Source: https://cbaclelegalconnection.com/tag/tabor/
Timestamp: 2019-04-25 17:48:20+00:00

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The Colorado Supreme Court issued its opinion in Colorado Union of Taxpayers Foundation v. City of Aspen on Monday, May 21, 2018.
The supreme court considered whether a $0.20 charge on paper bags is a tax subject to the Taxpayer’s Bill of Rights (TABOR). The court held that if the primary purpose of a charge is to raise revenue for the general expenses of government, the charge is a tax. Conversely, the court concluded that a charge is not a tax if the primary purpose of a charge is to defray the reasonable direct and indirect costs of providing a service or regulating an activity, because such a charge does not raise revenue for the general expense of government.
After analyzing the charge in this case, the court held that this charge is not a tax. Aspen imposed this charge as part of a regulatory program aimed at waste management, and the $0.20 charge for the right to use a paper bag bears a reasonable relationship to Aspen’s cost of permitting that use. Because this charge is a not a tax, it is exempt from TABOR’s requirements.
The court affirmed the court of appeals’ judgment.
The Colorado Supreme Court issued its opinion in TABOR Foundation v. Regional Transportation District on Monday, April 23, 2018.
To simplify tax collection and ease administrative burdens, House Bill 13-1272 realigned the sales taxes for the Regional Transportation District and the Scientific and Cultural Facilities District with the State’s sales tax. This involved removing some sales tax exemptions and adding others, resulting in a projected 0.6% net revenue increase for the Districts. The TABOR Foundation sued, arguing that H.B. 13-1272 violated theTaxpayer Bill of Rights, Colo. Const. art. X, § 20(4) (“TABOR”), by making this tax change without first obtaining voter approval.
The supreme court held that legislation like H.B. 13-1272 that causes only an incidental and de minimis tax-revenue increase does not amount to a “new tax” or a “tax policy change” under TABOR section 4. Because the court of appeals correctly determined that H.B. 13-1272 was constitutional, the supreme court affirmed its judgment.
The Colorado Court of Appeals issued its opinion in TABOR Foundation v. Regional Transportation District on Thursday, June 30, 2016.
TABOR—Summary Judgment—H.B. 13-1272—Constitutionality and Beyond a Reasonable Doubt Standard.
In 2009 and 2010 the General Assembly removed the state sales tax exemption for certain items but the exemption remained in place for the Regional Transportation District (RTD) and the Scientific and Cultural Facilities District (SCFD) (collectively, the Districts). To conform these exemptions, in 2013 the General Assembly enacted HB 13-1272, granting the Districts “the power to levy uniformly throughout the district a sales tax at any rate that may be approved by the board, upon every transaction or other incident with respect to which a sales tax is now levied by the state.” In 2014 the Districts began collecting taxes on some previously exempted items. The TABOR Foundation and Penn Pfiffner (the Foundation) brought this action challenging the Districts’ collection of these taxes on the grounds that they were subject to TABOR’s “voter approval in advance” requirement because they constitute a new tax and a tax policy change. The trial court disagreed, applying the unconstitutional beyond a reasonable doubt standard, and granted the Districts’ motions for summary judgment.
The Court of Appeals first affirmed application of the “beyond a reasonable doubt” standard to the constitutionality of the house bill. The Court then concluded that HB 13-1272 does not impose a new tax, but, even if it did, the RTD had received prior voter approval because it was initially authorized to impose a sales tax on “every taxable transaction, now and in the future,” and the SCFD was granted the authority to impose taxes “currently, or in the future, levied and collected.” The Court also concluded that the house bill did not constitute a tax policy change because the Districts always had the authority to impose a broad sales tax.
The Colorado Court of Appeals issued its opinion in Colorado Union of Taxpayers Foundation v. City of Aspen on Thursday, November 5, 2015.
Summary Judgment—TABOR—Waste Reduction Fee—Tax Versus Fee.
In 2011, the City of Aspen adopted an ordinance prohibiting grocers from providing customers with disposable plastic bags and requiring grocers to charge customers a waste reduction fee of $.20 for each disposable paper bag provided. For the first year, grocers were permitted to retain 25% of each fee collected up to $1,000 per month. Thereafter, grocers were permitted to retain no more than $100 per month. The remaining fees were deposited into the City’s Waste Reduction and Recycling Account. In August 2012, the Colorado Union of Taxpayers Foundation (Foundation) sued the City, alleging that the enactment of the ordinance without first obtaining voter approval violated TABOR. After a hearing on cross-motions for summary judgment, the district court concluded that the ordinance was neither subject to nor unconstitutional under TABOR.
On appeal, the Foundation argued that the trial court erred in finding that the ordinance created a fee rather than a tax and therefore was not subject to TABOR. The Court of Appeals disagreed. The primary purpose of the ordinance was to reduce waste, and the majority of the funds raised from the fee went to providing reusable bags to residents and visitors. The rest of the funds were used to finance particular services related to the reduction of trash and waste, and to fund education about those matters. The fees do not revert to the general fund but stay in an account to fund the foregoing. To date, there had been no surplus revenues from the funds.
