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WEST 8e WINTERS
ttotneys at Lau
WILLIAM L. WEST P. O. BOX 127
JERRY D. WINTERS June 6 , 1975 UNITED BANK BUILDING
REGG A. PARISH 1000 TENTH STREET
GREELEY. COLORADO 80631
PHONE 303 . 352-4805
MEMORANDUM
To : Ralph Waldo , Chairman , Finance Committee
From: William L. West
SUBJECT : Limitation on tax -- Letter from Eugene McKenna
I . PRESENT CHARTER PROVISION
Although it has been stated on many occasions previously,
it may be worthwhile to again remind ourselves that the home rule
charter deals with structure . It cannot change the substantive
law.
The present law as set forth in C .R. S . 1973 29-1-301 imposes
a five (5% ) per cent limitation identical to the one contained in
the Charter, Section 14-7 . In my opinion , the amount of limita-
tion as contained in the Charter is a matter of substance and can-
not be changed or modified by the Charter.
The statute , C .R.S . (1973) 29-1-302 provides a method by which
® the limitation may be exceeded. In my opinion, this is a procedur-
al or structural matter and one which the Charter may change or
modify.
The statute provides that in order to exceed the limitation
the County Commissioners must apply to the Division of Local Govern-
ment . If the Division of Local Government approves , then the limi-
tation may be exceeded . If the Division of Local Government does
not approve , then the question of exceeding the levy may be sub-
mitted to the votes for approval . The Charter simply removed the
step by which the approval of the Division of Local Government must
be sought .
This being in the nature of a structural change , I believe it
to be valid .
II . ALTERNATIVE CHARTER POSSIBILITIES
The Charter cannot vary the five (5%) per cent limitation
since this , in my opinion , would not be a structural change . The
Charter can change the procedure by which the limitation may be
exceeded . Suggestions which have been made , simply to return to
the statutory procedure , or to substitute the County Council for the
Division of Local Government would be , in my opinion, valid alter-
natives . Another possibility would be to create a separate body for
that purpose , e . g . all elected county officials .
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III . EUGENE MCKENNA ' S LETTER
Mr . McKenna' s letter really does not materially affect the
limitation problem. The items he mentions are problems regardless of
how the Charter handles the limitations on the ad valorum tax . The
Supreme Court ,in The Colorado State Board of Social Services v .
Billings et al (1971 , 75 Colo 380 , 487 P . 2d 1110) made it crysal
clear that there are instances where , regardless of the budget ,
limitations thereon or availability of funds , the County must meet
certain financial obligations . In that case , the County argued that
it was under no obligation to apply to the Division of Local Govern-
ment for permission to exceed its limitation and no guarantee that
if they did so it would be granted .
The Supreme Court said this did not matter . The County " . . .must
produce their 20%, whether it be from contingency funds , an excess
levy, registered warrants . . . sales tax, or otherwise . "
Thus , it would appear that regardless of the limitation , and of
the procedures for exceeding it, there are instances , such as
Mr . McKenna points out, where the County will have to meet certain
financial obligation irrespective of the budget.
IV . SUMMARY
In summary, a five (5%) limitation may be, and indeed must by
statute , be imposed . The Charter may deal with the procedure for
exceeding the limitation . As a practical matter, it may be desir-
able to provide an easier method of exceeding the limitation than
that presently contained in the Charter .
Regardless of the limitation and regardless of the budget , there
may be instances where the County will have to meet certain finan-
cial obligations which exceed the limitations and the budget .
Respectfully submitted,
fi. L est
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