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Senator Michael Bennet joined Chaffee BoCC at the groundbreaking for the Chaffee County North-End Public Safety Complex. From left to right: Greg Felt, P.T. Wood, Keith Baker, and Senator Bennet. Photo by Jan Wondra.

On December 8, the Chaffee Board of County Commissioners (BoCC) issued the letter below to the community regarding Chaffee County Property Taxes:

Dear Chaffee County Residents, Businesses, and Property Owners –

Chaffee County Board of County Commissioners and Administration recognizes that the significant property value increases in our community have created concern for many people about the impacts of increased property taxes.

Chaffee County Government has long prided itself on serving as thoughtful stewards of its constituents’ tax monies, and we are always working to strike the right balance within the budgetary demands of providing services to all our citizens and maintaining sensitivity for our residents and businesses’ own budgets and financial circumstances.

As many local residents know firsthand, Chaffee County, like much of Colorado, has seen significant increases in property valuation since the last assessments were completed in 2021. From 2023 to 2024, the total assessed valuation of property in Chaffee County increased by $270,987,030 (from $624,105,600 to $895,092,630). These property valuations are conducted every other year by the County Assessor’s Office through a statutorily-directed process based on local real estate transactions.

It is important to know that although assessed property valuations across Chaffee County have increased 43 percent over this period, the property taxes levied and received by the County do not also increase at that same level.

There are inherent restrictions in revenue growth that dictate what amounts are available for the County. Chaffee County is subject to tax revenue limitations through the Taxpayer Bill Of Rights (TABOR) and a statutory property tax revenue limitation called the 5.5 percent Property Tax Revenue Limit, also known as the “Annual Levy Law” (per Colorado Revised Statute, section 29-1-301 et seq).

These laws limit the amount of total property tax revenue that Chaffee County Government may collect each year, with the most restrictive of the revenue cap limits being applied in any given year. (Please note the limit does not apply to the tax bills of individual property taxpayers because the limit applies to the total property tax revenue collected on all property taxpayers in a local government.)

Local property taxes are calculated through “mills”

A mill is a tax rate equal to $1 in property tax levied per $1,000 of an individual property’s assessed value. Chaffee County Government property taxation includes only 13.657 mills of the total mill levies across jurisdictions. In the most recent tax year, these totals ranged from 47.692 to 60.943 mills, with specific amounts dependent upon the individual taxing district in which a property is located. However, the amounts actually collected by the County are reduced to 6.430 mills due to temporary tax credits of 7.602 mills (totaling an estimated $6,804,494 in waived tax revenues in 2024), which have been in place since TABOR became effective in the early 1990s.

According to the state Division of Property Taxation, Chaffee County historically has one of the lowest average county mill levy amounts in all of Colorado, with only 4 of 64 counties having lower average levies in 2022. Individual Chaffee County property owners’ levy amounts will vary based on the location of their property/properties, and may also be impacted by mandated restrictions such as TABOR and/or voluntary reduction of mills within the entities that have the legal authority and ability to adjust them.

Chaffee County’s preliminary estimates for the 2024 budget year reflect a total increase in property tax revenues of ~$396,875 over 2023 ($5.75 million versus $5.35 million); this amounts to a ~7.7 percent increase in property tax receipts for the coming budget year compared to last year.

For 2024, property taxes account for only ~8.6 percent of the County’s budgeted revenues across all funds (including General Fund, Road & Bridge, Human Services, Retirement, and Capital Expenditures), and cover ~7.26 percent of total appropriated expenses. These initial calculations were made prior to the passage of the “2023 Property Tax Relief” bill (Senate Bill 23B-001) on November 20th, and Chaffee County property owners’ final 2024 property taxes and the County’s tax receipts will be affected by the valuation reductions promulgated in this new legislation.

The Chaffee County Assessor’s Office is actively working on updating assessments to include the valuation reductions instituted in SB23B-001, and anticipates finalizing these numbers by the end of the year. These updated valuations will utilize the temporary reductions the state has applied to the actual values of properties and the reduced property assessment rates for residential properties that will be in place for 2024 and 2025.

More information on these changes is available from the Colorado Department of Local Affairs at https://dlg.colorado.gov/budget-information-and-resources.

As Chaffee County works to weather the current economic conditions with widespread inflation and growing costs for labor and healthcare expenses, our own budgeting also continues to tighten. The County’s General Fund operations are funded primarily through sales tax, property taxes, and building permit fees, none of which are keeping pace with cost increases.

Additionally, sales tax gains have continued to slow compared to recent years, projected to be only 1.5  percent higher in 2024 than 2023 (~$120,000 increase). Building Permits, the third main pillar of the County’s General Fund revenues, are forecast to decrease by 20 percent in 2024 compared to 2023 ($1.3 million versus $1.62 million).

Though operating within these annual budget constraints, the County continues to focus on the community’s current and long-range infrastructure needs and priorities, as well as our commitment to providing strong and responsive programs and services. Utilizing a combination of ARPA monies, capital reserves, debt financing, and grant funding, the County is currently working on >$43 million dollars of investments in major capital projects like the new North End Public Safety Complex facility outside of Buena Vista, replacement of the historic Granite Bridge, County Landfill expansion, supporting the Chaffee Housing Authority’s Jane’s Place affordable housing development in Salida, replacement of the Salida Airport Underground Fuel Storage Tanks, County Fairgrounds upgrades, relocating the Sheriff’s Office headquarters, and other local long-range structural needs including roads improvements and workforce housing.

However, these investments have also depleted the County’s reserves, which we will need to focus on rebuilding in coming years to equip us to meet future needs and ensure resilience during economic downturns and times of adversity.

The Local Taxing Landscape is Broader than the County

Finally, it is helpful to understand that Chaffee County is only one part of the local taxing landscape. Chaffee County Government staff and the Board of County Commissioners have no authority on the financial decisions or possible mill levy adjustments for the other 13 other local taxing entities within the county.

Other local taxing districts and their mill levy rates as of Tax Year 2022 include the Buena Vista School District R-31 (35.951 mills), Salida/Poncha School District R-31-J (29.058 mills), Town of Buena Vista (5.875 mills), South Arkansas Fire Protection District (4.519 mills), Colorado Mountain College (4.085 mills), Chaffee County Fire Protection District (4.021 mills), Southern Chaffee County Library District (3.503 mills), Northern Chaffee County Library District (2.5 mills), Town of Poncha Springs (2.271 mills), Buena Vista Sanitation District (1.55 mills), Salida Hospital District (1.135 mills), Upper Arkansas Water Conservation District (0.438 mills), Southeastern Colorado Water Conservancy District (0.887 mills). The “Animal Shelter Fund” tax (0.5 mills, being reduced in 2024 to 0.375 mills) is collected through the County and provided as a pass-through to Arkansas Valley Humane Society (AVHS) for providing county-wide animal sheltering services. The evaluations and decisions on the mill levies within each of these jurisdictions are made by those individual taxing authorities based on their own budgetary needs and plans for 2024 and beyond.

County leadership continues to work to optimize efficiency and efficacy in our operations to make the highest impacts with our limited community resources, as well as prioritize opportunities for collaborations and grant funding that positively leverage our local dollars. We truly appreciate our taxpayers’ investment in the work Chaffee County Government does for the community, and we are honored to serve you.

Sincerely,

Your Chaffee County Board of Commissioners

Keith Baker, Chairman

Greg Felt, Commissioner

P.T. Wood, Commissioner