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Constitutional tax and expenditure limitation in Colorado

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Constitutional tax and expenditure limitation in Colorado the impact on municipal governments
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Brown, Tommy M
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xviii, 329 leaves : illustrations ; 28 cm

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Tax and expenditure limitations -- Colorado ( lcsh )
Municipal finance -- Colorado ( lcsh )
Municipal finance ( fast )
Tax and expenditure limitations ( fast )
Colorado ( fast )
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bibliography ( marcgt )
theses ( marcgt )
non-fiction ( marcgt )

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Includes bibliographical references (leaves 312-329).
General Note:
School of Public Affairs
Statement of Responsibility:
by Tommy M. Brown.

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University of Colorado Denver
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Full Text
CONSTITUTIONAL TAX AND EXPENDITURE
LIMITATION IN COLORADO:
THE IMPACT ON MUNICIPAL GOVERNMENTS
by
Tommy M. Brown
B.A., University of Texas at El Paso, 1963
J.D., University of Louisville, 1969
A thesis submitted to the
University of Colorado at Denver
in partial fulfillment
of the requirements for the degree of
Doctor of Philosophy
Public Administration
1999


1999 by Tommy M. Brown
All rights reserved.


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This thesis for the Doctor of Philosophy
degree by
Tommy M. Brown
Date
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Brown, Tommy M. (Ph.D., Public Administration)
Constitutional Tax and Expenditure Limitation in Colorado:
The Impact on Municipal Governments
Thesis directed by Professor Franklin J. James, Jr.
ABSTRACT
This study used all of Colorados municipal governments as subjects
for an interrupted pooled, time-series regression analysis focused on the
effectiveness and impacts of two constitutional tax and expenditure
limitation amendments (TELs). Municipal finance trends for more than
twenty years were analyzed.
Although the majority of states have imposed some statutory or
constitutional restraint on specific taxes, only Colorado and California have
adopted TEL amendments so encompassing that they purport to restrict
virtually all revenues and expenditures to strict limits, unless the voters
approve otherwise. Previous studies of TEL effectiveness and impact have
not focused on municipalities or on municipalities of different populations.
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The Buchanan and Brennan public choice theory of constitutional
political economy contends that only constitutional amendment TELs are
sufficiently enduring to restrain the growth of government spending by
withstanding the budgetary onslaughts of bureaucrats, politicians, and rent
seekers.
The study found that per capita municipal tax revenues were
increasing rapidly in real terms prior to either of the two TELs. The primary
purpose of the first TEL was to slow the growth of residential property tax
and to redirect its incidence away from homeowners to business property
owners. Findings suggest that after the first TEL, municipal revenues and
spending did slow their annual rate of increase, but that property tax
revenues unexpectedly spurted upward.
After the second TEL prohibited all tax increases without voter
approval and limited annual revenue growth to strict limits, municipal tax
revenues stopped growing and showed slight annual decreases. Sales tax
revenues continued to rise by less than two percent yearly, but property tax
revenues were declining by nine percent annually. These new trends fell
most heavily on the states smallest towns, particularly those in sparsely
populated agricultural counties.


The study concludes that the constitutional TEL specifically limiting
municipal revenue was effective for its purpose, but that one result may
jeopardize the continued viability of small towns in economically stagnant
areas.
In the presence of TELs, corollary theories that predict specific
spending patterns favoring governments own purposes and slighting public
services could be neither confirmed nor disproved.
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ACKNOWLEDGMENTS
The conduct and completion of this project has been immeasurably
supported by the encouragement, patience, and understanding of my
familySally, Clint, and Peg. Not once did any of them ask, You want to
do what? Thank you.
The faculty and staff of the Graduate School of Public Affairs are
owed my thanks for their encouragement and unflagging support. Professor
Franklin James agreed to serve as chair of my dissertation committee, but he
provided encouragement beyond anything required for that role. Professors
Richard Stillman and Peter deLeon have been teachers and friends. Dean
Kathleen Beatty has been most encouraging. Among the staff, Karen
Wright, Antoinette Sandoval, and Dawn Savage have cheerfully answered
any number of my less than astute questions.
A measure of special gratitude is owed to Dr. Laura Argys for helping
guide a statistics novice through some labyrinthian paths. Finally, l must
especially note the encouragement, friendship, and help of Mr. Sam Mamet
of the Colorado Municipal League. Sam unsparingly gave his time and I
very much appreciate it.
Thanks, also, to the Lincoln Institute of Land Policy, Cambridge,
Massachusetts, for their generous grant of actual money to support the
effort.
For better or worse, the results of the effort are mine, but it was not
done alone.
TMB
Denver, Colorado
March, 1999


CONTENTS
Figures ............................................xii
Tables........................................... xviii
CHAPTER
1. INTRODUCTION.....................................1
Purpose of the Study ......................6
The Setting................................6
Scope and Limitations of the Study .......II
Importance to Public Administration.......18
2. THE AMENDMENTS, THE COURTS,
AND LEGAL ISSUES................................24
The TABOR Amendments Provisions .........25
The Gallagher Amendments Provisions .....29
TABOR and the Courts......................32
Open Legal Issues and
Interactions with other Laws..............40
3. TWO LITERATURES: GOVERNMENT GROWTH
AND TAX AND EXPENDITURE LIMITATION .............47
Introduction..............................47
Vlll


Limiting the Growth of Government
56
Have TELs Effectively Limited the
Growth of Local Government?.............59
Political Purpose.......................64
Governments Reactions and
Coping Strategies ......................66
Problems from the Literature .................68
4. THE COLORADO ECONOMY, 1975-96.......................76
5. A STUDY OF MUNICIPAL FINANCES.......................91
The Subjects..................................92
The Data......................................94
The Analytic Model...........................106
Statistics ..................................Ill
The Analysis.................................114
Variations of the Regression Model....114
Tabular Reporting......................118
6. MUNICIPAL FINANCES UNDER TAX AND
EXPENDITURE LIMITATION ............................124
Introduction.................................124
Revenues and Expenditures in the Aggregate--132
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Revenues
132
Spending..............................155
The Economys Influence.....................161
Election Experiences under Colorados TELs.166
Small Town and Large City Trends............171
Small Towns on Colorados Eastern Plains...193
7. CONCLUSIONS ......................................201
Findings and Interpretations................209
Government Growth in the Absence
of Tax and Expenditure Limitation....209
Growth After the First TEL (Gallagher) ... 211
Growth After the Second TEL (TABOR) 212
TELs and the Eastern Plains ............217
The Economys Impact....................218
Conclusions and Other Thoughts.................220
APPENDICES
A. THE GALLAGHER AMENDMENT
AND RELATED MATERIALS...............226
B. THE TAXPAYERS BILL OF RIGHTS (TABOR
AMENDMENT) .........................234


C. REVENUE AND EXPENDITURE ACCOUNTS......240
D. COLORADOS MUNICIPAL POPULATIONS......245
E. DATA ASSUMPTIONS AND
MUNICIPALITIES EXCLUDED FROM STUDY....270
F. INFLATION INDICES.....................281
G. TABLES OF STATISTICAL RESULTS ........282
REFERENCES......................................312


FIGURES
Figure
4.1 U. S. Gross Domestic Gross Product (GDP)(Real), 1975-96 .... 78
4.2 U. S. Treasury Bill (90-day) Interest Rates, 1975-96 ....... 80
4-3 U. S. Domestic Crude Oil First Purchase Real Price, 1975-96 .... 82
4-4 Colorado Average, Real, Per Capita Retail Sales, 1974-95 ... 83
4.5 Colorado Real State Gross Product, 1977-96 ................. 84
4-6 Comparison of U. S. and Colorado Civilian Annual
Unemployment Rates, 1975-96 ................................ 85
4-7 Colorado Net Migration, 1975-96 ............................ 86
4 8 Colorado Municipal Population (estimated), 1975-96 ......... 87
4.9 Colorado Mean Annual, Real, Per Capita Construction
Earnings, 1974-95 .......................................... 88
6.1 Municipal Total Revenues and Operating
Expenditures, 1975-96 ..................................... 125
6.2 Colorado Per Capita Personal Income
(real dollars, 1975 = 100), 1974-96 ....................... 127
6.3 Mean Colorado Farm Income by Counties
(real, 1975=100, per capita dollars), 1974-95.............. 128


6.4 Mean Colorado Manufacturing Earnings by County
(real, 1975=100, per capita dollars), 1974-95............. 129
6.5 Mean Colorado Services Earnings by County
(real, 1975=100, per capita dollars), 1975-95.............130
6.6 Comparison of Annual Change Trends in Total Municipal
Revenues (Percent of Annual Increase)
1975-84; 1985-92; and 1993-96 ............................ 133
6.7 Municipal Revenue Sources in 1996 (Actual Dollars).........135
6.8 Comparison of Trends in Total Municipal Tax Revenues
(percent of annual increase based on real, per
capita dollars) 1975-84; 1985-92; and 1993-96 ............ 136
6.9 Comparison of Trends in Municipal Sales Tax Revenues
(percent of annual increase based on real, per
capita dollars) 1975-84; 1985-92; and 1993-96 ............ 138
6.10 Comparison of Trends in Municipal Property Tax Revenues
(percent of annual increase based on real, per
capita dollars) 1975-84; 1985-92; and 1993-96 ............ 140
6.11 Comparison of Trends in Charges for Services, Fines, and
Licenses and Permits (percent of annual increase based on
real, per capita dollars) 1975-84; 1985-92; and 1993-96 .. 148
6.12 Comparison of Trends in Miscellaneous, Specific Ownership
Tax, State Aid, and Enterprise Transfer Revenue
(percent of annual increase based on real, per
capita dollars) 1975-84; 1985-92; and 1993-96 ............ 150
6.13 Comparison of Trends in Nine Municipal Expenditure
Accounts 1975-84; 1985-92; and 1993-96 ................... 156


6.14 Comparison of Trends in Four Municipal Expenditure
Accounts 1975-84; 1985-92; and 1993-96 ................... 159
6.15 Comparison of Post-TABOR Trend Percentages with
Economic Indicators Controlled and without Economic
Indicator Controls in Four Revenue Variables ...............164
6.16 Comparison of Revenue Trends for M unicipalities with
Successful Elections vs. Municipalities
without Successful Elections ...............................168
6.17 Comparison of Expenditure Trends for Municipalities with
Successful Elections vs. Municipalities
without Successful Elections ...............................170
6.18 Comparison of Property Tax Revenue Trends by Population
Groups with Assessed Property Values Controlled.............175
6.19 Comparison of Total Municipal Revenues by Population Groups 176
6.20 Comparison of Total Municipal Tax Revenues
by Population Groups........................................179
6.21 Comparison of Sales Tax Revenue Trends
by Population Groups........................................180
6.22 Comparison of Property Tax Revenue Trends
by Population Groups........................................182
6.23 Comparison of Total Operating Expenditure Trends by
Population Groups...........................................185
6.24 Comparison of General Government Expenditure Trends
by Population Groups........................................188


6.25 Comparison of Law Enforcement Spending Trends
by Population Groups .......................................190
6.26 Comparison of Culture and Recreation Spending Trends
by Population Group...........................................192
6.27 Comparison of Revenue Trends for 59 Eastern Plains
Municipalities ...............................................198
G. 1 S ummary of Regressions for Aggregated Municipalities
(with Economic Variables) ....................................283
G.2 Revenue and Expenditure Coefficients as Percentages
for Aggregated Municipalities ................................284
G.3 Summary of Regressions with Economic Variables for
Population Group (1-1,999)................................... 285
G.4 Summary of Regressions with Economic Variables for
Population Group (2,000-4,999) .............................. 286
G.5 Summary of Regressions with Economic Variables for
Population Group (5,000-9,999) .............................. 287
G.6 Summary of Regressions with Economic Variables for
Population Group (10,000-49,999) ............................ 288
G.7 Summary of Regressions with Economic Variables for
Population Group (50,000-99,999) ............................ 289
G.8 Summary of Regressions with Economic Variables for
Population Group (100,000+).................................. 290
G.9 Comparison of Trend Percentages for Population Groups........291
xv


G. 10 Comparison of Gallagher Intervention Percentages
for Population Groups..........................................292
G. 11 Comparison of TABOR Intervention Percentages
for Population Groups..........................................293
G. 12 Comparison of Trend and Intervention Percentages
for Population Group (1-1,999)................................ 294
G. 13 Comparison of Trend and Intervention Percentages
for Population Group (2,000-4,999) ........................... 295
G. 14 Comparison of Trend and Intervention Percentages
for Population Group (5,000-9,999) ........................... 296
G. 15 Comparison of Trend and Intervention Percentages
for Population Group (10,000-49,999) ......................... 297
G.16 Comparison of Trend and Intervention Percentages
for Population Group (50,000-99,999) ......................... 298
G. 17 Comparison of Trend and Intervention Percentages
for Population Group (100,000+)............................... 299
G. 18 Comparison of Population Group Trend and
Post-Intervention Percentages..................................300
G. 19 Summary of Regressions Comparing Municipalities with
Successful Elections vs. Municipalities without Successful
Elections........................................................302
G.20 Summary of Revenue and Expenditure Regressions
without Economic Variables.......................................303
G.21 Revenue and Expenditure Coefficients as Percentages
without Economic Variables.......................................304


G.22 Comparison of Revenue and Expenditure Variables
Effect of Economic Indicators............................305
G.23 Comparison of Population GroupsProperty Taxes with
Assessed Value as an Independent Variable................306
G.24 Components of Total Municipal Revenue (Percent) by Groups 307
G.25 Summary of RegressionsEconomic Variables ..................308
G.26 Summary of Regressions with Economic Variables for
Eastern Plains Group......................................309
G.27 Eastern Plains Group Coefficients as Percentages............311
xvii
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TABLES
Table
1.1 Tax and Expenditure Limitations on Municipal Governments ... 20
2.1 Residential Assessment Ratios...................................30
5.1 Number of Colorado Municipalities by Population Groups..........94
5.2 Municipalities Studied by Groups ..............................117
6.1 Descriptive Statistics for Municipalities of 1 to 1,999 Population
(1996 Actual Per Capita Dollars based on 1996 Population)
(N = 168) ....................................................194
6.2 Components (as a percentage) of Total Municipal
Revenues (1996) by Groups.....................................197
E.1 Municipalities Eliminated from the Study.......................271
E.2 Reported Zeroes for Each Dependent Variable
(N=5,610 for each)............................................274
E.3 Comparison of Regression Results between All
Municipalities and Municipalities without
Zero Data Observations .......................................277
xviii
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CHAPTER 1
INTRODUCTION
Almost as soon as the first settlers stepped ashore, Americans began
to fret about the taxes they pay and the growth of their governments.
Among the chief complaints of the Declaration of Independence was that
the British government had erected a multitude of New Offices, and sent
hither swarms of Officers to harass our people, and eat out their substance.
Government was just too expensiveimposing taxes on us without our
Consent. Before the revolution, Americans protested unfair taxes by
marching on the government in North Carolinas 1771 War of Regulation
(Morison, 1965, p. 196). Even after they had their own government,
Americans continued to protest taxes and government growth. This study
is about these two ideasthe growth of government and citizen efforts to
contain it.
In 1982, Colorado voters approved a constitutional amendment
referred to them by the legislature. Proponents of this Gallagher
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amendment1 were responding in the tradition of Californias Proposition 13
to homeowner concerns about a rising burden of property taxes. As
Colorado was growing, new residential property was coming on to the tax
rolls at a pace significantly ahead of new business and commercial
properties. The concern was that if the trend continued, residential owners
would bear a property tax burden much greater than owners of
nonresidential properties.
In its attempt to address the issue, the Gallagher amendment
mandated a legislative study to determine the then-existing proportion of
statewide property tax collections from residential property owners and
collections from owners of all other classes of property. Once the ratio was
determined (45 percent residential to 55 percent all other), the amendment
mandated biennial adjustments to the residential property assessment rate
so that the proportion of tax collected from each group would remain fixed.
Beginning with a 21 percent residential assessment rate in 1985, the rate has
been continually adjusted downward to its 1998 level of 9}A percent.
1 The full text of the Gallagher amendment is contained in Appendix A
and its terms are explained in greater detail in Chapter 2.
2


Ten years later, in 1992, a citizen-initiated petition led to an election
in which Colorados voters approved another amendment to the states
constitution. This second tax and expenditure limitation2 amendment
limited the amount of growth in revenues and expenditures for the state and
all local governments. Legally entitled The Taxpayers Bill of Rights, the
amendment is also known as the Bruce Amendment (after its chief
proponent, Douglas Bruce), Amendment One (after its numerical
designation on the ballot), or, most prevalently, by its acronym TABOR.3
It mandates that, beginning with 1993, state and local government revenues
and expenditures cannot increase from one year to the next by more than
inflation and a defined growth factor. If revenues exceed the allowed
amount, the government must either ask voter approval to keep the excess,
or refund it to taxpayers. Likewise, any prospective increase in revenues by
2 In the scholarly literature, the phrase tax and expenditure limitation is
universally abbreviated as TEL or TELs.
J One suspects that Mr. Bruce chose the acronym, TABOR, and then, fit a
name to it. The acronym is that same as a famous Colorado name taken from
silver-mining baron Horace Tabor and his scandalous much younger wife,
Elizabeth Baby Doe Tabor. Mr. Tabor lost his fortune in the silver crash of 1893
and died in 1899. Mrs. Tabor became a legend standing by her man at the long-
depleted Matchless silver mine until her death in 1935.
3


tax increase, mill levy increase, policy change, etc., must be approved by
voters.4
Much like the combination of Californias Proposition 13 (now
codified as Article XIIIA of the California constitution) and Californias
subsequently adopted Article XIIIB,5 Colorados two TEL amendments
attempted, first, to address property tax issues and, then, imposed strictly
defined growth limits on the state and all local governments. Study of and
discussion about Californias experience has been extensive and the
conclusions have sometimes been contradictory. Despite the passage of
time, there has been no similar study or discussion of the Colorado
experience.0
4 The full text of TABOR is set out in Appendix B and its terms are
explained in greater detail in Chapter 2.
5 In an obvious effort to promote perpetual confusion, Proposition 13 (its
numerical designation on the ballot) was codified as part of Article XIIIA of the
California constitution. Subsequently, other adopted propositions (with other
ballot designations) were codified in Articles XIIIB (Proposition 4, the 1979
spending limit), XIIIC (Proposition 218, a 1996 requirement for voter approval of
local tax levies), and XIIID (more Proposition 218, related to assessment and
property related fee reform). A full history of the many propositions codified into
Article XIIIA, B, C, and D is available from Freidrich (1999).
0 Acknowledging that it has not surfaced in the academic journals is not
meant to denigrate the extensive discussion and valuable analysis conducted by
municipal officials, the media, and others in Colorado.
4


Expectations of the Gallagher amendment were that it would save
homeowners money and, indeed, the Colorado Division of Property
Taxation reports that the savings have totaled more than $3.1 billion from
1985 through 1997 (Colorado, 1998, p. 11-12). Stronger consequences were
expected of the TABOR amendment, particularly when its interaction with
the other amendment were considered. The common wisdom was that as
Gallagher ratcheted residential assessment ratios down and TABOR
prohibited mill levy increases to recoup the lost revenue, local governments
would be faced with some drastic decisions about spending cuts.
On its face, an amendment such as TABOR would be expected to
have a much broader impact on local government revenue growth than
other, more common TELs that limit only property tax increases.
Nevertheless, as will be seen in Chapter 3, existing research, mostly from
California and Massachusetts, and mostly considering state budgets,
suggests that TABORs effectiveness in curtailing revenue and spending
growth may be limited.
5


Purpose of the Study
This study examines the revenue and spending trends of Colorados
municipal governments before the Gallagher amendment, during the
interim period between the two amendments, and after the TABOR
restraints were imposed. The purpose is (1) to determine whether
Colorados municipal governments were growing as has been the general
academic and popular assumption, (2) to determine if Gallagher and
TABOR were effective constraints and to assess the impacts if they were,
and (3) to decide whether some assessment can be made about how
municipal governments have responded to the amendment.
The Setting
Colorados adoption of TABOR followed in the vein of the latest
American tax revolt, said to have begun with Californias Proposition 13.
Prop 13" was placed on the ballot by citizen petition under the initiative
process, it was approved by California voters in 1978. Concerned only with
an increasingly burdensome property tax, Proposition 13 imposed a ceiling
on property taxes equal to one percent of assessed value (Kirlin, 1982) and
6


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immediately reduced average property taxes (Sherwood-Call, 1987, p. 60
and Wiseman, 1989, p.l).
Two years after California voters upset the tax apple cart,
Massachusetts voters, again focusing only on property taxes, adopted
Proposition 2Vz as their own effort to cut and control property tax growth.
Generally it reduced the property tax rate to 2Vi percent of market value
and limited further growth in local government property tax revenues to 2Vi
percent, plus an annual growth factor (Bradbury, 1991, p. 3). It included
provisions allowing local voters to approve additional property tax levies by
adopting exceptions to the overall formula.
Colorados voters have long been concerned with taxes and the
growth of government. Anti-tax initiatives have been a rather regular
feature of Colorado ballots. Mindful of this widespread sentiment, and
particularly in response to concerns about the property tax, the 1982
legislature referred the Gallagher amendment to voters. After adoption, it
added to and amended Article X, Sections 3 and 15 of the Colorado
Constitution. Gallagher promised lower property taxes for homeowners by
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its mandated periodic adjustments in residential property assessment ratios,
but it did not purport to limit local government revenues or expenditures.
In 1986, an initiative that would have required state and local
officials to obtain majority voter approval, at biennial general elections,
before imposing new or increased taxes was defeated by more than a twenty
percent margin (Smith, 1996, p. 274). Although not the primary proponent
of this initiative, Douglas Bruce, a non-practicing attorney and landlord,
newly arrived from California, had participated in the election effort and
associated himself with it. After the 1986 failure, Bruce formed his own
political committee, named it the Taxpayers Bill of Rights Committee, and
sponsored another, more ambitious attempt at limiting taxes and
government in 1988. The effort garnered only 38 percent of the vote
(Smith, 1996, p. 277). Undaunted, Bruce tried again in 1990, losing by 51 to
49 percent (Smith, 1996, p. 279). On his third attempt, in 1992, the
indefatigable Bruce was successful and the TABOR amendment passed with
about 54 percent of the vote (Smith, 1996, p. 271) -7
7 Smith, D. A. (1996). Populist entrepreneur: Douglas Bruce and the tax
and government limitation moment (sic) in Colorado, 1986-1992, Great Plains
Research. 6 (Fall), 269-294, is a good, succinct history of TABOR and Bruces
involvement in it.

