Denver homeowners may be in for a shock: letters from the assessor will show that updated property values have risen.
Those numbers are big and will eventually dictate property taxes.
The Denver assessor himself said the rise in home values, a 33% median increase from July 2020 to June 2022, is unprecedented in his time in the office.
"Yes, 33% is the highest I can recall," said Denver Assessor Keith Erffmeyer. "I've been with the office for 29 years."
Denver was actually on the lower end of large Front Range counties, according to data released by a group of metro assessors Wednesday. Douglas County saw a 47% increase in residential values, Larimer was up 40%, and in Arapahoe County home values jumped 42%.
Worried about your tax bill? Here's what you need to know about appealing your property's value and other tax relief resources.
This is the beginning of a long process that will ultimately determine what property tax bills look like next year.
First, the assessor determines a value for all property, then assessment rates will be set by the state and mill levies by local governments.
The property assessment period came at a time of extraordinary home price growth, as COVID and as high earners moving in from out of state pushed up the value of single family homes.
"People got the ability to work remotely," said JoAnn Groff, Colorado's Property Tax Administrator. "They didn't have to necessarily stay in New York and San Francisco and Los Angeles. They could move to beautiful Colorado. And people wanted to get out and about, they didn't like being wrapped up in the privacy of COVID anymore. And so we saw some pretty dramatic increases in value."
In the past, the Gallagher amendment in Colorado's constitution would have automatically reduced the reassessed value of residential property at a time like this.
But voters repealed that back in 2020.
So it's a one-two punch: much higher home values, and no automatic cap on property tax rates from Gallagher.
One of the leading voices behind the Gallagher repeal was Denver mayoral candidate Mike Johnston. He was the head of Gary Community Ventures at the time, which contributed $1.5 million towards the campaign.
There was a broad coalition to repeal Gallagher. Business groups supported repeal, because it created what they called crushing bills for businesses paying higher commercial property taxes.
And many local governments supported repeal, too, because capping residential taxes meant some governments struggled to fund basic services, schools, and frontline workers, like firefighters and nurses.
"Do we want to, in this moment, turn our back on those public servants who have had our back" through COVID, said Johnston in a 2020 video in support of the Gallagher repeal.
Johnston's campaign wasn't able to accommodate an interview request for this story about his involvement in repealing the Gallagher amendment.
Voters approved the repeal by a wide margin, but it did not include a mechanism for protecting homeowners from a situation like today, where Gallagher would have provided some homeowner tax relief due to skyrocketing residential values.
The legislature instituted some fixes last year, like reducing the taxable value of homes by $15,000, to blunt the impact, about $1 billion in total property tax savings, according to Gov. Jared Polis's office.
And Polis's office said more relief is on the way.
"The Governor is committed to making sure people don't see steep increases in their tax bills next year. The Governor is working on a plan with the legislature to reduce property taxes and protect property owners from projected increases as values rise and expects to present it soon," reads a statement from Conor Cahill, Polis' spokesman.
Senate President Steve Fenberg acknowledged they were running out of time in the legislative session, but said they wanted to see what the scope of the property increases would be.
"To better understand sort of the severity of the problem," said Fenberg. "And there are a few paths that we could take that we're considering, but we're probably hoping to make a final decision on what that bill's going to look like in the next few days."
One measure that is already far along in the state legislature is a bill that would allow local governments to lower property taxes temporarily.
This confluence of high prices and limited tax rate relief, "it's just a real unfortunate chain of events that happened," said Republican State Sen. Mark Baisley, a sponsor of the bill. He hopes it can clear the House soon. The legislative session ends May 8.
For now, property owners that disagree with the assessor's valuation of their home have until June 8 to file a protest. Keith Erffmeyer, the Denver Assessor, said about half of protests are successful.
But it requires providing some evidence to make a case, "whether it's, 'you don't know this about my property,' or 'here's some sales in my neighborhood that maybe you didn't consider.'"
And don't get hung up on the percent increase, he suggests.
"We really want them to focus on that new value and, could they, would they have sold their property for that last June? And if not, we'd like to know more why that might not be the case," said Erffmeyer.
