Colorado officials push to save property tax breaks for seniors

Government officials in Mesa County, Colorado, urged state legislators in an open letter this week to preserve a property tax exemption for older adults and disabled veterans amid the state’s ongoing budget constraints.

Colorado’s senior property tax exemption, which has been in place for the past 25 years, cuts 50% from the first $200,000 of a home’s value for qualified homeowners — typically reducing their annual property tax bills by about $500. The program helps seniors cope with rising property taxes.

Under current rules, the state reimburses local governments for the lost revenue but only when the budget allows. But according to the state Legislative Council’s economic and revenue forecast in June, Colorado lacks the funds to issue reimbursements. In 2024, it faced a $1.2 billion budget deficit.

“In Mesa County alone, more than 11,000 residents depend on this relief, totaling roughly $5 million in local tax reduction every year,” officials wrote. “If the state fails to act, the burden shifts directly into local taxpayers.”

According to state guidelines, the exemption applies to homeowners who are at least 65 years old as of Jan. 1, have owned their property for at least 10 straight years and occupy it as their primary residence.

Property taxes have risen across Colorado since 2020, when voters repealed the Gallagher Amendment, which capped the ratio of residential to commercial property tax assessments. In 2021, the senior exemption cost the state about $156 million; next year, it’s projected to cost nearly $180 million, according to the Mesa County officials.

That’s the reality across the country. Property taxes are rising dramatically and they have the potential to hit hardest for seniors living on a fixed income. To ease the burden on senior and fixed-income homeowners, Mesa County has lowered its millage rate — the tax rate used to calculate property taxes based on assessed value.

“If the Legislature fails to fund this program now, the impact on local governments and vulnerable residents will be immediate,” the officials said. “Local taxing entities like fire districts, schools, and the county rely on these reimbursements to maintain essential services.”

This is not the first time the exemption has come under threat. While the Senior Homestead Exemption (established by voters in 2000) is constitutionally guaranteed, the state is not automatically required to reimburse local governments. Funding was suspended during a budget crisis in the early 2000s and again during the Great Recession.

“We strongly urge the Colorado Legislature to honor its long-standing commitment to seniors, disabled veterans and Gold Star families by fully funding the exemption through the general fund or by tightening other areas of the budget. Keeping this promise is far more than a budget decision — it is a moral obligation,” the officials wrote.