From public safety funding, to tax increases, to potential cannabis revenue, Loveland residents have questions about the city’s finances. On Thursday, they got some answers from city staff at a public meeting to discuss the ins and outs of Loveland’s general fund and how tax dollars are spent in the city.
“I thought it was very well done,” said Jeanne Berryman, who came to the event hoping to learn more about a potential sales tax increase on the November ballot. “I love the charts and the numbers and the percentages and I think it does help. And I thought the questions were very informed.”
Berryman was one of around 20 residents who attended the event in person at City Council chambers on Thursday. Another 40 or so logged into Zoom for the meeting, and it also streamed on YouTube and Facebook Live.
Loveland Chief Financial Officer Brian Waldes took attendees through a 30-minute crash course in city financing, starting with an explanation of the city’s “checkbook,” or the three main fund types that support city services — the general fund, enterprise funds and special revenue fund.
Enterprise and special revenue funds, Waldes explained, hold money dedicated to specific purposes, such as golf, broadband, water and power, and tourism. By contrast, the general fund is used for what are thought of core city services, including public safety (fire and police), streets, parks, cultural services and much, much more.
“The general fund also provides for a lot of the services that inform Loveland’s character,” he said. “In other words, the things that make Loveland, Loveland.”
Revenue for the general fund primarily comes from a 3% tax on retail sales in Loveland and 9.564 mill levy on property, rates that have remained static since 1984 and 1992 respectively. Those rates are also both among the lowest in the northern Front Range, and, now that the sales tax on food for home consumption has been eliminated, combine to give Loveland residents the lowest tax-burden compared to nine other municipalities, Waldes explained .
“Loveland comes out dead last, in terms of our revenue model,” he said.
And that revenue is expected to cover a wide range of services, Waldes continued. Of every tax dollar collected in Loveland, 39 cents goes toward public safety, 20 cents goes toward internal support operations, 16 cents to parks and cultural services, 15 cents to transportation and the remaining 10 cents goes to economic development, executive departments and community support.
Waldes also spoke to the gathering about the Taxpayer Bill of Rights (TABOR) amendment, which was passed by Colorado voters in 1992. In addition to requiring voter approval of any tax increases, it also requires local governments to refund any excess revenues it collects in any given year.
That last provision can be waived by the voters, allowing the city to keep its excess funds, either permanently or for a specified period of time. Loveland voters have approved four overrides since 1994, resulting in $51 million in additional revenue for the city, most of which was set aside for street maintenance.
The city’s latest override is due to expire at the end of the year, and there will likely be a ballot question asking for another one coming this November. If it is not approved, Loveland taxpayers will be due a $15.71 refund, but getting that into their hands could be a complicated process, Waldes explained.
“Tabor is infamously silent as to what is a refund and what is a taxpayer,” he said. “… Is it anybody who’s paid sales tax in our community? Is it just people who pay property tax? It’s not defined.”
Waldes wrapped up the presentation with an offer to take his show on the road to any community group that wants to know more about Loveland’s finances. He also urged the audience to visit the new and improved Loveland finance website and to tune in to future City Council deliberations on the budget and a possible tax increase ballot question.
The final 30 minutes of the meeting featured a question and answer session and attendees quickly lined up, hoping to learn more about the potential ballot question, how inflation has impacted revenue collections over the decades and how much marijuana revenue the city might collect if dispensaries are allowed.
Some attendees had more pointed questions for Waldes and his team, particularly about the city’s tax-sharing agreements with developers and how that was impacting the city budget. Waldes referred them to the Loveland Urban Renewal Authority fund 603 in the budget and explained that those funds aren’t “coming out” of the general fund.
“When those projects are conceived, the idea is to split the revenue from just that project, so not from other revenues in the general fund,” he said.
Waldes also faced questions over the methodology he used in calculating the estimated $10 million to $13 million revenue loss this year due to the food tax elimination.
For more answers to budget questions or to see a video of the presentation, visit letstalkloveland.org/budget. For more information about Loveland’s finances, visitor lovgov.org/services/finance.