2018 CO 29
Colo.2018Background
- In 2013 the Colorado General Assembly enacted H.B. 13-1272 to realign RTD and SCFD sales-tax exemptions with the State’s sales tax to simplify administration and reduce vendor burdens.
- The bill removed certain exemptions (e.g., cigarettes, candy, soft drinks, nonessential food containers, direct-mail materials) and added others (e.g., low-emitting vehicles, machinery); SCFD also gained a vending-machine food exemption.
- The staff fiscal note projected a net revenue increase for the two districts of about 0.6% (≈ $2.7M for RTD and $250K for SCFD), against combined annual tax revenues of ~ $515M and budgets of ~ $2.835B.
- TABOR (Colo. Const. art. X, § 20(4)(a)) requires voter approval for any “new tax” or “tax policy change directly causing a net tax revenue gain.”
- TABOR Foundation sued, claiming H.B. 13-1272 was a new tax or tax-policy change requiring voter approval; trial court granted summary judgment to the districts; the court of appeals affirmed; the Colorado Supreme Court granted certiorari.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether H.B. 13-1272 enacted a “new tax” under TABOR | Any statutory change that increases tax revenue constitutes a new tax and needs voter approval | The bill merely adjusted exemptions for administrative simplicity; it did not create a new, distinct tax | Not a new tax when the revenue increase is incidental and de minimis; H.B. 13-1272 is not a new tax |
| Whether H.B. 13-1272 effected a “tax policy change directly causing a net tax revenue gain” | Removing exemptions that raise revenue is a tax-policy change triggering TABOR | The change was administrative, incidental to the bill’s purpose, and produced only a de minimis increase relative to districts’ revenues/budgets | Not a tax policy change where the increase is incidental and de minimis; the 0.6% increase is de minimis and incidental |
Key Cases Cited
- Mesa County Bd. of Cty. Comm’rs v. State, 203 P.3d 519 (Colo. 2009) (de minimis/incidental revenue changes should not be treated as TABOR tax-policy changes)
- Barber v. Ritter, 196 P.3d 238 (Colo. 2008) (distinguishing fees and taxes; incidental revenue does not convert a fee to a tax)
- City of Florence v. Pepper, 145 P.3d 654 (Colo. 2006) (courts should avoid broader constitutional rulings when a narrower non-constitutional resolution suffices)
- Campaign Integrity Watchdog v. All. for a Safe & Indep. Woodmen Hills, 409 P.3d 357 (Colo. 2018) (statutory and constitutional interpretation principles)
- Dean v. People, 366 P.3d 593 (Colo. 2016) (presumption of constitutionality and the "beyond a reasonable doubt" standard)
- In re Great Outdoors Colo. Tr. Fund, 913 P.2d 533 (Colo. 1996) (avoid constructions that render words superfluous)