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As regular as elk migrations and snow melt, the real property valuations handed down by Colorado county assessors every two years are typically controversial.
This year is no different.
There’s no question the value of mountain properties has gone up, up and up during the past decade — wealth generation if you will. But the new-found wealth is not exactly real, existing only on paper. It is only realized if and when property is sold. Quite real is that higher values and higher assessments translate into higher property tax bills for individuals regardless of whether they have more money with which to pay an increased tax bill. The assessed value of property is based on historic data. In other words, the assessments individuals received this spring were based on transactions when the real estate economy was booming.
That makes for a double-whammy: Assessed values based on the boom years but the taxes must be paid during the present down year.
County and state officials point out that rules are rules and say their hands are tied. The school district — the largest beneficiary of property tax dollars by far — cites similar state regulations governing the mil levies that fund education. Most other taxing entities — from metro districts and sewer authorities to towns and counties — will point to population growth, expected levels of service and the tough time they’d have reversing any decision to lower a mil levy.
Every taxing entity, so it seems, has a valid argument defending their position — so what to do?
Because the rules about valuation periods seem to be at the root of the overall problem, perhaps it’s time to take chisels and jackhammers to what officials seem to believe is set in stone. Surely in this age of electronic information gathering, county assessors can tweak the model so that valuations are more up to date and reflective of the current market. That 5,000 Summit County property owners are appealing their valuation (and nearly 6,000 in Eagle County) strongly points toward the need for reform. Perhaps a summit of the state’s assessors is in order — an opportunity to compare notes and ask two simple questions: Is Colorado’s current system of property valuation fair? If not, how can we make it fair? Their answers would be the first step toward directing the Legislature to make what are clearly needed changes.
Taxpayers should not accept shoulder shrugging and explanations that the rules cannot be changed when it’s clear the rules do not reflect the economic reality of the times.
This year is no different.
There’s no question the value of mountain properties has gone up, up and up during the past decade — wealth generation if you will. But the new-found wealth is not exactly real, existing only on paper. It is only realized if and when property is sold. Quite real is that higher values and higher assessments translate into higher property tax bills for individuals regardless of whether they have more money with which to pay an increased tax bill. The assessed value of property is based on historic data. In other words, the assessments individuals received this spring were based on transactions when the real estate economy was booming.
That makes for a double-whammy: Assessed values based on the boom years but the taxes must be paid during the present down year.
County and state officials point out that rules are rules and say their hands are tied. The school district — the largest beneficiary of property tax dollars by far — cites similar state regulations governing the mil levies that fund education. Most other taxing entities — from metro districts and sewer authorities to towns and counties — will point to population growth, expected levels of service and the tough time they’d have reversing any decision to lower a mil levy.
Every taxing entity, so it seems, has a valid argument defending their position — so what to do?
Because the rules about valuation periods seem to be at the root of the overall problem, perhaps it’s time to take chisels and jackhammers to what officials seem to believe is set in stone. Surely in this age of electronic information gathering, county assessors can tweak the model so that valuations are more up to date and reflective of the current market. That 5,000 Summit County property owners are appealing their valuation (and nearly 6,000 in Eagle County) strongly points toward the need for reform. Perhaps a summit of the state’s assessors is in order — an opportunity to compare notes and ask two simple questions: Is Colorado’s current system of property valuation fair? If not, how can we make it fair? Their answers would be the first step toward directing the Legislature to make what are clearly needed changes.
Taxpayers should not accept shoulder shrugging and explanations that the rules cannot be changed when it’s clear the rules do not reflect the economic reality of the times.
