Voter Info

In brief, 

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Proposition HH seeks to blunt the sharpest spikes in property taxes that are expected next year while giving local governments money to make up for property tax revenue they’d miss out on.

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To pay for it, the measure would increase the cap on tax collections imposed by the Taxpayer’s Bill of Rights by 1 percentage point each year. That would increase the state’s budget by about $170 million this year — and up to $2.2 billion per year in a decade.

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State officials would use up to 20% of the extra money to backfill the local governments for lost property tax revenue, and they would set aside up to $20 million for rental assistance programs to help residents who aren’t homeowners.

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The remainder would go directly to school districts, to offset their lost property tax revenue, and to other education programs — totaling $125 million this upcoming fiscal year and potentially more than $2.1 billion a year within a decade, according to projections.

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In another progressive tweak, lawmakers also incorporated into the proposal a one-time flattening of refunds that are due to taxpayers next year under TABOR. If voters pass Prop HH, all taxpayers would receive an estimated refund of $898, according to the Blue Book, versus the typical income-based refunds that send more money to wealthier Coloradans under the premise they paid more in taxes.

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The Nitty Gritty: 

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Property tax amounts start with the value of the property as determined by the county Tax Assessors’ office.  The Tax Assessor uses the value of similar properties that have been sold recently to assign a value to a given property.  That value is then reduced by various deductions, including the Senior Homestead exemption.  This reduced amount then becomes the amount subject to tax.

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The state sets an Assessment Rate, which under Proposition HH would be reduced to 6.7% for residential properties.  (There is also a reduction for commercial properties.)  The taxable value is then multiplied by the Assessment Rate.

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Finally, each taxing district sets a Mill Levy rate which varies from district to district.  (La Plata County has the fourth lowest Mill Levy of any Colorado County).  Multiplying the table value times the Assessment Rate times the Mill Levy gives the amount of property tax owed by the owner.

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The reduction in the Assessment Rate is just one of the effects of Proposition HH that would lower property taxes.  There is an additional $50,000 deduction for 2023 which drops to $40,000 in later years.  Under current law, if someone who qualifies for the Senior Homestead exemption moves to a different house, they lose that exemption for 10 years.  Proposition HH allows such a homeowner to continue to receive the exemption at their new home.  (This is partially retroactive.)

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Because landlords’ property taxes are increasing and those increases will likely be passed along to renters in the form of higher rent, Proposition HH gives an addition amount of $20 million to the state agency that provides rental assistance for low-income renters.

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Since various taxing entities will see a reduction in property tax income versus current law, Proposition HH allows the state to use money which would be refunded to taxpayers under certain conditions (TABOR refunds) starting in 2024, to be used to backfill (reduce) losses to those entities.  This money can only be used for that purpose and to support education.

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There are some other provisions in Proposition HH, but this covers the major items.  You should have received a “Blue Book” that gives detailed information.  The “Blue Book” is also available online.

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The downside is that, as property valuations climbed so quickly here in La Plata, it may not completely offset loss of property tax revenues in our county, resulting in a short fall for general services. As we currently rank 4th lowest mil levies in the state, that would hurt.

 

Conversely, we would begin filling in the hole in our entire education system. 

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Disclaimer:  The information above is our best understanding of how HH would work.  We do not claim that it is 100% accurate.  Please refer to the Blue Book for details.

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Want to learn more? If you can access the Denver Post, these articles are useful:

• Pro Prop HH

• Anti Prop HH

• Why the alternative to HH is absolutely catastrophically AWFUL and will be on the ballot in 2024. 

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Others weighing in as well: 

• Cary Kennedy: Proposition HH offers property-tax relief to homeowners, businesses and renters [Colorado Sun]

• Henry Sobanet: Prop HH is a responsible tax cut that supports schools and local services [Grand Junction Sentinel]

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Strong article in the Durango Herald on HH as well - the good and the bad.