Calculation of Property Tax for Special Districts
The intended change in property tax calculation aims to align the tax liabilities more closely with the special districts' budgets and the economic conditions by incorporating inflation and changes in population. This could lead to a more equitable taxation process which could potentially benefit districts that are experiencing population growth or increased economic activity. Conversely, it may lead to increased tax burdens for property owners in districts with stagnant or declining property values.
SCR002 proposes an amendment to the Colorado Constitution regarding the calculation of property tax for special districts. This bill is set to alter the existing method of property tax assessment, which typically computes property tax by valuing the property and applying an assessment rate on it. The new approach, effective from January 1, 2025, would calculate the property tax levy based on the special district's budget, taking into account the actual value of the property in comparison to the total actual value of taxable property within the same district.
While the proposed amendment has the potential to simplify the tax calculation process and provide more consistent revenue streams for special districts, there are concerns from various stakeholders regarding the potential disparities it might create. Critics argue that linking taxes more closely with special district budgets could unfairly disadvantage property owners in districts that are already under economic hardship. The bill has faced opposition in previous votes, indicating significant debate among lawmakers regarding its implications for both tax equity and local financial autonomy.