Aspen property taxes to hold the line?
ASPEN ” Aspen homeowners will most likely not see an increase in property taxes by the city government next year.
The Aspen City Council agreed last week to keep the mill rate levy at 4.799 instead of taking a full 5.41 mills. By not taking the full amount, the city government will credit property owners .611 mills, which is between a 40 and 45 percent decrease from what could have been levied on property owners.
With the temporary tax credit, property owners will pay 4.799 mills, which is about $4.80 for every $1,000 of assessed property value. However, that rate is combined with a .65 mill levy to clean up the Roaring Fork River, which was approved by voters in November 2007.
The rate could have been much more had the City Council capitalized on a windfall in excess property tax revenue as a result of dramatic increases in assessed valuations throughout Pitkin County in 2007.
The city of Aspen is one of 18 taxing districts in Pitkin County that voters have allowed to be exempt from TABOR, a state law that requires government to lower its tax rate when property values rise. When property tax revenues exceed the constitutional limit, those taxing districts, including the city, can choose to keep the windfall, lower the mill levy or provide a temporary tax credit to property owners. When voters set the mill levy rate in 2005, they agreed that it would last until 2010.
They also approved using any excess property tax proceeds to pay for new sidewalks throughout town, stormwater improvements, new hybrid buses, and building an outdoor pool at the Aspen Recreation Center, or ARC.
The pool ” the last of the projects to be completed ” was a topic of conversation among City Council members last week, who were strategizing on how to pay for it. Costs for the new amenity have increased substantially since it was first contemplated in 2005.
Current estimates indicate that the outdoor pool at the ARC will cost $2.6 million ” $563,710 more than the original estimate.
2009 TABOR funds will contribute $900,000 toward the project, and $327,264 will come from 2008’s TABOR funds. The city’s parks and open space fund will contribute $833,000. City officials are hoping a grant from the state’s lottery program will bring in $200,000, a decision that is expected to be known next month, said City Finance Director Don Taylor.
But there’s still a shortfall of nearly $364,000, which could come out of the city’s general fund. As a result, the City Council decided to put the project on hold until early next year to see how the economic downturn affects the city budget.
“Let’s keep the mill levy where it is and wait and see … hold the pool construction until we see the big picture and see what the costs are,” said Mayor Mick Ireland. “The cautious thing to do is keep [the mill levy rate] where it is.”
Tim Anderson, director of the city’s recreation department, said last month that since it’s too late in the season to begin site work for the pool and the economy continues to worsen, holding off is the prudent thing to do.
“For the most part, everything is waiting,” he said, adding there’s a possibility that the pool’s design will have to be curtailed in order to save money. “We have to see what happens with the economy.”
City Councilman Jack Johnson asked why a portion of the funding has to come out of the parks fund. City Manager Steve Barwick said since the pool’s cost is higher than anticipated and the parks department has a surplus, that contribution can help keep the mill levy lower, and might make it more palpable for voters and property owners.
Johnson said a few days before last Tuesday’s meeting that not building the pool isn’t an option.
“I haven’t been convinced that the pool should go away because of a credit crisis or a weak economy,” he said. “Not doing the pools is not an option for me because that is what voters wanted.”
The mill levy must be formally voted on by the City Council, which will occur at a future meeting before the end of the year.
2010 will be the last year that the 5.41 mill levy rate is in effect. By law, the City Council has to set the mill levy rate every year. The City Council will revisit the rate next year and decide whether to credit property owners again, taking into account whether valuations dramatically rise, as they did last year. Those assessments will be based on July 2008 valuations, Taylor said.
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