There is a presumption that the court should choose an interpretation of TABOR that would create the greatest restraint on the growth of government. That presumption applies where multiple interpretations of TABOR are equally supported by the text. Here, the Court found that the text of the ordinance did not equally support the Foundation’s interpretation of the fee as a tax. Therefore, the presumption did not apply. The judgment was affirmed.
The Colorado Court of Appeals issued its opinion in TABOR Foundation v. Colorado Bridge Enterprise on Thursday, August 14, 2014.
In 1992, Coloradans adopted the Taxpayer’s Bill of Rights (TABOR), which limits the power of the state, its subdivisions, and its districts to levy taxes or create debt. TABOR requires voter approval for any new tax and for the issuance of debt. Enterprises, as defined by TABOR, are exempt from TABOR’s voter approval requirements. In 2009, the General Assembly created the Colorado Bridge Enterprise (CBE). CRS § 43-4-805authorizes the CBE to impose a bridge safety surcharge to finance, repair, reconstruct, and replace any designated bridge in the Colorado highway system, without being subject to TABOR.
In 2012, the TABOR Foundation (Foundation) commenced this action, asserting that the CBE was subject to TABOR. The trial court held that the CBE did not levy a TABOR-prohibited tax when it imposed a bridge safety surcharge, but instead imposed a permissible fee. It further held that the CBE operates as a TABOR-exempt enterprise and did not violate TABOR by issuing bonds without submitting the matter to voters in a statewide election.
On appeal, the Foundation contended that the bridge safety surcharge is a tax because it is collected without regard to any services used by the vehicles for which the charge is imposed, and thus fails to meet the definition of a TABOR-exempt fee. The Court of Appeals disagreed. The General Assembly’s primary purpose was to create a charge that would finance a particular service. Further, the charge can be imposed only for the purpose of financing, repair, reconstruction, and replacement of designated bridges. The money raised by the surcharge could never be used for general government purposes. Further, it is not determinative that persons registering their vehicles might never use a CBE bridge. Therefore, the bridge safety surcharge is a fee, not a tax.
The Foundation also contended that the trial court erred in finding that the CBE is an enterprise exempt from TABOR requirements. CBE is a business because it pursues a benefit and generates revenue by collecting fees from service users. Also, CBE is authorized to issue its own revenue bonds and receives less than 10% of annual revenue in grants from all Colorado state and local governments combined. Therefore, it is an enterprise exempt from TABOR requirements. The judgment was affirmed.
The Tenth Circuit Court of Appeals issued its opinion in Kerr v. Hickenlooper on Tuesday, July 22, 2014.
This appeal was a request for en banc rehearing on the previously published decision in Kerr v. Hickenlooper. Rehearing by the original panel was denied. The petition was circulated to all the judges of the court, excluding Judge Matheson, who recused, and a majority of the court voted to deny rehearing. Four judges would have allowed en banc rehearing – Judges Hartz, Tymkovich, Gorsuch and Holmes. Judges Hartz, Tymkovich, and Gorsuch wrote dissents to the denial.
The Tenth Circuit Court of Appeals published its opinion in Kerr v. Hickenlooper on Friday, March 7, 2014.
Various groups, and in particular, several Colorado state legislators, brought an action in the U.S. District Court for the District of Colorado. They claimed that the so-called Taxpayer’s Bill of Rights, TABOR, violated the Guarantee Clause of the federal Constitution, was in direct conflict with provisions of the Enabling Act, and impermissibly amended the Colorado Constitution.
In order to avoid Eleventh Amendment sovereignty issues, the Governor of Colorado, John Hickenlooper, was designated as the named defendant. Governor Hickenlooper filed his Answer to the plaintiffs’ Complaint, and followed with a motion to dismiss, alleging that plaintiffs lacked Article III standing and prudential standing, and that their claims were barred by the political question doctrine. This motion was denied by the district court, and the Governor appealed, asserting error and asking the Tenth Circuit to dismiss the proceedings on the same bases that he presented to the district court.
The merits of the case were not before the court. The court expressed no view on the substantive issues. It considered solely standing and the political question doctrine: whether these plaintiffs had suffered a particularized injury not widely shared by the general populace that entitled them to have their case heard by the federal courts, and whether the question presented was purely political in nature and should not be reached by the courts.
The Tenth Circuit concluded that these plaintiffs could bring their claims and that the political question doctrine did not bar the court’s consideration.
Article X, § 20 of the Colorado Constitution—better known as the Taxpayer’s Bill of Rights or TABOR—was adopted by voter initiative in 1992. TABOR limits the revenue-raising power of the state and local governments by requiring voter approval in advance for any new tax, tax rate increase, mill levy above that for the prior year, valuation for assessment ratio increase for a property class, or extension of an expiring tax, or a tax policy change directly causing a new tax revenue gain. Like all provisions in Colorado’s Constitution, TABOR may be revoked or amended only with voter approval.
