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Some quick Q&A

Sidebar by Ed Quillen

Salida Scholl Mill Levy Election – November 2001 – Colorado Central Magazine

What’s a mill?

In this context, a mill is the smallest unit of currency in the United States — a unit so small that it has no coin. It’s 1/10 of a cent or 1/1000 of a dollar; think of it as a “millidollar” in the way that a “millimeter” is 1/1000 of a meter, and you’ve got it.

In property tax matters, a tax of one mill per dollar of taxable value is the same as a tax of $1 for every $1,000 of taxable value.

However, it’s not quite that simple, as this example demonstrates. Start with a residence that the county assessor appraises at $200,000 — presumably its actual value if you put the house on the market. Under state law, the taxable value is 9.15% of the appraised value, which works out to $18,300 in this case.

The mill levy is applied to the taxable value, so a tax of one mill on that house would come to $18.30 — 1/1000 of its taxable value. The proposed mill-levy override would currently require about 5 mills, or around $100 a year for this sample house.

The taxable value of commercial property is set at 29% of its appraised value.

What’s a mill levy override?

School finance in Colorado is worse than complicated. But in essence, the state guarantees that a certain minimum amount (about $4,200 currently) will be spent for each Colorado public-school student. The state then calculates how much the school district should raise from local taxes (with poorer districts paying a lesser share than rich ones), and makes up the rest from the state treasury.

If a district wants to provide more money than that minimum, its voters can raise their own property taxes — that’s a mill levy override, and it does not affect state funding, one way or another.

What can this money be used for?

Earlier this year, the legislature passed SB-129, which allowed school districts to hold mill levy override elections for cost-of-living pay increases. Despite what you may have read in a recent Denver Post editorial, though, this is not one of those elections.

“This is just a plain mill levy override,” said Tom Massey, chairman of the Salida school board, “with the money dedicated to a specific purpose — to bring our pay scale up to what it should be.”

Both Massey and Jim Wilson, Salida superintendent, said the money from the override will go only to improving pay and benefits for current positions.

Thanks to the way the ballot question is worded, override money cannot be used to add staff or programs.

At some point the district might add personnel or programs, but that funding would have to come from some other source than the override — such as the increased state funds which will be available due to Amendment 23, which passed last year.

What is Amendment 23?

Amendment 23 requires the legislature to increase per-student state school funding by the inflation rate plus 1%.

The problem with saying how much more this will mean for local school districts is that we don’t know what the legislature would have done without Amendment 23. In previous years, the legislature has increased school spending, but it has not kept up with the inflation rate.

If the legislature had increased school funding at the inflation rate in the past, however, Colorado’s districts would be millions of dollars ahead today. The Colorado Department of Education and the state’s Joint Budget Committee have extrapolated what the difference would have been in the past and come up with some projections.

If inflation continues at expected rates and enrollment remains stable, then Amendment 23 should provide about $4 million in increased revenue for Salida schools during the next decade. The increased funds would start at about $125,000 in the 2001-02 school year, and rise to nearly $800,000 in 2009-10. These are pretty big “ifs,” though, and the actual amount of funds won’t be known until each year’s inflation rate and enrollment stats are in.