The owner of a $518,000 home in Flying Horse Ranch pays $176.29 in property taxes a year to the city, which helps cover city services such as parks and fire protection. But that homeowner also pays another $288 to Donald Wescott Fire Protection District, and another $1,442 to Flying Horse Metro District No. 2, which provides landscaping and other amenities to the north-side subdivision.
Several City Council members want to study if, and how, this kind of dynamic impacts the city.
Special districts, of which there are 280 within El Paso County, fund public infrastructure. They're often formed and issue debt with a vote by the developer alone — before the property is developed and people move in. Incoming residents are stuck paying up to 50 mills to pay off the debt and fund services unique to the development. (A mill is equal to $1 in annual taxes for every $1,000 in assessed value.)
Councilors Jan Martin and Joel Miller are concerned about a disparity in services between those able to pay high special-district rates and those who do not. In addition, they worry that some residents of special districts mistake the high tax rates of those districts with the very low city tax rate of 4.279 mills, and that they'll be inclined to vote against potential city increases because they're already paying so much in special districts.
In addition, taxes paid on motor vehicles have a link to property tax collections, so the proliferation of special districts has the effect of siphoning off motor vehicle taxes the city should receive, city planner Carl Schueler told Council on Monday.
While there's not much Council can do about districts that are already formed, Miller and others think it's a good idea to better understand, and perhaps better regulate, special districts. In many cases, Council approves formation of the districts and their annual budgets, but provides little, if any, oversight into actual operations and financial accountability.
"There's not enough clear guidance," Miller says. "There's not enough information."
Council seemed to reach consensus Monday that a task force will be formed to further investigate special districts, their accountability and the Council's authority over them. A white paper produced in 2009 by the city's comprehensive planning division will be vetted and updated before being provided to Council, Mayor Steve Bach's chief of staff Laura Neumann said.