About 1 dozen builders are holding out on Loveland and not coming to agreement with the city regarding the Use Tax the city says they owe from recent audits. The Use Tax is the 3% builders pay (instead of sales tax) on all materials used in constructing new homes and commercial buildings in Loveland. When the building permit is issued the builder pays a deposit based upon an estimate of the cost of the project. The truth is some builders (for reasons not entirely clear) paid an amount that was far below the actual tax they owed at the end of the project but were never questioned. Years later, the City of Loveland is now trying to correct the errors which were made worse by some faulty data used to assist in the estimates.
This is a complicated issue and we encourage everyone to please read the background data provided at LovelandPolitics main page on Use Tax
What should the city do? 1. Collect the tax as the law requires and not make any after the fact exceptions. 2. Forgive the minor amount of difference between the city estimates and the builder's. 3. Forgive all the hold-outs who may have intentionally underestimated their project cost in order to avoid having to pay the actual tax owed.