8


As a citizen initiated tax and expenditure limitation, TABOR added
Section 20 to Article X of the Colorado Constitution. It became legally
effective on December 31, 1992, and specifically limits government growth
in revenues from all taxes, not just the property tax. Although Gallagher
does not purport to directly limit any municipalitys revenues, its adoption
may have sent a message of taxpayer sentiment to local governments.
More explicitly, Gallagher and TABOR may well interact with each other as
Gallagher reduces residential assessment ratios and TABOR prohibits
property tax or mill levy increases without voter approval. Thus, a largely
residential municipality might find its property tax revenue declining
because of Gallagher and, due to TABOR, be unable to replace that
revenue without voter approval. Because of their explicit and potentially
indirect effects and interactions, both amendments are discussed.
Just as lay citizens have long been concerned with the growth of
government and effective ways to curtail or control that growth, scholars
have argued for, and attempted to test, various theories as to why
government grows and how its growth might be effectively limited. One of
the many theories seems more directly applicable to Colorados experience
9


than some of the others. Brennan and Buchanan (1980) contend that the
constitutional political economy paradigm is particularly useful in
examining fiscal limitations such as Californias Proposition 13 (and, by
analogy, Colorados TABOR) because these are citizen-initiated decisions
changing the constitution of the existing political system. They follow the
earlier lead of Niskanen (1971) and theorize (1) that government may be
modeled as a Leviathan revenue maximizer, (2) that the normal electoral
cycle of voting representatives in and out of office does not constrain the
growth of government, and (3) that, therefore, the only effective constraints
are long-term fiscal limitations imposed by the voters (see also, Borcherding,
1977; Niskanen, 1975; and Wagner, 1975).
Not only do Brennan and Buchanan contend that government is a
revenue-maximizer, they also theorize that if faced with fiscal restraints,
government will prefer to evade the restraints or to spend for its own
purposes to the detriment of spending on desired public services (Brennan
&. Buchanan, 1980, p. 136-144; Hale, 1993, p. 118; and Bails, 1982, p. 136-
138). In other words, if restrained, government will take advantage of any
loopholes" available.
10


Although many more theories are considered by this study in
Chapter 3, two of thesegovernment as revenue-maximizer and
government as a maximizer of its own, internal benefit have particularly
informed the direction of this research.
Scope and Limitations of the Study
Within this context, the Colorado experience provides an
opportunity to empirically explore some of the more prominent theories
about tax and expenditure limitations and their effectiveness in limiting the
growth of government. Prior to the TABOR amendment, local
governments in Colorado were restricted in their ability to raise taxes
without voter approval,8 but once tax rates and mill levies had been
established, the amount of revenue generated and spending of those
revenues could freely rise without further voter approval. After TABOR,
8 Under long-standing Colorado statutes and constitutional provisions,
municipalities were required to seek voter approval for new taxes and, generally,
for increased tax rates. Even with voter approval, municipal sales tax rates were
limited, with some exceptions, to as much of seven percent as was left after the
state and county rates were subtracted (C.R.S. 1997 §29-2-108). After public
budget hearings, but without further voter approval, municipalities were free to
raise property tax mill levies by as much as 5Vz percent each year (C.R.S. 1997
§29-1-301).
11


these local governments were constitutionally required to obtain specific
voter approval for almost all revenue and spending increases, whether or not
tax rate increases were contemplated.
In its endeavor to assess the effectiveness of these two TEL
amendments and the municipal response to them, this study examines data
for eleven revenue and fourteen expenditure categories,9 for the 22-year
period from 1975 through 1996, for essentially all of Colorados
municipalities. The analysis uses a standard pooled, cross-section, time-
series regression model as described by Sayrs (1989), Greene (1997),
Kmenta (1986), Johnson (1995), and Judge, et al., (1988). In general
terms, the model uses a rime variable for the overall trend, a program
variable for each of the two amendments, six lagged control variables for
economic indicators, and a dichotomous control variable for each
municipality. The resulting regression equation was calculated with real,
per capita data (converted to natural logarithms) for each of the revenue
and expenditure accounts as dependent variables.
9 Appendix C contains a listing of all the revenue and expenditure
categories considered with a description of each.
12


There are some basic assumptions made throughout the study. First
and foremost among them is that municipal government growth can be
validly measured by the monetary metric of its revenues and expenditures.
Municipal governments might be perceived to grow in any number of ways
that may not involve increases in revenues or expenditures. For example,
they can surely grow in the perception of the citizenry by imposing more
numerous or more onerous regulations and mandates, even though these
may be reflected only slightly, if at all, in municipal budgets. Nevertheless,
this study relies solely on data regarding municipal revenues and
expenditures, because it assumes these are valid measures.
The study assumes, also, that the data are reliable. It is prepared by
individual municipal governments and assembled by the Colorado
Department of Local Affairs. The assumption is made that none of the data
has been fraudulently submitted and that it is accurate despite human
propensity for the occasional error.
Nevertheless, there are five caveats about the data that must be
acknowledged at the outset. (1) Replication would be hampered somewhat
because some of the economic and demographic data may subsequently
I
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have been revised by the government agencies that produce it. (2) The
municipal population data used in per capita conversions is based on annual
estimates of the Colorado Department of Local Affairs, rather than on
actual census counts. (3) Conversions from actual to real (inflation-
adjusted) dollar amounts was based on the Denver-Boulder Consumer Price
Index (CPI) as prepared by the U.S. Bureau of Labor Statistics. Although
this index may not accurately reflect the inflation experienced by local
governments, especially those outside the Denver-Boulder metropolitan
area, it was used because the TABOR amendment makes it the legal
definition of inflation.
(4) The economic data used in the study, i.e., personal income,
unemployment rate, farm income, construction earnings, manufacturing
earnings, and retail sales, is available only on a county-wide basis rather
than specifically for each municipality. For this study, the county-wide data
was applied to each city principally located within the county. (5) Finally,
the Colorado Economic and Demographic Information System (CEDIS)
recognized 272 legally incorporated Colorado municipalities.10 Seventeen of
10 These recognized, legally incorporated municipalities are listed in
Appendix D.
14


these were not included in the regression models because more than six
years of data was missing for them during the study period.11 The remaining
255 municipalities were included. Because the municipalities were
aggregated in various groups for study and because of limitations inherent in
the model, the results and findings are applicable only to the municipalities
studied and cannot be generalized to individual cities or towns in or out of
Colorado.
This study makes no attempt to determine whether government
growth is within or without some acceptable or desirable limit. The very
term government growth has come to carry a pejorative connotation as an
evil to be avoided. On its face, such an argument implies that the desirable
goal is that municipal revenues and spending absolutely would not rise from
one year to the next. However, without accounting for at least inflation,
population increases, and economic conditions, such a goal would be
effectively a shrinkage in the public goods and services supplied by
municipalities.
11 They are listed in Appendix E, along with the specific reason for their
deletion from the study.
15


If government grows beyond these adjustments for inflation,
population, and the economy, will it have grown too much, just enough, or
not enough to meet the demand for its services or the desires of its citizens?
The answer to this question is for other researchers and other studies. This
one seeks only to determine whether growth has occurred and if Gallagher
and TABOR affected the trend of any such growth. Many of the possible
effects of government growth or restraint will be explored, but, ultimately
whether something dire or delightful has occurred is an issue not considered
here.
Similarly, this study looks at changes in the patterns and trends of
specific revenue sources and specific spending activities and asks whether
these might have changed after the Gallagher and TABOR amendments
became law. Again, the study will explore some of the ramifications of these
trends, but it does not answer whether any such discovered trend or pattern
changes have been desirable.
Finally, a major limitation of the study is that it explores only one of
Colorados several forms of government. As of 1993, the year after
TABORs adoption, there was one state government, 63 counties, 267 cities
16


or towns, 176 school districts, and 1,467 special and other districts
(Colorado Public Expenditure Council, 1993). This study confines itself to
only the cities and towns; whose number had grown to 272 by the time this
effort was begun. Although studying only one form of the many
governments made the effort much more manageable, it creates a serious
void concerning intergovernmental relationships and interactions.
Just as the two amendments have apparently interacted, probably in
some ways not at all anticipated, local governments in the state are not
isolated one type from the others in all respects. The impacts on one form
of government may produce reactions that, in turn, affect other forms of
government. Some of this interaction is enshrined in law.12 Some of the
interactions are not mandated by law, but may be just as real. Some of these
possibilities will be discussed, but, at the end, neither this study nor any
other can present a completely accurate picture of the effects of these laws
without considering ail of the governments affected.
12 For example, counties are required to build and maintain courthouses
for the states district judicial system.
17


Importance to Public Administration
The most elaborate study would be useless if nobody cared about the
questions asked and the answers proffered. In this instance, the findings
and results lie at the heart of the political, economic, and public opinion
ecology within which public administration as an academic endeavor, as a
profession, and as a concern of the citizenry exists. Are municipal
governments really growing, and, if so, how much.7 Is it possible for voters
to control and even curtail government growth by citizen initiated
constitutional amendments.7 Did Gallagher and TABOR alter the revenue
and expenditure structure of local government (Shadbegian, 1998, p. 133)?
Is government reliance on the much disliked property tax waxing or waning?
Are there some government services that fare better or worse under a
regimen of tax and expenditure limitation?
As the literature reviewed below and in Chapter 3 indicates,
statutory TELs have been researched as they exist in other states, but
Colorados TEL amendments have not been scientifically investigated. To
illustrate the uniqueness of Colorados circumstances and the opportunity it
presents to study the impact of a constitutional, encompassing TEL, Table
18


1.1 shows the University of Colorados Fiscal Discipline Project listing of the
tax and expenditure limitations on municipal governments in the United
States. Only Colorado has imposed an overall, general limit on the
revenues of its cities and towns, although Arizona (since 1921), California
(since 1979), and Colorado
(since 1992) impose limits on overall municipal spending.13 Thirteen states
impose no limit on the revenue or spending of their municipalities. The
remaining 34 states impose only some variation of a limit on property taxes.
13 This observation is made with trepidation and reservation because even
though California is listed as having only a spending limit TEL; the listing may be
accurate in only a most technically abstruse sense. This is not a comparative study
and, hence, not the place to expound at length on the full legal meaning of Article
XIIIB of the California constitution, but in operation it does, first, proscribe
appropriations (spending) over a defined growth limit, but then, it requires that
unappropriated revenues (the amount collected in excess of appropriations) be
refunded to taxpayers. This seems to be close to a revenue limit.
19


Table 1.1
Tax and Expenditure Limitations on Municipal Governments
Original Dates of Enactment
State Overall Property Tax Rate Specific Property Tax Rate Limit Property Tax Revenue Assessment Increase Limit General Revenue Limit General Expenditure Limit
Alabama 1972 1875
Alaska 1972 1972
Arizona 1980 1913 1980 1921
Arkansas 1883 1981
California 1978 1978 1979
Colorado 1992 1913 1992 1992
Florida
Idaho 1978 1967
Illinois 1961 1991
Indiana 1973
Iowa 1972 1978
Kansas 1970
Kentucky 1908 1979
Louisiana 1974 1978
Maryland 1957
Massachusett 1980 1980
Michigan 1949 1978
Mississippi 1980
Missouri 1875 1980
Montana unknown date 1987
Nebraska 1957 1990
Nevada 1936 1929 1983
New Mexico 1914 1973 1979 1979
New York 1894 1986-NYC
North Carolina 1973
North Dakota 1929 1981
Ohio 1929 1976
Oklahoma 1933
Oregon 1991 1916
Pennsylvania 1959
Rhode Island 1985
South Dakota 1915
Texas 1876 1982
Utah 1929
Washington 1944 1973 1971
West Virginia 1939 1939 1990
Wyoming 1890
The following Minnesota, New Hampshire, New Jersey. South Carolina, Tennessee, Vermont, Virginia, and Wisconsin._____________________
Source: University of Colorado, Department of Economics
20


Several researchers have studied changes in the government
spending patterns after a TEL was adopted. McCaffery (1978) reviewed
Californias experience with Proposition 13 and listed a variety of examples
in which school districts eliminated summer programs and classes with small
attendance. The focus of Kemps (1982) assessment was that local
governments in California reduced spending on non-essential services such
as libraries, but did not reduce the budgets for more essential fire and police
services. Ladd and Wilson (1985a) noted that Proposition IVi resulted in
modest cuts in Massachusetts school budgets, but almost no change in fire
and police budgets. McKinley (1984) observed that California schools cut
such programs as summer school and adult education. Vincent (1984, p.
18) said that the most common cutback for California schools was
supervision of the teaching faculty. Rothenberg and Smoke (1982, p. 101)
said that police, fire, and sanitation services were sheltered from cuts in
Massachusetts, but that parks, streets, and possibly libraries seemed
expendable.
In his study of Californias cities and their responses to Proposition
13, Reid (1988) concluded that spending patterns were altered in favor of
21


highly visible essential services, such as police, fire, and health. He found
a large shift away from spending categories that did not produce final
services that are easily and immediately observed by the electorate (e.g.,
general government and public works significant reductions in
desirable but non-essential services such as parks and libraries, and a large
increase in enterprise activities (Reid, 1988, p. 26). Given the similarities
between the California and Colorado TEL provisions that limit spending,
the expectation should be that the Colorado and California responses will
be somewhat similar.
Unfortunately, the Reid study did not address municipal responses in
the form of proposals to the electorate for its approval, although he did
conclude that cities had not behaved as agenda-setting monopolists,
threatening citizens with draconian cuts in essential services in order to
force voters to support excessive increases in local taxes .... (Reid, 1988,
p. 34).
Others, such as Tod6-Rovira (1991), who developed an income-
weighted model of demand for public goods, Borcherding and Deacon
(1972), who studied price and income elasticities for various public goods,
22


and DeBartolo and Fortune (1982), who also studied tax-price elasticities
for public services, have lent some insights to the issue, but they did not
directly study the effects of a TEL as encompassing as TABOR.
This research may be instructive for concerned citizens, public
administration professionals, and academics alike. For the professional, the
results may suggest strategies for coping with TELs. The study also may serve
as an aggregate benchmark of trends and policy implications against which
the experiences and issues of individual municipalities can be examined and
discussed. For the academic, this research may answer some of the questions
now pending, test well-known theories, and suggest other avenues for further
research and consideration. Some of the extant theories may require
modification or reconsideration. For the citizen, the information from this
study may allow a more accurate, independent assessment municipal
government performance over the past two decades, and whether its
responses to Gallagher and TABOR have been acceptable.
23


CHAPTER 2
THE AMENDMENTS, THE COURTS,
AND LEGAL ISSUES
At the end, this study will report its findings about the effects
Gallagher and TABOR have had on Colorados municipal governments and
their citizens, but these findings will be in quantitative form. Whether they
are statistically significant or not will be plain enough: whether they are
practically significant will be a subjective opinion each reader will be free to
reach for herself or himself. Nevertheless, in order for it to be an informed
opinion, it must be reached with some reasonably full understanding of what
the two amendments are and what they purport to accomplish.
As with any other law or constitutional provision, what it purports to
accomplish is dependent not only on its own language, but upon court
decisions that decisively determine what that language means. In the case of
TABOR, the opportunities for the courts to decide this meaning are
abundant because the amendment was not written clearly or concisely.
Many of its provisions are paragons of ambiguity.
24


Given TABORs importance to municipal citizens and governments
in Colorado, given its ambiguities, and given the American penchant for
litigation, it was probably inevitable that TABOR would create a cottage
industry of plaintiffs asking courts to clarify its meaning for this purpose or
that. The resulting decisions determine how municipalities implement and
comply with the amendment.
As one other complicating factor, TABOR was not written on a blank
slate. It is in a constitution that already contained provisions with which
TABOR must interact. This chapter discusses the meaning of TABORs
provisions, its interaction with the Gallagher amendment and other laws, the
judicial interpretations that form context within which TABOR operates,
and the implementation questions raised, but not yet decisively answered.
The TABOR Amendments Provisions
Like its California and Massachusetts progenitors, TABOR has
specific provisions regarding property tax, but it goes considerably beyond the
scope of Propositions 13 and 2Vi because it encompasses much more than
just property taxes. Akin to the entirety of Californias Articles XIII1A and
25


XIIIB, it limits municipal governments spending, revenue, tax increases, new
taxes, and increases in debt almost regardless of the source. Clearly and
specifically, by broadly including essentially all government revenue and
expenditures, TABOR was intended to restrain most the growth of
government (Colo. Const. Article X, §20, §§1). By contrast, Proposition
13 and Proposition 2 Vz were directed solely and specifically at property taxes
with any restraint on the growth of government as an incidental effect.
Despite its all-encompassing language and specifically stated intent,
TABORs provisions nevertheless allow Colorado voters the option of
approving as much government growth as they might desire. Specifically,
TABOR both requires and allows municipal governments to obtain voter
approval at biennial general elections for any new tax, tax rate increase, mill
levy increase, assessment ratio increase, extension of any expiring tax, or any
tax policy change that results in a net tax revenue gain.14 Absent voter
approval under TABOR, spending by municipal governments is limited to
last years level plus inflation and a growth factor that is the net percentage
14 In Colorado, a simple majority is all that is required. For many
increases, California now requires a two-thirds approval.
26


change in the actual market value of all real property in the municipalitys
jurisdiction.
Additionally, the amendment includes detailed requirements for
election and notice procedures should a government seek voter approval. It
includes specific provisions requiring that governments reserve three percent
of their annual spending for emergencies; prohibiting any new or increased
real estate transfer taxes, state real property tax, and local income taxes; and
allowing reductions in or termination of business personal property taxes.15
Finally, TABOR ostensibly allows a municipal government to reduce or
terminate its subsidy of any state mandated program.
The loopholes in TABOR, offering potential evasion or mitigation* 10
avenues, are its own provisions exempting enterprises from the requirement
for voter approval of any increases in revenue or spending, in conjunction
with other Colorado statutory provisions allowing the creation and use of
15 This provision is an effort to empower the legislature to abolish business
personal property taxes, despite Article X §9 of the constitution, which says that
The power to tax corporations and corporate property, real and personal, shall
never be relinquished or suspended.
10 As might be an expected legacy of any closely contested and extensively
debated change in the law, individual opinions about TABOR are strongly held
and vary. One persons mitigation may be anothers evasion.
27


enterprises and special district governments for limited and particular
purposes. Because TABOR defines enterprises as government-owned
businesses that receive less than ten percent of their revenue from state and
local tax sources and that are authorized to issue their own debt obligations,
enterprises and special purpose districts that receive their income from fees
are exempt. Typical examples might include special districts providing fee-
based utility services such as water or sewer or special districts created for
essentially one-time development projects.
TABOR is only one part of the Colorado constitution, and it has to
interact with the other provisions. In the case of conflicts, the courts must
decide what it means and how governments may proceed. As an example, in
Submission of Interrogatories on Senate Bill 93-74 (1993), the Colorado
Supreme Court ruled that state lottery proceeds were not subject to TABOR
because a contrary decision would be offensive to the meaning of
Amendment 8 in the constitution.
28


The Gallagher Amendments Provisions
A significant constitutional section with which TABOR interacts is
the earlier Gallagher amendment. The provisions of the Gallagher
amendment may be even less plainly understandable than those of TABOR.17
Essentially the amendment reduced the assessment ratio18 for residential
property from 30 to 21 percent, it also required the legislature to determine
the total, statewide assessed taxable real property value in 1985 and then to
ascertain the percentage of this statewide total that was attributable to
residential property. The legislature determined that the percentage was 45
percent.
For any year after 1985, the Gallagher amendment requires that
residential assessment ratios be adjusted so that this 45 percent residential
17 As indicated earlier, the full text of che Gallagher amendment is set out
in Appendix A. Because certain documents surrounding the amendment are not
readily available, if at all, extracts from some of these additional documents are
duplicated in Appendix A, also. In particular, excerpts from a July 16, 1987
memorandum of the Colorado Legislative Council Staff (memorandum number
M0714AM/1) aid greatly in understanding the amendment, the intent of its
proponents, and the arguments pro and con.
18 The assessment ratio is a percentage multiplied with actual value to
equal assessed value. In the next step, assessed value multiplied by the mill levy
yields the tax bill.
29


and 55 percent business proportion will be maintained. Because of the
greater growth of residential property relative to the lesser growth of other
property in Colorado, Gallagher mandated that the residential assessment
ratios that were 30 percent, prior to its adoption, be reduced initially to 21
percent and, then ever lower in the succeeding years:
Table 2.1
Residential Assessment Ratios
Year Assessment Ratio (%)
1987 18.00
1989 16.00
1989 15.00
1990 15.00
1991 14.34
1992 14.34
1993 12.86
1994 12.86
1995 10.36
1996 10.36
1997 9.74
1998 9.74
Source: Colorado, 1998, p. II-2, 11-13 and C.R.S. 1997 §39-1-104.2.
Because these assessment ratios are calculated on a statewide basis,
any municipality that is significantly dependent on the property tax for
revenues and is highly residential with little business property might have to
raise its mill levies just to continue to receive the same dollar amount of
property tax revenue each time the residential assessment ratio is adjusted
30


downward under Gallaghers provisions. And, of course, under the usual
interpretation of TABOR, these mill levies cannot be raised without voter
approval. Absent such approval, a jurisdiction as described would have its
revenue automatically ratchet downward if the residential assessment ratio
were reduced. Conversely, if the residential assessment ratio were raised
pursuant to
Gallagher, the local government would have to reduce its mill levy in order
to comply with TABOR.
Prior to the Gallagher amendment, Colorado assessors were using a
1973 base year from which actual value was extrapolated. In 1982, the
Colorado general assembly had already set into a motion the legal and
administrative machinery to change to a 1977 base year. After adoption of
the amendment, the legislature quickly advanced the base year to 1987.
Subsequently, it has been advanced biennially (Colorado, 1989, p. 14-15).
31


TABOR and the Courts19
The TABOR amendment contains nine sections, each of which deals
with a specific subject matter: Section 1, General Provisions, says that the
amendment will supersede conflicting state constitutional and statutory and
local laws. It provides for enforcement litigation, brought either as individual
or class actions, with successful plaintiffs to be paid their reasonable attorney
fees and costs by the defending (only if they lose) governments. On the
if
other hand, a government (even if it wins) will not be allowed to recover its
attorney fees and costs unless the suit against it is determined to be frivolous.
This double standard means the courts will have to review attorney fees for
reasonableness and determine whether the suits are frivolous.
Section 1 also says that should the courts decide that revenues have
been collected, kept, or spent in violation of TABOR, they must be refunded
with ten percent interest. Finally, Section 1 says that required refunds may
be made by any reasonable method, including temporary tax credits or rate
reductions. Apparently, any such refunds need not be proportional to an
19 Preparation of this section was greatly aided by the prior work of
Grimshaw & Hairing, a Denver, Colorado law firm, that has collected, organized,
and synopsized most of these cases in The TABOR Digest.
32


individual taxpayers original payments if it is impractical to identify or
return the prior payments.
There have been a number of court decisions and cases involving the
ambiguous meanings of Section 1. In Zaner v. City of Brighton (1994), the
Colorado Court of Appeals20 decided that TABOR should be interpreted
consistently with other sections of the constitution. This appears to be a
denigration of TABORs stated provision that it should supersede all other
constitutional provisions. In another erosion of TABORs supersede
language, the Court of Appeals ruled that TABOR did not supplant existing
case law interpreting the state constitution (Board of County
Commissioners. 1994). Additionally, the Zaner court decided that TABOR
applied only to issues of government financing, spending and taxation, and
not to other issues. It ruled that the General Assembly could enact
legislation that implements and resolves ambiguities in TABOR and it ruled
20 The Colorado Court of Appeals is an appellate court one level below
the Colorado Supreme Court. Under fairly broad but specified circumstances, its
decisions may be appealed to the Supreme Court. The lower level district courts
are generally obligated to follow the rulings of the Court of Appeals. County
courts are one level lower than district courts.
33


that the TABOR ballot title and submission clause could be examined as an
aid to discerning the intent of voters who approved TABOR.
Other cases have decided that the terms in TABOR should be given
their ordinary and plain meaning (Bolt v. Arapahoe County School
District. 1995) and that TABOR is a limit on government, not a grant of
rights to the people (Bickel v. City of Boulder. 1994, 1995; City of Wheat
Ridge v. Cervenv. 1996; and Zaner v. City of Brighton. 1994). The Colorado
Supreme Court ruled that the post-TABOR opinions of its author and
proponent, Douglas Bruce, would carry no weight in court and that only any
evident contemporary [i.e., pre-TABOR] interpretations might be relevant
for a courts consideration (Submission of Interrogatories. 1993). In another
case, the same court refused to consider Bruces interpretation of TABOR
regarding ballot titles on grounds these opinions were beyond the scope of
the Courts review (Matter of Proposed Election Reform. 1993).
Finally, the Colorado Supreme Court has decided that its standard of
review for whether a government has complied with TABOR will be whether
that government has substantially complied; strict scrutiny will not be used
(Bickel v. City of Boulder, 1994 and City of Aurora v. Acosta, 1995). Any
34


citizen is allowed to challenge a governments compliance with TABOR,
whether or not that citizen has suffered harm (Nicholl v. E-470 Public
Highway Authority, 1995).
Section 2 of the amendment contains a variety of defined terms. The
first issue decided by the courts was that if TABOR did not define a
necessary term, courts would look to pre-existing law (Bickel v. City of
Boulder. 1994). Since TABOR uses the word district to define a wide
variety of government forms, and exempts enterprises from its
requirements, there have been a number of decisions deciding whether
various entities were districts and subject to TABOR or enterprises and
not subject to TABOR.
The E-470 Highway Authority, a public entity formed for the specific
purpose of building and operating a toll road, is a district, as would be true of
any entity with the power to tax, whether or not it used that power (Nicholl
v. E-470 Public Highway Authority. 1995). A regional transit authority is a
district (Regional Transportation District v. Romer, 1993). Whether the
Denver Urban Renewal Authority was a district or an enterprise was the
question in a case settled before the issue was resolved in Against
35


Community Takeover v. Denver Urban Renewal Authority, (1994). In
Bruce v. Hartin (1992), a district court held that the hospital owned by the
city of Colorado Springs was an enterprise because Medicare payments were
non-government funds akin to insurance payments, rather than tax funds.
In another case, the Eagle County Board of Commissioners formed a
nonprofit corporation and designated it as a county enterprise. Its sole
source of income was to be airport passenger facility charges (PFCs) that
had been authorized by the federal government at the behest of the county.
The plaintiffs argued that these PFCs amounted to a grant from the county
because by law it had to be the entity to collect them. The Colorado Court
of Appeals ruled that While PFCs may only be imposed by public agencies
with the approval of the Federal Aviation Administration, there is no
limitation that precludes collection of the fees by a governmental enterprise.
Eagle County may have a TABOR-exempt enterprise operate its airport
(Board of County Commissioners. County of Eagle v. Fixed Base Operators,
Inc., 1997).
Section 3 of TABOR sets out quite detailed and lengthy requirements
for election notices, ballot titles, election timing, and other matters related to
36


the elections that are required under Section 4. This has been a fertile
source of litigation with courts specifically ruling that the language is
ambiguous at best (Zaner v. City of Brighton. 1994 and Campbell v. City of
Arvada, 1994). In a gesture of some small relief to beleaguered city officials
trying to cope with the language, the Colorado Supreme Court, in a case
involving a tobacco tax amendment, ruled that TABOR does not require
every possible effect of a ballot measure to be included within the ballot title
(Matter of Title. 1994).
TABORs Section 4(a) requires a government to obtain prior voter
approval for any new tax, tax rate increase, mill levy above that for the prior
year, valuation for assessment ratio increase for a property class, or extension
of an expiring tax, or a tax policy change directly causing a net tax revenue
gain to any district. One of the first issues decided in this area was that pre-
TABOR elections that authorized unlimited mill levy increases would
continue to authorize the increases without another election under TABOR
(Bolt v. Arapahoe County School District. 1995).
One of the unanswered questions under TABOR is whether a
municipality (or other district), experiencing declining property values or
37


assessment values because of the Gallagher amendment, can raise its mill
levy solely to recoup the lost revenue, without holding an election under
TABOR. The Bolt court may have provided some potential support for such
an argument when it ruled that a mill levy to recover lost revenue from the
previous year or to recoup property tax abatements or refunds need not be
voted on because it is not an increase in tax revenue. The court said We
decline to adopt a rigid interpretation (Bolt v. Arapahoe County School
District, 1995, p. 537).
In perhaps the most important decision of all, the Colorado Supreme
Court decided (Bickel v. City of Boulder. 1994), and the U. S. Supreme
Court (1995) declined to review, the decision that districts may seek present
authorizations for future tax increases where such increases may be necessary
to repay a specific voter-approved debt. Thus judicial support was lent to the
many exemption elections by which municipalities have exempted
themselves from TABORs requirements.21
21 In addition to many municipalities, school districts, counties, and
special districts in Colorado have sought an exemption or de-Brucing in some
form or another. In 1998, the state itself, had such an issue on the ballot asking
voters for permission to keep some $500 million of revenue over TABORs limits
for the purpose of road and school construction. The issue failed.
38


