In this new series, we’ll answer some of your frequently asked questions on how things work in our library.
Q: How are libraries funded?
The main source of revenue for libraries that are special districts, like we are, is property taxes.
Here are how property taxes are calculated in the State of Colorado:
Property Taxes = Assessed Value x Mill Levy Rate
The state arrives at your assessed property value by taking the value of your property multiplied by the assessment rate (currently 7.15 percent).
Now in Colorado, there are two major items at play: TABOR and Gallagher (see right sidebar). Gallagher outlines that a specific ratio must be maintained — a 45 percent residential and 55 percent non-residential split — so homeowners pay proportionally less when home values grow faster than business values.
The Colorado Fiscal Institute illustrates exactly how this works in the short video below.
Mill Levy Rates
With TABOR in place, all tax increases (increases in mill levy rates) must be approved by voters. Our mill levy rate is 3.546, and has been at that rate since 2001. Our library district does not have any debt — the Third Street building was paid off early in 2011 — so, the 3.546 mill levy is considered an “operational” mill and will continue at that rate unless there is a voter-approved change.
If you have any questions on library funding, please give us a call at 970-686-5603. If you have a question you would like featured in the How Does It Work? series, email Communications Specialist Katie Messerli.
TABOR (Taxpayer Bill of Rights, 1992)
State and local governments cannot raise tax rates without voter approval and cannot spend revenue collected under existing tax rates if revenue grows faster than the rate of inflation and population growth, without voter approval.
Impacts how much homeowners pay in property taxes. When home values grow faster than business values, homeowners pay proportionately less to maintain the 45 (residential) / 55 (non-residential) split.