Colorado’s grand bargain on property taxes concluded Wednesday as Gov. Jared Polis signed a bill that further cuts commercial and residential rates, while a conservative group withdrew two contentious initiatives from the November ballot.

The legislature passed House Bill 1001 last week during its second property tax-focused special session in the past year. Polis called lawmakers back to the Capitol in mid-August to ratify the deal his office and legislative leaders had struck with Advance Colorado, a conservative advocacy group, and Colorado Concern, a business organization backing Advance Colorado’s ballot measures.

The deal called for additional property tax cuts, on top of larger reductions passed in May, in exchange for Advance Colorado removing two ballot measures that would have cut taxes more steeply and capped property tax growth more stringently for local governments and districts.

“With this final piece, I think we have the predictability and stability we need to save homeowners money and do budgeting for schools and make sure we do not have the resurgence of the negative factor,” Polis said. He was referring to the budgeting mechanism that had chronically underfunded state schools for years, but which state officials ended in this fiscal year’s budget.

Polis had previously said he would not sign the bill into law until the two ballot measures — initiatives 50 and 108 — were formally pulled from the ballot. The Colorado Secretary of State’s Office confirmed Wednesday morning that both had been withdrawn.

The deal also included a promise from Advance Colorado not to pursue additional property tax-cutting measures for at least six years. No statutory requirement underpins that promise, but House Speaker Julie McCluskie, a Dillon Democrat and one of HB-1001’s sponsors, expressed hope during Wednesday’s ceremony that “this is the end of our conversations about property tax for at least the next six years.”

“It is unfortunate that we had to play defense — that we had to come forward and provide yet additional relief — because wealthy interests in this state continue to bring forward ballot measures that would ultimately undermine the stability of our communities,” imperil school funding and put budgets for local services like fire departments at risk, she said. Those risks elevated frustrations that had been prominent within her caucus last month.

Sen. Barbara Kirkmeyer, a Brighton Republican and another sponsor, called the legislation passed this year “the largest property tax cut in Colorado’s history,” though the impact of the special session bill is smaller than a companion bill passed by lawmakers in the spring.

“When you combine what’s going to happen with 2025, with 2026, it’s nearly $2.4 billion,” she said.

The bill signed Wednesday initially adds roughly $254 million in additional cuts to the $1.3 billion worth of reductions approved in May. The bulk of the latest cuts will benefit commercial property, according to an analysis by the Colorado Fiscal Institute, a progressive think tank.

Polis said those reductions should benefit commercial tenants — who, he said, typically foot the bill for increased property taxes.

For homeowners, the measure is expected to clip between $60 and $80 from a typical property tax bill in the 2025 tax year, plus roughly $179 the following year. That’s on top of an average $400 in savings from the measure passed in May.

For supporters in the legislature, the compromise meant accepting relatively modest additional tax relief in exchange for neutralizing two ballot measures that Democrats said would have “catastrophic” and “draconian” effects on state and local budgets.

“I believe today marks the culmination of at least six years’ worth of work,” said Sen. Chris Hansen, a Denver Democrat and another architect of the deal. He was referring to the work undertaken to repeal the Gallagher Amendment in 2020 — and then grapple with the loss of that law’s tax-stabilizing protection for homeowners.

Twenty-two legislators out of 100 voted against the deal during its journey through the Capitol last week. Most were Democrats frustrated that it was negotiated behind closed doors with deep-pocketed conservative and business groups.

Critics repeatedly likened the situation to negotiating with hostage-takers, and some Democrats spent last week referring to Advance Colorado’s president, Michael Fields, as “Gov. Fields.”

Several legislators told The Denver Post last week that they doubted the armistice would last. That feeling was in part rooted in a lack of trust between the initiatives’ backers and legislators, many of whom thought that the measure passed in May was already a compromise.

On Wednesday, the deal’s architects struck a more optimistic tune. Polis said he hoped the deal would provide property tax stability for a generation, and his office — in its release announcing the bill-signing — heralded that “the property tax wars are over.”

Kirkmeyer thanked Advance Colorado and the initiatives’ proponents and said that though there had been “trust issues,” the proponents had kept their word.