In one of its more conflicting sections, TABORs Section 9 says that
a local district may reduce or end its subsidy to any program delegated to it
by the general assembly for administration. There have been no decisions
regarding municipalities in this area, but Mesa County argued that this
relieved it of the obligation to provide a courthouse as part of the states
court system. Weld County contended that it should be allowed to stop
paying 20 percent of a state-mandated welfare program within the county.
The Colorado Supreme Court rejected both arguments, reasoning that a
county is a political subdivision of the state and the state cannot subsidize
itself (Romer v. Board of County Commissioners of Weld County. 1995 and
State of Colorado v. Board of County Commissioners of Mesa County,
1995).
As the literature reviewed in the next chapter will suggest, it is not
surprising that much of the litigation surrounding TABOR has involved
local government efforts to mitigate its effects, whether by de-Brucing
elections, creation of enterprises, attempts to shed the cost of state-
mandated programs, or efforts to recover revenues lost because of the effects
of TABOR in conjunction with other laws.
39


What is not addressed by the literature is the extent to which tax
opponents will attempt to prevent their fellow citizens from even voting on
tax or revenue increases. This is reflected in much of the litigation over the
proper wording of ballot titles and other such seemingly trivial detail. The
courts have not allowed the contest to degenerate too far into minutia by
ruling that substantial compliance will suffice and strict interpretation will
not be the rule.
Open Legal Issues and Interactions with other Laws
Despite the volume of litigation thus far, there are still any number of
issues suggested by the ambiguity of TABORs language that have not
reached the courts. Many of these unresolved issues suggest that, depending
upon court decisions, TABORs operation may be considerably different in
the future than it has been to date. For example, section (4) (a) of the
amendment requires that any new tax, tax rate increase, mill levy above
that for the prior year, valuation for [the purpose of an] assessment ratio
increase for a property class, or extension of an expiring tax, or a tax policy
change directly causing a net tax revenue gain to any district (emphasis
40


supplied) has to be approved by the voters. Given the sentence structure
and the absence of a comma between policy change and directly causing a
net tax, does the last phrase, causing a net tax revenue gain to any
district, apply to all of the enumerated items or does it apply only to the
immediately antecedent phrase, tax policy change?
A general rule for interpreting the meaning of constitutions or
statutes is that qualifying words, phrases, and clauses are ordinarily deemed
to modify only the last antecedent, i.e., the words and phrases immediately
preceding. This last antecedent rule is not absolutely controlling or
inflexible (73 Amjur 2d § 230 and 82 C.J.S. §334), but it would suggest one
outcome under TABORthat mill levies could not be raised without voter
approval even if no net revenue gain resulted.
This outcome is suggested, also, by another rule of statutory
construction: If there is a comma separating a modifying clause from the
clause immediately preceding, the punctuation is an indication that the
modifying clause was intended to modify all the preceding clauses and not
only the last antecedent (73 Amjur 2d §231). In the TABOR instance,
41


there is no comma which implies that the modifying phrase is meant only for
the last antecedent.22
But the contrary outcome, i.e., that the modifying phrase is meant to
apply to all of the antecedent phrases may be suggested by a decision of the
Colorado Supreme Court in Moschetti v. Liquor Lie. Auth. of City of
Boulder (1971). This was a case involving whether a proposed liquor store
was within a proscribed 500 feet of the University of Colorado campus. At
issue was the meaning of a statute section (C.R.S. 1963 §75-2-39(5) (c)):
The [distance] ... [is] to be computed by direct measurement
from the nearest property line of the land used for school
purposes to the nearest portion of the building in which liquor
is sold, using a route of direct pedestrian access.
If the phrase using a route of direct pedestrian access modified both
property line and building in which liquor is sold, then the store would
not have been too close. On the other hand, if the modifying phrase applied
only the last antecedent phrase, building in which liquor is sold, then the
22 These and ocher such commonly applied rules of statutory
construction are discussed plainly and succinctly in William P. Scatsky, (1984),
Legislative Analysis and Drafting. 2d ed. St. Paul, MN: West Publishing Co., p.
139-142. One of the classic examples of the importance of punctuation to
meaning is The teacher says the inspector is a fool, or The teacher, says the
inspector, is a fool.
42


1
store would have been within 500 feet of the campus. The court ruled that
the store could not be issued a liquor license because it was too close to the
campus.
In the Moschetti case, the modifying phrase was preceded by a
comma, unlike the TABOR paragraph. Despite the statutory construction
rules, the Colorado court ruled that the modifying phrase applied only to the
last antecedent. Would the result be different with the TABOR amendment
that has no comma before the modifying phrase? A reasonable argument
might be advanced that since TABORs avowed purpose is to restrain the
growth of government by limiting its revenues, the sentence is more
consistent with the rest of the amendment if the modifying phrase is applied
to all of the antecedents.
If a successful argument could be made that a municipality is allowed
to raise its mill levy without voter approval, so long as the new mill levy did
not raise the actual revenue of the municipality, then cities and towns could
mitigate the synergistic impact of Gallagher and TABOR as the latter
continues to require that residential property assessment ratios be adjusted
downward. Of course, this argument has not yet been made before the
43


courts, but it lurks as a possibility. This and other potential arguments
suggest that the full meaning of TABORs provisions is still less than certain.
Among the other open issues are some that derive from other
constitutional and statutory provisions dealing with municipal finances in
Colorado. One of the oldest such provisions dates from 1913, when the
legislature prohibited all but home rule cities and towns from raising their
property tax revenues by more than 5 Vi percent annually without prior voter
approval (C.R.S. 1997 §29-1-301).23 Would TABORs prohibition, without
voter approval, of tax policy changes causing a net revenue increase, require
the state to obtain voter approval before changing this requirement or would
each city and town that wanted to take advantage of any increase in the limit
have to obtain prior voter approval? At the time of this writing, the state
attorney general has opined that counties with voter approved exemptions
from TABOR, still have to abide by the statutory restriction (Colorado,
Department of Law, 1998).
Another statutory provision with which municipalities must comply
prohibits the combination of state, county, and a city or towns sales tax rates
23 The original rate was higher, but in recent years it has been reduced
from seven percent to six percent and, then, to the current 5Vi percent.
44


from exceeding seven percent with only very limited exceptions (C.R.S. 1997
§29-2-108). Again, whether some future amendment of this by the
legislature would require a TABOR election is undecided by the courts and
will remain undecided until, and unless, an amendment attempt is made.24
Finally, the remaining major constitutional provision limiting
municipal financial activity is the prohibition against levying an income tax
(Colorado Constitution, Article XX, §§5,6).25 if the voters were to approve
a constitutional amendment removing this prohibition, would TABORs
language that it supersede[s] conflicting state constitutional, state statutory,
charter, or other state or local provisions apply.7 The same issue arises as
between TABOR and Gallagher. The latter amendment requires counties to
impose enough of a mill levy increase to repay the state for payments of
excess school aid monies when the excess was caused by under-assessments,
but TABOR seems to prohibit such an increase.
24 The ability of municipalities to adopt a sales tax under the Colorado
Constitution, Article XX, §6 was discussed and approved by the Colorado
Supreme Court in Berman v. City and County of Denver. 400 P.2d 434(1965).
25 This prohibition was upheld by the Colorado Supreme Court in City
and Countv of Denver v. Sweet. 329 P.2d44l (1958). The presently imposed
occupation tax is an outgrowth of this court decision.
45


Each of these statutory or constitutional provisions illustrates the
potential for future litigation, and the somewhat uncertain and, possibly,
changing nature of TABORs application. It is clear, also, that Colorados
municipalities operated under a variety of tax and expenditure limitations
prior to TABORs adoption and that TABOR likely did not replace these
pre-existing laws. Municipalities in Colorado are now faced with not only
the pre-existing limits, but also, the TABOR limits, and the synergistic
effects of TABOR and these existing limits. The future impact of TABOR
may well change as the many open issues come before the courts for
definitive resolution.
46


CHAPTER 3
TWO LITERATURES:
GOVERNMENT GROWTH AND TAX
AND EXPENDITURE LIMITATION
Introduction
The first modem theory about government growth has come to be
known as Wagners Law. In 1877, a German economist, Adolf Wagner,
argued that government would grow and consume a larger share of wealth as
society became increasingly industrialized, affluent, and populous. Wagner
theorized that demand for government services increased faster than did the
populations wealth because as society became more populous, it became
more complex and the demand for government regulation and intervention
increased accordingly (Wagner, 1958). Since Wagners time, the subject has
been no less compelling and theories about government growth have
propagated with alacrity.
Lewis-Beck and Rice (1985) recount a collection of public opinion
polls reflecting American concern with the size of the federal government.
In 1938 a Gallup poll asked Do you think the federal government is
47


spending too much money, too little, or about the right amount? Even
during the Great Depression, a majority, 61 percent, answered too much.
These authors critique several of the leading theories about the cause of
government growth, including the fiscal illusion created by politicians
hiding the costs of government through indirect revenue-raising methods.
Another favorite is bureaucratic expansion with self-interested bureaucrats
ceaselessly seeking larger budgets (Niskanen, 1971 and Wildavsky, 1964).
Later, Wildavsky changed his mind and by 1975 he argued that
government growth was inverse to economic growth, i.e., that an expanding
economy could contain governments appetite, but a shrinking or stagnant
economy would be faced with an increasing government share (Wildavsky,
1975, p. 232-235). In 1980, he argued for another theory, contending that
the body politic, in reality, is a collection of special interests. Each of these
competes for this government program or that, selfishly disregarding any
collective assessment that the sum of all these programs is unchecked,
uncontrolled government growth (Wildavsky, 1980).
Wildavsky was not the first to suggest the interest group theory. Elder
(1992) critiqued the theory as it had been earlier expressed, in one form or
48


another, by Niskanen (1971), Olson (1982), and others. Where others had
not offered a solution (assuming that it is a problem), Wildavsky contended
that a constitutional amendment would force the citizenry, as a whole, to
accomplish what it could not as fragmented interest groups.
The original bureaucratic expansion theory was postulated by
Niskanen (1971). He contended that bureaucrats attempt to maximize their
budgets, because it is in their interests to do so, and that the strategies they
adopt contribute substantially to government growth. Twenty years after his
initial proposal, Niskanen was willing to modify the original theory only to
the extent of redefining the budget being maximized. His underlying
assumption remained that government continues to grow and that much of
the impetus comes from bureaucratic behavior (Niskanen, 1991, p. 13-31).
Others have argued that various crises cause government growth to
rachet upward. In an early study, Peacock and Wiseman (1961) documented
ratchets in public expenditure growth in the United Kingdom. Bourne
(1964) called war the health of government. Rasler and Thompson (1985,
1989) looked at the relationships between wars and government growth in a
number of countries. Higgs (1987) contends that these crisis ratchets are
49


but one part of a more complicated process of government growth. In a more
recent empirical examination of the ratchet theory, Holcombe (1993) used
an interrupted time-series analysis with a maximum likelihood estimator
(somewhat akin to this study, without the cross-sections) to conclude that
real, per capita federal spending ratcheted upward after the Civil War, again
after World War I, after the Great Depression, and, again, after World War
II. The difficulty with the ratchet theory, and Holcombes attempt to
confirm it, is that the theory postulates permanent increases in government
spending that coincide with crisis periods, but does not explain why the
growth did not decline after the crisis was over.
Walker and Vatter (1997) take issue with Higgs (1987) contention
that economic and political crises have caused government size to rachet
upward and with Niskanens (1971) budget maximizing bureaucrat. Instead,
they argue that government growth is essentially driven by failures in the
private market. Their position is that when the market produces undesirable
outcomes, society demands that government intervene, thereby inevitably
causing growth (Vatter &. Walker, 1990). Nevertheless, it has been
50


demonstrated that government spending grows significantly during wars and
it is hard to put war at the doorstep of private market failures.
The difficulty with theories emphasizing a single cause of government
growth is that such a complex phenomenon is almost certainly caused by
many variables, particularly when considering government growth at
different levels of the United States system. The federal system, itself, has
been argued to be a cause of government growth as compared to unitary
systems of government (Grossman & West, 1994). Following a wonderfully
American penchant for conspiracy theories, Brennan and Buchanan (1980,
p. 185) even suggest that separate government units may collude to expand
government taxing and spending.
Borcherding (1977 ) attempts to derive formulas that would
quantitatively ascribe portions of government growth to a variety of
economic factors, including inflation, population growth, rising costs in the
face of price inelastic demands for government services, the rising affluence
of the population, and increasing societal interdependencies. He places
these factors as responsible for about half the increase in government
spending (Borcherding, 1977, p. 56). Moving on to political factors,
51


Borcherding further argues that while he cannot quantitatively delineate the
contribution, fiscal illusion (the publics perception of taxes is imperfect
and subject to gross understatement), the growth and proliferation of special
interest groups, and finally the budget-maximizing bureaucrat are possible
explanations.
There is an extensive and growing literature theorizing and
attempting to assess empirically theories about the cause of government
growth. In 1975, Tarschys (1975) reviewed much of the literature to that
date. Among the more prominent socio-economic perspectives he examined
were industrialization, urbanization, demographic changes in the age of the
population, technological advance, and market extension (as a society
develops more foreign markets, its government may be expected to become
involved in the marketing effort and in international cooperative ventures).
On a consumer level, Tarschys suggested income-elastic demands (as people
become affluent they demand more government services), a demonstration
effect (the media and advertising may create a keep-up-with-the-Joneses
effect between societies), interest groups, and political strife. Other theories
mentioned in Tarschys review include federalism (many governments
52


making decisions tends to raise the overall level of government growth),
organizational expansion, and the increasing number of bureaucrats who are
also voters. One of the more telling indicators of the great size of this
literature is the fact that even the many reviews of it have been summarized
and reviewed (Larkey, Stolp &. Winer, 1981).
Most of these theories appear to be concerned with the growth of the
national government, and their proponents pay only scant attention to
municipal or other local governments. Much of the effort to assess them
empirically has used data at the national government level. Nevertheless,
without too much imagination, it is possible to suggest that many may have
some applicability to municipal governments. For example, if people demand
more government services as they become more affluent, this could be tested
at the municipal level, as well as at the national or state level. Surely one
could test the budget-maximizing bureaucrat theory for at least larger
municipalities that have bureaucracies. A test of it for some of Colorados
small towns, with only two or three employees, would be more doubtful.
Despite these more obvious possibilities, theories specific to
municipalities are much more scarce in the literature than those directed at
53


national governments, but there are a few. For example, Brazer (1959) made
a comparison of municipal finances among several cities in the United States
and found population density, median family income, and intergovernmental
revenue to be the best explanatory variables. Miranda (1993) tests the
strong party organization theory of municipal finance with a case study of
Chicagos finances after the demise of Mayor Richard J. Daleys political
machine. This theory argues that cities governed by strong party
organizations are less responsive to the spending demands of interest groups
and, therefore, better able to be fiscally conservative. Miranda found only
limited support for the theory in Chicago.
Nevertheless, all of the government growth literature still may be
criticized in the words of Lowery and Berry (1983, p. 688): The existing
literature consists of a large number of very simple and separate models;
there has been a steady proliferation of explanations with little or no
attention to theoretical integration. Despite voluminous and energetic
effort, not much has changed since Lewis-Beck and Rice (1985, p. 7)
observed that we face many underdeveloped models that are
unsubstantiated by empirical research. Musgraves (1969, p. 124)
54


observation that the attempts to support empirically or disprove the many
theories have proved inconclusive at best seems as trenchant today as it was
three decades ago.
If so extensive a body of literature has been unable to develop an
integrated theory explaining the causes of government growth or to
conclusively and convincingly substantiate one or more of them, then it
seems rather unlikely that a study confined to Colorados municipalities is
going to accomplish such a monumental task either. This research simply is
not going to make any such futile effort and it was not designed to do so. It
does, however, examine the assumption that government grows, an
assumption common to all of the theories.
The studys methodology has controlled for inflation, population
growth, and various economic indicators (all within the limits outlined in
Chapter l). So it will be possible to argue that the results are net of those
factors, but it will not be possible to ascribe any observed growth to one or
more of the myriad of other possible causes or theories. This study simply
does not seek to determine why municipal spending grows, rather it asks the
fundamental question assumed by each of the theories, does it grow? By
55


controlling for the effects of inflation, population, and the economy, the
question, arguably, can be refined to whether municipal spending grows as
the result of the decisions of its officials and citizens, but the reasons for
those decisions are not explored here.
Assuming for the moment that municipal spending does grow, the
second issue with which this study is concerned is whether TELs such as the
Gallagher or TABOR amendments are effective in constraining it. For this
issue, the relevant literature is almost as extensive as that concerned with
why it grows.
Limiting the Growth of Government
Just as many scholars have studied and theorized about the causes of
government growth, almost as many have examined efforts to limit its
growth. As the first nationally known tax and expenditure limitation,
Californias Proposition has been studied from almost the day it was
proposed.20 (As early examples, see Danziger, 1980; McCaffery &. Bowman,
20 Given the time periods included in many of these studies, it appears that
the authors were studying the effects and impacts of both Proposition 13 (1978)
and Proposition 4 (1979), but most have not made any distinction between the
two amendments. Actually, most do not even mention Proposition 4.
56


1978; Oakland, 1979; Peterson &. Claxton, 1979; Post, 1979; and Shapiro &.
Morgan, 1978.) Throughout the 1980s and since, studies of Proposition 13
and subsequent tax and expenditure limitations have continued, and the
literature has burgeoned. Despite its extent, this literature may be
conveniently categorized and considered along several dimensions, including
the state or states that were examined. Thus, much of the literature has
focused on Proposition 13 and its effect, or lack thereof, on the tax structure
or the relationships between state and local government in California
(Chemick &. Reschovsky, 1982; Danziger, 1980; Duke & Cohen, 1983;
Galles, Long & Sexton, 1995; Jeffe &. Jeffe, 1988a; Jeffe & Jeffe, 1988b;
Kaufman &. Rosen, 1981; Kemp, 1982; Leavitt, 1982; McCaffery &. Bowman,
1978; McKinley, 1984; Oakland, 1979; Peterson, 1981; Peterson & Claxton,
1979; Post, 1979; Reid, 1988; Schwadron & Richter, 1984; Sears & Citrin,
1982; Shapiro, 1981; Shapiro & Morgan, 1978; Sherwood-Call, 1987;
Vincent, 1984; and Wiseman, 1989).
As the second most famous TEL, Massachusetts Proposition 2 Vi has
received its share of attention (Bradbury, 1991; Bradbury, Ladd &
Christopherson, 1982; Davis, 1983; Hale, 1993; Ladd & Wilson, 1982; Ladd
57


&. Wilson, 1983; Ladd &. Wilson, 1985a; Ladd &. Wilson, 1985b;
Rothenberg &. Smoke, 1982; Susskind & Horan, 1983a; and Susskind &
Horan, 1983b). Some have studied both California and Massachusetts
(Flaherty, 1992). The only other states to have received individual attention
in the literature have been Oregon (OToole &. Stipak, 1998, 1994 and
Stipak, OToole &.Guo, 1993); Michigan (Brokaw, Gale &.Merz, 1990 and
Courant, Gramlich &. Rubinfeld, 1985); Texas (Cope &. Grubb, 1982); New
Jersey (Megdal, 1986); and Illinois (Temple, 1996).
Much of the literature has used the state as a unit of analysis and has
considered the overall effects of TELs among the several states which have
adopted them in some form or another (see for example, Bails, 1990; Elder,
1992; Howard, 1989; Joyce &. Mullins, 1991; Kenyon &. Benker, 1984;
Mullins &. Joyce, 1996; Shadbegian, 1996; and Shadbegian, 1998).
Given significant differences among the specific TEL provisions
adopted in various states; court interpretations; the status of the states
economy at the time of adoption; the identity, motivations, and intentions of
those promoting adoption; and a host of other economic, demographic, and
political variables, it seems problematical that studies of one state or several
58


states could be particularly generalizable to another, specific state. No
significant study of Colorados TELs has been located in the scholarly
literature and Colorados experience may be quite dissimilar to other states.
Have TELs Effectively Limited the Growth
of Local Government?
The focus of many of the studies has been on whether TELs have
achieved their purported or incidental intention of limiting the size and
growth of state and local governments. Bails (1990) updated his 1982 study
by asking (1) whether TELs had actually led to reductions in the growth of
state government budgets, (2) whether the enactment of TELs led to any
change in the proportion of personal income devoted to financing state
government, and (3) whether state legislatures had actually adhered to the
limits required by TELs. By statistically comparing the trends in per capita
personal income and per capita state expenditures for the pre-revolt years
of 1973-77 and the post-revolt years of 1977-81, Bails concludes that the
TELs had no significant effect. Anticipating the argument that TELs might
have resulted in fewer or smaller tax increase proposals, Bails also tested
59


these proposals in TEL and non-TEL states for pre- and post-revolt years.
Again, he concluded that no significant effect was apparent.
Bails attempt to address the argument about whether any decreased
growth resulted directly from TELs or indirectly from changed attitudes
brought about by passage of the TEL anticipates the same argument made by
Poterba (1995) and Shadbegian (1998) several years later.
Kenyon and Benker (1984) compared the growth of state government
expenditures relative to personal income growth in TEL and non-TEL states
during the period of 1977-83 and found no significant differences. Howard
(1989) compared average state revenues and expenditures relative to
personal income in TEL and non-TEL states from 1979 through 1987 and
also found no significant differences. Joyce and Mullins (1991) found that
TEL states did experience a short-term decline in revenues but a long-term
increase between 1960 and 1988.
60


Mullins and Joyce (1996) did a pooled rime-series analysis of an
extensive set of independent variables27 including the percentage change in
real gross state product, ratio of general expenditures to gross state product,
population ratios by age groups, etc., and concluded that (1) TELs had little
effect on the overall size of the state and local public sector; (2) TELs did not
lead to less use of broad based taxes at the state level, but local taxes had
been reduced and replaced by more reliance on state aid and user charges;
and (3) TELs had forced state governments to assume increasing
responsibility for spending in most categories, except welfare.
Shadbegian (1996) concluded that TELs significantly increased the
elasticity of government size and growth relative to personal income, but, on
average, did not limit either the size or growth of state government. For
states with below average personal income, he found that TELs did limit
government size. In keeping with the purported intention of TELs to limit
the size and growth of state and local government, Shadbegian found that
27 These authors do not very clearly explain which fixed effects model they
used, but apparently, it was similar to the one used in this study. They do not
indicate the calculation of panel corrected standard errors and it seems likely that
they did not use them. If Beck and Katz (1995) are correct and these panel
corrected standard errors were not used, the significance of the reported results
may be overestimated.
61


they were successful in states with low income growth, but perversely,
increased government growth in states with high income growth.
In a later study of local government budgets, aggregated for each state,
Shadbegian (1998) concluded that TELs decreased the level and growth of
local government revenues and expenditures, and decreased the level and
growth of property taxes. He used a pooled, time-series analysis with
dichotomous control variables for time and for each state. Dependent
variables, including real own-source revenues (total revenues minus
intergovernmental revenues), real property tax per capita, and real own
expenditures per capita, were regressed on population, real personal income,
real per capita intergovernmental revenue from the state, and real per capita
intergovernmental revenue from the federal government.
Although published in 1998, the study did not use any data after
1992. Relying on a 1995 Advisory Commission for Intergovernmental
Relations (ACIR) study, Colorado was included in his study as a TEL state
on the basis of the property tax limits imposed by the legislature in 1913
(C.R.S. 1997, §29-1-301), not because of the 1982 Gallagher or the 1992
62


TABOR amendments. Given this example of inattention to significant fact,
some skepticism about the Shadbegian study is inevitable.
Nevertheless, he does raise, again, the which-came-first, chicken-or-
egg argument that must be acknowledged. He contends that a states
adoption of TEL law may signal a voter preference for smaller government
and it may be this preference, rather than the TEL, itself, that is responsible
for any slowed growth or reduced government expenditure. The argument
on this point may be colored by his observation that No state-imposed local
TEL is necessarily binding with respect to local expenditures and revenues
(Shadbegian, 1998, p. 119).
Whether or not this statement applies accurately to the TELs in other
states, Colorados TABOR amendment is surely binding on its municipal
governments. None of the TABOR litigation has even questioned the
authority of the amendment and given its stature as part of the states
constitution and its mandatory language, such a challenge might daunt even
the most intrepid lawyer.
Notwithstanding the efforts of Shadbegian and others, given
significant differences between Colorado and other states in a wide
63


assortment of pertinent variables, whether TABOR (or coincidental voter
preference) has effectively impacted the growth of any of Colorados
municipalities is a question that cannot be answered without specific study of
Colorados experience.
Political Purpose
Many of the studies assume that the political purpose of TELs in
general, or any TEL in particular, is to limit the size and growth of state and
local government. Having made that assumption, many also surmise
(Shadbegian notwithstanding) that voters, nevertheless, did not seek any
significant reduction in public services. The logical conclusion is that voters
want to have their cake and eat it, too or, perhaps put more diplomatically,
were expecting increased efficiency in government operations to make
continued services compatible with lower revenues. The literature behind
these assumptions is generally specific to particular states and the
conclusions may not be generalizable to other states (see for example,
Brokaw, Gale, &Merz 1990; Courant, Gramlich, &.Rubinfeld 1985; Ladd &.
Wilson 1983; Ladd &. Wilson 1985a; and Sears & Citrin 1982).
64


