Dems' car tax, fee hikes kick in amid public outrage; GOP warns, 'Backlash has just begun'

Republicans say an outcry this week among angry Colorado motorists--blindsided by the Ritter administration's steep spike in auto-registration fees--is just the first blast of mounting discontent at some $1 billion in tax and fee hikes pushed through the legislature by the governor and ruling Democrats despite a crippling recession.

"No one should be surprised at the reaction," Senate GOP leader Josh Penry said today following news reports of public fury at the dramatic hike in auto-registration fees that took effect Wednesday.

"You don't raise taxes and fees when the entire economy is in a tailspin," said Penry, of Grand Junction. "Just ask any Coloradan who got slapped with a fat increase on his old pickup at the very same time he is facing a pay cut or maybe even a layoff at work and can barely make ends meet at home."

Added Penry, "This is just the tip of the iceberg when you look at the range of back-door tax hikes and front-door fee hikes imposed by the party in power. In all likelihood, the public backlash has just begun."

At issue is Senate Bill 108, enacted this year by Democrats and signed into law by Ritter against unanimous Republican opposition. The measure, which became law with the start of the new fiscal year July 1, raises fees on motorists by some $250 million a year and opens the door to expanded tolling. The cost of registering the typical passenger car is rising $30 to $40, and some commercial trucks' fees will go up by more than $700.

Republicans heatedly fought the measure when it was introduced and debated in the General Assembly earlier this year, and even a handful of Democrats in both legislative chambers crossed the aisle to vote in opposition.

The bill was one of multiple tax and fee hikes--totaling more than $1 billion--pushed through the legislature and signed into law by Ritter this year.

"The party that runs the State Capitol right now couldn't be more out of touch with the average taxpayer," said Assistant Senate Republican chief Greg Brophy, a farmer from Wray on the eastern plains. "They don't seem to have a clue as to how big a blow this is to people facing these tough economic times. If this governor succeeds in bringing Coloradans together, it'll be in the form of an uprising against his own tax-and-fee hikes."

The massive new tab handed to taxpyers by the Ritter administration includes:

• A $250 million-a-year hike in vehicle-registration fees--ostensibly to fund transportation--with the price of registering the typical family car going up $30 to $40.
• A $600 million-a-year fee imposed on the state's hospitals in an attempt to leverage more federal Medicaid funding for the poor; Republicans said the ripple effects are sure to trickle down through higher health-plan premiums for everyone else.
• A $90 million jump in property taxes for seniors, who will lose their homestead exemption.
• An increase in the amount of sales-tax revenue retailers will have to forward to the state, costing small businesses and other stores another $31 million a year.
• A hike in the tax on capital gains on some Colorado investments, costing businesses and investors $7 million the first year and $16 million the next.
• Democats also voted to remove the sales-tax exemption on already-heavily taxed cigarettes--claiming another $30 million.

"The Democrats seem to forget that raising fees by a nickel here and a dime there really adds up in the end," said Senate Republican Whip Nancy Spence, a veteran lawmaker from Centennial. "The net effect is to create a real hardship for the average Coloradan. At some point you have to wonder if the ruling party and the governor have forgotten that we're in the middle of a devastating recession."