Castle Pines, CO

Castle Pines officials: Sales tax hike, mill levy transfer needed

Mike McKibbin
Photo byCity of Castle Pines

By Mike McKibbin / NewsBreak Denver / Aug. 25, 2023

[CASTLE PINES, COLO.] — Castle Pines voters will likely decide two ballot measures in this November's general election. City officials held a telephone town hall Thursday night to help explain the need for the measures and answer questions.

Mayor Tracy Engerman and council members Roger Hudson and Chris Eubanks explained why the city plans to ask voters to approve a 1% sales tax for road repairs, maintenance and improvement projects, and a parks mill levy transfer from local special districts so the city can manage public parks, trails, recreation, and open space.

General fund only current road money source

The city does not have a dedicated funding source for road improvements, as the city's 4.5 mill property tax money goes to the Douglas County Sheriff’s Department for public safety services.

"Having a reliable source for our road needs is absolutely critical," Engerman said. "We can't continue to grow our maintenance backlog on roads that were built 30-40 years ago and maintenance was maybe paused until the city incorporated" in 2007.

The city now uses some of its general fund money for road purposes, but more is needed to meet current or future needs, Engerman added.

Hudson noted the city "always asks" the Douglas County Commissioners to use more of the county's motor vehicle registration fees paid by Castle Pines residents to help pay for the roads that run in both the city and county. However, the city has not been successful.

Other areas benefit; visitors help pay road tax

Eubanks said the estimated $3.3 million a year the sales tax would generate can only be used for city road needs, freeing up general fund money for other uses.

"If it doesn't pass, we won't have any money for anything more" on city roads, he added.

Engerman noted developers pay various fees and would also pay more use tax revenue to the city since the tax hike affects sales and use taxes. She added online purchases made by city residents and businesses would also pay the 1% tax increase.

Hudson said along with road improvements, the money would help make Castle Pines more walkable. Eubanks said sidewalks, curbs and gutters would be improved.

He also said the city used focus groups to help develop the sales tax rate.

"We looked at going higher than 1% but we want this to pass and a higher tax is more likely to be voted down," Eubanks added. "At 1%, for every $100 spent, the tax is $1."

Engerman said the city wants a sales tax increase instead of a property tax hike because visitors who stop and make purchases in Castle Pines will help generate money for the roads they drive on.

Homeowners currently pay the city a 4.5 mill property tax, but all of that funding goes directly to the county for public safety services. Even with this new tax, Castle Pines' 7.75% sales tax would still be the lowest rate among county municipalities.
Elk Ridge Park in Castle Pines.Photo byCity of Castle Pines

Mill levy transfer not a tax hike

The parks property tax mill levy question seeks voter approval of a transfer of money from local metropolitan districts. Those districts would permanently reduce 12 mills of their property tax rates. The city would collect 12 mills of property tax money for public parks, trails, recreation and open space.

Eubanks stated the required ballot language will ask if property taxes should be increased, but approval will mean "the vast majority of residents will see nothing new since it's just a transfer."

Hudson noted exceptions are in the North Pine Vistas Metro District, where homeowners pay into two metro districts and would have a net decrease of 12 mills. Because homeowners in Hidden Pointe do not currently pay property tax for parks, trails, recreation, and open space, they would see a 12-mill increase if this measure passes.

By approving the transfer, all public parks management would be under a single contract with the city, allowing more efficient management of contracts and amenities.

"It will be better economies of scale," Eubanks said. "And there will be consistent levels of services in all our parks, open space and trails."

Fact sheets and more information on both measures are available online.

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