Library case goes back to court

August 19, 2009

By JoAn Bjarko

The Wellington

District Court Judge Stephen Schapanski will once again weigh in on how Wellington and the Poudre River Public Library District should handle taxes on future annexations to the town.

The library district wants to continue taxing the annexed properties, but Wellington contends it would be a burden on the property owners to have to support two library systems. Wellington has its own library which is supported by the town’s general fund.

Last October, Schapanski ruled in Wellington’s favor, but the Poudre River Public Library District (then called the Fort Collins Regional Library District) appealed the district court decision.

On July 9, the appeals court reversed the district court, saying the judge failed to consider a relevant section of library law. Wellington asked the appellate court to reconsider, contending the law it cited does not fit the circumstances that the town and the library district are facing. The Court of Appeals recently denied the town’s request.

Wellington’s town attorney, Brad March, advised town board members on Aug. 11 that they could ask the Colorado Supreme Court to overrule the Court of Appeals or they could take no action, which would send the case back to district court in Fort Collins.

Town board members decided against spending money to attempt to plead their case with the state’s highest court. The issue has no bearing on Wellington’s tax collections, they reasoned, but it could especially discourage commercial development in future annexations. The library district collects 3 mills of property tax, and Wellington collects just over 14 mills of overall property tax. Pending a ruling from the judge, new annexations could pay as much as 21.4 percent more in property taxes than their counterparts within the current town boundaries.

March explained that the district court will have to determine how properties will be taxed after they become part of the town, namely whether the tax paid to the library district will be based on the land’s current agricultural value or on its value after development. The difference could be many thousands of dollars.

“Agricultural tax receipts for a property are nominal and the cost to replace the revenue — as apparently contemplated by the court of appeals ruling — is minimal,” March told the board.

No property owners have completed their annexations since the library district formed in 2006.