Ritter Property Tax Freeze Ruled Unconstitutional

Ritter tax freeze ruled unconstitutional
By John Ingold
The Denver Post
Article Last Updated: 05/30/2008 07:09:13 PM MDT

A Denver District Court judge ruled today that Gov. Bill Ritter's controversial mill-levy freeze is unconstitutional.

"However well-intentioned and commendable the purpose and consequences ... this Court must be concerned only with enforcement of the Colorado Constitution," District Court Court Judge Christina Habas wrote in her 15-page ruling. "While this Court candidly expresses its concern as to the resulting consequences of this decision, it must nonetheless perform its duties in a manner consistent with its oath to uphold the Constitution."

A group of taxpayers, organized by the conservative Independence Institute, filed suit late last year against the Colorado Department of Education, arguing that the property-tax freeze
Unconstitutional

* Read Judge Habas' 15-page ruling. (PDF)

amounts to an unconstitutional tax increase because voters did not directly approve it.

"All that's required to raise taxes in this state is to ask first. Only the most arrogant do it without asking," said Independence Institute President John Caldara, who learned of the ruling while attending a Republican Assembly in Westminster today.

Ritter's spokesman, Evan Dreyer, said the state will appeal the ruling to the state Supreme Court and also ask for a stay of the ruling, so that the state can continue to collect revenue from the mill levy freeze in the next fiscal year.

"It's not a surprise," Dreyer said. "We knew all along that this was going to be decided by the Supreme Court regardless of what happened at the district court level."

Dreyer said the state's appeal would come "fairly quickly."

The freeze holds mill levies - the rate at which taxes are charged - in place when they normally would fall, allowing local school districts to collect more tax money. The state, in return, can use the money it saves for other purposes.

Word of the decision that the freeze was unconstitutional quickly spread to GOP lawmakers via text message. They soon began exchanging high fives and handshakes in the Capitol hallways and at the Republican gathering in Broomfield.

Republicans tried unsuccessfully in the most recent legislative session to repeal the freeze, to refer it to voters and to set aside the money collected in the first year, an estimated $117 million, in the event the state lost the suit.

"That's huge. The governor's entire budget is built around this mill levy freeze," said Rep. Cory Gardener, R-Yuma.

"It's another huge loss for Bill Ritter," said Sen. Josh Penry, R-Grand Junction.

Ritter and his supporters have argued the freeze was constitutional under TABOR because it would only go into effect in the majority of the state's school districts that have already passed so-called "de-Brucing measures" to shed certain revenue limitations.

But Judge Habas found that argument unconvincing because she said none of the measures said that voting for them would result in an increase in property tax revenue collected.

"This Court concludes that the purpose of the TABOR voter approval requirements advising voters of potential changes in property tax revenue amounts were not met by those de-Brucing measures," Habas wrote.

Dreyer said the state is not coming up with contingency plans in the event it ultimately loses the lawsuit, and he said Ritter has no plans to set aside money.

"That's a bridge we are nowhere near," Dreyer said.

Ritter intended the money from the freeze to go into the state education fund to help at-risk kids attend preschool and full-day kindergarten.


http://www.denverpost.com/breakingnews/ci_9430933