Colorado’s enterprise-fee end-run around TABOR

DENVER — Colorado’s Taxpayer’s Bill of Rights is still in the state constitution, but most of what the state spends each year never touches it. Laramie Energy chairman and CEO Bob Boswell told Kim Monson on the April 13 broadcast of the Kim Monson Show that the legislature has routed around TABOR by labeling billions of dollars in revenue as enterprise fees instead of taxes, and that a coalition of businesses and labor is preparing litigation to reverse the practice. The primary-source numbers Boswell cited are already out of date, and the trendline is steeper than he said.

“There’s been implementation of what’s known as enterprise fees, and this is a way to get around the Tabor Act,” Boswell said on the program. “These are, in fact, taxes, not fees, but they have put some 20, almost 30, I think, enterprise fees in to fund out-of-government spending in the state of Colorado. The budget’s now $41 billion. $23 billion of the revenues to fund the government come from these enterprise fees, which have been put in place to circumvent the purpose of the Tabor Act.”

Boswell’s figures are from last year. The Common Sense Institute’s December 2025 budget release puts Colorado’s FY26 total state appropriations at $44 billion, and the Colorado Joint Budget Committee’s FY25-26 Appropriations Report places total operating appropriations at $46.7 billion. CSI’s most recent Snapshot of Fees in Colorado, covering fiscal 2024, reports that fee-based enterprises collected $25.8 billion, up from $742 million in TABOR’s first year of effect. That is a 3,400 percent increase against 196 percent for population growth plus inflation over the same period.

The more telling number is the share of state spending that sits outside TABOR’s revenue cap entirely. In 1996, CSI found, 46 percent of state spending was TABOR-exempt. By FY24, 74 percent was. Put differently, three dollars of every four the state spends are now beyond the reach of the voter-approval and refund mechanics Colorado voters wrote into the constitution in 1992.

How the enterprise carve-out works

TABOR, at Article X Section 20 of the Colorado Constitution, defines an enterprise as “a government-owned business authorized to issue its own revenue bonds and receiving under 10% of annual revenue in grants from all Colorado state and local governments combined.” Revenue collected by an enterprise is not counted as “district revenue” and does not trigger TABOR’s revenue cap or its refund requirement. Voters tried to close the door in 2020 with Proposition 117, which required voter approval for any new enterprise projected to collect more than $100 million in its first five years. According to CSI, the legislature has since stood up 10 new enterprises and expanded one more, each falling below the $100 million trigger. Kelly Caulfield, CSI’s executive director, told the Denver Gazette that “the legislature circumvented voter intent by continuing to authorize enterprise funds that fall just below that cap.”

The lawsuit that does not yet exist

Boswell said the response is a coalition legal strategy. “There is a group, a coalition of businesses and labor that has some nine different issues,” he told Monson. “… And there’ll be a lawsuit to say that these are taxes. They are not enterprise fees, and they need to come under the banner of the Tabor Act.” No such lawsuit has been filed at this time. The closest active campaign is the ballot-initiative push led by Michael Fields of the conservative Advance Colorado Institute and former Arapahoe County GOP chair Suzanne Taheri, who filed nearly two dozen tax-and-fee-related measures for the 2026 ballot. On March 9 the Colorado Supreme Court, in a unanimous opinion by Chief Justice Monica M. Márquez, blocked Initiative #158 on single-subject grounds; other revenue-related measures from the same proponents have received Title Board approval but none has qualified for the ballot.

Any coalition lawsuit also runs into recent precedent. In 2019 the Colorado Supreme Court declined in NFIB v. Colorado Department of State to rule on whether business-filing fees were unconstitutional taxes, calling the increases “incidental and de minimis.” In June 2021 the court denied certiorari in the TABOR Foundation’s six-year challenge to the hospital provider fee, after the Court of Appeals found the plaintiffs lacked standing and that the fee was not subject to TABOR on the merits. Between those two rulings and the Initiative #158 decision, the Colorado Supreme Court has turned away every recent attempt to reach the fee-versus-tax question.

The 2026 legislative version of the same question

Senate Bill 26-135, sponsored by Senate Democrats Jeff Bridges of Greenwood Village and Cathy Kipp of Fort Collins, would refer a November 2026 ballot question asking voters to let the state keep revenue above the TABOR cap, in an amount equal to state K-12 funding, and to raise K-12 funding by up to 2 percent a year for ten years. Senate Finance advanced the bill on a 6-3 party-line vote on March 12. Monson, who serves as president of the Colorado Union of Taxpayers, has called SB26-135 “an all-out assault upon TABOR” and says CUT has taken a position against the bill. The fiscal analysis projects the state would keep roughly $817 million in the first year alone.