v. Nat'l Fed'n of Indep. Bus, 2019 CO 79

Background

Colorado’s Department of State has collected charges for services (e.g., business licensing) since statehood; in 1983 the legislature authorized a funding mechanism crediting collected charges to a Department cash fund and directed fees be adjusted to “approximate [the Department’s] direct and indirect costs.”
The statute (§ 24-21-104) gives the Secretary discretion to set, increase, decrease, or suspend fees without a statutory formula or preset adjustment mechanism.
TABOR (adopted 1992) requires voter approval for any new tax, tax rate increase, or tax policy change that directly causes a net revenue gain; TABOR applies prospectively but can invalidate post‑TABOR implementation of pre‑TABOR statutes if they effect such changes.
NFIB sued (2014), alleging the Department’s charges are taxes and that post‑TABOR fee adjustments constituted new taxes/tax‑rate increases or tax‑policy changes requiring voter approval.
The trial court granted summary judgment for the State, finding NFIB presented no evidence that post‑TABOR adjustments caused a net revenue gain; a division of the court of appeals reversed and remanded for further factual development.
The Colorado Supreme Court granted certiorari, reversed the court of appeals, reinstated the trial court’s summary judgment, and declined to decide whether the charges are “taxes” under TABOR because NFIB failed to show any post‑TABOR adjustment produced a net revenue gain.

Issues

Issue	Plaintiff's Argument (NFIB)	Defendant's Argument (State/Griswold)	Held
Whether the court of appeals properly remanded for further development of the factual record before deciding summary judgment	The stipulated record still shows repeated post‑TABOR fee increases and policy changes requiring factual development to determine whether voter approval was needed	The record (stipulations) contained no evidence that post‑TABOR adjustments caused a net revenue gain; remand was improper because NFIB failed to meet its burden to show a triable issue	Reversed court of appeals; remand was improper—petitioners met initial summary judgment burden and NFIB failed to show a genuine dispute of material fact
Whether post‑TABOR adjustments to fees constituted a new tax, tax‑rate increase, or tax‑policy change that directly caused a net revenue gain under TABOR	Adjustments were discretionary and non‑ministerial and therefore, absent voter approval, violate TABOR because they functioned as taxes or tax increases after 1992	Adjustments implemented a pre‑TABOR statutory scheme and the record contains no evidence that Secretary’s adjustments produced a net revenue gain attributable to fee changes rather than increased filings	Held for State: NFIB produced insufficient evidence that any post‑TABOR adjustment resulted in a new tax, tax‑rate increase, or tax‑policy change causing net revenue gain
Whether the business and licensing charges are "taxes" under TABOR	The charges lack a reasonable relationship to the services funded and thus their primary purpose is revenue for general government use, making them taxes subject to TABOR	Charges are authorized by statute and meant to approximate direct and indirect costs of services; characterization not necessary if NFIB cannot show a TABOR‑triggering revenue gain	Not decided: Court expressly declined to reach whether the charges are taxes because NFIB failed on the narrower showing needed to trigger TABOR voter‑approval requirements

Key Cases Cited

Colo. Union of Taxpayers Found. v. City of Aspen, 418 P.3d 506 (Colo. 2018) (tests whether a charge is a tax or a fee based on primary purpose)
Huber v. Colo. Mining Ass’n, 264 P.3d 884 (Colo. 2011) (ministerial/statutory formula adjustments to pre‑TABOR schemes do not violate TABOR)
TABOR Found. v. Reg’l Transp. Dist., 416 P.3d 101 (Colo. 2018) (construing “new tax” and “tax policy change” to require more than mere change; incidental or de minimis increases do not trigger TABOR)
Nicholl v. E‑470 Pub. Highway Auth., 896 P.2d 859 (Colo. 1995) (pre‑TABOR financing plans implemented after TABOR did not create a new obligation that violated TABOR)
Bolt v. Arapahoe Cty. Sch. Dist. No. Six, 898 P.2d 525 (Colo. 1995) (ministerial implementation of pre‑TABOR statutory authorizations does not require voter approval)
In re Submission of Interrogatories on Senate Bill 93‑74, 852 P.2d 1 (Colo. 1993) (describes TABOR’s purpose and limits on government taxing authority)
Civil Serv. Comm’n v. Pinder, 812 P.2d 645 (Colo. 1991) (summary judgment standard: moving party may prevail by showing absence of evidence supporting nonmoving party)