Phil Castle, The Business Times
The checks will soon be in the mail.
But if property owners want to send those checks back, the Grand Valley Drainage District ultimately will use the money to improve stormwater and irrigation drainage and in turn reduce the risk of flooding.
District Manager Tim Ryan said checks will start going out April 22, refunds to property owners for fees subsequently deemed a tax assessed in violation of state constitutional limits.
The district expects to pay back about 68 percent of what’s owed to property owners this year, with the remainder paid over the next four or five years, Ryan said.
Along with the checks, property owners will receive a letter and self-addressed stamped envelope if they choose to mail back the checks and donate the money to the district, he said.
The district will use donations to pay back the refunds more quickly. The faster the district can refund the full amount plus interest, the faster it can address what is by one estimate $100 million worth of needed work, Ryan said.
The district was established a century ago, initially to improve irrigation drainage and reduce flooding in a swath of the Grand Valley north of the Colorado River extending from Palisade to Loma. The role of the district evolved as the Grand Valley became more urbanized and roofs, streets and parking lots created more surfaces upon which stormwater runs off. The district now maintains a total of about 260 miles of open drains and piped facilities.
The district board of directors imposed a fee on the 38,000 property owners in the district starting in 2016 to fund projects to control stormwater runoff. Residential property owners paid on average $36 a year, but commercial owners paid more depending on the size of their properties.
The district collected the fee for three years, until a district court judge ruled the fee was actually a tax that exceeded limits imposed under the so-called Taxpayers Bill of Rights. The Grand Junction Area Chamber of Commerce and Mesa County challenged the fee in a lawsuit.
Ryan said the district board considered a number of options, but decided to directly refund the fees along with a 10 percent interest penalty that brings the total to about $9 million.
The district hired Dalby, Wendland & Co., a Grand Junction-based accounting firm, to handle the process.
Property owners will receive an initial refund of about 68 percent of the total fees they paid over the three years, Ryan said. Since refunds are linked to specific properties, they go to the current owners of those properties even if previous owners paid the fees.
Ryan said the district can’t refund the full amount in one year because of the interest penalty as well as the fact the district spent some of the money for projects, studies and other expenses.
The district will refund the remainder of the fees and interest over the next four to five years, he said.
The district will pay back the fees more quickly if property owners donate their refunds back to the district, Ryan said. They can do so by signing their checks and a letter and mailing them back in a self-addressed stamped envelope.
For those who want to make donations, it’s important they mail the checks and letters back rather then destroy or throw away the checks, he said. Under state law, that money would become unclaimed property administered by the Colorado Secretary of State’s Office.
Once the fees and interest are refunded, the district can allocate more of its revenue from property taxes to meeting its statutory duties to safely return stormwater and irrigation water to the Colorado River while taking on new projects, Ryan said. By one estimate, $100 million in capital projects are needed.