Columnists, Jon Caldara, Politics, Taxes

Caldara: State board slams door on local property tax relief

(You can listen to this column, read by the author, here.)

While the world is consumed with the latest bit of activism from the Colorado Supreme Court regarding Donald Trump, the media oxygen has been squeezed away from another important ruling, one that’s going to hit property owners.

The Colorado State Board of Equalization has decided counties cannot provide property tax relief by lowering property values.

Thanks to the weird way Colorado funds education, the State Board of Equalization has a fundamental conflict of interest, which will always injure taxpayers.

Board of Equalization, you ask? Yep, these five people are the ultimate arbiters of property valuation disputes.

You think the county assessor overvalued your home, your final appeal goes in front of these guys. And maybe they’ll treat you better than they treated the taxpayers of Douglas County.

The Douglas County commissioners voted to lower property values in their domain by a mere 4% to help alleviate the sticker shock that’s coming when their constituents get their next tax bills, saving homeowners about $230.

Property owners statewide are about to see the largest increase in their lives. Any property tax relief, like the symbolic silliness from the last special session, or what Douglas County wants to do here, only lowers the amount of a gargantuan increase.

The Colorado Board of Equalization slammed the door on Douglas County’s modest tax respite. To his credit, Gov. Jared Polis denounced the board’s decision!

What a shame Gov. Polis couldn’t appoint a majority of members to this board.

Oh, wait a second. He did.

Yet another fine example of how Polis plays Pontius Pilate by washing his hands of his own bad decisions. He has the power to influence, if not demand, and replace his appointees to this board.

When will Coloradans learn Polis can never be judged by his words but only by his actions?

So, why would the State Board of Equalization deny a county from lowering assessments? Quite simply, they have a massive conflict of interest between their members and their mission.

The board is comprised of five people, three chosen by the governor and one each chosen by the president of the Senate and the speaker of the House.

Lowering Douglas County assessed property values by 4% results in all of the local districts that rely on property taxes in the county receiving a little less of a massive tax increase. Except, not Douglas School District. Anything they don’t get from local taxpayers gets “backfilled” by the state.

And there’s the rub.

In their meeting denying Douglas County their request to reduce assessed property values, Board of Equalization member state Sen. Chris Hansen was completely honest. If he did his “Board of Equalization” role correctly and approved the change, he’d have a little less money to spend when he’s playing his “state senator” role.

So, here’s the deal:

Property values in Douglas County are up about 50%. That means the Douglas County school district is going to get about $100 million more from local taxpayers. And that means the state of Colorado won’t have to backfill $100 million to the school district.

That’s a $100 million windfall for Gov. Polis, Sen. Hansen and their friends at the Capitol to play with.

By Douglas County commissioners lowering property valuations by a mere 4%, it means instead of $100 million of property tax increases going to the school district, it would be about $92 million.

Sen. Hansen in a moment of embarrassing candor made it clear: Why have a $92 million winning lottery ticket when he could keep all the money and have a $100 million ticket?

What the Douglas County commissioners wanted wouldn’t cost the state anything.

It only lowers the amount of their eye-popping windfall by the state having to backfill the school district $8 million.

People use the word “greed,” mostly to insult people in the private sector. If this isn’t the ugliest type of greed, I don’t know what is.

If county commissioners don’t have the right to adjust assessed property values, the only chance for property tax relief comes from the local districts themselves. Local districts that rely on property tax revenue can, of course, reduce the mill levy themselves as a handful already have. But overwhelmingly most won’t.

If the media and chattering classes weren’t so captivated by the Trump drama, they might be demanding answers from Polis and the Board of Equalization about their mischief.

Jon Caldara is president of the Independence Institute, a free market think tank in Denver.


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