Posts Tagged TABOR

The US Supreme Court’s Proposition 8 Ruling, and TABOR

Today, in its ruling on California’s Proposition 8, the Supreme Court ruled that citizens’ groups do not have standing to defend a law passed by referendum or initiative in federal court, should the state decline to do so.  By making this reasoning the basis for its decision, the Court has potentially invited grave implications for Colorado and its Taxpayers Bill of Rights.

Currently, TABOR is the subject of a lawsuit arguing that it violates the US Constitution’s provisions that each state have a republican form of government:

The United States shall guarantee to every State in this Union a Republican Form of Government, and shall protect each of them against Invasion; and on Application of the Legislature, or of the Executive (when the Legislature cannot be convened), against domestic Violence.


The plaintiffs, which include five current Democratic state legislators, argue that, by removing the legislature’s ability to raise taxes without approval by the people, has violated that clause.  That case is now in federal court, in front of the 10th Circuit Court of Appeals.

That assertion has been challenged on a number of counts.  First, the federal courts have ruled that clause – the “Guarantee Clause” to be non-justiciable, leaving it instead as an issue for the political branches.  Second, there is every reason to believe that the founders used the word “republican” to describe even systems of direct democracy.

Currently, with Gov. Hickenlooper named as respondent on behalf of the state, Colorado’s Attorney General, John Suthers, is defending TABOR on behalf of the state.

In the case today regarding Proposition 8, Hollingsworth v. Perry, the State had declined to defend Proposition 8 in court, despite its having been an approved referendum, and being the law of the State of California.  The Supreme Court ruled that, in the absence of state defense, private citizens groups cannot do so in its stead.  Once the state agrees with the plaintiffs, the court was essentially saying, there is no case.

The implications for Colorado’s TABOR case, and next year’s elections to succeed Suthers as Attorney General, are profound.  While any or all of the Republican candidates can be expected to defend TABOR vigorously, the election of a Democrat would open the possibility that the Colorado Department of Law might decline to defend TABOR in federal court.

In the case involving the Defense of Marriage Act, the federal Department of Justice declined to defend DOMA in court, but the US House of Representative hired counsel to do so.  If the Democrats were to retain control of both houses of the state legislature, it is highly unlikely that they would act to defend TABOR in this way.

If that were to happen, TABOR might be left without defense, and without any party with standing to conduct a defense.  In short, a twenty-year-old state Constitutional Amendment, whose basic provisions have never been overridden on subsequent attempts at repeal or modification, could be killed by default.

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Amazon Tax Bites The Dust

In 2010, the Democrats in Colorado, in violation of the state Taxpayers Bill of Rights, passed a variety of tax increases known as the Dirty Dozen.  The state’s highly politicized Supreme Court gave the tax increases a pass around TABOR’s requirement for a citizen vote, but the federal courts are frequently a different matter, and so it has proved with one of the measures, the so-called, “Amazon Tax.”  That tax applied the state sales tax to sales by Amazon affiliates in the state, on the dubious proposition that the presence of a person who either owns a website (which could be hosted anywhere in the world) or who sells web ads constitutes a significant physical presence in the state.

Now, a federal court has decided that the tax violates the US Constitution:

On Friday, the federal court in Denver declared the 2.9 percent tax on purchases unconstitutional on the ground it was tilted unfairly against out-of-state retailers, and that it put an undue burden on retailers to either collect the tax owed by consumers or report consumer purchases to the state.

Judge Robert Blackburn’s ruling noted the legal language of the tax didn’t distinguish between in-state and out-of-state businesses, but the practical effect of the tax did.

“I conclude that the veil provided by the words … is too thin to support the conclusion that the Act and the Regulations regulate in-state and out-of-state retailers even-handedly,” Blackburn wrote.

The court applied what is known as the “negative Commerce Clause,” the notion that if regulation of interstate commerce is explicitly delegated to the Federal government, then it cannot be exercised by state governments.  As Ramesh Ponnuru says in his review of Michael Greve’s The Upside-Down Constitution

Chief among the Court’s stratagems was its deployment of what has come to be known as the “dormant” or “negative” commerce clause: the inference that since the Constitution vests Congress with the power to regulate commerce among the states, it denies that power to states. That inference has long been controversial, not least among originalists, but Greve points out that without it the states would have at hand a ready means to circumvent the specific prohibitions on them that the Constitution spells out.

Ponnuru also notes that, “Several provisions of the Constitution block state governments from taxing economic activity outside their borders.”  Greve makes the case that since the 30s, courts have increasingly presumed that states can regulation out-of-state commerce, rather than placing the burden of proof on the states.  Today’s ruling is a small step back in the other direction.

Now, it remains to be seen if Amazon will restore its Colorado affiliates.

UPDATE: On the likelihood of an appeal, someone involved in the fight against the original measure comments:

The judge ruled that the state had violated the US constitution in two seperate and distinct ways- by violating the dormant commerce clause in discriminating against out of state retailers, and in imposing an undue burden on out of state retailers with the reporting requirements in the bill. Highly unlikely the state would appeal, as they would have to overcome both violations.

