Bills and ballot measures in the works in Colorado to address massive property tax hike
County assessors are sounding an alarm about what is shaping to be the biggest tax increase in Colorado history.
They say property taxes in the metro area will increase by 35% to 45% next year and in some parts of the state, it will jump by 60% 70%, generating upwards of $3.5 billion.
"We've never seen... I think, we could all agree... something this historic or unprecedented," said Keith Erffmeyer, Denver's Assessor.
Michael Fields, with the conservative-leaning Advance Colorado Institute, has been warning about the increase since voters repealed the Gallagher Amendment in 2020, which had essentially capped property tax increases.
"This is coming and it's coming quickly and people are about to get their new assessments that show that huge increase," Fields said.
In anticipation of the spike, legislators passed a bill last year providing $1 billion in relief. But the increase is beyond what anyone expected, in large part because assessments were done in June of 2022, when home prices were at a high point.
"Every two years, your house gets reassessed. So, this is going to happen again and again and again until our property taxes are as high as any state in the nation," Fields said.
He's working on a ballot measure to permanently cap property tax increases at 3%.
"This is something that we wish the legislature would take on and if they want to make it a 5% or 6% cap that's fine. What we can't have is 40 or 50% that we have right now," he said.
State Sen. Chris Hansen, who is working on a bill that would provide relief, says a cap isn't the answer.
"Might sound good at first blush... but just a flat cap on property tax leads to tons unintended consequences," he said.
Hansen says any solution needs to balance helping homeowners without hurting schools and local governments that rely on property taxes.
"And we're going to do our best to really look hard at the data and come up with a package that balances those two imperatives," he said.
Fields says he's not opposed to a 3% to 6% increase in property taxes to help local governments but he says they don't need an increase 40% to 50%.
"We care about education and fire and all these different entities that are funded by property taxes, but it has to be a reasonable amount of increase each year," Fields said.
Hansen says he isn't sure the legislature will be able to pass a bill before the session ends May 8. He says they may need to come back for a special session.
The legislature set aside about $200 million in the budget for property tax relief, but Fields says that's not enough when the increase will be more than $3.5 billion.
He says unless the legislature enacts its own permanent cap on increases, he will bring a ballot measure.
The Bell Policy Center is working on initiatives in case voters approve a cap on property tax increases. The competing measures would backfill any lost revenue to local governments and schools with TABOR refunds.
It is unlikely the measures will make this year's ballot and unless the legislature acts, the new property tax increases will take effect in January.
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