Colorado LegiSource

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

Category: State Government

  • If you build it, it will get used (and used and used)

    by Patti Dahlberg and Jessica Chapman

    CDOT – So What Do They Do?

    The Colorado Department of Transportation (CDOT) has been around in some form or another since 1910—its inception was roughly parallel to the increasing availability of automobiles in the state. In a previous LegiSource article, we explored the history and transformation of the department over the years and its role in building Colorado’s roadway system. But what is the department doing for Colorado transportation now? Maybe a better question is what isn’t the Colorado Department of Transportation doing?

    Overview

    The department’s prime directive is to ensure that Colorado has a safe and efficient transportation system by building and maintaining state and federal highways (not local and residential roads, which are the responsibility of cities and counties). Of the department’s budget (which totals over $1.7 billion for FY 2024-25), 58% is used just to maintain the current system of roads in the state.

    In order to ensure safe, efficient roads, the department provides three main services:

    • snow and ice operations;
    • roadway maintenance and preservation; and
    • construction management.

    To enhance public safety, CDOT provides:

    • traffic monitoring;
    • avalanche control;
    • rockfall mitigation;
    • mudslide clean-up and mitigation;
    • transit development and grants; and
    • traffic safety education.

    Some Specifics

    Emergency Response. One example of CDOT’s valuable service to the state involves its response to the mudslides, caused by heavy rain in July 2021, that closed I-70 through Glenwood Canyon for more than two weeks. CDOT employees were immediately on-site to assess the damage, help trapped motorists, and put in place an emergency plan for clean-up and repair.

    Multi-year Projects. CDOT also undertakes many multi-year projects at any given time. Currently, the department is working to expand I-25 from Mead to Berthoud. Once this project is completed it will be the first time there will be more than two lanes on I-25 from Denver to Fort Collins in both directions. Other highway projects include the I-70 Floyd Hill project, I-70 mountain corridor project, I-76 York to Dahlia bridge reconstructions, and improvements to U.S. 85 (Santa Fe Drive). In addition, there is always the normal ongoing work of resurfacing streets; replacing traffic signals; constructing retaining walls, curbs, and bridge safety work; installing wildlife fencing; improving on-ramps; and relocating bike trails throughout the state to keep CDOT busy.

    Quite simply, CDOT helps Colorado motorists (as well as planes, trains, and buses) get where they need to go in rain, snow, or shine. There are no breaks for the maintenance and response crews—they are called out day and night, weekends, and holidays to highway accidents and road repairs.

    Thinking Outside the Box

    And if road maintenance and repair isn’t enough, CDOT, in collaboration with the Town of Frisco and the Department of Local Affairs, developed a plan to build single-family homes and apartments in Frisco to provide affordable housing for mountain-based employees. Making mountain housing more accessible will allow CDOT to recruit more employees and keep essential snowplow operators and other road maintenance specialists closer to the areas where they are needed.

    CDOT also boasts a Division of Aeronautics, a Division of Transit and Rail, regional bus service and environmental and research services. They even have an Archaeology and History department and a paleontologist on staff!  CDOT has been involved with the planning for establishing rail service through northwest Colorado and working with the Front Range Passenger Rail District on providing service along the Front Range, from Pueblo to Fort Collins and eventually to Wyoming and New Mexico. The recent enactment of Senate Bill 24-184 along with the availability of federal transportation money is expected to help fund these projects.

    Public Service. CDOT doesn’t just take care of the roads. It also plays an active role in trying to keep travelers informed on road conditions and even provides estimated travel times to help motorists make informed decisions. Their website houses extensive information on its programs, projects, and goals, as well as road and weather conditions (easily accessed through www.cotrip.org or by calling 511). Construction reports are available through the Travel page. For information about safety initiatives, visit the Safety page. You can also get general information about Express Lanes. And they even have their own YouTube channel.

    Planning for the Future

    Good transportation systems require a solid transportation planning process. Colorado’s transportation planning process includes the development of a Statewide Transportation Plan, Regional Transportation Plans, and a Statewide Transportation Improvement Program. The planning process goes through several levels of planning and routinely invites public involvement.

    • Regional Transportation Plans. The department gathers input from 15 planning regionsto develop regional transportation plans for each region. These plans typically establish long-term transportation investment priorities and are consolidated and incorporated in the Statewide Transportation Plan. 
    • Statewide Transportation Plan. State law requires that the department produce a 20-year plan and update it every few years. The current Statewide Transportation Plan (2045)estimates the state’s needs and revenue for the years 2016 to 2045.  The plan outlines funding, anticipated future transportation needs, and strategies to achieve its goals. 
    • Statewide Transportation Improvement Program. Federal regulations require the state to produce a Statewide Transportation Improvement Program (STIP).This is a 4‑year planning document for state transportation projects which CDOT updates annually. Projects included in the annual plans come from the 20-year statewide transportation plan. 

    CDOT also takes climate change into account in its planning process. For example, a rule change in 2021 requires transportation projects demonstrate that potential greenhouse gas emissions from the project not exceed certain limits.

