Colorado Disabled Veteran Property Tax: A Colorado Editorial

VA "UNEMPLOYABILITY" - How did it disqualify vets from Colorado's Disabled Veteran Property Tax Exemption?
by Wes Carter, National Chairperson, The C-123 Veterans Association for the Fort Collins Coloradoan

In 2006 Colorado voters amended our constitution to provide totally disabled military veterans a small partial property tax exemption. This is now Article X Section 3.5 of the constitution and 39-3-202 of our statutes. The Legislative Council 2006 Blue Book explained to voters that federal VA disability ratings are the standard followed by Colorado to qualify veterans for their exemption.

VA has two ratings recognizing a veteran’s total and permanent disability. One rating is for injuries VA rules consider 100% disabling. The other rating is for severe military injuries even worse than the disability percentage VA rules allow for that particular injury or illness, and which make the veteran unable to work for the remainder of his/her lifetime...that rating is termed, "Total Disability Individual Unemployability" (TDIU.) Both of these VA ratings are for total and permanent disability based solely on military illnesses or injuries. 

Nothing in the law permits denying TDIU veterans the tax exemption, yet the state refuses to honor any applications without a basis for refusal. Looking back to the Blue Book’s Referendum E explanation, voters were told it is for veterans so disabled by military illness or injury that meaningful work is impossible for their remaining lifetime. Referendum E passed by a decisive four-to-one margin.

Because voters amended the constitution addressing veterans whose permanent and totally disabling illnesses and injuries caused unemployability for life, there is no justification for agencies to invent disqualifiers for TDIU.

But that’s what happened, and it’s wrong.

As per Colorado’s constitution, federal VA ratings must be respected. Veterans rated totally and permanently disabled, including TDIU, must be afforded their lawful property tax exemption.

Other Coloradans wouldn’t tolerate being unconstitutionally taxed. 

These veterans have been patient long enough.

Veterans need to very carefully read DMVA Property Tax Exemption & UNEMPLOYABILITY web page. Have fun figuring out what they mean!

Carefully read this DMVA web page on the property tax exemption and Individual UNEMPLOYABILITY.

"Unacceptability?"  Individual unACCEPTABILITY? Did DMVA perhaps have a little typo and actually mean unEMPLOYABILITY???

Has a solution arrived for Colorado's Disabled Veteran Property Exemption?

One of the staff at the Department of Military and Veterans Affairs described their view on disabled veterans rated totally and permanently disabled per unemployability...  TDIU:

"The Department goes above and beyond this language by reaching beyond the CFR 4.1 “rating” definition to include “permanent total disability veterans, even though their numerical rating may be lower than 100% as specifically called out in the Colorado Constitution and the original referendum."

WAIT A SECOND:  That's exactly what a totally and permanently disabled for unemployability (TDIU) VA disability rating can be described as. Yet, 100% of such claims are disqualified by DMVA.

Let's look at a federal VA award letter for TDIU to see if all elements required by DMVA are there:

"UNEMPLOYABILITY" - How did it pop up as a disqualification for Colorado's Disabled Property Tax Exemption?

Back in 2006 Colorado voters amended our constitution to provide a partial property tax exemption (a small one, about $480 on average) for totally disabled military veterans. This is now Article X Section 3.5 of the constitution and §39-3-202(2) C.R.S of our statutes. The 2006 Blue Book explained that federal VA ratings would be the standard followed for veterans to qualify. 

The VA has only two such ratings. 

One is for injuries that are so severe the veteran is made 100% disabled. The other is for injuries that are severe but even worse than the percentage of disability VA rules allow for that particular injury or illness, and which by themselves (only military issues) make the veteran unable to work for the remainder of his/her lifetime...that rating is termed IN THE LAW as, "Total Disability Individual Unemployability" (TDIU.) BOTH of these VA ratings are for ONE HUNDRED PERCENT PERMANENT AND TOTAL DISABILITY. 

Colorado has a problem in that for some reason outside the law, the state opted to refuse the exemption to veterans having the VA TDIU rating.  Although state agencies refuse to accept TDIU or unemployability, that refusal isn't in the constitution, the legislation or the 2006 Referendum E, for which the Blue Book specifically referenced totally disabled veterans unable to work for their remaining lifetime.

