County services may not be harmed by Polis property tax plan

BY ELLIS ARNOLD EARNOLD@COLORADOCOMMUNITYMEDIA.COM

As pressure mounted on state lawmakers to intervene in Colorado’s expected spike in property tax bills, Douglas County o cials worried that setting the cap too low could hurt funding for local government services.

Politicians on the left and the right agreed that homeowners need relief as property taxes are expected to increase this year. Driven by a costly real-estate market, home values — as calculated for property tax purposes — have spiked since the last time homeowners received notices of value two years ago. Since then, residential properties in the Denver metro area typically saw value increases between 35% and 45%, a group of county assessors from across the Front Range announced April 26.

at rise threatens to take a big bite out of families’ nances because even when tax rates themselves aren’t increasing, the amount that homeowners owe increases as the value of homes rise.

If a proposal from Gov. Jared Polis and Colorado Democrats wins approval from voters this year, the rise in homeowners’ property tax bills could decrease by double-digit percentages.

e governor’s o ce provided an example scenario where a $600,000 home increased in value by 30% in the 2023 property valuation, which is based on June 2022 real-estate market values, compared to the 2021 valuation, which was based on June 2020 market values.

Factoring in the recent property tax relief law known as state Senate Bill 22-238, that home would see a 24% increase in its property tax bill, according to the governor’s o ce.

If Polis and the Democrats’ proposal gets the OK from voters, the increase could fall to as low as 12%, according to the governor’s o ce. But the amount of relief won’t play out the same across the state, and the picture could look especially different in Douglas County.

“I don’t believe property tax bills will be only going up 12% in Douglas County,” said Commissioner Lora omas, one of Douglas County’s elected leaders.

County could act on tax relief

In a place with notably high home prices like Douglas County, the amount of increase in property tax bills could outpace many other areas of the state.

In Douglas County, residential properties saw increases in value between 30% and 60%, with a median of 47%. at includes single- family homes, condominiums and townhomes, according to Douglas County Assessor Toby Damisch. He’s the o cial who oversees the process of valuing property in the county. e budget that Douglas County o cials wrote for 2024 was based on expecting a 9% property value increase, omas, a county commissioner, has said.

Property taxes partly fund county governments, but they also fund school districts, re and library districts, and other local entities.

If Colorado voters decide to approve the Democratic state lawmakers’ proposal in November, the remaining amount of increase in property tax bills could still give Douglas County more revenue than it was expecting.

“At 9%, we can deliver the services we need to. Obviously, I’m one of three (commissioners), but if there’s more than that, we would do a tax credit like we have ve of the seven years I’ve been a commissioner,” omas said.

If the increase is 10% or more, omas said she would vote for what’s called a “temporary mill levy credit” to reduce residents’ tax bills. (Property tax rates are o cially called “mill levies.”) e county has authorized such credits in 2017, 2020, 2021, 2022 and 2023, e ectively lowering county revenue by $30 million.

Plan comes with caveat e catch: e Democrats’ plan would also allow local governments to override the cap after giving notice to property owners, according to the governor’s o ce. metro districts SEE TAX PLAN, P9

Colorado Democrats proposed a multi-pronged plan, and one of the parts is to cap the growth in district property tax collections, excluding school districts, at in ation.

(“Districts” means any type of local government — such as counties, re ghting districts, metropolitan districts and others — that imposes a property tax.)

Going back to that general example of a home previously valued at $600,000, the increase in its property tax bill if the proposal is approved would be 12% if districts stay under the local cap, according to the governor’s o ce. But if the proposal goes through and governments waive the local cap, the home’s property tax bill would see a 19% increase, according to the o ce.

Living within a metropolitan district, such as Highlands Ranch, can make a big di erence in a home’s total property taxes, omas has said. Metro districts are a type of government entity that can o er some government services.