Supreme Court Clarifies Requirements for Residential Land
Decision in three cases could help resolve hundreds of property tax disputes

by Jessica Folker
Ralph Carr Judicial Center

The Colorado Supreme Court on Feb. 18 ruled on a trio of property tax cases that, in the words of the court, help “unravel the mysteries of what constitutes ‘residential land’” under state law. The high court’s conclusions are expected to provide much-needed clarity and will help clear hundreds of pending petitions from landowners looking to lower their tax burden.

The three cases from Summit County were chosen from nearly 300 similar disputes pending before the state’s Board of Assessment Appeals. They all involve landowners — the Mooks, the Hogans and Karen Kelly — who wish to reclassify their vacant parcels as residential land, which is taxed at an assessment rate of 7.15% versus 29% for vacant land.

In its decision, the court interpreted a state statute that defines residential land as “a parcel or contiguous parcels of land under common ownership upon which residential improvements are located and that is used as a unit in conjunction with the residential improvements located thereon.”

The court came to three conclu-sions. In Mook, it found that two parcels of land must touch to be considered “contiguous.” In Hogan, the court held that a residential improvement isn’t necessary on every contiguous and commonly owned parcel in order to meet the “used as a unit” requirement. Finally, in Kelly, it found that county records determine “common ownership.”

Frank Celico, formerly of the Summit County Attorney’s office, argued the cases in court on behalf of the county’s Board of County Commissioners. He said the Supreme Court’s decision “provided bright-line rules” for determining what qualifies as res-idential land.

“These rules were very helpful from the perspective that there were numerous conflicting Court of Appeals opinions,” said Celico, who is now Summit County Assessor.

Interest in the disputes stretched far beyond Breckenridge, with more than a dozen counties — from Larimer to La Plata — filing amicus briefs. The Colorado Attorney General’s Office, representing the Board of Assessment Appeals, was also a party in the cases.

While the statutory definition of residential land has been in place for decades, it hasn’t always caused so much controversy. But as the tax rate for residential property has fallen since the Gallagher Amendment, the distinction between vacant and residential land has grown all the more important, said Summit County Attorney Jeffrey Huntley, adding he expects “there will be a need to further clarify the statute.”

To read this and other complete articles featured in the Feb. 24, 2020 print edition of Law Week Colorado, copies are available for purchase online.