Colorado LegiSource

An informational and educational resource for the Colorado General Assembly by the Office of Legislative Legal Services.

Author: olls

  • Wayfair Decision Changes Commerce Clause Jurisprudence

    by Esther van Mourik

    Loyal LegiSource readers are already experts in the Commerce Clause of the United States Constitution. (See: “United States Supreme Court Effectively Upholds Colorado Internet Sales Tax Law”) Well, this summer the United States Supreme Court (Supreme Court) issued an opinion that made significant changes in Commerce Clause jurisprudence!

    South Dakota v. Wayfair is a case about e-commerce, a term used to describe purchases made from online retailers like Amazon, Wayfair, eBay, Newegg, and countless others. As described in earlier articles, until the Wayfair decision, when you made a purchase from an online retailer and the online retailer did not have physical presence in your state of residence, your state’s revenue department was not allowed to require that retailer to collect the sales tax owed on that purchase. Instead, you were required to pay the tax (now called use tax) on those purchases yourself. Unsurprisingly, most people did not voluntarily remit the use taxes they owed.

    While states have nearly complete authority to tax commercial activities within their own borders, these broad taxing powers are subject to limitations in the United States Constitution when the commerce goes beyond the state’s borders. The Commerce Clause reserves to Congress the power to “regulate commerce . . . among the several states.” In general, a state law cannot discriminate against or unduly burden interstate commerce, even in the absence of federal legislation regulating the activity. In addition, a Supreme Court decision frequently referenced as “the Quill case” stood for the rule that states could not require retailers to collect the sales tax from consumers if the retailer did not have physical presence in the consumer’s state of residence.

    The Quill case was decided in 1992, well before the era of e-commerce as we know it now. Consequently, the physical presence requirement became a big hurdle for states seeking parity between online purchases and purchases made in local stores. Many people figured it made more sense to buy an item online and not be charged sales tax rather than purchasing the same item in a local store where the price reflects the sales tax owed (conveniently ignoring the use taxes that were still due). The lost sales tax revenue provoked many states to deal with this issue in two ways: first, through numerous attempts to seek congressional action (not successful); and second, by individual states passing legislation that challenged the physical presence requirement (a description of Colorado’s effort can be found here). In 2016, South Dakota took the most direct position, passing a law requiring a retailer without physical presence in the state to collect sales and use tax on purchases and services at the point of sale. The legislative declaration even described the bill as a direct challenge to the Quill case.

    Wayfair, Overstock, and Newegg sued South Dakota, arguing that the law was unconstitutional under the Commerce Clause. The South Dakota trial court found for the companies, and the South Dakota Supreme Court agreed, relying on the fact that the Quill case had not yet been overturned and still required physical presence in South Dakota before companies could be forced to collect the sales tax. South Dakota appealed to the Supreme Court. In its June 21, 2018, opinion, the Supreme Court overruled Quill, holding that “the physical presence rule, both as first formulated and as applied today, is an incorrect interpretation of the Commerce Clause.” This means that the South Dakota law is constitutional insofar as a company’s physical presence is no longer required. However, the case was remanded back to South Dakota to determine whether the law is discriminatory or an undue burden on interstate commerce.

    The Supreme Court stated, however, that, “South Dakota’s tax system includes several features that appear designed to prevent discrimination against or undue burdens upon interstate commerce.” The Court focused on the following three particulars:

    • The South Dakota law defined “retailer” as a business with annual gross sales revenue in the state exceeding $100,000 or having made 200 or more separate sales transactions in the state in a year;
    • The law was not retroactive; and
    • South Dakota had already adopted the Streamlined Sales and Use Tax Agreement.

    So where does this leave Colorado? The Colorado Department of Revenue (Department) recently moved toward requiring retailers without physical presence (out-of-state retailers) to collect state sales tax and the sales taxes levied by certain cities, counties, and special districts that are currently collected and distributed by the Department. In addition, the Department adopted emergency rules to assist in administering the sales tax collections and, among other things, to specify that the state’s collection requirement would not be retroactive and would apply to the same definition of retailer that South Dakota adopted.

    However, Colorado has not adopted the Streamlined Sales and Use Tax Agreement. In the Wayfair decision the Supreme Court described the agreement as follows:

    This system standardizes taxes to reduce administrative and compliance costs: It requires a single, state level tax administration, uniform definitions of products and services, simplified tax rate structures, and other uniform rules. It also provides sellers access to sales tax administration software paid for by the State. Sellers who choose to use such software are immune from audit liability.

    The Colorado Constitution provides home rule jurisdictions the full right of self-government in both local and municipal matters, including the “assessment of property in such city or town for municipal taxation and the levy and collection of taxes thereon for municipal purposes….” This constitutional authority of home rule jurisdictions to levy and collect taxes is arguably an obstacle to statewide uniformity as contemplated by the Streamlined Sales and Use Tax Agreement. As of this writing, home rule jurisdictions have no coordinated requirement for out-of-state retailers to collect sales taxes.

    While the Supreme Court has arguably made things simpler by overruling the physical presence requirement laid out in the Quill case, states that have complicated sales tax systems, like Colorado, will still see uncertainty. The Supreme Court could find that a fractured collection requirement is discriminatory or an undue burden to interstate commerce.  Commerce clause enthusiasts will have to wait to see if the Colorado General Assembly will take on this issue in the next legislative session starting in January 2019.

  • Surprise! The 2019 Legislative Session Convening a Week Earlier

    by Patti Dahlberg

    In case you missed the discussions on House Joint Resolution 18-1021 in the final few days of the 2018 legislative session, the 2019 Legislative Session will begin on Friday, January 4. Of course, this also means that the 2019 Legislative Session will adjourn almost a week earlier than usual – by Friday, May 3.

    Traditionally, a legislative session in Colorado commences on the second Wednesday in January — but it can start sooner. The convening date and other important Colorado legislative timelines are specified in the state’s Constitution.  The provision determining when the legislative session annually convenes is in section 7 of article V of the state constitution. It requires the General Assembly to meet in regular session at 10 a.m. “no later than the second Wednesday of January each year.” In 2019, the General Assembly is convening on the first Friday in January. This is necessary because section 1 of article IV of the state constitution requires the newly elected Governor, Lieutenant Governor, Attorney General, Treasurer, and Secretary of State to take office on the second Tuesday of January, which falls on January 8 in 2019. And section 3 of article IV of the state constitution requires the General Assembly to declare the winners of the election for Governor, Lieutenant Governor, and the other three statewide elected officers, or to decide who the winners are if the general election ends in a tie or is contested. To declare the winners, the General Assembly must be in session. So each time all five statewide elected officials are elected, the General Assembly must convene before the second Tuesday of January.

