Actual Value and the Assessment Rate

In most states, the number the tax is computed on is a fraction of market value fixed by constitution or statute, and the interesting arguments are about the value. Colorado adds a second moving part: the assessment rate that turns actual value into assessed value is set by the legislature, and it has moved in each of the last several sessions. Two identical houses in two different years can carry different assessed values with neither the market nor the assessor changing.

The chain: actual value × rate × mill levy

1. Actual value — the assessor’s determination of what the property is worth, as of the January 1 assessment date, classified by its actual use on that date.
2. Assessed value — actual value × the assessment rate for the property’s class. Residential property is assessed at a fraction of its actual value; most other classes (commercial, industrial, vacant land) are assessed at a higher share.
3. The tax — assessed value × the mill levy of each taxing district. One mill is $1 per $1,000 of assessed value, and your total levy is the sum of every district that overlaps your parcel.

Residential is valued by sales alone

Colorado’s constitution directs that residential property be valued using the market approach only — comparable sales. Commercial, industrial and vacant land may be valued by any of the three approaches (market, cost, income). This makes the residential comparable-sales window — the period from which sales are drawn — the central fact of a Colorado residential appeal: evidence has to speak to that window, not to the market today.

The rate is legislative — and volatile

The assessment rates change because the legislature recalibrates them — partly in response to market swings (a hot market raises actual values, and rate cuts are the counterweight), and partly through outright policy changes. Since 2025, residential property even carries two different rates: one applied for local-government assessed value and another for school-district assessed value — a single property with two assessed values on the same bill.

What this tells you: a year-over-year change in your assessed value has two possible causes — your actual value moved, or the rate did. Only the first is arguable in a protest; the rate is the same for everyone in your class statewide. Before comparing years, separate the two effects.

What it does not tell you: the current-year rates. This page deliberately does not restate them as permanent rules; the Division’s own table (linked from the hub) and your notice are the authorities.

Worked example (illustrative)

Illustrative arithmetic with made-up round numbers — not current statutory rates.

1. Inputs: actual value $500,000; an illustrative residential rate of 6.7% for local-government purposes and 6.95% for school purposes; a combined mill levy of 80 mills.
2. Step — assessed value: 6.7% of $500,000 is $33,500 (local); 6.95% is $34,750 (school) — two bases from one property.
3. Step — the tax: each base is multiplied by the levies of its respective units, then summed. A 10% cut in the rate would drop the assessed value by 10% with the actual value untouched.

What this tells you: the protest targets actual value — the only number the assessor controls — and a successful protest of, say, $40,000 of actual value lowers each assessed base proportionally.

What this page does not cover

The Gallagher-era history and the constitutional amendments behind the current rates, and the personal-property valuation rules, are outside this page. The Division’s pages cited below are the authorities for the classification and rate mechanics.