Several other explanations have been offered for the wave of TELs
since 1978. Neiman and Riposa (1986) suggest that voters are satisfied with
current service, but are hostile to public employees and are generally
conservative in their political views. Another proffered explanation is that
the electorate is polarized with a large minority favoring smaller government,
another large minority favoring increased services (or several minorities
supporting several different services), and a group of swing voters that
might go either way, depending upon perceived fairness, tax burden, or the
economy (Hale, 1993).
Other explanations suggest that governments are revenue maximizers
and will not adhere to spending or taxing restraints that can be evaded
legally (Buchanan, 1967, 1991 p. xv); taxes have been increasing while
inflation and other factors have been eroding middle-class income (Boskin,
1979); or the tax revolt is largely the result of rapidly increasing property
taxes (Mikesell, 1979). In her study of voting patterns for Illinois cities and
towns seeking home-rule status, Temple (1996) concluded that communities
with large variations in the age of the population were more likely to have
voters who would vote for fiscal limitations as a means of protecting
65


themselves from large welfare costs for services that they did not want but
that were desired by other residents.
Governments Reactions and Coping Strategies
Again, public choice theorists have contended that government
officials are revenue maximizers who will not abide by TELs they can evade
(Buchanan, 1967, 1991). This contention, juxtaposed with a presumed
voter rationale of limiting government growth by approving TELs, leads to an
assumed confrontation between the citizenry and its public officials over
directly contrary aspirations.
Stipak, OToole, and Guo (1993) studied Ballot Measure 5, a 1990
Oregon TEL, that reduced school district property tax rates and directed the
state government to replace any lost revenues. Although the TELs effect
remained unclear, either in total or for any specific district, they surveyed all
293 Oregon school superintendents on their perceptions of the anticipated
effects. Not surprisingly, 97 percent of those responding expected the TEL
to reduce their revenues. Despite a requirement that the state government
replace those revenues, most of the superintendents did not believe the state
66


would do so entirely, but did believe that the measure would result in more
state control over schools and less local control. Perhaps the most
interesting finding was that Oregon superintendents, rather than using
across-the-board cuts, expected to make much use of such strategies as
cutting non-basic services, temporary reductions in expenses, and cutting
expenses on the basis of defined goals.
In another study, OToole and Stipak (1994) surveyed non-school
local government officials in Oregon on their views of Ballot Measure 5
shortly after its passage. These managers responded along the same lines as
had the school superintendents and most did not really expect to react to the
TEL in any way that would fundamentally change the status quo. Three
years later, OToole and Stipak (1998) surveyed Oregons local government
officials again to determine how experience would compare with
anticipation. They concluded that Ballot Measure 5 had changed the fiscal
playing field for local governments, but that its effects had not been so
severe as anticipated.
In a theoretical modeling exercise, Toma and Toma (1980) supported
the Brennan and Buchanan model of bureaucratic utility-maximizing activity
67


in the face of fiscal limitations, but did not attempt to confirm empirically
their model.
Obviously none of these limited studies of local government
perceptions of TELs and coping strategies has directly addressed the
Colorado experience. Again, given major differences in the TEL provisions
and the political, economic and legal ecology of each state, experiences from
one state to another may be significantly different.
Problems from che Literature
A myriad of theories have assumed that government revenues and
expenditures grow and have ascribed a wide variety of reasons to the
presumed growth. Some scholars have tested this assumption with respect to
national governments, fewer have tested it for state governments, and fewer
still have tested it for municipal governments. No literature has been found
that tested the assumption for Colorados municipal governments with their
unique-to-Colorado legal, political, and economic circumstances.
Although the TEL literature has addressed a variety of issues and
theories, none of it has specifically attempted to test whether Colorados
68


municipal governments have grown and whether the Gallagher and TABOR
amendments have effectively constrained any such growth. Nor has any
directly tested whether government, now fiscally constrained, will either
evade the restraint or maximize its own utility by preferring to spend
internally for non-functional purposes over functional spending to provide
public goods and services. For Colorado, the government growth and TEL
literatures raise many more issues than they resolve.
The issues for this study are suggested by the fact that the common
theoretical assumption is that government, measured by its revenues and
expenditures, grows over longer periods of time. The first question this study
must answer is whether this assumption is correct for Colorados
municipalities.
1. Did real, per capita, total revenues and total expenditures of
Colorados municipal governments increase during the period
from 1975 through 1996? The hypothesis is that there was a
positive rate of increase.
As suggested by Brennan and Buchanan (1980), constitutional
amendments that will survive over many budget cycles are required to limit
69


effectively government revenue and spending growth. Gallagher and
TABOR are such amendments. Somewhat akin to Californias Proposition
13 and Massachusetts Proposition 2 Vz, Gallagher was confined to property
tax issues. Unlike Proposition 13 or Proposition 2 Vz, Colorados TABOR
amendment mandates a limit on essentially all municipal revenues and
expenditures. The next question for this study derives from the unique
research opportunity presented by the adoption of Gallagher and TABOR,
and the Brennan and Buchanan (1980) implication that a constitutional
amendment such as TABOR will effectively constrain the growth of
government revenues and expenditures:
2. Other things being equal, such as inflation, population growth,
and economic influences, was there a change in the rate of
growth in municipal revenues and expenditures after the
adoption of the Gallagher amendment and, again after the
TABOR amendment.7 The hypothesis is that the rate of
growth in real, per capita terms was highest during the period
from 1975 through 1984, decreased from 1985 through 1992,
and decreased further after 1992.
70


Some of the literature has gone beyond the issue of whether TELs
effectively constrain government growth and looked at how governments
have responded to newly adopted TELs. For example, Brennan and
Buchanan (1980, p. 136-144) and others (Hale, 1993; Bails, 1982; Mullins &
Joyce, 1996; and Shadbegian, 1998) have followed Niskanens (1971) lead
and suggested that government officials will evade TEL restraints where
possible. TABOR offers several possible avenues for such evasion:28 the
exemption for enterprise revenue and expenditures, partial exemptions for
nontax revenues, and exemption elections. Thus the next questions ask:
3. Again, ceteris paribus, was there a change in the rate of
growth, in real, per capita terms, for different revenue accounts
after adoption of each of the TEL amendments.7 Is there a
difference in the rates of growth for municipalities that have
had successful exemption elections and those that have not
had such elections.7 The hypothesis is that certain nontax
revenue accounts will show an increase in this rate of growth
28 Use of the word evasion is not meant to imply chicanery. Whether
the result is entirely satisfactory to che citizenry or not is outside the scope of this
study and may well be in the eyes of the beholder absent some legal sanction on
it.
i


and that municipalities with successful exemption elections
will have higher rates of increase in revenues.
As suggested by the literature that contends public officials will prefer
to spend newly constrained resources more for their own benefit and less for
public benefit, and following Shadbegians (1998, p. 133) suggestion, this
study examines the issue by looking for changes in the patterns of spending
in different, standard municipal accounts.
4. Was there a change in the growth of real, per capita spending
after the TELs? The hypothesis is that some expenditure
accounts, such as general government, will have rates of
increase higher than other accounts, such as law enforcement,
fire protection, and recreation.
Although TABOR mandates limits on all revenues, it clearly
emphasizes the property tax by defining the growth limit for municipalities in
terms of property value. Both Propositions 13 and 2 Vi suggest that much of
the voter concern in the history of the movement toward TELs has been
about the property tax. Shadbegian (1998) discerned a decrease in the
growth of local government property taxes in those states that had TELs.
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Mullins and Joyce (1996) discovered an increased local government reliance
on state aid and user charges after TEL restraints were adopted. Thus this
study looks at changes in the patterns of real, per capita growth for various
standard municipal revenue accounts.
5. Holding economic influences constant, was there a change in
the real, per capita growth trends for sales tax, property tax,
sales tax, charges for services, permits and fees, and fines and
forfeitures after TABOR became effective? The hypothesis is
that there would be a decrease in the growth rate for property
tax revenues, and an increase for the other revenue accounts.
At the outset, this study was described as being about two issuesthe
growth of government and citizen efforts to constrain it. It is still about
these two issues, but the interplay between them is not confined to one
inning in which government grows and is constrained. Rather, the contest
proceeds through many innings of growth, constraint, government response,
citizen reaction, and so on. It is the extended contest that this study
explores and it does so by methods that essentially examine long-term
patterns, trends, and interventions in those trends.
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One of the more persistent Colorado public sector responses to
TABOR has been the expressed opinion that TABORs effects have not
been too drastic, as yet, because the economy has been booming. This is
almost always followed by the question: what will happen when the economy
turns downward? Sales and property tax revenues are important components
of total municipal revenues. Although California has gone through
economic fluctuations since Propositions 13 and 4 were adopted in the late
1970s, the literature examining that states experience has not attempted to
control for economic conditions beyond inflation and, therefore, provides no
useful suggestion as to what might be expected from Colorados experience.
However, because revenues from these taxes are directly related to
fluctuations in retail sales and property values, the expectation is that
contractions in the economy sufficient to lower property values or retail sales
would result in reduced municipal revenues.
6. Are the real, per capita growth rates for municipal revenues
and expenditures dependent upon fluctuations of economic
conditions? The hypothesis is that municipal revenue growth
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trends will be significantly affected by fluctuations in the
economy.
The burden of the next chapter is to set the stage for an
examination of this issue by describing the economic conditions within
which Gallagher and TABOR, thus far, have operated. Afterward, the study
attempts to control for these economic effects as it examines the trends in
revenue and spending that preceded and followed the adoption of these two
TEL amendments.
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CHAPTER 4
THE COLORADO ECONOMY, 1975-96
Even located in a part of the United States sometimes described as
Americas empty quarter (Garreau, 1981), Colorados economy is not
isolated from the nation. It is sometimes counter-cyclical to the national
economy. It is often subjected to deeper, longer lows and loftier, shorter
highs than the national economy, but it is never beyond the influence
exerted by national economic policies and conditions. As much as the
states economy is swayed by the national economy, it is shaped by
geography.
Located in the western United States, Colorado is one of the those
rectangular states, about 370 miles across from east to west and 280 miles
from north to south. It is the eighth largest state in area and encompasses
about 104,000 square miles (Brunner, 1997, p. 756). In 1990, this space was
occupied by almost 3.3 million people (Brunner, 1997, p. 827). The
combination of great space and not so many people, meant that the state was
ranked 26th in population density with about 32 people per square mile. Of
76


the states east of the Mississippi River, only Maine, with 40 people per
square mile, is close to being as sparsely populated (Brunner, 1997, p. 827).
The eastern half of the state is mostly vast high plains grasslands with
large cattle ranches and grain farms in the uplands and irrigated row-crop
farms in the South Platte and Arkansas river valleys. The central and
southwestern parts of the state are dominated by various ranges of the Rocky
Mountains with 54 peaks reaching heights of more than 14,000 feet. The
western and northwestern parts of the state are characterized by federally
owned land, large sheep ranches, oil and gas fields, and rugged terrain
covered with sagebrush, scrub oak, and short prairie grass.
The principal urban area is a centrally located north-south corridor
along the eastern edge, or Front Range, of the Rocky Mountains with the
cities of Fort Collins on the north and Pueblo on the south. The capital city
of Denver is slightly northeast of the center of the state in this Front Range
corridor.
During the two decades considered by this study, 1975 through 1996,
the national economy experienced a number of business cycle expansions
and recessions (U. S. Department of Commerce, 1994, Table C-51). These
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expansions and contractions of the economy are reflected in the nations
gross domestic product (GDP):29
Figure 4-1
U. S. Gross Domestic Product (GDP) (Real). 1975-96
Source: U. S. Department of Commerce. Survey of Current Business
29 Recessions are formally defined by gross national product (GNP) rather
than by the gross domestic product (GDP). The difference between the two is that
the GNP includes U. S. earnings abroad and the GDP does not; the latter includes
earnings of foreign corporations with operations in the U. S., and the former does
not. Since this study is concerned with the domestic economy, it uses the GDP as
a reflection of the national economy.
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In the early 1970s, before the period of this study, the national
economy began a slide into recession that did not reach bottom until March,
1975. During the period, inflation and unemployment were high with both
over eight percent. For the first time in more than ten years Colorado
suffered a decline in the number of workers employed, but a gradual
improvement was forecast for 1976 and beyond (University of Colorado,
1975, p. 4).
After the recessionary bottom in 1975, the national economy began a
recovery until January, 1980, and Colorado participated. Despite the
expansion, it was a troublesome economic period. The national
unemployment rate declined, but never fell below 5.8 percent and by 1980
was at 7-1 percent (U. S. President, 1998, Table B-42). Inflation rose rapidly
to an annual rate of 13.5 percent in 1980 (U.S. Bureau of Labor Statistics,
1998). Interest rates followed inflation to reach historic highs:
79


Figure 4.2
U. S. Treasury Bill (90-dav) Interest Rates. 1975-96
Soiree Economic Report of the President, 1998, Table B-73.
Although the real GDP grew during the period, the rate of growth
continued to slip, until 1980 when it actually shrank by 0.3 percent from the
prior year (U. S. President, 1998, Table B-4). The 1980 decline lasted only
six months, until July, after which the economy expanded until July, 1981.
The next contraction lasted until November, 1982. The expansion that
80
1996


followed became one of the longest economic expansions in the nations
history.30 Growth was long and steady until July, 1990.
During the decade, the federal budget deficit was a continuing
problem, but the GDP enjoyed positive growth except during 1982. Inflation
slipped from its high of 13.5 percent in 1980 to 1.9 percent in 1986 and rose
only slightly by 1990. Overall, the unemployment rate shrank from more
than nine percent in 1982-83 to a low of 5.3 percent in 1989. Despite the
generally good news, business failures rose rapidly during the early 1980s,
from a low of 40 per ten thousand. By 1986 the rate was 120, but it had
declined to 65 by the end of 1989 (U. S. President, 1998, Table B-96).
During the latter half of the 1980s, Colorados experience was
drastically contrary to the national experience. During the late 1970s and
early 80s, Colorado experienced the latest of its natural resource boom
economic periods.31 The Arab oil embargo and OPEC (Organization of
30 Apparently to be exceeded by the eight-year expansion still continuing
at the end of L998.
31 The gold rush of 1858-59 (Pikes Peak or Bust) and the silver boom of
the 1890s (recall Horace and Baby Doe Tabor) were short lived and were followed
by a bust state economy. Oil exploration companies and entrepreneurs of the
1970s and 80s were only the latest in a line of risk takers to seek their fortune from
the states natural resources.
81


Petroleum Exporting Countries) price fixing of the 1970s may have been a
curse for most of the nation, but for Colorado and a few other oil-producing
states, it was a blessing and an opportunity for immense wealth. Oil wells
that made no sense at less than $20 per barrel, suddenly looked golden at $35
or more. The bubble began to quiver in 1981 when OPECs pricing structure
collapsed and, finally burst in December, 1985 when OPECs members
boosted production to glut levels (U.S. Department of Energy, 1998):
Figure 4-3
U. S. Domestic Crude Oil First Purchase Real Price. 1975-96
Source: U.S. Department of Energy, Energy Information Administration
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Full Text

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JOURNEY FULL CIRCLE: A HISTORICAL ANALYSIS OF KEYES v. SCHOOL DISTRICT NO.1 by Sharon Ruth Brown-Bailey B.A., Princeton University, 1975 M.S.S., University of Colorado, 1980 A thesis submitted to the University of Colorado at Denver in partial fulfillment of the requirements for the degree of Doctor of Philosophy Public Administration 1998

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1998 by Sharon Ruth Brown-Bailey All rights reserved.

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This thesis for the Doctor of Philosophy degree by Sharon Ruth Brown-Bailey has been approved by Lfj.:;
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Bailey, Sharon R. Brown (Ph.D .. Public Administration) Journey Full Circle: A Historical Analysis of Keyes v. School District No.1 Thesis directed by Dr. Marjorie Lewis ABSTRACT Public school desegregation has been one of the most controversial and problematic public policy issues on the American landscape. In the forty-plus years of the history of desegregation litigation, Keyes v. School District No. 1 413 U.S. 189 (1973), is recognized as a landmark case. After twenty years of extensive litigation in the South, Denver became the first Northern desegregation case. This case is also notable as the first case to involve both African-American and Hispanic plaintiffs. The purpose of this historical case study, is to document the history of the Denver desegregation case from its beginnings in the late 1960s, to its dismantling in 1995. Through the methodology of case study, this research provides a retrospective analysis and synthesis of the key events in the cycle of the initiation and dismantling of desegregation in Denver schools. Primary sources of data include court documents, archival records, and newspaper articles. Drafts of the case study have been reviewed by key informants and participants in the case. Within this historical emphasis, a second objective of this study is to examine the impact and relationships between managerial, political, and legal aspects of Denver's desegregation experience. The theoretical framework informing this study, emerges out of the managerial, political, and legal foundations of public administration. The tensions and conflict among these approaches are reflected through the history of this case. Examining desegregation policies and practices through these conceptual lenses, iv

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provides a unique vantage point, and a comprehensive picture of the evolution and dismantling of desegregation in Denver emerges. This study adds to our understanding of a complex history. It reveals why desegregation has been so important, and why it has been so difficult to achieve. Conclusions and policy implications drawn from this case are also discussed. This study reinforces the importance of policymakers, administrators, and community gaining a broader understanding of the multiple factors which can contribute to the success or failure of efforts to achieve equal educational opportunity. This abstract accurately represents the content of the candidate's thesis. I recommend publication. Si v

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DEDICATION AND ACKNOWLEDGEMENTS This work is dedicated to my parents Glenn and Ruth Brown for always encouraging and believing in me. They have given me as much support as any parents could give a daughter, and I have tried my best to make them proud. I also dedicate this study to my husband John and my three sons Mussa, Ra, and Kamau. Your patience with this process will forever be appreciated. With your constant support, I was finally able to complete this protracted journey. You all have helped me in more ways than I can count. Many people had a hand in making this dissertation possible. I have incurred many debts along the way. Thanks to the members of my committee John Buechner, Richard Stillman, Richard Koeppe, and lrv Moskowitz for their insights and commitment to me and the completion of this degree. My deepest thanks to Lewis, the chair of my committee, whose guidance and encouragement helped me to see the value of not giving up on the dream. There are few words to express the debt to my mentor-sister-friend LaFrancis Rodgers Rose, who since my years at Princeton University, has been an angel in disguise. Always gracious in demeanor, but never sparing in criticism, she never let me accept my own excuses. She was able to tap into a reservoir of confidence that I had forgotten existed. And she has always demonstrated by example, the potential I hope to realize. I also wish to acknowledge professors Marshall Kaplan, Franklin James, Lloyd Burton, Peter de leon, and the late Sam Overman of the Graduate School of Public Affairs for their support at crucial junctures. I gratefully acknowledge, the Graduate School of Public Affairs and Norwest Bank for their financial support while I was completing my dissertation. I am also indebted and grateful for the technical assistance provided by Cindy Rundstrom, whose expertise and archival records contributed both to the process and final product. My wish was to paint a scholarly portrait of Denver's experience with the desegregation of its schools. Without the willingness of many individuals who shared with me their personal experiences, this would not have been possible. The insight of attorneys in the case, Michael Jackson and Gordon Greiner has been particularly helpful in understanding this litigative history. And finally, a special tribute to Rachel Noel, who sparked the struggle for desegregation in Denver. Thank you for living and telling your story.

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I CONTENTS CHAPTER INTRODUCTION ................................................................................... ....... 1 I. THE AMERICAN DILEMMA AND EDUCATIONAL OPPORTUNITY : HISTORICAL OVERVIEW ........................................ 5 Separateness in American Society .................................................... S Separate and Unequal Education ..................................................... 11 Brown v. Board of Education Topeka, Kansas ................................. 17 Post-Brown Litigation ........................................................................ 21 II. A PUBLIC ADMINISTRATIVE PERSPECTIVE ON SCHOOL DESEGREGATION: THEORETICAL AND METHODOLOGICAL FRAMEWORK {Literature Review) ................... 29 Public Administration's Conceptual Lenses ..................................... 29 The Managerial Approach to Public Administration .......................... 32 The Management of Public Schools ................................................. 35 The Political Approach to Public Administration .............................. .41 Politics and Public Schools .............................................................. .43 The Legal Approach to Public Administration .................................. .46 The Legal Environment of Public Schools ....................................... .49 Historical Case Study Methodology in Public Administration ........... 52 vii

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Ill. SEGREGATION IN DENVER AND THE EVOLUTION OF THE KEYES CASE ........................................................................ 64 Pre-Keyes Denver and its Schools ................................................... 64 Post-W.W.II Denver and the Expansion of Schools ......................... 69 Evidence of Racial Segregation in Denver Schools ......................... 71 The Politicization of the Board of Education .................................... 77 1966The Berge Study Committee .............................................. 79 The Civil Rights Movement and the Evolution of.. ............................ 80 the Legal Response to Segregation in Denver Schools The Search for a Legal Remedy to Segregation .............................. 89 Denver Schools IV. ELUSIVE EQUALITY: THE STRUGGLE TO IMPLEMENT COURT -ORDERED DESEGREGATION (1973-1983) ......................... 99 The Decision ..................................................................................... 99 Finger Plan: The Initial Remedy 1974-76 ........................................ 107 Response to the Board's Appeal-1Oth Circuit.. ................................ 113 The Politics of Busing ..................................................................... 116 Assignment of the Case to Judge Matsch ........................................ 121 1979-1982: The Search for a Non-Busing Plan .............................. 123 The Ad Hoc Plan ......................................................................... 126 Total Access Plan ....................................................................... 128 Consensus Plan-1982 ................................................................. 131 viii

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V. THE DISMANTLING OF DESEGREGATION IN DENVER (1984-1995) ........ .......................................... .................. 136 A Unitary School District? ................................................................ 136 Shifting Legal and Political Environment.. ....................................... 146 The Interim Decree (1987) ............................................................... 148 The Re-Emergence of the Politics of Desegregation ....................... 153 Black and Hispanic Coalition Attempt to .......................................... 159 Negotiate a Settlement Shifting Legal Doctrine and the Limits of Desegregation .... ...... ..... 161 State Demands End to Racial Busing ............ .................................. 164 Equal Opportunity on Trial. ....... ..................... ........... ...................... 166 The Final Ruling: Court-Ordered Desegregation .... ................... ... 171 Ends in Denver VI. A JOURNEY FULL CIRCLE: DISCUSSION OF FINDINGS AND POLICY IMPLICATIONS ................................ ...................... 181 Focusing the Managerial Lens on Keyes ............ ......... ................... 185 Focusing the Political Lens on Keyes ........... .................................. 193 Focusing the Legal Lens on Keyes ................................................. 200 Policy Implications: Understanding the Past, ................... .............. 208 Exploring the Future Recommendations for Educational Equity in .................................. 211 Post-Keyes Denver ix

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APPENDIX .................................... ................................. ........................ 225 (A) Ethnic Distribution Comparison, 1973 and 1994 ..................... 226 (8) Sample Board Resolutions.Regarding ..................................... 227 Desegregation and Equal Educational Opportunity (C) Post-Keyes Legal Framework ....................... ...... .................... .239 VIII. BIBLIOGRAPHY ............... ....... ......................... .... ........................... 242 X

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INTRODUCTION The purpose of this study is to document the history of the Denver desegregation case, Keyes v. School District No. 1, from its beginnings in the late sixties (1968), to its dismantling in 1995. The questions which motivate this research are: 1.) What has been the impact of Keyes v. School District No. 1? 2.) How have managerial, political, and legal factors affected the overall impact of this case on equal educational opportunity? and 3.) What are the implications of these findings for the future of policy and practice regarding equal educational opportunity? Through the methods of case study research, the researcher presents a "public administrative perspective" from which to describe the significant aspects of Denver's experience with desegregation policy. This framework provides a foundation from which to explore the relationships among the political, legal, and managerial aspects of the case. This perspective also places the historical discussion of Keyes in a context from which to address the above research questions. The Denver Public Schools holds its own in educational history as the landmark Northern desegregation case. Unfortunately, after more than twenty-five years of desegregation efforts, equal educational opportunity remains elusive for many African-American, other ethnic, and poor students. As Denver moves beyond desegregation, there is a critical need to re examine where we've been in order to determine what the future of equal 1

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educational opportunity might require, and possibly to avoid repeating the mistakes of the past. The current climate of reform and legal challenges includes vouchers, charter schools, and privatization as alternative means for achieving equality and quality education for all children. However, even these reforms, cannot escape the historical context of efforts to shape equal educational opportunity in Denver's schools. As Denver and its schools move forward in this uncertain landscape, there is a gap in the public memory and understanding of the full circle of segregation, desegregation, and the resegregation of the Denver schools. A framework is needed which allows community leaders, educators, and parents to understand more fully where we have been, possible lessons learned, and where we might go from here. Desegregation policy researchers have noted the importance of developing and preserving the public memory of our desegregation experiences. Exploring the history of these changes is critical to the future of policy and practice in the post desegregation landscape. The history of any school district, the activities and direction provided by previous school boards and superintendents, is often vague. If the district has no commitment to remembering and understanding its organizational history, that history is dependent upon word of mouth. The ever-changing nature of school boards with frequent elections results in a situation where there is little or no institutional or community memory, especially among those who are in a position to make a difference. In the Denver case, as with others, the history of these issues is often relegated to the archives. There have been only a handful of studies 2

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of the history of desegregation in Denver. None to date has examined this history in light of the recent movement to return to the resegregation that neighborhood schools create. The timeliness of this study is also important, because Denver and its schools are at a unique turning point, a point at which a backward glance may be useful. The vision of Brown and Keyes should not be lost. This study provides a retrospective analysis and synthesis of the events of the cycle of segregation-desegregation-resegregation of the Denver schools. Such historical information has value for current and future board members, administrators, teachers, and staff within the district, as they attempt to meet the challenge of providing equity and quality in future educational policy and practice. The goal of providing students, even in segregated environments, with equitable and quality education cannot be isolated from the historical context of these issues. The changing landscape will require school leadership and community to be conscious of this history, its issues and lessons, in order not to repeat the mistakes of the past. The value of this study is not restricted to those who are in Denver or the Denver Public Schools. One district's history may serve as a source of information for other districts either as a guide or a warning. The first chapter places the Keyes case in the historical context of this nation's struggle with issues related to race, separatism, and unequal educational opportunity. This chapter relates the problem of separate and unequal education, and how it sparked the movement to desegregate America's public schools. In the second chapter the writer defines a "public 3

