I spoke with the JAG and my wife spoke with a local attorney here in COS. Both claimed that 2-3 months rent for penalty for early termination was normal AND the landlord is required by CO law to attempt to mitigate his loses by trying rent the place out. He has stated that he has no intention of renting it out until September.
We submitted an offer of 3 months rent, which was denied, and he countered with $17,737.50 (25% of the remaining lease)

without utilities.
My HR department laughed again at his request so we're heading downtown today to meet with the attorney. We originally planned on departing today for our PCS to the East Coast but that's been pushed back.
It seems that I consider our lease as a contract for services (money exchanged for living in his house for a specified term) whereas the landlord views the lease as a promissory note (I will give him X in equal monthly payments for Y months).
Lesson Learned: ensure all leases include a civilian PCS clause (our property manager back in MD said it was common practice back there).
I really hate unnecessary drama too.