Log In


Reset Password
News Education Local News Nation & World New Mexico

Mill levy increase to go to voters

Early polling predicts passage

If voters approve a mill levy increase in November, the measure will end La Plata County’s nearly 25 years of a stagnant property tax.

Up to 2.4 mills is the county long-term finance committee’s recommendation, which would increase the current mill levy of 8.5 mills to a maximum of 10.9, which could be decreased at the commission’s discretion.

A mill is defined as $1 per $1,000 of assessed value.

In May, approximately 480 La Plata County voters were asked if they would support a tax increase to fund road and bridge infrastructure. More than 60 percent of respondents approved.

Residents of La Plata County were less enthused in 1986, when a contentious tax proposal was put to voters. That year, the county commission advised a levy increase of nearly 70 percent – from 10.543 to 17.843 mills – in anticipation of a $1.8 million budgetary shortfall in 1987.

The county was also under pressure, and statutory obligation, from a 6th Judicial District judge to expand courthouse facilities.

In 1992, Colorado’s Taxpayer’s Bill of Rights placed limits on state and local governments, requiring voter approval for proposed tax increases to take effect. Governments were also prohibited from spending tax revenues without voter approval if revenues are growing faster than the population and rate of inflation.

La Plata County was ahead of the curve on TABOR in the mid-1980s. Though the measure failed statewide, it passed in La Plata County. So it wasn’t a surprise when the proposed 70 percent mill increase was voted down and budgetary cuts ensued as predicted.

The most recent time property taxes were increased in La Plata County was in 1991. In 1990, a board established a mill levy of 8.572 mills for the 1991 budgetary year. The 1990 budget mill levy was set at 8.424 mills. In the early 1990s, the mill levy also included a portion to cover expenses of the Home Rule Committee, which was charged with exploring the possibility of converting La Plata County from a statutory county to a home-rule county. The ballot item came before voters twice but never passed, thus the committee disbanded and its associated mill levy went away.

The study released last spring illustrated not only support for the tax increase but also general satisfaction with the county’s conduct. According to the report, two-thirds of respondents felt they pay “the right amount” in local taxes, and 54 percent said the county was “heading in the right direction.”

Out of Colorado’s 64 counties, La Plata County still ranks in the lowest 50 percent for median property tax. According to tax-rates.org, the median property tax paid by residents is $840 annually. Douglas County was ranked highest with an annual median rate projected at $2,590. The site reports a median of $1,437 for the entire state.

“For many moving from out of town, they probably won’t care,” said Fort Lewis College economics professor Tino Sonora. “When I moved here, I had been paying $5,000 per year, and that was 10 years ago. Also in Durango, we have inelastic demand, which means people’s demand is not responsive to price changes. At least in town, I don’t think it will influence people’s decisions whether to buy.”

A tax increase inherently affects affordability, and recently, Federal Reserve Chairwoman Janet Yellen suggested interest rates will rise this year. Paired with a property tax increase, that could potentially affect buyers, said real estate agent Don Ricedorff. Others, though, such as Tom Caver, a community broker since 1978, echoed Sonora’s beliefs that a tax increase not to exceed 2.4 mills would be negligible. Caver said he primarily encounters buyers who look at La Plata County’s tax rate as a bargain compared to its neighboring counties.

That said, utterance of the words “tax increase” inflames voters. Some say the county in the past coasted on natural gas revenues, once accounting for nearly 80 percent of La Plata County’s revenue, with no long-term plan to compensate for the current shortfall. Revenue from property taxes dropped almost 50 percent between 2010 and 2014, from about $30 million to $15 million. Road and bridge infrastructure and maintenance suffer the worst.

“In my experience being in public meetings, each commission has said in the past that we have to raise the property tax,” said La Plata County Commissioner Gwen Lachelt. “I think back when the natural gas boom started. The public kept saying, ‘You guys have got to plan for when it goes bust.’ We did save a lot in order to purchase county buildings, but we have been caught flat-footed with roads. They take a beating not just with the gas industry but with the expanding population.

“We could have done much better with focusing on road impact fees but that’s what we’re looking into now.”

If the levy passes, the resulting revenue could fund up to 83 percent of the county’s road and bridge needs. The revenue from the maximum 2.4 mill increase is projected to produce $5.3 million. Of that, La Plata County would allocate approximately $671,000 to each municipality, keeping $4.7 million for the county.

jpace@durangoherald.com

Jul 4, 2016
La Plata County Commissioners to vote on mill levy ballot item
Oct 16, 2015
Local issues dominate ballots


Reader Comments