The town of Basalt’s overcollection of property taxes is, for sure, a messy and complicated issue.
The town administration and elected council have been trying for the better part of 2019 to clear up the mess. The Nov. 5 general election plays an important role in the solution.
The town is asking voters to approve a general operating tax rate of 5.957 mills, which is the same amount as last year. It is needed for the town’s basic services: police work, road maintenance, snowplowing, park maintenance, recreational programs and the like.
The town needs its mill levy re-established because of mistakes made by the staff and elected officials going back decades. Colorado voters approved the Taxpayers Bill of Rights in 1992. It limits tax revenue growth and requires voter approval for tax increases.
Basalt town government voluntarily lowered the property tax rate consistently in the 1990s and in the later half of the 2000s. As property values increased, the town was often able to collect the same amount of revenues even by lowering the tax rate. In addition, the town council purposely lowered the tax rate during the Great Recession to lessen the burden on property owners feeling the financial squeeze.
Dropping the mill levy wasn’t a problem, but when the town felt it had to raise the tax rate, it ran afoul of TABOR. Past and present elected officials said in hindsight they believed they could raise the rate as long as they didn’t exceed the levy in place at the time TABOR was approved. That was an incorrect assumption.
The mill levy was increased 10 times since 2005 in violation of TABOR. That included last year, when it was raised to 5.957 from 5.792 mills.
If voters don’t approve establishing it at 5.957 mills, it must drop to the lowest level since TABOR was approved. That would reduce the tax rate to the 2.562 mill levy set in 2009. Basalt would be forced to cut an estimated $700,000 from its annual budget.
Basalt voters should approve the 5.957 mill levy. First, it’s needed for essential services. Basalt’s town government would be down to bare bones without the higher mill levy.
Second, the current administration has demonstrated fiscal responsibility. Finance director Christy Hamrick and Town Manager Ryan Mahoney discovered the TABOR violations and brought them to the attention of the council. As a result, Basalt is issuing nearly $2 million in property tax refunds to current taxpayers for overcollections that occurred in the past four years.
Third, approving the 5.957 mills will not increase property taxes above last year’s level. TABOR requires specific ballot language any time there is a tax question. This question is phrased in a way that makes it sound like it is proposing a tax increase of $740,000. In reality, that’s the amount more than proposed mill levy would raise over what the mill levy would fall to without voter approval.
And finally, as the ballot question promises, Basalt cannot raise property taxes in the future without voter approval — and this time everyone will be paying attention.
Ballots will be mailed Oct. 7. Basalt voters should approve the mill levy request.
The Aspen Times editorial board consists of publisher Samantha Johnston, editor David Krause and reporters Rick Carroll, Scott Condon and Carolyn Sackariason.