Voters cede tax refunds

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DENVER -- Colorado residents voted Tuesday to allow the state to keep an estimated $3.7 million over five years that otherwise would have been refunded to taxpayers.

Meanwhile, Denver voters agreed to decriminalize the possession of small amounts of marijuana within city limits.

Coloradans voted 52 percent to 48 percent in favor of Referendum C, which suspends the state's Taxpayer's Bill of Rights (TABOR) for five years.

"This will not mean the death of TABOR across the board, but it's a setback," said Pete Sepp, spokesman for the National Taxpayers Union, which has promoted Colorado's TABOR as a model for other states. "Obviously, opponents of these measures in other states will use this as ammunition."

Californians will vote Tuesday on a Colorado-inspired state spending cap, Proposition 76, backed by Gov. Arnold Schwarzenegger. A half-dozen other states -- Maine, Ohio, Tennessee, Arizona, Oklahoma and Nevada -- are expected to consider TABOR legislation or ballot measures in 2006.

"It's unfortunate. The fundamentals of TABOR are sound and good. Other states would be wise to emulate our example," said Republican gubernatorial candidate Marc Holtzman, who ran ads opposing Referendum C.

The Colorado vote still might have to withstand a legal challenge. Jon Caldara, who ran the "Vote No, It's Your Dough" campaign against Referendum C, said he will consider filing a lawsuit to overturn the initiative.

Colorado's TABOR was approved by the voters in 1992 as a constitutional amendment, leading critics to ask whether it can be suspended by a statute.

Referendum C gained the backing of state Democrats and several prominent Republicans, led by Gov. Bill Owens, who campaigned heavily for the measure and said it was needed to fix a TABOR "glitch" that made it difficult for the state to climb out of recession.

The measure was opposed by many top Republicans and a coalition of national taxpayers advocacy groups, including the Club for Growth, Americans for Prosperity, FreedomWorks and Americans for Tax Reform.

Meanwhile, voters approved Initiative 100 -- 53 percent to 46 percent -- that allows people older than 21 to possess up to an ounce of marijuana.

Authorities were quick to note that the vote would have no real effect because marijuana possession is still a state and federal crime. The only difference is that violators now will be prosecuted in county court instead of city court, Colorado Attorney General John Suthers said.