EDITORIAL: Coffman accurately counters Cadman’s contortions about TABOR, hospital fees

Republican leaders are making a purely political decision by using what they’ve discovered to be a mechanism — and nothing close to a mandate — to smack down state Democrats, Obamacare, themselves and all the rest of us in the process

Of course Colorado’s hospital provider fee system can be considered an enterprise fund and exempt from TABOR restrictions, as Republican Attorney General Cynthia Coffman revealed this week to the consternation of state Republican leaders.

And of course Republican leaders are making a purely political decision by using what they’ve discovered to be a mechanism  — and nothing close to a mandate — to smack down state Democrats, Obamacare, themselves and all the rest of us in the process.

Those GOP leaders have long betrothed their political lives and Colorado’s shaky future to the so-called Taxpayers Bill of Rights. It’s a convoluted and highly overrated state constitutional amendment that was sold to voters as a way to stop tax hikes.

It did all that when it was approved in 1992 and so much more. The TABOR amendment not only requires tax hikes to be sanctioned by voters, it also makes a confusing and illogical case for what taxes are. It compresses state spending in a variety of ways. One of those ways is by setting complicated baselines and caps on year-over-year spending. It means that even when state expenses go up along with revenues — a natural occurrence when state population grows along with the need for more services, such as schools, roads and police — under TABOR, the state can’t keep all the revenue it needs. It can’t keep the money even if there was no tax increase. According to TABOR, certain “excess” revenue then must be returned to taxpayers as “refunds.”

In an effort a few years ago to parlay federal money into covering more indigent residents with Medicaid, the state created fees assessed on health care provided by hospitals. The money from the program — fully endorsed by hospitals, doctors and insurance companies — helps offset increased Colorado Medicaid costs. The state enacted the program to prevent mushrooming hospital care provided to the indigent. It means hospitals pass fewer indigent care costs onto its paying customers and provide better health care to poor people for less.

Republican leaders, however, say the fees collected are actually taxes, and must be counted as such. That trips TABOR triggers, meaning the state has to “refund” about $200 million a year, which was never paid as a tax by anyone. It also means the state now bleeds red budget ink at a time when the need for road and schools dollars have never been more critical.

Why? Because GOP leaders are eager to play to their far-right base, which worships this odd anti-tax law. The ploy also allows them to join the national GOP pastime of taking shots at the Affordable Care Act. The problem is, this is beyond partisan political amusement. It’s hurting Colorado residents who want no part of state Republican Senate leadership shenanigans.

The fee-vs-tax argument is led by GOP state Senate President Bill Cadman. He and fellow proponents are willing to leverage their one-vote Senate majority against the will of the state House, the governor and others to use the money as transparently intended for increased Medicaid spending to help pay for it, shortchanging roads and schools.

They base their argument on a memo questioning whether the fee might be a tax under TABOR. Of course it’s not. Of course it’s an enterprise fee. Enterprises are government programs that collect fees for a sole purpose. In Aurora, the golf department is an enterprise fund. So, too, is the water department. Fees collected for those purposes can only be spent on those programs, which they are. In Colorado, fees assessed hospitals for patient care can only be spent on Medicaid reimbursement to the state, which they are. Plenty of politicians and lawyers agree with that interpretation, including the state’s top lawyer, Cynthia Coffman.

Our guess is that there are many Republicans who disagree with Cadman’s political scheme, since it has nothing to do with tax hikes. In GOP strongholds, Cadman’s tactic allows those lawmakers up for re-election or trying to win seats the ability to play to the far-right base. But in swing districts, it gives Democrats the chance to persuade reasonable voters how utterly unreasonable these antics by Cadman and others really are.

No one wins by staying the hard-line course here, most of all residents cheated out of road and school improvements because of this plot. Cadman should let the money be spent how it was legally intended. Save the political ruse for a winning argument.

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