Denver Urban Renewal Authority v. Byrne

• Decision Date: 27 October 1980
• Docket Number: D,No. 1,No. 79SA394,1,79SA394
• Parties: The DENVER URBAN RENEWAL AUTHORITY, a body corporate and politic of the State of Colorado, Plaintiff and Appellee, v. Charles D. BYRNE, Auditor of the City and County of Denver; the City and County of Denver, a municipal corporation; School Districtenver, Colorado; the Board of Education of School Districtenver, Colorado; Omar Blair, Individually and as President of the Board of Education of School District; Virginia P. Rockwell, Individually and as Vice President of the Board of Education of School District; Naomi Bradford, Robert L. Crider, Marion J. Hammond, Katherine W. Schomp and William R. Schroeder, Sr., Individually and as members of the Board of Education of School Districtefendants and Appellants.
• Court: Colorado Supreme Court

Page 1374

618 P.2d 1374

The DENVER URBAN RENEWAL AUTHORITY, a body corporate and politic of the State of Colorado, Plaintiff and Appellee, v. Charles D. BYRNE, Auditor of the City and County of Denver;

the City and County of Denver, a municipal corporation;

School District No. 1, Denver, Colorado; the Board of

Education of School District No. 1, Denver, Colorado; Omar

Blair, Individually and as President of the Board of

Education of School District No. 1; Virginia P. Rockwell,

Individually and as Vice President of the Board of Education

of School District No. 1; Naomi Bradford, Robert L. Crider,

Marion J. Hammond, Katherine W. Schomp and William R.

Schroeder, Sr., Individually and as members of the Board of

Education of School District No. 1, Defendants and Appellants.

No. 79SA394.

Supreme Court of Colorado.

Oct. 27, 1980.

Kutak, Rock & Huie, Gregory V. Johnson, Denver, Paul C. Benedetti, P. C., Boulder, for plaintiff and appellee.

Max P. Zall, Robert M. Kelly, Donald E. Wilson, Denver, for defendants and appellants, Charles D. Byrne, Auditor of the City and County of Denver, and the City and County of Denver, a municipal corporation.

Michael H. Jackson, Denver, for defendants and appellants, School Dist. No. 1 and its Bd. of Ed.

HODGES, Chief Justice.

Defendants-appellants, Charles D. Byrne, et al., appealed to this court challenging the district court's order mandating Byrne, Auditor of the City and County of Denver (Auditor), to countersign and register a cooperative agreement between the Denver Urban Renewal Authority (DURA) and the City Council (the Council) for the City and County of Denver (Denver). We affirm the judgment of the district court.

The following facts have been stipulated by the parties. Plaintiff-appellee, DURA, a corporate body politic, see James v. Board of Commissioners of the Denver Urban Renewal Authority, Colo., 611 P.2d 976 (1980), was created pursuant to the Urban Renewal Law, section 31-25-101, et seq., C.R.S.1973 (1977 Repl.Vol. 12). DURA prepared a plan (the plan) for the development of what is known as the "West Colfax Urban Renewal Project" (the project) which was approved by the Board of Commissioners of DURA on January 19, 1978. The plan was submitted to the Council as required by section 31-25-107, C.R.S.1973 (1977 Repl.Vol. 12). The Council determined that the project was in conformity with the comprehensive plan for the development of Denver as required by section 31-25-107(2), C.R.S.1973 (1977 Repl.Vol. 12).

In order to finance the project, the Board of Commissioners of DURA approved on April 6, 1978, the issuance of $2,100,000, in bonds as authorized by section 31-25-109, C.R.S.1973 (1977 Repl.Vol. 12). Both DURA and the Council approved a cooperative agreement whereby the bonds were to be issued as "tax-allocation bonds" in conformance with section 31-25-107(9). ¹ The principal and interest of the bonds would primarily be paid from a fund created by a tax-allocation scheme as follows. ²

Property in the project area would be assigned two valuations. Each parcel of property would be given a "base valuation" representing the valuation immediately prior to the approval of the plan. An "incremental valuation" would also be assigned property within the project area. The incremental valuation would represent the valuation subsequent to the approval of the plan. Taxes would be levied each year upon taxable property within the project area in the usual manner. There would be allocated to public use an amount equal to that portion of the taxes produced by the levy upon the base valuation. However any excess revenues, representing the levy upon the incremental valuation minus the base valuation, would then be allocated to a special DURA fund irrevocably pledged to the payment of principal and interest on the bonds. This fund would benefit from the increased valuation of taxable property within the project area after the effective date of the plan's approval. When all the bonds had been retired, no further allocation to the DURA fund would be made. The tax-allocation scheme would continue for a period not in excess of twenty-five years.

