Court Opinion

ID: 9796544
Source: CourtListenerOpinion
Date Created: 2023-08-31 03:59:38.285806+00
Date Added: 2024-06-11T08:50:34.028365
License: Public Domain

Justice EID
dissenting:
In the Agreements at issue in this case, the Golden City Council promised that it would consider the Developers’ request for payment — nothing more. Because this promise falls far short of a “vested right,” the Golden Charter Amendment subjecting such payments to a vote of the people is not unconstitutionally retrospective. I respectfully dissent.
Significantly, the majority acknowledges that the Developers have no “vested right” under the Agreements “to payment in any particular year.” Maj. op. at 291. That is because, as the majority points out, the Agreements were written specifically to avoid the Colorado Constitution’s requirement of voter approval for the “creation of *297any multiple-fiscal year direct or indirect district debt or other financial obligation whatsoever.” Colo. Const, art. X, § 20, el. (4)(b) (“Amendment 1”); maj. op. at 291. If the Agreements do not create multi-year fiscal obligations under Amendment 1, they do not create such obligations for purposes of the retrospeetivity analysis either.
The majority seems to concede this analysis, but concludes that the Developers have a non-fiscal vested right in the Agreements— namely, the “reasonable expectation that the City Council would exercise its budgetary discretion in determining whether to appropriate funds annually.” Maj. op. at 292-93. One might question whether this right to the exercise of the City Council’s discretion is actually the right the Developers seek to protect; as the court of appeals noted, the ultimate goal of the Developers is to receive payment, which is clearly not a “vested right” under the Agreements. See Parker v. City of Golden, 119 P.3d 557, 563 (Colo.App.2005). But even if the majority’s description of the “right” in question is accurate, it simply does not qualify as “vested” under our jurisprudence.
Petitioners are claiming a vested right in the Council’s ability to exercise its discretion to approve payment to the Developers without a vote of the people. But this “right” to voter-free Council discretion is nowhere found in the language of the Agreements. On the contrary, the language of several of the Agreements tracks the language of a Golden ordinance providing that “[n]o vested property right or other such property interests or rights shall be granted or impliedly conferred upon any person or entity” through the economic incentives program. G.M.C. § 18.60.080. The majority downplays the effect of this language by stating that it pertains only to planning and zoning. See maj. op. at 296. But a more common-sense reading of the language is that the Golden City Council at the time the Agreements were made wanted to protect itself from the very sort of “vested right” claims that the Developers raise in this case. Nor could the Council even promise voter-free discretion, for the Council’s discretion to appropriate funds was always subject to change through voter initiative.1 Moreover, as the majority acknowledges, the Agreements were made after the Golden voters had rejected a proposed multi-year economic incentives package with one of the Developers in this case. See maj. op. at 288. Under these circumstances, the Developers’ claim of thwarted expectations in voter-free appropriations is at best dubious.
The majority proceeds to find a vested right to voter-free Council discretion in the covenant of good faith and fair dealing, see maj. op. at 292-93, which “applies when one party has discretionary authority to determine certain terms of the contract, such as quantity, price, or time.” Amoco Oil Co. v. Ervin, 908 P.2d 493, 498 (Colo.1995). We held in Amoco that the duty requires parties to act in good faith when exercising their contractual discretion. See id. But the good-faith exercise of contractual discretion is an entirely separate question from whether such discretion can be limited by the voters when their government contracts with a private party. On this question — which is the central question in this case — our precedents applying the implied covenant are inapplicable.
Even if the implied duty of good faith were applicable to this ease, the majority fails to explain how it has been violated. The majority believes that the Developers “had a reasonable expectation that the City Council would exercise its budgetary discretion in determining whether to appropriate funds annually.” Maj. op. at 292-93. But there is no claim that the Council somehow exercised its discretion in bad faith, as would be the case if payments were due under the Agreements’ formula and the Council refused to pay them. The duty of good faith and fair dealing requires that discretion be exercised in good faith; it does not guarantee that a *298particular form of government discretion will be insulated from voter change.2
At bottom, the Developers claim to have a vested right to a particular method of government decision-making. We define such interests in “remedies or modes of procedure” as “procedural,” and we have repeatedly stated that there can be no vested right “where the statute effects a change that is procedural” in nature. In re Estate of De-Witt, 54 P.3d 849, 854 n. 3, 854 (Colo.2002); see also People v. D.K.B., 843 P.2d 1326, 1331-32 (Colo.1993) (finding that a statute repealing a certain procedure for sealing arrest and criminal records did not impair a “vested right”). The reason for this is plain. Government must have a certain amount of flexibility with regard to the procedures it follows. Under the majority’s logic, once a government entity enters into a contract with a private party, its budgeting process is frozen in place and cannot be changed with regard to that party. Although this case arises in the context of a voter initiative, its logic would apply to any change in the governmental budgeting process — voter-initiated or not. Nothing in the Colorado Constitution requires such a result.
The majority acknowledges that the Charter Amendment need only be supported by “a legitimate government interest” to survive a retrospectivity challenge. Maj. op. at 290. Moreover, it goes on to identify that interest in this case — “limiting public expenditures.” Id. at 293. Indeed, as the majority points out, “prospective application of the Charter Amendment promotes the public interest of limiting future public expenditures.” Id. at 293. Ironically, this is precisely what Respondent Parker is arguing in support of the Amendment’s constitutionality: that application of the Charter Amendment’s requirement of voter approval for payments over $25,000 made to the Developers in the future will keep down public expenditures.3 See maj. op. at 291, 293 (characterizing Respondent’s argument).
Despite its recognition of the legitimate government interest supporting the Charter Amendment, the majority goes on to find that the interest is outweighed by the significant benefits of Golden’s economic incentives program. See id. at 293. It applauds the city’s initiative in “encourag[ing] development” and “discouraging urban sprawl.” Id. at 293. The majority also places a premium on the need for Golden to “honor[ ] its commitments,” id. at 293-94, though this begs the question of whether those commitments constitute a “vested right” in the first place. The majority’s application of rational basis review bears little resemblance to “the most deferential standard of judicial review.” Parrish v. Lamm, 758 P.2d 1356, 1370 (Colo.1988).
Because the City Council’s promise to consider payment to the Developers does not confer any “vested right” upon them, the Charter Amendment subjecting such payments to voter approval is not unconstitutionally retrospective. I respectfully dissent.
I am authorized to state that Justice COATS joins in this dissent.

. The Petitioners acknowledge that the Council’s "authority to appropriate funds to grant economic subsidies or incentives is subject to the restrictions of the Charter Amendment." Pet.'s Reply Brief at 13. They simply challenge the constitutionality of the Charter Amendment’s application to their Agreements.

. The majority relies on People v. McNichols, 91 Colo. 141, 143, 13 P.2d 266, 267 (1932), for the proposition that "[cjourts ... will direct an officer to proceed and exercise the discretion vested in him by law.” Maj. op. at 292 (emphasis added). The point here is that, after the passage of the Charter Amendment, the City Council was no longer "vested” with the "discretion ... by law” free from voter approval of payments over $25,000.

. The majority assumes that the Charter Amendment applies retroactively to the Agreements in question, on the ground that the trial court and court of appeals made such an assumption. See maj. op. at 291. Under my analysis, it does not matter whether the Charter Amendment applies prospectively or retroactively because the Agreements contain no "vested right” to be impaired by the Amendment.