Summit County property tax sticker shock
Summit County, Colorado
SUMMIT COUNTY, Colorado ” The latest round of property valuations by the Summit County assessors office has spurred a wave of appeals that’s running 170 percent ahead of the pace from two years ago.
So far, 800 people have contacted local officials to challenge the valuations, which could lead to higher taxes for property owners, according to assessor Beverly Breakstone.
After the 2007 re-appraisal, about 3,300 property owners challenged the county’s numbers, and Breakstone said she expects to surpass that number by May 31, the end of the current appeals period.
Summit County commissioners have been fielding calls from property owners who are wondering how their property could have appreciated so greatly during a recession. As a result, they met with the assessor last week to discuss the issue.
In neighboring Eagle County, the commissioners have discussed the possibility of lowering mill levies, but Summit County commissioners don’t appear to be moving in that direction.
But the county might consider a rebate at some point.
“If we’re faced with a choice between dropping the mill levy or a rebate, we’d definitely look at the rebate,” said County Commissioner Bob French.
Such a rebate could become mandatory for the county under state tax laws that limit revenue growth, French said. A rebate would not come as a cash payment but probably in the form of credit against future taxes, French explained.
“Rebates are complicated. Staff has to do a lot of research before we say if we can do that,” County Commissioner Thomas Davidson said.
The valuations by the assessor are only the first step in determining the tax amount. Later this year, 34 taxing entities in the county will look at county’s valuation figures when they hold budget meetings, and then determine the mill levies.
Those districts could theoretically lower their mill levies, but it could leave them in a pinch in future years, said county treasurer Bill Wallace.
“There’s no leeway in TABOR to drop mill levies and then raise them again without going to a vote,” Wallace said, referring to Colorado’s revenue-limiting “taxpayer bill of rights” approved by voters in 1992.
Abiding by another state law that caps revenue growth at 5.5 percent annually, the county has actually reduced its mill levy rate the past few years to stay under the cap, Davidson added.
Silverthorne resident Sharon Taylor said she will ask the county to take another look at the valuation of her single-family home, which she bought five years ago for $322,000. During that span, her annual property taxes have climbed $700. The county’s most recent valuation notice tabbed her Eagles Nest home with a value of $466,000.
“They’re pricing us out of here,” Taylor said. She thinks her house is worth about $400,000, based on the sales price of similar homes in her subdivision near The Raven golf course.
She said the homes in her neighborhood don’t sell very often. One transaction used as a comparable value was for a house directly adjacent to the golf course, while Taylor’s sits back a ways from the links. That should make a difference in the valuation, Taylor said.
Similarly, Louisville resident Jeff Nelson, who owns a second home near Breckenridge , wrote in an e-mail that he was “shocked” to see that the county valued his property 30 percent higher than two years ago.
“I realize property taxes are based on looking at past real estate transactions and not what the current market conditions are, but it seems to me that in these economic times this is a windfall for Summit County,” Nelson wrote.
Nelson said he will appeal the valuation, based on the fact that the comparable sales used in his case were for houses near the golf course.
Frisco real estate agent Butch Elich hosted a meeting last week to help educate property owners about the issue. Elich said about 15 people showed up. Most of them expressed concern about the “huge” percentage increases, he said.
“That raises the question of whether they under-valued last time,” Elich said.
Elich said the way the county calculates the valuations in Frisco opens the door for “tremendous inequities” between properties that have been remodeled and upgraded and older properties, sometimes in adjoining duplex units.
Elich acknowledged the county doesn’t hold all the cards in the property tax game. Only 22 percent of the collected property tax goes to county coffers. The rest goes to the local school district, fire departments and other special districts.
“I think those taxing entities need to make changes just like the rest of us,” Elich said.
Commissioner French said he hasn’t personally heard a lot of complaints from taxpayers. The gripes are natural during a tough economy ” especially when people get a chance to blame the assessor, county government or the State Legislature, he said.
But he also said that nearly everyone who bought real estate in Summit County did so with the expectation that its value would increase.
“It was guaranteed cash machine … Now that it’s turned a bit, people are bitching. They just don’t want to pay more money. It’s not because they’re mean. It’s so complicated they just don’t understand,” he said.
Elich also acknowledged that people bought property in Summit County with the expectation that it would increase in value.
“I think that when people are paying their taxes they want the best deal they can get. And when they’re selling their house, they also want the best deal they can get. It’s human nature,” he said.
When times are hard and people have lost money in the stock market, every last dime becomes a bone of contention, Elich said.
Some of the complaints are simply based on a lack of accurate information, said commissioner Karn Stiegelmeier.
“Our biggest question was, why are everybody’s taxes going up?” Stiegelmeier said. The answer from the assessor was that the preliminary figures are just a “rough guess-timate” at this point, according to Stiegelmeier.
Stiegelmeier said she is concerned that, because of state laws, owners of vacant land and commercial properties in Summit County will bear the brunt of the tax burden.
“They’ll be the hardest hit, and this is a bad time to up taxes on commercial. We really have to look at the impacts to local businesses. The last thing we want is to have an economic disincentive package,” Stiegelmeier said.
Local property taxes also need to be seen in a wider context. Breakstone said she’s preparing a comparative analysis showing how Summit taxes stack up against other jurisdictions, and she expects the study will show that local rates are lower than in adjacent Eagle County, and lower than many other jurisdictions in the state, especially along the Front Range.
Final tax bills won’t be determined until the boards of the various special districts and taxing entities hold their budget meetings later in the year.
Breakstone has been meeting with groups of property owners and providing information on how to appeal the valuations. She said that generalized complaints don’t really help very much. Specific information from property owners as to why they think the valuation is incorrect is more helpful.
The process and timing for determining property values is set by state law. The assessor uses information from comparable sales during a specific period to determined the taxable value of properties.
“It’s not really helpful to us if it’s personal,” Breakstone said. “If people say, ‘I drove by all my comps and they’re not really the same,’ then that gives us something to work with,” she said, acknowledging that process of using mass appraisals can lead to errors.
French said the county has already tightened its budget belt, and that further cuts could lead to reductions in services that residents demand.
Commissioner Thomas Davidson said the county’s share of the property tax is only about 22 percent. Of that amount, 30 percent are voter-approved taxes for open space and affordable housing, for example.
The rest of the taxes ” 78 percent ” are levied by a variety of special districts, including local schools, Colorado Mountain College and fire protection districts. Those amounts are based on the budget decisions of those other taxing entities, Davidson said.
Breakstone said citizens can attend the late summer meetings of those entities and voice concerns about tax rates.
Bob Berwyn can be reached at (970) 331-5996, or at email@example.com.