Aurora Urban Renewal Auth. v. Kaiser

• Decision Date: 06 January 2022
• Docket Number: Court of Appeals No. 20CA1162
• Parties: AURORA URBAN RENEWAL AUTHORITY, Corporex Colorado LLC, Fitzsimons Village Metropolitan District No. 1, Fitzsimons Village Metropolitan District No. 2, and Fitzsimons Village Metropolitan District No. 3, Plaintiffs-Appellants, v. PK KAISER, in his official capacity as Arapahoe County Assessor; and JoAnn Groff, in her official capacity as Colorado State Property Tax Administrator, Defendants-Appellees.
• Court: Colorado Court of Appeals

507 P.3d 1033

2022 COA 5

AURORA URBAN RENEWAL AUTHORITY, Corporex Colorado LLC, Fitzsimons Village Metropolitan District No. 1, Fitzsimons Village Metropolitan District No. 2, and Fitzsimons Village Metropolitan District No. 3, Plaintiffs-Appellants,

v.PK KAISER, in his official capacity as Arapahoe County Assessor; and JoAnn Groff, in her official capacity as Colorado State Property Tax Administrator, Defendants-Appellees.

Court of Appeals No. 20CA1162

Colorado Court of Appeals, Division II.

Announced January 6, 2022

Kutak Rock LLP, Daniel C. Lynch, Thomas W. Snyder, Thomas A. Isler, Denver, Colorado; Daniel L. Brotzman, City Attorney, Christine McKenney, Senior Assistant City Attorney, Aurora, Colorado, for Plaintiff-Appellant Aurora Urban Renewal Authority

Fairfield and Woods P.C., Craig D. Joyce, Lee Katherine Goldstein, Denver, Colorado, for Plaintiffs-Appellants Corporex Colorado LLC, Fitzsimons Village Metropolitan District No. 1, Fitzsimons Village Metropolitan District No. 2, and Fitzsimons Village Metropolitan District No. 3

Ronald A. Carl, County Attorney, John R. Christofferson, Deputy County Attorney, Benjamin P. Swartzendruber, Senior Assistant County Attorney, Littleton, Colorado, for Defendant-Appellee PK Kaiser

Philip J. Weiser, Attorney General, Robert H. Dodd, First Assistant Attorney General, John H. Ridge, Assistant Attorney General, Jessica E. Ross, Assistant Attorney General, Denver, Colorado, for Defendant-Appellee JoAnn Groff

Brownstein Hyatt Farber Schreck, LLP, Carolynne C. White, Christopher O. Murray, Angela J. Hygh, Denver, Colorado, for Amici Curiae Downtown Colorado, Inc., Colorado Municipal Bond Dealers’ Association, and National Association for Industrial and Office Parks

David W. Broadwell, Laurel Witt, Denver, Colorado, for Amicus Curiae Colorado Municipal League

Hall & Evans, L.L.C., Andrew D. Ringel, Denver, Colorado, for Amicus Curiae Colorado Counties, Inc.

Opinion by JUDGE BERGER

¶ 1 This case addresses the financing of urban renewal projects under Colorado's Urban Renewal Law (URL), sections 31-25-101 to - 116, C.R.S. 2021, and, more specifically, the intricacies of Tax Increment Financing (TIF), which is central to the viability of urban renewal projects.

¶ 2 Plaintiff Aurora Urban Renewal Authority appeals the district court's judgment in favor of defendants, the Arapahoe County Assessor (Assessor) and the Colorado Property Tax Administrator (Administrator). Plaintiffs Fitzsimons Village Metropolitan District No. 1, Fitzsimons Village Metropolitan District No. 2, and Fitzsimons Village Metropolitan District No. 3 (collectively, Metro Districts) and Corporex Colorado LLC (Corporex) appeal the district court's judgment dismissing them for lack of standing. We conclude that all of the plaintiffs have standing and that, in one respect, the rules promulgated by the Administrator that govern the assessment of properties in an urban renewal area are contrary to law.

I. Relevant Facts and Procedural History

¶ 3 The URL authorizes the creation of urban renewal authorities like the Aurora Urban Renewal Authority to undertake urban renewal projects aimed at redeveloping slum and blighted areas. §§ 31-25-104, - 105(1)(b), (1)(i)(I), C.R.S. 2021. To fund these projects, the URL authorizes the use of TIF. § 31-25-107(9)(a), C.R.S. 2021.

¶ 4 "TIF uses recently assessed property values in an urban renewal area to establish a base tax value." City of Aurora v. Scott , 2017 COA 24, ¶ 2, 410 P.3d 720 ; § 31-25-107(9)(a)(I). "As property values increase above the base value, increased tax revenues are allocated to the financing of the renewal project. Those revenues are applied to the renewal fund and used to pay down the debt against the project." Scott , ¶ 2 ; § 31-25-107(9)(a)(II).

[T]he property is reassessed in subsequent years for tax purposes in the hopes that the urban renewal plan has increased its value. After all levies are assessed and collected on the subsequent valuation, any incremental increase in the base amount is deemed the result of the urban redevelopment efforts by the municipality and is distributed to the urban renewal authority.

E. Grand Cnty. Sch. Dist. No. 2 v. Town of Winter Park , 739 P.2d 862, 864 (Colo. App. 1987) ; accord Northglenn Urb. Renewal Auth. v. Reyes , 2013 COA 24, ¶ 3, 300 P.3d 984.