    Because the convening date for the 2019 legislative session starts on a Friday instead of a Wednesday, House Joint Resolution 18-1021 also adjusted most of the legislative deadline days delineated in the House and Senate Joint Rules. The convening date and any necessary adjustment of deadline days for the 2020 legislative session will be decided by the 72nd General Assembly, most likely by a joint resolution adopted during the 2019 legislative session.

    An early convening date means earlier bill request deadlines. This year, each returning legislator must submit three of his or her five bill requests to the Office of Legislative Legal Services (OLLS) no later than Monday, November 26, 2018. Each legislator who is newly elected to the General Assembly must submit three of his or her five bill requests to the OLLS no later than December 10, 2018. Both of these dates are about a week earlier than usual.

    Although a January 4th starting date may cut the holiday season a little shorter this year for some of us, it could be worse. The convening date could have been January 1 — like it was a hundred years ago for the 1919 Legislative Session!

    Some additional constitutional provisions regarding legislative sessions:

    • Each regular legislative session can last no longer than 120 days, including Saturdays and Sundays and any other days the General Assembly may decide to take off (section 7 of article V).
    • A regular session can last less than 120 days, which has happened as recently as 2008.
    • Section 7 of article V allows the General Assembly to meet outside of a regular session when convened in a special session by the Governor or by written request of two-thirds of the members of each house. During a special session, the General Assembly may consider only the specific subjects listed in the Governor’s call or in the written request. For more information on special sessions, see “What’s so Special about a Special Session?”
    • During a legislative session, neither the House nor the Senate may adjourn for more than three days without the consent of the other house (section 15 of article V).
    • Before a bill can become law, recorded votes on the bill must be taken on two separate days in each house (section 22 of article V).
    • During session, the Governor has 10 days to act on bills that the General Assembly sends to him or her. However, during the last 10 days of session and once the General Assembly adjourns, the Governor has 30 days after adjournment to act on bills sent to him or her (section 11 of article IV).

  • Court Strikes Colorado’s Human Smuggling Law on Preemption Grounds

    by Richard Sweetman

    In the recent case of Fuentes-Espinoza v. People, 2017 CO 98, 408 P.3d 445, the Colorado Supreme Court overturned the convictions of a man who violated Colorado’s law against smuggling human beings (§ 18-13-128, C.R.S.) because it determined that federal law preempts the Colorado law. The case explains preemption jurisprudence and the circumstances under which a court may find that federal law preempts state law.

    Background
    In 2007, Bernadino Fuentes-Espinoza was arrested in Wheat Ridge, Colorado, after attempting to pass a counterfeit $100 bill to a gas station attendant. When police arrived, they discovered that Fuentes-Espinoza was driving a van full of people, two of whom fled and were not apprehended. It was later determined that Fuentes-Espinoza was transporting the passengers from Arizona to Kansas in exchange for $500. He was charged with, and later convicted of, seven counts of human smuggling in violation of § 18-13-128, C.R.S. (He was acquitted of one count of forgery for passing the counterfeit bill.)

    The General Assembly enacted § 18-13-128, C.R.S., in 2006. It provides that a person commits a class 3 felony “if, for the purpose of assisting another person to enter, remain in, or travel through the United States or the state of Colorado in violation of immigration laws, he or she provides or agrees to provide transportation to that person in exchange for money or any other thing of value.”

    Fuentes-Espinoza appealed his convictions, arguing that the federal “Immigration and Nationality Act”, 8 U.S.C. sec. 1101-1537 (2017) (INA) preempts § 18-13-128, C.R.S. The Colorado Court of Appeals rejected the preemption argument, concluding that Fuentes-Espinoza could not raise it on appeal because he had not raised it before the trial court. However, the Colorado Supreme Court chose to exercise its discretion to review the argument, and it agreed with Fuentes-Espinoza that the INA preempts § 18-13-128, C.R.S. Accordingly, the Court reversed the convictions on all counts.

    Analysis
    The Colorado Supreme Court began its analysis by noting that the U.S. Supreme Court recognizes three forms of federal preemption: Express, field, and conflict preemption.

    Express preemption occurs when Congress “withdraw[s] specified powers from the States by enacting a statute containing an express preemption provision” (quoting Arizona v. United States, 567 U.S. 387, 399 (2012).

    Field preemption occurs when “the States are precluded from regulating conduct in a field that Congress, acting within its proper authority, has determined must be regulated by its exclusive governance.” Id. Congress’s intent to preempt a particular field may be inferred “from a framework of regulation ‘so pervasive . . . that Congress left no room for the States to supplement it’ or where there is a ‘federal interest . . . so dominant that the federal system will be assumed to preclude enforcement of state laws on the same subject.’” Id. (quoting Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230 (1947)).

    Conflict preemption occurs when a state law conflicts with a federal law. Such a conflict exists (1) when compliance with both federal and state law is physically impossible and (2) in “those instances where the challenged state law ‘stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.’” Id. (quoting Hines v. Davidowitz, 312 U.S. 52, 67 (1941)).

    In Fuentes-Espinoza’s case, the Court found that Colorado’s human smuggling law is preempted under the doctrines of both field and conflict preemption.

    As to field preemption, the Court found that the comprehensive nature of the INA demonstrates Congress’s intent to “maintain a uniform, federally regulated framework for criminalizing and regulating the transportation, concealment, and inducement of unlawfully present aliens, and this framework is so pervasive that it has left no room for the states to supplement it.”

    As to conflict preemption, the Court found that Colorado’s human smuggling law “stands as an obstacle to the accomplishment and execution of Congress’s purposes and objectives in enacting the INA” because the law (1) conflicts with the “careful calibration” of the INA’s penalty scheme and (2) “sweeps more broadly” than the INA by criminalizing a wider range of conduct. “In doing so,” said the Court, “the Colorado statute disrupts Congress’s objective of creating a uniform scheme of punishment because some human smuggling activities . . . are punishable in Colorado but not elsewhere.”

    For more information, contact Richard Sweetman at (303) 866-4333.

