Eagle County residents need to be prepared for property tax sticker shock coming in 2024
Get ready for sticker shock.
Property in Colorado every two years is revalued by county assessors across the state. Those values are then used to determine the basis for property taxes. Given the runup in prices between 2020 and 2022, the increase is going to be a big one.
Eagle County Assessor Mark Chapin said the most recent re-assessment of values could show an average increase of perhaps 70% for residential properties.
County officials are working now to prepare for an avalanche of appeals of those values. Officials now are preparing for 2,500 appeals to the County Board of Equalization, a step beyond initial appeals.
Chapin said the expected Board of Equalization appeals is more than double the total number of appeals over the past few valuation cycles.
Those values affect more than 100 taxing entities across the county. Those entities in the Vail Valley include Eagle County Schools, which takes by far the largest share of a property tax dollar. Eagle County’s government, in contrast, takes about 13% of that dollar, since sales tax collections supply much of the county’s revenue. Most of the county’s towns take even less, thanks to sales taxes. Because of Red Cliff’s small sales tax base, residents there pay higher property taxes.
Other taxing entities are supported almost entirely by property taxes. Those entities include local fire districts — except Vail’s, which is an arm of the town’s government. Recreation and other districts are also supported almost entirely by property tax collections.
All those districts in December set their mill levies — their tax rates — in December, after they’ve passed their annual budgets.
A 70% increase?
So, is your property bill going up by 70% for taxes payable in 2024?
It’s too soon to tell.
First, news of the large increase in values is only starting to come to light.
Bob Armour chairs the Vail Recreation District Board of Directors.
“We haven’t even thought of it,” Armour said in a phone conversation, adding “We don’t have a clue” how to deal with the increase.
Darell Wegert, a member of the Eagle River Fire Protection District Board of Directors, said he hadn’t heard of the value jump.
That board recently approved a property tax increase proposal for the May ballot.
Local district boards may be hamstrung by Colorado’s tax- and spending-limiting constitutional amendment known as TABOR — the Taxpayers Bill of Rights.
That broad-ranging amendment limits the growth of local government by tying revenue increases to the Denver-Boulder consumer price index, and requiring voter approval of tax increases.
If a government or district collects more than the limits, that entity has to either refund the money or ask voters for approval to keep and use the money.
The ‘reverse ratchet’
Many governments and districts have earned voter approval to exceed those limits. That means, in theory, those entities could probably raise taxes.
The complication is another element of TABOR, which states that if taxing entities lower their mill levies, those tax rates can’t be raised without asking voters.
That’s why mill levies remained stable both during the real estate boom of the mid-2000s and during the depths of the national recession that began in 2008. During that downturn, property values in some parts of Eagle County declined by 30% or more.
Eagle County Commissioner Jeanne McQueeney said there are no solutions to the value increase/property tax equation at the moment. But, she added, the Colorado legislature is working on potential solutions to the problem.
Local and state government officials are currently having “hard conversations,” McQueeney said. “We want people to be aware (of the increase) well beforehand,” she added.
McQueeney added that county officials will be sure to prepare to handle the expected flood of appeals. That’s essential because there are deadlines tied to that appeal process.
At the moment, McQueeney said the best thing residents can do to brace for the potential increase is to plan ahead.
“If you’re paying (property taxes) all at once, that’s more of a shock,” McQueeney said. Those with mortgages are likely to see noticeable increases in their monthly payments.
McQueeney said the fix for the current situation would be giving local governments the ability to move their mill levies up and down. But that would probably require voter approval as well.
For now, though, residents need “to be thinking about this, and take these months to prepare.”