It seems the only mention of unemployability is in the instructions and web pages saying it is unacceptable...only in the forms for the final implementation of the referendum, the constitutional amendment, and the legislation does unemployability get mentioned as a disqualifier. Unemployability, one of the two VA ratings for total and permanent military service disability is simply (and wrongly) excluded.

That's wrong. It needs correction, and we call on DMVA and DOLA to make implementation of this constitutional benefit properly reflect the constitution. VA's rating of veterans should be respected as detailed in the law. ALL veterans rated totally and permanently disabled, including via the TDIU rating, should be afforded this modest property tax exemption.

Here's what the law says are our totally disabled veterans entitled to the partial tax exemption:

Colorado 39-3-202 C.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.”

COLORADO DEPARTMENT OF MILITARY & VETERAN AFFAIRS

Property Tax: Disabled Veteran Property Tax Exemption

This program is for Disabled Veterans who:

• Are RATED by the U.S. Department of Veterans Affairs at 100%, Permanently and Totally Disabled by the U.S. Department of Veterans Affairs (Individual Unacceptability(?*) does not qualify) AND

• You must have owned and occupied the property since January 1st of the year in which the Veteran is applying. (*unacceptability is DMVA's typo, not mine!)

COLORADO DEPARTMENT OF THE TREASURY

“Requirements for Eligibility, Veterans

• Applicant must be a disabled veteran who has been rated by the U.S. Department of Veterans Affairs as permanently disabled. (VA unemployability awards do not meet the requirement for determining an applicant's eligibility.)”

COLORADO DEPARTMENT OF LOCAL AFFAIRS

ELIGIBILITY REQUIREMENTS, Qualifying Disabled Veteran:

To qualify, a disabled veteran must meet each of the following requirements: 

• Served active duty in U.S. armed forces.

•  Was honorably discharged.

• Sustained a service-connected disability rated by the U.S. Department of Veterans Affairs as 100% permanent and total.  Disabilities rated less than 100% and VA employability awards do not meet the eligibility requirements.

BUT WAIT: THERE'S MORE!
There's another problem with the way Colorado implements this constitutional benefit and its enabling legislation. They simply haven't gotten around to it.

The constitution also recognized servicemembers that the military retires as totally and permanently disabled. Through an oversight, these disabled veterans were simply not mentioned in the statutes and were therefore refused the exemption even though it was a constitutional right, spelled out crystal clear, word for word:

"...through disability retirement benefits pursuant to a law or regulation administered by the department, the United States departments of homeland security, or the departments of Army, Navy, or Air Force.”

In May 2015 the governor signed an act unanimously approved by both houses of the legislature in May 2016 to correct the problem by placing those last fifteen words in the constitution also in the law. For some reason the correction hasn't been implemented by the responsible state agencies...it has simply been ignored. Totally disabled military retirees continue to be taxed and the constitution abused. 

When I've tried to discuss this disconnect with officials there's been no disagreement about the issue, but it doesn't seem a big deal to anyone.

This is a big deal! The people of the state are the supreme power, and the constitution reflects the will of the people, with state officials from the governor on down sworn to protect and defend it. A right specifically guaranteed by our state constitution cannot simply be ignored by agencies that didn't get around to honoring it. You may recall that in 1776 unfair taxation led to some disagreement between England and her American colonies. 

Thankfully, officials have indicated that things will be set right by January 2018, ending eleven years of unconstitutional taxation of this group of totally disabled military retirees. By January, these veterans will have been unconstitutionally overtaxed about $4,800 each.

DAV URGES OUR SUPPORT FOR WIDOW/ER'S SURVIVOR BENEFITS

Great News: Colorado Dept of Military & Veterans Affairs says they do address permanent TDIU claims!

A statement received today gives great hope. CDMVA will double-check but this seems to be what we've been hoping for all along!

Their statement:

The Department goes above and beyond this language by reaching beyond the CFR 4.1 “rating” definition to include “permanent total disability” veterans, even though their numerical rating may be lower than 100% as specifically called out in the Colorado Constitution and the original referendum.

COLORADO DISABLED VETERAN PROPERTY TAX DENIED TO ALL VA TDIU* VETS - background & source documents

 * Total Disability Individual Unemployability=100% disabled vets denied Colorado's property tax exemption for 100% disabled vets

November 27, 2017

To: All Colorado officials and citizens respecting our state’s constitution

Problem: Most veterans rated 100% permanently and totally disabled by the federal Department of Veterans Affairs are refused Colorado’s disabled veteran partial property tax exemption provided for in the state constitution, Article X Section 3.5. Voters acted to provide them the exemption in 2006 but state officials refuse.