  • ETHICS ALERT! Read This Before Your Next Town Hall or Community Meeting

    by Jennifer Gilroy

    Did you know that town hall and community meetings can be fraught with ethical dilemmas? If you’re a member of the General Assembly, you already know that one effective and efficient way to personally stay in touch with your constituents is to meet with them in a public and group setting. But you likely also know that it’s hard to find a low-cost or no-cost venue in your district that is large enough for that kind of gathering. So when a constituent or community business owner offers to provide a room—maybe even a room that otherwise rents out for a fee—it might be tempting to accept. If you’ve considered that option, did you also stop to consider whether it would be ethical under the constitutional gift ban known as “Amendment 41“? And what if that person or business owner also offers to provide your attendees with food or beverages? Is that permissible under Amendment 41? Maybe you think, well, I just won’t eat anything, and then it won’t be a problem.

    Recently, the Independent Ethics Commission  (Commission) weighed in on what is—and more importantly, what is not—permissible under the gift ban when it comes to these types of meetings, issuing both an advisory opinion and a ruling on an ethics complaint against a legislator. These opinions appear to conflict with each other. The ruling on the ethics complaint is being appealed, and hopefully the reviewing court will provide further guidance. In the interim, this article attempts to navigate the distinctions between the two opinions to provide a few critical takeaways to know before hosting, or accepting an invitation to participate in, a public meeting with constituents.

    Town Hall Meetings vs Community Meetings. First, before accepting an invitation to a public meeting or hosting a meeting, think about what type of event it is and who is actually hosting it. In early 2017, a member of the General Assembly formally asked the Commission two questions: 1) Whether he could attend a community meeting organized as a public forum on a topic of interest to his constituents (public rail transportation), at which he was to serve as both the moderator and a panel participant along with other representatives from local government and the RTD; and 2) whether, in other situations, he could accept the provision of a room from a constituent to host his regular legislative town hall meetings. In reaching its conclusions on the questions, the Commission distinguished between the two types of meetings.

    In the first instance, one of the legislator’s constituents had offered to provide a room at a local brew pub—one that normally rented for more than $59 per hour—for a community meeting on public rail transportation. The constituent also planned to provide appetizers for attendees. While the legislator was the moderator, not a host, of the community meeting and was to participate in the question-and-answer session, the Commission highlighted the fact that there were other government officials as panelists and noted that the meeting would have proceeded whether the legislator could attend or not. In other words, the Commission distinguished this type of public forum event from a legislator’s personal town hall meeting at which the legislator serves as host, in his legislative capacity, to discuss legislative matters of interest with constituents—sort of as the star of the show in that case. The Commission determined that, in the community meeting situation, the meeting space was a “gift to the public,” not to the legislator (or any other civic leader in attendance, for that matter). The Commission gave a green light to the legislator’s “admission” to the meeting, and even his enjoyment of the appetizers, based on an exception to the constitutional gift ban that permits admission to and the cost of food and beverages consumed at a meeting at which the individual is to speak as part of a scheduled program.

    On the other hand, the Commission viewed the town hall meeting format differently. In response to the legislator’s second question, the Commission said that the provision of a venue to the legislator for one of his town hall meetings is a gift to him and, if the value of the gift (i.e., the cost of the room) is more than the allowed exempted amount (currently $59), then the legislator could not accept it unless it met one of the eight exceptions to the gift ban. Examples of exceptions include situations where the room was provided in the form of a campaign contribution or by the state or a local government or by a nonprofit organization that receives less than 5% of its funding from for-profit entities. In addition, the Commission cautioned the legislator to avoid even the “appearance of impropriety,” which the Commission observed can weaken public confidence in government and create a perception of dishonesty, even where government officials are technically in compliance with the law.

    Who is “hosting” the meeting? Compare the Commission’s responses to those two questions with its more recent finding in an ethics complaint against a different member of the legislature. The Commission found that the legislator had violated the constitutional gift ban when she moderated and participated in a question-and-answer session at a community meeting at which a panel of local government officials discussed a topic of interest to the legislator’s constituents, in this case oil and gas development. Sound familiar? The Commission focused on the fact that, unlike the community meeting that was the subject of the earlier advisory opinion, the invitation to this meeting did not disclose who was sponsoring the event, in other words, who would be paying for the room, appetizers, and drinks that were available at the meeting. The dissenting opinion observed, correctly, that Amendment 41 is silent about disclosure, and, “the disclosure or failure to disclose the identity of the person paying for the event does not convert the event into a gift.”  Nevertheless, the Commission relied heavily on the fact of nondisclosure.

    The Commission also emphasized that, unlike the community meeting that was the subject of the earlier advisory opinion, the invitation to this meeting described the legislator as the “host” of the event, which the Commission took to mean that she was a necessary party to the event. The Commission also found that the legislator’s aide worked closely with the sponsor company’s representative to plan and market the event, invite speakers, and create a list of invitees, using the legislator’s e-mail address for communications and signing emails she authored as the legislator’s aide. As a result, the Commission attributed constructive, if not actual, knowledge of the planning and execution, and therefore the hosting, of the meeting to the legislator even though her actual involvement was minimal.

    While in the earlier opinion the Commission stated that the venue was a “gift to the public” and the legislator could enjoy the food provided at the meeting, in this case the Commission stated that the legislator benefited from the event not only by receiving food and drinks, free of charge, to provide to her constituents, but also by receiving a forum, free of charge, at which she was able to address her constituents regarding oil and gas drilling in their community. The Commission emphasized that the nondisclosure of the entity paying for the costs of the event reinforced their belief that the legislator was the recipient of a gift: She received a forum to address the public without deterring the public’s attendance by disclosing the presence and sponsorship of the event. “[She] was able to hold an event for her constituents and get her message out to her constituents, all without paying for the costs of the event she hosted.” However, as the dissenting opinion observed, “It is hard to imagine a better or more appropriate form of political participation….Amendment XXIX was not intended to prohibit elected officials from having a point of view or communicating it.”

    The Commission’s opinion essentially states that Amendment 41 prohibits outsourcing the costs of legislator-sponsored events to private donors; the dissent responds that, at most, this was an industry-sponsored event that leveraged the legislator’s name and position to attract people to an event where she could attempt to persuade them to their point of view.

