Are Colorado Springs residents, as proponents of November’s proposed property tax increase claim, starving the city of needed revenue by enjoying unsustainably low tax rates? Or are the opponents of the tax hike correct in saying that the city has plenty of money, but seems incapable of properly managing its revenues?
When Colorado Springs is compared to Boulder, Denver, Fort Collins and Pueblo, local tax rates and tax burdens fall in the middle. They are neither high nor low — comparatively speaking.
That determination is based on considering the tax burden from a broad perspective, not ferreting out and analyzing every fee that local governments impose, and determining whether such fees are really taxes in disguise.
Defining such minutia is up to the courts — and in any case, the fees in question, such as storm water fees, generate only a tiny fraction of the total revenue that flow into the coffers of local governments.
And while selective use of tax statistics can strongly support arguments both for and against the proposed mill levy increase, passage would not substantially affect residential property tax bills, since the city collects only a small proportion of the total property tax bill.
Presently, Colorado Springs’ share accounts for between 6.4 percent and 8.4 percent of the combined mill levy, depending upon the school district in which a residence is located.
If approved by voters, the city mill levy would increase by 10 mills during the next six years. The first year’s increase would be five mills, with an additional one mill increase during each subsequent year.
However, because of bewilderingly different tax structures, straightforward rate-to-rate comparisons between jurisdictions are difficult to make.
For example, Fort Collins’ overall sales tax rate of 6.7 percent is substantially below Colorado Springs’ 7.4 percent rate, but because Fort Collins, unlike the Springs, imposes a 2.25 percent tax on food, the difference is misleading.
A low-income family in Colorado Springs would likely pay less tax than its counterpart in Fort Collins.
The state imposes a 2.9 percent sales tax. All five cities and counties used for comparison also collect sales taxes, and all include special taxing entities within their borders.
Taxpayers who live in El Paso County pay county property taxes of 7.748 mills, as well as a 3.540 levy for the Pikes Peak Library District. Total so far: 11.288.
After that, it gets a little murky.
Those living within the city limits pay another 4.944 mills to the city, bringing the grand total to 16.232. Those who live in any of seven other municipalities within the county pay between 6.289 mills (Monument) and 19.827 mills (Ramah).
Next step: special taxing districts.
There are 25 fire districts, with levies ranging from 0 to 12.423, 79 metropolitan districts (0-53), four sanitation districts (0-4.5), 17 school districts (24.301-60.216), 27 special improvement districts (1.00-51.00), 11 water districts (0.532-14.437), and four water and sanitation districts (4.001-25.517).
The Southeastern Colorado Water Conservancy District, created during the 1960s as part of the funding package of the Fryingpan-Arkansas water diversion project, levies a tax of 0.943 mills.
Grand total so far: 17.175.
And now the big ones: the school districts. Here’s what the owner of a $200,000 pays.
Harrison School District 2 levies a tax of 41.409 mills, for a grand total of 58.584 mills and a total bill of $932.65.
Widefield School District 3 levies 47.683 mills, for a total of 64.858 mills and a total bill of $1,032.52.
The total for School District 11, after the addition of a levy of 42.331 mills for a total of 59.506 mills, is $947.33.
Cheyenne Mountain School District 12 levies a tax of 42.331 mills, for a total of 61.969 mills and a total of $986.54.
And Academy School District 20 adds 60.216 mills for a total of 77.391 mills and a payment of $1,232.06.
So, suppose that voters approve the proposed tax increase come November.
That would initially increase property taxes on our theoretical $200,000 house in District 11 by $79.60, and by an additional $15.92 annually during the next five years, for a total increase of $159.20.
Residents of Colorado Springs also pay a total of 7.4 percent in sales taxes when they purchase non-exempt goods. Food, medicine and most services are not taxed.
The city gets 2.5 percent, which includes 0.1 percent for trails, open spaces and parks, and 0.4 percent for public safety
The Pikes Peak Rural Transportation Authority and El Paso County each get 1 percent, and the state gets 2.9 percent.
The city also levies other taxes and fees, including a 2.5 percent use tax, an occupational tax on “establishments selling alcoholic beverages,” a sales tax on “motion picture theatre tickets,” a monthly cable franchise fee of $1.20 per subscriber, a 2 percent lodging tax and a 1 percent automobile rental tax.
The City and County of Denver’s combined mill levy, including 39.657 for Denver Public Schools is 66.783, making the property tax on a $200,000 home $1,063.18.
That figure doesn’t differ significantly from the combined levies for Colorado Springs, El Paso County and District 11 — but Denver has many ways of attacking residents’ wallets.
The city/county sales tax is 3.62 percent, and rises to 4 percent for non-exempt items sold at “food, beverage and liquor stores.”
