Bill Summary:

Property tax in Colorado is generally equal to the actual value of property multiplied by an assessment rate, and the resulting assessed value is multiplied by each applicable local government's mill levy. The assessment rate for residential real property is established by the general assembly in accordance with a provision of the state constitution that is commonly known as the "Gallagher Amendment" and is limited by section 20 of article X of the state constitution (TABOR). Under the Gallagher Amendment, there are 2 important classes of property for the purposes of determining the residential assessment rate: residential property and nonresidential property. The assessment rate for most nonresidential property is fixed in the state constitution at 29%. The residential assessment rate was initially set at 21%, but the rate has been adjusted prior to each 2-year reassessment cycle to keep the percentage of aggregate statewide assessed value attributable to residential property the same as it was in the year immediately preceding the new reassessment cycle. Currently, the residential assessment rate is 7.15%. The concurrent resolution repeals the Gallagher Amendment so that the general assembly will no longer be required to establish the residential assessment rate based on the formula expressed in the Gallagher Amendment. The resolution also repeals the reference to the residential rate of 21%, which last applied in 1986, prior to the first adjustment required by the Gallagher Amendment. Finally, the resolution repeals the 29% assessment rate that applies for all nonresidential property, excluding producing mines and lands or leaseholds producing oil or gas. (Note: This summary applies to the reengrossed version of this concurrent resolution as introduced in the second house.)

CEA Position Rationale: CEA supports fixing Colorado's complicated and inequitable funding of public education. A repeal of 'Gallagher' cannot be the sole solution to our current fiscal crisis nor will it's repeal bring in sufficient immediate funds to end the BS factor. However, ending Gallagher will help untangle a portion of the knot of CO tax law that prevents our public schools from being fully funded. Additionally, if Gallagher is repealed by voters the local property taxes that fund a portion of public education could increase, or at least not decrease again, in the future.

Legislative Priorities: Increase Funding and Resources to Public Education and Educators

Tier: 3