Visiting with the Colorado National Guard Conference

Great opportunity to discuss efforts to get property tax exemptions for Gold Star Spouses, not this year but working toward 2022 or 2023 at the latest.

Great opportunity to discuss efforts to get property tax exemptions for Gold Star Spouses, working toward 2022 or 2023 at the latest.

 

Equal Treatment for Colorado Gold Star Wives!

 

Update on Timing, United Veterans Coalition and More:

TIMING IS EVERYTHING

Today I've had some very welcome input from "those in the know" about a Gold Star Wives property tax
exemption efforts, and want to post it here.

First, neither United Veterans Coalition of Colorado nor Gold Star Wives is seeking action on such issues for 2021, and that's ideal because some groundwork is needed this year. There is no possibility of resolution until 2022 and more likely, not until 2023. There are many veterans issues on this year's schedule and it is vital to set priorities.

I'll continue efforts to contact UVC committee chairs about how they'd suggest moving forward. This kind of property tax relief is not on the list of UVC legislative objectives. UVC does have, however, the objective of legislation adding veterans with permanent and total individual "unemployability" (my thoughts) to the benefit. I like legislation rather than constitutional amendment, but certainly feel the priority should rest with action helping survivors as soon as politics and economics permit.

Here's UVC's state legislative objective. Note Item 7, which reads:

7. Support legislation to add ‘Individually Unemployable’ veterans (as defined by U.S.C.Title 38) to the Homestead Act property tax exemption

Colorado's Curious Management of its Disabled Veteran Property Tax Exemption, & the "Unemployability" Disqualification (updated May 12, 2021)

Five years ago I wrote about the curious sleight of hand employed to sell the voters on a worthy Colorado constitutional amendment but then the enabling legislation delivered a greatly watered-down statute. 

I backed off the subject after the United Veterans Committee (now United Veterans Coalition) made clear its nonsupport at that time. Understandably, it was best to avoid conflict and not mess up the carefully-crafted UVC legislative agenda. Happily, I understand that UVC has a related bill to increase the exemption as one of the 2021 objectives. Unhappily, I feel its cost of over $19M leaves no chance of success and UVC and the bill's sponsor might instead have pushed for Gold Star Wives and/or TDIU disabled veterans.

I refer here to Referendum E from back in 2006. Our legislature generously proposed a constitutional amendment (Article X Section 3.5) to provide a small partial property tax exemption to totally disabled veterans. Note the wording: "totally disabled veterans." Let's follow that bouncing ball of how definitions of  "totally disabled veterans" kept a-changing – and to finally covered as few vets as possible:

Here is the full text of Referendum E to amend the state constitution:

"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.”

This is important: Note the "one hundred percent permanently disabled" and the separate phrase, "due to a service-connected disability." Here in Colorado those words are now interpreted to be one kind of totally disabled veteran but could be read to refer to two kinds. That's right. VA has two different types of totally and permanently disabled veterans. "TDIU" for total disability for individual unemployability" and 100% service connected disabled for vets with a disability, or group of disabilities when added together, equalling 100%. 

Here is how the Legislative Council told us via the Blue Book what we were voting for:

"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."

An overwhelming 85% of Colorado voters approved this worthy benefit for those who served our state and nation. But then the lawmakers themselves got involved and took a fire hose to the benefit, watering it down quite a bit.

When Denver finally enacted legislation for the mechanics of Article X section 3.5 to work, Referendum E ended up much less broad than what we approved. The number of qualified recipients of the benefit was cut by more than half to protect budget resources for other projects.

Here is the actual text that finally delivered Referendum E to us as law:

"(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 a one hundred percent permanent disability through disability retirement benefits pursuant to a law or regulation administered by the department."

And next, here is the Colorado Department of Military and Veterans Affairs form for applicants, where there are two portions describing "totally disabled veterans."