    Takeaways. As noted, the legislator has appealed the Commission’s ruling on the ethics complaint against her, but until there is a ruling from the court, the following are a few lessons for legislators to take away from these two opinions as they stand today:

    1. If you plan to hold a town hall meeting in your legislative capacity to discuss matters of interest to your constituents and other legislative matters—a meeting that only you could hold and one that would not proceed without your presence—then you will be viewed as the “host” of the meeting and should not accept a “gift” of a meeting space or food or beverages for your attendees unless the value of that “gift” is less than $59 or unless the gift meets one of the eight specific exceptions to the constitutional gift ban. Otherwise, the total value of the [donated] meeting space, food, and beverages enjoyed by your constituents will likely be viewed as prohibited gifts to you.
    2. If, on the other hand, you are invited to be a speaker, moderator, or other participant at a public forum or community meeting being sponsored and paid for by a third party, be sure the invitation and promotional material clearly identify who is sponsoring (paying for) the event.
    3. In those situations where you are speaking at or otherwise participating in a public forum or community meeting, a third party is sponsoring the event, and that fact is clearly disclosed, you may accept admission to, and the food and beverages provided at, that event under an exception to the constitutional gift ban.
    4. Do not allow the use of your name as the “host” of an event merely as a means to attract attendance at the event, unless you are the actual sponsor of the event and paying the costs of the event. It will likely be viewed as your event and the costs for it, even if borne by a private party for others’ enjoyment, will likely be viewed as a prohibited gift to you.
    5. Be aware of possible conflicts of interests—or even the appearance of impropriety. Do not accept any gifts of a room, food, or beverages for one of your meetings from a lobbyist or from an individual or entity that has an interest in pending legislation.
    6. Supervise the activities of your aides closely. You may be found to have constructive, if not actual, knowledge of what they are planning and doing on your behalf and they may not have read the tips here.

    Public meetings of the types described here are a valuable way to practice the democratic process. With a clearer sense of how to approach these events, you are better equipped to avoid any ethical pitfalls while still participating in effective dialogues with your constituency.

  • U.S. Supreme Court Closes the Door on Union Agency Fees

    by Yelana Love

    On June 27, 2018, the United States Supreme Court decided Janus v. American Federation of State, County, and Municipal Employees,[1]  The Court, explicitly overruling Abood v. Detroit Bd. of Ed.,[2]  held that an Illinois state law requiring all employees in a bargaining unit exclusively represented by a public-sector labor union, including employees who had chosen not to join the union and who opposed the union’s collective bargaining and other positions, to pay an agency fee to the union, violated the First Amendment to the United States Constitution. The Court reasoned that the problem with the law was that it forced employees who had chosen not to join the union “to subsidize [the union’s] private speech on matters of substantial public concern.”[3]

    Factual and Legal Background of the Case
    The Illinois Public Labor Relations Act (IPLRA) allows employees of the State of Illinois and its political subdivisions to unionize. Under the IPLRA, if the majority of employees in a bargaining unit vote to be represented by a labor union, the union is designated as the exclusive representative of all the employees within the bargaining unit, including employees who choose not to join the union. Employees who join the union must pay full union dues. The specific provision of the IPLRA at issue requires employees who do not join the union to pay a percentage of the union dues referred to as an “agency fee.” In Abood, the United States Supreme Court had rejected a First Amendment challenge to an agency fee, concluding that nonunion employees may be charged an agency fee for the portion of union dues used to pay for activities that are “germane to [the union’s] duties as collective bargaining representative,” but not for any portion of dues used to fund the union’s political and ideological projects.[4]

    Mark Janus was an Illinois state employee working in a bargaining unit that voted to be represented by a union.[5]  Janus elected not to join the union because he opposed many of its policy positions, but he was required to pay an agency fee, which was automatically deducted from his pay.

    Janus filed a complaint in federal court asserting that “nonmember fee deductions are coerced political speech” and “the First Amendment forbids coercing any money from the nonmembers.”[6]  Relying on Abood, the union moved to have the case dismissed. The District Court granted the motion to dismiss and the Court of Appeals for the Seventh Circuit affirmed the decision. The United States Supreme Court granted certiorari to consider whether the required payment of an agency fee for nonunion, public-sector employees is unconstitutional.

    Analysis of the Decision
    The Court begins its opinion by discussing Abood, noting that in that case “the Court upheld the constitutionality of an agency-shop arrangement like the one now before us,” but that “in more recent cases we have recognized that this holding is ‘something of an anomaly,’ and that Abood’s ‘analysis is questionable on several grounds.’”[7]  The Court then considers “whether Abood’s holding is consistent with standard First Amendment principles,”[8]  pointing out that the First Amendment forbids abridging the freedom of speech, which “includes both the right to speak freely and the right to refrain from speaking at all.”[9]  The Court recognizes that a “‘significant impingement on First Amendment rights’ occurs when public employees are required to provide financial support for a union that ‘takes many positions during collective bargaining that have powerful political and civic consequences’”[10]  and concludes that “[b]ecause the compelled subsidization of private speech seriously impinges on First Amendment rights, it cannot be casually allowed.”[11]

    Next, the Court determines the appropriate level of scrutiny to be applied when determining the constitutionality of agency fees. Rejecting both the dissent’s view that the Court should “apply what amounts to rational-basis review, that is, that we ask only whether a government employer could reasonably believe that the exaction of agency fees serves its interests,”[12] and Janus’ request to subject the law at issue to strict scrutiny, the Court instead follows the precedent it set in Knox[13] and applies exacting scrutiny. Exacting scrutiny is a standard under which the compelled subsidy of an agency fee must “serve a compelling state interest that cannot be achieved through means significantly less restrictive of associational freedoms.”[14]

    In Abood, the Court allowed agency fee agreements because they promoted the state’s interest in labor peace and the avoidance of free-riders. But the Janus Court rejects both of these rationales. Instead, it concludes that “[w]hatever may have been the case 41 years ago when Abood was handed down, it is now undeniable that ‘labor peace’ can readily be achieved ‘through means significantly less restrictive of associational freedoms’ than the assessment of agency fees.”[15]  The Court is equally unpersuaded by the free-rider argument, relying on Knox for the principle that “free-rider arguments…are generally insufficient to overcome First Amendment objections.”[16]  Accordingly, the Court concludes that because the state interests relied on in Abood fail to pass exacting scrutiny analysis, the Abood court erred in upholding public sector agency fee agreements as constitutional. The Court overrules Abood, holding that the agency fee provision of the IPLRA challenged by Janus violates the First Amendment.

