Property tax increases in Eagle County are unlikely to match this year’s rise in values

This year’s jump in county-assessed property values has residents around the state asking, “Are my property taxes going to go up that much?” The short answer is “probably not.”

The Vail Valley Partnership Wednesday hosted a property tax forum at the Eagle County Administration Building in Eagle. The forum brought together representatives from several of the county’s numerous taxing districts to talk about what may or may not happen.

The county’s more than 70 taxing districts won’t set mill levies — essentially the property tax rate — until December. That state-mandated action may be extended if state voters in December pass Proposition HH, a ballot issue proposed by the Colorado Legislature that’s intended to rein in the tax implications of soaring property values.

Edwards-based accounting firm Marchetti and Weaver handles business for many of the valley’s special districts. Firm co-owner Ken Marchetti told the group that most of those districts are currently preparing two proposed budgets, one each based on the success or failure of Proposition HH.

No matter the fate of the ballot issue, increases may be slowed by a workaround to 1992’s Colorado Taxpayers Bill of Rights amendment to the state constitution. That amendment limits tax and spending increases without voter approval. Voters in many districts around the state have exempted themselves from revenue collected in excess of the amendment’s limits. But districts can’t simply drop their mill levies in years like this one. Voters must be asked to raise mill levies if there’s a drop in property values that affects revenues.

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The workaround is called a mill levy credit. That tactic allows districts to structure mill levy decreases as temporary credits to taxpayers for a specific budget year. Those credits are imposed before taxes are due. Districts can issue those credits in multiple years.

Districts are already planning for that scenario. Matt Gianneschi of Colorado Mountain College told the audience — a few dozen people in person — that the college has a written policy to not increase revenue more than the rate of inflation.

Gianneschi noted that staff and the Colorado Mountain College Board of Trustees in June discussed issuing credits. The current plan he added, is to budget for 2022 revenue plus 5.7%.

The Eagle River Fire Protection District also has a policy of holding down budget increases. Chief Karl Bauer said the district has promised taxpayers to hold revenue to that collected in 2010, plus district growth and inflation. Bauer noted that the district has twice recently withdrawn ballot proposals.

Marchetti & Weaver partner John Erickson told the audience that several districts, including the EagleVail, Beaver Creek and Berry Creek metro districts, have similar policies or voter-imposed revenue limits.

“Taxes are highly unlikely to match value (increases),” said Vail Valley Partnership CEO and President Chris Romer. “Most local governments are being responsible stewards.”

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The Eagle County School District — which, along with other districts in the county, accounts for about 40% of every property tax dollar —  is the exception to these fiscal policies, primarily due to the way the district receives funding from the state. Sandra Farrell, the district’s chief operating officer and director of finance, told the group this year’s value increase is “not a windfall” for the district, noting that local property tax increases decrease funding from the state.

The district this fall is asking voters a pair of questions, a $100 million bond issue and a “mill levy override” allowing the district to raise its mill levy.