s “Mullarkey Majority”- (Justices Michael Bender, Alex Martinez, Nancy Rice, & Chief Justice Mary Mullarkey) who need YOUR approval to continue taking away your constitutional rights: your right to vote on tax increases, your right to defend your home and business from seizure by governments abusing eminent domain, and your right to enjoy the benefits of the rule of law, instead of suffering under rule by activist, agenda-driven “justices.”  Support Clear The Bench Colorado with your comments (Sound Off!), your contributions, and “NO” vote on retaining these unjust justices on the bench for another 10 years!

24 Responses to The Colorado Car Tax – er, “vehicle registration fee” increase – brought to you courtesy of the Colorado Supreme Court

  • Bob says:

    What a great legal precedent for case law! This establishes that constitutional limitations on the powers of government are optional at the discretion of the legislature and judiciary. Persons who choose to publicly oppose this law may be jailed for their anti-government rhetoric. Welcome to Havana.

  • Walter Stout says:

    The foregoing tax data is right on and accurate. We have checked these numbers and there is no hyperbole here.

    The folks responsible for this “sham” will be dealt with and booted out of office and off the bench. The voter will win, sometimes it just takes us a little more time.

    whs

  • j says:

    I hate our representatives. I have a a 30 year old car. Registration was 25$, now after this tax it is freakin $65. WTH!!!! Urg It makes me so mad!! I hate politicians that sneak laws through under pretense of “Fee” and not “Tax”. Get these damn corrupt politicians out of office!!!

  • Paul Guzman says:

    I’d like to know why my cost to register a 2010 Prius is now listed as $77.97 for a License FEE and $344.30 Ownership TAX for a total of $422.27?

    Who determines what the Ownership TAX is for a particular vehicle?

    It is no wonder the general public hold on to “Clunkers” that pollute the air.

  • Lee says:

    I just spent $430 to plate my motorcycle. 300 of that was due to fees + ownership taxes. This is outrageous. I may as well walk downtown Denver with my wallet open while these crooks walk by and just steal the rest of my hard earned money.

  • Jeff says:

    I just watched a series of videos, (Constitution Class taught by Michael Badnarik)
    He has some really good points based on the Constitution like why do we need to continue to pay taxes on vehicles once they are paid off.
    I highly recommend you take the time to watch these and see just how bad our elected officials have gotten because not enough of us know our rights.
    (I wonder if our government run schools have a little something to do with that)

    All that is necessary for the triumph of evil is that good men do nothing.” (Edmund Burke)

  • John says:

    People who organized to fight this car tax with Amendment 101 better be screaming voter fraud from the tops of the Rockies.

    Right now with 25% of the votes in, 101 is losing by a whopping 40%! Even with a lot stupid people out there, this still defies ANY logic.

    The car tax had every media outlet’s facebook page overloaded with outraged people. The media was hard pressed to find a ‘man on the street’ who wasn’t POed about it and, the election office is trying to tell me an over whelming majority is NOT in favor of repealing it?

    Sorry this stinks to high heaven of voter fraud, and with mail in voting and voting ‘fax’ machines, voter fraud in Colorado is easy as Sunday morning.

  • Ralph says:

    No one likes to pay taxes, or fees, however, if you want to drive on decent roads and reduce traffic congestion you need to pay for it. The “ownership tax” in Colorado, though described as a car tax, is, in fact, a personal property tax. It is a way for counties to raise money to support services for its residents. Many states tax the value of your licensed vehicles/trailers/boats and call it a “personal property tax”.

  • Tom says:

    I am more irritated at the $25 per month late fee. Why are you penalized if you do not want to register a car but later decide to for whatever reason to do so? Maybe you have a second or third junk car sitting in the garage and weren’t sure you wanted to even fix it but then decided to 6 months later? Now instead of paying 70 bucks for an entire year they hit you for 170. Turns out it is cheaper to gift the old car to a family member and get new plates. Sad but true.

  • BDJ says:

    My 2004 Ford F150 is being taxed based on its 2004 MSRP, which exceeds by $3000 what I paid for it, and by $13000 what the current blue book value is.

    This is why I despise all politicians with the burning white hot intensity of a thousand suns.

  • Melvin H. says:

    Something I have wondered:
    (1) If you pay taxes/fees on one car, then sell/trade it in on a new car (paying the higher taxes/fees on it)….why shouldn’t you get a refund on the taxes/fees paid on the previous car, or be able to get the (pro-rated) fees you ALREADY paid on a car you no longer have applied to the taxes/fees on the car you just purchased???
    [or refunded outright if you do not purchase a new car]

    (2) If you lease a vehicle, why can’t you have the taxes folded into the contract for the lease, so you don’t get hit all at once on a car that (as I understand it) you technically don’t own? In other words, have the taxes on a car (divided by 12 payments) able to be added to the monthly lease payment?

    (3) On a completely different subject: Given that auto insurance is mandatory, why is it that an insurance company is allowed to turn you down on the basis of . . . your credit report??? Your driving record, sure; but using your credit report as a basis for auto insurance would be like using your driving record as a basis for getting homeowners’ insurance.

