Appropriations committee advances House Bill 1419 after heated debate over TABOR refund adjustments

House Bill 1419, a bill to adjust the timing of TABOR refund calculations after retroactive federal tax changes, was approved by the Senate Appropriations Committee on a 4–3 vote after a lengthy hearing that featured legal and fiscal testimony, public opposition and sharp questioning by committee members.

The bill’s sponsor and backers said the measure implements statutory adjustments needed because federal changes enacted in HR1 were applied retroactively and altered the state’s prior refund calculations. ‘‘This commission of updating how refunds are accounted for is intended to follow current law and avoid downstream surprises,’’ sponsor Senator Bridges said during debate.

Opponents centered their criticism on legal and accounting risk. Natalie Menton, a public witness, told the committee she opposed the bill and said legislative staff had recommended against it on accounting and legal grounds. ‘‘We are asking to change the numbers around after they were certified in accordance with TABOR statute and state accounting rules, which resulted in a clean opinion from the office of state auditor,’’ Menton said.

Committee questions focused on whether the bill would retroactively change audited financial statements or simply alter the timing of TABOR refund obligations. Pierce Lively of the Office of Legislative Legal Services said his office could not speak to accounting standards and recommended the committee consult the controller or state auditor for an accounting opinion. Greg Zubetzky, chief economist with Legislative Council Staff, explained that the bill would not change the state’s completed accounting for fiscal year 2024–25 — the ACFR has already been published and audited — but it would change how TABOR refund obligations are recorded for fiscal year 2025–26 and beyond and would impose additional administrative work for the auditor’s office.

‘‘My interpretation is the bill doesn’t change the accounting for that completed fiscal year,’’ Zubetzky said. ‘‘It has the potential consequence of changing the state’s accounting for TABOR for FY25–26. That is why the fiscal note includes administrative costs for the auditor.’’

Senator Kirk Meyer pressed repeatedly for clarity and said he remained concerned about legal exposure and public trust: ‘‘There was no error to correct; our books were closed and we got a clean opinion. What potential legal risk do you think we’re facing with this legislation?’’ Lively declined to give an accounting judgment and reiterated the need for the auditor or controller to weigh in.

After the question-and-answer period and public testimony, the committee adopted amendment L10 (which adjusts timing and adds contingency language) and passed House Bill 1419, as amended, on a roll-call vote of 4–3. Senators Gonzales, the Vice Chair and Chair Amabile voted aye; Senators Kirkmeyer, Liston and Pelton voted no. The committee record shows administrative costs in the fiscal note to cover additional audit and accounting work the bill would require.

What’s next: House Bill 1419 will proceed out of the Appropriations Committee as passed; the legislative record shows remaining questions about audit risk and public transparency that observers may press in later floor consideration.