In the wake of Proposition HH’s rejection at the ballot box, state lawmakers passed a short-term property tax relief package during the recent special legislative session, but Gov. Jared Polis is asking local governments to play a role in lowering tax bills.

On Nov. 20, the state passed a bill to lessen the impact of rising property taxes on Coloradans by reducing the assessment rate to 6.7% and subtracting the first $55,000 in a primary home’s value. Now, where possible, Polis is urging taxing districts to drop mill levies – something he says they can now do without risking the notorious “ratchet-down effect” of yesteryear. If valuations dip or flatten out, districts can float their mills back upward.

“It’s up to our local elected officials to reach that balance” between affordability and each taxing entity’s core functions, Polis said at Colorado Mountain College in Breckenridge on Thursday.

We noted that Prop HH’s failure would likely result in more discretion for local taxing districts. Prop HH called for using surplus state TABOR revenue to backfill all local governments for a 10-year drop in the state’s assessment rate and an increase in the exemption. Voters were clear that they didn’t want any alteration of the current TABOR formula.

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But unlike HH, the stop-gap legislative bill that passed did not include a provision to backfill all budgets – only school districts and certain special districts, such as fire and ambulance services. So now elected officials have to decide if they can get by on less than what they’re entitled to by adjusting mill levies downward.

Reaction has been interesting to say the least. On one hand, circumstances have dictated local control and local solutions – generally considered an improvement over the Legislature’s propensity for statewide solutions. But some critics feel any burden on local governments due to a failure to provide permanent and equitable property tax relief is unfair.

Mesa County Commissioners are no strangers to dealing with the prospect of excess revenues under TABOR. Last year, for example, the county issued refunds to taxpayers through direct checks to all registered voters in the county. It did that because most of the excess stemmed from sales tax.

This year, higher valuations are expected to provide the lion’s share of excess revenue, so a reduction in mills is a possibility.

“We are looking at all our options to save our residents the maximum amount of money possible, and lowering the mill levy will be considered,” said Commissioner Bobbie Daniel.

That, in our estimation, is an appropriate local solution.

But Polis has asked school districts to consider lowering mills for non-instructional bonds or mill levy overrides since the property tax relief bill backfills school districts and the proposed budget increases per-pupil funding. His proposal drew a quick and critical response from District 51 Board of Education President Andrea Haitz.

“The notion that such reductions won’t affect teacher pay or classroom instruction is optimistic at best. The intricacies of budgeting for school districts are far more complex, and your proposal oversimplifies the potential consequences. It’s disingenuous to assume that the suggested cuts won’t have a ripple effect on the overall quality of education and the well-being of educators,” she wrote to the governor.

Considering that D51’s per-pupil funding will still rank 174 out of 178 districts in Colorado, we think Haitz makes a strong point.

Meanwhile, pressure mounts for the bipartisan Property Tax Task Force established during the special session to devise long-term, locally driven solutions to property taxation in Colorado.

Grand Junction Daily Sentinel Editorial Board

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