2023 Mill Levy (collection in 2024)

Colliers Hill Metropolitan District No. 2 (the “District”)

Terminology:

• Mill: one mill is equal to 1/10 of a penny or 1/1000 of a dollar.  Mills are used to calculate property taxes using the following formula: Mills x Assessed Property Value = Property Tax.

• Assessed Valuation (AV): the assessed property value is the actual value of property within the District multiplied by the assessment rate.  The annual assessment rate is set by Colorado statute. 

Background:

• In 2007, the Town of Erie approved the District and authorized it to impose a maximum mill levy of 50.000 mills, subject to adjustment to the extent the annual assessment rate changes as it was 7.96% at that time.

  • Since January 1, 2008, annual assessment rate changes have resulted in adjustments to the maximum mill levy.  Most recently, in November 2023, the State Legislature held a special session and lowered the 2023 annual assessment rate from 6.95% to 6.7% for residential property, plus it reduced actual value of a home by $55,000.  Due to these changes, the District’s 2023 adjusted maximum mill levy is 62.658 mills (the “Adjusted Maximum Mill Levy”).

• In 2017, the District issued its Series 2017 Bonds (the “2017 Bonds”) to fund the construction of public improvements.  As part of the debt issuance, the District agreed to repay the principal and interest on the 2017 Bonds by imposing a general tax on the taxable property within the District.

• In 2022, the District refunded the 2017 Bonds and issued debt in the form of refunding bonds (the “2022 Bonds”).  The repayment of the principal and interest on the 2022 Bonds is facilitated through the imposition of a general tax on all taxable property within the District.  The 2022 Bonds require that the District impose a debt mill levy of 50.000 mills, as adjusted to account for changes in the assessment rate.  As a result of the various assessment rate changes over time, including the most recent 2023 assessment rate change, the District’s current required adjusted mill levy (i.e. the 2023 mill levy collected in 2024) is 62.658 mills (the “ Required Debt Levy”), minus any mill levy imposed to fund the operation and maintenance of the District (the “O&M Levy”).  Based on the terms of the 2022 Bonds, the full amount of the Required Debt Levy must be imposed until the amount collected is sufficient to fully pay all the principal of, premium on, if any, and interest on all of the 2022 Bonds.

• Additionally, the full amount of the Required Debt Mill Levy must be imposed until the Surplus Fund for the 2022 Bonds reaches and remains at the Maximum Surplus Amount of $1,599,500.  The Surplus Fund has a current balance of $480.

• Until the District is able to make full debt service payment on all of the 2022 Bonds and the Maximum Surplus Amount is reached, the District does not have any discretion to reduce the Required Debt Levy despite the rise in property values and resulting increase in assessed valuation within the District. 

• The Board of Directors of the District (the “Board) inquired about lowering the Required Debt Levy at the 2024 Budget hearing.  However, the District has not reached the point where revenues from the Required Debt Mill Levy are sufficient to allow the District to lower the mill levy.  Therefore, the Board of Directors was required to adopt the 2024 Budget and impose the adjusted Required Debt Levy of 60.478 mills. 

• The District’s 2023 total mill levy (for collection in 2024) is 62.658 mills (consisting of 60.476 mills for debt and 2.182 mills for general operating and administrative expenses).