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administrative framework," as the theoretical grounding through which the history of Keyes will be examined. In this framework, the managerial, political, and legal lenses provide a different vantage point from which to assess the impact of this case on Denver's schools and community. Chapters Three, Four, and Five describe the history of Denver's desegregation experience through the managerial, political, and legal lenses provided by three of public administration's conceptual lenses. Finally, in Chapter Six, these conceptual lenses are and focused on the implications of this history, as the writer discusses conclusions and policy implications for the future of equal educational opportunity in Denver. 4

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CHAPTER I THE AMERICAN DILEMMA AND EDUCATIONAL OPPORTUNITY: HISTORICAL OVERVIEW Throughout America's history, racial issues have been among, if not central to, the country's most important concerns. Often-as when the Constitution was written, during the Civil War and Reconstruction, and throughout the decades of the civil rights movement, and since the Supreme Court's Brown decision in 1954-racial issues have riveted attention (Bell 1987:4 ). Separateness in American Society Racial issues have been central in shaping the history of the nation. The racial matters which emerged with the legacy of slavery have stamped their signature on each historical era up to the present day. Controversy regarding superiority and inferiority of the races, hostility and separatism have been the core residuals of this preoccupation. The legacy of racism and separatism left its mark on many aspects of the struggle of blacks for freedom, including education and literacy. The denial of rights and opportunities to an education for African Americans has been inextricably tied to the political, economic, and social life of the country. Carter Woodson (1919: i) observed in The Education of the Negro Prior to 1981 that: One can trace the waning of early liberal tendencies toward the education of the Negroes as the slave system evolved, followed by a brief upsurge in Negro education when the progressive trends of the American Revolution coincided with a temporary 5

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decline in the economic value of slavery. One can see the harsh supression of Negro education with the resurgence and expansion of slave power during the first half of the 19th century, and observe white churchmen and statesmen shifting from positive to negative attitudes regarding Negro education with the fluctuations in the political influences of the time. Education for Woodson (1919:i), is a "dependant, inter-acting unit of the whole culture. Indeed, it lies at the heart of culture, and necessarily reflects the contending values which prevail at the time." Throughout the early history of the nation there were those among abolishionists and philanthropists who held a different view on the suppression of education for those of African descent. The individual strivings of the likes of Benjiman Banneker, Phyliss Wheatley, and Frederick Douglas represent the efforts of many blacks to secure education despite the barriers established by the dominant culture. Writing in 1944, the Swedish economist Gunnar Myrdal observed that the United States was and is beset by an apparent paradox. The nation's commitment to universal justice and equality are contradicted by the way it treats its principal minority race. Myrdal termed this conflict between the professed ideals of the American people and the reality of our behavior in race relations An American Dilemma. A more contemporary analyst of race and American culture, Andrew Hacker (1994:4) finds that "America is inherently a 'white' country; in character, in structure, and culture. Needless to say, black Americans create lives of their own. Yet, as a people, they face boundaries and constrictions set by the white majority." 6

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In 17 40, South Carolina enacted a law prohibiting any person "from teaching or causing a slave to be taught, or from employing or using a slave as a scribe in any manner or writing" (Woodson 1916:34). This practice was followed throughout the South until Emancipation. Slavery was a foremost concern for the delegates to the Constitutional Convention in 1787 as the founders declared in a provision of the Constitution that slaves were to be counted as "three fifths" of a person for taxation and representation. John Hope Franklin observes that "when the capitol of the United States was established in Washington in 1801, they passed a law so blacks could not vote, could not hold office and could not even carry the mail. Those bills were signed by Thomas Jefferson, who had written the Declaration of Independence, and by the Congress, many of whom had been members of the Constitutional Convention.Q (Matthews' interview 1994: 16). The state of Ohio in 1807 excluded African Americans from residence in the state unless they posted a $500 bond for good behavior (Gerber 1981: 3). In 1850, the Fugitive Slave Act was passed, which made the national and state governments responsible for the capture and return of runaway slaves. In 1857, the Supreme Court described black Americans in the Dred Scott decision as a class of persons who were regarded as being of an inferior order, and altogether unfit to associate with the white race, either in social or political relations; and so far inferior, that they had no rights which the white man was bound to respect (Dred Scott v. Sanford 60 U.S. 393). Anderson (1995: 25) maintains that, "the Dred Scott decision was ... the culmination of a long-standing drift away from the natural rights philosophy 7

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that seemed so apparent in the Declaration of Independence. It was 'all men' and not a race or color that were placed under the protection of the Declaration." The leaders of the nation, from the early national era through the ante-bellum period, rejected this egalitarian reading of natural rights philosophy, and modified the philosophy to claim only rights derived from white property owning citizenship. In 1857, the United States Congress admitted Oregon to the union as the only free state with a black exclusion clause in its original Constitution. Oregon demanded that all free persons of color leave the state and subjected those who stayed to periodic floggings and later made them servants to whites (Berwanger 1967 : 94). The end of the Civil War and the Emancipation Proclamation brought hope to Blacks that they would begin to enjoy the fruits and rewards of freedom previously denied them Hope was further heightened when the 13th Amendment, proposed on February 1865 and ratified in December 1865, officially terminated slavery in the United States The 14th Amendment gave blacks citizenship and due process, while the 15th Amendment gave blacks the right to vote. Blacks believed that these amendments would end the debate over slavery. However, even the great emancipator, Lincoln. said that," while he opposed the enslavement of human beings, he did not view the Africans as equals." (Coombs 1972:84). Despite these developments, the ingrained beliefs regarding the inferiority of blacks would continue to shape barriers to securing the rights and privileges enjoyed by the majority population. Black hope and optimism were short lived as the Southern states quickly enacted the infamous Black 8

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Codes that substantially restricted the newly gained freedom of the ex slaves. The Black Codes differed from state to state. Provisions of various codes resulted in blacks not being allowed to enter a town without a permit, to own firearms, to purchase land within city limits, and adhere to curfews. Within the legal and political systems, blacks could serve as witnesses in court only when against other blacks, were required to pay a poll tax to vote, understand complicated passages of the Constitution, and were subjected to grandfather clauses. Some even maintain that white South Africa based its system of apartheid on the Black Codes of America. Thirty-one years after slavery was abolished, the South's movement into two separate societies-one black, one white was officially sanctioned by the Supreme Court in Plessy v. Ferguson, 60 U.S. 393 (1896). This decision was in response to a Louisiana law passed in 1890 that required railway companies carrying passengers to have separate-but-equal accommodations for whites and blacks. Plessy, who was one-eighth black protested that the 14th Amendment forbade racial segregation on railroad cars. The Court rejected the argument of Plessy that to be forced to ride in separate railroad cars stamped him "with a badge of inferiority". In disagreeing with Plessy, the Court upheld the doctrine of separate but equal. By a seven to one margin, the Justices of the Supreme Court agreed that separate but equal public facilities did not violate the equal protection clause of the Constitution, and that the Amendment could not have been intended to abolish distinctions based on color or to require a commingling of the two 9

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races upon terms unsatisfactory to either. Justice Henry Brown wrote the majority opinion: When the government, therefore, has secured to each of its citizens equal rights before the law and equal opportunities for improvement and progress, it has accomplished the end for which it is organized and performed all of the functions respecting social advantages with which it is endowed. Legislation is powerless to eradicate racial instincts or to abolish distinctions based upon physical differences, and the attempt to do so can only result in accentuating the difficulties of the present situation. If the civil and political rights of both races be equal one cannot be inferior to the other civilly or politically. If one race be inferior to the other socially, the Constitution of the United States cannot put them on the same plane (Piessy v. Ferguson, 163 U.S. 537(1896). This ruling led the way for "Jim Crow" laws that required the separation of blacks and whites in almost every realm of life; in schools, housing, jobs, public accommodations, cemeteries, and hospitals. In courts of law separate Bibles were used for black and white witnesses. In public places, white and "colored" signs designated which restrooms and water fountains were to be used. Blacks were allowed in public parks only on "colored day". Blacks were forced to sit in the rear of streetcars and buses. In restaurants, blacks could buy food only by entering a back door and then leaving to eat outside. The "separate but equaln doctrine in Plessy was used to justify two societies in America-one white and one black. The law supported racial segregation, legitimized educational apartheid and institutional duality, re-instated the traditions of white supremacy with black inferiority, and structured privilege based on the color of ones skin. 10

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With the oppressive conditions of the South, more than 800 black men were lynched between 1901 and 191 0. Blacks begin to leave the farms and move to the larger Southern cities. Race riots started as early as 1906 in Atlanta, Georgia. The worst race riots in the history of the country took place in the summer of 1917 in East St. Louis, Missouri; Charleston, South Carolina; Longview, Texas; Washington, D C.; Chicago, Illinois; and Omaha, Nebraska (Franklin 1956:432,436). Threats of violence and the promise of industrialization of the North, fueled black migration from the South. Separate and Unequal Education The elusive nature of equal education for African Americans is woven into the story of the larger failure of American society to make emancipation real. State and local governments maintained that it was the status of citizenship that entitled one to public education. Because blacks were not citizens, they were not entitled to the benefi ts of public education In free states during the pre-Civil War years, there was almost universal denial of public education to black children. After the Civil War, four million slaves were emancipated. Ninety percent of them lived in the former slave states, and more than ninety percent of them were illiterate. By 1900, only half of southern blacks claimed to be literate (Margo 1990: 9). Racial separation of blacks and whites in public education had long been institutionalized throughout the United States, in both the North and the South. uln 1865, all urban areas segregated African American children into separate and unequal schools, and most rural districts refused to admit 11

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them to 'white' public schools and failed to establish separate schoolsn (Anderson 1995: 29). Using Plessy v. Ferguson (1896), segregated education became the status quo. The disparity between expenditures for black and white schools clearly demonstrated that separate did not necessarily mean equal. In one South Carolina County, as late as 1932, $8 was spent on each black student in the public schools, while $178 was spent for each white student. Separate and unequal schools meant the black teachers were paid less, facilities for black schools were substandard. Black students also had teachers with less qualifications than white students. In the 1930's, more than one-third of the black teachers in 15 southern states had not complete high school. As late as 1950, separate educational facilities were required by law for black and white students in twenty-one states and in the District of Columbia Blacks were excluded from high school education in the South On the eve of World War II, 77% of the black high school aged population was not even enrolled in public secondary schools. As late as 1950, more than two-thirds of this population were not enrolled in public high school. The reverse was true for whites (Anderson 1995 : 35) Utilizing its constitutional authority, the Supreme Court upheld the doctrine of separate but equal in public education following the Plessy decision. In Cumming v. Richmond County Board of Education 175 U.S. 528 (1899), black taxpayers sought an injunction requiring the school board to discontinue the operation of a white high school until it resumed the operation of a high school for black children. The Justices, however, 12

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. I allowed the school board to close the black high school, (so those affected had no high school to attend), and keep the white high school open. The separate but equal doctrine itself, however, was not challenged. The Justices ruled similarly in Gong Lum v. Rice, 275 U.S. 78 (1927), as the plaintiff, the father of a child of Chinese descent argued that state authorities misapplied the separate but equal doctrine by classifying his daughter with black children and therefore requiring her to attend a black school. The court would not intervene on behalf of Lum's daughter. Again, the doctrine itself was not challenged directly (Fife.1997:5). The NAACP began to challenge the constitutional validity of segregation in education in the years leading up to the Brown decision. Between 1938 and 1950, four major cases brought by the NAACP reached the Supreme Court of the United States. These cases dealt with graduate level education (Missouri ex ref. Gaines v. Canada, Sipuel v. University of Oklahoma, Sweatt v. Painter, and McLaurin v. Oklahoma State Regents). In Gaines (1938), the Court ruled that the state of Missouri had to provide blacks with a legal education on par with whites. The state offered to pay the black students tuition at an out of state law school that accepted blacks, but the Court said that this wasn't enough and that equal accommodations had to be provided within the state. In 1948, with Sipuel v. Board of Regents, Ada Sipuel, a black woman who applied to the only law school in the state at the University of Oklahoma was denied admission. Her application was denied because a separate law school for blacks with "substantially equal" facilities would soon be opened. The Court ordered 13

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the university to admit Sipuel, open up a separate law school for her, or suspend the white law school until it opened one for blacks. The Oklahoma Board of Regents quickly created a separate law school by ordering a small section of the state capital in Oklahoma city to be roped off for black students. Three law teachers were assigned to Sipuel and other blacks in her situation. This action by the Board of Regents rendered a great protest, and Thurgood Marshall brought the case back to the Supreme Court. He argued that the Regents had defiled the Court's mandate, but the Justices did not agree. The Court ruled that the Regents had not acted in defiance of the Court's earlier decision (Fife 1997:6). By 1950, the Supreme Court was required to address the intangibles of graduate education that could not be achieved within the separate but equal doctrine The facts in Sweatt (1950) were similar to those in the case of Sipuel. Herman Marion Sweatt was a black letter carrier who wanted to attend the all-white University of Texas Law School in Austin. As with Sipuel, he was rejected on racial grounds. Like the Regents in Oklahoma, officials in Texas attempted to create a makeshift law school for blacks, first at Prairie View University, and then at the Texas State University for Negroes at Austin. Marshall represented Sweatt and attempted to persuade the Justices to review the original Plessy decision in their deliberations A unanimous Court ordered that Sweatt be admitted to the University of Texas Law School, and that the state could not provide black students with equal educational opportunity in a separate law school. This was a first, and the Court did so on the grounds that the black law school created by Texas 14

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officials had failed to provide equal educational opportunity. Much to Marshall's chagrin, however, the Court did so without reviewing Plessy. The separate but equal doctrine was still the law of the land. McLaurin v. Oklahoma State Regents was also decided in 1950. George Mclaurin applied to the University of Oklahoma to earn a doctorate in education in 1948. His application was rejected on racial grounds. After McLaurin initiated litigation, a federal district court ordered the state to provide equal educational opportunity. The state responded by permitting McLaurin to enroll in the University of Oklahoma, but the instruction had to be on a segregated basis within the university. He could not sit in regular classrooms, eat at the same time with white students in the cafeteria, and was assigned a segregated desk in the library behind the newspapers. Marshall and the NAACP represented him and took the case to the Supreme Court. Prior to the case being heard by the Supreme Court, Oklahoma officials modified their segregation practices by allowing McLaurin to be admitted into the same classroom with white students. His assigned seat, however, was surrounded by a railing labeled "Reserved for Colored". McLaurin had to sit in a unmarked row by himself, sit at a table designated for him in the library, eat at his own table, though he could now dine at the same time as the white students. The restrictions were humiliating in the highest magnitude. Clearly the Oklahoma officials were attempting to send a strong message to black students interested in graduate education. McLaurin also posed a dilemma. Unlike the preceding cases dealing with graduate education, McLaurin had not been denied equal educational 15

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facilities, at least in terms of measurable factors such as faculty, curriculum, and the availability of library and other resources. The true issue was the stigma of segregation itself. Although the Justices were not willing to review the Plessy rule, they determined that the restrictions forced on Mclaurin were inequalities and had to end. Chief Justice Fred Vinson, Jr. declared: Our society grows increasingly complex, and our need for trained leaders increases correspondingly. Appellant's case represents, perhaps, the epitome of that need, for he is attempting to obtain an advanced degree in education, to become, by definition, a leader and trainer of others. Those who will come under his guidance and influence must be directly affected by the education he receives. Their own education and development will necessarily suffer to the extent that his training is unequal to that of his classmates. State imposed restrictions, which produce such inequalities, cannot be sustained. McLaurin v. Oklahoma State Regents, 339 U.S. 637 (1950). In the Sweatt and McLaurin cases, the Court found that there were qualities which were incapable of objective measurement but which make for greatness in law and other graduate education. Interactions with quality faculty, for example, were among the 'intangible' considerations indispensable to equal educational opportunity. These cases laid the foundation for direct challenge to the concept of "separate but equal' education Taking on these graduate level cases was a conscious strategy of the NAACP to build the case for the challenge of separate but equal at the lower levels of schooling in American public education. 16

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Brown v. Board of Education of Topeka Kansas Marshall and other NAACP lawyers faced a difficult challenge following the Court's decisions in 1950. On one hand, if the Court could not be forced to confront the legality of segregation itself, NAACP lawyers would have to argue cases alleging unequal educational facilities one by one for an undetermined amount of time. Segregation would therefore continue. On the other hand, the Justices could decide to review Plessy and affirm it, thus reinforcing segregation as the law of the land. A series of ensuing cases, however, all listed under Brown v. Board of Education of Topeka, Kansas, would resolve this dilemma. The Brown case was a consolidation of four cases involving school segregation in four states: Kansas, Delaware, Virginia, and South Carolina. All involved black children who were denied admission to public schools attended by white children under state laws either requiring or permitting segregation. The cases were handled by the NAACP Legal Defense Fund, which had previously attacked segregation in higher education and now turned its attention to the elementary and secondary education that directly affected all black children. In a unanimous opinion, the Supreme Court ruled that public school, legally compelled, segregation of students by race is a deprivation of the equal protection clause guaranteed by the 14th Amendment of the U.S. Constitution. uBrown was the most sweeping of a series of decisions affirming that black Americans are to feel that the United States is truly their country, and that doors cannot be shut to them simply because of their 17

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color." (Hacker 1992: 161). The most crucial question in the case was: Does segregation of children in public schools solely on the basis of race, even though the physical facilities and other "tangible" factors may be equal, deprive the children of the minority group of equal educational opportunities? The Court answered the question in the affirmative. The ruling in Plessy had been reversed after fifty years. Justice Warren declared that: We conclude that in the field of public education the doctrine of'separate but equal has no place. Separate educational facilities are inherently unequal. Therefore, we hold that the plaintiffs and others similarly situated for whom the actions have been brought are, by reason of the segregation complained of, deprived of the equal protection of the laws guaranteed by the Fourteenth Amendment. (Brown v. Board of Education of Topeka, Kansas (Brown I), 347 US. 483 (1954). The Justices further emphasized the importance of equal opportunity in education for the maintenance of a democratic society: Today, education is perhaps the most important function of state and local governments. Compulsory school attendance laws and the great expenditures for education both demonstrate our recognition of the importance of education to our democratic society. It is required in the performance of our most basic public responsibilities, even service in the armed forces. It is the very foundation of good citizenship. Today it is a principal instrument in awakening the child to the cultural values, in preparing him for later professional training, and in helping him to adjust' normally to his environment, In these days, it is doubtful that any child may reasonably be expected to succeed in life if he is denied the opportunity of an education. Such an opportunity, where the 18

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state has undertaken to provide it is a right, which must be made available to all on equal terms (/d., at. 483). The message of Brown was that black Americans were full citizens as a principle of constitutional law, and that the end of an oppressive era whose roots are over three hundred years old, had finally arrived. To blacks, 1954 was the "year of jubilee," fifty-eight years overdue since P/essy v. Ferguson in 1896, ninety-one years overdue since the Emancipation Proclamation in 1863, and two hundred ninety-three years overdue since blacks were reduced to slavery in America in 1661 (US Commission on Civil Rights 1975: 29). There were, in fact, two Brown decisions. The 1954 case or Brown I, as it is called, declared segregation unconstitutional, but no remedies were fashioned. After argument was heard on a number of issues, the Court, in 1955, declared a second opinion commonly called Brown II, 349 U.S. 294 (1955). "All deliberate speed", is the most memorable language of the second Brown ruling. Some scholars have argued that this dictum took much of the steam out of the desegregation litigation as state and local officials rushed to create ineffectual plans, many of which included busing." (Phillips 1994:11 ). Despite the declaration that desegregation should be carried out "with all deliberate speed", both Southern and Northern school officials became experts in tactics of avoiding or delaying compliance with this controversial law. The resistance to desegregation created a snail's pace for compliance with desegregation orders. In 1956, the 'Southern 19

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Manifesto' was endorsed by nearly every elected senator and legislator from the Southern states. The supporters of the manifesto pledged "to use all lawful means to bring about a reversal of this decision and to prevent the use of force in its implementation." (Coombes 1972:192). Many felt that the mandate to desegregate public schools was an overstepping of judicial authority and contrary to the Constitution. It became clear with the Brown II guidelines, that many school officials largely ignored the Court's ruling. Dual systems remained prevalent across the country, years after the Court's landmark directives. Segregation continued over the next decade under freedom-of-choice plans, transfer programs for white students to majority white schools, the closing of public schools, and the provision of tuition grants and other aide to white segregated schools. The most defiant national case against school desegregation was the Little Rock, Arkansas case. The Little Rock school board, complying with the Supreme Court's direction, had announced a plan for gradual desegregation, beginning with their senior high school in the fall of 1957. Governor Faubus ordered the Arkansas National Guard to prevent the nine black children from entering the school. The children came on September 3rd, and were turned away. White mobs came to the school. The state legislature closed all high schools in September 1958, only to have them declared reopened by a federal court. Federal troops were used for the first time in the history of America to enforce school desegregation in Little Rock. 20

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Post-Brown Desegregation Litigation The Supreme Court has handed down many desegregation rulings in the more than forty years that have passed since the original Brown ruling. The implementation of desegregation orders required a "good faith" effort on the part of school officials in their transformation from dual to unitary school systems. The Supreme Court delegated the oversight responsibility to the federal courts, because of their proximity to local conditions and the possible need for further hearings. It was felt that the courts, which had originally heard these cases, could best perform the necessary judicial appraisal of the desegregation efforts of local school districts. Black plaintiffs had to return to the courts throughout the country repeatedly in their attempts to secure the implementation of Brown and its progeny. In Prince Edward County, Virginia, for example, rather than desegregate, officials decided to close all of its public schools and subsidize private school tuition for white students until the Supreme Court stepped in again. In 1964, the Supreme Court ruled that the closing of these public schools denied equal protection of the law for black children. A decade after the Brown decision, only 1.2 percent of black students in eleven Southern states attended schools with whites (Orfield and Eaton 1996:vii). To encourage compliance with these orders, the Civil Rights Act of 1964 included a provision to withhold moneys from school districts that did not desegregate. This Act outlawed discrimination in federally funded programs and gave the US Department of Justice the authority to bring school desegregation lawsuits. This federal pressure did encourage some 21

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compliance with the law. By 1968, 32 percent of all black students in the South attended schools with white students.(Orfield and Eaton 1996:vii). The progress, however, slowed again when the emphasis on Federal enforcement shifted with the anti-busing policies of the Nixon adminrstration. In 1969, there was a movement away from the administrative fund cut off requirement, a weakening of the enforcement powers of the Department of Justice, and return to the political burden of the desegregation of public schools to the courts. After more than a decade of resistance and delay on the part of the defendant Southern school districts, desegregation rulings began to reflect the frustration of the judiciary, as the Courts began to fashion more stringent guidelines for the implementation of these orders. There were several cases, which emerged in the late 1960s and early 1970s, which would reshape the desegregation landscape. In Green v. County Board of New Kent County, Virginia, 392 U.S. 430 (1968), a unanimous Court virtually ended the use of freedom of choice plans. In this case, the school board plan to supposedly comply with the Brown ruling implemented a freedom of choice plan. In this rural district in Eastern Virginia de facto segregation was not present, because both blacks and whites resided throughout the county. The school system had only two schools (the New Kent school on the east side of the county was a combined white elementary and high school; the George W. Watkins school was a combined black elementary and high school). Students could attend either school under this plan. After three years of operation, however, no white students participated in the plan and freely chose not to attend the majority 22

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black Watkins school. One hundred and fifteen black children did exercise their choice to enroll in New Kent in 1967, but eighty-five percent of the black children remained in Watkins. Justice William Brennan wrote the opinion for a unanimous Court: [l]n desegregating a dual system a plan utilizing "freedom of choice" is not an end in itself. Where it offers real promise of aiding a desegregation program to effectuate conversion of a state-imposed dual system to a unitary, non-racial system there might be no objection to allowing such a devise to prove itself in operation. On the other hand, if there are reasonably available other ways, such for illustration zoning, promising speedier more effective conversion to a unitary, non-racial school system, "freedom of choice" must be held unacceptable (/d., at 430). The volatile issue of busing as a remedy for segregation was addressed in the case Swann v. Charlotte-Mecklenberg Board of Education, 402 U.S.1 (1971 ). Swann dealt with the constitutionality of several differing desegregation techniques including zoning and transfer options. In a unanimous opinion, the Court approved a comprehensive desegregation plan while holding that bus transportation is "a moral and accepted tool of educational policy", and that desegregation plans cannot be limited to the walk-in school. Four important rulings emerged from the Swann case. Federal district courts could decree as tools of desegregation the following: 1.) reasonable bus transportation; 2.) reasonable grouping of noncontiguous zones; 3.) the reasonable movement toward the elimination of one-race schools, and 4.) the use of mathematical ratios of blacks and 23

