Colorado voters rejected a statewide ballot measure that would have increased school funding and chipped away at the fiscal constraints that have governed Colorado for more than 25 years.

Proposition CC would have done away with revenue caps on Colorado’s state budget and provided millions more for schools — but that money could only have been spent on one-time expenses.

With more than 1.3 million ballots counted Wednesday morning, 55.1% of voters were opposed and just 44.9% were in favor. The Associated Press called the race a little before 9 p.m. Tuesday.

Proposition CC was seen by both supporters and opponents as a test of voter support for the Taxpayer’s Bill of Rights, the 1992 amendment to the state constitution that requires voter approval for all new taxes and limits increases in state revenue to the rates of population growth and inflation. Any money collected above that cap must be returned to taxpayers as refunds.

“We were up against misleading ballot language and millions of dollars of out-of-state money pouring in against us, but thankfully our Taxpayer’s Bill of Rights is preserved,” said Michael Fields, executive director of the conservative group Colorado Rising Action, in a statement. “Coloradans want TABOR, and we want the legislature to prioritize the massive budget they already have.”

Proposition CC was placed on the ballot by lawmakers. The Yes on CC campaign, Coloradans for Prosperity, spent almost $4 million on the effort to pass it, with much of the money coming from nonprofits that don’t have to disclose their donors.

The Colorado Education Association, the state’s largest teachers union, said the state “fell short” by rejecting the measure and that education advocates would continue to push for more funding and structural changes to fiscal policy.

“Proposition CC would have been just one step forward, but not a solution to delivering the schools our students deserve,” said Amie Baca-Oehlert, president of the union. “After decades of disinvestment, TABOR continues to strangle our public services. Coloradans want to see bold, structural changes in tax and budget policy that benefit everyone, not just the wealthy few.”

The defeat of Proposition CC comes one year after they rejected Amendment 73, a tax increase on higher earners and businesses that would have generated $1.6 billion for K-12 education.

Instead of asking voters to raise taxes, Proposition CC asked voters to let the state keep all revenue from existing taxes. A third of this additional money would go to transportation, a third to higher education, and a third to K-12 education. Under current law, the state has to issue refunds whenever revenue goes above a cap dictated by population growth and inflation.

The proposition took a very different approach to increasing funding for schools and would have had a more modest impact on classroom funding. Money would have only been available in good economic times, and schools would have only been allowed to spend it on one-time expenses.

Nonetheless, it could have represented hundreds of millions of dollars over the next three years.

“Despite tonight’s loss, our needs – better schools, safer roads, stronger family supports – aren’t going away,” Scott Wasserman, president of the Bell Policy Center, a left-leaning think tank that works on economic policy issues, said in a statement. “It’s clear those who are paid to protect TABOR over the needs of Coloradans will misrepresent whatever we put on the ballot. Whatever we do next must be bold enough to drown out the alarmists.”