La Plata County residents who received notices of valuation informing them of marked increases in their property’s value have expressed vocal discontent over their growing tax burden.
But more objectionable, they say, would be if taxing entities receive a surge in revenue.
“I do have a problem with the thought of governments, La Plata (County) for example, getting a 50 or 60 or more percentage increase in their income because everybody’s (assessed value) has gone up,” said Bill Fisher, whose Edgemont Ranch home increased in assessed value by 46% from 2021.
Another property and business owner called the increase “blatant robbery.”
Across the county, the median property value increased by 20%.
Property taxes in La Plata County remain among the lowest in the nation – the county’s tax rate, which has not changed since the 1980s, is just 8.5 mills, or $8.50 per $1,000 of assessed value.
Property values are just one piece of the equation to determine the owner’s tax burden. The total assessed value, any credits on the value, the assessment rate and the mill levy all factor into that equation.
The total value is determined by the county assessor based upon sales. Credits on that value are determined by the state Legislator, as is the assessment rate. Voters have direct power to approve or disapprove any changes in the mill levy.
Agricultural land – which is taxed at 26.4% – did not see the same increase.
Agricultural land is assessed on its production, balancing its output with its costs. While some farmlands with low water needs increased in value, land that demands heavy sprinkler use decreased in value. Overall, the value of agricultural land decreased by roughly 10%, said La Plata County Assessor Carrie Woodson.
A surge in home purchases in the region has some residents questioning if taxing entities will see a windfall of new revenue.
But just the opposite is likely to be true, according to some public officials. La Plata County government faces a net decline in revenue next year as a result of certain laws and inflation.
Of the county’s revenue streams, property taxes are among the largest, bringing in a projected $16 million in 2023.
A bill passed in the Colorado Legislature in 2022 dropped the assessment rate in 2023 from 7.15% to 6.765%. The state also issued a “credit” of $15,000 on a property’s total value.
The average home in La Plata County sold for $652,663 in 2021, meaning that the average homeowner paid $396.66 in county property taxes. That does not include mill levies paid to fire, school and other special districts that make up the total property tax bill.
But because of the state-issued credit and lower assessment rate, that home, now valued at 20% more than last year, would owe $441.73 in property taxes.
The increase reflects an 11% jump in the homeowner’s tax burden, while they enjoy an (unrealized) 20% increase in the value of their asset.
In the same period over which the average tax burden grew 11%, inflation in the state increased nearly 16%.
The county is viewing this as a net 5% loss in property tax revenue.
“There’s no windfall, that’s the bottom line,” said County Manager Chuck Stevens. “My labor costs, medical and dental care, the cost of asphalt, cost of (magnesium chloride de-icer) and everything else has gone up.”
Proposition HH, which will appear on the ballot this November, will ask voters if taxing entities should have the ability to offer temporary mill levy reductions.
The Taxpayer Bill of Rights, known as TABOR, prevents any taxing entity from raising rates without approval of voters. And if the county were to lower the mill levy, TABOR would restrict it from raising it without putting it to the voters.
Prop. HH would skirt TABOR by allowing the county to offer a temporary credit if desired, without needing voter approval to reinstate the original mill levy approved by voters.
Despite a dire need for road and bridge funding – which can only be sustainably supplied through a property tax increase – the county’s tax rate has not increased from 8.5 mills in four decades.
Although it’s too early to speculate what the county might do if the ballot measure passes, Stevens said the budget will be lean this year.
“We’re content to sit quietly and make due with what we got,” he said “We’ve been successful at doing that for many years, living within our means – that’s what we do and that’s what we plan on doing. This year’s budget is going to be ... a little tighter.”
rschafir@durangoherald.com