    There’s no doubt about it, Colorado has a mobile society and transportation impacts its citizens—residents and visitors alike—on a daily basis.

    Sources:

  • Great Outdoors Colorado: Protecting Colorado’s Natural Playground

    by Faith Marcovecchio

    State lotteries fund all kinds of valuable things, from education to veterans’ services, Special Olympics to small businesses. But of the 45 states that sponsor lotteries, only six have created programs that use the proceeds to protect beautiful landscapes for everyone to enjoy. With Colorado’s stunning natural and recreational offerings, it’s no surprise our state is one of them.

    A 1992 ballot initiative amended the Colorado Constitution to create Great Outdoors Colorado (GOCO) and its associated trust to improve outdoor access and recreational opportunities, protect and restore the state’s land and rivers, and offer educational programs and internships. GOCO is funded entirely by a portion of the proceeds from the state lottery. When Amendment 8 proposing GOCO was passed by the voters in 1992, Colorado joined Minnesota and Arizona in setting aside lottery profits to conserve and protect state land. Since that time, Oregon, Maine, and Nebraska have adopted similar programs and trusts to protect their own outdoor heritage.

    The results in Colorado are astounding. In the 31 years since GOCO was established, over 5,500 projects have been completed in all 64 of the state’s counties, conserving 1.2 million acres and creating or improving just shy of 1,800 parks. To accomplish this, GOCO’s board, which includes two members from each congressional district in the state, partners with nonprofits, local governments, and Colorado Parks and Wildlife on a wide array of projects funded through the GOCO trust and matching grants.

    Doubtless, you’ve heard of some of them. The new Fishers Peak State Park near Trinidad was purchased with funding from GOCO in partnership with The Trust for Public Land, The Nature Conservancy, Colorado Parks and Wildlife, and the City of Trinidad. Greenland Ranch, the beautiful swath of open space you enjoy as you drive between Denver and Colorado Springs, was also funded by the lottery, this time with additional financial backing from private funders and Douglas County, in partnership with The Conservation Fund.

    On the Western Slope, GOCO, working with Colorado Parks and Wildlife, recently completed the Palisade Plunge, 32 miles of varied single-track trail that challenges mountain bikers as they ride from the top of Grand Mesa to the desert floor below. And on the Eastern Plains, rodeo lovers in Kim, Colorado, throng to events at the new Mustang Pavilion, made possible by GOCO, the Gates Family Foundation, the El Pomar Foundation, and community support.

    These are some of the marquee projects GOCO is known for, but the lottery also funds hundreds of smaller projects that quietly enhance and maintain beautiful spaces and recreational venues across our state, whether by removing noxious weeds in Crested Butte, improving the baseball fields and playgrounds in Washington County, or connecting bike trails in Louisville. GOCO has had a hand in them all.

    When voters passed Amendment 8 and added article XXVII to the state constitution in 1992, it was an important constitutional addition, but it wasn’t a stand-alone amendment. Article XXVII can only work in concert with article XVIII, section 7, which allows for a state-supervised lottery. In 1982, a state lottery division within the Department of Revenue was created in statute, but the division must be reauthorized continuously by bill. The most recent reauthorization happened in 2018, when Senate Bill 18-066 extended the division’s termination from 2024 until 2049. Though it’s unlikely the General Assembly would abolish our state lottery, by continuing it, the legislature also supports outdoor recreation in every county and corner of the state. For the next 25 years, that support will continue, and millions of Coloradans and visitors to our jewel of a state will benefit as a result.

    Colorado, play on!

  • Have roads. Will travel.

    Have roads. Will travel.

    by Patti Dahlberg

    According to the Colorado Department of Transportation (CDOT) Historic Timeline featured on its website, CDOT has been around in some form or another since 1910 – amazingly, only about six years after the first automobile reportedly showed up in Colorado and about 15 years after the first sale of an American-made gasoline car. The introduction of the automobile in Colorado and the commitment to improving the roads “paved the way” for easier travel throughout the state. In many ways, the story of CDOT is the story of the state of Colorado opening its doors for all to explore and enjoy. With the founding of the department, Colorado soon became a tourist destination.

    Purportedly, the first automobile in Colorado appeared in 1904 in Louisville. The first reported trip up a mountain road made by an automobile seems to have taken place in June of 1910, when Francis Percy “Frank” Loveland, the grandson of Colorado pioneer businessman W.A.H. Loveland, of Loveland Pass and the city of Loveland fame, drove up an old carriage road (with a 2,000 foot elevation change) from the Denver-metro area to the top of Mount Falcon (near Red Rocks). The 24-year-old drove his Stoddard-Dayton touring car from Morrison to the Mount Falcon summit (elevation 7,851 feet) in about 20 minutes. An hour earlier, he had set another record by driving from the Capitol building to Morrison in only 29 minutes.