Discussion: THE EXPRESSED WILL OF THE PEOPLE OF COLORADO IN THEIR APPROVAL IN 2006 OF REFERENDUM E AS EXPLAINED BY THE LEGISLATIVE COUNSEL FOR ARTICLE X SECTION 3.5 OF THE STATE CONSTITUTION HAS BEEN ABUSED. The state constitution provides that the will of the people is paramount. That will was expressed in 2006 when the voters of Colorado approved by a margin of four-to-one amending the constitution in 2006 with Referendum E.

The Legislative Council submitted the ballet explanation to the voters as part of its constitutional duty to inform the electorate as per the constitution: “A fair and impartial analysis of each measure, which shall include a summary and the major arguments both for and against the measure, and which may include any other information that would assist understanding the purpose and effect of the measure.”

What voters were informed about by Legislative Council, and approved, and what the Colorado Department of Military and Veterans Affairs (CMDVM) have proven to be two greatly different things with CDMVN prohibiting veterans rated by the federal Department of Veterans Affairs as 100% permanently and totally disabled via TDIU (total disability individual unemployability.)

Affected are over 6,000 veterans totally disabled solely due to military service.

The “Colorado Property Tax Reduction for Disabled Veterans Referendum,” also known as Referendum E, was on the November 7, 2006 ballot in Colorado as a legislatively referred constitutional amendment, where it was approved with a margin of four-to-one. The measure extended a property tax exemption for qualified senior citizens to all U.S. military veterans living in Colorado who are 100% disabled due to a service-related disability.

There are therefore two fundamental qualifications for veterans rated 100% permanently and totally disabled (TDIU):
      a: Legislative Counsel specifically described a veteran disabled and unable to work for the rest of his/her life in the language voters approved in Referendum E.
      b: TDIU veterans also qualify on the clear language in Article X Section 3.5 describing veterans rated by the federal Department of Veterans Affairs as 100% permanently and totally disabled, especially when referring to 38 CFR 4.16 - "Total disability ratings for compensation based on unemployability of the individual."

Here is the exact information provided by Legislative Counsel on Referendum E, upon which it was approved by the people:

COLORADO PROPERTY TAX REDUCTION FOR DISABLED VETERANS, REFERENDUM E (2006) THE LANGUAGE SHALL APPEAR ON THE BALLOT AS:

“ AN AMENDMENT TO SECTION 3.5 OF ARTICLE X OF THE CONSTITUTION OF THE STATE OF COLORADO, CONCERNING THE EXTENSION OF THE EXISTING PROPERTY TAX EXEMPTION FOR QUALIFYING SENIORS TO ANY UNITED STATES MILITARY VETERAN WHO IS ONE HUNDRED PERCENT PERMANENTLY DISABLED DUE TO A SERVICE-CONNECTED DISABILITY.

How does the program work? Homeowners pay property taxes based on the value of their home and the tax rate set by the local governments where they live. Referendum E reduces the taxable value of a qualified veteran's home by one-half of the first $200,000 of the home's value, thereby lowering property taxes owed on the home. The state legislature can adjust the $200,000 amount to either increase or decrease the benefit from Referendum E in future years. Currently, the state offers the same property tax reduction to homeowners age 65 and over who have lived in their homes for at least ten years. A qualifying veteran who is also eligible for a reduction in property taxes as a senior cannot claim both reductions. The dollar amount of the tax reduction will vary among homeowners depending upon the local property tax rate, the home's value, and the amount of the exemption. Table 1 provides examples of how Referendum E reduces property taxes based on the average statewide property tax rate and the current exemption level.

Who qualifies for the tax reduction? Homeowners who have served on active duty in the U.S. Armed Forces and are rated 100-percent permanently disabled by the federal government due to a service-connected disability qualify for the tax reduction in Referendum E. Colorado National Guard members injured while serving in the U.S. Armed Forces also qualify. Veterans are rated 100-percent permanently disabled when a mental or physical injury makes it impossible for the average person to hold a job and the disability is lifelong. Nationally, less than one percent of veterans have a 100-percent permanent disability rating. About 2,200 veterans are expected to qualify.