"A “qualifying disabled veteran” is a person who meets each of the following requirements
- § 39-3-202(3.5), C.R.S . A “qualifying disabled veteran” is a person who meets each of the following requirements - § 39-3-202(3.5), C.R.S.• The veteran sustained a service-connected disability while serving on active duty in the Armed Forces of the United States. This includes members of the National Guard and Reserves who sustained their injury during a period in which they were called to active duty. • The veteran was honorably discharged.• The federal Department of Veterans Affairs has rated the veteran’s service-connected disability as a one hundred percent permanent disability through disability retirement benefits pursuant to a law or regulation administered by the department"

– and from the back page – 

"2. DISABLED VETERAN STATUS: To qualify, both questions must be true and you must attach a copy of your VA award letter verifying that you have been given a permanent disability rating by the VA." 

CDMVA web site:

"The Disabled Veteran Property Tax Exemption is available to applicants who sustained a service-connected disability rated by the Federal Department of Veterans Affairs as a 100 percent permanent disability through disability retirement benefits pursuant to a law or regulation administered by the Department, the United States Department of Homeland Security, or the Department of the Army, Navy or Air Force. VA unemployability awards do not meet the requirement for determining an applicant’s eligibility." 

So, after all this reading, do you see where the disabled veteran property tax exemption got watered down by more than half? It was through the disqualification of veterans rated totally and permanently disabled by VA for "unemployability." Tossed into the program are the words, "VA unemployability awards do not meet the requirement for determining an applicant’s eligibility."  Note that these TDIU people aren't veterans who are out of work, but instead vets who've been evaluated as being physically unable to ever work. And are monitored to make sure that remains the case.

Side note: the constitution included as eligible veterans those who were medically retired by their service as 100% disabled. The fourteen words describing these vets were left out of the law until 2016, when HB16-1444 brought the tax legislation into accord with the constitution.

(Here is an analysis I prepared in 2016 when I last worked on disabled veteran unemployability tax exemption issues.)

VA "unemployability" is its 100% disability rating for vets with at least one 60% service-connected issue and whose overall disabilities are so severe, so far beyond the scope for which VA assigned the 60%, that any meaningful employment is impossible. VA has other rating of "catastrophically disabled" but even when a vet is rated both unemployable and catastrophically disabled, that doesn't meet CDMVA's redefinition of Referendum E also is awarded to vets with at least a 60% service-connected disability:

"Veterans are considered to be Catastrophically Disabled when they have a severely disabling injury, disorder or disease that permanently compromises their ability to carry out the activities of daily living. The disability must be of such a degree that the Veteran requires personal or mechanical assistance to leave home or bed, or require constant supervision to avoid physical harm to themselves or others."

 Let's note that VA has two kinds of unemployability awards. The first is temporary or "IU," meant for periods of uncertainty about recovery or rehabilitation after surgery or illness, and the second is permanent (TDIU) for exactly that – permanent disability for life. TDIU veterans not only are medically determined to be unable to work, they are also carefully evaluated for that situation by the Veterans Benefit Administration before given the rating. Finally, they are carefully monitored by VA to check that they remain unable to work and both Social Security and IRS records are checked. 

Because Colorado references the VA totally disabled rating everywhere, we should look at how VA itself describes a totally disabled veteran. Read carefully and compare to Colorado's absolute disqualification of TDIU vets from the Disabled Veteran Property Tax Exemption. Here is the VA Office of Inspector General's very appropriate definition:

"Veterans are considered to have total disability when they have a 100 percent disability rating due to service-connected disabilities or if their service-connected disabilities make them unemployable. For the total disability to be permanent, the law requires the disability to be “based upon an impairment reasonably certain to continue throughout life."

"The Veterans Benefits Administration Inadequately Supported Permanent and Total Disability Decisions",

    VA OIG 19-00227-226, Page ii, September 10, 2020

Clearly,  veterans with total disability, including TDIU, is what voters thought they were approving by votes for Referendum E back in 2006. So where did the Colorado prohibition of unemployability for the benefit come from?

I asked CDMVA and they said ask DOLA. I asked DOLA and in 2014 was told "some legislators" wanted that limitation. Legislators. Not the voters. Legislators introduced (snuck in!)  their own idea of
disqualification into what voters more broadly approved as our constitutional amendment.

My view: Veterans with a 100% disability rating, including TDIU, were provided the small tax exemption via Referendum E when we voted approval. TDIU eligibility should be corrected by legislative action. I do not favor broadening the Disabled Veteran Property Tax Exemption below the 100% disability level as the impact would be far too burdensome on taxpayers. 

