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Amid the furor over dramatically increased property valuations and taxes for 2023, it was brought to my attention that a simple search of the Pitkin County (PitCo) Assessor’s website by local political apparatchik of one’s choosing demonstrates notable DECREASES in their (deed restricted housing) property tax bills for the same period. Here’s a subset of the sample that was shared with me:
1. City manager Sara Ott owns a Water Place home. 2022 actual value was $249,000, and that decreased 22% to $194,000 for 2023. Her taxes for 2022 were $634.60, and that decreased 38% to $391.40 for 2023.
2. Aspen community development director Ben Anderson owns a 550 Employee Housing Fund Condominium. 2022 actual value was $196,800 and that decreased 28% to $141,800 for 2023. His taxes for 2022 were $501.52, and these decreased 43% to $286.00 for 2023.
3. APCHA assistant director Cindy Christensen owns a Juan Street unit. 2022 actual value was $320,800 and that decreased 10% to 288,800 for 2023. Her taxes for 2022 were $817.56, and these decreased 29% to $582.56 for 2023.
4. APCHA board member and ACRA exec Alycin Bektesh owns a Benedict Commons unit. 2022 actual value was $171,500, and that decreased 27% to $125,900 for 2023. Her taxes for 2022 were $437.00, and these decreased 42% to $254.12 for 2023.
5. Former mayor and county commissioner Rachel Richards owns a Hunter Creek unit. 2022 actual valuation was $187,800 and that decreased 26% to $139,200 for 2023. Her taxes for 2022 were $478.44, and these decreased 41% to $280.88 for 2023.
6. Former mayor and county commissioner Mick Ireland owns a Common Ground unit. 2022 actual valuation was $152,400 and that decreased 27% to $111,100 for 2023. His taxes for 2022 were $194.12, and these decreased 42% to $112.00 for 2023.
It turns out that the Colorado legislature passed SB 23B-1 in November that reduced residential assessment rates for 2023 from 6.765% to 6.7%, and exempted Colorado homeowners from the first $55K of their home’s value for taxation. Still, with APCHA’s numbers all over the board, it’s diffficult to determine how the 2023 valuations were determined.
When queried about this unusual scenario, APCHA pointed to “appreciation” (3% or CPI, whichever is less, annually) for what created the differentials, until another example was presented that does not appear to have taken appreciation into account. In short, it’s simply impossible to verify APCHA’s math:
“(County commissioner) Kelly McNicholas-Kury owns a Burlingame II unit. Its 2022 actual valuation was $254,000 and that decreased 14% to $217,600 for 2023. She bought this unit on 8/23/2021 for $266,619, so this unit has lost about 20% of its value since closing. Her taxes for 2022 were $647.08, and these decreased 32% to $438.96 for 2023. Where is the appreciation?” Same with Sara Ott’s above. To the knowledge of The Red Ant, this inquiry was never addressed.
This entire curious revelation illustrates a legally problematic reality and systemic deficiency for how the county allocates the local property tax burden. For assessment purposes, free market property valuation is determined by what a new owner would pay in the current market, in other words, “the market approach.” APCHA and other deed restricted properties, on the other hand, are valued based on an owner’s basis in his/her unit – what they originally paid for it. Using this methodology, since deed restricted properties infrequently change hands, in addition to the original public subsidy, the property taxes on deed restricted properties are further subsidized forever, even as property taxes on free market properties soar.
This ongoing shift of the local property tax burden from the deed restricted sector to the free market sector is not only unfair, it is also illegal.
It’s important to understand just how PitCo’s deed restricted properties are actually valued today. It’s simply mind-boggling. While the county assessor is required by law to value all real properties every two years (CRS 39-5-101), for deed restricted accounts, her office is merely “given” property valuations by third parties: Snowmass Village, Basalt, City of Aspen, APCHA and Habitat for Humanity! And no, the assessor’s office does not verify any of this info; it just takes the submitted data and uploads it into the system.
This current system for deed restricted properties relies on a “savings account” approach to valuation where each individual deed restricted property has its own accrued valuation account that reflects its individual cost basis and appreciation over the period of ownership. The complexities of this approach are surely where many errors originate as the examples above show how the methodology is unevenly applied. Plus, this approach is inconsistent with the law (CRS 39-1-103.5) which states, “The actual valuation of residential property shall be determined solely by consideration of the market approach to appraisal.” The market approach reflects what a willing buyer would pay. And in APCHA’s case, such prices are set. It’s very straightforward and there would be zero additional burden to the assessor’s office to use these figures.
The assessor cites APCHA’s position that its Intergovernmental Agency (IGA) status gives it the authority to value deed restricted properties, but in reviewing this IGA as well as Colorado law (CRS 29-1-204.5) that enables housing authorities, there is NOTHING that takes statutory valuation authority away from the duly elected county assessor and gives it to APCHA! (Furthermore, how can it be legal to delegate such responsibility to a non-governmental entity such as Habitat for Humanity?)