    So how did we get all these roads that take us just about anywhere we want to go to? It started in the late 1870s with the “Good Roads Movement.”  Through this movement, which lasted into the 1920s, farmers’ and bicyclists’ organizations advocated for the investment of state and federal money in improving roads outside of the cities. At the time, the rural roads were dirt or gravel, which meant mud in winter, dust in summer, and slow travel year round. Obviously, these roads were generally bad for bringing goods to market and, of course, for bicycling. And in the mountains, wagon roads could be difficult to navigate and unusable for large portions of the year. When automobiles appeared on the scene, the automobile lobbies wholeheartedly joined in the movement.

    Colorado’s Legislature created its first State Highway Commission in 1909, charging it with the responsibility of establishing a network of state primary roads. In 1913, the Legislature created a series of registration and licensing fees as a funding source for the improvement of the Commission’s proposed 4,380-mile primary road system. The fees varied from $2.50 to $10 (from around $40 to $160 in today’s dollars) depending on the vehicle’s horsepower. By 1915, Colorado’s proposed highway system grew to 5,844 miles, but only about 2,600 miles of those roads were constructed and only 196 miles of them were actually surfaced.

    By the time Congress passed the Federal Aid Road Act of 1916, which provided federal matching funds for state highway projects, Colorado had already been busy constructing roads and mountain passes. In fact, a new automobile road over Wolf Creek Pass was opened to traffic that same year. In 1917, the Legislature reorganized its State Highway Commission into the State Highway Department and passed legislation to create a state highway fund to distribute state and federal funds to develop and maintain Colorado’s highway system. By 1918, the Highway Department laid the first concrete road in the state, which ran from Littleton to Denver along Santa Fe Drive. A year later, Colorado was one of the first four states to pass a gasoline tax, one-cent per gallon (the average price at the time was 25 cents/gallon, $3.22 per gallon in today’s dollars), to raise revenue for a special road fund.

    In 1921, the Legislature, largely in response to the U.S. Bureau of Public Roads’ (BPR) willingness to provide federal aid to states, reshaped and expanded the bureaucracy of the State Highway Department. In 1922, Colorado voters deemed transportation important enough to approve $6 million in bonds for highway construction, which would be over $1 billion today. The BPR approved Colorado’s first federally aided road system, covering 3,332 miles. By 1929 the Colorado State Highway system had grown to 9,203 miles, and by 1938 it was almost 12,000 miles.

    Mountain Roads, Scenic and Historic Byways

    Colorado is home to 26 Scenic and Historic Byways, around half of which are also designated as National Scenic Byways and recognized for their outstanding scenic and historic attributes. Colorado has more national designations than any other state. In 1924, the State Highway Department completed the “Million Dollar Highway,” the Scenic Byway through the San Juan Mountains in Southwestern Colorado on U.S. 550. In 1927, the Mount Evans Highway was completed and opened for travel to an elevation of 14,130 feet, just below the 14,264-foot summit of the mountain. It remains the highest elevation for a paved highway in North America.

    The first automobile crossed Loveland Pass on September 29, 1929, and in that same month work on Trail Ridge Road – the highest continuous paved road in the United States, had begun. The Great Depression brought in federal work projects to help Colorado continue to construct and maintain its mountain highways, as anyone who has driven over Trail Ridge Road and read any of the signs knows. Between 1938 and 1940, Colorado completed the roads over Berthoud Pass (U.S. Hwy 40), Monarch Pass, and the original highway (U.S. Hwy 6) over Vail Pass. Gold prospectors may have brought skiing to the Colorado Rockies in the 1860s, but it was passable mountain roads that enabled it to become the popular winter sport that it is today.

    The boring of the westbound Straight Creek Tunnel (later to be named the Eisenhower Memorial Tunnel) through the Continental Divide to align I-70 near Vail with the existing U.S. Hwy 6 started in 1963 and finished in 1973. The eastbound bore of the Continental Divide tunnel opened in 1979 and was named in honor of former U.S. Senator and Colorado Governor Edwin C. Johnson. The combined tunnels are now officially known as the Eisenhower-Johnson Memorial Tunnel complex.

    And then there’s the crown jewel of Colorado mountain highways – I-70 through Glenwood Canyon. Construction began on “the final link” of west-bound I-70 through the canyon in 1980. Less than 15 miles long, the segment was completed in October of 1992 for around half-a-billion dollars. One of the biggest challenges CDOT faced was how to squeeze a four-lane freeway into a gorge barely wide enough to accommodate the existing two-lane highway and how to do so with minimal impact to the environment. CDOT’s solution was clever: construct two roadways, one nearly on top of the other. The final design features an elevated roadway with 40 bridges and viaducts spanning more than six miles between sections. Construction materials included 15 miles of retaining walls, two 4,000 foot tunnels, 150,000 newly planted trees and shrubs, 30,000 tons of steel, and 810,000 tons of concrete. Soon to be 30 years old, the Glenwood Canyon portion of I-70 is not only a beautiful stretch of road, but considered by many to be a modern marvel. The two-tiered elegantly sculpted highway through the Colorado River gorge remains a vital transportation corridor and a popular tourist attraction. The 12.5-mile engineering feat has received a presidential commendation and numerous design awards. It has been featured in books and in a museum exhibit on 20th century engineering achievements.

