Douglas County loses bid to revive its creative $28 million property tax relief plan

Douglas County won’t be able to deploy its creative attempt to offer a $28 million property tax break to homeowners after a Denver judge this week declined to overturn a state board’s decision blocking the relief.

Denver District Court Judge Ericka F. H. Englert ruled Wednesday that the State Board of Equalization’s decision was “properly considered” and thus valid. The bulk of Douglas County’s lawsuit had already been rejected last year.

The Douglas County Commission voted in September 2023 to reduce the county’s residential property valuations by making an across-the-board reduction in single-family home, townhome and condominium values that had been determined in May of that year.

Property valuations, which are calculated every two years in Colorado, are a key factor in determining how much a homeowner pays in property taxes. A lower property valuation translates to a lower property tax bill.

The county’s board of equalization is supposed to correct errors in property valuations, not make property tax policy. But the county’s assessor said the reduction was justified because housing market conditions were fluctuating in June 2022, when the valuations were dated. 

When the State Board of Equalization reviewed the value reduction in December 2023, the panel said the reduction was unwarranted and expressed anxiety about how approving the change could set a precedent for other parts of the state. They also worried about how the decision could deplete state finances by requiring that more money be routed to schools in Douglas County.

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There are some 300 local districts in Douglas County whose revenues would have been affected by the change.

Douglas County experienced one of the largest spikes in property tax bills across the state last year after property values jumped across Colorado.

Douglas County sued the State Board of Equalization in early 2024 in an effort to revive the property tax relief plan, alleging the board didn’t have the authority to block the tax break and that it didn’t follow Colorado’s open meetings laws when it did so.  

Englert rejected those claims, finding that the state board acted within its authority when it rejected Douglas County’s valuation reduction.

Douglas County hinted that it may try to appeal Englert’s ruling.

“The fight isn’t over,” the county said in a news release. “Douglas County commissioners are exploring every legal option to defend taxpayers and restore fairness.”