Water district subject to TABOR vote requirement
- By CHARLES ASHBY Charles.Ashby@gjsentinel.com
- Mar 22, 2024
Water districts are like all other government entities that are subject to the Taxpayer’s Bill of Rights when it comes to voters approving tax increases, the Colorado Appeals Court ruled Thursday.
In a precedent-setting case out of Logan County in the northeast corner of the state, a three-judge panel overturned a lower court’s decision that the Lower South Platte Water Conservancy District that serves four Eastern Plains counties violated TABOR by doubling its mill levy starting in 2019 because it did so without voter approval.
The lower court had ruled in favor of the district, saying its raising of the levy from 0.5 mills to 1 mill did not violate that 1992 constitutional amendment because the water district was formed before TABOR was approved, and is required under the state’s Water Conservancy Act to set a mill levy based on a mandatory and non-discretionary formula.
The water district tried to argue that the Colorado Supreme Court, in Huber v. Colorado Mining Association, allows such mill levy increases because of that formula.
But a three-judge panel said that high court ruling applies to entities that aren’t making a legislative or governmental act for a tax-rate increase, but a non-discretionary duty under pre-TABOR taxing statutes, such as the Colorado Department of Revenue making legally required adjustments to severance taxes.
“The Supreme Court recognized that such a ‘ministerial, non-discretionary implementation of a tax law passed in the exercise of legislative authority’ prior to TABOR’s effective date did not ‘require voter approval, even if such implementation occurred after TABOR’s effective date,’” Judge Robert Hawthorne wrote in the Thursday ruling, which was joined by Judges Neeti Pawar and Daniel Taubman.
“Under the act, water conservancy districts are ‘political subdivisions of the state of Colorado,’” Hawthorne added. “A water conservancy district also has the power to fix a rate of levy. (The law) provides that a water conservancy district may increase a mill levy, ‘but any such increase … shall be made in accordance with the election procedure.’”
Mesa County Assessor Brent Goff said his office routinely monitors any increase in mill levies.
“We scrutinize all of the incoming mill levies during the December recertification process,” Goff said. “If any entity increases their mill levy, we contact them and look for a vote of the people within the district.”
In 2020, the Colorado River District went to voters for a ballot measure to increase property taxes for its day-to-day operations, and to fund community water projects. Since then, it has provided nearly $14 million to more than 100 such projects, money that was leveraged with federal funds to the tune of more than $66 million.
That ballot measure was resoundingly approved by voters in the 15 counties in the district.
Something similar happened to the Grand Valley Drainage District in 2018 when a Mesa County district judge ruled that a stormwater fee it had assessed was actually a tax, and needed voter approval. By then, the district had collected about $6.8 million from the fee, and spent several years paying it back, with interest.
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