SUMMIT COUNTY — Proposition 101 will be pondered by many voters come November — and with some confusion. How it will affect Summit County is still being determined, and how it will work with Amendments 60 and 61 is even more convoluted.

So what is 101, and what does it mean for Coloradans locally and statewide?

First and foremost, it's a code change that, if approved, will reduce or eliminate taxes and fees on vehicle purchases, registrations, leases and rentals over the next four years. It will also eliminate all state and local taxes and fees on telecommunication services, except 911 fees. And it will require voter approval to create or increase fees on vehicle and telecommunication services.

For town governments specifically, loss and/or reduction of all these fees will directly affect general fund operating expenses on a local level.

But supporters of 101 say its a good thing to shrink governments.

“We want to cut the size of the government,” said Erik Larsson, a local business owner in support of Proposition 101, as well as Amendments 60 and 61. “It's actually what makes Colorado a growth state.”

Natalie Menten, campaign coordinator for CO Tax Reforms, which is supporting the ballot measures, said in an interview with SDN reporter Julie Sutor that the vehicle taxes are completely unfair.

“Citizens will have more money in their pockets to buy something,” Menten said. “Businesses will have more money to buy equipment and hire more employees because they have more money. I see it as a boost to our economy.”

Perhaps not surprisingly, that's not how affected local governments see it. Here's an overview of potential outcomes outlined by those local governments and other entities:

The ballot questions AMENDMENT 60 would cut mill levies, with the state making up the shortfall in school funding, and allow voters to roll back previous approvals of governments retaining more tax revenue. AMENDMENT 61 would require local governments to get voter approval to borrow, require debt to be repaid within 10 years and prohibit all borrowing by the state government. PROPOSITION 101 cuts state income taxes from 4.63 percent to 3.5 percent over time, reduces vehicle-registration fees and taxes and eliminates all taxes and fees on phones except for 911 service.

Frisco

According to the Town of Frisco, Proposition 101 — alone or in conjunction with Amendments 60 and 61 (other issues on the ballot) — will have serious impacts on both state and local governments. The Town also said 101 reduced a large source of funding for schools and special districts — the loss is thought to be around $500 million for state municipalities.

“The Town of Frisco stands to lose $210,000 a year which is currently the annual non-salary budget for all of our street maintenance,” stated a Town memo. “In addition, the state will lose up to 25 percent of its income tax revenue. This will impact the state's ability to fund services to schools, colleges, prisons, firefighters and police, and water and sewer systems.”

The memo also said 101 would affect Frisco by decreasing street maintenance dollars by 38 percent.

Town manager Michael Penny added that, if passed, 101 will essentially end Frisco's Main Street revitalization project. Frisco's “Step Up Main Street” revitalization plan — a large project to upgrade much of the town's main drag — is on hold until funding is available.

“We wouldn't be able to bond it,” Penny said. “We'd have to try to piecemeal it over a number of years. Construction would impact businesses longer because the project is already delayed due to the economy.”

Though Penny said smaller municipalities would be hurt the least overall by 101, “they'd be incredibly impacted because state grants are huge. We all get money from the state. There are significant, indirect, unknown impacts.”

About the series On this year's statewide ballot, voters will be asked to consider three questions that will have significant impacts on how state and local government funding works. Not since the passage of 1992's ‘Taxpayer Bill of Rights” (TABOR) amendment have Colorado voters faced such potential to change how government taxes and borrows. Proponents of the measures say it's all aimed at limiting government and lowering taxes, while opponents say they'll put the state in an even more dire financial position than it is already. The Summit Daily's five-part series this week focuses on how these measures are likely to affect Summit County. The series: Monday: Impacts to Summit School District today: Effects on Colorado Mountain College Wednesday: Effects of Proposition 101 on local government Thursday: Effects of Amendment 60 Friday: Effects of Amendment 61

Dillon

The Town of Dillon estimates that, if passed, the town could stand to lose $137,284 in 2011, $143,943 in 2012, $150,603 in 2013 and $157,263 in 2014 — according to a memo written by Dillon's finance director Carri McDonnell

Town manager Devin Granbery said it's easier for Dillon to calculate the affects of 101, rather than 60 and 61, as 101 will cut into general operation fund revenues.

Granbery also said these ballot initiatives will create a “trickle-down effect. Impacts at the state level will impact town funding through grants.”

Silverthorne

If 101 passes, Silverthorne estimates big reductions to its general fund, to the tune of $248,058 in 2011 alone. The Town also predicts it will lose $265,605 in 2012, $283,152 in 2013 and $300,699 in 2014.

“Other potential impacts could include the elimination of state grants due to decreases in state funds collected in income tax,” said a Town memo written by finance director Donna Braun. “CDOT (Colorado Department of Transportation) funding would be reduced and very limited. Additional cuts from Highway User Tax normally given to the Town from the state would likely be reduced since the state controls distribution. The telecommunication fees collected/distributed by the state for 911 services would be eliminated, resulting in a higher charge to the police department for sharing dispatch services.”

Frisco's town manager Penny also said the highway interchange project planned for I-70 in Silverthorne would likely die if 101 passed.

Breckenridge

The Town of Breckenridge said in a memo that 101 cuts would reduce its general fund revenue stream by an estimated $428,000 in 2011. This loss would increase incrementally to $534,000 by 2014.

“While proposition 101 would reduce revenue to the Town substantially, it would severely harm the state's revenue streams for CDOT,” said Breckenridge financial services manager Brian Waldes in a memo to town council. “The lack of funding for highway maintenance would have adverse impacts on state-maintained roads throughout the Town. The impacts from the deterioration of I-70 and other roads that access the Town would be hard to measure at this time. In addition, Prop. 101 would reduce Colorado's state income tax to 3.5 percent over four years. The crippling effect this reduction would have on state revenues would almost certainly have a trickle-down effect on the Town.

Other entities

Steve Lipsher, spokesman of the Lake Dillon Fire District, said Proposition 101 would negatively impact for fire services too.

“Lake Dillon Fire ... receives about $275,000 in specific-ownership taxes collected for vehicle registrations, which would be cut about 99 percent, to $3,261. Put another way, the average vehicle owner paid $15.80 in specific-ownership taxes to the fire district; under Prop. 101, that would drop to 15 cents.”

Summit County finance director Marty Ferris said 101 would impact the county by $1.013 million initially, and by 2014 it would be creating a $1.6 million impact. This would cause problems with county roads, etc., she said.

“Everybody is still trying to determine the impacts,” said Upper Blue Sanitation District director Andy Carlberg. “And it seems that new impact arise every day. People keep thinking of things. The idea to lower taxes is great. It's just we've got to think beyond and see what the additional impact are going to be.”

The Colorado Municipal League (CML) has numerous concerns as well.

“Passage of these measures would seriously erode the reliability of basic services, the attraction of new business to the state, and our ability to enjoy the quality of life we have created for our families,” stated a CML memo.

However, Larsson — the local owner of Simply Massage and a supporter of all three measures — said low taxes are pro-business.

“I think the economy will continue to grow at a better rate,” Larsson said. “Low tax rates also encourage marginally profitable businesses to exist. ... A lot of people read these things and don't want to cut funding for school buses and roads. When you vote to cut taxes, it forces the government to cut the least necessary programming. Any anti-tax initiative will force the government to reappropriate funds where it's most necessary from where it is least, and this shrinks government.”