Market forces affect tax base, property values

Just like harvest season, the local government calendar proceeds to its winter conclusion as Colorado assessors measure, then take stock of how the property tax base has fared for 2013. Last May, Colorado assessors mailed to all property owners the value of their property as of June 30, 2012. The values reflected changes in value from 2010 to the June 2012 date.

Many of you remember that your real estate value dropped or changed based on the market values between the above dates. These changes reflected market conditions, on a neighborhood-by-neighborhood basis, after close analysis by assessor appraisal staff.

Some neighborhoods sustained substantial losses while others more or less held their own. Such is the nature of real estate supply and demand. The tax base is dynamic for all counties and especially for a county that has a valuable resource that makes up a substantial portion of that base.

La Plata County had a tax base in 2012 in which 46 percent of the value was in oil and gas production and facilities. This year, the percentage of oil and gas properties is 37 percent of a smaller tax base affected by the drop in overall real estate value. This drop in oil and gas value can be attributed to lower prices paid for natural gas in 2012 and declining production.

While today it looks like the value of some real estate and the price of natural gas is rising slightly, the law requires taxing entities to operate with the smaller tax base we just certified to them. That means taxing entities will receive less revenue when tax bills go out in 2014 than in 2013. That will make for challenges.

The tax base can be much like farming, where the nature of market conditions, like the weather, affects the revenue people can generate to educate children, put out fires and otherwise provide for services they have come to expect. The assessor’s office is happy to talk about matters of valuation at any time. Call 382-6235.

Craig Larson, La Plata County assessor


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