Colorado HB 1119 Split-Rate Property Tax: What Every Homeowner Needs to Know

By Prerna Kapoor, CLHMS | REAL Brokerage | April 22, 2026

If you own property in Colorado, there’s a bill working its way through the legislature right now that could change how your property taxes are calculated. It’s called HB 26-1119, and it introduces something called a “split-rate” property tax. I want to break down what this actually means for you, because the headlines aren’t telling the full story.

What HB 1119 Would Actually Do

Right now, Colorado taxes your land and the buildings on it at the same mill levy rate. Your total property tax bill is based on one combined assessed value. HB 1119 would give local taxing entities (cities, counties, certain special districts) the authority to apply different mill levy rates to the land portion and the improvement (building) portion of your property value.

Here’s the catch that matters: the bill says the mill levy rate on improvements must be equal to or less than the rate on land. In other words, local governments could tax your land at a higher rate than your house. They can’t do it the other way around.

This approach is sometimes called a “land value tax” or “split-rate tax,” and it’s been used in cities like Pittsburgh and some places in Australia. The idea behind it is to encourage development and discourage sitting on empty land.

Who’s Exempt and Who’s Not

Not every property owner would be affected equally. The bill specifically exempts several categories from split-rate taxation:

Agricultural land is off the table. So is land used for renewable energy production, land under perpetual conservation easements, oil and gas leaseholds, producing mines, nonproducing mining claims, and state-assessed land. If your property falls into any of these categories, this bill wouldn’t change anything for you.

For everyone else, especially residential homeowners, it would depend entirely on what your local government decides to do. The bill doesn’t mandate split-rate taxation. It just gives local entities the option.

What This Could Mean for Your Property Tax Bill

Let me walk through a simplified example. Say your property is assessed at $500,000 total: $200,000 for the land and $300,000 for the improvements. Right now, if your mill levy is 80 mills, you pay taxes on the combined value. Under a split-rate system, your local government might set the land rate at 90 mills and the improvement rate at 70 mills.

Whether your bill goes up or down depends on the ratio of land value to improvement value in your specific property. Homes on large lots with relatively modest buildings would likely pay more. Homes with significant improvements on smaller lots might actually see a decrease.

In the south Denver suburbs where I work most, lot sizes tend to be moderate and homes are well-built. For many homeowners in Parker, Aurora, Castle Pines, and Lone Tree, the impact would likely be modest. But if you own a large undeveloped lot or land-heavy property, you’d want to pay close attention.

The TABOR Question

Colorado’s Taxpayer Bill of Rights (TABOR) limits how much revenue local governments can collect. The bill is clear that nothing in HB 1119 overrides TABOR or any existing mill levy caps. So even if your local government adopts split-rate taxation, they can’t use it as a way to increase total revenue beyond what TABOR allows.

That’s an important safeguard. It means this is more about how the tax burden is distributed, not about raising the total amount collected.

When Would This Take Effect?

If HB 1119 passes as written, the effective date would be August 12, 2026, assuming the General Assembly adjourns on schedule in May. But even then, it wouldn’t automatically change your taxes. Your local government would still need to vote to adopt split-rate taxation for your area.

The Colorado Association of REALTORS is actively tracking this legislation, and many local real estate professionals are watching it closely. Whether you support or oppose the concept, it’s worth understanding what it could mean for your specific situation.

What You Should Do Right Now

There’s no need to panic. This is still a bill, not a law. But here’s what I’d suggest:

First, look at your most recent property assessment. Find out how much of your assessed value is land versus improvements. This is available through your county assessor’s website. In Douglas County, you can look this up at douglas.co.us/assessor. Arapahoe County has similar tools at arapahoegov.com.

Second, pay attention to your local government’s stance on this. If your city council or county commissioners express interest in split-rate taxation, that’s when the conversation gets real for your specific tax bill.

And if you want to share your opinion, the Colorado Real Estate Commission held a stakeholder meeting on April 3, 2026 to discuss this and related topics. These meetings are public, and your voice matters.

If you have questions about how this might affect your home’s value or your buying and selling plans, I’m always happy to talk it through. Property taxes are one of those things that affect every homeowner, and staying informed is the best thing you can do.

Prerna Kapoor | REALTOR® | Luxury Home Specialist
REAL Brokerage | 720-949-5450 | info@prernakapoor.com
CLHMS • RENE • PSA • ABR | International Sterling Society Award Winner

Prerna specializes in residential real estate across Parker, Aurora, Lone Tree, Castle Pines, Highlands Ranch, Cherry Creek, Greenwood Village, and Centennial. She speaks English, Japanese, and Hindi.