The federal appeals court based in Denver has dismissed the long-running lawsuit seeking to void Colorado's Taxpayer Bill of Rights, finding in a 7-2 decision that a collection of local governments has no basis to challenge the 1992 constitutional amendment.
Chief Judge Timothy M. Tymkovich, writing for himself and six of his colleagues, concluded that the Boulder County Board of County Commissioners, a handful of school districts and one special district failed to show that the 1875 Enabling Act that guaranteed to Colorado a "republican" form of government had also given the local government entities the ability to challenge TABOR's taxing and spending restrictions.
"Looking at the Enabling Act’s language, we conclude the plaintiffs cannot state a claim under the Act’s promise of a republican constitution. Neither the Enabling Act’s text nor structure supports the political subdivisions’ arguments. The clause promising a constitution republican in form has no clear beneficiary," Tymkovich wrote in the Dec. 13 decision.
The ruling of the U.S. Court of Appeals for the 10th Circuit represents a blow to opponents of TABOR, who argue that it has starved governments of revenue and made crucial funding obligations, such as education and transportation, more difficult through the imposition of tax increases only at the permission of voters.
The plaintiffs argued that a "republican" form of government involves taxation and spending decisions made by elected leaders. Gov. Jared Polis and Attorney General Phil Weiser, both Democrats, defended against the lawsuit.
Joining Tymkovich, an appointee of former President George W. Bush, were Judges Harris L Hartz and Jerome A. Holmes, also Bush appointees; Allison H. Eid, a Trump appointee; and Robert E. Bacharach, Carolyn B. McHugh and Nancy L. Moritz, appointees of former President Barack Obama.
Senior Judge Mary Beck Briscoe, a Clinton appointee, and Judge Gregory A. Phillips, also an appointee of Obama's, dissented.
The decision encompassed four separate opinions in which all four Republican appointees advocated for tossing the case without an opportunity for the plaintiffs to refile their claims in the trial court.
The three Obama appointees who joined the majority refused to go along with that approach. They believed that barring the plaintiffs from pursuing the lawsuit any further would unfairly advantage the governor, and would prohibit the plaintiffs from introducing at the trial court potential evidence about Congress's intent in guaranteeing a republican government in Colorado.
That type of evidence, wrote Bacharach for himself, McHugh and Moritz, would serve to "discern Congress's intent."
In a separate concurring opinion featuring only the appointees of Republican presidents, Tymkovich was far less restrained about the lawsuit. Tymkovich, with support from Hartz, Holmes and Eid, waved aside the local governments' concerns about TABOR's interference with their taxation powers.
"The plaintiffs seem to believe the federal courts can infer with Goldilocks-precision how much interference is 'too much' and 'just right.' And, even assuming a grain of truth in the plaintiffs’ argument that taxing is a core legislative power (bearing in mind that the United States had no national income tax until 1913), assigning a role to the electorate in raising taxes and setting tax policy hardly changes a republican government into something akin to a monarchy," Tymkovich wrote.
Meanwhile, the final opinion from Briscoe disagreed with large swaths of the other judges' statements. She and Phillips believed the majority had taken the simple question of whether the local governments could sue to enforce their alleged rights, and, in effect, killed off future versions of the lawsuit by deciding the Enabling Act provided no basis for a claim.
"By going further than necessary, the majority deprives the plaintiffs of all the benefits of a pending, open case and leaves them and others like them with precedent that makes it almost impossible to bring a claim," she wrote.
In all, the five Democratic appointees believed the lawsuit should continue at the trial court level, at least in some form.
The lawsuit seeking to overturn TABOR began in 2011 under then-Gov. John Hickenlooper. The plaintiffs at the time were largely state lawmakers. In the ensuing decade, the case would reach the 10th Circuit multiple times, and the U.S. Supreme Court once.
Once the dust settled on the prior appeals, the individual legislators did not have standing to sue and the new local government plaintiffs sought a ruling from the 10th Circuit that would grant them the ability to prove to the trial court that TABOR runs contrary to the Enabling Act and the Guarantee Clause of the U.S. Constitution. They appealed the case en banc — a rare proceeding in which all judges participate, instead of the customary decision by a three-judge panel.
The 10th Circuit had the opportunity to clarify the circumstances under which local governments are in a position to file suit against their states under federal law. The majority agreed to shift its evaluation to asking whether local governments had actually brought a legitimate claim. The opinion indicated that courts should be "hesitant to infer that Congress intended to intrude on internal state matters" with federal legislation.
The majority answered that, in this instance, the Enabling Act did not give rise to the ability of local Colorado governments to claim TABOR violated the promise of a republican government.
"The Act does not specify for whom the protection is intended or give any indication that a republican government is a right intrinsic to being a political subdivision," Tymkovich concluded.
Penn R. Pfiffner, the chairman of the TABOR Committee, which advocates for the TABOR amendment, generally praised the majority's decision. He believes the lawsuit implicated the broader question of whether citizens can constrain certain aspects of government through the ballot box.
"In the majority opinion, Chief Judge Tymkovich observed that TABOR was remarkably durable, and I think that’s because people recognize that they don’t want to turn over to the government an unconstrained ability to grow. Instead, we want to control the rate of that growth," said Pfiffner, a former Republican state representative.
Over the past three decades, there have been attempts to repeal, curtail or otherwise modify the scope of TABOR, to varying degrees of success. Most notably, Referendum C in 2005 afforded a temporary break from the revenue limitations of TABOR. Since then, a 2020 ballot measure that would have allowed the state to keep money otherwise refunded to taxpayers failed to pass. Also that year, a proposal to repeal TABOR did not make it to the ballot.
Lawmakers have sometimes resorted to fees and tax code changes in the absence of direct authority to hike taxes due to the amendment.
David E. Skaggs, a lawyer for the plaintiffs and a former Democratic member of Congress, said he is reviewing the options available at the district court level in light of the ruling.
The case is Kerr et al. v. Polis.