An important property tax measure will be decided with Colorado’s November election. Amendment B seeks to do away with the Gallagher Amendment, which was adopted by voters in 1982.
Gallagher requires that 55% of taxable real estate value come from commercial property owners and residential property covers the remaining 45%. An accompanying piece of legislation would require the state legislature to freeze current tax assessment rates if Amendment B passes and Gallagher is repealed.
Maintaining the 55-45 Split
Along with requiring the 55-45 split, Gallagher locked the assessment rate for commercial properties at 29% of the property’s value.
Shortly after the law went into effect, the residential assessment rate which had been 30% was lowered to 21%. It currently stands at 7.15% and is expected to decrease further in 2021 if the vote to repeal Gallagher fails.
A bipartisan group of legislators pushed for the repeal of the Gallagher Amendment. The group argues that Gallagher hurts rural areas that rely more heavily on residential property taxes.
“If Gallagher is not repealed and we don’t vote yes on Amendment B, we’re looking at 10-15% cuts for rural fire districts, hospital districts, and EMTs that rely on property taxes,” explained State Senator Chris Hansen.
Opponents of the repeal say Gallagher is the only property tax break homeowners have and the loss of it during the COVID-19 pandemic could be devastating. A group called Protect Our Homes wants the state to find other ways to help districts that are struggling to make ends meet.
The group sued the state legislature in September, alleging that last-minute changes to the language about Amendment B in the Blue Book amounted to propaganda in favor of the repeal of Gallagher. A judge dismissed the lawsuit.