¶ 5 The statute does not specify precisely how county assessors should calculate base and increment values. Instead, the statute delegates that authority to the Administrator: "The manner and methods by which the requirements of this subsection (9) are to be implemented by county assessors shall be contained in such manuals, appraisal procedures, and instructions, as applicable, that the property tax administrator is authorized to prepare and publish pursuant to section 39-2-109(1)(e), C.R.S. [2021]." § 31-25-107(9)(h).

¶ 6 The Administrator's manuals are titled the Assessors’ Reference Library (Reference Library). See 2 Div. of Prop. Tax'n, Dep't of Loc. Affs., Assessors’ Reference Library § 12, at 12.1-12.36 (rev. Oct. 2021).

¶ 7 The URL also provides that

[i]n the event there is a general reassessment of taxable property valuations in any county including all or part of the urban renewal area subject to division of valuation for assessment under paragraph (a) of this subsection (9) or a change in the sales tax percentage levied in any municipality including all or part of the urban renewal area subject to division of sales taxes under paragraph (a) of this subsection (9), the portions of valuations for assessment or sales taxes under both subparagraphs (I) and (II) of said paragraph (a) shall be proportionately adjusted in accordance with such reassessment or change.

§ 31-25-107(9)(e).

¶ 8 The Aurora Urban Renewal Authority, Corporex, and the Metro Districts sued the Assessor and Administrator, alleging that the Reference Library's apportionment methodology violates the URL. They sought both declaratory and injunctive relief.

¶ 9 The Assessor and Administrator filed comprehensive motions to dismiss, challenging both standing and the merits of the plaintiffs’ claims. The district court resolved the motions to dismiss, ruling as follows:

• the Metro Districts and Corporex lack constitutional standing;

• the Aurora Urban Renewal Authority and the Metro Districts lack prudential standing to sue the Administrator;

• plaintiffs’ claims survived defendants’ contention that they are barred for failure to exhaust administrative remedies; and

• the district court had no authority to grant injunctive relief against the Administrator or the Assessor.

¶ 10 Then, on cross-motions for summary judgment regarding the remaining claims between the Aurora Urban Renewal Authority and the Assessor, the district court reached the merits and construed the statutory term "general reassessment" to include the statutory biennial reassessment of real property and, accordingly, granted summary judgment in favor of the Assessor.

¶ 11 The Metro Districts and Corporex appeal the district court's standing determination. The Aurora Urban Renewal Authority appeals the district court's prudential standing determination (as to the Administrator) and the summary judgment on the merits in favor of the Assessor.

II. All of the Plaintiffs have Constitutional Standing

¶ 12 The Metro Districts and Corporex argue that the district court erred by dismissing them for lack of constitutional standing. We agree.

A. Standing Law

¶ 13 Standing is a question of law, which we review de novo.¹ Ainscough v. Owens , 90 P.3d 851, 854 (Colo. 2004).

¶ 14 Under Colorado law, a plaintiff must satisfy two prongs to establish standing. Id. at 855 ; Wimberly v. Ettenberg , 194 Colo. 163, 168, 570 P.2d 535, 539 (1977). "First, the plaintiff must have suffered an injury in fact, and second, that injury must be to a legally protected interest as contemplated by statutory or constitutional provisions." Bd. of Cnty. Comm'rs v. Colo. Oil & Gas Conservation Comm'n , 81 P.3d 1119, 1122 (Colo. App. 2003).

B. Injury in Fact

¶ 15 The doctrine of standing is not a meaningless hoop that we require plaintiffs to jump through. It embraces both constitutional and prudential considerations. City of Greenwood Village v. Petitioners for Proposed City of Centennial , 3 P.3d 427, 437 (Colo. 2000). The injury-in-fact prong ensures concrete adversity between the parties before the court so that the court's judgment does not devolve into an advisory opinion, which courts do not have jurisdiction to render. Id. ; Tippett v. Johnson , 742 P.2d 314, 315 (Colo. 1987). "This court is not empowered to give advisory opinions based on hypothetical fact situations." Tippett , 742 P.2d at 315.

¶ 16 The supreme court has also instructed that the injury cannot be the "remote possibility of a future injury nor an injury that is overly ‘indirect and incidental’ to the defendant's action." Ainscough , 90 P.3d at 856 (quoting Brotman v. E. Lake Creek Ranch, L.L.P. , 31 P.3d 886, 890-91 (Colo. 2001) ). However, "[i]n Colorado, parties to lawsuits benefit from a relatively broad definition of standing." Id. at 855.

¶ 17 Here, there is no real question about concrete adversity. The parties on the opposite sides of this case obviously are adverse to each other in a matter that has great importance to both them and the public at large. Nor is this a taxpayer standing case, which is governed, in part, by different requirements of standing. See TABOR Found. v. Colo. Dep't of Health Care Pol'y & Fin. , 2020 COA 156, ¶¶ 12-14, 487 P.3d 1277.

¶ 18 We also cannot ignore that the claims pleaded by the plaintiffs invoke the Uniform Declaratory Judgments Law, §§ 13-51-101 to - 115, C.R.S. 2021, a remedial statute that must be liberally construed and administered. § 13-51-102, C.R.S. 2021. The interplay between the doctrine of standing and the declaratory judgments law, at times, may be difficult to ascertain, but that is not the case here.

¶ 19 The defendants argue that the Metro Districts have alleged...