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Home My WebLink Aboutagenda.council.worksession.20231211AGENDA CITY COUNCIL WORK SESSION December 11, 2023 4:00 PM, City Council Chambers 427 Rio Grande Place, Aspen I.Work Session I.A Aspen Chamber Resort Association (ACRA) Marketing Outlook I.B Property Tax and Mill Levy Overview I.C Council Memberships Review Zoom Meeting Instructions Join from a PC, Mac, iPad, iPhone or Android device: Please click this URL to join: https://us06web.zoom.us/j/89739161464? pwd=7ksxDLibcIX6AufM6dUvWvO6gHgBpN.1 Passcode: 81611 Or join by phone: Dial: US: +1 346 248 7799 Webinar ID: 897 3916 1464 Passcode: 81611 International numbers available: https://us06web.zoom.us/u/kbffhjhOQb mill levy discussion.pdf 1 1 Mill Levy Discussion December 11, 2023 2 2 Taxing Entity 2022 Tax Year (36.672 Mills)Limits / Notes Pitkin County GF 2.405 TABOR & 5.5% Statutory Limits County TV/FM Translator 0.289 TABOR & 5.5% Statutory Limits County Road & Bridge 0.187 TABOR & 5.5% Statutory Limits County Human Services 0.065 TABOR & 5.5% Statutory Limits Healthy Community Fund 1.010 TABOR Limits Ambulance District 1.100 Open Space and Trails 3.750 City of Aspen General Purpose + Abatements 4.354 TABOR Limits City of Aspen Clean Rivier (Stormwater)0.650 Aspen Fire Protection 2.568 Voluntarily reduce mills to limit 2024 revenues Aspen Sanitation (multiple levies)0.087 Aspen Valley Hospital (multiple levies)2.334 Debt levy will float down with 2024 AV increases Roaring Fork Transportation Authority 2.650 Likely target full mills Aspen School District (multiple levies)8.916 State may mandate max mills in some cases… Colorado Mountain College 4.085 Voluntarily reduce mills to limit 2024 revenues Colorado River Water Conservation 0.501 Aspen Historic Park and Rec District 0.300 13.6% of total levy 3 Actual Valuation 3 Tax Year 2022 Collection 2023 Tax Year 2023 Collection 2024 Change Residential & Multifamily $18,271,626,100 $30,963,322,300 69% Commercial & All Other $2,561,704,470 $3,259,508,520 27% Total Actual Value of Property $20,833,330,570 $34,222,830,820 64% Significant wealth added overall Change in value not uniform •Commercial values did not move as much as residential •Residential has a lot of variability 4 Assessed Valuation 4 Tax Year 2022 Collection 2023 Tax Year 2023 Collection 2024 Change Residential & Multifamily $1,269,279,590 $2,094,669,570 65% Commercial & All Other $739,623,540 $900,077,409 22% Total Assessed Value of Property $2,008,903,130 $2,994,746,979 49% Assessment rates vary by property type •Residential / multifamily very low at 6.76% (before special bill) •Commercial much higher at 29% Reduced some of the actual value impact •15 percentage point drop from actual value change •SB 23B-001 will not really affect this much further (more on this soon…) 5 TABOR Restrictions on General Purpose Levy 5 Tax Year 2022 Collection 2023 Tax Year 2023 Collection 2024 Allowance for Inflation 3.540%8.011% Allowance for New Growth 1.00%0.75% Total Revenue Growth Allowable 4.537%8.761% Mills Before TABOR Limit 5.410 5.410 Temporary Credit (1.069)(2.243) Mills After TABOR Limit 4.341 3.817 General Purpose Property Tax $8,720,648 $9,484,364 •TABOR is the real limiter… 6 Each Property Experience Will Be Unique 6 •Deed restricted affordable housing units will not see impact •Price appreciation will likely be more than offset by lowering mill levy •Could see a drop in property tax bill as a result •Lower cost free-market homes experienced greatest appreciation •Significant jump in home equity (wealth) •Also see greatest impact on property tax bill as a result •Higher value homes didn’t see as much escalation in value •Still added value, but not same sized jumps •Mill levy reductions will limit tax growth, offseting some of this price escalation 7 SB 23B-001 Impact 8 Assessed Valuation – ESTIMATED SB23B-001 8 Tax Year 2022 Collection 2023 Tax Year 2023 Collection 