Those neighbouring counties don't raise as much property taxes because there's nothing on the land.

You could argue that the land doesn't cost those neighbouring counties anything, so it's a wash.

It's sort of backwards when you're talking about municipalities competing for property tax revenue. Boulder city wants property tax revenue, so they allow development in specific places where they reap that. Therefore the city owns land that isn't land within the city so they can maximize property tax revenue, but still have a undeveloped belt. The surrounding counties aren't a big fan of this relationship, but can't do much about it.

Yes they can: tax land, not property.

They've got their own reasons for not going all georgist on it, as much as I'd personally love to see it happen.

The city of Boulder needs to pay property taxes on that land to the other counties, and that money comes from the local taxes that Boulder residents have to pay.