City of Golden v. Parker

• Decision Date: 26 June 2006
• Docket Number: No. 05SC282.,05SC282.
• Citation: 138 P.3d 285
• Parties: CITY OF GOLDEN, a Colorado municipal corporation; City Council of the City of Golden; Interplaza West Associates, LLP, a Colorado limited liability partnership; Sullivan Three Limited liability Company, a Colorado limited liability company; Kohl's Department Stores, Inc., a Delaware corporation; Home Depot U.S.A., Inc., a Delaware corporation; Christopher Hall Realty, LLC; Golden Properties, Ltd., a Colorado corporation; GEI-H, LLC, a Colorado limited liability company; GEI-6, LLC, a Colorado limited liability company; Coors Technology Center Owners Association, a Colorado nonprofit corporation; Coors Ceramics Company, Inc., a Colorado corporation; Coors Porcelain Company, a Colorado corporation; Bounce, Inc., a Colorado corporation; Graphic Packaging Corporation of Colorado, Inc., a Colorado corporation; Dada Development, Inc., a Colorado corporation; 16200 Table Mountain Parkway Investors, LLC, a Delaware corporation; and Coors Brewing Co., a Colorado corporation, Petitioners v. Donald G. PARKER, Respondent.
• Court: Colorado Supreme Court

138 P.3d 285

CITY OF GOLDEN, a Colorado municipal corporation; City Council of the City of Golden; Interplaza West Associates, LLP, a Colorado limited liability partnership; Sullivan Three Limited liability Company, a Colorado limited liability company; Kohl's Department Stores, Inc., a Delaware corporation; Home Depot U.S.A., Inc., a Delaware corporation; Christopher Hall Realty, LLC; Golden Properties, Ltd., a Colorado corporation; GEI-H, LLC, a Colorado limited liability company; GEI-6, LLC, a Colorado limited liability company; Coors Technology Center Owners Association, a Colorado nonprofit corporation; Coors Ceramics Company, Inc., a Colorado corporation; Coors Porcelain Company, a Colorado corporation; Bounce, Inc., a Colorado corporation; Graphic Packaging Corporation of Colorado, Inc., a Colorado corporation; Dada Development, Inc., a Colorado corporation; 16200 Table Mountain Parkway Investors, LLC, a Delaware corporation; and Coors Brewing Co., a Colorado corporation, Petitioners v. Donald G. PARKER, Respondent.

No. 05SC282.

Supreme Court of Colorado, En Banc.

June 26, 2006.

COPYRIGHT MATERIAL OMITTED

Windholz & Associates, James A. Windholz, David S. Williamson, William P. Hayaski, Boulder, Colorado, Attorneys for Petitioners City of Golden and the City Council of the City of Golden.

Senn Visciano Kirschenbaum Merrick, P.C., Frank W. Visciano, Luis A. Toro, Denver, Colorado, Attorneys for Petitioners Interplaza West Associates, LLP, a Colorado limited liability partnership; and Home Depot U.S.A., Inc., a Delaware corporation.

Lottner, Rubin, Fishman, Brown & Saul, P.C., Richard Brown, Denver, Colorado, Attorneys for Petitioner Sullivan Three Limited Liability Company, a Colorado limited liability company.

Rumler, Tarbox, Lyden Law Corporation P.C., James A. Jablonski, Denver, Colorado, Attorneys for Petitioner Kohl's Department Stores, Inc., a Delaware corporation.

Stiner, Back, Jonson & Nolan, LLP, Thomas A. Nolan, Golden, Colorado, Attorneys for Christopher Hall Realty, LLC.

Holme Roberts & Owen, LLP, James C. Ruh, Kary Klismet, Denver, Colorado, Attorneys for Petitioners Golden Properties, Ltd., a Colorado corporation; GEIH, LLC, a Colorado limited liability company; GEI-6, LLC, a Colorado limited liability company; Coors Technology Center Owners Association, a Colorado nonprofit corporation; Coors Ceramics Company, Inc., a Colorado corporation; Coors Porcelain Company, a Colorado corporation; Bounce, Inc., a Colorado corporation; Graphic Packaging Corporation of Colorado, Inc., a Colorado corporation; Dada Development, Inc., a Colorado corporation; 16200 Table Mountain Parkway Investors, LLC, a Delaware corporation; and Coors Brewing Co., a Colorado corporation.

Victor F. Boog & Associates, P.C., Victor F. Boog, Lakewood, Colorado, Attorneys for Respondent.

Chief Justice MULLARKEY delivered the Opinion of the Court.

I. Introduction

We granted certiorari to consider whether certain real estate developers (the "Developers") who entered into economic incentive agreements (the "Agreements") with the City of Golden ("Golden") and its City Council had vested rights in those agreements that could not be disturbed by an amendment to Golden's home rule city charter (the "Charter Amendment") enacted subsequent to the Agreements which required, with certain exceptions, voter approval of all new grants of development subsidies or incentives in excess of $25,000.¹ The court of appeals held that the Developers did not possess vested rights under the Agreements that precluded application of the Charter Amendment to subsidies and incentives paid to the Developers after approval of the amendment. Parker v. City of Golden, 119 P.3d 557 (Colo. App.2005). We reverse the court of appeals' judgment.