    Impact of the Decision on Colorado
    The Janus decision appears to have little immediate, direct impact on Colorado. Colorado does not currently have statutes related to public sector unions and therefore does not have any statutes requiring nonunion, public sector employees to pay agency fees. However, Janus would presumably discourage a future Colorado General Assembly from enacting a law requiring the payment of agency fees by nonunion public sector employees, because such a law would clearly violate the First Amendment as interpreted by the Janus Court.

     

    [1] Janus v. AFSCME, Council 31, 585 U.S. ___, 138 S. Ct. 2448, 201 L. Ed. 2d 924 (2018).

    [2] 431 U.S. 209 (1977).

    [3] Janus, 138 S. Ct. at 2460, 201 L. Ed. 2d at 934.

    [4] Abood, 431 U.S. at 235-36.

    [5] The specific union was the American Federation of State, County, and Municipal Employees, Council 31.

    [6] Janus, 138 S. Ct. at 2462, 201 L. Ed. 2d at 937.

    [7] Janus, 138 S. Ct. 2463, 201 L. Ed. 2d at 938.

    [8] Id.

    [9] Id. (quoting Wooley v. Maynard. 430 U.S. 705, 741 (1977)).

    [10] Janus, 138 S. Ct. at 2464, 201 L. Ed. 2d at 939 (quoting Knox v. Service Employees, 567 U.S. 298, 310-311)(additional internal citation omitted).

    [11] Id.

    [12] Janus, 138 S. Ct. at 2465, 201 L. Ed. 2d at 940.

    [13] Supra note 10.

    [14] Knox, 567 U.S. at 310.

    [15] Janus. 138 S. Ct. at 2466, 201 L. Ed. 2d at 941 (Quoting Harris v. Quinn, 573 U.S. ___ (2014)).

    [16] Knox, 567 U.S. at 310.

  • Electronic Participation in Committee Meetings

    by Jason Gelender

    Filmmaker Woody Allen and countless others have said that 80 percent of success in life is showing up. If that’s true, then the legislator who wants to be successful should probably show up for his or her interim committee meetings. But sometimes schedule conflicts, long travel times, or unexpected life events can make showing up for an interim committee in person difficult or impossible. Fortunately, for interim committee members only, and subject to certain conditions and limitations, there is an alternative to showing up in-person for interim committee meetings: Electronic, also sometimes referred to as remote, participation.

    During the 2017 legislative session, the General Assembly enacted House Bill 17-1113. The act authorizes the Executive Committee of the Legislative Council (Executive Committee) to allow legislators to participate electronically in “committee meetings occurring during the legislative interim” only and to recommend and develop policies for electronic participation. The act also specifies that a legislator who participates electronically in an interim committee meeting is “deemed to be in attendance” at the meeting and is entitled to compensation of $99 per day for that attendance as specified in section 2-2-307 (3)(a), C.R.S., but not to reimbursement for any expenses incurred in connection with the electronic participation. [Note: The lack of reimbursement is an explicit exception to section 2-2-307 (3)(b), C.R.S., which implicitly assumes in-person attendance at interim committee meetings and specifies that an attending legislator is “entitled to reimbursement for all actual and necessary travel and subsistence expenses.”] During the 2018 legislative session, the General Assembly made a conforming amendment to Joint Rule 24A of the Joint Rules of the Senate and the House of Representatives, which had prohibited electronic participation, to allow legislators to electronically participate in interim committee meetings “to the extent authorized by the Executive Committee, and subject to any policies that the Executive Committee develops” as authorized by law.

    The Executive Committee established electronic participation policies and notified the members of the Seventy-First General Assembly of these policies by letter. The policies are summarized as follows:

    • Committee members may electronically participate in meetings of interim committees and committees of reference conducting SMART Act hearings held at the State Capitol complex (the Capitol and the Legislative Services Building) only. Electronic participation is not allowed for meetings of year-round standing committees that may meet in the interim such as the Joint Budget Committee, Legislative Audit Committee, and Capital Development Committee [Note: The full list of year-round committees can be viewed on the Colorado General Assembly’s website at the following link under the heading “Year-Round Committees”: https://leg.colorado.gov/content/committees.]
    • Up to two members of an interim committee may participate electronically at a meeting so long as:
      • A quorum of the members of the committee are expected to be physically present at the meeting;
      • The chair authorizes the electronic participation no later than 48 hours before the meeting [Note: In an emergency, the chair and the Director of Research of the Legislative Council may approve electronic participation after the 48-hour deadline] and notifies Legislative Council Staff of the authorization at remote.part@coleg.gov;
      • The member participating electronically calls in to the meeting 30 minutes before it begins to test connections and technology; and
      • Neither of the members is chairing the meeting.
    • Members participating electronically may not vote. These members count toward the quorum needed to hold the committee meeting, but a quorum of the members of the committee must be physically present at the meeting for the committee to vote on any matter.
    • Members participating electronically must follow the same rules and meeting decorum as members participating in person.
    • There is no guarantee of electronic participation. Accordingly:
      • The member chairing a meeting may discontinue remote participation if technological or other issues interfere with the meeting;
      • No additional equipment or software will be provided to members who wish to participate electronically; and
      • Members participating electronically must maintain any applicable security requirements and protect any log-in credentials.

    For more information on how to electronically participate in an interim committee meeting or SMART Act hearing, please contact Colorado Legislative Council Staff at 303-866-3521.

  • Statutory Revision Committee: Three Years In

    By Jessica Wigent

    In the three years since its (re)creation in 2016, the Statutory Revision Committee (codified in part 9 of article 3 of title 2, C.R.S.) has, in accordance with its charge, introduced and passed more than 50 bills to modify or eliminate antiquated, redundant, or contradictory rules of law to harmonize the statutes with modern conditions. In 2018, these modifications included modernizing Dickensian references to “paupers” (HB 18-1142).

    Since we last checked in with LegiSource, the SRC met five times: Three times in the 2017 interim (with a particularly memorable interruption during the August meeting—the total solar eclipse) and twice in the 2018 legislative session. During these lively hearings, committee members heard the presentation of memos and testimony on subjects as far-ranging as obsolete provisions relating to oaths and bonds of public officials to the need to address outdated terminology in statute related to the “legitimacy” of children.

