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Colorado’s Disabled Veterans’ Property Tax Exemption – The “Missing in Action” Law

by Wes Carter, National Chairperson, The C-123 Veterans Association

It’s hard to believe. Over this last decade state officials simply ignored property tax provisions spelled out in Colorado’s constitution to provide a small exemption to totally disabled troops retired by the military for line-of-duty injuries. It’s like the law simply went missing in action.

Back in 2006 voters amended our constitution, approving by a four-to-one margin to provide a small, partial property tax exemption. Only about $480 on average, the exemption is for two categories of injured servicemembers: Troops retired by the military as totally and permanently, and second, veterans rated 100% totally and permanently disabled by the Department of Veterans Affairs. 

Referendum E carefully addressed both of the above categories because there are three differences between them:
1. Not all disabled military retirees also seek a VA disability rating – ratings must be applied for
2. Although based on similar laws, often military retirees face years of delays with claims and appeals to receive VA ratings, but military disability retirements are effective immediately upon leaving active duty
3. The military views a disability as medically unable, through line-of-duty illness or injury, to perform one's military specialty or be retrained in another; VA views disability as the percentage of loss of capacity to work in meaningful employment, somewhat similar to Social Security disability rules

(real example: Northern Colorado resident Vietnam-era veteran medically retired as 100% by the military in 1991 because of Gulf War injuries. Filed VA claims for numerous 100% disabling injuries and Agent Orange illnesses in 1992-1994 but not finally approved for 100% VA disability rating until 2015. Per our constitution's Article X Section 3.5, this veteran was eligible for Colorado's disabled veteran tax exemption in 2007. As of December 2017, still no state web site instructions or forms permit his application because only federal VA 100% disability ratings are mentioned, not his 100% military medical retirement.)

Problem: Through an oversight when the 2007 statute was drafted, the category of totally disabled military retirees was simply not mentioned…language about them is in the constitution, but was absent from the text of the law.

In 2015 concerned citizens discovered this missing language issue and asked the legislature to align the constitution with the statute. Both houses approved HB-1444 unanimously and it was signed into law in May 2016.

And it has been simply ignored since then.

Here's the law describing the partial tax exemption. The bold type was left out of the enabling statute:

Colorado 39-3-202C.R.S.

 “(3.5) ‘Qualifying disabled veteran’ means an individual who has served on active duty in the United States armed forces, including a member of the Colorado National Guard who has been ordered into the active military service of the United States, has been separated therefrom under honorable conditions, and has established a service-connected disability that has been rated by the federal department of veterans affairs as one hundred percent permanent disability through disability retirement benefits pursuant to a law or regulation administered by the department, the United States departments of homeland security, Army, Navy, or Air Force.”

May 2016. Governor signs HB16-1444. I'm on right.

Now the statute has been repaired, the missing words added to comply with the constitution. However, there's a problem with the way the law finally gets administered: Colorado officials simply haven't gotten around to its section addressing totally and permanently disabled military retirees so they’re still denied their property tax exemption. Officials never changed the application forms, the rules or the instructions.

The governor signed HB16-1444, an act unanimously approved by both houses of the legislature in May 2016 and placed those missing words from the constitution into the law, effective June 2016. His signature has been ignored, and without any constitutional or legal authority at all, totally disabled military retirees continue to be taxed and their rights abused.

When I've discussed this taxation disconnect with officials there's no disagreement about the problem. They just don’t see ignoring it as a big deal.

This is a big deal! The constitution expresses people’s will. Officials from the governor on down have sworn to protect and defend it. A constitutional provision like this can’t simply be ignored. You may recall that in 1776 unfair taxation led to some disagreement between England and her American colonies. 

Now that this problem has been pointed out to state officials, they’ve indicated rules and application forms might be set right by January 2018. But that’s so very late, especially considering the constitution provided their exemption effective ten years ago.

Few Coloradoans tolerate being wrongfully taxed. We owe these veterans so much more than this small tax exemption they’ve earned through disabling line-of-duty injuries. Colorado has no excuse for failing to provide it.

These veterans have been patient long enough. The constitution has been ignored long enough.

House Bill 16-1444 Passes Colorado Legislature Unanimously - Governor signs May 27

Thanks to the efforts of state Senator Keffalas and his colleagues, the conflict between Article X Section 3.5 of the Colorado constitution and its enabling legislation will be resolved tomorrow when the Governor signs House Bill 16-1444.

The constitution provided a modest property tax exemption to both VA 100% disabled veterans and military retired 100% disabled servicemembers. BUT...someone writing the subsequent legislation forgot the military and only specified VA, denying hundreds of retired totally disabled servicemembers the exemption guaranteed by the constitution.

WOW...it only took three months from mentioning the problem to Senator Keffalas, getting the support of the United Veterans Committee, and even the state Division of Military and Veterans Affairs, and the correction simply sailed through both houses without a dissenting vote.

So...one problem solved, and next we move on to the shameful discrimination suffered by Colorado's war widows and widowers, who are denied the property tax exemption afforded disabled veterans' survivors.

Why the exclusion of war widows and widowers? Because the constitution only provides the property tax exemption to those whose veteran husband/wife was in receipt of the exemption before the veteran's death. Logically, a soldier who dies in a roadside bomb or hostile artillery fire doesn't make it home to complete Colorado's application, but illogically, his/her survivor is denied the property tax exemption.