Colorado’s special session on property taxes has ended. What did legislators pass?

DENVER (KDVR) — The Colorado legislature’s 2024 special session ended Thursday after a whirlwind four days, with lawmakers approving a bipartisan bill to reduce the assessment rate for residential properties.

The bill passed the Colorado House on Wednesday, but not without some pushback . The measure had been serving as negotiations between state lawmakers and supporters of the statewide ballot initiatives 50 and 108. The pre-negotiated measure was designed to slow property tax increases.

The measure passed with a vote of 45-18 in the House, with 15 Democrats and three Republicans voting no. Two representatives were excused.

It passed the Colorado Senate with a vote of 30-4, with one senator excused. Three Democrats and one Republican voted against the measure.

Now the bill is headed to Gov. Jared Polis’ desk for his signature.

Senate Democrats applauded the bill’s passage in a press release, saying the bill introduces new flexibility for school districts and local governments “by allowing them to carry forward unused growth capacity into the next assessment cycle while shielding taxpayers from dramatic spikes in value growth.”

The bill also:

• Reduces the local government revenue cap to 5.25% annual growth (previously 5.5%), or 10.5% over one assessment cycle
• Changes the school revenue sharing ratio to a 6% annual revenue growth cap, or 12% in one assessment cycle
• Allows voters to override the local government revenue cap through ballot measures
• Allows school districts to override the cap at the state level
• Extends backfill for local government entities most impacted by this measure through 2025

The Property Tax Commission has also been tasked with evaluating the property tax changes made in SB24-233 and HB24B-1001 and reporting on how the tax code “does or does not deliver relief to the people who need it most,” according to the Senate Democrats.

One of the bill’s primary sponsors, Sen. Chris Hansen, a Democrat representing Denver and Chair of the Commission on Property Tax, said the bill “represents the culmination of more than six years of work.”

“This legislation is the product of partnership, compromise, and a shared commitment to the people of Colorado. The Commission on Property Tax, local governments, schools, and countless other stakeholders all have been involved in a public discussion of an extremely complicated problem – resulting in policy that provides both meaningful relief to taxpayers and stability for essential community services,” Hansen said.

“In recent years, we have been able to secure a stronger future for Colorado by ending the negative factor, creating a stable foundation for education funding, establishing sustainable funding paths for higher education and Medicaid providers, and now with this policy, we can avoid the devastating impacts of Initiatives 50 and 108 and protect the progress we’ve already made,” Hansen said.

Once ballot initiatives are pulled, governor plans to sign

It appears that Polis will sign the bill into law. In a release, the governor said he plans to sign the bill once ballot initiatives 50 and 108 are pulled.

“Today we took an important step for Colorado to end the property tax wars,” Polis said in a release following the special session. “With this bipartisan effort, we are saving hardworking Coloradans money on property taxes, saving households money on utility bills, making our small businesses more competitive, and protecting funding for our schools.

“I thank our legislative leaders for coming together to deliver savings for Coloradans. I look forward to seeing the risky ballot measures pulled down and signing this legislation into law so mall businesses and homeowners can keep more of their hard earned money,” Polis said.

To withdraw the measures, proponents of both measures will need to sign notarized letters to the Department of State requesting the measures be withdrawn. The deadline to withdraw ballot measures is Friday, Sept. 6.

Polis said the measure will reduce residential assessment rates to 6.25% — unless the statewide value growth exceeds 5% between 2024-2025. In that case, the rate would drop to 6.15%.

A similar measure was set up for school districts’ mill levies: the assessment rate was lowered to 7.05% and could drop to 6.95% if the statewide value growth exceeds 5%.

In a release, the governor’s office declared Coloradans will save “hundreds of dollars on their property taxes.” The office shared examples for various areas of the state:

• Denver’s median home price is $709,920
  • Average savings for Denver residents would be $233.47 in tax year 2025 and $259.91 in tax year 2026.
• Adams County median home price is $556,660
  • Residents will see an average savings of $324.22 in the 2025 tax year and $366.42 the year after
• Garfield County’s median home price is $540,700
  • Residents will save on average $188.52 in tax year 2025 and $214.03 in tax year 2026
• Pueblo County’s median home price is $326,260
  • Residents will save an average of $173.26 in tax year 2025 and $196.36 in tax year 2026 on their property taxes

Advance Colorado and Colorado Concern, which have lobbied in favor of ballot initiatives 50 and 108, applauded the passage of the legislation on Thursday, saying the measure brings total annual tax relief for Colorado property owners to $1.6 billion.

“Today’s vote marks a huge win for Colorado taxpayers who have been hit with 30 percent average property tax increases,” said Advance Colorado President Michael Fields in a release. “For two years, we have said the solution taxpayers need is to cut taxes significantly and then put a cap in place so Colorado can avoid this crisis in the future. This bill gets that job done.”

The two lobbyist groups have agreed to not bring similar ballot measures for the next six years if the state’s rulemakers do not go back on the provisions of the bill.

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