By SEN. DYLAN ROBERTS
Colorado Senate District 8
Last week, the Governor called the legislature back for a special session to address property taxes. After meeting for four days, we passed several bills that will help reduce the increase in property taxes and set up a process to find a bipartisan long-term solution to the rise in property taxes in Colorado.
Special sessions in Colorado are very rare — they have only occurred three times in the past seven years — and are confined solely to the specifics of the Governor’s “call.” This special session was called almost immediately following the failure of Proposition HH during the November 2023 election because the deadline to finalize metrics for everyone’s property tax bill is in early December.
Property taxes are fundamentally a local tax, as these tax collections go exclusively to local services. The schools we send our kids to, the fire and EMS departments that keep us safe, and the hospitals, libraries, parks and recreation districts, sanitation departments, water providers, and county governments we rely on (and often many others) all are primarily funded by property taxes.
Thus, any reduction to property tax revenue impacts these important and necessary local services. However, with the massive increase in housing prices — especially in mountain and rural communities like ours — homeowners are rightfully frustrated with the corresponding increase in property taxes that far outpaces inflation.
What Passed and What It Means For You
Despite some comments in the media, what was passed was not the same as Proposition HH. Most importantly, the bills do not decrease TABOR refunds for everyone as Proposition HH proposed (and in fact, they increase them for most Coloradans). Further, the bills apply only to the 2023 tax year while Proposition HH would have made changes that lasted for 10 years. Finally, while the property tax reduction bill we passed this special session does include backfill for local school districts, fire districts, ambulance districts and other local government entities, that is not paid for by any new TABOR surplus as Proposition HH proposed.
SB23B-001 – Property Tax Reductions for 2023 Tax Year
– Reduces the residential assessment rate to 6.7% (down from 6.765%) and increases the exemption on a home’s value from $15,000 to $55,000, which, when combined with savings from a 2022 bill that takes effect at the same time, the statewide average residential property tax bill for the 2023 tax year will be reduced by about $430 for a $300K home, $500 for a $500K home, and $700 for a $1m home.
– Provides 100% backfill (from existing state funds) to schools, fire districts, ambulance/EMS districts, and rural hospital districts, and a tiered backfill to other local districts based on local home value growth.
– Keeps the senior homestead and disabled veteran homestead exemption in place.
– Still allows local governments to reduce their mill levies to give further relief (see below).
HB23B-1003 – Property Tax Commission
– Creates a 19-person commission charged with meeting between December 2023 and March 2024 to make recommendations to the legislature on long-term policy changes regarding property taxes (i.e. a “replacement” to the Gallagher Amendment that was repealed by voters in 2020).
– Made up almost entirely of officials from local government, business, education and real estate. Democrats and Republicans will both have appointments.
HB23B-1001 – Emergency Rental Assistance
– Allocates an additional $30 million to provide financial assistance for Colorado renters to avoid evictions, pay landlords, and keep working individuals and families housed.
HB23B-1002 – Earned Income Tax Credit Expansion
– In 2023, Colorado will increase the state EITC from 25% to 50% to help low-to-middle income working families handle increased cost of living.
Finally, a bipartisan bill I co-sponsored during our regular 2023 session that could lower your property taxes even more is already law. While the state legislature can make changes regarding the assessment rate and provide some discounts on value like we just did, local taxing entities set taxing rates and have the power to reduce property taxes as well. Their work accounts for the increase in real estate values, particularly here in the mountains. SB23-108 empowers local taxing entities (special districts, counties, etc.) to temporarily lower their mills and give people property tax relief during these times of high valuations. We are hopeful that many local districts across the state will use this tool to add more relief to your property tax bill.
While not perfect, I believe the special session delivered responsible results that will alleviate some property tax burden for homeowners, help renters and working families, and protect important local services including schools, fire and EMS districts, and hospitals. Now, we must do more and find a long-term solution for the years ahead and I look forward to that work. As always, I welcome your feedback at [email protected] or cell: (970) 846-3054.
Dylan Roberts is the State Senator for Clear Creek, Eagle, Garfield, Gilpin, Grand, Jackson, Moffat, Rio Blanco, Routt, and Summit Counties.
