2023 Property Tax Relief

Valuation changes. For the 2023 property tax year, section 1 of the act reduces the valuation for assessment (valuation) for multi-family residential real property and all other residential real property from the already temporarily reduced 2023 rate of 6.765% of the amount equal to the actual value minus the lesser of $15,000 or the amount that causes the valuation to be $1,000 to 6.7% of the amount equal to the actual value minus the lesser of $55,000 or the amount that causes the valuation to be $1,000. Reimbursement of local governments. The state is currently required to reimburse (backfill) local governmental entities for property tax revenue lost as a result of reductions in valuation enacted in 2022. The act maintains this 2022 backfill mechanism for those property tax reductions. Section 2 provides an additional backfill mechanism to backfill local governmental entities for property tax revenue lost as a result of the additional reductions in valuation enacted in the act. Section 2 requires the state to backfill the following local governmental entities a total of $54,000,000 for the total amount of property tax revenue lost by those local governmental entities as a result of the reductions in valuation in the act in the same manner as the 2022 backfill mechanism, except that:

• Ambulance districts, fire districts, and health districts are reimbursed entirely;
• Local governmental entities for which the assessed value of property in the local governmental entity increased by 15% or more between the 2022 and 2023 property tax years are not reimbursed at all; and
• The executive director of the department of local affairs and the property tax administrator shall determine, in a manner that is equitable with the amounts that fire districts are reimbursed, the amount that local governmental entities that provide fire protection services are reimbursed.

Section 2 also modifies both backfill mechanisms by:

• Specifying that the amount of revenue lost for a property tax year is based on a local governmental entity's mill levy for the 2022 property tax year, excluding specified mills;
• Clarifying how local governmental entities, which are defined in the act, are treated if their boundaries are in more than one county for purposes of the backfill; and
• Requiring the state treasurer to reduce a backfill to a local government entity as necessary to prevent the local governmental entity from exceeding its constitutional fiscal year spending limit.

Transfer to the state public school fund. Section 2 requires the state treasurer to transfer $146 million from the general fund to the state education fund to offset school district property tax revenue reductions. Local government budget deadlines. Sections 4 to 6 modify provisions in the "Local Government Budget Law of Colorado" for the 2024 fiscal year to account for impacts on a local government's budget due to changes to the assessed valuation of property within the local government's boundaries. Delinquent property tax payments. Section 14 waives the accrual of interest on delinquent property tax payments for the first payment of property taxes for the 2023 property tax year if a payment is made within 10 days after the mailing by the county treasurer of the property taxpayer's tax statement or notification of an electronic statement. Property tax deadlines. Sections 3 and 9 to 13 delay deadlines as necessary due to the valuation changes for the 2023 property tax year.

APPROVED by Governor November 20, 2023

EFFECTIVE November 20, 2023
(Note: This summary applies to this bill as enacted.)