Further, veterans often have disabilities common among folks their own age group, such as COPD, diabetes, hypertension and hearing loss. It would be unfair to a taxpayer with COPD to pay full property taxes while the veteran neighbor with a 50% COPD disability rating doesn't. The obvious need for tax relief is for survivors and the totally disabled veteran! Full stop.

Conclusion: A few legislators hijacked Referendum E and Article X Section 3.5 of the constitution, doing decades of harm to a large number of otherwise qualified Colorado totally disabled veterans and their survivors.

Time to set this right! What say you – Is 2022 too soon?

Mission Statement & Initial Plans for Gold Star Wives 2022 Property Tax Initiative

CLICK to download this 5-page outline of this goal for Gold Star Wives to get the same property tax relief as do survivors of disabled veterans.

Progress. Notes – April 16, 2021

 I have to admit, progress thus far is fairly disappointing. Mailings and phone calls for two weeks to politicians, associations, veterans, the media and everyone else I could think of have had a single response. Senator Ginia's staffer called to ask a couple questions to decide whether she'd brief her boss.

On Monday I have a Zoom call with the Governor and the Lieutenant Governor's chiefs of staff. I have questions aplenty, but don't know what their perspective is. Last year it was all about, "Nice, Wes. We'd like to offer widows the exemption but where's the money to come from?"

Here's an issue nobody in the Capitol would vote against, and we can't get traction. At age 75 and with various attention-grabbing health issues, I sure hope some champion will leap out in front of this project to take it on.

The honor nobody wants!

 

Scan our QR code for the Gold Star Wives briefing packet

Gold Star Wives Poster - Disabled Veteran Property Tax Exemption

Correct! It seems our state legislature simply didn't contemplate the possibility of Colorado soldiers, sailors, airmen and Marines dying on active duty. That's why Colorado seem to have forgotten to offer our Gold Star Wives the same widows' benefits as we provide to survivors of totally disabled veterans.

That's unjust and plain WRONG! But not a single widow of an active duty service member is permitted the Colorado Disabled Veteran's Survivor Property Tax Exemption, a small exemption saving widows between $400-$600 a year.

Why? Our state constitution's Article X Section 3.5 permits the exemption only to widows of disabled veterans already in receipt of the benefit. Dying on Active Duty means not being able to complete the application process – because the service member died first!

This is Really an Amazing and Ridiculous Catch-22!

Why is the small property tax exemption of value to Gold Star Wives?

First, it shows the state's respect and appreciation for the loss borne by these widows and widowers. The partial tax exemption would only save about $400 to $600. It would seem a minor issue to most of us. 

But look at this from a Gold Star Widow's perspective. Circumstances vary, but if eligible widows can receive half of the service member's base pay. More than half of all military deaths are E-5 and below. An Army E-5 three-stripe sergeant would have a widow pension of under $2,000 per month.

The VA has "Dependents Indemnity Compensation," where if eligible a survivor might receive $1,300 per month. So, at best, our late sergeant's widow (or widower) hopes for a modest $39,000 per year.

How far does that go? In Colorado, the average home mortgage cost is $1,700 per month, and with typical associated costs like taxes, insurance, utilities and maintenance, a monthly cost of over $2,400 or $28,000 annually. You can do the math – that leaves $916 per month for food, transportation, insurance, clothing. 

Summary: Colorado Life did a thorough report on the money necessary to live in Colorado one needs $4,317.68 per month to live in Colorado if there is a mortgage involved. Oops – that leaves our widow short by over $12,000 per year. That's why the paltry $400-$600 partial property tax exemption is important. 

The burden of property tax is a huge reason so many citizens can never afford a home, and that's even more true for military folks. That's why so few junior military own homes at the time of death and why so few widows are affected by this proposed tax exemption.

For me, I wish it was a total tax exemption as many states provide! The survivor of a service member who dies on active duty obviously have to make many, many compromises to live on $12,000 less per year than what "average" citizens need.

I think I'll do a poster based on the graphic above, but try to get the word count reduced.

GOLD STAR WIVES POSTER - COLORADO PROPERTY TAX EXEMPTION