2024 Change Residential & Multifamily $1,269,279,590 $2,056,567,834 62% Commercial & All Other $739,623,540 $900,077,409 22% Total Assessed Value of Property $2,008,903,130 $2,956,645,243 47% Residential assessment rates drop •Residential / multifamily adjust from 6.76% down to 6.70% Reduction of Property Value being Assessed •Reduction was $15,000; now up to $55,000 Was 65% 9 SB 23B-001 Changes 9 General Purpose Levy BEFORE SB 23-001 Tax Year 2023 Collection 2024 AFTER SB 23-001 Tax Year 2023 Collection 2024 Total Revenue Growth Allowable 8.761%8.761% Actual Aggregate Property Tax $9,484,364 $9,484,364 Total Assessed Value of Property $2,994,746,979 $2,956,645,243 Mills Before TABOR Limit 5.410 5.410 Temporary Credit (2.243)(2.202) Mills After TABOR Limit 3.167 3.208 •No impact to City’s General Purpose levy collections initially No Change Change 10 SB 23B-001 Changes 10 •Does impact to City’s Stormwater levy collections (minimally) Preliminary estimate is for a $25K reduction BEFORE SB 23-001 Tax Year 2023 (Collection 2024) AFTER SB 23-001 Tax Year 2023 (Collection 2024) Total Assessed Value of Property $2,994,746,979 $2,956,645,243 Maximum Stormwater Mills 0.650 0.650 Projected Collections $1,946,586 $1,921,819 11 Option for Council 12 Summary Points 12 •Many taxing entities are limited to TABOR or 5.5% statutory limitations •Other entities are voluntarily limiting collections either because tied to debt service or simply revenue needs •Other entities are proposing to collect their full levy due to funding needs •Most homeowners saw significant wealth added as a result of jump in actual values •Price escalation was minimal on deed restricted affordable housing units, isolating them from any adverse impact on tax 13 Hypothetical Scenario #1 – TOTAL CoA 13 Tax Year 2022 Collection 2023 Tax Year 2023 Collection 2024 Value of Residential Home $500,000 $515,000 Residential Assessment Rate 6.950%6.700% Assessed Value of Residential Home $34,750 $34,505 General Purpose Mills 4.341 3.208 Estimated General Purpose Tax $150.85 $110.69 Stormwater Mills 0.650 0.650 Estimated Stormwater Tax $22.59 $22.43 Total Mills 4.991 3.858 Estimated Total City Property Tax $173.44 $133.12 $15K ($40.32) 14 Hypothetical Scenario #2 – TOTAL CoA 14 Tax Year 2022 Collection 2023 Tax Year 2023 Collection 2024 Value of Residential Home $5,000,000 $7,500,000 Residential Assessment Rate 6.950%6.700% Assessed Value of Residential Home $347,500 $502,500 General Purpose Mills 4.341 3.208 Estimated General Purpose Tax $1,508.50 $1,612.02 Stormwater Mills 0.650 0.650 Estimated Stormwater Tax $225.88 $326.63 Total Mills 4.991 3.858 Estimated Total City Property Tax $1,734.37 $1,938.65 $2.5M $204.28 15 Hypothetical Scenario #3 – TOTAL CoA 15 Tax Year 2022 Collection 2023 Tax Year 2023 Collection 2024 Value of Residential Home $2,500,000 $5,000,000 Residential Assessment Rate 6.950%6.700% Assessed Value of Residential Home $173,750 $335,000 General Purpose Mills 4.341 3.208 Estimated General Purpose Tax $754.25 $1,074,68 Stormwater Mills 0.650 0.650 Estimated Stormwater Tax $112.94 $217.75 Total Mills 4.991 3.858 Estimated Total City Property Tax $867.19 $1,292.43 $2.5M $425.24 16 Options 16 1)Keep TABOR limited General Purpose mills and maximum Stormwater mills $1.4M increase in revenue to City – funds go towards underfunded stormwater program and other capital infrastructure 2023 Revenue 2024 Revenue General Purpose $8,720,648 $9,484,364 Stormwater $1,305,787 $1,921,819 Total CoA Property Taxes $10,026,435 $11,406,183 17 Options 17 2) Keep TABOR limited General Purpose mills and partially reduce Stormwater mills Every 0.100 mill reduction is ~$300K less revenue* Optional: Backfill Stormwater with General Fund / AMP revenue 2023 Revenue 2024 Revenue (SW = 0.650 Mills) General Purpose Mill Levy $8,720,648 $9,484,364 Stormwater Mill Levy $1,305,787 $??? Total CoA Property Taxes $10,026,435 $??? 18 18 Questions? 19