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Home My WebLink AboutWORK SESSION SUMMARY-03/08/2022-Work Session City Manager’s Office City Hall 300 LaPorte Ave. PO Box 580 Fort Collins, CO 80522 970.221.6505 970.224.6107 - fax fcgov.com MEMORANDUM Date: March 11, 2022 To: Mayor and City Councilmembers Thru: Kelly DiMartino, Interim City Manager Kyle Stannert, Deputy City Manager Caryn Champine, Director of Planning, Development & Transportation Paul Sizemore, Director, Community Development & Neighborhood Services From: Sylvia Tatman-Burruss, Senior Policy & Project Manager Re: March 8th Work Session Summary: East Mulberry Project Update At the March 8th City Council Work Session, staff provided an update on the East Mulberry Project. Staff began by presenting the updated project timeline and the history of annexation in Fort Collins. Staff presented an update on community engagement thus far, goals for the East Mulberry Plan and strategies to achieve those goals. Finally, staff presented the strategy for the potential annexation decision-making framework and the proposed discussion items for the joint City Council and County Commissioner meeting on April 13th. Staff presenters included Travis Storin and Sylvia Tatman- Burruss. All Council Members were present over Zoom, except for Councilmember Peel. General direction and discussions from the work session included: Update to the East Mulberry Plan and Annexation Phasing x General support to continue the potential annexation analysis and formation of 4 potential annexation phasing scenarios to bring forward for discussion at a Work Session on April 26th x Discussion regarding benefits of annexation and how to balance the pros and cons x Discussion regarding the Triple Bottom Line decision-making framework and how to clearly articulate the assumptions and timing in the forthcoming scenarios x Interest in taking time for thorough analysis and revisiting refined scenarios in late 2022 x A question was asked about valuation of agricultural land upon annexation and rezoning. A handout is attached from the Colorado Department of Local Affairs to explain this issue Joint Meeting with City Council and County Commissioners x Desire to focus on shared goals and priorities around the potential annexation x Desire to discuss expectations, timing, and resources Next Steps x Continue scenario development for potential phased annexation and present scenarios at the April 26th Work Session x Gather information from previous annexations, especially the Southwest Enclave annexation and lessons learned from that process CLASSIFICATION For property tax purposes, land must meet one of the following five requirements to qualify for agricultural classification: 1. A parcel of land that was used the previous two years and is presently used as a farm or a ranch, or is being restored through conservation practices. Such land must have been classified or eligible for classification as agricultural land during the 10 years preceding the year of assessment. Agricultural land includes land underlying a residential improvement, if the occupant participates in the agricultural operation or is a statutorily specified relative of a participant in the agricultural operation. It also includes land under other improvements if such improvements are an integral part of the farm or ranch and are typically used as an ancillary part of the operation.  A farm is defined as a parcel of land used to produce agricultural products that originate from the land’s productivity for the purpose of obtaining a monetary profit.  A ranch is defined as a parcel of land used for grazing livestock for the primary purpose of obtaining a monetary profit. The term “livestock” refers to domestic animals used for food for human or animal consumption, breeding, draft, or profit.  A parcel of land is considered to be in the process of being restored through conservation practices if the land has been placed in a conservation reserve program established by the Natural Resource Conservation Service pursuant to 7 U.S.C. secs. 1 to 5506, or a conservation plan approved by an appropriate conservation district implemented for the land for up to a period of 10 crop years.  Real property improvements, such as structures, buildings, fixtures, and fences, are valued separately from the land. 2. A parcel of land that has at least 40 acres of forestland and that is subject to a forest management plan. The land must produce tangible wood products that originate from the productivity of the land for the primary purpose of obtaining a monetary profit. Land underlying any residence or other improvements used as an ancillary part of the operation is classified as agricultural land. 3. A parcel of land that a) consists of at least 80 acres, or less than 80 acres if the parcel does not contain any residential improvements, b) is subject to a perpetual conservation easement, c) was classified as agricultural at the time the easement was granted, d) the easement was granted to a qualified organization, e) the easement is exclusively for conservation purposes, and f) all current and future uses of the land are described in the easement. This provision does not include any portion of land that is used for nonagricultural, commercial, or nonagricultural residential purposes.” 4. A parcel of land used as a farm or ranch if the owner has a decreed water right or a final permit to appropriated ground water for purposes other than residential use, and water appropriated under such right or permit is used for the production of agricultural or livestock products on the land. This provision does not include the two-year use requirement detailed in item 1. 5. A parcel of land that was reclassified from agricultural to another classification and met one of the foregoing requirements during the three years before the year of assessment. The land need not have been classified or eligible for classification as agricultural during the 10 years preceding the year of assessment. All other agricultural property that does not meet the foregoing requirements will be classified according to its actual use on January 1 and valued using appropriate consideration of the three approaches to value (cost, market, and income). VALUATION AND TAXATION Agricultural Land The actual value of agricultural land, exclusive of improvements, is based on the earning or productive capacity of the land, capitalized at the statutory rate of 13%. The landlord’s gross income is calculated by multiplying the 10-year average price of the commodity or grazing rental rate by the yield associated with the subject property’s soil classification, and then multiplying that figure by the typical landlord’s crop share. The 10-year