Colorado counties ask lawmakers for more funding to replace lost property tax revenue 

Democrats' bill is nearly identical to relief Proposition HH would have offered — but only applies to the 2023 tax year

The Colorado state Capitol in Denver is pictured, Monday, Jan. 9, 2023. Colorado lawmakers are drafting a sweeping ban on most semiautomatic firearms. If passed, the ambitious legislation would make Colorado the 10th state in the nation to ban the sale and transfer of certain semiautomatic guns, joining California’s ban from 1989 and Illinois’ ban signed into law just two weeks ago.
David Zalubowski/AP file

DENVER — Representatives from counties across Colorado complained during the first day of a special legislative session Friday that Democratic lawmakers’ plan to reduce property taxes would leave them strained to provide services. 

Those complaints came as Colorado Counties Incorporated, the nonprofit organization that represents counties across the state, voted to have a neutral position on Senate Bill 1, which Democrats introduced Friday. 

Representatives from the organization testified they support parts of the bill — such as financial support for school and fire districts — but they want to see more support for counties.

“Counties provide crucial services to people in Colorado,” said George Marlin, a Clear Creek þȾƷƵapp commissioner and a spokesman for the CCI board. “Our budgets are strained by increased costs at the same time as increased service demands”

Gov. Jared Polis announced the special session on Nov. 9, calling on lawmakers to find a one-year solution to historically high property taxes after voters soundly rejected Democrats’ initial plan: Proposition HH. Senate Bill 1 is Democrats’ attempt to find a new solution.

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The bill is nearly identical to the relief Proposition HH would have offered — but instead of lasting 10 years, it would only apply to the 2023 tax year. It also diverges from HH in that it wouldn’t use excess funding over the cap on government spending set by the Taxpayer’s Bill of Rights to pay counties back for the property taxes they would lose. That means it wouldn’t impact the TABOR refund checks Coloradans receive when the state government’s revenue exceeds the cap. 

Senate Bill 1 would cut the state’s assessment rate, which is used to calculate property taxes, to 6.7% from 6.765%. It would also allow homeowners to exempt the first $50,000 of their home’s value when paying taxes. 

Property taxes are collected by counties and used for local services like schools, fire departments, libraries and sheriff’s departments. That means Democrats’ plan to provide residents with relief will result in counties having less revenue to pay for those services. To make up for the losses, the bill proposes using the majority of a $200 million portion of general fund dollars to fully refund school and fire districts. 

About $65 million of that funding is set aside to make some local governments’ budgets whole. It prioritizes counties with slower growth in their homes’ assessment values.

“Summit þȾƷƵapp doesn’t qualify for any kind of backfill in the bill as it has been presented today,” said Summit þȾƷƵapp Commissioner Tamara Pogue. 

Pogue and other commissioners asked lawmakers to reconsider the backfill mechanism. Ultimately, the bill was approved along party lines without substantial changes made. It will continue through the legislative process over the weekend. 

Routt þȾƷƵapp Assessor Gary Peterson said his county also won’t be eligible for backfill. 

Counties must submit their finalized budgets to the state by early December. 

The session is expected to last at least three days and will cover several other topics. Bills to make all TABOR refunds equal, create a task force to study a long-term approach for keeping property taxes at bay and add funding for the state’s rental relief program all progressed in the first day of the session. 

Several Republican bills were postponed indefinitely during their committee hearings, including their own plans to address property tax increases and create a tax task force.

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