Property assessments may have dropped in Denver for most residents, but roughly two-thirds of homeowners can expect to see their property taxes increase next year.
Not by much.
For the owner of a $230,000 home — the median in Denver — that tax will jump only $30 next year.
The increase is due to the state-mandated Taxpayer’s Bill of Rights, commonly known as TABOR. And the increase still must be approved by the City Council.
Denver County, unlike many others in the state, never opted out of revenue limits imposed under TABOR for property tax, a process known as “de-Brucing,” a reference to Douglas Bruce, TABOR’s author.
Instead, the county gave homeowners a tax credit in lieu of collecting all the taxes it could.
“This year because we have seen assessed values drop during this economy, that credit goes away under TABOR,” said Cary Kennedy, Denver’s chief financial officer. “There aren’t surpluses. The credit goes away, and the mill levy floats up.”
In effect, the decline in assessed valuation means the “mills” must rise next year to cover the authorized dollars.
One mill is one tax dollar for every $1,000 in assessed value.
Not everyone will see the increase, Kennedy said.
“For some people, the value (of their home) will drop so much that even though that credit goes away and they have $30 more to pay, their overall tax bills are still going down because their property values have gone down by more,” she said.
In December the City Council will set the mill levy, which it does every year. It is un likely that the council will allow the city to continue to hand back a credit. Even tax-adverse council member Jeanne Faatz said she wouldn’t vote to do that.
“You either de-Bruce or you support TABOR,” Faatz said. “I support it.”
If the council doesn’t let the credit go away, the city will have to make up $9 million of lost revenue in the 2012 budget permanently, said Ed Scholz, deputy finance director.
“That $9 million goes away forever,” Scholz said. “I want people to understand that it is not a one-year issue. It is permanent.”
In total, 70 percent of Denver property owners saw their values decline in the last reassessment.
About 102,000 homeowners — or 62 percent — will see higher property taxes from the city.
Denver County has among the lowest property taxes in the metro area, second behind Englewood in 2011, according to Scholz.
Denver property owners also pay property taxes for schools. About 60 percent of a Denver homeowner’s property tax bill is for Denver Public Schools, which district officials say are some of the lowest in the Front Range.
On the median-priced $229,800 home in Denver, homeowners in 2011 were taxed $476.38 for the city’s portion, $10.55 for an urban drainage tax and $731.17 for DPS’s portion.
The total bill was $1,218.10
Total mills for DPS this past year were 39.972, compared with 70.359 for Adams 12, 55.389 for Littleton, 53.919 for Aurora, 50.497 for Cherry Creek, 48.210 for Jefferson County and 43.838 for Boulder Valley, according to DPS.
Jeremy P. Meyer: 303-954-1367 or jpmeyer@denverpost.com
