Commercial property and business owners will receive a break in their property taxes during the next two years as a result of the latest the biennial reappraisal of properties in La Plata County. Sponsored by The Payroll Department and Kroegers Ace Hardware.
Commercial property and business owners will see a decline in property values and in the amount they pay for property taxes this year as a result of the pandemic. You're watching the Local News Network brought to you by Kroeger's ACE Hardware and The Payroll Department. I'm Wendy Graham Settle. You may have received your official notice of property value from the La Plata County's assessor's office this month to let you know how much your residential property values increased or your commercial property values decrease this year. Yes, commercial property owners and businesses will see a drop of anywhere between eight and 40% in the value of their properties as determined by the biennial reappraisal in 2021. County assessor, Carrie Woodson, says the drop in property values will mean a drop in the amount of property taxes. Commercial owners pay - at least for a couple years.
And so what happened with COVID is that we saw that there was a definite decline in commercial property because of the shutdowns. There was a group of assessors, Front Range, and a couple of the mountain counties who went together and did a report that said, "What is the effect of COVID on the commercial market?" And they did find there was an effect. I also did a similar study here in La Plata County where I looked at sales tax. I looked at, of course, the sales that were occurring. I talked to different realtors, business owners, property owners, commercial realtors, et cetera, and looked at vacancy rates, declines in income. And what we did is we came up with a group of properties that were affected by COVID.
Colorado law requires county assessors to reappraise the value of all property within their jurisdictions every two years. Property values are based on sales and the values determine how much in property taxes you'll pay. The value is multiplied by the assessment rate and that value is then multiplied by the total amount of the mill levy assessed on your property to generate your tax bill. The tax mill levy includes county property taxes, as well as levies from school districts, fire protection districts, library districts, and other special service districts depending on where you live. Unlike commercial properties, residential property values rose from 6% around the Ignacio area to more than 20% in the Edgemont area as a result of the high demand for housing in tight market.
What we do is we look at those sales that occurred during that timeframe and we look at the difference in what they were valued at last time and that is a percent change, either up or down. Then we apply that percent to other like-kind properties. So for instance, we'll go neighborhood by neighborhood, area by area, looking at the sales that occurred and then adjusting the non-sold and sold properties so that they are all adjusted the same.
If you think your property has been appraised at too high a level you have until June 1st to challenge the reappraisal with the assessor's office.
Every time you get a notice of value from us you have the rights protest that. We are in protest right now. The month of May is what we call protest period. And so you have the right to either contact us via the mail, email, online, you can pick up the phone and call us and tell us you don't agree with either the valuation, the classification, or the inventory that's involved in valuing your property. Now, when you come in and you protest your value we tend to go more to what we call the fee-appraiser mode. We'll be looking for three comparables to see if the value on your property is correct or not. If it's not correct, we're happy to adjust it.
Although commercial property owners will see a drop in their property taxes, Woodson warns that it won't last long. This past spring, the Strater hotel sold for $13.4 million and the Rochester hotel for nearly $3 million. Both showed significant increases in value over the previous appraisal cycle. In addition, commercial condos are continuing to sell well in downtown Durango.
What we're seeing right now in the market is that commercial properties are selling and they're selling for an increased value. So we're already seeing the rebound.
If you'd like to know more about the methods used to calculate your property taxes, or to register a protest, visit the assessor's page on the La Plata County website at co.laplata.co.us. Thanks for watching this edition of the Local News Network, I'm Wendy Graham Settle.