Larimer County's 2024 budget won't include a mill levy decrease. Here's why.

Larimer County commissioners have backed off from a promise to temporarily reduce the county's mill levy — and associated property taxes — after the Colorado General Assembly last month passed Senate Bill 1, providing one-year tax relief for homeowners after Proposition HH's November failure.

On Tuesday, commissioners will get an overview of updates to the 2024 proposed budget that includes allocating $8 million to the county's disaster contingency fund and restoring about $4.7 million in service cuts that would have been necessary had Proposition HH passed.

The county's final 2024 budget, which is expected to be adopted after a public hearing on Thursday, stands at $594,274,571, including an additional $13.4 million in property tax revenue.

Following a four-day special session last month, Colorado lawmakers passed SB 1, which provided property tax relief and the promise of protecting tax refunds residents receive through the state's Taxpayer's Bill of Rights, or TABOR. The bill mirrored many of the provisions in Proposition HH, but for one year rather than 10.

For 2023 property taxes paid in 2024, the bill reduces the statewide assessment rate from the current 6.765% to 6.7% and increases property tax exemptions to $50,000.

That means a home with an assessed value of $500,000 will have a taxable value of $450,000 after the exemption.

The passed bill also requires the state to reimburse local governments for any property tax revenue they lose due to the reductions in property valuation, without impacting the TABOR refunds that became a rallying point against HH. Fire districts will also be reimbursed for any lost property tax revenue.

Under the bill, a home’s taxable value is determined by taking a home’s assessed value, subtracting $50,000, and multiplying the remaining value by the new statewide assessment rate of 6.7%.

With the failure of Prop HH and without legislative intervention, the county would have received a windfall in property tax revenue generated by this year's average 40% increase in property values. Commissioners never intended to capitalize on that and had vowed to temporarily reduce the county's mill levy, which is currently 22.434.

One mill equals $1 in property tax per $1,000 of a property's assessed value. Senate Bill 1 won't necessarily reduce your tax bill next year, but the increase won't be as dramatic as it could have been without intervention.

The county is the second-largest beneficiary of property tax revenue on Larimer County property owners' bills, behind only the public school district in which they live.

Given the legislative relief, the county decided to focus the budget on "ensuring the county has sufficient funds" to respond to natural disasters such as wildfires and floods rather than offering a "modest" mill levy tax credit that was estimated to be on average less than $10 per residential property.

The county said in a statement the proposed budget "recognizes the county's concerns about fiscal unpredictability" including potential legal challenges related to Senate Bill 1, future ballot measures that would limit revenue growth to the Consumer Price Index, a history in Larimer County of natural disasters and recoveries, inflation, rising materials and rising labor costs.

SB 1 "provides immediate relief and empowers local governments like ours to make informed, impactful decisions for our communities," said Board of County Commissioners Chair Jody Shadduck-McNally. "This collaborative effort exemplifies how state and local governments can work together for positive change for all residents."

Key Larimer County 2024 budget dates

Tuesday, Dec. 12, 9 a.m. : Commissioners will discuss proposed changes to the budget at their regular administrative meeting. The public is invited to comment. Hearing room, Larimer County Administrative Services Building, 200 W. Oak St., Fort Collins.

Thursday, Dec. 14, 2 p.m.: Budget hearing. Hearing room, Larimer County Administrative Services Building, 200 W. Oak St., Fort Collins. Livestreamed at Larimer.gov/broadcast.

Wednesday, Jan. 10, 3:30 p.m. Commissioners will certify and submit their 2024 mill levies to the state.

All meetings are live streamed at Larimer.gov/broadcast.

Coloradoan political reporter Natasha Lovato contributed to this report.

This article originally appeared on Fort Collins Coloradoan: Larimer County 2024 budget won't include mill levy decrease. Here's why.