Loveland City Council Chambers
A bid to bring tax relief to Loveland residents and businesses went down to defeat on Tuesday, after the City Council decided that the projected loss of $1.6 million in revenue was too high a price to pay. By a vote of 8 to 1, members rejected an emergency ordinance to certify Loveland’s 2023 mill levy at 8.564 and will instead certify it at 9.564 mills, a rate enacted more than 30 years ago.
“I’m not willing to do a double whammy on the city and take away the sales tax on food and reduce the mills,” Loveland Mayor Jacki Marsh said before voting against the measure. “I would rather wait and see and then target next year to look at it if we think it’s reasonable to reduce the property tax. “
Councilor Dana Foley introduced the motion at a meeting in December, as a way to share the “windfall” from record-high assessments in 2023, but the council put off the decision until the city finance office could provide more detailed information about the impacts.
That came on Tuesday night in a presentation from city Chief Financial Officer Brian Waldes, who walked the council through the potential impact of the move for both taxpayers and the city.
First, Waldes pointed out that at 9.564 mills Loveland has one of the lowest property tax rates in Northern Colorado, second only to Timnath, at 6.6. By comparison, he said, Fort Collins levies 9.8, Longmont 13.1 and Johnstown levies 23 mills.
Waldes also emphasized that the city’s mill levy also accounts for just 12% of a resident’s total property tax bill, while the Thompson School District accounts for 47% and Larimer County accounts for about 28%.
According to Waldes, a one mill reduction would have potentially saved a Loveland taxpayer with a home assessed at $500,000 around $34 on their 2024 tax bills, which will be mailed by Larimer County at the end of the month.
At the same time, commercial property owners with a similar assessment would have saved $140, or four times the savings for residential payers.
But it would also mean a $1.7 million loss in the city’s projected revenues for 2024, Waldes said, on top of a projected loss of more than $10 million due to the elimination of the city’s sales tax on food.
“I’m putting this here to inform this conversation that if we do contemplate a $1.6 million reduction to property tax, or any other reduction for that matter, or any increase to expenses, we have to keep this in mind,” Waldes said, referring to a slide showing Loveland’s estimated revenue from grocery sales through October 2023. “Because that’s 10 months, totaling $11 million. It is not an analysis. It’s just fact. it’s just history. “
That point was one that resonated with several members, who, like Marsh, said that they don’t want to deprive the city of too much tax revenue all in one year.
One the other side of the question was Foley, and his support of the motion was as fervent as ever. He argued strongly in favor of the reduction, and said residents and businesses deserve that relief, as much as they deserve the sales tax relief.
“I think we should give it and I think that we should look at other ways to be more efficient with the city,” Foley said. “And I think we need to make it equitable,” for both residential and commercial property owners, he continued.
Foley went on to be the lone vote against the measure.
Though the City Council declined to reduce the mill levy this year, Loveland residents will be getting some property tax relief from other entities, Waldes explained in his presentation.
In the wake of the failure of Proposition HH in the November election, the Colorado General Assembly passed senate bill 23B-001, which reduces the statewide residential assessment rate from 6.765% to 6.700%, and raises the exemption amount to $55,000 from $15,000. It will result in $811,850 total in savings for Loveland taxpayers, or around $29 on the tax bill for a home assessed at $500,000.
Larimer County has also announced that it will be giving back some property tax revenue, though details have not yet been finalized.
