County property assessments remained flat in 2022

Voter approved taxes add up to 10.3% increases for North Valley

[  By Katherine Nettles  ]

The county assessor’s office has reported flat total assessed values for 2022 due to legislative changes in assessment rates, but homeowners will see higher tax bills going forward due to the additional mills and other tax increases that voters passed at the ballot boxes in November. County officials warned residential property owners that a big jump in their tax bills is likely to be seen in a year due to assessment changes as well. Meanwhile continual growth across the Gunnison Valley is not necessarily generating the income to increase county-based services.

Gunnison County assessor William Spicer reported to county commissioners during their regular meeting in late December that total assessed tax values were stagnant in 2022, despite record growth in new construction. The total tax revenue for all taxing entities within the county—not just the county itself—will be $59.3 million for 2022, up from $52.2 million in 2021. While this represents a 13.6% increase, according to Spicer, the majority of that increase was due to two significant voter approved tax increases. 

Total assessed value means the county’s property valuations that are used to calculate taxes. The tax revenue formula, as Spicer reviewed, is each assessed property value multiplied by the mill levy.  

Without those voter changes, Spicer estimated growth was about 3% because of the statewide assessment decreases, despite, as county manager Matthew Birnie described it, “a record year of growth.” 

“Revenues were pretty much static this year, which was unusual,” said Spicer of the county portion. He said it was the first time he can remember that housing construction and growth did not end up raising overall assessed values, due to the statewide repeal of certain aspects of the Gallagher amendment followed by property tax assessment reductions. 

“Typically in a non-reappraisal (i.e. even-numbered) year, the main change in value would be due to new construction. Because adding new buildings to the tax roll increases value, we would expect to see total assessed valuations increase slightly in even-numbered years,” Spicer explained further to the Crested Butte News.

“But for 2022, the legislature chose to reduce some of the statewide assessment rates. This has not happened before in an even-numbered year (since the Gallagher amendment was passed back in the 1980s). When that portion of Gallagher was repealed by the voters in 2020, the legislature was given the authority to change assessment rates in any year. Previously, the residential assessment rate could be adjusted downwards only in an odd-numbered year. But for 2022, the legislature lowered the residential rate from 7.15% to 6.95% (together with some other minor changes).”

That reduction in the residential assessment rate effectively counterbalanced any increase in overall values due to new construction, which had otherwise provided an increase of about 1.5%. 

“For most entities in Gunnison County, the net effect was a small reduction in total assessed valuation. For example, the Gunnison School District saw their net assessed value drop from $765 million to $759 million. The County itself saw a slight increase in net assessed value from $811 million to $815 million, but only because of a significant increase in natural gas production in the northwest area of the county,” said Spicer.

 Without the state changes to assessment rates, Spicer estimated that the county’s 2022 net assessed valuation would have been about $830 million, with about $13 million of that increase coming from new construction, and the rest from increased natural resource production. 

Spicer noted that the higher taxes taxpayers will see going forward is largely due to the additional mills and other tax increases that voters passed. The Gunnison Watershed school bond issue accounts for about $4.4 million and the new MetRec North Subdistrict levy for about $900,00 in new tax revenue. 

“So out of the total 13.6% increase, about 10.3% was directly voter approved. The remaining 3.3% results from other taxing entities increasing their mill levies, typically by reducing the amount of credit levy that they are carrying relative to 2021.  For example, the County reduced its credit levy from 2.495 mills for 2021, to 0.920 mills for 2022.”

As far as the impact on individual taxpayers, Spicer said this will vary depending on where in the county someone lives. “But most residential property owners can expect to see about an 11% increase. For example, in the City of Gunnison the taxes on a residential property will increase from $371 per $100,000 of value to $411 per $100,000. In the Town of Crested Butte, the equivalent increase will be from $493 per $100,000 to $545 per $100,000. Commercial property owners will see a bigger increase, because the commercial assessment rate is unchanged at 29% for 2022. On average their increase will be about 14%,” according to Spicer.

Spicer and county chief financial officer Perry Solheim announced that the assessor’s office also plans to start working with the county finance department which will help streamline processes for taxing entities going forward. Spicer also cautioned that assessed residential values will likely go “way up” next year because the biennial revaluation last occurred in the spring of 2021 at what appears to have been a height in the housing market.