The cooperative agreement was submitted to the Auditor for his countersignature, and registration of the agreement, as required by Denver City Charter A7.1-1. This section provides that:

"[The auditor] shall sign all warrants, countersign and register all contracts ...; [he shall see] that no liability is incurred, money disbursed or the property of the city and county disposed of contrary to law or ordinance...."

Pursuant to this provision, the Auditor refused to countersign and register the cooperative agreement.

DURA then instituted an action in the district court seeking a declaratory judgment as to the legality of the cooperative agreement and also relief in the nature of mandamus to compel the Auditor to countersign and register the cooperative agreement. ³ The complaint was amended by DURA to join School District No. 1 (the school district) as a party-defendant. ⁴ The Auditor counterclaimed alleging that the cooperative agreement was unconstitutional and violated the Denver City Charter. All parties moved for summary judgment, which was granted in favor of DURA. The defendants-appellants appealed to this court again challenging the constitutionality of the cooperative agreement. The defendants-appellants concede that the cooperative agreement conforms to section 31-25-107(9), and therefore they directly attack its validity.

I.

A jurisdictional defect may be noticed at any stage of an action whether or not there has been an assignment of error. Peaker v. Southern Colorado Water Conservancy District, 174 Colo. 210, 483 P.2d 232 (1971). Further, standing is a jurisdictional question. Flast v. Cohen, 392 U.S. 83, 88 S.Ct. 1942, 20 L.Ed.2d 947 (1968). Accord Wimberly v. Ettenberg, 194 Colo. 163, 570 P.2d 535 (1979). If a party lacks standing, the case must be dismissed unless this court's original jurisdiction can properly be invoked pursuant to the doctrine of in publici juris. See generally Board of County Commissioners v. Fifty-First General Assembly, Colo., 599 P.2d 887 (1979); Lamm v. Barber, 192 Colo. 511, 565 P.2d 538 (1977).

Although not raised by DURA, a difficult jurisdictional question is presented in this case. Consequently, we asked the parties to submit supplemental briefs discussing the defendants-appellants' standing to challenge the legality of a state statute. In this case, we are confronted with the question whether Denver, the Auditor, the school district, or the members of the Board of Education of the school district have standing to challenge the constitutionality of a statute enacted by the General Assembly.

A long-standing rule of law is that "political subdivisions of the state, and the officers thereof, lack standing to challenge the constitutionality of a state statute directing the performance of their duties." Board of County Commissioners v. Fifty-First General Assembly, supra. This rule has been applied to counties, county officers, and county agencies, e. g., Board of County Commissioners v. Fifty-First General Assembly, supra; Lamm v. Barber, supra; Martin v. District Court, 191 Colo. 107, 550 P.2d 864 (1976); Board of County Commissioners v. State Board of Social Services, 186 Colo. 435, 528 P.2d 244 (1974); Board of County Commissioners v. Love, 172 Colo. 121, 470 P.2d 861 (1970); People v. Hively, 139 Colo. 49, 336 P.2d 721 (1959); People v. Pitcher, 61 Colo. 149, 156 P. 812 (1916); Ames v. People, 26 Colo. 83, 56 P. 656 (1899); and also has been applied with respect to school districts. Denver Ass'n for Retarded Children, Inc. v. School District No. 1, 188 Colo. 310, 535 P.2d 200 (1975). The rationale for this rule is that "[p]ublic policy and public necessity require prompt and efficient action from [ministerial officers of the state.]" Ames v. People, supra. It has similarly been noted that subordinate state political subdivisions, or their officers, may not challenge a state statute unless expressly or impliedly empowered to do so. Board of County Commissioners v. Love, supra, wherein it also stated that such political subdivisions of the state exist only "for the convenient administration of the state government, created to carry out the will of the state."

This general rule is harmonious with the two-prong test of standing recently adopted by this court. In Wimberly v. Ettenberg, supra, we held that "[t]he proper inquiry on standing is whether the plaintiff has suffered injury in fact to a legally protected interest as contemplated by statutory or constitutional provisions." We reaffirmed the applicability of this test in Dodge v. Department of Social Services, Colo., 600 P.2d 70 (1979).

Here, all the defendants-appellants will arguably suffer injury in fact should the cooperative agreement become effective. The general fund of Denver, and consequently, the revenue of the school district, see footnote 4, supra, will arguably be directly and substantially affected. The difficult question is whether a legally protected interest is implicated. In order to resolve this question, the interests of Denver must be considered separately from the school district's interest.

We first consider whether the school district and its board members have a legally protected interest within a statutory or constitutional sense. The long-standing bar preventing political subdivisions and the officers thereof from challenging the validity of state statutes has been expressly applied to school districts. Denver Ass'n for Retarded Children, Inc. v. School District No. 1, supra. School districts may not attack a state statute unless there has been conferred upon them a legally protected interest by either statute, accord, Board of County Commissioners v. Fifty-First General Assembly, supra, or constitutional provision. No such statutory or constitutional provision has been cited to us. We therefore...