In a series of rulings Tuesday, the Colorado Supreme Court decided that the COVID-19 pandemic was not a “detrimental act of nature” necessitating lower property taxes.
In four unanimous opinions, the high court considered legal cases out of Jefferson, Broomfield, Douglas and Larimer counties in which hundreds of commercial property owners sued county tax authorities, seeking lower tax assessments for 2020 due to the pandemic.
Property valuations in Colorado are calculated during odd-numbered tax years, except when “unusual conditions” dictate that a property be revalued. The property owners in the four cases argued that the unusual conditions of 2020 necessitated lower revaluations.
State law defines “unusual conditions” as changes to a property or “detrimental acts of nature.” The question before the Supreme Court was whether the pandemic fell into that latter category.
“To fall within this provision, the unusual condition must be both an ‘act of nature’ and ‘in or related to any real property’ … COVID-19 meets neither,” Justice Monica Márquez wrote.
“It did not resemble the natural events — earthquakes, floods, and tornados — that we consider acts of nature,” the justice added. “Moreover … COVID-19 may have infected people who were on the property but COVID-19 did not infect the property itself.”
Eleven lawsuits were filed in fall 2020 by commercial property owners in Colorado who believed that counties should revalue their properties in the wake of public health orders that closed their businesses and therefore drastically reduced their profitability.
Courts in those 11 counties interpreted the issue differently, so the Colorado Court of Appeals considered the cases and ruled last October that assessors should at least consider the pandemic’s detrimental effects when deciding whether to revalue properties. The matter then went to the Supreme Court, which heard oral arguments in January.
In all four cases, the property owners were represented by attorney James Bick Jr. of Missouri, along with Glen Gordon and Matthew Simonsen with Hutchinson Black and Cook in Boulder.
The assessors were represented by the county attorney’s office for each county.
In 2021, when county assessors released new valuations as part of the regular two-year cycle, the overall valuation of commercial property in Denver dropped for the first time since the Great Recession. Overall valuations rose this year, with hotel and retail properties leading the way while downtown office properties remained flat.