Please note the highlighted sections of the Colorado state constitution below and the supreme authority of the people, and of a referendum amending the constitution.

Solution: Colorado Department of Military and Veterans Affairs, and Colorado Department of Local Affairs must extend the exemption to veterans rated TDIU.

Conclusion: Colorado voters approved specific language recognizing as a totally disabled veteran a veteran rated by the federal Department of Veterans Affairs as 100% permanently and totally and disabled, noting the wording provided by Legislative

Counsel of such a veteran being unable to work for the remainder of his/her lifetime. It is of note that all veterans rated by VA as TDIU (total disability for individual unemployability) are to work and forfeit their disability if they elect to do so regardless of their injuries.

The federal law governing TDIU and upon which our constitution states CMDVM is bound, states, “It is the established policy of the Department of Veterans Affairs that all veterans who are unable to secure and follow a substantially gainful occupation by reason of service-connected disabilities shall be rated totally disabled.”

Colorado’s taxing agencies disregard what the people voted for and unlawfully limit the property tax exemption by refusing TDIU veterans.

The people voted to modify the constitution and extend the disabled property tax exemption to veterans rated permanently TDIU. That vote must be honored by the legislature and our state agencies.

Respectfully,

Wesley Carter

www.codisabledvet.blogspot.com
Attached:
1. Portions Colorado Constitution
2. Source documents

Colorado's Legislative Counsel Needs to Explain Referendum E and the People's Wishes to State VA Officials

Dear Legislative Counsel,

We ask your assistance in a constitutional issue rooted in language submitted to voters by the Legislative Counsel.

In 2006 your department provided detailed wording for Referendum E for voter approval, explaining aspects of disabled veterans and the proposed partial property tax exemption.

Voters were told by LC, in your words, "Veterans are rated 100-percent permanently disabled when a mental or physical injury makes it impossible for the average person to hold a job and the disability is lifelong" and on that basis the people approved amending the Colorado constitution Article X Section 3.5.

Subsequently state agencies acted wrongly to deny veterans unable to work for the rest of their lives due to service-connected issues and rated as such by the federal Department of Veterans Affairs. This is even though it was the clear wish of the people, using the referendum's explanation, that category of veterans was to receive the exemption as described by the Legislative Counsel.​​

​There need be no changes in legislation, but only clarification by LC that it is contrary to the constitution and the people's wishes, and your own wording in the guidance given voters, that veterans rated TDIU (total disability for individual unemployability) be denied their constitutional protections.

Colorado anchors this exemption on the federal VA ratings for disability. Please consider the text, and the very title of the law: 38 CFR 4.16 - "Total disability ratings for compensation based on unemployability of the individual."

To describe Referendum E, you told the voters:

How does the program work? Homeowners pay property taxes based on the value of their home and the tax rate set by the local governments where they live. Referendum E reduces the taxable value of a qualified veteran's home by one-half of the first $200,000 of the home's value, thereby lowering property taxes owed on the home. The state legislature can adjust the $200,000 amount to either increase or decrease the benefit from Referendum E in future years. Currently, the state offers the same property tax reduction to homeowners age 65 and over who have lived in their homes for at least ten years. A qualifying veteran who is also eligible for a reduction in property taxes as a senior cannot claim both reductions.

The dollar amount of the tax reduction will vary among homeowners depending upon the local property tax rate, the home's value, and the amount of the exemption. Table 1 provides examples of how Referendum E reduces property taxes based on the average statewide property tax rate and the current exemption level. 

Who qualifies for the tax reduction? Homeowners who have served on active duty in the U.S. Armed Forces and are rated 100-percent permanently disabled by the federal government due to a service-connected disability qualify for the tax reduction in Referendum E. Colorado National Guard members injured while serving in the U.S. Armed Forces also qualify. Veterans are rated 100-percent permanently disabled when a mental or physical injury makes it impossible for the average person to hold a job and the disability is lifelong. Nationally, less than one percent of veterans have a 100-percent permanent disability rating. About 2,200 veterans are expected to qualify for the property tax reduction in Colorado.

​Please help provide these constitutional protections due Colorado's disabled veterans thru the referendum approved by the people of this state. Exclusion of this group of veterans, termed by the VA as "total disability for individual unemployability"is  clearly contrary to the people's wishes as proposed by the Legislative Counsel.

attached: legislative history