If we were starting from scratch, we’d never come up with a property tax system remotely like what we have in Colorado. Through a combination of things that we the people have done through voter approved constitutional amendments and provisions enacted by the legislature, our system has a variety of interconnected things that are littered with unintended consequences and questionable public policy impacts.
Property taxes are determined based upon what the property is worth, what it is used for and where it is located. Counties, schools and special districts depend primarily on property taxes, but the constitutional and statutory provisions that oversee operations are imposed at the state level.
The dysfunction began in 1982 with passage of the Gallagher Amendment, which fixed the percentage of total taxes to be paid by commercial and residential properties. When Gallagher was adopted, commercial taxes were roughly 28% higher than residential taxes. By 2020, they were more than 405% more. Passage of TABOR in 1992 further complicated things be limiting governments’ revenue and spending. Ironically, the provision in TABOR that allow restrictions to be waived by a vote of the people and how many local governments successfully “de-bruced” resulted in even more confusion.
A couple of significant changes happened more recently. As the difference between taxes on residential and commercial property was about to become even larger, the legislature referred an amendment to repeal the Gallagher Amendment, with the expectation that current tax percentages would remain in place, to voters in 2020. The repeal was approved. Last year, to undermine a citizen-initiated amendment to reduce property tax revenues, the legislature passed a bill that created more tax categories and lowered rates for 2022 and 2023. Both the reason for and result of the bill was flawed. Introducing legislation to undermine something upon which voters will be asked to weigh in is inappropriate and fuels skepticism. The 11th hour proposal has led to unintended confusion to an already confusing tax system.
Several initiatives related to property tax are in the process of trying to qualify for the ballot. It is likely that we’ll vote on multiple proposals concerning things people don’t like. That approach of nibbling around the edges, regardless of the intentions or specific elements of each proposal,is absolutely the wrong way to proceed.
To better prepare for the future and to get a fairer and more logical system, the legislature should ask voters for a waiver on single subject rules and create a commission with representatives of all parties impacted by property tax. That commission should gather input and provide a comprehensive overhaul for voters’ consideration.
Board elections for the Evergreen Fire Protection District, Evergreen Parks and Recreation District and Evergreen Metro District are scheduled for May 3. Each election is being run independently of the others, which will not help with our usually low voter turnout. Please learn about the candidates for each board and exercise your privilege and responsibility to vote in each election.
Greg Romberg had a long career in state and local government and in government relations. He represented corporate, government and trade association clients before federal, state and local governments. He lives in Evergreen with his wife, Laurie.