Colorado fights off challenge to ‘Taxpayer’s Bill of Rights’

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Brad Jones Contributor
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A court is weighing whether Colorado lawmakers should have more power to raise taxes.

A challenge to Colorado’s constitutional limits on spending and taxation was in federal court this week, with plaintiffs arguing the “Taxpayer’s Bill of Rights” encroaches on the legislature’s ability to raise taxes on its own.

The lawsuit, filed in 2011, pits a host of former state lawmakers and high-profile attorneys against a 1992 amendment to the state constitution which limits spending — even requiring refunds to taxpayers in cases of surplus — and also requires public votes on tax increases. It’s the latter requirement that has some lawmakers crying foul that TABOR “arrogates” their power to tax.

“Without the power to tax there is no effective government,” argued plaintiffs’ attorney David Skaggs at a hearing Monday, according to the Associated Press.

While some lawsuits argue nuanced legal theories, TABOR foes go for the constitutional jugular: the U.S. Constitution guarantees states a “republican” form of government, and TABOR’s referendum requirement tips the scale too far toward direct democracy.

“Frustration with the work of legislatures, whether federal or state, may indicate a need for representative institutions to be more effective, but that frustration does not justify or permit resorting to direct democracy,” reads the lawsuit.

Colorado’s constitution, relatively easy to amend compared to other states with an initiative process, pits TABOR against competing clauses governing property tax rates and education spending.

“Since the passage of TABOR in 1992, the State of Colorado has experienced a slow, inexorable slide into fiscal dysfunction,” the plaintiffs argue.

Defending the law is Colorado governor John Hickenlooper, with representation from Republican attorney general John Suthers.

The state previously attempted to block the lawsuit based on a lack of standing; in late 2012 U.S. District Court Judge William Martinez ruled in favor of the plaintiffs. Monday’s hearing marks a second attempt at squelching their claim, as Suthers argued the federal courts lack jurisdiction.

“Plaintiffs make clear that this case is an effort to have the courts remove what they see as an obstacle to their policy agenda: direct citizen participation in lawmaking,” reads the state’s brief.

“They deserve credit for acknowledging that, while their policy preferences lead them to focus their ire on one particular instance of direct democratic participation in Colorado, the Taxpayers’ Bill of Rights, their arguments ultimately would require the Court to hold unconstitutional all forms of direct citizen lawmaking.”

The latter passage could be seen as a reference to the political left’s frequent usage of the referendum process to further their own goals, including an initiative before Colorado voters this fall raising taxes in the name of K-12 education. The tax increase follows the sunset of most of Amendment 23, passed by voters in 2000 which mandated spending on education while TABOR simultaneously constrained budget growth. The conflict has fueled a renewed debate over TABOR’s efficacy.

The initiative process in Colorado is popular on both sides of the political aisle, however repeated efforts to tighten signature requirements and disincentivize constitutional amendments (versus statutory initiatives) have failed in the legislature and at the ballot box.

The vast majority of plaintiffs in the case are Democrats, joined by at least one Republican, former state Sen. Norma Anderson. All currently-seated state Republican lawmakers oppose the lawsuit.

A ruling on the state’s motion to dismiss is not expected for several months.

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