Aspen Valley Hospital won’t collect property tax windfall
October 13, 2009
ASPEN – Aspen Valley Hospital will forego a $1.2 million windfall in property tax revenue next year, its board of directors unanimously decided Monday.
The hospital district was in line to collect the additional money thanks to a 34 percent increase in property values before the bottom fell out of the local real estate market. Board members, however, quickly agreed the hospital should slightly reduce its mill levy for a year so as not to take in the additional revenue.
The hospital will adjust its levy in order to take in about $3.5 million in property tax revenue, which is what it collected this year. Colorado statutes allow districts to use a temporary tax credit to lower their mill levies for one year, then have them return to the prior level.
Several board members noted the hospital has done reasonably well, financially, this year – employees received raises, pointed out Dr. Barry Mink – making it possible to forego collection of additional property taxes at a time when many in the community have lost their jobs or have seen their wages reduced.
“It doesn’t seem fair to tax them more while we are doing well,” Mink said.
“It’s the prudent thing to do,” agreed board member Chuck Frias.
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The $1.2 million equals about 2.8 percent of the hospital’s current cash reserves, said CEO David Ressler.
“It’s not a sizable amount of money in terms of our overall financial picture,” he said. “But we take every dollar very seriously. It’s real money.”
Various taxing districts are expected to take a close look at their mill levies this fall, given that some of them have received voter approval to exempt themselves from state limits on the amount of additional money they can take in as property values rise.
The county assessor’s re-evaluation of property was based on surging property values for two years before June 30, 2008 – the cutoff date mandated by the state. Residential and commercial property owners saw their property values subsequently drop, but fear their property tax bills in 2010 could soar if taxing districts that are allowed to keep the windfall choose to do so.