  • K says:

    I have kept my license and tags out of state for this exact reason for the past 10 years. I just registered my new truck for the first time for $865.00 (ownership tax and reg), that is a joke. I will be registering my truck out of state again once it is time to renew. I have no problem contributing to the state I live in, but Colorado will no longer receive any more of my money.

  • CL Jones says:

    Paying this horrifing taxes appears to be signs of intentional corruption. On the otherhand other items are overpriced such as water an essential need to survive. I have lived in many states in the U.S.A. and found the most expensive for water was California (1967) when we had to pay for bottled water due to the poor quality of water for consumption.

    The problem with taxes on automobiles in America is due to the fact that in Colorado you are taxed on MSRP rather than actual value. If the bill were appealed and modified to tax on actual value rather than inflated values vehicles could not be taxed for tags on values exceeding 50% for owner ship tax. This simply because the value is devalued by 50% the day it exits the dealership.

    Secondly if people would wake up and smell the coffee, they could approve increased property tax values (tax deductible) and reduce vehicle tax (not tax deductible) and leave toy’s taxable as luxary items. This was provide a more broadbased fair tax for the citizens of Colorado.

    Charge a visitor or tourist tax for those who enter the state such as toll booths at port of entry like New England States have to pay for highways, and education. This allows for lower property and personal tax mandates, that grossly affect millions of low income workers and spans statewide to all citizens regardless of income.

    Gambling tax for education rather than supporting millions of acres of land that does nothing more than support natural wildlife allowing gaming taxes to be devided 60% for education 10% wildlife 20% Colorado Citizen Retirement Fund ( does not exist) similar to that which Alaska distributes major income from production to its citizens) and 10% to Economic Growth and Development Planning distributed among counties in the state of Colorado.

    There are ways to make life more affordable, maintain the beauty of Colorado and not impose longterm hardships on its citizens. The Colorado Constitution clearly states the people reserve the right to abolish or ammend the constitution at anytime.

    Perhaps if the people would join forces positive changes can and will occur. End corruption in government and restore integrigty and affordability to Colorado’s citizens.

    CL Jones
    New Visions of America Foundation
    Colorado

  • Sam says:

    I have a pre 1990 pu and now the taxes are way over a hundred dollars. Let us start a very vibrant campaign to RECALL the Governor Hickenlooper. Take back our state by taking charge. Maybe boycot his beer company. Maybe P&M to every Colorado State congressional person and let them know they are on their way out next election.

  • Cl Jones says:

    It is time for ciitzens to step up and take action. Vote to abolish “ownership” tax on motor vehicles and have a flat rate for all citizens. This would be fair and equitable. I relocted here from Texas and each vehicle pays an average of $60 annually for renewal. They do not charge “Ownership Tax” nor do the charge “State Income Tax” and yes they do charge higher realestate tax but allow greater exemptions for those who are disabled, veterans, or seniors.

    Colorado is one of the worst states for taxing consumers I have encountered. They surpass California you for years had the worst reputation. Secondly they do not justify charging these alleged ownership taxes when they fail to produce jobs for its citizens.

    Vote to abolish Owner Ship Tax on motor vehicles.

    Enough is Enough

  • Gary says:

    I just retired and had to renew my plates I about had a heart atack when I seen they had raised the cost another ten dollars. My truck is a 1998 dodge 3/4 ton diesel. This truck is 15 years old and the plates just keep getting higher and higher so the colorado government can waste this money in Denver and all the other towns that pay into this never see the benifit. Its time for the people to revolt and refuse to renew there plates until colorado gets the fees down to reasonalble rate. is there a salution to this madness?

  • John says:

    I am so glad to have found this site! I just leased a new vehicle in Colorado and registration cost me $545.00. I was appalled!
    I’m not sure I fully understand what has changed in the past few years. I understand that the vehicle registration has been historically high in Colorado but definitely is geared towards penalizing new purchases on an almost exponential scale.
    We pay a ton of taxes, “fees” and otherwise yet our school budgets are shrinking each year.
    I recently learned that the Lottery Proceeds do not go towards education, which was shocking to me. I think most other states intended use of lottery funds is geared towards education, whether they maintain that use efficiently or not. However, in Colorado, it is geared towards “open space projects”. Don’t mistake me for some anti-green type but I think the priority should be education, not parks. Besides, Colorado was beautiful before we got here. Why should it cost so much to maintain that beauty? Any chance to challenge the distribution of lottery proceeds in this state any time soon? I could get behind an initiative like that.

    Again, thanks and I’ll be checking this site out more often.

  • P. Perales says:

    This really is amazing, You’re a pretty experienced blogger.
    Also, We’ve embraced your internet site in my social networks.

  • J. Nordstrom says:

    Wow, the vehicle registration fees here in Denver are ridiculous. Way to punish the average working folks. I was thinking of upgrading my new car in a couple of years but now I guess I’ll drive the one I have until it dies so maybe someday it won’t cost me hundreds of dollars to register it. I have a $24,000 Subaru not a Lamborghini, sheesh.

  • Michael Pekish says:

    It appears the politicians of Colorado need to be removed from office over this and the Boulder turnpike contract. Do we continue to allow them to do what they want with taxpayer money?

  • Eric says:

    I did not know about this before I read your article. You explained it really well. Thanks for sharing this information here.

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