average of typical landlord expenses are subtracted from the landlord’s gross income to arrive at the landlord’s net income. The net income is then capitalized by the statutory 13% rate to arrive at an indication of actual value. The assessed value of the land is calculated by multiplying the actual value of the land by the assessment rate (currently 26.4%). Agricultural Residential Improvements Residential property is valued using only the market approach to value. In this approach, the actual value of the subject residence is based on an analysis of comparable sales minus the value attributed to the land. “Residential land” also includes two acres or less of land on which a residential improvement is located and where the improvement is not integral to an agricultural operation conducted on the land. The assessed value of the residence and associated residential land is calculated by multiplying the actual value of the residence by the current residential assessment rate Agricultural Structures Agricultural structures used as an ancillary part of the operation are valued using appropriate consideration of the three approaches to value (cost, market, and income). While all three approaches to value must be considered, agricultural structures are typically valued using the cost approach. In the cost approach, the actual value of the building is based on the replacement cost new minus accrued depreciation. The actual value is multiplied by the statutory 26.4% assessment rate. Personal Property Agricultural equipment used on a farm or ranch for planting, growing and harvesting agricultural products or for raising or breeding livestock for the primary purpose of obtaining a monetary profit is exempt from property taxation. Other personal property such as livestock, livestock products, agricultural products, and supplies are also exempt from property taxation. COLLECTION OF INFORMATION To ensure that land is accurately classified and valued, the assessor may request an on-site inspection and/or additional information such as the IRS 1040-F form filed in the previous year, grazing lease(s), or an agricultural land classification questionnaire. Any documentation provided to the assessor by the property owner is subject to confidentiality requirements as provided by law. DocuSign Envelope ID: CD893182-ECC1-413D-B480-CEAB1223B4FC QUESTIONS For additional information regarding property taxation procedures in Colorado, contact the Colorado Division of Property Taxation at (303) 864-7777 or contact your county assessor. Prepared by: Colorado Division of Property Taxation Department of Local Affairs 15-DPT-AR PUB B5 (01/22) OFFICE OF THE COUNTY ASSESSOR Adams County ............................ (720) 523-6038 Alamosa County ......................... (719) 589-6365 Arapahoe County ........................ (303) 795-4600 Archuleta County ........................ (970) 264-8310 Baca County ............................... (719) 523-4332 Bent County ................................ (719) 456-2010 Boulder County ........................... (303) 441-3530 Broomfield County ...................... (303) 464-5819 Chaffee County ........................... (719) 539-4016 Cheyenne County ....................... (719) 767-5664 Clear Creek County .................... (303) 679-2322 Conejos County .......................... (719) 376-5585 Costilla County ............................ (719) 937-7670 Crowley County .......................... (719) 267-5229 Custer County ............................. (719) 783-2218 Delta County ............................... (970) 874-2120 Denver County ............................ (720) 913-4162 Dolores County ........................... (970) 677-2385 Douglas County .......................... (303) 660-7450 Eagle County .............................. (970) 328-8640 Elbert County .............................. (303) 621-3101 El Paso County ........................... (719) 520-6600 Fremont County .......................... (719) 276-7310 Garfield County ........................... (970) 945-9134 Gilpin County .............................. (303) 582-5451 Grand County ............................. (970) 725-3060 Gunnison County ........................ (970) 641-1085 Hinsdale County ......................... (970) 944-2225 Huerfano County ......................... (719) 738-3000 Jackson County .......................... (970) 723-4751 Jefferson County ......................... (303) 271-8600 Kiowa County .............................. (719) 438-5521 OFFICE OF THE COUNTY ASSESSOR Kit Carson County ...................... (719) 346-8946 Lake County ............................... (719) 486-4110 La Plata County .......................... (970) 382-6221 Larimer County ........................... (970) 498-7050 Las Animas County .................... (719) 846-2295 Lincoln County ........................... (719) 743-2358 Logan County ............................. (970) 522-2797 Mesa County .............................. (970) 244-1610 Mineral County ........................... (719) 658-2669 Moffat County ............................. (970) 824-9102 Montezuma County .................... (970) 565-3428 Montrose County ........................ (970) 249-3753 Morgan County ........................... (970) 542-3512 Otero County .............................. (719) 383-3010 Ouray County ............................. (970) 325-4371 Park County ............................... (719) 836-4331 Phillips County ........................... (970) 854-3151 Pitkin County .............................. (970) 920-5160 Prowers County .......................... (719) 336-8000 Pueblo County ............................ (719) 583-6597 Rio Blanco County ..................... (970) 878-9410 Rio Grande County .................... (719) 657-3326 Routt County .............................. (970) 870-5544 Saguache County ....................... (719) 655-2521 San Juan County ........................ (970) 387-5632 San Miguel County ..................... (970) 728-3174 Sedgwick County ....................... (970) 474-2531 Summit County ........................... (970) 453-3480 Teller County .............................. (719) 689-2941 Washington County .................... (970) 345-6662 Weld County ............................... (970) 400-3650 Yuma County ............................. (970) 332-5032 CLASSIFICATION AND VALUATION OF AGRICULTURAL PROPERTY IN COLORADO This brochure was created to provide general information on the classification and valuation of agricultural property in Colorado. For additional information regarding property taxation procedures in Colorado, please visit cdola.colorado.gov/property-taxation. DocuSign Envelope ID: CD893182-ECC1-413D-B480-CEAB1223B4FC