To establish Article III standing, a plaintiff must show: (1) that it has suffered a concrete and particular injury in fact that is either actual or imminent; (2) the injury is fairly traceable to the alleged actions of the defendant; and (3) the injury will likely be redressed by a favorable decision. Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992). The court limited its review to the standing of the legislator-plaintiffs.
Plaintiffs claimed that they had been deprived of their power over taxation and revenue. Under TABOR, the state “must have voter approval in advance for . . . any new tax, tax rate increase, . . . or a tax policy change directly causing a net tax revenue gain to any district,” with narrow exceptions. Under TABOR, a legislative vote for a tax increase is completely ineffective because the end result of a successful legislative vote in favor of a tax increase is not a change in the law. TABOR denies the Colorado General Assembly the “ability to vote” on operative tax increases, and the legislator-plaintiffs cannot undo its provisions pursuant to the normal legislative process. The legislator plaintiffs’ injury is their disempowerment rather than the failure of any specific tax increase. The Tenth Circuit agreed with the district court that the legislator-plaintiffs sufficiently alleged an injury to the plain, direct and adequate interest in maintaining the effectiveness of their votes. The court therefore held that plaintiffs suffered an injury in fact, and thus proceeded to a brief discussion of causation and redressability.
To satisfy causation for standing purposes, plaintiffs must demonstrate that their injury is fairly traceable to the challenged action of the defendant. And an injury is redressable if a court concludes it is likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision. The legislator-plaintiffs’ alleged injury was not a lack of revenue flowing into state coffers, but the elimination of their authority to make laws raising taxes or increasing spending. This injury was directly attributable to TABOR’s requirement that any tax increase be approved by Colorado voters. Plaintiffs sought a declaratory judgment that TABOR is null and void and an order prohibiting any state officer from enforcing TABOR’s provisions. Such a judgment would allow the legislator-plaintiffs to vote directly for increased taxes, thereby redressing their alleged injury.
In addition to the Article III requirements for standing, the court also discussed prudential standing considerations. Courts should generally decline to hear cases based on nothing more than a plaintiff’s disagreement with budgetary policies. The court did not doubt that TABOR has had a substantial effect on the state of Colorado and its citizens. But the injury the legislator-plaintiffs sought to redress was particular to their positions as state legislators and was not shared in substantially equal measure by all or a large class of citizens. Only the one hundred members of the Colorado General Assembly could claim the disempowerment injury alleged here.
The court then turned to the political question doctrine. The political question doctrine excludes from judicial review those controversies which revolve around policy choices and value determinations constitutionally committed for resolution to the halls of Congress or the confines of the Executive Branch.
As a threshold matter, the court had to decide if the political question doctrine precluded Guarantee Clause challenges against state constitutional amendments adopted by popular vote. Although there was some support for this position in Supreme Court cases predating the modern articulation of the political question doctrine, the court concluded neither case merited consideration in this case.
Applying the six factors set forth in Baker v. Carr, 369 U.S. 186 (1962), the court first considered whether the Guarantee Clause manifests “a textually demonstrable constitutional commitment of the issue to a coordinate political department.” The Guarantee Clause provides: “The United States shall guarantee to every State in this Union a Republican Form of Government, and shall protect each of them against Invasion; and on Application of the Legislature, or of the Executive (when the Legislature cannot be convened) against domestic Violence.” Two other provisions of Article IV specifically empower Congress to act, but the Guarantee Clause does not. Looking to the particular fact setting presented, as Baker directed, the court discerned no textual commitment of the narrow issue raised by the plaintiffs to a coordinate political branch.
The court was similarly unpersuaded that a “lack of judicially discoverable and manageable standards” precluded judicial review of this lawsuit. Without reaching or considering the merits, the court noted the ready availability of sources providing judicially manageable guidance on the meaning of the Guarantee Clause.
With respect to the third Baker test, the Tenth Circuit concluded that resolving this case did not require the making of a “policy determination of a kind clearly for nonjudicial discretion.” TABOR is a hotly contested issue in Colorado that has had a wide-ranging influence on the state’s fiscal policy. But the interpretation of constitutional text—even vague constitutional text—is central to the judicial role.
The court dispensed briefly with the remaining three Baker factors: “ the impossibility of a court’s undertaking independent resolution without expressing lack of the respect due coordinate branches of government; or  an unusual need for unquestioning adherence to a political decision already made; or  the potentiality of embarrassment from multifarious pronouncements by various departments on one question.” The court stated that these factors are best understood as promoting separation-of-powers principles in cases featuring prior action on an issue by a coordinate branch.
The court emphasized that this interlocutory appeal allowed it to consider only whether the legislator-plaintiffs established Article III standing and whether prudential standing jurisprudence or the political question doctrine precluded consideration of their Guarantee Clause and Enabling Act claims. The Tenth Circuit’s answer to those questions completed its role at this stage of the proceedings.
The Tenth Circuit AFFIRMED the standing and political question rulings of the district court and REMANDED for further proceedings.

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