Referendum C2, a voter-approved revenue change passed in 2005, allowed the state to retain and spend all revenue collected between FY 2005-06 and FY 2009-10.  For FY 2010-11 and all succeeding years, Referendum C allows the state to retain and spend all revenue collected up to the "Referendum C cap," grown by inflation plus population growth from FY 2007-08 revenue, provided that revenue retained in excess of the pre-2005 "TABOR limit base" be spent for certain programs.  

Surplus revenue in excess of the Referendum C cap must be refunded to Colorado taxpayers.  The money is refunded from the state’s general operating fund, known as the “General Fund.”

The TABOR Amendment requires voter approval for tax increases.  Fees, which are not addressed in this handbook, can be increased by the state legislature without voter approval.

Voter approval is also required to increase the TABOR limit, which constrains state revenue from both taxes and fees.