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whites in the schools as a starting point toward racial desegregation (Fife 1997:12). Just as Green and Swann began to provide some definition and clearer guidelines for desegregation school districts, the Detroit case Milliken v. Bradley, 48 U.S. 717 (1974), would provide limitations that would ultimately restrict the future of desegregation efforts throughout the nation. This divisive case was decided by a five to four vote, and reflected the growing chasm at the Supreme Court level regarding the increasingly volatile issues surrounding desegregation, and the use of busing as a remedy in particular. A class action suit was initiated by black students and the Detroit branch of the NAACP against Michigan Governor William Milliken, the State Board of Education, Detroit's school board and superintendent, and other state officials, alleging racial segregation in the Detroit public schools. The federal district court ruled for Bradley and the other black students. The school board was ordered to formulate desegregation plans for the city school district; state officials were directed to devise plans for a metropolitan unitary system involving three counties. Eighty-five school districts were required to participate by the lower court, even though de jure segregation was not evident in these areas. The court appointed a panel to devise a regional desegregation plan which was to include fifty-three of the eighty-five suburban districts. It also ordered the Detroit public school system to purchase 295 buses for transportation purposes. The court of appeals affirmed the district court's ruling, but remanded the case for more extensive hearings involving the suburban 24

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districts. It also tentatively rescinded the purchase order of the additional school buses (Fife 1997:14). The Supreme Court eventually reversed the lower decisions, and many pro-desegregationists still lament this ruling more than twenty years after the fact. Milliken remains a significant precedent in American jurisprudence regarding desegregation. In this case, court limited the extent of desegregation by deciding that the white children in suburban Detroit could not be forced to cross district lines to attend schools in the predominantly black Detroit public schools. Unfortunately, the only way to solve the problems of Detroit schools seemed to be to create a metropolitan district (Watras, 1997: 37). With this case, the Justices limited the scope of public school desegregation to only those districts that have demonstrated de jure segregation. The focus, and indeed the public discourse concerning school desegregation, still lies on single school districts. Because of the prevailing residential patterns over the past thirty years or so, this means that school desegregation has largely remained an urban phenomenon, and suburban America has been excluded to a considerable extent (Alexander and Alexander 1980; Fife 1997). The Court stated that the school board's obligation is to produce only that level of integration possible through within district busing. This limitation by the Court was later viewed by many as encouraging heightened anti-busing sentiments and the increase of "white flight" to the suburbs from desegregating districts throughout the nation. This chapter has explored the historical context of the American dilemma of race and separatism as it relates to school desegregation. The 25

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Supreme Court was forced to challenge the "separate but equal doctrine in education in its Brown decisions. Unfortunately, the resistance, delay tactics, and traditions of separateness eventually undermined the mandates of the courts. The passage of time would demonstrate that the Supreme Court was not immune to the political climate and tensions of its desegregation decisions (Spann 1993; Berry 1994). The Justices put forth powerful statements regarding equal educational opportunity in the Green and Swann cases, only to begin a reversal of its vision and commitment with subsequent rulings. {Milliken v. Bradley (1977), Dowell v. Board of Education (1991 ), Freeman v. Pitts (1992)]. The focus of this study, Keyes v. School District No. 1, emerged against the political and legal context of the nation's two decade struggle with desegregation and the provision of equal educational opportunity. The next chapter will present the theoretical and methodological framework of this case study. Defined as a "public administrative" perspective, the framework provides legal, political, and managerial lenses which are then focused on the policy issue of public school desegregation. It is from the prism of these three lenses, that the data regarding Denver's desegregation experience will be presented and analyzed. 26

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REFERENCES: CHAPTERI Alexander, Kern and M. David Alexander. 1985. American Public School Law. St. Paul: West Publishing Co. Anderson, James D. 1995: Literacy and Education in the African-American Experience". In Vivian Gadsen and Daniel Wagner, eds. Literacy Among African American Youth. Cresskill, NJ: Hampton Press, Inc.: 25, 29, 35. Bell, Derrick. 1987. And We Are Not Saved: The Elusive Quest for Racial Justice. New York: Basic Books: 4. Berry, Mary Francis. 1994. Black Resistance/ White Law: A History of Constitutional Racism in America. New York: Penguin Books. Berwanger, E.H. 1967. The Frontier Against Slavery: Western Anti-Negro Prejudice and the Slavery Extension Controversy. Urbana: University of Illinois Press: 94-95. Fife, Brian L. 1997. School Desegregation in the Twenty-First Century: The Focus Must Change. Lewiston, New York: The Edwin Mellen Press: 5, 6., 12, 14, 15. Franklin, John Hope. 1956. From Slavery to Freedom: A History of American Negroes. New York: Knopf: 432,436. Coombs, Norman. 1972. The Black Experience in America. New York: Twayne Publishers, Inc.: 84, 192. Gerber, D. A. 1981. Black Ohio and the Color Line. Chicago: University of Chicago Press: 3. Hacker, Andrew. 1992. Two Nations: Black and White, Separate and Unequal. New York: Ballintine Books: 4, 161. Margo, R. A. 1998. Race and Schooling in the South, 1880-1950. Chicago: University of Chicago Press: 9. Matthews, Frank L. 1994. The Genius of John Hope Franklin: America's True Great Historian".[lnterview]. Black Issues in Higher Education. vol. 10, no. 3:16. Myrdal, Gunnar. 1944. The American Dilemma: New York: Harper. 27

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Orfield, Gary and Susan E. Eaton. 1996. Dismantling Desegregation: The Quiet Reversal of Brown v. Board of Education. New York: W. W. Norton and Co: vii. Phillips, Mary Christine. 1994. "Brown At Forty: Reassessing the Case that Changed Public Education in the U.S". Black Issues in Higher Education. Vol. 19, No. 23: 11. Spann, Girardeau. 1993. Race Against the Court: The Supreme Court and Minorities in Contemporary America. New York: New York University Press. U.S. Commission on Civil Rights, 1975. Twenty Years After Brown. Washington, D.C.: U.S. Commission on Civil Rights: 29. Watras, Joseph. 1997. Politics, Race, and Schools: Racial Integration, 19541994. New York: Garland Publishing: 37. Woodson, Carter G. 1919. The Education of the Negro Prior to 1861. Washington D.C.: The Associated Publishers: I, 34. Cases Dred Scott v. Sanford, 60 U.S. 393, 407(1857). P/essy v. Ferguson, 163 U.S. 537 (1896). Cumming v. County Board of Education, 175 U.S. 528 (1899). Gong Lum v. Rice, 275 U.S. 78 ( 1927). Missouri ex ref. Gaines v. Canada, 305 U.S.337 (1938). Sipuel v. University of Oklahoma, 332 U.S. 631 (1948). Sweatt v. Painter, 339 U.S. 629 (1950). McLaurin v. Oklahoma State Regents, 339 U.S. 637 (1950). Brown v. Board of Education of Topeka (Brown 1), 347 U.S. 483 (1954). Brown v. Board of Education (Brown II), 349 U.S. 294 (1955). Green v. County School Board of New Kent County, 391 U.S. 430 (1968). Swann v. Charlotte-Mecklenberg Board of Education, 402 U.S. I (1971). Milliken v. Bradley, 48 U.S. 717 (1974). Board of Education v. Dowell, 498 U.S. 237 (1991). Freeman v. Pitts, 503 U.S. 467 (1992). Other Articles of Confederation 1787 Art. 1, Section 2 28

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CHAPTER II A PUBLIC ADMINISTRATIVE PERSPECTIVE ON SCHOOL DESEGREGATION: THEORETICAL AND METHODOLOGICAL FRAMEWORK A broad overview of the history and future of school desegre gation requires a range of analytic lenses. Desegregation is at once a matter of constitutional law, federal and local politics, individual psychology, demography, teaching techniques, and liberal democratic ideas. Looking at desegregation through only some of these lenses give a partial and distorted view. Thus, the analysis must range from the legal meaning of Brown to patterns of black suburbanization. Different lenses yield different, and even contradictory images of school desegregation. If we can understand these partial views and contradictions, we will go a long way toward understanding why desegregation is both so important and so difficult to achieve" (Hochschild, 1985:1 ). (Emphasis added). Public Administration's Conceptual Lenses Hochschild's perception of the multiple lenses required to understand the complexity of the issues embedded in the policies and practices of public school desegregation is well-founded. The field or discipline of public administration can serve the analysis of school desegregation in a manner which reveals a number of the analytical lenses required to understand the 29

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Public administration has been defined in varied ways over its evolution. Because public administration means different things to different observers, and lacks a significant theoretical or applied meaning, some have argued that there is no discipline or field of public administration, per se. Others argue that the diversity of the field reflects its strength (Waldo 1956; Stillman 1991 ). The study of public administration overlaps a number of other disciplines including political science, sociology, administrative law, economics, psychology, and business administration. The multidisciplinary nature of public administration does present difficulties when attempting to carve out a simple definition, but the advantage of its multiple lenses has served to shed light on many significant areas of public policy. In an early review of the traditional models used in public administration, Dwight Waldo (1956:29) suggests that the multiple perspectives of the field can be uniquely useful. In a discussion of the pluralistic nature of contemporary public administration Stillman (1991 :12) observes that, "No one theory or two, say the advocates of this school, can realistically explain contemporary public administration thought. The pluralist philosophy holds that diversity of opinions and points of view is not only an appropriate way to explain present reality it is also a positive strength." The positive strength of public administration's diverse origins and approaches is demonstrated in David Rosenbloom's (1986:6) integration of three distinct underlying approaches to the field which grow out of different perspectives on its functions. The following definition summarizes this "perspectivist" approach to public administration: 30

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Public administration is the use of managerial, political, and legal theories and processes to fulfill legislative, executive, and judicial governmental mandates for the provision of regulatory and service function for the society as a whole or for some segments of it. Some have viewed public administration as a managerial endeavor similar to practices in the private sector (Wilson 1887; White 1926; Gulick and Urwick 1937). Others, stressing the "publicness" of administration have emphasized its political aspects ( Appleby 1949; Long 1949; Waldo 1956; Downs 1967). Still others, noting the importance of sovereignty, the constitution and regulation in public administration have viewed public administration as distinctly a legal matter (Goodnow 1905; Davis 1975; Dimock 1980). For years, the tendency of scholars and practitioners has been to stress one or another of these approaches. This, according to Rosenbloom, has promoted confusion since each approach tends to emphasize different values, different organizational arrangements, and radically different views of the individual citizen (Rosenbloom, 1986:4 ). In understanding public administration, it is important to understand the view from each of these lenses, as well as their interrelationships. Although the origins, definitions, and perspectives on pubiic administration are many, to focus and limit this study, Rosenbloom's three lenses or approaches to public administration and the interactions among them will provide the foundation of the theoretical framework. The remainder of this chapter will examine these three lenses, and then focus 31

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them on the governance and administration of the public schools. The influence of these conceptual lenses on desegregation policy is also discussed. These three perspectives lenses are particularly helpful in understanding the policies and practices of public school desegregation. As this case study of Keyes v. School District No 1. unfolds, the researcher demonstrates how the managerial, legal, and political lenses of public administration can be applied to the analysis of desegregation policy. The "public administrative perspective" on public school desegregation provides a theoretical framework and an insightful vantage point from which to examine its impact on the schools, the community, and the provision of equal educational opportunity. The Managerial Approach to Public Administration The managerial approach to public administration has its origins in the early nineteenth century civil service reforms and the scientific management movement which viewed public administration as a businesslike function devoid of any political influence (Mosher 1982; Rosenbloom 1986; Stillman 1991 ). This view of the managerial approach to public administration was first articulated by Woodrow Wilson, who in the 1880s insisted that, "administration lies outside the proper sphere of politics" and that managerial questions are indeed a "field of business" (Wilson, 1880: 494). In his essay, Wilson is credited with positing the existence of a major distinction between politics and administration. This was a common 32

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and necessary tactic of the Progressive reform movement to limit spoils and other abuses of government agencies. The advocacy for a businesslike approach to public administration ultimately came to represent the orthodox or classical view of how the public service should operate. In articulating the values of the management approach Wilson found that, "It is the object of administrative study to discover first, what government can properly and successfully do, and secondly, how it can do these proper things with the utmost possible efficiency and at the least possible cost of either money or energy." (Wilson 1887:481 ). In other words, according to the managerial approach, public administration is to be geared toward maximizing effectiveness, efficiency, and economy. The first academic textbook of the field by Leonard White (1926}, and Gulick and Urwick's (1937) "principles of administration", reflect the movement toward the scientific management of public organization. These pre-W. W.ll doctrines of public administration dominated the early thinking about the management of the public's business. The management model of public administration, in its early inception, reflected the need for scientific management, scientific principles, and a "machine model' of organization. Identifying the "one best way" to administer government agencies was the preoccupation of these early theorists. To maximize the attainment of the values of efficiency, effectiveness, and economy, the managerial approach to public administration promotes the organizational structure universally identified as bureaucratic. Specialization, division of labor, span of control, and hierarchy, are all 33

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management terms associated with the bureaucratic form of organization. The bureaucratic form of organization and the values it promoted came under strong criticism after W.W. II, as the demands on the administrative state began to expand in scope. The most historically strident criticisms of the managerial approach to public administration, are reflected in the phenomena of bureaucracy. Post W.W.II theorists criticized the preoccupation with bureaucracy. While bureaucracy is a positive instrument for the implementation of governmental policies and programs, popular sentiment about bureaucracy is largely negative (Cayer and Weschler 1988:43). Many critics of bureaucracy have identified several common negative tendencies in bureaucratic behavior (Merton 1940; Thompson 1961; Downs 1967; Schon 1971 ). Generally, it is concluded that bureaucracies have conserving tendencies. They attempt to hold on to what is comfortable and known, and resist efforts at change. In protecting their turfs, bureaucracies tend to develop routines and procedures that serve their interests and limit the ability of outsiders to influence their activities. They are effective at resisting control and perfected strategies for survival (Greenberg 1974; Kaufman. 1976). It is the often impersonal and often inhumane approach to the individual, that draws the bulk of criticism of this dominant managerial approach to public organization. This is true whether the individuals are employees, clients, or the "victims" of public administrative agencies. 34

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Post W. W.ll critiques of bureaucracy have produced competing theories of organizational life for public organization ( Bernard 1938; Follet 1940; March and Simon 1958; Katz and Kahn 1966). These more humanistic schools of administrative thought, focus on social leadership skills, informal organization, group processes, quality of life in the workplace, and responsiveness to constituents. They insist that reliance on the impersonality of bureaucracies develops pathologies in organizations and individuals. These alternative theoretical approaches or models of the management are slowly having an impact on public organizations. However, the influence of the values of the orthodox or classical model of public administration, still maintains a significant influence on the theory and practice of the management in public organizations (Stillman 1991 ). The Management of Public Schools Local communities were responsible for the first public schools in America, and the beginning of educational administration occurred there. Since the schools were small and their programs were narrow by modern standards, required administrative services were few and were often performed by the community. Necessary management functions constituted the major internal administrative role and were performed by the teacher in one-teacher schools or a head teacher in larger schools (Grieder et al. 1969: 98). As school districts continued to grow, administrative duties required the full time of some individual. Thus, the school principalship and the 35

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superintendency developed along with other key roles as a response to local needs. States gradually assumed legal responsibility for school and began the development of state systems of education. An extremely important step in the developing of state school systems was the creation of local school districts. The local school district is an arm of state government and is granted authority by the state to exercise designated responsibilities for education in the district. Power granted to school districts varies considerably from state to state. In general, creation of local school districts recognized and preserved the initiative of local communities in school matters. The governance and management of local school districts has focused much attention on the administrative functions of schools. As with the field of public administration, the subfield of educational administration has undergone many shifts, and there are multiple theories regarding managerial functions. Concern for theory in educational administration was late in developing (Grieder et al. 1969:1 02). The concern for the leadership roles in educational administration, exerted a major influence on the growth of interest in theory to guide the practitioners in the field. However, there has been no general agreement, or a common set of definitions, and the borrowing from the more general theories of administration in both the business and public sectors has been significant. Textbooks on educational administration reflect a similar search for scientific "principles", key elements and competencies. Gregg and Campbell (1957:269), after a careful study of 36

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I the early literature on educational administration, concluded that the administrative process was composed of seven components: decisionmaking, planning, organizing, communicating, influencing, coordinating, and evaluating. Similar elements of administration are reflected in the broader public administration literature on the managerial approaches ( i.e., Gulick and Urwick 1937). The organizational values of efficiency, effectiveness, and economy have also been central themes in the development of this sub-category of public administration. As districts grew, and the complexity of the issues evolved, the governance and management of school districts took on the bureaucratic form of organization reflected in other public organizations. Many education administration theorists have shared their concerns regarding the problems created by the bureaucratic nature of public school systems (llich 1971; Elmore et al. 1991; Spring 1991 ). Decentralization and other reforms, have been slow to emerge from the public concerns that school districts are impenetrable bureaucracies which are not responsive to the need of students, teachers or community. The Brown decisions and their progeny presented a complex and challenging political and legal environment for administrators of public schools. The civil rights movement also bolstered the emphasis on equity and equal education as goals to be met by school districts. The problem with translating desegregation law into operational management plans was that the courts never crystallized a common definition of a desegregated school, nor did they provide an understandable set of mechanics for 37

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remedying a school system that was found to be segregated (Gordon: 1989:189). Desegregation plans, whether voluntary or court-ordered, required attention to many areas of concern. According to one guide for educators: The initial issue in planning school desegregation is the nature of the goal itself. Deciding when a school system is desegregated by race, sex, and national origin may be partly a matter of terminology and partly a matter of defining education. We consider desegregation to have occurred when students throughout a school system attend a interracial/gender classes, and when the schools and classes afford students equal education without regard to race sex, and national origin background. Desegregation included racial sexual hetero geneity and parity in administrative staffs, teaching facilities, and service personnel. In addition, curricular, extra-curricular activities, and programs must be designed or redesigned so that they appeal to and include racially/sexually heterogeneous groups of students (Chesler et al.1981: 1 ). The above interpretation of school desegregation is an operational definition of the legal mandate to eliminate dual school systems "root and branch". The requirements were established in Green v. County School Board, 391 U.S. 430 (1968). These guidelines stated that an adequate desegregation plan must include more than good intentions and the assignment of pupils to avoid the racial identification of schools. A school district must also address the policies and practices with respect to facilities, staff, transportation, extracurricular activities, and facilities (including school construction and closure). The managerial context of public school desegregation evolved from merely insuring against physical segregation, to 38

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dealing with a complex set of political and legal requirements related to representativeness, equity, and accountability (England and Morgan 1986; Epstein 1986; GordCJn 1989, 1994 ). The management of desegregation plans has been likened to trying to hit a moving target (National Network of Desegregation Assistance Centers 1989:1 ). For the most part, administrators were not aided by the persistently equivocal research on the impacts of segregation, even though the research and literature in this area is massive (Crain 1968, 1976; Clark 1971; Tucker 1994). There have, however, been a few studies of the issue of desegregation which have provided clues to administrators regarding "best practices" for achieving the goals of desegregation (Rossell and Hawley 1983; England and Morgan 1986; Fife 1992; Stave 1995; Wells 1995). After reviewing numerous studies, Willis Hawley (1983: 334-336), drew several conclusions which are worth noting: 1. Integration should take place in the earliest grade possible. Kindergarten and the first grade are better than the upper elementary grades and certainly better than the high school. This is because achievement differences between minority and majority pupils are smaller than they may be later, and prejudices are least. The possibilities for positive interactions, therefore, are at their highest. 2. Tracking and ability grouping should be avoided. Where they seem educationally essential, monitor them to ensure that racial diversity is maintained to the maximum extent possible. ""Pullout" programs for remedial instruction should be monitored for the same reasons. 39

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3. In heterogeneous classrooms, employ cooperative learning and peer teaching. Ensure that the teaching staff is well trained in using these approaches. 4. Within classrooms, strive to achieve a critical mass of minority students-approximately twenty percent. Less than this and students tend to segregate themselves. However, there is some evidence that intergroup conflict increases as parity is attained. 5. Increase the opportunities for interracial contacts in situations requiring cooperation rather than competition. Expand extra-curricular activities and do not make participation in them contingent on academic performance or behavior. 6. Create a relatively stringent disciplinary policy and enforce it evenhandedly. Parents are particularly concerned about the potential for race conflict in desegregating schools and should be involved in setting disciplinary codes. 7. Reduce the anonymity fostered by large schools and classrooms by creating smaller learning environments, and within them attempt to inculcate shared norms of academic achievement and good decorum. There is evidence that smaller class size leads to improvements in achievement, and these may be particularly important for integrating schools. 8. Once a plan is implemented, stick with it for a reasonable period of time. Desegregation plans are typically disruptive to students, teachers, and parents. Modifications coming rapidly one on another create additional disruption. Do not expect good plans to bear fruit in only a year or two. The nation's experience with desegregation has demonstrated that these management goals have been difficult to achieve (Bell 1980; F Brown 1994; Douglas 1995; Orfield and Eaton 1996). These management tasks 40

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have been made more difficult with demographic shifts, changes in the political climate, and a general lack of consensus regarding what works best in urban school districts. Understanding the barriers and constraints of the managerial dimensions of public school desegregation is critical to gaining a more comprehensive and policy relevant assessment of these efforts. Throughout the history of desegregation, there have been persistent issues regarding disparities in achievement, minority faculty, and access to programs. Faced with similar problems in the post-desegregation environment, school board members, administrators, and teachers have formed professional groups like the Council of Great City Schools, National Alliance of Black School Educators, and the National School Boards Association, which has allowed some communication among districts regarding equal educational opportunity. The sharing of knowledge and "best practices" in these professional contexts, will hopefully continue to focus on the need for both quality and equity as management goals in urban education. The Political Approach to Public Administration The political approach to public administration has been elaborated by a number of observers of the reality of public organizations. In moving beyond the separation of politics-administration dichotomy of the early classical/orthodox theorists in the field. Wallace Sayre (1978:201) finds that, "Public administration is ultimately a problem in political theory. The fundamental problem in a democracy is responsibility to popular control. 41

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The responsibility and responsiveness of the administrative agencies and the bureaucracies to the elected officials (chief executives, legislators and the public), is of central importance in a government based increasingly on the exercise of the discretionary power by agencies of administration. n The political approach to public administration has grown out of the observations of scholars such as Paul Appleby (1949: in Shafitz in Hyde 1978: 1 07), who considered public administration to be a "political process". In distinguishing public from private management he writes that, "Statecraft -government-is different from all other professions, because it is broader than anything else in the field of action. Government must be concerned with intellectual and emotional outreachings too. Government is different because it must take into account all of the desires, needs, actions, thoughts, and sentiments of millions of people. Government is different because government is politics. n The politicization of public administration has been documented at great length. Appleby and others portray the politics of administration, analyze the political process in administration, and present a philosophy of the politics of administration in a democratic society. There are various examples of how the values of the political approach are incorporated into the policies and practices of government (Appleby 1949; Long 1949; Kaufman 1956; Woll 1963; Downs 1967; Kaufman 1969; Seidman 1970). Once public administration is recognized as a political endeavor, emphasis must then be placed on a different set of values than those promoted by the managerial approach. The political approach to public 42

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I administration stresses the values of representativeness, political responsiveness, and accountability through elected officials to the citizenry. These are viewed as crucial to the maintenance of constitutional democracy and it is considered necessary to incorporate them into all aspects of government, including public management. Politics and Public Schools The public schools have become one of the most pivotal and controversial institutions in society. "The goals of education are related to politics and political beliefs because schools play and important role in providing access to jobs, determining social equality and inequality, and distributing knowledge about the political system. What one believes about the proper role of government in regulating the economy, and providing social justice, is almost always reflected in one's beliefs about the purpose of schooling (Spring 1991 : 29). Parents make housing choices based on the quality of schooling. Politicians are never hesitant to voice their opinions on school issues Racial and religious riots take place in the schoolhouse. Some parents accuse schools of not being patriotic, while others find them guilty of flag waving. Some members of society argue that schools will end poverty, and others maintain that schools maintain poverty (Spring 1991 : 3). Controversy about education has invaded politics at every level of government. A major source of controversy is the question of what the purposes of public schooling should be The political, social, and economic 43

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purposes or goals of schooling are often in conflict. According to Spring (1991: 6): The most important political goals of public schooling are educating citizens, selecting future political leaders, creating a political consensus, maintaining political power, and socializing individuals for political systems. These political goals can be both a source of political freedom and a means of exerting political oppression ... The major social purposes of education are social control, improving social conditions, and reducing social tensions caused by economic in equalities. The most important arguments given for support of public schooling are that education increases national wealth, socializes the future workforce, and advances technological development. The political philosophies of liberal, neo-conservative, and critical theorists have had a significant impact on our thinking about schools (Apple 1988; Spring 1991 ). Liberal beliefs are dominant in the Democratic Party, while neo-conservatives are influential in the Republican Party. Critical theory, is a recent movement among American intellectuals, which has stirred public debate through its exploration of issues related to race and class (Omi and Winant 1986; Delgado 1995; Delgado and Stefanic 1993, 1995; Spann 1993; Carney 1994; Bell 1995; Crenshaw et al. 1995). The desegregation of the nation's public schools has been one of the most politicized public policy issues in recent history (Crain 1968; Orfield 1978). When one views the desegregation experience through the political lens, the political values of representativeness, responsiveness, and accountability to the citizenry stand out sharply. The volatility of the issues 44

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of race, at the heart of desegregation efforts, serves only to heighten the level of politicization. One need only recall the federal troops in Little Rock, the rioting crowds in Boston. The Southern Manifesto, or the bombing of school buses in Denver, to sense the tension in the political dynamics of desegregation. The political lens is critical to understanding the barriers and constraints on achieving success with desegregation efforts. The political aspects of desegregation have been a determining factor in the success or failure of desegregation efforts throughout the country (Crain 1968; Kirp 1982; Orfield and Eaton 1996). The politics of desegregation have historically existed at several levels which include: intergovernmental, local community dynamics, cultural, bureaucratic, and through the influence of the media. The struggle for desegregation is a history of local, state, and federal control of public schools. Throughout the history of desegregation, the political dynamics between federal, state, and local governments, have had a consequential and mostly negative impact on the desegregation movement (Farley 1975; Showell 1976; Giles and Evans 1980; Wilkinson 1979; Kirp 1982). At the national level, the politics of the courts, the Congress, and presidential administrations, have diminished a national commitment to desegregation. Like many state legislatures of the 1950s, Congress in the 1960s and 1970s, expended great effort in designing amendments to the 1964 Civil Rights Act to restrain the enforcement of desegregation. The Nixon, Reagan, and Bush administrations are well noted for their anti-busing campaigns and administrative tactics to undermine desegregation. In his 45