    Overall, hundreds of pages of statutory text have been repealed or brought into the 21st century through SRC-recommended legislation.

    Membership
    The SRC consists of eight legislators (two appointees by the majority and minority leadership in each house) and two nonlegislator, nonvoting attorneys appointed by the Committee on Legal Services. The current appointees are:

    • Senator Dominick Moreno, Chair
    • Senator Beth Martinez Humenik, Vice-chair
    • Representative Jeni Arndt
    • Representative Edie Hooton
    • Representative Hugh McKean
    • Senator Jack Tate
    • Representative Dan Thurlow
    • Senator Rachel Zenzinger
    • Patrice Collins
    • Brad Ramming

    Under the SRC’s statute, House and Senate leadership and the Committee on Legal Services will appoint new SRC members in January of 2019. Current SRC members may be reappointed to another term.

    Attending to the Antiquated, Obsolete, and Anachronistic

    In 2018, the SRC introduced, the General Assembly passed, and the Governor signed more than 20 bills, including legislation:

      • Eliminating references to the Proposition AA Refund Account—repealed in 2017—which were still littered about the statutes (HB 18-1369);
      • Adding, at the request of attorneys from the judicial branch, a cross-reference in the crime of failure to register as a sex offender (§18-3-412.5, C.R.S.) to the requirement that the offender must file a cancellation form when he or she moves out of state (§16-22-108, C.R.S.) (HB 18-1356);
      • Modernizing outdated references to “mental retardation” in statute, after being made aware of the issue by an advocate in the disability community (SB 18-096);
      • Removing descriptions of children as “legitimate” or “illegitimate” in statute, a practice abandoned decades ago, as the state considers all children legitimate, regardless of the marital status of a child’s parents (SB 18-095); and
      • Cleaning up inaccurate references to “early childhood care and education councils”. They’re just “early childhood councils,” as former Senator Evie Hudak testified after bringing attention to the inaccuracy through her participation on an interim education committee (HB 18-1141).

    How an SRC Idea Becomes a Bill

    Executive department agencies, the judicial branch, interested Colorado residents, and nonpartisan staff from a number of agencies in and around the Capitol, as well as legislators themselves, have brought issues for the SRC to consider. Initially, staff considers these requests and whether they fall within the charge of the SRC and then prepares a memo detailing the requested change, often with a bill draft attached for the SRC to consider.

    In addition, the statutory charge of the SRC includes examining “current judicial decisions.” To that end, the SRC has asked staff to review current statutes that are found by an appellate court to be unconstitutional. Staff annually prepares memos for the SRC to bring attention to these provisions.

    An affirmative vote from at least five of the legislative SRC members is needed to introduce proposed legislation, and the SRC regularly considers more draft bills than it approves. In 2018, the SRC rejected multiple proposals it determined were outside its charge. All proposed drafts are publicly available on the SRC’s website and in the annual report submitted to the General Assembly each November 15th. You may also email staff for more information.

    The SRC meets next in October, though they are still finalizing the date and the issues to be considered. Join the SRC mailing list and be notified when the details are available.

    Know of any antiquated, redundant, or contradictory laws? Please contact the SRC staff via email:  statutoryrevision.ga@coleg.gov
    All meetings are public, and anyone and everyone is encouraged to attend or to propose issues to the SRC staff.

  • ULC Approves Seven New Acts for State Consideration

    by Thomas Morris and Patti Dahlberg

    The Uniform Law Commission (ULC) is a national body consisting of commissioners appointed by all 50 states, the District of Columbia, the U.S. Virgin Islands, and Puerto Rico. The ULC promotes uniformity for state laws when uniformity is desirable and practicable by developing proposed uniform legislation for state legislature consideration.

    In Colorado, legislative leadership appoints commissioners pursuant to section 2-3-601, C.R.S. Under Joint Rule 24 (b)(1)(D), the Colorado Commission on Uniform State Laws (CCUSL) may recommend bills for introduction during a legislative session of the General Assembly. The CCUSL meets during the annual summer ULC conference each year to adopt a preliminary legislative agenda for the upcoming regular session. It then typically meets at least once before the regular session to finalize the agenda.

    The CCUSL will meet at 2:30 p.m. on Monday, August 13, 2018, in Room 0112 for a preliminary discussion of this year’s legislative agenda. The meeting is open to the public and will be broadcast live over the internet.

    The CCUSL has included the first six of the seven new acts listed below in its proposed legislative agenda for the 2019 legislative session. The proposed agenda also includes four acts previously approved by ULC:  the Regulation of Virtual Currency Businesses Act, the Revised Athlete Agents Act (2015), the Revised Unclaimed Property Act, and the Voidable Transactions Act Amendments (2014).

    The seven new uniform acts approved by the ULC in July at its annual conference in Louisville, Kentucky were:

    • Uniform Civil Remedies for Unauthorized Disclosure of Intimate Images Act. The act creates a cause of action for unauthorized disclosure of private, intimate images and outlines procedures enabling victims to protect their identity in court proceedings. In addition, the act provides various remedies for victims, including actual damages, statutory damages, punitive damages, and attorney’s fees.
    • Uniform Criminal Records Accuracy Act. Intended to improve the accuracy of the criminal history records used for law enforcement purposes and frequently used in determining a person’s eligibility for employment, housing, credit, and licensing, the act requires the governmental law enforcement agencies and courts that collect and use criminal history records to ensure the accuracy of collected information. It allows individuals to see and correct errors and includes a mistaken identity prevention registry.
    • Uniform Fiduciary Income and Principal Act. An updated version of the Uniform Principal and Income Act (adopted in 47 jurisdictions, including Colorado), this act provides modern accounting standards for fiduciaries to allocate receipts and disbursements between principal and income and to adjust those allocations as appropriate. It includes flexible rules on unitrust conversion, which were not part of the most recent version of the act but have since become popular in states.
    • Uniform Nonparent Custody and Visitation Act. The act addresses the rights to custody of or visitation with a child for parties other than parents. The act recognizes a right to seek custody or visitation for two categories of individuals: (1) nonparents who have served as consistent caretakers of a child without expectation of compensation; and (2) other nonparents who have a substantial relationship with a child and who demonstrate that denial of custody or visitation would result in harm to the child.
    • 2018 Amendment to Revised Uniform Law on Notarial Acts (RULONA). The 2018 Amendment to RULONA authorizes notaries public to perform notarial acts for remotely located individuals using audio-visual communication technology regardless of where the individual may be located. The amendment is not limited to foreign located individuals; it extends the authority to any remotely located individuals. It was prepared in response to a rapidly emerging trend among the states to authorize the performance of notarial acts by means of audio-visual technology. Colorado adopted RULONA in 2017.
    • Uniform Supplemental Commercial Law for the Uniform Regulation of Virtual Currency Businesses Act. The act addresses the commercial law rights of virtual-currency businesses that have control over their customers and their customers’ virtual currency by providing to those businesses and customers duties and rights comparable to those enjoyed by customers of securities intermediaries under Article 8, Part 5 of the Uniform Commercial Code. This act is a companion to the 2017 Uniform Regulation of Virtual-Currency Businesses Act.
    • Amendments to UCC Articles 1, 3, 8 and 9. The act is drafted to provide the substantive commercial law rules to support a national electronic registry for residential mortgage notes with minimal displacement of state laws. Until the federal National Mortgage Note Repository Act referred to in the Amendments is enacted, the Amendments are not part of the official text of the UCC, and states should not undertake to introduce or enact these amendments.

