Rowland, officials differ over county move on TABOR

By Duffy Hayes

Saturday, May 4, 2013

In May 2007, Mesa County took the unprecedented step of deciding — without voter approval — to exclude its local sales taxes from revenue limit calculations set forth in the Taxpayer’s Bill of Rights.

Six years later, current and former county staff say the county did so with unanimous consent of the three county commissioners.

One of those commissioners, though, vehemently denies that she ever signed off on the plan, or that she participated in the meeting where, the current and former officials say, the decision was made.

“I never participated in a meeting where this was discussed. I was never asked to support such a scheme and I never gave my approval to implement it,” former Commissioner Janet Rowland wrote in an email to The Daily Sentinel.

“I never would have gone for that — ever,” she said in a subsequent interview.

Then-County Administrator Jon Peacock says she did. So, too, does county Finance Director Marcia Arnhold, as does current Commissioner Steve Acquafresca, who was one of the three commissioners said to have given unanimous consent to the change.

All three refer to a May 2007 meeting in which Peacock, Arnhold and, according to them and Acquafresca, all three commissioners discussed the possible change, with attorney Dee Wisor on the phone from Denver. Wisor was solicited for a legal opinion about the possibility of excluding sales taxes and provided a case for the change based on the fact that Mesa County voters had approved their sales tax in 1981, well before voters statewide approved TABOR.

“I remember that we gave direction. And it was unanimous amongst all three,” Acquafresca said recently.

“We met for 45 minutes to an hour, was my recollection. And there were a lot of questions — a lot of back and forth,” recalled Peacock, now the Pitkin County manager.

“I do know that we wanted to make sure that everyone was comfortable with the decision before we moved forward, and that we had that consent,” he said.

In an interview, Arnhold recalled a meeting and unanimous consent from the board to make the change, but her recollection was slightly inconsistent with other accounts. She said the meeting was held in Peacock’s office and that County Attorney Lyle Dechant was in attendance. Peacock said the meeting in question was held in a conference room and Dechant was not there.

“The reason I’m having a hard time figuring out where it happened is, it didn’t happen,” Rowland said.

Rowland said the first she heard of the sales tax exclusion was by reading a previous article in The Daily Sentinel.

Further, in an email, she wrote, “I did not participate in a briefing and then on a whim agree to just eliminate over half of our revenue from TABOR because of some alleged, unsigned and undated legal opinion,” in reference to the advice formally given to the county by Wisor in a May 17, 2007, letter.

She instead charges Peacock with scheming to gain board approval for the change.

“This was the beginning of our third year, and I hadn’t quite learned yet the song and dance that Jon would frequently do, and the way he would play us,” Rowland said.

“I could see us having a meeting, a long afternoon of meetings, and at the very end he or Marcia saying something like, ‘We think we might be calculating our TABOR wrong, with the sales tax, and we’re going to look into that. Are you OK with that?’” she posited.

In another email, she wrote: “This is just one of the many things that Jon Peacock did without our knowledge. Unfortunately he was already gone by the time we learned of them … otherwise I can assure you this is one commissioner who would have voted to fire him.”

Back in 2006 and 2007, the county was registering record revenue and surely would have surpassed the limits set by TABOR that would have triggered a sizable refund to taxpayers.

Arnhold said Peacock back then “challenged us” to reassess their strategy toward TABOR.

During that board’s tenure, in addition to sales taxes being excluded, county commissioners also gained a TABOR exemption by creating an “enterprise” with the county’s building services department and utilized certificates of participation — which were upheld by Colorado courts — as instruments to raise money for capital projects.

“While some may not have agreed with the decision” to do both of those things, Rowland wrote, “(they) were done in broad daylight in a public hearing.”

As for the third member of the commission, Craig Meis, he could not confirm either account, saying, “It certainly is not something that sticks in my memory banks at all — about a specific meeting.”

Even if the decision to exclude sales tax revenue did indeed happen at the May 2007 meeting, a question can be raised about whether that constituted “formal action” by the board.

Colorado’s Open Meetings Law requires minutes of meetings to be kept when “formal action does or could occur.” The Daily Sentinel is not aware of any minutes recorded at — much less the specific date of — the meeting in question.

Peacock characterized the meeting as a “workshop,” which is exempt from the minutes requirement. Both he and Acquafresca have called the exclusion decision “administrative direction” to county staff, rather than a formal action or shift in policy.

The change in approach to the county’s TABOR calculations — which the county says began with the financials for 2006, when more than $27.7 million was collected in sales tax revenue — may be crossways with TABOR itself.

The constitutional amendment explicitly states that an election is required and districts must have voter approval in advance for “a tax policy change directly causing a net tax revenue gain to any district.”

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