Routt County rejects Storm Mountain Ranch tax appeal
July 30, 2012
Oct. 28, 2011: New agricultural tax law changes Routt County landscape
Steamboat Springs — The Routt County Board of Commissioners, acting as the Board of Equalization, voted unanimously but not without reservations Monday to reject an appeal from a dozen homeowners in Storm Mountain Ranch who want a favorable agricultural tax status restored to their building lots.
The commissioners upheld Assessor Gary Peterson's ruling under a new state law that found the Storm Mountain Ranch residents themselves were not "integral" to the ongoing agricultural operations at the 1,080-acre luxury development, and thus, the land under their estate homes no longer would be valued for tax purposes at low ag rates.
A one-acre building envelope there now is valued at $1.43 million for tax purposes instead of several thousands of dollars. Original purchase prices for 35-acre lots in 2005 were in the range of $2 million.
While supporting the intent of the new state law, the commissioners also expressed frustration with vague language they said places a difficult burden on local governments struggling to properly apply the law's provisions.
"The bill makes the same assumption that so much legislation makes," Commissioner Diane Mitsch Bush said, "that one size fits all."
Mitsch Bush was referring to 2011's House Bill 11-1114, which was sponsored by 27 state legislators in an effort to redistribute the overall tax burden more equitably by removing ag tax subsidies from residential home sites in larger neighborhoods where, in some cases, grazing leases are a means to avoid taxes. The ag status remains on home lots whose occupants actively are engaged in agriculture.
Mitsch Bush said the ongoing hay production and grazing operations at Storm Mountain Ranch, where a full-time ranch manager and several other employees are employed in ag in the midst of a luxury subdivision, make it a hybrid that wasn't considered when the new law was passed.
Monger encouraged Storm Mountain HOA President Rich Srednecki and his advisers to consider appealing the matter to the state Board of Assessment Appeals to get a clear interpretation of the law.
"I don't think we're at the pay level to make this determination," Commissioner Doug Monger said. "As much as you guys do a good job out there with agriculture and making sure the place looks good, I would say your property and similar property in other counties are part of why this bill came about."
Neither the county assessor nor the commissioners dispute that Storm Mountain Ranch homeowners are going to considerable lengths and expense to carry on a conscientious agricultural operation on the ranch two miles south of Steamboat Springs where Walton Creek pours out of a steep canyon. Instead, county government is having a difficult time finding that the homeowners fit into the language of the new law, which calls for them to be integral to the farming and ranching that takes place there by "regularly conducting, managing or supervising material aspects of ag operations."
The question, all agreed, is, What are the definitions of the terms “integral” and “regularly”?
Storm Mountain Ranch Manager Dan Bell said his homeowners meet six times each year and are involved in frequent phone calls having to do with the maintenance of irrigation ditches, fixing of fences and spraying to control weeds on the land. He said the ag portion of the HOA's annual budget easily could amount to $180,000 per year.
"Operations like (Storm Mountain Ranch) need to be brought into the spotlight," Mitsch Bush said. "There's nothing quite like this. This is different from a guy writing a check for a few cows grazing in August."
To reach Tom Ross, call 970-871-4205 or email tross@SteamboatToday.com