Attorney General John Suthers declined to defend the State on this case (which is his prerogative) and the Department of Revenue had to hire their own legal counsel. As such, it would have to be the Governor/ED of the Dept of Revenue that would decide to appeal. Hickenlooper was almost convinced last year to support the repeal bill after the judge had granted a temporary injunction. That failed when the State Senate killed off a bunch of Republican bills in the last few days of the session. Just don’t see Hick taking up this fight – remember this all happened under former Governor Bill Ritter, mainly as a ploy to raise a few dollars to ballance the budget. With the preliminary injunction, the state has never collected a dime on this law. The permanent injunction doesnt mean the state will lose any revenue they counted on-they just simply won’t be able to gain revenue they didnt plan on.

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Be Careful What You Wish For

Back in 2009, the Colorado legislature decided they had had it with citizen oversight.  They passed HB09-1326, which, among other things:

  • People who successfully challenge the validity of signatures in court could sue sponsors of the measure to recover attorney’s fee.
  • Circulators who collect more than 100 signatures are required to go through a government-sponsored training procedure before they are allowed to collect additional signatures legally

Most damagingly, people can sue for attorneys’ fees even if they don’t invalidate enough signatures to get the measure disqualified, and they can hold sponsors of the initiative personally liable for these damages.  Jon Caldara, the victim of such a lawsuit, has argued that these rules, and the risk they entail, constitute such a high bar to participation in the process that they effectively kill it.

Comes “Great Education Colorado Action is the political arm of Great Education Colorado, a group that urges more spending on education,”  (gee, I wonder where their funding comes from?), and a ballot measure to “temporarily” raise state sales and income taxes to pay for education.  (For the moment, let’s skip over the merits of the measure, except to note that money is fungible, and anyone who thinks this money is going to make it to the classroom without taking a detour through teachers unions and pension funds will also probably be surprised by the headlines, immediately upon ratification, that claim that the schools are still short of cash.)

Their innovation here isn’t the proposal, that’s old hat.  Their innovation is in how they propose to gather signatures:

So supporters are trying a strategy that uses social network websites to ask people to sign the petitions. Supporters have set up a website that allows people to download petitions and then volunteer to gather signatures.

The kit includes instructions on how to gather 50 signatures to fill each petition and even how to properly staple the pages. It instructs volunteers to seek out a notary after gathering the signatures and then to return the signed petitions to supporters in Denver.Every petition must bear an individual number, and the website where they can be downloaded assigns each one a unique number.

Some see this as a highly creative way to gather signatures on the cheap.  I see it as a way to limit the teachers unions’ liability, while still exposing them to real risks.  The circulators are under even less control than usual, will be prone to making mistakes, and all the liability for the costs involved in hunting in this target-rich environment will fall to GEC.  Moreover, there’s no way of stopping individuals from collecting more than 100 signatures.  In fact, there will be considerable incentive for person A to gather, say, 150 signatures, and have persons B and C sign for 50 each, which is, of course, fraudulent.

Great Education Colorado may think it’s got a really cool idea here.  I hope someone’s willing to hold them to the same inane standards that the left has tried to foist on the rest of us.

Also, just to add to the schdenfreude, note that suddenly, to the Denver Post, which has spent years agitating against the initiative process, “The hurdle to get an initiative on the ballot isn’t small.”  Keep that in mind the next time they editorialize about how easy the initiative process is.  Apparently, small is in the eye of the petitioner.


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Contempt of Constituents

Looking at the events of the last couple of weeks, it’s difficult to escape the conclusion that certain public officials in Colorado hold their constituents in contempt for the sin of not handing over their pocketbooks.

Legislative Democrats, with the cooperation of too many Republicans, have gone along with efforts to water down the state’s initiative process.  And now, for refusing to go along with these plans, the people having spoken, must be punished.

In 2008, they turned down Referendum O, which would have allowed opponents of ballot measures to focus their efforts on any one Congressional district.  And they turned down Amendment 59, which would have lined the teachers unions’ pension plans by gutting TABOR.

This session, the Democrats failed to pass out of the Senate SCR-001, which would have created a hybrid Constitutional amendment-recision process that was clearly too complex for its stated goals.

Now, they have resorted to suing their own constituents in federal court, claiming that the Colorado Constitution is unconstitutional.  The legal precedent here is clear.  The courts have long held that the US Constitutional requirement for a “republican form of government” is non-justiciable, meaning that it’s a matter for the legislature and the people to decide.  The most recent case, in 1912, upheld a state’s citizen initiative process against the very claim they seek to revive.

Remember, for “progressives,” it’s always Three Minutes to Wilson.

This effort is really a matter of politics, not of litigation, and that the plaintiffs are seeking a platform at taxpayers’ expense to make their case against TABOR.

(Let’s be clear: this is a Democrat initiative, and shame to the few officeholding Republicans who’ve given them cover to call it “bipartisan.”  The big names are representatives of the “former” variety, and of the total list of 12, only 6 hold elected office, at the school board or city council level, most of which are nominally non-partisan.)

We’ve also heard that back in 2009-2010, the Colorado Springs City Manager at the time, Penny Culbreth-Graft, had instructed the city’s PR office to intentionally undermine its image, in the national media if need be, to browbeat the citizenry into voting for higher taxes.  I’m sure the folks tasked with luring tourists, students, and businesses to the area were thrilled with this.

So think about this: in the last two weeks, we’ve seen public officials sue their citizens, and undermine the name of their own city.  Why on earth should these people be trusted with more of our money?

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