Multiple judges on the Denver-based federal appeals court were open to deciding what Congress meant when it granted a "republican" government to the state of Colorado more than a century ago, and whether local governments can sue to overturn a constitutional amendment that allegedly violates the guarantee.
On Monday, in a rare all-judges hearing of the U.S. Court of Appeals for the 10th Circuit, nine members of the appellate court weighed whether local governments are permitted to sue the state and seek repeal of the 1992 Taxpayer Bill of Rights amendment. If successful, the plaintiffs would eliminate a longstanding bogeyman for Colorado progressives, as TABOR has placed restrictions on tax increases and revenue collection that have stymied investments in essential government services.
But for the decade-old lawsuit to reach a resolution, there must be an answer to a seemingly-simple question.
“What is a republican form of government?” asked Chief Judge Timothy M. Tymkovich during oral arguments.
The plaintiffs, which include multiple school districts, the Boulder County Board of County Commissioners and a special district, believe TABOR runs counter to the guarantee in the 1875 Enabling Act making Colorado a state, that its government be "shall be republican in form." Taking away taxing and spending decisions from elected legislators, the plaintiffs argue, has deprived them of their responsibilities in a republic, and as such, the local governments have standing to sue the state.
“The requirement of a republican form of government is not an individual right, but rather a collective and structural one, because it is the right to be governed by representative institutions that are given separate and specific powers to ensure the common welfare," argued Sarah M. Mercer, an attorney with Brownstein Hyatt Farber Schreck representing the plaintiffs.
On the other side, Gov. Jared Polis and his lawyer, Assistant Attorney General Michael Kotlarczyk, believed a lower court judge had correctly found the right to a republican form of government did not extend to local governments, known legally as political subdivisions.
“The current set of plaintiffs consists of a group of political subdivisions who argue they are now the right plaintiffs to overturn taxing law passed by the people of Colorado," Kotlarczyk told the 10th Circuit. "The court should find that they’re wrong."
During the course of oral argument, Tymkovich raised the question that if local governments could not sue to enforce the guarantee of a republican form of government, who could? Kotlarczyk responded that there may not be anyone who could, save for the General Assembly.
“What if, say, Colorado, by initiative, completely abolished the General Assembly?" Tymkovich wondered. “Even in that extreme hypothetical, there would not be a plaintiff, either a political subdivision or a citizen or a legislative entity, that could bring a challenge?”
“There may be," said Kotlarczyk, declining to name a specific entity who would be eligible.
“Interesting if we end up with a monarch," Tymkovich replied, "and how do we challenge that.”
In the mind of Madison
Oral arguments in the lawsuit took place before the entire membership of the 10th Circuit, which hears federal appeals from Colorado and five other states. The hearing, known as "en banc" review, is a rarity. From October 2018 through September 2019, the 10th Circuit only heard one case en banc out of more than 1,100.
Currently, there are 10 active judges on the 10th Circuit, two of whom recused themselves from participation in the TABOR case. The remaining eight active judges, plus Senior Judge Mary Beck Briscoe, constituted the en banc court. In all, five judges were nominees of Democratic presidents, and four were nominees of Republicans.
A majority of active judges voted last October to hear the case en banc, after a three-member panel in 2019 sent the lawsuit back to a lower court judge with instructions to determine what a republican form of government entailed. Mercer argued to the 10th Circuit that such an inquiry was still needed, even though Judges Carolyn B. McHugh and Harris L. Hartz suggested the appellate court had enough information to decide the question.
“I’m a little perplexed about the argument that we need to send it back," said McHugh. "It seems to me we’re not in a position where you can call into a deposition, subpoena Madison, and say, 'Hey, what did you mean?'"
McHugh's reference was to James Madison, the fourth president of the United States and a key figure in the drafting of the U.S. Constitution. In article #10 of the Federalist Papers, which Mercer referenced to the court, Madison wrote that a republic entailed the delegation of governing to "a small number of citizens elected by the rest."
David E. Skaggs, another attorney representing the plaintiffs who himself is a former state legislator and congressman from Boulder, said afterward that it would be unprecedented for a court of appeals to provide the type of scholarly analysis of a republican form of government that some judges seemed to favor.
"We need historical context and interpretive help that has never arisen in a court decision because no court has ever decided what that language means," he said.
The Independence Institute, a libertarian think tank in Colorado that backs TABOR, has in turn labeled it a "misreading of republican political theory and American history" to claim the constitutional provision divests elected bodies of taxing and spending power.
"[P]art of our founding American theory is that the people consent to taxation, and that the people create a representative legislature merely as a concession to practicality," wrote senior fellow Robert G. Natelson in a 2016 report. "As direct democracy becomes more practical, the people can be expected to resume a larger share of control."
The plaintiffs cautioned that the lawsuit was not a means of attacking Colorado's entire direct democracy process of ballot initiatives and referenda, and that TABOR's effects were uniquely pernicious.
"TABOR is so complete in its removal of core responsibilities for legislative bodies of the state," said Skaggs. "They are deprived of the authority they need to do their jobs and deal with public needs."
General Assembly in the wings
TABOR, which has resulted in nearly $3.5 billion of refunds to taxpayers in the first quarter-century after its passage and has been the subject of previous partial or total repeal efforts, was not the direct focus of the hearing. Instead, there were two prior cases within the 10th Circuit that dictated whether and when political subdivisions may sue their state governments.
In Branson School District RE-82 v. Romer, a panel of the 10th Circuit decided in 1998 that Colorado school districts were allowed to sue the state over the implementation of a constitutional amendment involving public school lands. More recently, in Hugo v. Nichols et al., the 10th Circuit clarified that the city of Hugo, Okla. could not sue the state's water resources board for an alleged constitutional violation. The attorney general's office believed the Hugo decision was appropriate for the TABOR case.
“Plaintiffs cannot show, as they must, that as a matter of law, when Congress passed the Enabling Act it granted any rights to Colorado’s school boards, boards of county commissioners or special district boards," Kotlarczyk said.
But because Hugo and Branson both originated from three-member panels, the 10th Circuit, by sitting en banc, is now free to decide which of those cases applies to the TABOR lawsuit — or if neither of them applies.
Even if the 10th Circuit were to decide local governments have no standing to sue, that still would not mean the end of the lawsuit. The Democratic-controlled General Assembly attempted to intervene as a plaintiff earlier this year. Although the 10th Circuit denied the request, the trial court judge could still allow the legislature to join.
“If the plaintiffs can’t state a claim, can the General Assembly?” asked Briscoe of the attorney general's office.
“Certainly the General Assembly is more properly positioned to bring a claim like this," conceded Kotlarczyk.
Judge Gregory A. Phillips also wondered whether a direct lawsuit by the legislature would be a more streamlined method of resolving the question of TABOR's constitutionality.
“If the General Assembly is indeed raring to go and you concede that it’s a more suitable party," Phillips said, "does the General Assembly get its day in court? Is this all just an exercise in delay?"
The case is Kerr v. Polis.