There won't be any reductions in taxes or fees for Castle Rock residents and developers — at least not in the near future.
“If it ain't broke, don't fix it,” said Castle Rock Mayor Paul Donahue, after hearing a staff report July 2 on possible tax-reduction options that he felt could have minimal benefits for taxpayers, but potentially major impacts on the town's budget.
Council members agreed with him to wait and revisit the tax-reduction topic in possibly six months or next year.
Results of a recent survey of Castle Rock residents showed a strong satisfaction with town services, but also showed some interest in tax and fee reduction, particularly in water rates, Castle Rock Town Manager Mark Stevens said at the council meeting.
Stevens, presenting the staff report, said the town currently has the lowest property tax in the south Denver metro area — so reducing the property tax rate 10 percent would only mean a $4 reduction for $300,000 house.
He said the town's strategy has been that it can keep property taxes low by getting more of its revenue from sales tax, much of which is generated from non-residents shopping at the Outlets at Castle Rock and other businesses.
The town's 4 percent sales tax is on the higher end, but “that's intentional,” Stevens said.
Stevens said sales tax is the town's largest source of income and cutting it would have the “biggest financial impact to the town.”
Regarding various town fees, most are tied to the direct cost of providing a service, Stevens said.
Some council members expressed interest in looking into ways to tweak the town's water utility bill. Water users pay a fixed amount, $52, which is set at that rate to pay the costs of the water system, and in addition, they also pay a variable amount based on usage.
“I've always wished for some way of taking care of fixed-income people,” said Councilmember Joe Procopio. “Water is a necessity …”
Donahue said he thinks officials need to focus on the big picture of what's happening in the town. Donahue referred to the costs of ensuring the town's future water needs and other large projects, and said he didn't think a majority of residents would mind not having a minimal tax cut if the town continues to spend the money wisely. He said he worried that cuts might not have a significant impact now, but may down the road.
He said he's not hearing an outcry from residents about taxes and fees, and also had another priority in mind.
“If we have money available, let's replenish reserves. … Let's make sure we've got money for that,” he said.