    Sources:

  • Statutory Powers to Address Epidemics

    by Jery Payne

    It’s a little known fact, but being a smart audience, you may have heard that an epidemic engulfed the nation and the world, which makes the epidemic a pandemic. It’s commonly known as “COVID-19,” which is a shortening of the phrase “Corona Virus Disease of 2019.”

    In 2020, the governor of Colorado declared an emergency and invoked emergency powers to address the spread of the virus. The state required people to stay at home as much as possible, mandated people wear masks, and implemented many other mandates. Local health agencies also issued mandates. This led many people to wonder, “Can they do that?” And like any good lawyer, I’m going to say, “It depends.”

    The Department of Public Health and Environment and local health agencies have many powers to control epidemics. First, the department has many statutory powers to protect public health, including the power to:

    • Close theaters, schools, and other public places, and to forbid gatherings of people;
    • Establish and approve laboratories;
    • Conduct laboratory investigations and examinations;
    • Establish and enforce standards for diagnostic tests by laboratories;
    • Purchase and distribute to licensed physicians, with or without charge, vaccines and other therapeutic products as necessary for the protection of public health;
    • Establish and enforce sanitary standards for the operation of just about any place used for public gatherings; and
    • Determine if there is a shortage of drugs critical to the public safety of the people of Colorado and declare an emergency to prevent the practice of unfair drug pricing.

    In addition, the department has several statutory powers specific to addressing epidemics, including the power to:

    • Investigate and control the causes of epidemic and communicable diseases affecting public health;
    • Require any person who has epidemic information to report the information to the State Board of Health, without patient consent, of occurrences of the epidemic or disease;
    • Access patient medical, coroner, and laboratory records relating to epidemic and communicable diseases determined to be dangerous to public health;
    • Investigate and monitor the spread of epidemic;
    • Establish and enforce isolation and quarantine, and, for this purpose only, exercise physical control over property and the people necessary for the protection of public health; and
    • When a specific place is a continuing source of an epidemic, make it stop, and if necessary, eliminate it.

    Together, these state statutes give the department broad powers to address epidemics.

    Local public health agencies, including county, municipal, and district agencies, also have statutory powers, granted by state law, to control epidemics within their jurisdictions. Local public health agencies have the power to:

    • Carry out the public health laws and rules of the state board;
    • Administer and enforce the orders, rules, and standards of state health agencies;
    • Investigate and control the causes of epidemic or communicable diseases;
    • Establish and enforce isolation and quarantine, and, for this purpose only, exercise the physical control over property and the people necessary for the protection of public health;
    • Close schools and public places and prohibit gatherings of people when necessary to protect public health;
    • When a specific place is a continuing source of an epidemic, make it stop, and if necessary, eliminate it;
    • Establish and approve laboratories;
    • Conduct laboratory investigations and examinations;
    • Purchase and distribute to licensed physicians, with or without charge, approved therapeutic products the agency determines is necessary to protect public health;
    • Initiate and carry out health programs consistent with state law; and
    • Make necessary sanitation and health investigations and inspections for matters affecting public health.

    Local boards of health are the policy-setting bodies for local health agencies. They develop policies and procedures to address epidemics and to administer and enforce the powers granted to local health agencies. This includes adopting rules and orders. Specifically, local boards of health have the statutory power to:

    • Develop and promote the public policies needed to secure the conditions necessary for a healthy community;
    • Determine general policies to be followed by the public health director;
    • Issue orders and adopt rules necessary for the proper exercise of the powers and duties vested in the local public health agency;
    • Accept and, through the public health director, use, disburse, and administer all aid for purposes that are within the functions of the local agency; and
    • To make agreements that may be required to receive money or other assistance.

    A person who is negatively affected by a decision, which can be a rule or order of a state or local health board, department, or agency, may seek judicial review. The person must bring the case within 90 days after the decision is publicly announced. The court may affirm the decision or may reverse or modify it if the rights of the person have been prejudiced because the decision is:

    • Contrary to constitutional rights or privileges;
    • In excess of the statutory authority or jurisdiction of a state or local health board or agency;
    • Affected by any error of law;
    • Made or promulgated upon unlawful procedure;
    • Unsupported by substantial evidence in view of the entire record; or
    • Arbitrary or capricious.

    Except in certain types of cases, judicial review of a board decision is conducted by the court without a jury. Even when statutory authority exists, a decision that violates the Colorado Constitution or the United States Constitution will be struck down if challenged. If a particular mandate is challenged, the court will review the record to determine whether to uphold or overturn the mandate based on whether the mandate is a reasonable use of the authority to protect public health.

    Although my guess is that not many people have flipped through these statute pages for a mighty long spell, you can bet that they have certainly been flipped through a lot lately. These statutes are useful guides as we wend our way through these weird times.

  • Addition by Division or How to Create a Judicial District in Colorado

    by Conrad Imel

    Recently, the General Assembly created a twenty-third judicial district in Colorado. But can the General Assembly just make a new judicial district? Even though the judicial department is a separate branch of the government, the state constitution says it can. In this article we’ll look at the General Assembly’s role in creating and changing judicial districts and the recent change that it made.