     

    See also:

    You can subscribe to the CCUSL mailing list to receive e-mail notifications about CCUSL meetings and upcoming meeting agendas.

  • Colorado’s Capitol Building Started 150 Years Ago with a Land Donation – Thank You Mr. Brown

    by Patti Dahlberg

    February 28, 1861 – The Colorado Territory is carved out from portions of what was previously the Kansas, Nebraska, New Mexico, and Utah Territories. That autumn, the First Territorial Assembly selected Colorado City, a spot on the open prairie near Pikes Peak and close to the center of the new territory, as the territorial capitol. In 1862, the first and last territorial meeting was held in Colorado City. The lack of accommodations and provisions for the twenty-two members of the Assembly caused them to adjourn and reconvene in Denver City. There, the Assembly promptly named Golden City as the territorial capital. Since the Assembly also, at times, met in Denver instead of Golden, Colorado’s seat of government actually alternated between Denver and Golden between 1863 and 1867.

    Moving territorial meetings and carting wagon loads of official property (tables, benches, and gunny sacks of archives) from location to location eventually grew tiresome, so in December 1867 the Seventh Territorial Assembly passed an act making Denver the capital city. Territorial Governor Alexander Hunt sent out a call for a land donation and received several offers. In January 1868, Hunt’s Capitol Commission accepted Henry C. Brown’s ten-acre-land donation, located less than a mile from the center of the frontier town. The out-of-pocket value of this donation was about $12.50, but for Mr. Brown it was a shrewd investment in the future value of the rest of his 160 acres surrounding the proposed capitol building and grounds. Could this be Colorado’s first public-private partnership endeavor?

    It would be 18 years before construction on a capitol building would start and then another 20 years before it was considered finished. Mr. Brown, however, immediately began developing the area around the future capitol’s location, known as “Brown’s Bluff,” with brownstone mansions. Many initially dismissed Brown’s Bluff as being too far from the center of town, but soon Denver’s wealthier families began to leave the commercial building construction and congestion of the growing “inner city” to move to the quieter and more picturesque “Capitol Hill” area near the site of the future capitol building. Meanwhile, the Territorial Assembly continued to meet in rented rooms and warehouses along Larimer Street and the territorial governor held office in the Larimer Street Barclay Building/Hotel.

    In 1875, there still was no sign of any construction on Mr. Brown’s donated land, and now that Colorado was actively campaigning for statehood, a reason to wait. A state capitol city would need to be chosen after statehood was attained, and there was no guarantee that Denver would become that state capital, so the land remained an open field. In 1876, Colorado, known as the “Centennial State,” became the 38th state to join the union, but the public vote on the state capital city would not be held for another five years. In 1879, having given up hope on the construction of a Denver capitol building and needing the $50,000 his donation was now worth, Mr. Brown launched a legal battle to reclaim his land.

    On November 8, 1881, after counting the 45,497 votes cast, Denver was elected Colorado’s capital city. Two years later, the legislature passed an act to build the Colorado State Capitol and appointed a “Board of Capitol Managers” to oversee the task, even though the legal battle for the land remained unsettled. The legal battle dragged on for seven years, making its way to the Colorado Supreme Court in 1881 and the United States Supreme Court twice. Each time the high courts ruled for Colorado; the last U.S. Supreme Court ruling in 1886 was final.

    Construction commenced the summer of 1886 with the state of Colorado barely ten years old and the log cabins and wood plank sidewalks from the gold rush days still lining the banks of Cherry Creek. The construction on a capitol building “large enough to house the state government far into the future” ended in 1908 when gold plating replaced the original copper plating on the dome. Colorado state government continued to grow with new agencies and additional employees and soon needed more office space than the capitol building could accommodate. By 1915 construction on additional state office buildings along Colfax and Fourteenth Street started.

    Colorado is grateful to Mr. Brown for his generous donation that laid the foundation for its beautiful Capitol and grounds. Mr. Brown’s Attic is a public museum/gallery located between the Capitol’s third floor and dome dedicated to the history of the building he made possible and an ongoing tribute to the man who made it possible. Its photographs, displays, and artifacts tell the Capitol’s story from its beginning as a field of grass to the present day.

    More about the man behind the gift

    Henry Cordes Brown, born in Ohio in 1820, was the 19th of 20 children. He was orphaned when he was seven years old and worked at a nearby farm until he was 16. He then learned the carpentry trade and later worked as a carpenter with an older brother in St. Louis, Mo., for several years before heading west to California where he continued to work as an architect, builder and carpenter.

    No stranger to hardship, Mr. Brown was a self-made man several times over. While in California, the banking crash and economic panic of 1854 cost Mr. Brown his life savings of $50,000. He simply went back to work and soon saved $6,000, and in 1857, sailed for Callao, Peru, for a shipping business venture only to return to St. Louis in 1858 with sixty cents in his pocket. Resuming his carpentry trade, he earned money for another journey west to California, this time with his new wife and young son. In 1860, they arrived in Denver and decided to remain there. He was able to obtain wealth and status through building contracts and other land and mine operations. In 1863, he claimed 160 acres, known as “Brown’s Addition” just outside of the frontier town of Denver.

