At yesterday’s work session at the Archuleta County administration office, the Archuleta Board of County Commissioners heard from County Assessor Johanna Tully-Elliot regarding the property tax changes passed by the Colorado General Assembly and signed by Governor Jared Polis on November 20.
SB 23B-001 reduced the residential assessment rate for the 2023 tax year to 6.7%, a very slight reduction from 6.765%. Additionally, homeowners will be able exempt $55,000 of their home’s value from taxation. That amounts to about $430 million in property tax relief across the state.
To help pay for the rate cut, the bill will use $200 million in general fund money set aside for this purpose. School, fire, hospital and ambulance authorities will be repaid completely for the revenue they will miss out on due to lower tax rates. After that, local governments will be partially repaid depending on how much their assessment values have grown, so areas with slower growth, under 15%, will see more money and areas with bigger growth will see less, if any.
The reductions will apply only to the 2023 property taxes that will become payable this coming winter and spring. For the longer term, the Legislature voted to create a commission to future property tax reductions. That bill was also signed by Governor Polis.
Ms. Tully-Elliot and her staff now have their plates full, trying to get estimated ‘certification’ amounts to 30 local governments and special districts that benefit from property taxes, over the next couple of weeks. They will also need to re-calculate the correct tax amounts and get them into the mail to the community’s property owners by late winter. The state has extended the normal deadlines for these Assessor requirements.
Ms. Tully-Elliot explained that some government entities will receive “backfill” funding to make up for the reduced property taxes collected, but it’s not yet clear how much that amount will be nor which counties will receive it. She recommended the BOCC not count on receiving money from that allocation.
Ms. Tully-Elliot didn’t mention that Archuleta County may still be able to collect about 5% more than it collected last year, but — due to Colorado’s TABOR Amendment — will not benefit fully from the estimated 30%-40% property tax increases paid by typical Pagosa Springs property owners next year.
The Assessor staff had previously calculated tax assessments based on a $15,000 exemption on all residential properties, and a $30,000 exemption on commercial properties. The office will now need to recalculate the residential exemption at $55,000, as set by SB 23B-001. This will amount to a tax reduction of about $250 for each residential property. Vacant properties will not see any reduction in valuations.
The tax reduction caused by the change from 6.765% to 6.7% will amount to less than $30 for most Archuleta County homes.
Ms. Tully-Elliot:
“[The General Assembly] is putting together the property tax commission — there’s one assessor on that commission — and they are looking at ways to reform property tax. Who knows what’s going to come from that? There’s a proposal to limit increases to 4%. There’s a proposal to do the reappraisal every four years instead of every two years. Or that your value is what you paid for it. There are all kinds of ideas and initiatives out there right now on property tax.
“So this work now is just a band-aid on a big open wound.” She laughed.
Commissioner Ronnie Maez:
“I think it’s clear as mud.”
Assessor Tully-Elliot:
“It’s clear as mud for us, too. We’re taking it one day at a time and one step at a time, because these numbers are so important for all the local taxing authorities, and they depend on our numbers being correct…
“It’s very time-consuming to redo all these calculations…”
Ms. Tully-Elliot noted that the $55,000 exemption on residential property applies equally to all homes, including those who protested their valuations last summer.
The tax decrease for commercial properties will be about $420 per property.
Commissioner Warren Brown:
“Are you going to post all this information on your website, Johanna? So that anyone with the ‘special decoder ring’ can figure it out?”
His comment elicited hearty laughter.
Assessor Tully-Elliot:
“I think there was a lot of relief when Prop HH didn’t pass.
“Then we heard the Governor say, ‘We’re going to do this anyway.’ So I think there’s some… I don’t know how to say this… people wondering, ‘Well, we voted this down, and you’re going through with it anyway. What does our vote matter?’ Because he went ahead and did what he wanted to, anyway. HH was voted down 60% to 40%, I believe. So people are getting even more skittish about government…”
Commissioner Maez:
“Yeah, another reason not to trust the government…”
Although I basically agree with our Assessor, this little exchange frankly rubbed me the wrong way. Yes, the people sitting around the work session table yesterday may be Republicans and may have problems with our Democrat governor and with the Democrat-led state government. But SB 23B-001 was not the same program voted down by the electors in November. Prop HH would have granted a similar level of property tax reductions — but it also would have reduced, and eventually eliminated, the TABOR refunds required by our existing constitution.
SB 23B-001, by contrast, left our TABOR refunds intact, while reducing property taxes. I look forward to further changes in the state government’s tax laws to better protect low-income families in our state, and to close the ‘big open wound’.
We might also note that Commissioner Maez voted twice to put a new County jail before the voters — in 2017, and again in 2018 — and it was voted down twice. Then he voted with his fellow commissioners to build the jail anyway, putting the Archuleta County taxpayers $20 million in debt without their approval.
Another reason not to trust the government?