    Judicial districts are responsible for operating district courts within the district.[1] District courts are the courts of general jurisdiction in Colorado. They hear civil cases involving any dollar amount, criminal matters, and domestic relations cases. District courts also hear cases involving probate and minors, such as adoption, dependency and neglect, and juvenile delinquency; except in Denver, which has a separate probate court and juvenile court to handle these cases.

    Judicial districts weren’t created by the legislature to administer courts; they are required by the state constitution. Article VI, section 10 of the Colorado Constitution declares that “[t]he state shall be divided into judicial districts” and authorizes the General Assembly to change the number and boundaries of judicial districts with a two-thirds vote of the members of each chamber. Presently, state courts are divided into 22 judicial districts. Some districts contain multiple counties while others consist of a single county. Click here to see a map of Colorado’s judicial districts.

    Colorado’s constitution initially provided for four judicial districts with one judge each. Five years later, in 1881, the General Assembly added three new judicial districts, bringing the total number of districts to seven. The General Assembly regularly increased the number of judicial districts over the next 82 years, culminating with the creation of the 22nd Judicial District in 1963. It wouldn’t add another district for nearly 60 years.

    In 2020, the General Assembly passed House Bill 20-1026, creating a twenty-third judicial district that will begin operations on January 7, 2025. Currently, the 18th Judicial District consists of Arapahoe, Douglas, Elbert, and Lincoln counties. Beginning in 2025, three of the four counties, Douglas, Elbert, and Lincoln, will leave the 18th Judicial District and become the new 23rd Judicial District, served by eight judges. HB 20-1026 decreases the number of judges in the 18th Judicial District by seven, from 24 to 17. The bill easily satisfied the constitution’s two-thirds vote requirement, receiving just two “no” votes in the House and one in the Senate.

    For a legislator, creating a new judicial district isn’t as simple as sponsoring a bill and getting two-thirds of your colleagues to agree to it. The state constitution includes a few requirements for judicial districts and judges that the bill sponsor (and bill drafter!) need to keep in mind. First, article VI, section 13 of the Colorado Constitution requires that each judicial district have an elected district attorney, and section 1-4-204, C.R.S., provides that district attorneys are elected at a general election (held in even-numbered years). Any bill establishing a new judicial district will need to account for a district attorney election and the time it takes the newly elected district attorney to assume the office.

    Additionally, the Colorado Constitution requires a district judge to reside in the judicial district in which the judge serves and prohibits abolishing a judge’s office until the end of the judge’s term. A judge may be required to change districts, though, so long as the judge resides in the new district. To comply with these constitutional provisions and ensure that both the new and continuing judicial districts have the proper number of judges who reside in their respective districts, the bill sponsor needs to carefully consider the date the new district will begin operations and account for where the judges of the existing district reside.

    It may not happen as often as it used to, but as long as two-thirds of the members agree, the General Assembly can change the state’s judicial districts. Even if the legislature waits another 50 years to do it again, it will need to be mindful of when the new district begins operations to avoid any constitutional issues.

     

    [1] Judicial districts also operate county courts, except for Denver County Court, which is operated by the City and County of Denver and is, in effect, a combined municipal and county court.

  • A Tale of Two Amendments: The Property Tax Dilemma

    By Vanessa Cleaver

    As any long-term resident of Colorado knows, over the past five years the state has undergone an explosive growth in population, making it one of the fastest growing states in the United States. Consequently, Denver’s housing market is booming, and Denver-metro residents have likely seen a steady rise in their property’s value. This increase would normally correlate to an increase in residential property taxes, but because of an interesting provision in the state constitution known as the “Gallagher Amendment,” residential property tax rates remain unequivocally low. For rural areas that are primarily supported by property taxes, and where property owners have not seen the exponential increase in property value that Denver has, the Gallagher Amendment has left local governments with less revenue to support a steadily growing population.

    Enacted as part of a constitutional amendment in 1982, the Gallagher Amendment was initially designed to maintain a constant ratio between property tax revenue from residential property and from commercial property. Although perhaps not its original intent, Gallagher has since kept property taxes low for homeowners so they aren’t financially overburdened by their property tax bill should their property value increase. It establishes a formula precluding the assessed value[1] of all residential property from being more than a target percentage[2] of the total assessed value of all real property in the state. Businesses, on the other hand, are responsible for fulfilling the remainder of that target percentage.

    Rather than set varying assessment rates across the state, Gallagher instead sets one statewide rate for residential property and one for commercial property. The commercial assessment rate was set at a fixed 29 percent while the residential assessment rate (RAR) was left to float up or down. Since there’s no set minimum for the RAR, it can drop as low as it needs to in order to uphold that constitutionally mandated balance between commercial and residential property. As complicated as all that sounds, basically what it comes down to is this: When residential property values go up relative to non-residential values, the RAR decreases; when property values drop, the RAR is technically supposed to increase again.

