A first-of-its-kind proposal in Colorado to grant local governments the ability to tax vacant homes, sometimes referred to as a “ghost tax,” was rejected by a legislative committee on Monday. But that doesn’t mean the concept won’t manifest another day.
Residential vacancy taxes are both novel and controversial, and communities facing extreme housing shortages and affordability challenges are weighing them as a tool that can put more second homes on the market, while also generating tax revenues to fund affordable projects.
Supporters argue that communities should disincentivize the stock of empty and vacation homes, especially when potential residents and workers are struggling to find their first home or apartment.
Counties, school districts and special districts have the authority to levy property taxes, generating revenues whether homes are occupied or empty. Home rules cities in theory
HB26-1036 died in committee, but not after a robust debate on its merits and dangers from a host of supporters and detractors.
When vacation and second homes make up a large share of the housing stock
But it wasn’t only the ritzy communities. XX for.
About 23 of Colorado’s 64 counties would have met the 25% threshold proposed in the amendment, according to an analysis
Vacant homes are much less of an issue along Colorado’s Front Range. In metro Denver, about 4% of housing units are vacant.
Titone and Velasquez, in an effort to head off opposition from more populated areas, Titone and Velasquez amended their bill to set a limit authorizing vacancy taxes only in jurisdictions where 25% or more of homes are vacant.
Some governments would rather see them occupied and rented out.
About six in 10 of the homes in Summit County sit empty much of the year, while the ratio is closer to 55% in Pitkin County and half of homes in and
Lining up on the support side were the Colorado Municipal League, the Colorado Association of Ski Towns and elected officials in mountain resort communit
ies with severe housing shortages, who say vacancy taxes can disincentivize empty homes while helping to fund affordability programs. Any tax measures would have still required approval from local voters.
“We’re talking about Aspen, Vail, Telluride, where we have $20, $30 million mansions,” said state Representative Elizabeth Velasco of Glenwood Springs, an HB-1036 sponsor. “This is something that rural communities have seen — that our local workforce and local communities are not able to afford to live where they work.”
But three Democrats on the Colorado House Finance Committee — representatives Sean Camacho of Denver, Rebekah Stewart of Lakewood and Bob Marshall of Highlands Ranch — joined Republicans to kill the measure on a 7-4 vote after its first hearing Monday.
Colorado Municipal League, the Colorado Association of Ski Towns and a host of elected officials in mountain resort communities with severe housing shortages, who say vacancy taxes can disincentivize empty homes while helping to fund affordability programs. Any tax measures would have still required approval from local voters.
“We’re talking about Aspen, Vail, Telluride, where we have $20, $30 million mansions,” said state Representative Elizabeth Velasco of Glenwood Springs, an HB-1036 sponsor. “This is something that rural communities have seen — that our local workforce and local communities are not able to afford to live where they work.”
But three Democrats on the Colorado House Finance Committee — representatives Sean Camacho of Denver, Rebekah Stewart of Lakewood and Bob Marshall of Highlands Ranch — joined Republicans to kill the measure on a 7-4 vote after its first hearing Monday.