A metro Denver water provider is asking voters for help, saying TABOR keeps it from seeking grants for projects

A water provider in metro Denver has faced a lose-lose situation: Apply for state funding for water projects and risk giving up tax revenue — or abstain from seeking the millions of dollars of available grant money altogether.

It’s a bad choice voters can help an Adams County water district avoid by passing a ballot measure this fall.

The South Adams County Water and Sanitation District provides water to 70,000 people in Commerce City. The special district has a long list of expensive projects it would like to tackle: a new water treatment plant to remove PFAS chemicals, a fleet conversion to make its vehicles more energy efficient and the replacement of thirsty turf with native plants better adapted to Colorado’s climate.

Local and state grant money is available for all of those projects, but the SACWSD can’t apply for the funds without exceeding its revenue cap set by the state’s Taxpayer’s Bill of Rights. That constitutional measure limits how much revenue government entities can spend. If the water district was awarded grants and hit that limit, it would have to return money to taxpayers — negating the benefit of the grant money in the first place.

“We’ve been reluctant to apply for those funds because of TABOR limits,” district manager Abel Moreno said.

The policy pickle prompted the district to place Ballot Issue 6A on November’s ballot. It asks voters within the district to exempt it from TABOR’s revenue limits.

Voters have exempted the vast majority of Colorado’s local government entities from TABOR restrictions — including Commerce City and Adams County. According to the Bell Policy Institute,  51 of 64 counties in the state, 177 of 178 school districts and 230 of 274 municipalities have done so.

Many local governments seek TABOR exemptions because tax revenue is exceeding the limit and they want to keep the excess tax money for spending. But that’s not the case with the SACWSD, Moreno said.

The district has never exceeded its revenue limit because of taxes, and it has never had to issue refunds. State grant money, however, could push the district over the limit.

“This TABOR exemption is not a means to avoid refunding citizen’s tax dollars,” according to the South Adams Clean Water Alliance, formed to support the ballot question. “Unlike some local governments who are going to the voters with a TABOR exemption ballot question this year, SACWSD is not asking for permission to retain tax revenue it has over-collected. Because it is not running a surplus due to overcollection of tax revenue, taxpayers will not receive a refund if the ballot question fails.”

One of the water district’s top concerns is reducing the amount of PFAS, or “forever chemicals,” in its drinking water supply. The chemicals — perfluoroalkyl and polyfluoroalkyl substances, collectively known as PFAS — have been used for decades to make waterproof, nonstick and stain-resistant products. They are linked to a wide range of health problems, including cancer and reduced fertility.

The chemicals do not break down easily and often make their way into water supplies, including those used by dozens of water providers across Colorado.

The district first detected PFAS in its water supply in 2018 and began work to reduce levels of the chemicals. The district stopped using its most contaminated wells and increased the amount of water it purchased from Denver Water, which the district mixes with its own supply to lower PFAS concentrations. SACWSD also designed a new $80 million water treatment plant, expected to be completed by the end of 2026.