    But to add to the complexity of Gallagher, in 1992 voters passed an amendment to the Colorado constitution, commonly known as “TABOR,” which states, in part, that all increases in the valuation for assessment ratio for a property class must be approved by voters. This new restriction made any rise in the RAR subject to voter approval. Even in those years when Gallagher dictated an increase, the RAR remained unchanged because the General Assembly did not seek voter approval for the increase under TABOR. Since the inception of Gallagher, and especially since being tethered to TABOR, the RAR has been in steady decline. In 1983, the RAR established in the state constitution was 21 percent, the highest the rate has been in the past 30 years. Currently, the RAR is 7.2 percent,[3] and it appears that the General Assembly may need to lower it again in future reassessment cycles.[4]

    So what does all this have to do with local governments?

    With the exception of municipalities, a large number of local governments get most of their revenue from property taxes. Services such as fire protection, public education, and the establishment and operation of local libraries are primarily funded through the collection of property taxes. If there’s a decrease in that revenue, then those types of local governments struggle to provide even the most necessary services to their residents. Over the last few years local governments in rural Colorado have seen a significant decrease in property tax revenue. Specifically, fire districts, school districts, library districts, and other special districts have been impacted in their ability to support the populations they serve. This drop in revenue is primarily attributed to the continued fall of the RAR.

    As property values increase in the more metropolitan areas of the state, the RAR continues to fall to keep property taxes from going over the target percentage required by the Gallagher Amendment. For the Denver metro area, this drop in the RAR hasn’t had nearly as significant an impact on revenue, because it has a denser population to support it, and because home values in Denver have skyrocketed. But in rural Colorado, home values, as well as local populations, aren’t experiencing that same boom, and in some cases rural residents are paying less in property taxes than they have in years past.

    Prior to the passage of TABOR, a special district could float its mill levy (the number of mills assessed by a local government against the assessed property value, resulting in more property tax revenue) to counteract any cyclical economic cycles and help protect its primary revenue source. For example, a special district could raise its mill levy when the RAR decreased to ensure the incoming property tax revenue remained constant, and then decrease the levy if property values increased again. Since TABOR’s passage, though, special districts can float their mill levies down but are prohibited from floating their mill levies back up without a vote of the people, a costly and sometimes fruitless endeavor.

    Fire protection districts in particular have voiced great concern over their capacity to fight the wildfires that ravage the state every summer with a steadily decreasing budget, staff, and resources. In 2018, after being urged by the Colorado State Fire Chiefs, in conjunction with the Special District Association of Colorado, former Governor John Hickenlooper filed interrogatories with the Colorado Supreme Court asking them to weigh-in on the issue. The former governor submitted three legal questions: 1) whether TABOR and the Gallagher Amendment conflict with one another in the way they affect property taxes; 2) whether TABOR should take precedence over Gallagher; and 3) whether Gallagher should be stricken from the constitution altogether. The Court, however, declined the interrogatories.

    The property tax dilemma has, for now, been left in a state of uncertainty. Until a more permanent solution is reached that meets both the needs of taxpayers and local governments, the Gallagher Amendment in its current construct will continue to govern property tax law.

    [1] “Assessed value” is the base amount, which is equal to the actual value multiplied by the assessment rate, upon which property taxes are levied. A local government may assess a certain number of property tax mills against the assessed value of a piece of property. A mill is equal to 1/1000 of one dollar or $0.001.

    [2] The target percentage is used to maintain the ratio between residential property tax revenue and commercial property tax revenue. At Gallagher’s onset the target percentage for commercial property was 55 percent, with residential property responsible for the remaining 45 percent. But over the years the target percentage has slightly deviated from this 55/45 split. To give you an idea, in 2017 it was 54.33/45.67, and in 2015 it was 54.24/45.67. https://apps.larimer.org/tencounty/conference/2017/Gallagher-Slides-updated.pdf

    [3] § 39-1-104.2 (3)(p), C.R.S.

    [4] The Residential Assessment Rate Study for 2019-2020 projecting the new residential assessment rate to be 6.95 percent: https://drive.google.com/file/d/1o3HgqYCkWnDIQkRQx4YIxPi2Z0EiQHDz/view

  • Maximum Reserve

    by Ed DeCecco

    Sadly, “Maximum Reserve” is not the name of the next Jerry Bruckheimer summer blockbuster. Nor is it even an oft used term. By last count, it appears in a measly .0000003% of sampled books. That makes your odds of randomly picking up a book with this phrase about the same as winning the lottery.  Unless, that is, your book shelf possesses three feet of handsome red volumes, known as the Colorado Revised Statutes. Then this is indeed your lucky day because “maximum reserve” is a defined term in section 24-75-402, C.R.S., and is at the heart of the statutory limit on the uncommitted reserves in a cash fund.

    The “maximum reserve”[1] is defined as “sixteen and five-tenths percent of the amount expended from a cash fund during the fiscal year” and is used to create a limit on the uncommitted reserves in a cash fund at the end of a fiscal year. So, if a state agency spends $1,000,000 from a cash fund during a fiscal year, then the maximum amount that can be left in the cash fund at the end of the year is $165,000, which is roughly equal to two months of its spending.

