Hickenlooper releases 23 years of tax returns
Sunday, April 25, 2010 at 12:05 am
Democrat Hickenlooper released 23 years of returns, which list nearly $3 million in charitable gifts of cash, stocks and real estate.
“You realize when you run for office that there needs to be a certain amount of public disclosure,” Hickenlooper told the Colorado Independent in a conversational meeting with reporters from just three outlets Wednesday. “People want to be able to believe in government, and that comes down to trust.”
McInnis’s office said his most recent returns would be available for viewing at an attorney’s office by appointment. The Colorado Independent expects to review those returns Monday.
Hickenlooper has earned more than $16 million since 1985, with the vast majority of it coming from his restaurant business and other investments, peaking in 2007 when he sold most of his restaurant business, declaring a profit of nearly $5.8 million. He still owns parts of two restaurants—one in Ft. Collins and one in San Francisco. He also owns an interest in two prominent downtown buildings, housing Dixon’s restaurant and the LoDo Tattered Cover.
Hickenlooper gave copies of his 1040s and his schedule-As to the media. The 1040 forms list income and taxes paid, with income broken down into categories such as earned income and interest income. The forms do not, however, show much detail with regard to the sources of income. Schedule As detail itemized deductions, such as charitable contributions and mortgage interest, but again without much detail.
Hickenlooper said he began investing in real estate while still in college, buying a house for $26,500, with $1,200 down. He fixed the house up, then borrowed against the increased equity in order to buy another house. He followed that by buying a one-third interest in a community health building, all in Connecticut.
After being elected mayor, he placed most of his assets into a blind trust, and did not even know he was selling his interest in the Wynkoop and other restaurants until a few days before the deal closed.
Hickenlooper’s tax returns tell two stories. One is of the man earning about $60,000 a year as a geologist, who loses his job, earns barely $15,000 the next year, mostly from interest and dividends, and then goes all in to open the Wynkoop Brewery, Colorado’s first brew pub, in 1988. He works hard through the lean years, almost throws in the towel at least once, but perseveres, borrowing from his aunt, his brother, and his landlord, among others.
The gamble pays off. Additional restaurants follow. He becomes rich beyond his wildest dreams, finally leaving the business he loves to run for mayor.
The other story is of a man who has given away roughly 17 percent of every dime earned.
Feeding both narratives is the story of a boy raised by a mother who grew up in the depression and washed and re-used Saran Wrap.
A debt owed to mom
Growing up, Hickenlooper said he was determined never to be poor as an adult. Watching his mother find a way to give to charity even when she had next to nothing made an impression. “You can always find a way to give.” He said he looks at both his success and his generosity as “almost a way to repay my mother.”
Hickenlooper Campaign Communications Director George Merritt declined to list the names of the charities Hickenlooper gives to. He said giving out that kind of information could create hard feelings among the groups.
Hickenlooper noted that in some years it looks like he made more money than he actually received. In the early years of the restaurant business, he said most of the profits went back into the business. “I would take just enough to pay my taxes. We paid ourselves $1,500 a month, if we had it.”
As much as he seems to enjoy being mayor and running for governor, it is clear he also misses the restaurant business. “When you work 70 or 80 hours a week someplace, all of your emotions are there, your life is there. I thought (son) Teddy would work there someday. Who knows, maybe he will,” Hickenlooper said.
Finding boxes of returns in his basement, hauling them upstairs, and looking at them for the first time since filing them was interesting, he said. “You re-live your life. You remember the anxiety.”
The tax-return tradition
Bob Loevy, political science professor at Colorado College, says candidates began releasing tax returns as a campaign tactic in the 1970s. “It was a spin-off from Watergate. Candidates wanted to prove how clean they were. They wanted to attract voters by creating a more transparent image. Of course, if one does it, then their opponents may feel the need to explain why they won’t do it. It comes down to the question of whether someone thinks releasing the returns will bring them votes or not.”
In the years covered by the returns, Hickenlooper has paid a little more than $2.5 million in federal income tax, for an average rate of 15.4 percent. In most years, returns on investments, as opposed to wages, constitute the bulk of his income. In 1994, for instance, he earned a salary of $23,000 at the Wynkoop but topped $500,000 in investment income and capital gains, which are generally taxed at rates lower than earned income.
Of course, charitable giving also drove down the rate. Hickenlooper said this was one of the few countries that gives a tax deduction for charity, a fact that he said makes citizens and the government partners with non-profits.
His charitable giving began before he got rich. In 1986, he gave away $9,200 on an income of $62,000. In 1987, he gave $2,900 out of an income of $15,000. In 2008, he gave away almost $120,000 out of a joint income of just under $500,000. The most he has given in one year was $626,235 on an income of just over $1.3 million in 2004.
Since 2002, he has filed jointly with wife Helen Thorpe, a writer.