This past November, the Colorado Legislature wrapped up a special session where they passed legislation to mitigate, at least to some degree, the substantial rise in Colorado property taxes this coming year. The governor is calling on local taxing entities to come to the rescue.
Over the past two years, home values have increased a statewide average of 40 percent. In mountain resort communities increases have been as high as 92 percent (source: Colorado Department of Local Affairs database).
After the impact of the expiration of the Gallagher Amendment (which had placed artificially low caps on property taxes) became known, legislators tried to address the sudden property tax increases with Proposition HH.
But Colorado voters voted against it in substantial numbers in the 2023 consolidated election, causing Governor Jared Polis to call a special session.
What voters got from that special session is a “light” version of Proposition HH, anyway. There are temporary tax credits, but the “can” that is a long-term fix was kicked down the road into the future. Impacts are apparent in the state’s “special districts” including school, fire, hospital, and EMS districts. Senate Bill 1 included a requirement that the state direct $200 million in general fund dollars to these districts’ budgets — but other districts won’t get any additional funding.
This past Thursday, November 30, while at Colorado Mountain College in Breckenridge, Polis called on taxing entities across the state to lower their local tax rates to provide relief for property owners for the expected major spike in property tax bills (due in 2024)
“Property owners are looking to their local elected officials for help, for reduction,” said Polis. “An increase (in taxes) next year would increase the cost of living, which is the opposite of what we want. … I know our local districts will step up.”
Translated, that means he’s asking county and municipal governments, as well as the hundreds of special districts to adjust their local tax mill levies. But the 2024 fiscal year budgets for municipalities, counties, and special districts are already built and approved. Special districts, including fire safety and water providers, are indicating that the state has no business telling local governments what decisions to make.
“I’m confident that special districts are more than capable of assessing their needs and governing their finances without encouragement from the governor,” said Special District Association of Colorado Executive Director Ann Terry. That association represents about 2,600 special districts in the state.
So, time will tell. There may be at least 64 different local solutions or none at all.
Editor’s note: Colorado has 64 counties, more than 2,600 special districts, and hundreds of municipalities.
It should be noted that Salida has no property tax. Therefore is unable to lower a mill levy that is already zero.
The city of Salida does control the South Arkansas Fire Protection District which levies property tax.