    Except if it is not. Sometimes an alternative limit is appropriate. To address this, the General Assembly created the cleverly named “alternative maximum reserve,”—side note: also a good name for the movie sequel—which is a maximum reserve balance established in the constitution, by law, or Joint Budget Committee (JBC) waiver (more on that later) that is different from 16.5% of the amount expended. For example, the General Assembly could establish an alternative maximum reserve of 25% of the amount expended or even a specific dollar amount.

    If a state agency exceeds the applicable reserve limit for a fiscal year, then it is required to reduce the fees the agency collects in the next year so that it won’t do so again. The agency may subsequently raise a fee, but only if doing so won’t cause it to have excess uncommitted reserves. And if there are excess uncommitted reserves for three or more years, then the agency must deliver a hostage to the State Controller’s office until it complies. (Sorry, I’ve been binge watching Game of Thrones.) The real penalty is that the State Controller will restrict the amount of money available to be spent from the cash fund.

    Now, a statutory requirement without exceptions is like an Elvis impersonator without a sequin jumpsuit, and the limitations on uncommitted reserves are replete with them. The limit only applies to a “cash fund,” which in this context means “any fund that is established in law for a specific program or purpose and that includes moneys from fees,” but excluding the state general fund, any federal fund, and a fund used by a state institution of higher education. So, you’ll be happy to know that the state is free to have a general fund surplus that exceeds the maximum reserve.

    In addition, a cash fund is a depository for “fees,” which, for purposes of the maximum reserve, are any money collected or received by an entity but excluding, among other things:

    • Revenue that is not state fiscal year spending;
    • Fines or other criminal penalties;
    • Money transferred from the state general fund;
    • Non-discretionary charges or assessments;
    • Interest and income; and
    • Gifts or donations. (Everybody loves gifts. C’mon, who would want a cap on those?)

    So if a cash fund consists entirely of non-fee revenue, then the maximum reserve does not apply, and if a cash fund is a mix of fee and non-fee revenue, then the non-fee revenue is proportionally excluded from the uncommitted reserves.

    But wait! That’s not all! The limit on uncommitted reserves also doesn’t apply to cash funds established to fund capital construction, cash funds with uncommitted reserves that are less than $200,000, cash funds only used for a program that is less than two years old, and a bunch of cash funds that are expressly excluded from the limit.

    Finally, a state agency can solicit the JBC for a waiver from the maximum reserve based on specific circumstances. The JBC can, for up to three years, grant an exemption or establish an alternative maximum reserve for the agency. Given that state agencies sometimes have perfectly good reasons to exceed the maximum reserve, this seems like an efficient alternative to enacting legislation to specifically exempt a single cash fund. And fewer bills to be drafted means fewer bill drafters…hey, wait a minute!

    Admittedly, there are numerous exceptions. But considering that there are scads of cash funds,[2] it still has a broad application. Plus, these exceptions can be better understood when viewed in light of the avowed purpose of the limit on uncommitted reserves. Because fees contribute to the TABOR fiscal year spending limit, it is necessary to keep them in check by establishing a reasonable reserve derived from fee revenue.

    And don’t think that the limit on uncommitted reserves was created and then immediately forgotten—like this legislative staff blog article, for example. The State Controller is required to annually prepare a report to be delivered to the JBC and the Office of State Planning and Budgeting identifying the uncommitted reserves for each state cash fund, and the State Auditor is required to audit the report.

    Well, that’s probably about all you want to read about limits on uncommitted reserves for cash funds, and I need to start work on my screenplays for the “Maximum Reserve!” movie franchise, so I bid you adieu.

     

    [1] The “maximum reserve” was formerly known as the “target reserve,” which gave the misimpression that state agencies should aspire to have that amount in reserve at the end of each year. Thanks to Alfredo Kemm, Joint Budget Committee Staff, for suggesting the sensible rebranding.

    [2] Perhaps, too many? See “A Legislator’s Guide to Creating Cash Funds.”

  • An Overview of the Colorado Attorney General’s Office and Its Relationship to the General Assembly

    by Abby Chestnut

    “If I am going to pick and choose the laws I defend, I wouldn’t be doing my duty as attorney general.” – Kelly Ayotte, Former Attorney General for New Hampshire

    The “duty to defend” is commonly understood to be central to the role of the state attorney general, but this duty is also one that serves the General Assembly. Without an institution that is charged with enforcing and defending the state’s laws, the work of the state legislature could be ignored and thereby rendered ineffectual. The Attorney General (AG) ensures that the laws that the General Assembly labors to produce each session have an effect on the lives of Coloradans.

    Created by the Colorado Constitution, the office of Attorney General, housed in the Department of Law, is technically an executive branch agency. However, the AG’s Office in Colorado is headed by an independently elected attorney general who can serve a maximum of two four-year terms. The Colorado AG is charged with serving as the legal counsel for every department or division of the state and representing the state in any action in which the state is a party or is interested, with few exceptions. The Attorney General does not represent the legislative branch, though the General Assembly may request a formal attorney general opinion from the AG on questions of law. In terms of specific powers, the Colorado Supreme Court has held that the Attorney General gets his or her authority from two places: the common law—unless the General Assembly specifically repeals these powers—and statute.