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I I I I i i I j I I I I I I I I I I I exploration of UHow Equality Has Been Redefined in the Conservative Restoration", Michael Apple (1989:17) finds that, uThe growth of the new right and conservative movements over the past two decades, have had a great deal of success in redefining what education is for, and in shifting the ideological texture of the society to the right. u Many observers of these political struggles, find that the conservative revolution has proved to be a more potent force than Progressivism in redefining the struggle for equal opportunity in education. The Legal Approach to Public Administration In the United States, the legal approach to public administration has been historically eclipsed by the other approaches, especially the managerial approach. Nevertheless, it has a tradition and has emerged as a way of defining public administration Dwight Waldo (1956:29), explains that "It is logical and historically fit to begin with the law a model, with public administration viewed as or through a legal system. Thus viewed, administration appears primarily as a framework of rights and obligations, and when one studies administration, the focus is on an official definition of proper relationships between persons or bodies within the system proper." The "law proper" and the court system are concrete images in a person's mind when he/she approaches administration. According to Rosenbloom (1986:22), the legal approach to public administration is derived primarily from three interrelated sources. The first is administrative law As early as 1905, Frank Goodnow, a leading 46

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contributor to the development of public administrative theory, published a book entitled The Principles of Administrative Law of the United States. He defined administrative law as "that part of the law which fixes the organization, determines the competence of authorities which execute the law, and indicates the individual remedies for the violation of his rights". (Goodnow 1905:17). Public agencies, including school districts, are often best defined in terms of law:. An administrative agency is a governmental authority, other than a court, and other than a legislative body, which affects the rights of private parties through either adjudication, rule-making, investigating, prosecuting, negotiating, settling or informally acting" (Davis 1975:6). A second source of the legal approach, has been the movement toward the judicialization of public administration. Judicialization refers to the tendency for administrative processes to increasingly resemble courtroom procedures. Judicialization falls within the purview of Goodnow's (1905) definition of administrative law, but tends to concentrate heavily upon the establishment of procedures designed to safeguard individual rights (Rosenbloom 1986: 22). In the administration the public schools, due process procedures for the termination of personnel, the procedures for the expulsion and suspension of students, or deciding who goes where on a court-ordered bus, reflect this type of judicialization. Constitutional law also provides a third source of the contemporary legal approach to public administration. Since the 1950s, the federal judiciary has virtually redefined the procedural, equal protection and 47

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substantive rights and liberties of the citizenry vis-a-vis public administrators. The right to equal protection was vastly strengthened and applied in a number of administrative matters ranging from personnel recruitment systems to the operation of public schools and prisons (Rosenbloom 1986:23). In summary, the legal approach to public administration embodies three central values. One is procedural due process, which is hard to define precisely because it has been long recognized that this value cannot be confined to any single set of requirements or standards. Rather the term stands for the value of fundamental fairness and is viewed as requiring procedures designed to protect individuals from malicious, arbitrary, capricious or unconstitutional harm at the hands of government. A second value concerns individual substantive rights as embodied in evolving interpretations of the Bill of Rights and the Fourteenth Amendment. Third, the judiciary values equity, a concept like due process, which is subject to varying interpretations. In terms of public administration in general, equity stands for the value of fairness in the result of conflicts between private parties and the government (Rosenbloom 1986:24). The organizational structure of the legal approach to public administration is one that maximizes the use of adversary procedure. The full-fledged judicial trial is the clearest model of this structure. Adversary procedure calls upon two opposing parities to marshal facts and arguments in support of their positions. These dueling parties are brought before and impartial referee (e.g. judge or jury) who weighs the evidence, and ultimately 48

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decides which side is more correct. To a significant extent, this model is at odds with the values embodied in the both managerial and political approaches. It militates against efficiency, economy, managerial effectiveness, but also representativeness, responsiveness, and political accountability. It is intended, rather to afford maximum protection of the rights of private parties against, illegal, unconstitutional, or invidious administrative action. (Rosenbloom, 1986:27). The Legal Environment of Public Schools Since the public schools are governmental agencies, their conduct is circumscribed by legal concepts of general administrative law, supplemented by those necessary legal doctrine that have uniquely evolved from the historical traditions surrounding an educational organization that is state established but locally administered. What the courts have said in enunciating precedents and rules of law they have established, provides a necessary basis of knowledge valuable to all those involved with the public schools. Alexander and Alexander (1985), observe that even with the great sweep of constitutional precedents which the Supreme Court of the United States from time to time delivers, the laws governing our schools can often be difficult to accurately access and summarize. They find that: Beyond constitutional law, which is sometimes tighter knit because the Supreme Court can give the final word, we have a great mass of law pertaining to contract, property, torts, general administrative law, etcetera, which all bear on the administration of the schools. Substantial variation may be found from state to 49

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state, not merely because of the different statutory bases, but also because of the varying perspectives and philosophies of education which the judges, themselves, may have in viewing particular disputes. Certainly, the social context from which the cases emanate may have strong influence on the outcome of particular disputes (Alexander and Alexander 1985: xxxii). The mass of desegregation law demonstrates the dominance of the legal approach in the history of desegregation. The struggle to desegregate the nation's public schools is one of the most analyzed legal issues in the literature. The legal scholarship which most effectively deals with this issue, is that of the critical legal and race theorists (Ungar 1983; Delgado and Stefanic 1993; Spann 1993; West 1993; Bell 1995; Delgado 1995; Hayman 1995). These theorists provide insightful perspectives on the history of desegregation, race, constitutional rights, and the socio-political context of these efforts in urban school districts. Emerging in the 1980s, these theorist have stressed the importance of 1.) historical perspectives and the instructive role of historical narrative; 2.) perspectives on race, class, and gender which permit analysis to search beyond reductionistic notions like innate inferiority as explanations for the difficulties faced in regard to issues related to education; 3.) a critical view of the role of the courts and litigation as a means of achieving the expansion of rights, and finally; 4.) an emphasis on the need to focus on the convergence between theory and practice. Robert Hayman Jr. (1995:62-63) writes that: 50

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Critical race theorists articulate concerns that may have been ignored or marginalized by the dominant discourse, problematize concepts that seem otherwise immune from scrutiny, and suggest solutions that frequently at odds with the prevailing demands of convention or fashion. Thus, critical race theorists focus their writings on the struggle for racial justice, the persistence of racial hierarchy, and other issues of special importance to marginalized communities. They challenge the efficiency of both liberal theory and communitarian ideals as vehicles for progress, destabilize the supposed neutral idea of meritocracy and call for a re examination of the very concept of race Critical theorists point to the history of shifting attitudes and legal doctrine of the courts as essential ingredients in the societal retreat from desegregation. It is not only necessary to understand the litigative histories of desegregation cases, but to also be place them in the context of the interactions with political and managerial influences on their success or failure. As a judicial mandate and political rallying point, public school desegregation has been one of the most "public" and controversial policies in recent history. Rosenbloom's (1986) public administrative framework provides a unique vantage point from which to address the research questions posed by this study: 1.) How has Keyes v. School District No.1 impacted the Denver schools and community? 2.) How have the legal, political, and managerial factors affected the overall impact of this case on equal educational opportunity? 3.) What are the implications of these findings on the future of equal educational opportunity in the Denver schools? 51

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The Historical Case Study Methodology in Public Administration Grasping the contingent nature of the past can break the tyranny of the present. Seeing how historical actors made and remade social life, we can gain a new vision of our own present and future. That is perhaps the most important lesson historians can help people to draw from the past (Benson et al: 1986: xxiii-xxiv). Historians have been persistent in making the argument regarding history's usefulness in understanding contemporary policy issues (Graham 1980; Benson, Brier and Rosenweig, 1986; Neustadt and May, 1986). Without the reality of history, concepts employed by those in the social sciences become mere abstractions, devoid of content. Leffler and Brent (1990: 52) observe that, Terms like democracy, political man, rational man, or capitalism have no meaning apart from history, and likewise cannot be seen as elements in independent or free moving disciplines. Thus history remains the great synthesizer of human knowledge. Incorporating the other social sciences and allowing then to check their abstractions against the knowledge of history. History, in effect, becomes the data against which the hypotheses of the social sciences can be verified" (Emphasis added). As a method of empirical analysis, the case study has been an approach to understanding history, as well as, more contemporary public policy issues. The case study is used in many situations including: 52

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1.) policy, political science, and public administration research; community psychology and sociology; 2.) organizational and management studies; 3.) city and regional planning and research, such as studies of plans, neighborhoods, or public agencies ( Yin 1994:1 ). The field of public administration has employed the case study as a research tool for topics ranging from decision making to ethics. One notable public administrative case study which distinctly employed three conceptual frameworks to analyze an issue of public policy is Graham Allison's (1971) Essence of Decision: Understanding the Cuban Missile Crisis. In this case study, Allison provides and insightful interpretation of this explosive period in America's international politics. The historical case study approach to public policy is the methodology of choice in this research. The Keyes case is a twenty-five year saga that is rich with possibilities for the student of public administration. There is an opportunity to introduce readers to the original plaintiffs in the case (Wilfred Keyes and others), and to provide a sense of the human price that was paid by ordinary citizens just to get such cases into the Supreme Court. There is an opportunity to filter the historical facts of this case through the lenses of the managerial, political, and legal lenses described above. The case study, particularly historical cases, have been a popular tool for exploring the dynamics of desegregation. The literature is ripe with case studies describing desegregation litigation, implementation, and the dynamics of resistance and change these policies have produced (Franklin 53

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1975; Kluger 1976, Pratt 1992; Linden 1995; Stave 1995). A classic desegregation case study is Richard Kluger's (1976) Simple Justice: The History of Brown v. Board of Education and Black America's Struggle for Equality. In this historical treatment of Brown, Kluger observes that, II This book has not been conceived as a study of law and its permutations. It has been designed to suggest how law and men interact, how social forces of the post collide with those of the present". (Kluger, 1976: x). In reviewing the literature on desegregation, the case study approach has been a dominant methodology for exploring these experiences throughout the country. In reviewing dissertations written in the past thirty years on the topic of public school desegregation, many of these researchers have chosen the case study method as an appropriate method for the empirical analysis of these policies and their implications (Jenkins 1976; Dolak 1980; England 1982; Fuller 1983; Taylor 1990; Fife 1991). In the search for studies about the Keyes case specifically, the researcher has identified two, mostly legalistic analyses. They are a lengthy article in the Howard Law Journal by James Fishman and Lawrence Strauss (1989) entitled, II Endless Journey: Integration and the Provision of Equal Educational Opportunity in Denver's Public Schools: A Study of Keyes v. School District No.1." A second more dated analysis of Keyes, is a chapter case study by Jessica and Jeffrey Pearson (1978), in Howard Kalodner editor, Umits of Justice: The Courts Role in School Desegregation. These studies have been useful in assisting this researcher in verifying timelines, key events and actors, and issues which shape the descriptive analytic 54

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framework for this study. A third study of Keyes, a dissertation by Taylor (1990), provides an analysis of conflict and leadership among the key actors in the case up to 1977. None of these treatments of Keyes has explored the case from its beginning in 1969 to the end of court ordered busing in 1995. Neither have these previous analyses examined the case from the public administrative framework of this study which views the managerial, political, and legal aspects of this desegregation history. In summary, the public administrative framework moves us beyond conventional assessments of the success or failure of desegregation (i.e. innate inferiority which assumed to impair achievement scores or the percentages of white flight). This framework provides a different vantage point from which to analyze the impact of Denver's desegregation experience on its schools and community. The history of Denver's struggle with desegregation, when viewed through the managerial, political, and legal lenses of public administration, reveals contradictions and conflicts not typically examined when evaluating desegregation policy. It also reveals, as Hochschild (1985) has suggested, why desegregation is so important and why it has been so difficult to achieve. The next three chapters, describe the history of Keyes as it is filtered through the larger context of the history of race and education and the conceptual lenses elaborated in this literature review. The three lenses of the "public administrativen approach to desegregation policies and practices. provide a different and more comprehensive view of this complex history. And although attention to the socio-economic factors and demographic shifts 55

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I I I I I I are important, research and policy framed in these approaches alone, have limited utility to policy makers and practitioners. The managerial, political, and legal lenses of public administration broaden our view for assessing the possible impact of Denver's desegregation experience on the schools and city. 56

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REFERENCES-CHAPTER II Alexander, Kem and M. David Alexander. 1985. American Public School Law. St. Paul: West Publishing Co: xxxii. Allison, Graham T. 1971. Essence of Decision: Explaining the Cuban Missile Crisis. Boston: Little, Brown and Co. Apple, Michael. 1988. Redefining Inequality: Authoritarian Populism and the Conservative Restoration". Teachers College Record. 90: 167-84 Apple, Michael. 1989. "How Equality Has Been Redefined in the Conservative Restoration". In Walter Secada, ed. Equity in Education. New York: Falmer Press: 30-55. Appleby, Paul. 1949. "Government is Different". In Jay Shafritz and Albert Hyde. 1978. Classics of Public Administration. Oak Park, Illinois: Moore Publishing Co. Bell, Derrick. ed. 1980. Shades of Brown: New Perspectives on School Desegregation. New York: Teachers College Press. Bell, Derrick. 1995. "Who's Afraid of Critical Race Theory?. University of Illinois Law Review. (Fall) 2: 513-547. Benson, Susan Porter, Stephen Brier, and Roy Rosenweig, eds. 1986. Presenting the Past: Essays on History and the Public. Philadelphia: Temple University Press: xxiii-xxiv. Bernard, Chester. 1938. The Functions of the Executive. Cambridge: Harvard University Press. Brown, Frank. 1994. "Brown and Educational Policy at Forty." Journal of Negro Education 63: 336-348. Carney, Martin. 1994. Faded Dreams: The Politics and Economics of Race in America. Cambridge: Cambridge University Press. Cayer, N. Joseph and Louis F. Weschler. 1988. Public Administration: Social Change and Adaptive Management. New York: St. Martin's Press: 43. Chesler, Mark A. et al. 1981. Making Desegregation Work: A Guide for Educators and Other Professionals. Beverly Hill. Sage: 1. 57

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. I I I i I I I I I K.enneth. 1971. "The Segregation Cases: Criticism of the Social Scientists Role". Villanova Law Review. 5: 224-240. Crain, Robert. 1968. The Politics of School Desegregation: Comparative Studies of Community Structure and Policymaking. Chicago: Aldine. Crain, Robert L. 1976. "Why Academic Research Fails to be Useful". In Florence Levinsohn and Benjamin D. Wright. (eds.) School Desegregation: Shadow and Substance. Chicago: University of Chicago Press. Crenshaw, Kimberle et. a/ ((eds.). 1995. Critical Race Theory: The Key Writings That Formed the Movement. New York: New Press. Davis, Kenneth. 1975. Administrative Law and Government. St. Paul, Minn: West: 6. Delgado, Richard and Jean Stephanie. 1993. "Critical Race Theory: An Annotated Bibliography-1993: A Year of Transition." University of Colorado Law Review. 66: 153-193. Delgado, Richard. 1995. Critical Race Theory: The Cutting Edge. Philadelphia: Temple University Press. Delgado, Richard and Jean Stephanie. 1995. "The Social Construction of Brown v. Board of Education: Law Reform and the Reconstructive Paradox." William and Mary Law Review. 36(2): 547-570. Dimock, Marshall. 1980. Law and Dynamic Administration. New York: Praeger. Dolak, Mirko Julius. 1980. "Toward the Development of a Policy Typology and Policy Implementation Model: The Case of School Desegregation in the L.A. Unified School District, 1977-1980." Ph.D. diss., University of Southern California. Douglas, Davison M. 1995. "The Promise of Brown Forty Years Later: Introduction". (Symposium: Brown v. Board of Education After Forty Years: Confronting the Promise) William and Mary Law Review. 36(2): 337-343. Downs, Anthony. 1967. Inside Bureaucracy. Boston: Little, Brown, and Co. Elmore, Richard F. et al. 1991. eds. Restructuring Schools: The Next Generation of Educational Reform. San Francisco: Jessey-Bass Publishers. 58

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I I England, Robert E. 1982. "Assessing the Status of Urban Public School Desegregation: A Case Study Approach". Ph.D. diss., University of Oklahoma. England, Robert E., and David R. Morgan. 1986. Desegregating Big City Schools: Strategies, Outcomes, and Impacts. New York: Associated Faculty Press. Farley, Reynolds. 1975. "Racial Integration in the Public Schools, 1967-72: Assessing the Effects of Governmental Politics" Sociological Forces 8(January): 3-26. Fife, Brian. 1991. Comparative Intervention Strategies: Desegregation of American Schools. a Ph.D. diss., State University of New York, Binghamton. Fife, Brian. 1992. Desegregation in American Schools: Comparative Intervention Strategies. New York: Praeger Publishers. Fishman, James J. and Lawrence Strauss. 1989. "Endless Journey: Integration and the Provision of Equal Educational Opportunity in Denver's Public Schools/ A Study of Keyes v. School District No. 1". Howard Law Journal 32: 627-728. Fox, Elliot M. and Luther Urwick. eds. 1940. Dynamic Administration: The Collected Papers of Mary Parker Follett. New York Hippocrene Books. Franklin, Vincent P. 1975. "The Persistence of School Segregation in the Urban North: An Historical Perspective". Journal of Ethnic Studies. 1 (4): 51-68. Fuller, James Nathaniel. 1983. Legal Aspects of Busing for Desegregation in De Facto Segregated School Districts." Ph.D. diss., University of North Carolina, Greensboro. Giles, Michael W. and ArthurS. Evans. 1980. "Mass Level Compliance With Public Policy: The Case of School Desegregation". Journal of Politics 37(August): 722-746. Goodnow, Frank. 1905. The Principles of Administrative Law in the United States New York: G.P Putman's Sons: 17. Gordon, William. 1989. "School Desegregation: A Look at the 70s and 80s." Journal of Law and Education: 189. Gordon, William. 1994. "The Implementation of Desegregation Plans Since Brown." Journal of Negro Education. 63(3): 310-22. 59

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I I I Greenberg, EdwardS. 1974. Serving the Few: Corporate Capitalism and the Bias of Government Policy. New York: Wiley. Graham, Patricia. 1980. "Historians as Policymakers". Educational Researcher 9(11): 480-495. Gregg, Russell T. and Ronald F Campbell. 1957. eds. Administrative Behavior in Education New York: Harper and Row: 269 Grieder, Calvin, Truman Pierce and K. Forbis Jordon. 1969. Public School Administration. New York: The Ronald Press Co.: 98, 102 Gulick, Luther and Lyndall Urwick. eds. 1937. Papers on the Science of Administration. New York: Institute of Public Administration Hawley, Willis 1983 "Achieving Quality Integrated Education-With or Without Federal Help" Phi Delta Kappan. 64 : 334-336. Hawley, Willis et al. 1983. Strategies for Effective Desegregation : lessons From Research. Lexington: D.C Heath. Hayman, Robert, Jr. 1995. "The Color of Tradition: Critical Race Theory and Post Modem Constitutional Traditionalism". Harvard Law Review 30 : :62-63. Hochschild, Jennifer L. 1985. Thirty Years After Brown: Washington, D C.: Joint Center for Political Studies: 1. lllich, Ivan 1971. "The Alternative to Schooling." Saturday Review, June 19: 4460. Jenkins, Jeffrey. 1976. "Historical Analysis of Two Selected School Districts That Have Undergone Desegregation." Ph .D. diss., University of Michigan. Kaufman, Herbert. 1956 "Emerging Conflicts in the Doctrines of Public Administration American Political Science Review. 50 (December): 1057-73. Kaufman Herbert. 1976. Are Government Organizations lmmortan Washington D.C.: Brookings Institute. Katz, Daniel and Robert L. Kahn. 1966 The Social Psychology of Organizations. New York: Wiley and Sons. 60

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Kirp, David L. 1982. Just Schools: The Idea of Racial Equity in America. Berkeley: Kluger, Richard. 1975. Simple Justice: The History of Brown v. Board of Education and the Black Struggle for Equality. New York: Alfred A. Knopf: x. Leffler, Phyllis K. and Joseph Brent. 1990. Public and Academic History: A Philosophy and Paradigm. Malabar. FL.: Robert K. Krieger Publishing Co.: 53. Linden, Glenn M. 1995. Desegregating Schools in Dallas: Four Decades in the Federal Courts. Dallas: Three Forks Press. Long, Norton. 1949. "Power and Administration". Public Administration Review. 9, (Autumn 1949): 257-264. March, James G. Herbert Simon. 1958. Organizations. New York: Wiley and Sons. Merton, Robert K. 1940. Bureaucratic Structure and Personality." Social Forces, 18: 560-568. Mock, David B., ed. 1981. History and Public Policy. Malabar, Fl: Krieger Publishing Co. Mosher, Frederick C. 1982. Democracy and the Public Service. New York: Oxford University Press. National Network of Regional Desegregation Assistance Centers. 1989. Resegregation of Public Schools: The Third Generation. Washington D.C.: U.S. Dept. of Education: 1. Neustadt, Richard and Ernest R. May. 1986. Thinking in Time: The Uses of History for Decision Makers. New York: Free Press. Omi, Michael and Howard Winant. 1986. Racial Formulation in the United States: The 1960s to the 1980s. New York: Rutledge and Kegan Paul. Orfield, Gary. 1978. "Research, Politics and the Anti-Busing Debate". Law and Contemporary Problems. 42 (4) Autumn. Orfield, Gary and Susan E. Eaton. 1996. Dismantling Desegregation: The Quiet Reversal of Brown v. Board of Education. New York: W. W. Norton and Co: vii. 61

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Pearson, Jessica and Jeffrey Pearson. 1978. "Keyes v. School District No. 1." In Howard Kalodner, ed. Umits of Justice: The Role of the Court in School Desegregation. Cambridge, Mass.: Ballinger Publishing Co. Pratt, Robert. 1992. The Color of Their Skin: Education and Race in Richmond, Virginia, 1954-89. Charlottesville: University Press of Virginia. Rosenbloom, David. !986. Public Administration: Understanding Management, Politics and Law in the Public Sector. New York: Random House: 4, .6, 19, 22, 23,24, 27,29. Rossell, Christine and Willis Hawley. 1983. The Consequences of School Desegregation. Philadelphia: Temple University Press. Sayre, Wallace. 1978. "Premises of Public Administration: Past and Emerging" In Jay Shafritz and AI Hyde, eds. Classics of Pubic Administration. Oak Park, Illinois: Moore Publishing Co.: 201. Schon, Donald. 1971. Beyond the Stable State. New York: Norton. Seidman, Harold. 1970. Politics, Position, and Power. The Dynamics of Federal Organization. New York: Oxford University Press. Shafritz, Jay and Albert Hyde. eds. 1978. Classics of Public Administration. Oak Park, Illinois: Moore Publishing Co. Showell, Betty. 1976. "The Courts, the Legislature, the Presidency and School Desegregation Policy" in Florence Levinsohn and Benjamin D. Wright. eds. School Desegregation: Shadow and Substance. Chicago: University of Chicago Press: 100. Spann, Girardeau. 1993. Race Against the Court: The Supreme Court and Minorities in Contemporary America. New York: New York University Press. Spring, Joel. 1991. American Education: An Introduction to Socia/ and Political Aspects. White Plains, N.Y: Longman Publishing Co.: 3, 6, 29. Stave, Sondra Astor. 1995. Achieving Racial Balance: Case Studies of Contemporary Schoo/ Desegregation: Contributions to the Study of Education. Westport, Conn.: Greenwood Publishers. Stillman, Richard. 1991. Preface to Public Administration: A Search for Themes and Direction. New York: St. Martin's Press: 12. 62

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Taylor, Mary Jean. 1990. "Leadership Responses to Desegregation in the Denver Public Schools, A Historical Study: 1959-197r. Ph.D. diss., University of Denver. Thompson, Victor. 1961. Modem Organization. New York Knopf. Tucker, William H .. 1994. The Science and Politics of Racial Research. Urbana and Chicago: University of Illinois Press. Unger, Roberto. 1983. The Critical Studies Legal Studies Movement. Cambridge: Harvard University Press. Waldo, Dwight. 1956. Perspectives on Administration. University of Alabama: University of Alabama Press:29. Wells, Amy Stuart. 1995. "Re-examining Social Science Research on School Desegregation: Long Versus ShortTerm Effects" Teachers College Record 4 (Summer): 692-706. West, Cornell. 1993. Race Matters. Boston: Beacon Press. White, Leonard. 1926. Introduction to the Study of Public Administration. New York: MacMillan Co. Wilkinson, J. Harvie Ill. 1979. From Brown to Bakke: The Supreme Court and School Integration: 1954-1978. New York: Oxford University Press. Wilson, Woodrow. 1887. "The Study of Administration," Political Science Quarterly 56 (December 1941): 481, 494 (originally copyrighted in 1887). Woll, Peter. 1963. American Bureaucracy. New York: W.W. Norton Co. Yin, Robert K. 1994. Case Study Research: Design and Methods (Second Ed). Thousand Oaks: Sage Publications: 1. Cases Green v. County School Board of New Kent County, 391 U.S. 430 (1968). 63

