Denver businesses will be hit with a double-digit property tax increase after voters approved Measure 2A and a $466 million dollar bond issue for public schools.
Measure 2A allows Denver to keep $68 million a year that was normally returned to taxpayers because it's above the limit imposed by the Taxpayer Bill of Rights (TABOR). It's called "de-Brucing" in reference to Douglas Bruce, the author of TABOR.
Commercial Properties Take the Biggest Hit
The passage of Measure 2A and the school bond package creates an effective property tax increase of 14.2 mills for business property owners. That's a 21% increase from current Denver property tax rates.
Commercial property owners must pay proportionally more than residential owners – a split of 55% to 45% as mandated by the state's Gallagher Amendment.
"In short, the owner of a $1 million home in Cherry Creek will see property taxes increase by $1,130 per year, while the owner of a $1 million retail property right next door will incur an additional tax liability of $4,133 per year," explained Tyler Smith, president of the Denver Metro Commercial Association of Realtors.
Opponents say Measure 2A amounts to a permanent tax increase that is going to have a year-over-year impact on all Denver property owners.
Going with the Flow
Denver joins 85% of the cities and counties in Colorado that have already removed their TABOR caps. Mayor Michael Hancock said de-Brucing will eliminate Denver's budget deficit and help restore essential services lost to budget cuts over the past four years.
City officials say they will use the additional tax revenues to hire 100 police and fire recruits, repave 300 miles of roads, replace 1,000 city vehicles, restore hours to libraries, and provide residents free access to recreation centers.