A fellow co-conspirator obtained the property valuation data submitted by APCHA for the current billing cycle and dug in, discovering many, many errors, including errors of omission. The APCHA data showed 1654 units when the assessor’s website cites 2132 units, a difference of 478. (Once this was brought to the attention of the assessor, most were identified but there are still some units that are accounted for.)
According to an email exchange shared with The Red Ant, the assistant county attorney defends Pitco’s practice, despite its clear illegalities, despite refuting APCHA’s assertion of authority that it doesn’t have, stating that the system has been used “for many years,” as if that makes it okay. He also says accepting third party data is purely at the assessor’s discretion. The assessor, Deb Bamesberger, on the other hand, feels that her hands are tied – a clear reflection of the power APCHA wields not only over those in its program, but also over various city and county departments. It’s time to sort this out.
Deed restricted property valuations are NOT being conducted by the elected PitCo assessor as required by law! It is entirely unfair for the assessor to have to accept third-party work product and use it to determine property tax billings. She currently has to sign off of these assessments and represent to voters that she did her job, despite not verifying any of the information she has been given. Just say no! Pitco assessor Deb Bamesberger, stand up for yourself and for the voters who elected you! Do not let APCHA bully you and dictate anything pertaining to property values!
As you might imagine, the state requires an audit of property valuations, however, the assessor clarifies that the state only reviews select free market accounts. There is zero quality control because the deed restricted data is not audited by anyone. So it’s true, there are indeed two systems for property valuation: one for the free market and another for deed restricted properties. Are you actually surprised?
Today with PitCo deed restricted property valuations, we are effectively operating within a “garbage in, garbage out” structure, where the system is only as good as the data received from third parties. It’s time to make some fundamental changes that are far simpler than one might imagine. And legal!
To begin with, the assessor needs to assert herself. If the county attorney says the current system is in place at her discretion, well then, demand a change. Refuse to accept third party data. And c’mon BOCC, how about standing up for your fellow elected official in the name of following the law and demonstrating transparency to your constituents!
Next, change the methodology and adhere to the law. The market approach to property valuation is the only acceptable and legal method of property valuation. Period.
Two identical 2-bedroom units at Burlingame 2 of the same category under a market approach would have identical valuations based on the current set price for these units. But the savings account approach would yield different valuations that reflect the individual owners’ purchase price and accrued appreciation. This is wrong on too many levels to list, and serves to artificially keep property tax bills low (and often decreasing) while shifting more and more of the tax burden onto the free market.
It’s time to put APCHA on notice that its rogue ways must end. The chronic lack of transparency and toxic “it’s always been done this way” mentality only further serve to discredit the corrupt entity, not that its reputation could get much worse! And I’m talking to you, city manager Sara Ott. Making APCHA into a city department and managing the APCHA executive director as a direct report is proving to be a fatally failed model that will be the housing program’s undoing.
On a positive note, Assessor Deb Bamesberger is no APCHA apologist. She was elected to her position in 2018 and re-elected in 2022. Keep in mind that she defeated Mick Ireland (62% - 38%), whose potential reign of terror and the havoc he would have created in this role cannot be understated. It’s imperative that we support Deb as she too uncovers and addresses more “it’s always been done this way” BS in her own office and works to make the necessary improvements. In this case, there are 18 months before the next property valuations are due. Again, it’s an easy fix and it’s incumbent on all of us to encourage and support Deb in her efforts to clean up this mess. Encourage her via email HERE(assessormail@pitkincounty.com).
One more related thing for Deb to clean up regarding APCHA over-stepping its authority: amid the revelatory “Torre-and-APCHA-cheated-to-give-him-housing” saga, I learned that the assessor’s office only records the sale price of APHCA transactions, not the purchase price. For example, since APCHA takes momentary ownership in the chain of title when units trade, the price APCHA pays the seller is always left blank in official records, yet the buyer’s purchase price is listed. When I asked why, guess what I was told? Yep. “It’s always been done this way.”
What is APCHA hiding? I can imagine that, with simple annual appreciation of 3% or CPI – whichever is less, it’s entirely possible that APCHA is buying units for one price and then re-selling them at the unit set price which could actually be less. This “gap” is not currently visible to the public due to the lack of full and proper disclosure, making it impossible to know how APCHA is hiding or manipulating its finances, and might just be yet another public subsidy we were not previously aware of.
Clean this up! In the name of transparency, the assessor must cease accepting incomplete property transaction data from APCHA immediately and transition to a cleaner, simpler and more transparent “market approach” to deed restricted property valuation that is easily accessed and verified.
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May 23