6 MAY 18-24, 2023 westword.com WESTWORD | MUSIC | CAFE | CULTURE | NIGHT+DAY | NEWS | LETTERS | CONTENTS | Restraining Order THANKS TO TABOR, SOME COLORADO COUNTIES WON’T REAP THE BENEFITS OF SKYROCKETING HOME VALUES. BY C HRIS PEREZ Property values across the state have sky- rocketed, prompting counties and munici- palities that aren’t restricted by Colorado’s Taxpayer Bill of Rights to lick their chops at the prospect of collecting more taxes this year. But what about the places that aren’t exempt from TABOR? In Arapahoe County and Jefferson County, for instance, property values may be going up at an unprecedented rate — with median residential increases reported at 36.5 percent and 42 percent, respectively — but the amount of tax money that the counties get to spend is capped because of TABOR, the constitutional amendment pushed by real estate investor and California import Douglas Bruce that was designed to limit the revenue that the state and local govern- ments can retain and was passed by Colorado voters in 1992. Meanwhile, offi cials in places like Denver County, Douglas County and other counties that have become exempt from TABOR limitations through voter approval can reap the unrestricted benefi ts of the high assess- ments, without having to refund taxpayers. “Arapahoe County is almost entirely reliant on property taxes for providing all services — everything from repairing county roads to protecting the most vulnerable residents and providing public safety and motor vehicle services,” says Anders Nelson, spokesperson for the county commissioners’ offi ce. “Even as property values rise, the por- tion the county receives is still not keeping pace to support essential services at a rate consistent with growth. The county will consider various options to address fund- ing challenges to maintain and enhance the quality of life for its residents.” Over the past three decades, TABOR has been one of the state’s most controversial constitutional amendments, especially in the eyes of politicians and offi cials. “I don’t like TABOR,” offers Jefferson County Assessor Scot Kersgaard. “It artifi cially limits — and as I’m saying this, I can see how people like it — how much we can collect in taxes and what we can do with those taxes,” Kersgaard says. “My offi ce is underfunded; we need more people, we need to pay better salaries. Other counties pay a lot better than we do for similar jobs. ... And so I feel like my hands are tied a little bit.” Since TABOR passed, the major- ity of municipalities and counties in Colorado have become at least partially exempt from its provisions through a process known as “de- Brucing” — receiving voter approval to retain and spend “excess revenues above the TABOR limits,” according to Colorado Counties, Inc. As a result, these local govern- ments do not need to abide by the same TABOR rules that places such as Arapahoe and Jefferson coun- ties are held to, which also means they don’t need to issue TABOR refunds and can just hold on to any extra money that comes in over the TABOR revenue limit. To put this in perspective, in 2021 Jefferson County collected $17.3 mil- lion in revenue over the TABOR limits, and offi cials were forced to refund the overage to property tax- payers — 213,000 of them, to be exact, according to a September announcement. If Jeffco had de-Bruced, it would have been able to keep and spend that money. In order to determine the actual property taxes in Colorado, the statewide assessment rate is multiplied by whatever property value is calculated by the county assessor. The result then gets multiplied again by the local mill levy rate, with mills being $1 payments on every $1,000 of assessed value. Here’s how Investopeedia’s Chris Sea- bury describes it: “Suppose the total assessed property value in a county is $100 million, and the county decides it needs $1 million in tax revenues to run its necessary operations. The mill levy would be $1 million divided by $100 million, which equals 1%.” In response to this year’s record assess- ments — which could lead to record property taxes — on the last day of the 2023 legisla- tive session Colorado lawmakers approved House Bill 23-1311, which calls for putting a property tax relief measure dubbed Proposi- tion HH on the November ballot. If passed by voters, it could help alleviate some of the tax pain for homeowners while also leading to smaller or bigger TABOR refunds for certain people, depending on their income. If the measure is approved, the state’s TABOR refund pool would shrink by around $167 million, according to legislators, but property tax rates would be reduced, too. The state would be allowed to retain and spend revenues that would normally have been given back to residents as TABOR refunds. Prop HH would also allocate some of the excess to local governments as a way to make up for tax revenues lost to the property tax cuts. However, much like TABOR, it would still create a limit on the amount of property tax revenue that counties and municipali- ties take in. Eighty-fi ve percent of Colorado’s munici- palities and 51 of the state’s 64 counties have de-Bruced, according to the Denver Post. Douglas County Assessor Toby Damisch points out that having so many places around the state that are not restricted by TABOR is a huge problem for the counties and mu- nicipalities that are, since the non-restricted governments often take a much more lacka- daisical approach to legislative changes that would reduce taxes for residents. As a result, people living in places like Jefferson and Arapahoe counties could get hit with higher taxes this year, while their county governments don’t benefi t from those higher taxes whatsoever. “If you look at all the taxing entities across the State of Colorado, of which there are thousands, most of them are not TABOR- restricted,” Damisch says. “Most of them have de-Bruced, and that includes most of the taxing entities in Douglas County. And that is actually causing part of the problem this year. Because those taxing entities have exempted themselves from TABOR, they can accept the additional revenue that is caused by these property value increases. And so for most residents of most counties throughout the state, they are facing pos- sible tax increases that are matching their valuation increases, as TABOR does not, in fact, protect them.” For example, he notes, Castle Rock is TABOR-restricted and required to automati- cally reduce its mill levy and return any extra money to taxpayers, whereas other entities in Douglas County — such as the schools, Douglas County government and the Doug- las County Library — are not forced to do so because they have de-Bruced. “So it’s an issue for Arapahoe County government and Jefferson County govern- ment and other governments that are not de-Bruced,” Damisch explains. “They don’t get to take advantage of what’s happening.” Denver voters passed a de-Brucing mea- sure in 2012. Before that, city government had been “struggling to maintain economic growth,” and it was “becoming diffi cult for Denver to maintain its public services,” re- ported University of Colorado researchers in 2015, citing an interview they’d conducted with then-Denver Chief Financial Offi cer Cary Kennedy that was part of a TABOR study published online by the Colorado Municipal League. CML is a nonprofi t group that “represents the interests of 270 cities and towns” across the state, according to its website. “Libraries were forced to cut back hours, the road repaving schedule was delayed, parks were falling into disrepair from a lack of maintenance, and children who were on public subsidies were put on waitlists,” the report continued. “Ultimately, TABOR was preventing Denver from keeping up with real growth in the economy.” Now, Arapahoe County offi cials say they are in the same situation. According to the county’s 2023 budget re- port, there are currently nine school districts, thirteen cities and towns, and 460 local and service districts within the county, but only 13 percent of the property taxes collected from those entities by the Arapahoe Country treasurer go to the county itself. The remaining 87 percent is sent to the more than 420 spe- NEWS continued on page 8 KEEP UP ON DENVER NEWS AT WESTWORD.COM/NEWS County assessors gathered at the Denver City & County Building last month to share the historic assessments. CHRIS PEREZ
