Legislative Update on Property Taxation and New Arbitration Procedures
| Jurisdiction | Colorado,United States |
| Citation | Vol. 17 No. 9 Pg. 1751 |
| Pages | 1751 |
| Publication year | 1988 |
1988, September, Pg. 1751. Legislative Update on Property Taxation and New Arbitration Procedures
In 1988, the Colorado Legislature enacted a substantial number of changes to statutory ad valorem taxation procedures, and to the methods by which county assessors are to value and assess real property. These changes were in part a response to the overwhelming volume of protests and appeals brought in 1987.
Due to the shifting of "base periods" by which the assessors were to value properties throughout the state from 1977 levels to 1985 levels, large increases in assessed values and the potential tax increases resulting therefrom brought on record numbers of protests and appeals.(fn1) In many instances, statutory deadlines for notices and completion of hearings were missed, and the State Board of Assessment Appeals ("SBAA"), which hears appeals on a de novo basis following hearings at the county level, continues to be burdened by a sizable caseload.(fn2)
During the 1987 period of notice, protest and appeals, county assessors attempted various procedural steps not authorized by statute, basing their actions upon "impossibility of performance," urgency or similar grounds.(fn3) Significant questions will be raised in liltigation concerning any number of procedural and due process questions.
This article summarizes legislative actions taken to curtail these problems in ad valorem taxation for 1988 and subsequent years. The principal legislative measures affecting real and personal property ad valorem taxes in 1988 were Senate Bill ("S.B.") 184 and House Bills ("H.B.") 1016 and 1044.(fn4)
S.B. 184, signed into law May 23, 1988, addresses taxpayer rights. The most significant aspect of this bill is the enactment of new CRS § 39-5-122.5, which creates a right of tax credit for overstated 1987 valuations in the event a taxpayer successfully challenges a 1988 real property valuation. Since the "base period" by which the assessors establish value is the same for 1988 as it was for 1987, the 1988 appeals which result in a lowered valuation will relate back to the 1987 tax year.
Excepted from this provision are owners of property who stipulated in writing or on a record as having agreed to a valuation with the assessor, a county board of equalization or the SBAA. Taxpayers are not, however, precluded from appealing a 1988 valuation which is equal to a stipulated 1987 valuation. Such taxpayers merely forego the right of a credit for the 1987 levy.
The ratio of valuation for assessment (ratio of assessed value to actual value) for residential real property is reduced from 18 percent to 16 percent for the 1988 tax year by S.B. 184.(fn5) In subsequent years, the state Property Tax Administrator is required to determine a "target percentage" to insure that, consistent with Article X, § 3 of the Colorado Constitution, the percentage of the aggregate statewide valuation for assessment attributable to residential real property remains the same as it was in the year prior to the change in levels of value.(fn6) Thus, after January 1, 1989, the General Assembly will adjust the residential rate to equal the "target percentage," which may move up or down, but which in any event must comply with the Constitution. Taxpayers are prohibited from protesting valuations on the basis...
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