The sticker shock experienced by property owners last May as they opened their Notice of Valuation is about to manifest in the form of their 2023 property tax bill. County treasurers will begin mailing tax bills around the first of February that reflect the 42% average increase in Colorado property values between January 1, 2021 and June 30, 2022.
It抖阴ap important to recognize that property value is only one of the components of the property tax calculation, with the other two being assessment rates (established by the state legislature) and total mill levy (established by local government service providers). This property tax crisis will affect the wallets of all Coloradans and is an important matter for citizens to understand.
Upon my arrival at the state Capitol in January 2023 as the representative for House District 45, it was clear to me that the impending property tax crisis demanded immediate attention. With eight years as the Douglas County Assessor and a total of 25 years working in that office, it was evident, given the erratic housing market and skyrocketing median home prices in the state, that massive tax increases were on the horizon.
Despite expectations of higher property taxes, the legislature and governor have repeatedly failed to provide a meaningful relief plan. held that property owners secure tax relief in exchange for their TABOR refunds, but Coloradans resoundingly rejected this proposition last November. Despite the lack of public support, this measure was repackaged during November鈥檚 special legislative session and pushed through. Once again, Colorado property owners were left without significant property tax relief.
The special session created the to develop sustainable property tax policy changes for our state. The commission is comprised of a group of individuals who bring relevant expertise: County commissioners, legislators, and representatives from school districts, fire protection districts, special districts, the business community and more.聽 Rep. Mike Lynch recognized my expertise in property tax issues and asked me to serve on the commission.
The commission will provide a preliminary recommendation to the legislature by March 15, and I鈥檓 optimistic about our ability to produce a long-term property tax solution for the citizens of Colorado. As a former assessor, I believe it抖阴ap critical that we consider valuation and assessment methods that are transparent, stable, and uncomplicated. Equally important in this policy conversation are balancing citizen needs, appropriate funding for local government services, school funding, differences between the urban and rural areas of the state, unique challenges of our resort communities, and other factors.
There are several ways to avoid significant tax increases, such as property valuation caps, property tax caps, and local government revenue limitations.聽 There are also methodologies where values or taxes are averaged or 鈥渟moothed鈥� so that abrupt changes in the real estate market don鈥檛 translate directly to a tax hike of the same magnitude. All of these are widely used around the country.
Our very own Taxpayer鈥檚 Bill of Rights (TABOR) placed a cap on the growth of government revenue — until someone had the bright idea to use an exception mechanism as a loophole. California鈥檚 Proposition 13 is an example of capping assessed value, and while it has brought significant issues with school funding, this proposition could provide insights for a more transparent and understandable method for taxpayers. Our governor advocates a land value tax system, which is neither commonly used, transparent, or easy to comprehend but is endorsed by ivory tower economists.
Several ballot initiatives are being teed up for this November. Colorado Concern, an influential business group, has introduced its own initiative aligned with California鈥檚 Prop 13. While this would be a win for property owners, it could result in local governments being unable to fund their community services. Michael Fields鈥� requires voter approval if the statewide property tax revenue is projected to increase by more than 4% over the preceding year. In such cases, government entities would need voter approval to retain the additional revenue.
The Commission on Property Tax is committed to finding a solution that will give Coloradans the relief they need and introduce measures to prevent future property tax crises. However, Coloradans need to make their voices heard. I encourage all citizens to attend the community conversations that will be held across Colorado and testify on property tax bills in House and Senate committees. I am optimistic that through collaborative efforts, we can forge a well-structured proposal that aligns the diverse needs of citizens with those local government entities that serve our communities.
Lisa Frizzell is a Republican from Castle Rock, Colorado and represents District 45 in the Colorado House of Representatives. She served as the Douglas County Assessor since 1998 and serves on the Commission on Property Tax for the Colorado Legislature.
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