    Most famous for building The Brown Palace Hotel, Mr. Brown also owned the Denver Daily Tribune for three years and was a charter member of the Denver Board of Trade, the first business organization in the city, which later became the Denver Metro Chamber of Commerce. He helped bring the Denver Pacific Railroad to Denver, co-established the Bank of Denver, and was involved in establishing the Denver City Library.

    Mr. Brown made a fortune from real estate development and his other land holdings until the global economic panic of the 1870s nearly destroyed him financially. He was forced to sell his home and estate for $50,000, but he somehow recovered and by 1880 was worth nearly five million dollars, making him one of the wealthiest men in Colorado. Twenty years later and only one year after opening the doors of The Brown Palace Hotel, the Silver Panic of 1893 hit Colorado, robbing Mr. Brown of his fortune one last time. Unable to pay his debts, he sold The Brown Palace Hotel and retired to California.

    Mr. Brown died in March 1906 at a hotel in San Diego, Calif. His body was returned to Denver to lay in state in the Rotunda of the State Capitol, allowing Coloradans to honor and pay tribute to the man who helped make it possible. He is buried in Denver’s Fairmount Cemetery.

     

    Sources:

    The Pride of Our People: The Colorado State Capitol, first published 1992 by the Colorado General Assembly

    The Colorado State Capitol: History, Politics, Preservation by Derek R. Everett

    http://www.genealogy.com/forum/regional/states/topics/oh/belmont/2004/

    http://wallstreetoftherockies.com/those-illustrious-browns/

    https://history.denverlibrary.org/capitol-hill-neighborhood-history

  • Does the “Masterpiece Cakeshop” decision affect free speech, freedom of religious expression, and civil rights protections for protected classes?

    by Jane Ritter

    Not much, it turns out.

    Despite nearly six years of legal speculation and arguments, as well as approximately 100 amicus briefs filed in support of both sides of the case, the narrow holding of the U.S. Supreme Court’s 7-2 majority opinion is primarily a critique of the actions of the Colorado Civil Rights Commission (CCRC) rather than a strong message supporting or restricting free speech, religious expression, gay marriage, or the wedding industry.

    Background
    The case began with a visit in July of 2012 to the Masterpiece Cakeshop (Cakeshop) in Lakewood, Colorado, by Charlie Craig and David Mullins. Craig and Mullins are a same-sex couple from Colorado who planned to marry in Massachusetts because same-sex marriage at that time was not yet recognized in Colorado. They planned to return to Colorado after the wedding to celebrate with family and friends. The purpose of their visit to the Cakeshop was to order a wedding cake for their Colorado celebration.

    The couple left the Cakeshop after meeting with the owner, Jack Phillips, who, without discussing specifics of any potential cake design, declined to make a wedding cake for them. Phillips informed the couple that he did not and would not create wedding cakes for same-sex marriages because of his deep and sincerely held Christian beliefs. However, Phillips told them they were free to purchase brownies, cookies, or regular cakes from the bakery.

    The Long Legal Road
    After their Cakeshop visit, Craig and Mullins filed a complaint with the CCRC under the state’s anti-discrimination laws related to places of public accommodation (section 24-34-601, C.R.S.), which prohibits businesses open to the public from discriminating against customers on the basis of disability, race, creed, color, sex, sexual orientation, marital status, national origin, or ancestry. The complaint resulted in a lawsuit, Craig v. Masterpiece Cakeshop, which the CCRC decided in favor of the plaintiffs. Phillips appealed the decision to the Colorado Court of Appeals, which affirmed the CCRC’s decision and order.

    In each proceeding, the legal argument presented by Craig and Mullins was that Cakeshop, a place of public accommodation, had discriminated against them based on their sexual orientation. Phillips, on the other hand, argued that requiring him to create cakes for same-sex weddings would violate his right to free speech by compelling him to express a message with which he disagreed and would also violate his right to the free exercise of religion.

    The Colorado Supreme Court declined to hear an appeal, but the U.S. Supreme Court granted cert and agreed to hear the case in its 2017 term. After multiple filings from both parties, along with the aforementioned amicus briefs (from parties ranging from the Trump Administration to the Southern Poverty Law Center), the Court heard oral arguments on December 5, 2017. The 7-2 opinion, authored by Justice Anthony Kennedy, was released on June 4, 2018.

    The Bottom Line
    In his majority opinion (Masterpiece Cakeshop v. Colorado Civil Rights Commission, 584 U.S. ___ (2018)), Justice Kennedy acknowledged that the Court appeared to face “the delicate question of when the free exercise of [Phillips’] religion must yield to an otherwise valid exercise of state power.” However, the CCRC’s utter lack of neutrality in its deliberations made it unnecessary for the Court to determine the extent to which the CCRC’s final decision may have encroached upon Phillips’ rights.

    Justice Kennedy quoted remarks made by two members of the CCRC at two of the public hearings that were held to consider Phillips’ case. Each of the quotes, according to Kennedy, exhibited “a clear and impermissible hostility” toward Phillips’ sincerely held religious beliefs. Moreover, wrote Justice Kennedy:

    The record shows no objection to these comments from other commissioners. And the later state-court ruling reviewing the Commission’s decision did not mention  those comments, much less express concern with their content. Nor were the comments by the commissioners disavowed in the briefs filed in this Court. For these reasons, the Court cannot avoid the conclusion that these statements cast doubt on the fairness and impartiality of the Commission’s adjudication of Phillips’ case.

    Justice Kennedy then noted that on at least three prior occasions, the Colorado Civil Rights Division had considered the cases of bakers who refused to create cakes with images that conveyed disapproval of same-sex marriage, along with religious text. Each time, the Division had found that the baker acted lawfully in refusing to provide such a cake.

    In light of these facts, Justice Kennedy concluded that the CCRC’s hostility to religion was “inconsistent with the First Amendment’s guarantee that our laws be applied in a manner that is neutral toward religion.” Because the CCRC failed to weigh the State’s interest against Phillips’ sincere religious objections in a neutral manner, as required by the Free Exercise Clause, the CCRC’s order concerning Phillips “must be set aside.”

    So Phillips does not have to make a wedding cake for Craig and Mullins, but only because Phillips’ beliefs were not respected by the Colorado Civil Rights Commission. If another same sex couple walks into Phillips’ shop—or any other bakery—and orders a wedding cake, we don’t really know whether the baker is required under law to sell them the wedding cake. All we know is that the public body that decides the case must respect the sincerely held religious beliefs of the parties.