City of Durango v. Durango Transp., Inc., No. 89SC487

• Docket Nº: No. 89SC487
• Citation: 807 P.2d 1152
• Case Date: March 25, 1991
• Court: Supreme Court of Colorado

Page 1152

807 P.2d 1152 CITY OF DURANGO; Board of County Commissioners of the
County of La Plata; and Durango Transit Advisory
Board, Petitioners,
v.
DURANGO TRANSPORTATION, INC., Respondent. No. 89SC487. Supreme Court of Colorado,
En Banc. March 25, 1991.

Smith & West, David P. Smith, Durango, for petitioners.

Law Office of Nancy P. Bigbee, Nancy P. Bigbee, Denver, for respondent.

Geoffrey Wilson, Denver, for amicus curiae Colorado Mun. League.

Marion A. Brewer, Denver, for amicus curiae Colorado Counties, Inc.

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Gorsuch, Kirgis, Campbell, Walker and Grover, Gerald E. Dahl, Denver, for amicus curiae Roaring Fork Transit Agency.

John R. Kennedy, Rolf G. Asphaug, Denver, for amicus curiae Regional Transp. Dist.

Justice LOHR delivered the Opinion of the Court.

We granted certiorari to review a judgment of the Colorado Court of Appeals holding that counties are not exempt from the jurisdiction of the Public Utilities Commission when operating mass transportation systems within county boundaries. See Durango Transp., Inc. v. City of Durango, 786 P.2d 428 (Colo.App.1989). We reverse and remand with directions.

I.

This case arose out of the efforts of the City of Durango (City) to obtain the authority to operate a mass transit service between Durango and the La Plata County Airport, and between Durango and the Purgatory Ski Area. The City is located in La Plata County.

Durango Transportation, Inc. (DTI), a private corporation, holds a certificate of public convenience and necessity issued by the Public Utilities Commission (PUC). The certificate allows DTI to provide mass transit service within La Plata County, including the routes sought by the City. In 1983 DTI agreed to sell a portion of its PUC certificate authority for operation of mass transportation in La Plata County to the City. Specifically, the City agreed to purchase certification for the routes between Durango and the La Plata County Airport, and between Durango and the Purgatory Ski Area. The contract, dated August 9, 1983, also granted the City a three-year option to acquire the balance of DTI's permit authority for La Plata County. In a letter dated September 14, 1984, the City sought to exercise that option. DTI responded by a letter from its attorney dated October 31, 1984, refusing to sell its PUC authority for the additional routes. ¹ On November 8, 1984, the City notified DTI that it considered the October 31 letter to be an "unequivocal repudiation" of the August 1983 contract and that consequently the City Council had voted to rescind the agreement.

The City then sought an alternative means of obtaining authorization for the transportation service. On November 21, 1984, the City and the County entered an intergovernmental agreement (IGA) to provide mass transit in La Plata County. As modified on August 29, 1985, the IGA provided for operation and maintenance of the mass transit system by the City. The City is to establish fares with advice and recommendation by the Transit Advisory Board, made up of both City and County appointees.

DTI filed a complaint with the PUC against the City and the county for operating a mass transit service without PUC authority. On September 20, 1985, the PUC dismissed the complaint against the County and that portion against the City pertaining to operation of the service within city boundaries, for lack of jurisdiction. The PUC denied the motion to dismiss the complaint against the City for operation of the service outside the city boundaries. ² On December 13, 1985, DTI filed suit against the City, the County and the Durango Transit Advisory Board in the District Court of La Plata County. It is this suit that resulted in the judgment of the court of appeals now before us on review.

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In the district court action, DTI sought an injunction against the City, the County, and the Durango Transit Advisory Board to prevent operation of the mass transit service in La Plata County outside the city limits of Durango without authorization by the PUC. DTI also sought damages from all the defendants for infringement of rights held by DTI under its certificate of public convenience and necessity. Finally, DTI sought damages from the City for alleged breach of the August 1983 contract between the City and DTI whereby the City agreed to purchase DTI's PUC authority to operate certain routes in La Plata County. The City counterclaimed against DTI for restitution of payments made on the contract prior to the alleged repudiation and anticipatory breach of the contract by DTI.

After a bench trial, the district court dismissed the complaint filed by DTI, finding that the City and County had statutory authority to enter the IGA and that operation of the service is not subject to PUC jurisdiction. ³ The court of appeals reversed the trial court's judgment dismissing DTI's complaint and remanded for further findings on whether DTI should be granted an injunction and damages. The court of appeals concluded that operation of a mass transportation system by a county is subject to PUC jurisdiction. Thus, the court of appeals held that operation of mass transit by the City and the County within the county but outside the city limits pursuant to a joint agreement is subject to PUC jurisdiction.