II. Facts and Prior Proceedings

In 1992, Golden established an economic incentives program, contained in the Golden Municipal Code at Chapter 18.60, "for commercial, office and manufacturing development, expansion and upgrade, for purposes of the economic revitalization of the community." G.M.C. § 18.60.010 (2005). The incentives program authorized the City Council to enter into agreements which provided "development subsidies or incentives" including reimbursement of property taxes for up to seven years, reimbursement of sales and use taxes for up to five years, and waiver or deferment of certain development costs to businesses created or expanded within Golden. G.M.C. § 18.60.030.

Also in 1992, Colorado voters amended the state constitution, adding article X, section 20 ("Amendment 1"). One of its provisions requires voter approval in advance of the "creation of any multiple-fiscal year direct or indirect district debt or other financial obligation whatsoever." Colo. Const. art. X, § 20, cl. (4)(b). In 1995, a proposed multi-year economic incentive agreement with Interplaza West Associates, LLP, one of the Developers, was rejected by Golden's voters.

Without soliciting voter approval, Golden entered into five economic incentive agreements in 1998 and one in 1999 which are the subject of this case. The Agreements required the Developers to relocate or establish businesses, annex property, and develop their real property in Golden. In exchange, Golden agreed to share development costs through reimbursement of local property, sales, and use taxes and a waiver of certain development application fees and charges. All of the Agreements provided that the reimbursements did not constitute a multiple fiscal year debt or financial obligation and were subject to annual appropriations by the City Council.

On November 6, 2001, Golden's voters approved an amendment to the Golden City Charter, which required that the city obtain voter approval to grant development subsidies or incentives in excess of $25,000 in any one year. Reimbursement of taxes, refunds granted in connection with development, and waiver or deferment of development fees were included under the definition of subsidies or incentives under the amendment. The Charter Amendment did not specify whether it was intended to apply to the Agreements at issue here.

Subsequently, on June 13, 2002, Golden passed Ordinance No. 1590 (the "Ordinance"), which provided in part that "economic development subsidy or incentive agreements in effect on November 6, 2001, shall remain in effect, subject however to the provisions and conditions of each such individual agreement." In July 2002, following the adoption of the Ordinance, Donald G. Parker, a Golden resident and the respondent here, filed a complaint in the trial court challenging Golden's continuing obligation under the Agreements. Parker sought a declaratory judgment and injunctive relief to prevent further appropriations to Developers in excess of $25,000 absent voter approval.

Golden, the City Council, and the Developers (collectively, the "Petitioners") filed a Motion for Summary Judgment which was granted by the trial court. The court determined that the Developers had vested rights to have the City Council exercise reasonable discretion annually in determining whether or not to appropriate funds to reimburse the Developers under the Agreements. The trial court found that retroactive application of the Charter Amendment to the Agreements would violate the prohibition against retrospective law in the Colorado Constitution. Colo. Const. art. II, § 11. The court of appeals reversed the trial court, holding that the Agreements did not confer vested rights upon the Developers. We granted the Petitioners' request for certiorari review and now reverse.

III. Analysis

Under the Colorado Constitution, the General Assembly is prohibited from enacting any law that is "retrospective in its operation. . . ." Colo. Const. art. II, § 11.² The prohibition against retrospective laws at the state level applies equally to local government. City & County of Denver v. Denver Buick, Inc., 141 Colo. 121, 140, 347 P.2d 919, 930 (1959), overruled on other grounds by Stroud v. City of Aspen, 188 Colo. 1, 532 P.2d 720 (1975). The application of a constitutional standard is a question of law which we review de novo. City of Greenwood Village v. Petitioners for Proposed City of Centennial, 3 P.3d 427, 440 (Colo.2000).

A. Retrospectivity

The general prohibition against retrospective legislation is intended to prevent any unfairness that might result from the application of new law to rights already in existence. In re Estate of DeWitt, 54 P.3d 849, 854 (Colo.2002). Legislation is presumed to operate prospectively unless there is legislative intent to the contrary. Id. Retroactive application of a law, although disfavored, is not necessarily unconstitutional and may be permitted if the law at issue effects a change that is procedural or remedial. Kuhn v. State, 924 P.2d 1053, 1056-57 (Colo. 1996). In order to distinguish legislation that is merely retroactive, we use the term "retrospective" only in regard to legislation that "impairs vested rights acquired under existing laws, or creates a new obligation, imposes a new duty, or attaches a new disability, in respect to transactions or considerations already past." Ficarra v. Dep't of Regulatory Agencies, 849 P.2d 6, 16 (Colo. 1993) (citations omitted).

We use a two-step inquiry to determine whether or not a law is retrospective in its operation. DeWitt, 54 P.3d at 854. First, we look to the legislative intent to determine whether the law is intended to operate retroactively. Id. We require a clear legislative intent that the law apply retroactively to overcome the presumption of prospectivity. Ficarra, 849 P.2d at 14. However, express language of retroactive application is not necessary to find that a law is intended to apply retroactively. Id.

If we find intent of retroactive application, the second step of the inquiry is to determine whether the retroactively applied law operates retrospectively. A law is retrospective if it either "(1) impairs a vested right, or (2) creates a...