With the new property tax assessments coming out, there has been a lot of discussion about not only property values, but also property tax amounts. You may have heard of, or be living in, something called a Metro (Metropolitan) District that is one of the entities that you pay property taxes to. There are several type of Special Districts in the Carbon Valley area ranging from Fire, Library, or Recreation to Metro Districts.
In recent years, many new developments have been done using a Metro District as a development tool to finance the development of the subdivision. Basically, instead of the developer putting up the money to put in infrastructure such as utilities, sewer lines, streets, etc., a special taxing district is formed to finance those improvements. Then, those costs are paid for over time through property taxes rather than in the lot or home price. So, theoretically, you are purchasing the new home for a lower price because you are paying for the development over time through the Metro District.
Because of problems with Metro Districts in the past, they are now limited to the number of mils they charge. Many of the districts in the area are in the 40 to 60 mil range, but I’ve seen as high as around 80 mils. Sometimes, the mil levy also takes care of things other than infrastructure such as open space, common areas or other amenities for the development. In that respect, they are kind of operate similar to an HOA, but they are structured differently.
To give some perspective, most areas within Frederick, Firestone and Dacono that don’t have Metro Districts, have a mil levy rate of about 100 mils. Within a Metro District, that total mil levy is around 150, so that is why the property taxes are higher. If two homes have the same assessed valuation, the property taxes for the one not in the Metro District would be about 33% lower.
If you want more information, the State of Colorado’s Department of Local Affairs (DOLA) has published Special Districts: A Brief Guide for Prospective Homeowners. Give me a call and I’ll email you a copy.