We granted certiorari to review the holding of the court of appeals that operation of a mass transportation system by a county within its boundaries is subject to PUC jurisdiction. We reverse and remand for further proceedings consistent with this opinion. ⁴

II.

The Colorado Constitution prohibits the General Assembly from "delegat[ing] to any special commission ... any power to make, supervise or interfere with any municipal improvement, money, property or effects ... or perform any municipal function whatever." Colo. Const. art. V, § 35. We have long recognized that the State Board of Public Utilities formed to regulate public utilities (now the Public Utilities Commission) is a special commission for the purposes of article V, section 35. Town of Holyoke v. Smith, 75 Colo. 286, 294, 226 P. 158, 161 (1924); accord Board of County Comm'rs of Arapahoe v. Denver Bd. of Water Comm'rs, 718 P.2d 235, 244 (Colo.1986); Loveland v. PUC, 195 Colo. 298, 301, 580 P.2d 381, 383 (1978); City of Lamar v. Town of Wiley, 80 Colo. 18, 21, 248 P. 1009, 1010 (1926); People ex rel. Utilities Comm'n v. Loveland, 76 Colo. 188, 190, 230 P. 399, 400 (1924). We held, therefore, that article V, section 35, prohibits PUC regulation of public utilities owned and operated by a city within the boundaries of that city. Holyoke, 75 Colo. at 298, 226 P. at 162; accord Board of County Comm'rs, 718 P.2d at 244; Loveland, 195 Colo. at 301, 580 P.2d at 383; Lamar, 80 Colo. at 21, 248 P. at 1010; Utilities Comm'n, 76 Colo. at 190, 230 P. at 400.

In 1954 the Colorado Constitution was amended by adoption of article XXV, which provides:

In addition to the powers now vested in the General Assembly of the State of Colorado, all power to regulate the facilities, service and rates and charges therefor, including facilities and service and

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rates and charges therefor within home rule cities and home rule towns, of every corporation, individual, or association of individuals, wheresoever situate or operating within the State of Colorado, whether within or without a home rule city or home rule town, as a public utility, as presently or as may hereafter be defined as a public utility by the laws of the State of Colorado, is hereby vested in such agency of the State of Colorado as the General Assembly shall by law designate.

Until such time as the General Assembly may otherwise designate, said authority shall be vested in the Public Utilities Commission of the State of Colorado; provided however, nothing herein shall affect the power of municipalities to exercise reasonable police and licensing powers, nor their power to grant franchises; and provided, further, that nothing herein shall be construed to apply to municipally owned utilities.

Colo. Const. art. XXV. We have held that the purpose of article XXV "was to grant to the General Assembly the authority to regulate privately owned public utilities within home rule cities," authority previously reserved to home rule cities as a "local matter." Denver v. PUC, 181 Colo. 38, 43-44, 507 P.2d 871, 873 (1973) (emphasis in original); accord Union Rural Electric Ass'n, Inc. v. Town of Frederick, 670 P.2d 4, 7 (Colo.1983); Craig v. PUC, 656 P.2d 1313, 1316 (Colo.1983).

In the present case, the court of appeals held that article XXV grants broad authority to the PUC including jurisdiction to regulate a public utility owned and operated by a county. Durango Transp., Inc., 786 P.2d at 431-32. The City, County and amici assert that the County is exempt from regulation by the PUC under both article V, section 35, and article XXV. To resolve this issue we must determine, first, whether a county falls within the exemption from regulation expressed in article V, section 35, and interpreted in Holyoke, and second, whether the addition of article XXV to the Colorado Constitution altered the scope of PUC regulatory authority with respect to a county.

A.

In determining the application of article V, section 35, to a county we look first to the language of the provision itself. Colorado State Civil Service Employees Ass'n v. Love, 167 Colo. 436, 445, 448 P.2d 624, 628 (1968). "Where the language of the Constitution is plain and its meaning clear, that language must be declared and enforced as written." Colorado Ass'n of Public Employees v. Lamm, 677 P.2d 1350, 1353 (Colo.1984); accord People ex rel. Park Reservoir Co. v. Hinderlider, 98 Colo. 505, 507, 57 P.2d 894, 895 (1936).

Article V, section 35, prohibits PUC regulation of "any municipal improvement, money, property or effects" and PUC performance of "any municipal function." (Emphasis added.) The Colorado Constitution does not define "municipal."

The...