The Regional Transportation District tacks on 1 percent; the Scientific and Cultural Facilities District adds 0.1 percent; the Football Stadium District adds 0.1 percent; and the state still gets its 2.9 percent.
That makes a grand total of 7.72 percent, only slightly higher than Colorado Springs.
In addition, Denver levies an “occupational privilege tax,” payable by both employees ($5 per employee per month) and employers ($5.75 per employee per month). Then there’s a “facilities development admission tax,” consisting of a 10 percent surcharge on tickets sold to any event taking place in a facility “owned or leased by the City of Denver.”
And while Denver’s nominal sales tax rate is 3.62 percent, the city charges 4 percent on the sale of food or beverages in a restaurant. The city also levies a tax of four cents a gallon on aviation fuel, collects a monthly “telephone and telecommunications tax” of $1.12 per subscriber, a 4 percent use tax, an 11.95 percent lodging tax and an 8.45 percent automobile rental tax.
Note that Denver’s lodging and automobile rental taxes are respectively six times and eight times greater than those imposed by Colorado Springs.
The “City of Denver Tax Guide” gives, in sometimes-fascinating detail, a useful snapshot of Denver’s complex system of taxation.
Here’s an excerpt: “The sales and purchases of horses are taxable unless they can be used for breeding purposes, or unless they are purchased for resale.” (http://www.denvergov.org/Portals/571/documents/TaxGuide/Horses.htm).
It’s hard for a layperson to understand why, in the example cited in the guide, the purchase of five mules and five geldings would be taxed, while that of a stallion and five mares would be exempt — but the arcana of municipal tax policies are not easily subject to amateur analysis.
For Pueblo residents, the nominal sales tax rate of 7.4 percent is identical to that of Colorado Springs, and distributed identically between city (3.5 percent), county (1 percent) and state (2.9 percent).
Property taxes, however, are somewhat higher than those of either Colorado Springs or Denver.
Pueblo County levies a tax of 31.195 mills. The City of Pueblo levies at tax of 15.633 mills.
School District 60, which includes most of the city and is the county’s largest, levies a tax of 37.966 mills.
Among the four school districts located in Pueblo County, mill levies range from 37.966 to 40.804.
Southeastern Colorado Water Conservation District then adds a 0.943 mill levy for a combined total of 85.737 mills.
The total tax payment on a $200,000 home: $1,364.93.
Boulder residents pay the highest sales taxes of any of the “Front Range Five”: 8.16 percent.
The city gets 3.41 percent; the Regional Transportation District gets 1 percent; the Football Stadium District and the Scientific and Cultural Facilities District each receive 0.1 percent; Boulder County gets 0.65 percent; and the state gets its 2.9 percent.
Boulder’s combined property tax rates, while higher than those of most Colorado Springs residents, are below Pueblo’s and less than those paid by property owners in School District 20.
The City of Boulder levies 9.841 mills; Boulder County levies 23.067; the Northern Colorado Water Conservation District adds 1 mill; and School District RE2 (which includes all of Boulder County) levies 39.113.
The total combined levy is 73.021 mills, and the property tax on a $200,000 home (if such a thing exists within Boulder’s city limits): $1,162.49
Residents of this northern Colorado city pay the lowest sales taxes among the five, with a combined rate of 6.7 percent.
The city collects 3 percent, the state takes its customary 2.9 percent, and Larimer County gets 0.8 percent.
Unlike any of the five, however, the City of Fort Collins collects sales tax on “food for home consumption,” although at a slightly lower rate of 2.25 percent. Jurisdictions that exempt food from local sales taxes do so because such taxes are considered highly regressive, unfairly burdening low-income residents.
Property tax rates, by contrast, are the highest of the five, narrowly edging Pueblo.
The City of Fort Collins levies 9.797 mills; the library district gets 3 mills; the Fort Collins/Loveland water district levies 1.50 mills; the health services district receives 2.167; Larimer County levies 22.395 mills; Larimer County pest control gets 0.142; the Northern Colorado Water Conservancy District gets 1 mill; and Poudre R-1 School district levies 47.989.
The total combined mill levy is 87.99, and property tax on a $200,000 home is $1,400.80
Sales tax rates among the five counties and municipalities fall within a relatively narrow range: from a low of 6.7 percent to a high of 8.16 percent.
Combined mill levies, which depend principally on school districts, vary between 58.584 and 87.99.
Among the cities and counties, Colorado Springs and El Paso County have exceptionally low property tax levies, but our five largest school districts have an average mill levy of 47.2866, higher than any district except Fort Collins at 47.989.
Which brings us right back to where we started — smack dab in the middle.