Another year, another special session on property taxes. Countering the rise in property values, Colorado’s legislature has delivered multiple tax cuts in bills going back to 2021. Earlier this year SB24-233 provided significant reductions, but as with all across-the-board cuts, the lion’s share went to those with the most valuable properties. As noted by the non-partisan Legislative Council, the owner of a $50,000 property will see just $241 in savings over the next three years, compared to $1,871 for a property valued at $2 million.

Property tax cuts come at a great cost, restricting the ability of local governments to fund essential services, including fire, parks, human services, housing and education. SB24-233 went further than previous legislation and limited the amount of property tax revenue local governments (school districts excluded) could collect in future years. The Legislative Council estimated local governments would lose $436 million in revenue in 2024, with similar losses in years to come.

In their demographic note for SB24-233, the Legislative Council noted: “To the extent these tax cuts are not passed on to renters, the increase in after-tax income for homeowners is expected to increase economic disparities by race, ethnicity, disability status, and socioeconomic status in the short term.”

Stay up to speed: Sign up for daily opinion in your inbox Monday-Friday

Given Colorado’s nationally-low property tax rates, we question what issue legislators and Gov. Jared Polis are trying to solve during this session, and more importantly, to whom they are trying to provide “relief.” No data has been offered about which property owners are hurting from the rise in home values, or even whether property tax reductions are the right avenue for relief.

The latest cuts now headed to the governor’s desk go even further than SB24-233, yet there has been little discussion about who will benefit most, let alone the impacts on local governments.

Who is most in need of assistance? This is a question anti-poverty advocates must answer every day as we fight to ensure struggling households have the resources they need to make ends meet. In making the case to policymakers, we turn to data and research, seeking solutions that truly improve economic security for Coloradans.

What does the data show us? Property taxes paid by homeowners, both with and without a mortgage, have been falling as a share of home values over the past 10 years.

• In 2012, the median property tax paid by homeowners with a mortgage was 0.64% of the median home value that year, compared to 0.46% in 2022.
• In 2022, the median property tax paid by a homeowner with a mortgage represented 2.1% of the median household income; 2.7% for homeowners without a mortgage.

Property taxes are only one expense facing homeowners, accounting for 10% of annual housing-related expenditures in 2022. Still, even when we consider all the expenses facing homeowners, we see homeowners tend to be much more economically secure than renters.

• Looking at households with incomes less than $30,000 in 2022, we see the median renter ended up with $240 of their monthly income remaining after subtracting housing costs, compared to $544 for homeowners.
• For households with incomes between $30,000 and $74,999, the median homeowner had more than $3,000 remaining to spend on other essentials, compared to $2,665 for the median renter.

Colorado’s high cost of living affects homeowners and renters alike, but by enacting blunt property tax cuts, our elected officials favor those who are least affected by the rise in home values, at the expense of everyone else. It is frustrating to see a lack of attention to solutions that would target low-income homeowners, or to solutions that would protect Coloradans who are priced out of the market and who would be harmed the most by reductions in county funding.

There is a role for government to play in keeping struggling families in their homes — whether rented or owned — but the tax cuts about to be signed into law are not the answer.

Charles Brennan is the income and housing policy director at Colorado Center on Law and Policy, a non-partisan, nonprofit advocacy organization fighting poverty through research, legislation and legal advocacy.