    It is also worth noting that as an independently elected official, the AG does not report to the Governor. The AG represents the state, a position that was reinforced by the Colorado Supreme Court recently when Governor Hickenlooper tried to block Attorney General Cynthia Coffman from suing the federal government over the Clean Power Plan. The court declined to issue an opinion on the matter, stating that there were alternative remedies available. Although the AG’s office may represent the Governor in some capacities and may issue legal opinions to the Governor, litigation control rests with the AG, and the Governor may not direct the AG to cease litigation. In certain circumstances, the Governor or other state agencies can employ outside legal counsel should the AG be unable to provide the legal services needed. In practice, the two offices may confer on major issues, but there is no obligation to cooperate.

    The Department of Law, in which the AG’s office is housed, is organized into eight main sections:

    1. Business and Licensing: This section represents the Department of Regulatory Agencies and many of its divisions, the Department of Agriculture, the State Personnel Board, the Independent Ethics Commission, the Mined Land Reclamation Board, the State Claims Board, and the Office of the Child Protection Ombudsman.
    2. Revenue and Utilities: This section represents the Department of Revenue, the Trial Staff of the Public Utilities Commission, the Property Tax Administrator and Property Tax Division, and statewide clients regarding bankruptcy matters.
    3. State Services: This section represents half of the executive branch state agencies in Colorado (including the Department of Labor, Department of Education, Department of Higher Education, and the Colorado Department of Health Care Policy and Financing), as well as Colorado’s five elected public officials: the Governor, Lt. Governor, Attorney General, Secretary of State, and Treasurer.
    4. Consumer Protection: This section represents Colorado consumers by prosecuting fraud; enforcing consumer protection and antitrust laws; implementing the Tobacco Master Settlement Agreement; enforcing state laws on consumer lending, predatory lending, debt collection, rent-to-own, debt management, and credit repair; and advocating for residential, small business, and agricultural public utility ratepayers through the Office of Consumer Counsel.
    5. Criminal Justice: This section provides assistance to district attorneys in certain types of cases and prosecutes multi-jurisdictional cases involving human trafficking, major drug trafficking organizations, and white-collar and environmental crimes. This section also prosecutes crimes in which the AG has original jurisdiction: securities, insurance, and election fraud.
    6. Criminal Appeals: This section is responsible for all Colorado criminal prosecutions at the appellate level.
    7. Natural Resources and Environment: This section represents the Colorado Department of Natural Resources and the Colorado Department of Public Health and Environment and advocates on behalf of the Colorado Resources Trustees and the Colorado Energy Office.
    8. Civil Litigation and Employment: This section defends all state agencies and employees that are sued in state or federal court for personal injuries, property damage, employment discrimination, or constitutional violations. This section also serves as general counsel to a host of agencies, including the Colorado Department of Transportation, Department of Corrections, State Board of Parole, POST Board, and Civil Rights Division.

    The AG’s Office also houses the Office of Community Engagement, an office dedicated to informing the public about the work of the AG’s Office and engaging citizens in dialogue about solutions to social issues within the purview of the office. This office also houses the Safe2Tell program, which provides an avenue for a student, parent, school staff, or concerned community member to anonymously make a report if he or she believes there may be a safety threat.

    The Department of Law, which employs about 270 attorneys, is the largest law firm in the state of Colorado, but its size matches its charge. It is responsible for representing almost every arm of state government and defending all of the state’s laws. This massive task is led by an independently elected attorney general whose duty is to the state, its laws, and its citizens. Though the AG’s office does not legally represent the General Assembly, the AG’s responsibility as the state’s chief law enforcement officer establishes an important relationship between the two government entities.

  • Colorado State Government Spotlight: Department of Higher Education

    by Julie Pelegrin

    Fifth in a series focusing on the organization of state government. Click here for DORA – Part 1, Secretary of State – Part 2, Education – Part 3, and Revenue – Part 4.

    In accordance with their mission, the Colorado Department of Higher Education (Department) and the Colorado Commission on Higher Education, known as CCHE, work with  more than 450 Colorado public and private institutions of higher education in the state to provide access to high-quality, affordable education for all Colorado residents that is student-centered, quality-driven, and performance-based. To fully accomplish this mission, the Department not only works with the higher education institutions (enrolling more than 430,000 students), but also works with middle and high schools, students and their families, and, unexpectedly, the state historical society. (more…)

  • Colorado State Government Spotlight: The Department of Revenue

    by Chuck Brackney

    Fourth in a series focusing on the organization of state government. Click here for DORA – Part 1, Secretary of State – Part 2, and Education – Part 3.

    The Colorado Department of Revenue (DOR) is among those agencies that have responsibilities for a wide-ranging number of programs.  While it’s not surprising that they are in charge of collecting taxes, they also have several less-obvious areas of expertise, from motor vehicles and driver’s licenses to liquor regulation and the state lottery.  DOR also has the authority to regulate medical marijuana and will take over a similar task for retail marijuana when its sale and use becomes legal in 2014. (more…)