Losing a family member is never easy, but Colorado Amendment E could help Gold Star Spouses financially through a tax exemption.
Amendment E would expand the current homestead property tax exemption (more on this below) to reduce the property taxes paid by a homeowner who is the surviving spouse of either a military service member killed in the line of duty, or a veteran whose death resulted from a service-related injury or disease. Families who lose a family member in combat or other service are referred to as Gold Star Families – a term that originated in World War I – and Amendment E pertains to Gold Star Spouses.
It’s a Constitutional amendment, and will need 55% of the vote to pass. The Colorado General Assembly put Amendment E on the ballot as a referred measure through House Concurrent Resolution 22-1003. The resolution passed both the House and Senate unanimously.
The homestead tax exemption is also sometimes known as the “senior tax exemption,” since to qualify today, a homeowner must be at least 65 years old and must have lived in their home for at least 10 years. If people qualify, they can get 50% off their property tax burden on the first $200,000 of the home’s assessed value – for example, a qualifying homeowner with property valued at $500,000 would get a break on the first $200,000 but not on the remaining $300,000. This person with a home valued at $500,000 would see a typical tax break of about $630, according to State of Colorado information, but the actual amount of the tax exemption would be based on the property’s value.
While a property tax break can be a wonderful benefit for people living on limited incomes, property tax revenues fund many local services. Most significantly, county governments and school districts depend very heavily on property taxes, as do certain special districts. Municipal governments may also use property tax revenues, though they tend to be more dependent on sales and use taxes in many cases. The State of Colorado must reimburse counties for lost revenue due to the homestead exemption, so the exemption program includes a cost to the state, and the General Assembly has the authority to cancel, reduce, or increase the exemption based on economic conditions or other considerations.
In 2021, the state reimbursed counties $162.1 million in homestead exemptions, of which $156.5 million was for senior homestead exemptions and $5.6 million for veterans with a disability. According to the state Blue Book, an estimated 490 surviving spouses who are not otherwise able to claim the homestead exemption would be eligible for the new exemption under Amendment E in property tax year 2023. Amendment E will increase state spending by an estimated $288,000 in state budget year 2023-24 to cover reimbursements to counties.
Pro:
- Spouses of those who died in service may face economic challenges on top of their emotional grief. Amendment E can help them afford isolated bills or expenses.
Con:
- Expanding the homestead exemption will cost the state additional money.
Richard’s Take
I’ll support Amendment E and urge a “yes” vote.
The ballot measure would very clearly provide a nice little benefit for people who lost their spouse as a result of military service. It’s a high-quality gesture on behalf of the State of Colorado, and unlike some measures on this year’s ballot it does not seem to pack a huge fiscal punch.
There is plenty of discussion in Colorado about the homestead exemption in general – including opinions that the cap should be higher than $200,000, that it doesn’t do enough for Coloradans with skyrocketing property values but limited income, and that it can be rescinded or reduced during tough economic times. These are all fair things to debate into the future, but to me they should not influence a decision on Amendment E.
