GCLD Board of Trustees discusses the implications of the Gallagher Amendment on financial planning for the library
For those Grand County residents who follow the board meetings of the Grand County Library District, it may come as no surprise to learn that during the January session, the trustees reviewed the possible effects of the Gallagher Amendment on upcoming library budgets.
The Grand County Library District, together with all rural Colorado Special Districts is facing an unexpected challenge – a decrease in revenues from property taxes due to the Gallagher Amendment.
The financial outlook for special districts, including library districts in Colorado, is largely based on the rise and fall of the local residential property market. During a legislative session in 2017, the Residential Assessment Rate (RAR), was lowered from 7.96% to 7.2%, pushing the tax burden to the commercial sector.
Along the Front Range, where there has been a significant rise in home values, most residents will likely see their property taxes grow. The implications for rural Colorado, where home values are growing more slowly or not at all, are very different.
It is anticipated that the 2019-2020 tax appraisal cycle will see further adjustments to the RAR, bringing the rate down further to 6.11%.
The Special District Association who assist in representing the legal and political issues facing special districts, calculates that a reduction of this magnitude will automatically take over 15% from property tax revenues for special districts in Colorado. This including libraries, hospitals, schools and fire protection districts.
“We have a little time to develop a comprehensive response,” says Jim Sloan, GCLD Board of Trustees. “Although we are expecting to see some increase in the Grand County residential property valuations which may help to offset the anticipated loss, we cannot afford to be complacent.”
In 2018, the Grand County Library District is operating under a flat budget while making every effort to maximize efficiencies. Sloan believes that, “ongoing careful strategic planning is going to be key to negotiating the next few years. The library district is currently in the process of developing a five year plan”.
“Our main objective is to maintain library services in all our buildings” added Sloan “To do this the library district must operate efficiently and use our revenues with a long-term perspective and sustainability in view. We will be prioritizing and reviewing all our projects and using staff time very thoughtfully”.
Together with a conservative approach to the budget in 2018, GCLD is reviving the Grand County Library Foundation tor raise donations and decrease the dependency on property tax revenues. Donations made to the Library District will play an essential part in supporting and sustaining valuable library programs and collections into the future.
On January 11, Governor John Hickenlooper, commented on the effects of Gallagher during his final state of the state address to the Legislature, suggesting that the Amendment can potentially harm rural communities’ ability to pay for essential services.
The growing urban-rural divide and Gallagher is also among the top issues to be discussed during the 120-day session of the Colorado General Assembly. Look out for more information as the discussion moves forward.