Garfield Re-2 board passes certification of mill levy increase
A motion to increase property taxes within the Garfield School District Re-2 passed unanimously Wednesday.
In response to a historical error made by lawmakers and education officials trying to interpret state law previously enacted nearly 30 years ago, the district has to increase its mill levy enough to help balance the state’s education budget.
Wednesday’s vote officially increased the district’s mill levy from 4.7 to 16.282 mills.
The board, however, also implemented a temporary tax credit of 10.582 mills, which will gradually be reduced over the next 11 years until property owners are paying the full mill levy by 2032. This means property tax payers will essentially see their mill levy increase by one mill each year until the tax credit ends.
A mill levy is implemented based on property valuation multiplied by the assessment rate. For example, a property assessed at $200,000 multiplied by Colorado’s residential assessment rate of 7.15% (actually multiplied by .0715) results in an assessed property value of $14,300. That figure is then multiplied by the district’s mill levy. Under the 4.7 mill levy (actually multiplied by .0047), a property owner with an assessed property value of $14,300 was paying about $67 annually to the Re-2 school district.
Once the tax credit reaches zero and the new mill levy reaches the full 16.282, a property owner with an assessed property value of $14,300 should pay about $232 annually to the Re-2 district.
In other words, property owners will be paying more than three times as much as they were to the local school district.
The eventual increase stems back to 1992, when Colorado lawmakers adopted the Taxpayer Bill of Rights, an amendment that limits the amount of tax revenue the state retains and spends. Any school district that chose to opt out of this state regulation was told by the Colorado Department of Education it could start reducing its mill levy.
Garfield Re-2, which opted out of TABOR in 1998, would gradually reduce what it charged property owners from 26.177 to 4.7 mills by 2007. The district then froze its mill levy in response to the 2008 recession.
Years ago Colorado’s share toward its education budget was 50%, while districts supported the other half via property tax revenue. But as districts began reducing their share under the impression they were following protocol, the state’s share for education increased to about 66%.
Garfield Re-2 Chief Financial Officer Jeff Blanford said on Wednesday the increase will take effect in January.
But in 2020, state legislators passed laws aimed at correcting this unintended shortfall. Under HB20-1418, school districts that opted out of TABOR and began reducing their mill levies are being asked to re-implement increases on property taxes.
“Within the bill here requires districts to raise mills by no more than one mill per year,” Blanford said. “So that 10.582 is going to take us 11 years to get to the 16.282.”
Board members expressed concerns over what could happen to the district if they opted not to increase the mill levy.
Garfield Re-2 board member Britton Fletchall said it’s imperative they make the decision now.
“Otherwise, we’re going to get further in the pit,” he said.
Board member Tony May concurred.
“This board could vote no all the way across,” he said. “But in doing so, by state law, we will forego funding for the district.”
Reporter Ray K. Erku can be reached at 612-423-5273 or email@example.com.
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