'Certificates of Participation' Violate Constitution, Suit Argues

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'Certificates of Participation' Violate Constitution, Suit Argues

by Ari Armstrong, October 8, 2003

Attorney Paul Grant filed a legal suit October 7 on behalf of the Colorado Criminal Justice Reform Coalition and four individual plaintiffs (including me) arguing a law passed by Colorado's legislature earlier this year illegally imposes multi-year financial obligations without voter approval and violates the single-subject rule.

Attorney Paul Grant meets with Stephen Raher and Christie Donner of the Colorado Criminal Justice Reform Coalition at an October 7 press conference.

CCJRC is maintaining a web page about the suit that includes the filed complaint and a press release from October 7.

The legal action challenges House Bill 1256, which authorized "certificates of participation" to pay for the multi-year financing of a prison and a medical facility. This violated two provisions of Colorado's constitution, the suit argues: the provision in the Taxpayer's Bill of Rights that requires voter approval for multi-year financial obligations, and the provision that prohibits legislators from lumping two issues in the same bill.

During the legislative debates over HB 1256, Rep. Dave Schultheis said, "I have to say that I really do believe that using COPs [certificates of participation]... to build a prison would not be appropriate because I believe it is going against the intent of voters when... they asked for TABOR." Sen. Doug Lamborn added, "We owe it to the people of Colorado in such a momentous decision that does involve multi-year debt -- I don't see how you can get around that -- that we should put this to a vote of the people." Nevertheless, in an October 8 article for the Rocky Mountain News, John Sanko reported that a sponsor of the bill, House Speaker Lola Spradley, dismissed the claims of the legal suit as "nonsense." She evaded the legal question by asserting, "This group has an agenda."

The TABOR provision of the state constitution states, "[D]istricts must have voter approval in advance for... creation of any multiple-fiscal year direct or indirect district debt or other financial obligation whatsoever without adequate present cash reserves pledged irrevocably and held for payments in all future fiscal years" (Article X, Section 20-4).

Stephen Raher of the CCJRC displays bundles of (fake) $100 bills that represent the amount of one month's lease payment on the prison.

The state constitution further states, "No bill, except general appropriation bills, shall be passed containing more than one subject..." (Article V, Section 21) The explanation for the provision states, "It is important to bear in mind the evils sought to be corrected by this provision, including the practice of putting together in one bill subjects having no necessary or proper connection, for the purpose of enlisting in support of such bill the advocates of each measure, and thus securing the enactment of measures that could not be carried upon their merits. Catron v. Board of Comm'rs, 18 Colo. 553, 33 P. 513 (1893)."

At the October 7 press conference, Rep. Michael Merrifield called HB 1256 "budgetary smoke and mirrors." He said "the people did not get to have a voice," and he finds it "a little bit hypocritical" that some legislators have claimed to support TABOR but voted yes on the bill.

I added, "Certificates of participation are merely a deceptive way for the state legislature to adopt multi-year financial obligations without first getting voter approval, as the Colorado Constitution requires.

"With apologies to Shakespeare, debt by any other name costs the taxpayers just as much.

"With a wink and a nod and a healthy dose of Orwellian obfuscation, the majority of our legislators, along with our Governor, the very people who share responsibility for passing and signing laws, have instead flagrantly violated the law, both in letter and in spirit.

"Such legislative disrespect for the law can only help breed a general atmosphere of cynicism, political apathy, and a disrespect for the legal system generally.

"If the legislature wishes to enter multi-year financial obligations, it has a perfectly legal way of doing so: get voter approval."

During the legislative hearing, economist Barry Poulson called the use of "certificates of participation" an "elaborate sham."

The Colorado Freedom Report--www.freecolorado.com