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CHAPTER Ill SEGREGATION IN DENVER AND THE EVOLUTION OF THE KEYES CASE Pre-Keves Denver and its Schools The frontier experience furnishes ample proof of the nationalization of racial hostility. The intrepid pioneers who crossed the western plains carried the virus of racism with them, as much a part of their psyche as their heralded courage and their fears. Once settled in frontier communities, these hearty souls erected the racial barriers their forefathers had created back East. As these pioneers cleared the land, built homes, schools, churches, and planted crops, they transplanted their bigotry into frontier life Even after the end of slavery, their belief in black inferiority would remain. The pioneers and their children would hold tenaciously to the creed of their ancestors (Katz 1996:307). Repeatedly, white settlers voted in the majority to keep black people from entering their land, voting in their elections, testifying in their courts, serving in their militias, or attending their churches and schools (/d at 307) Black settlers in the West, as they had in the East, organized opposition to slavery and discrimination. And in several instances, black pioneers leaped at the chance to build their own self-help settlements in the West, such as Blackdon, New Mexico.and Dearfield, Colorado (Katz 1996:298). 64

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Six months after the first important discoveries of gold were mined in the Colorado Rockies, Denver was founded by William Larimer as a stopping point for those struck with prospects of the mining boom of the last quarter of the nineteenth century. Established in 1858, the permanent town grew out of a pair of settlements at the mouth of Cherry Creek The mining town became known as the "queen city of the Rockies and grew rapidly as the financial, commercial, and manufacturing center of the West (Smiley 1901: 732). The first school in Denver was established in 1860, during the peak of the gold rush, by Owen J. Goldrick. Known as "professor", he opened his "Union School" in a log cabin located on the west side of Larimer and Market Streets. It was a private school with an enrollment of thirteen children, including two children of Indian descent, two of Mexican decent. The actual beginning of the duly organized public school system of Colorado, as well as that of Denver, was in an act passed early in the first session of the Colorado Territorial Legislature, which convened in Denver in September 1861. The act was a rather comprehensive one and similar in its provisions to the school law then in force in the state of Illinois. It provided for appointment by the Governor, during that session, of a "Territorial Superintendent of Common Schools" (Smiley, 1901 :735). Throughout this period, several private schools were established by a number of individuals. Denver was without public schools until the new territorial government brought into existence the office of the superintendent of schools. On November 7, 1861, Goldrick was appointed Superintendent 65

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of Schools for Arapahoe County. Getting the school districts established was no easy task, and it took Goldrick nearly a year to set up of the first two schools districts in Colorado. They were the East Denver District and the West Denver district which were both formally organized in 1862 as Districts numbers One and Two respectively (McKeever et al, 1989:4). The 20th Amendment to the Constitution of the State of Colorado, known as the Rush Amendment created the City and County of Denver (McKeever et al 1989: 12). This Amendment separated Denver from Arapahoe County, and the multiple school districts were consolidated into one. Also with this amendment, the school boards of these school districts were established. During the close of the nineteenth century, there was a proliferation of small school districts but some of them didn't even have a school building. This was, in most part, due to lack of tax funds. Many times students, living in one school district had to pay tuition to another district in order to attend school. This situation created difficulties in funding major building projects and programs. Many families were paying double tuition in the district in which they lived and the district in which their children attended school (/d., at 12). As a result of this amendment, the city and school district were synonymous. Thirty seven schools made of District No.1 when it began in 1902. The new district's school population continued to grow, increasing from 27,000 in 1905 to 30, 000 in 1917. The 1920s were years of expansion-26 new schools were constructed, five of them high schools. During the 20's, a system of "instruction committees" was initiated 66

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whereby teachers had a voice in what was taught and how it was taught. (ld., at 15). The racism and discrimination of the restrictive laws reinforced segregation in many aspects of the public and private lives of these pioneers. With schooling, as in other areas opportunities, for adequate education were limited. McKeever et. al. (1989), found that the practice of segregation in the Denver schools occurred early in this history. They note that: In the beginning, both black and white students attended school in the rented school space, but in 1868, people in the district requested separate schools and rental space was found to house the black students in a building at 16th and Market Street. The school moved February 2, 1869 to the African Baptist Church, and was later moved to the African Methodist Church at 19th and Stout Streets and continued there for the black students until the new Arapahoe School was complete in 1872 (McKeever et. al. 1989: 5). The segregation of the Denver Public Schools began early on and continued as a pattern enforced by custom and the law, until challenged by the case, which is the topic of this study. Segregation in the public schools was also reflected in the housing patterns of the early African American and Hispanic immigrants to the city. Blacks have lived in Denver from its earliest years, and all were not ex slaves. From a population of 1,000 in the 1880s, Denver's black population grew to six thousand in the 1920s, concentrated in the Five Points area east 67

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of the business district (Abbott et al. 1982:267). While legislation prohibited discrimination in public accommodations, blacks nevertheless, usually were excluded from white hotels, restaurants, and schools. Their occupational opportunities were limited to a few menial occupations: domestic servants, waiters, or Pullman porters (Fishman and Strauss 1989:632). The environment for racial separation and tensions was much like that of other parts of the nation during this period of migration and expansion of cities. Blacks, Hispanics, and Native Americans helped to shape the landscape of Denver and the West. Blacks have lived in Denver from its earliest years. Some, but not all were ex-slaves. By the 1920s, Denver's black population was concentrated in the Five Points area east of the business district. "Five Points was the center of black life in Denver for most of the its early history. Within their own isolated enclave, this neighborhood had black owned businesses including drug stores, restaurants, cab companies, and more. The Casino Cabaret and the Rosonian were popular night clubs where Black people went to dance and listen to good music" (Howard 1991: 16). The experience for the blacks who migrated to Denver has not been different from that of blacks who migrated to other major American cities. In a story of her family's history in the West, Sammie May Williams described Denver as a de facto segregated city. She, and most of the people she knew, worked as domestic servants in the homes of Whites. "They didn't even allow you to walk across York. Blacks had to sit in the balconies of theaters. Black people couldn't eat in downtown restaurants. 68

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And if you worked downtown you had to bring your lunch and eat it in a stairwell or wherever they (whites) allowed you to eat" (Howard 1991 :16). In the first two decades of the twentieth century, Denverites moved outwards from the core city creating expanding suburbs which served to deepen the city's social economic, and ethnic divisions. Newer immigrantspredominantly from Southern Europe and Scandinavia-lived in ethnic enclaves near the stockyards, foundries, railroad shops, packing plants and smelters where they worked. The large immigrant population in Denver led to a growth in nativism. In the 1920's the Klu Klux Klan had greater popular strength in the city and even acceptance by the political establishment. In this period and the following two decades, the key to politics was a conservative "fundamentalism" reflecting small town values (Abbott et al. 1982:267). Post-W.W.II Denver and the Expansion of Schools Depression in the early 30's affected the District Number One's schools. The city's assessed valuation fell, and the citizens voted down a bond issue for school buildings in 1938. Attention was focused on W.W.II, and from 1930-1946, a no-expansion pol icy seemed to be in effect, no schools were built for sixteen years. Between 1940 and 1970 the population and economy of Denver expanded significantly. The "queen city" attracted new business and a growing service economy which grew out of the outdoors tourist industry. 69

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The service economy and the outdoors tourist industry attracted new residents. However, the influx of high technology business benefited the metropolitan area rather than Denver proper. Between 1950 and 1970, the suburbs grew by two and one half times (Abbott et al. 1982: 280). A steady flow of new citizens increased the need for additional funding to alleviate overcrowding on the strained school system. In 1947, a new superintendent arrived in Denver who was to have a significant impact on shaping the school district. Dr. Kenneth Oberholtzer, a nationally recognized educator, brought a critical awareness of educational issues and optimism to the schools of post-war Denver. Dr. Oberholtzer found a school district with about 48,000 children, but lacking in community support or attention. As he surveyed his new work environment he found old, run down schools, inadequate curricula, and an electorate that hadn't voted in favor of a bond issue for years. Questioning whether the citizenry truly cared about its schools, Dr. Oberholtzer convinced voters to provided funding for expanding the school system to meet the growing needs of the community. He would be superintendent for the district from 1947-1967, and fashion a school district which would be nationally recognized (Taylor: 1990:46). Post-war governance in the Denver public schools was like that reflected across the nation. Educational issues were popularly viewed as apolitical, or a least non-partisan, and mostly of interest to older people, women or families with children. Few people showed much interest in how the schools were run. School board membership was the province of a 70

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small cadre of the town's elite, people who were recognized members of the community's power structure (/d., at 46). As the city grew, so did surrounding suburban development in the 1950s and 1960s. As Anglo populations migrated to outlying areas, Black and Hispanic populations migrated into those areas of the city in which housing was affordable and jobs were available. Blacks continued to converge around the Five Points business district, which extended east of the central business district. With the end of W. W.ll, blacks also moved slowly east from the Five Points area into the more middle class Park Hill area, a trend that formed the underpinnings of the Keyes case. These inner city areas were up to fifty per cent or more black. This also reflected the growing black middle-class in Denver composed of ex-military and the migration in of black professionals from the South seeking relief from the blatant display of racism and discrimination. To the dismay of these modern day pioneers, there would be no hiding place from the barriers of race in this Northern promised land. Discrimination and segregation in housing, schooling, and employment would eventually stir Denver's growing black population as it did in cities throughout the nation. Evidence of Racial Segregation In Denver Schools Although the battle for school integration in Denver was not fully launched until 1968, the climate momentum had been building through out the 1950s and 1960s. Newspaper accounts regarding the emergence of 71

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this issue indicate that a series of boundary changes resulting from the construction of a new high school in 1953, which provoked protest from the black community, as did a 1957 school boundary change (Denver Post, April 9, 1959). Protest mounted once again in 1959, after the Board of Education approved preliminary plans for the construction of a new elementary school in the section of northeast Denver known as Park Hill. Critics of the plan said that the construction site would lead to the creation of an all-black school. Despite the opposition, Barrett Elementary School was built and became overwhelmingly black in its student population. For years there had been controversy about the gerrymandering techniques utilized by the Board of Education and the administration for assigning students to schools. "One technique was the construction of schools in locations which predictably became racially segregated on the basis of a long apparent trend in black population movement. A second technique was the establishment of school attendance zones, which assigned black pupils to predominantly minority schools. A third technique was the use of mobile classroom units to accommodate the overcrowding at minority schools rather than assign these students to any underutilized schools in Anglo neighborhoods" (Pearson and Pearson 1978: 181 ). In 1962, Dr. Oberholtzer presented a new school construction plan which sparked controversy. The plan called for a new junior high school to be built in northeast Denver which would result in an all-black student population. As a result of these proposals for new construction and boundary changes, the segregation of the Denver Public School became a 72

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concern of several Denver organizations, including traditional civil rights agencies like the Urban League, CORE, the NAACP, and the Anti Discrimination Commission. The churches in the black community also organized to help solidify opposition to the plan. In addition to the African American community's reaction, churches and neighborhood organizations from the diverse Park Hill neighborhood became central actors in the desegregation controversy. One of the most active neighborhood associations was the Park Hill Action Committee (PHAC). This bi-racial organization was formed in 1960 to address issues impacting the changing nature of the schools, housing discrimination, and the flight of whites from the neighborhood in the wake of the black in migration to Park-Hill, which had been occurring since the late 1950's. (League of Women Voters 1976: 8) As a result of the growing controversy, and the fear of repeating violent incidents of other desegregating schools districts, the plans for the construction of the school were suspended and a special study committee was created in 1962. This group of citizens, board members, and professional staff, were known as the Special Study Committee on Equal Educational Opportunity in the Denver Public Schools. "The members of the committee brought with them the diverse attitudes of various segments of the total Denver community-geographic, economic, racial, ethnic-ranging from pride in the status quo and objection to change, through various shades of interest without particular opinion, to feelings that real inadequacies existed, with strong desires for change" (Special Committee Report 1964:1 ) 73

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There were two separate but related on which the committee focused. One was the education of the urban disadvantaged child ; the other, the problem of the effect of racial segregation on the educational process. The charge of the committee was "to study and report on the present status of educational opportunity in the Denver Schools, with attention to racial and ethnic factors in the areas of curriculum, instruction and guidance; pupils and personnel' buildings, equipment, libraries and supplies, administration and organization; school community relations, and to recommend improvements in any or all of such areasn (Special Committee Report 1964 : 9) After nearly two years of study, interviews, surveys, consultant input meetings, and deliberations, the Committee released its report to the community in February of 1964 The report contained approximately 155 recommendations for improving educational opportunity in minority schools The Committee found that generally the Board of Education and the administration, principals, and teachers throughout the system shared a concern for the "disadvantagedn child, but that this concern has not been generally translated into effective action at the pupil level (!d., at: D-4 ). The report also criticized the board's unwritten boundary policies as designed to perpetuate racial isolation, as well as, the concentration of minority faculty at minority schools. The findings regarding the recruitment, assignment, and transfer patterns of minority faculty were most glaring The committee found that: While precise statistics are not available, the Committee believes that almost all of Denver's Negro teachers were initially assigned to schools having a high proportion of Negro students. 74

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I I A few have been transferred to other schools. As a result of its interviews, the Committee is convinced that race has been relevant in the assignment of teachers. It appears that the administration has been extremely reluctant to place Negro and Spanish American teachers in predominantly white schools because of concern with a possible lack of acceptance on the part of the white neighborhood and a realistic assessment of the possible lack of support by some principals and faculties (ld., at D-13). In reporting 1963 statistics on the distribution of teachers of minority background, the Committee found that 225 out of 3708 teachers on contract were Negroes, and out of this number (225), 165 or nearly 75 percent of all the Negro teachers were assigned to schools in predominantly Negro schools. (Special Report 1964: Appendix 36). The remainder were sprinkled in sparse numbers throughout the rest of the city. The committee also concluded that segregated schools resulted in inequality of educational opportunity and recommended a policy of considering racial and ethnic factors in setting boundaries to minimize segregation. At the same time the report upheld the neighborhood school concept and rejected as impractical the transportation of pupils for the purpose of integrating school populations. Policy 5100 was adopted in May 1964, which upheld the principle of educational equality and cited the desirability of reducing concentrations of racial and ethnic minority groups in the schools. It also established the first "school choice" movement in the city with an open-enrollment program designed to reduce racial imbalance. "The plan permitted parents to file 75

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I transfer requests to fill approximates 1,809 places, some 2 percent of the public school enrollment. Students were required to provide their own transportation. Aside from this limited program of school choice nothing else was undertaken to implement a policy of heterogeneous schools" (Pearson and Pearson 1978: 182). Critics of this "plan" insisted that it did little to impact the increasingly visible inequalities in the schooling of black and Anglo students. Moreover, in the significant Green v. County School Board of New Kent County, 391 U.S. 420 (1968), the Court ruled that the "freedom of choice" concept was unconstitutional as long as a basically dual system resulted. The Judges found that school choice plans were limited in their ability to end segregation or promote equal educational opportunity. Part of the limitation Denver and other districts' experienced with school choice, was the fact that around the country blacks would typically choose to be with blacks, and whites with whites. With the Green case mere "deliberate speed" was no longer sufficient. The Court removed from blacks the onus of initiating school desegregation and placed it on local school boards. The burden on a school today, the Court said in Green, "is to come forward with a plan that promises realistically to work, and promises to realistically work now." (Green, 319 U.S. 430 (1968). 76

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The Politicization of the Board of Education As the issues regarding the segregation of the public schools made their way into the public discourse and politics of the city, sides were being formed on both sides of the issue. Old Guard vs. New Guard school board elections were drawing issues related to race and education into the political arena. In the fall of 1963, Frank Traylor, an old established member of the school board died. Three of the remaining "new guard" members saw this unfortunate passing as an opportunity to demonstrate their good faith to the minority community. For a number of reasons many feared that a black could never be elected to the board, and it was felt by these members that this was an opportune time to appoint a black to the board. In the search for a black person who could gain the acceptance of the entire community the name of Rachel Noel emerged in conversations and editorials. Mrs. Noel and her family migrated from the South in 1949 to this prosperous Northern setting seeking greater opportunities. She represented for many in her community and beyond, a standard of education, commitment, and elegance. As a leader in the black community, Mrs. Noel had been recognized for her contributions to education and other areas of community life. She had served as a member of the Special Study Committee, and was probably one of the most knowledgeable members of the black community regarding issues related to the segregation of the pubic schools. Old guard members of the board found numerous reasons for avoiding the appointment of Mrs. Noel to fill the empty position. The board 77

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. I I I I remained in a 3-3 deadlock for months. The lack of a seventh member meant that the tie couldn't be broken. The factions on the board, along with community members politicked on both sides of this appointment. With this delay, tensions grew deeper and the controversy surrounding segregation increased. Finally, on February 26, 1964, just days before the Special Study Committee Report was to be released, and 5 1/2 months after the position had opened, the papers announced that the board had decided to appoint Robert S. McCollum, vice-chancellor of the University of Denver, former businessman and city councilman as the candidate qualified to fill the vacant slot (Taylor 1990: 61 ). With a swell of community support, Noel decided to run for the board of education in 1965. The times were changing and a voice for equal educational opportunity for all of Denver's children had emerged. During the nearly six month delay in the board replacement decision, the nation had witnessed the assassination of John F. Kennedy, and the passing of the Civil Rights Act of 1964, which provided additional leverage for the struggle for equal educational opportunity. In the school board race of 1965, James Voorhees and Rachel Noel, both of whom had served on the Special Study Committee, were elected as board members with John Amesse, a doctor. Edgar Benton, who had previously been the lone ucivil rights liberal" on the board, was now joined by Mrs. Noel, the first black ever to be elected to the Denver Board of Education, and two other members sympathetic to minority pupil problems (Pearson and Pearson 1978: 183). 78

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1966-The Berge Study Committee The steady increase of blacks moving to northeast Denver meant an even greater concentration of minorities in the Park Hill Schools. School overcrowding, the use of mobile units, and unabated racial segregation led to increasing pressure from civil rights and black community leaders for action on these issues. Once again, the Denver Board of Education responded to the growing pressure to confront the challenge of segregation and equal educational opportunity by appointing another study committee. In February 1966, the Advisory Council on Equality of Educational Opportunity, was charged ... to examine the 'neighborhood school' policy in its application to building new schools and additions to relieve overcrowded schools in northeast Denver, and to suggest changes or new policies if needed necessary to eliminate 'de facto' segregation" (Advisory Council Report 1967:8). William Berge, an attorney was appointed as chairman of this committee. Bernie Valdez served as vice-chairman. Both of these men would later be elected to the Board of Education. A year later, in February of 1967, the Advisory Council released its final report. Although there wasn't a lot to distinguish it from the 1964 Special Committee Report, it did recommend that there be no construction of new schools in northeast Denver until a plan could be developed to reduce concentrations of minority pupils. The report also advocated that heterogeneity in schools be increased to improve the quality of education for all students. It suggested the establishment of special programs in schools that would attract a variety of students from diverse racial backgrounds, 79

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(precursor of magnet schools); the creation of an educational center, or a multipurpose building to which students would be drawn for special purposes (human relations contact); and the creation of superior programs in several all-black junior high schools. A member of the advisory council, Stephen Knight Jr. wrote a minority report which questioned the financial feasibility of transportation costs for busing and contested plans for an educational center (Advisory Council Report 1967:182). As a culmination of his protest, that spring (1967), Stephen Knight, along with like thinking William Berge, ran as candidates for the school board with the support of the conservative views and money of the Republican Party. The issue of busing in Denver began to show signs of becoming a partisan issue. Berge and Knight disagreed with the direction the board was moving. Although they replaced two fairly conservative members, the rhetoric surrounding the campaign was an indication that the citizens of Denver wanted an even more conservative board (Taylor 1990: 97). The community responded to their anti-desegregation campaign promise, and the more liberal opponents were defeated. The Civil Rights Movement and the Evolution of the Legal Response to Segregation in the Denver Schools In addition to the increasing politicization of the board, the battle over segregation and equal educational opportunity in Denver was also heightened as the Civil Rights movement swept the country. Events 80

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occurring 1965-67 pushed these issues to the forefront. In these years the interaction patterns of the school board changed, the silent majority began to speak out, and racial tensions increased at both local and national levels. During the summer of 1965, racial tensions were escalating in many urban centers. As racial issues intensified, so did the pressure to do something about them. In 1967, an ill-fated bond issue to relieve overcrowding became entrenched in the controversy over segregated schools. The Board had been discussing the need for a bond issue for five years to respond to the urgent facilities needs of the district. The issues related to minority schools had resulted in one delay after another; it never seemed to be the right time or place for building. Bill Berge made the motion to bring a bond issue to the voters with the intention of reinforcing the neighborhood school policy. But Rachel Noel attached an amendment to this motion, which effectively forbade "building, or additions to buildings, in the areas of high or growing minority concentrations." (Taylor 1990:100). Controversy regarding the Board's intentions, and vague plans caused the bond issue to be defeated soundly by a two-to-one margin. After the Watts riots of 1965, community meetings were held in Denver and racial issues moved beyond the classrooms into the community. There were new activist voices emerging from various directions in the community. The Black Muslims, the Black Panthers, and from the Hispanic community, Corky Gonzales and the Crusade for Justice were targeting school issues as key to their struggles. Where the push had always been 81

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for integration, these voices were urging segregation. They did not want to be absorbed into White America. They wanted to keep their heritage and separateness. As racial issues became "hot", it was no longer just minorities who began to stake out positions on racial issues. There was a fertile environment for all kinds of racially or ethnically aligned organizations. In 1968, the concerns and protests about the racial injustice in the schools reached an increased level. Several events were critical in raising the level of awareness about the impact of segregated and unequal schools For the first time the school administration released comparative achievement data to the public These scores disclosed not only a significant disparity between the achievement levels of predominantly Anglo and predominantly minority schools (Black and Hispanic), but they also reflected very low achievement levels at minority schools, which became lower as the minority children advanced through the grades. There was also more evidence that the predominantly minority schools had a disproportionate number of minority teachers, more probationary, and inexperienced teachers. These findings regarding minority teachers had been previously brought to light in the 1964 Special Committee Report. The sensitive climate of the country was brought to a head with the assassination of Dr. Martin Luther King. Student upheavals were breaking out in several schools. In order to quell the violence that was heightening in the schools and spilling over in to the community, members of several groups of different ethnic persuasions formed Citizens for One Community. This group presented a petition to the community calling for national unity 82

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and racial balance in the schools. The organization developed a large support base throughout the Denver community to garner support for the introduction of the Noel Resolution on April 25, 1968. This resolution instructed Superintendent Gilberts to develop a plan for integration by the upcoming fall. Thousands of middle class blacks and white from the Park Hill community attended the public meeting at which this resolution was introduced. This highly publicized event stirred the community, so much so, that the board voted to table the resolution for one month (Pearson and Pearson 1978: 184 ). During this time, the community was mobilizing in two directions. The administration building and homes of uncommitted school board members were picketed. Speak Out for Integration groups attempted to inform the public about the harmful effects of segregation. Community, religious, political, and social leaders were approached to support the resolution. Indeed, the Denver Chamber of Commerce, and the Denver City Council, among other organizations voted to support the resolution. Two nights before the May meeting, at which the Board would finally voted, additional pressure was applied to the situation when the association of black school teachers, Black Educators United, announced its intention to boycott the schools in support of the Resolution. On May 18, 1968, a bitterly divided Board of Education officially committed the school system to integration. With a vote of 5-2 the Board adopted the "Noel Resolution" (Resolution 1490), introduced by Rachel Noel, which called for a comprehensive plan for the integration of the Denver 83

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Public Schools. After this was enacted, the Board and the administration spent from January to April 1969 studying fourteen alternative plans for the integration of Denver's schools. Hearings were held, and expert testimony was brought to bear on both sides of the issue. After months of debate and deliberation, Resolutions 1520, 1524, and 1531 were passed with much controversy. These resolutions offered more than a mere philosophical commitment to integration by offering a concrete plan of action to lessen racial imbalance. The plan, a massive document with multiple parts, was presented to the Board in the fall of 1968, by the newly appointed Superintendent Gilberts. It was titled Planning Quality Education: A Proposal for Integrating the Denver Public Schools. and also known as the Gilberts' Plan. The plan was adopted in this school year and would spark intensified conflict and controversy. The plan was considered a first act of departure from the Board's prior undeviating policy of refusing to take any positive action that would bring about integration. The plan included a one-way busing of three thousand black students from inner city elementary, junior high, and high schools to predominantly Anglo schools in Southwest and Southeast Denver. (East, George Washington, Thomas Jefferson, Smiley, Cole, Hill Jr. High schools, and Barrett elementary). "The superintendent recommended against a program of massive cross-town (two-way) busing to achieve immediate racial balance, and insisted that such a program does not contain sufficient promise of long-range educational benefits" (Rocky Mountain News, October 11 1968). 84

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The impact of this resolution and the plans for integration were electric. A former superintendent of Denver schools, who was an administrator at the time of these changes, remembers the student riots at George Washington High School. [W]e had chairs thrown through the windows, we had dogs on campus, ambulances were called, some kids were hurt, fortunately not seriously. The faculty was frightened -terrified. They weren't prepared for this at all... We closed that school for six days. I spent all my time out there [working to] put that school back together. We put it on full split double session-ruined the athletic program, ruined activities-but we got it back together (Taylor 1990: 161). As controversy about the merits of the busing plan increased, the school board election in May of 1969 became the focal point of the busing issue The community was split as candidates on both sides of the busing issue emerged. The proponents and opponents of desegregation in Denver worked vigorously to get their points across to the public There was much at stake, and the election of a majority to the Board on either side of the issue, would be an important and determining factor for the future of the desegregation of the public schools. An incumbent, Edgar Benton, and a newcomer, Monte Pascoe, both backers of the Gilberts' Plan, were defeated soundly by anti-busing candidates Frank Southworth and James Perrill. Both Perrill and Southworth had promised the electorate that they would save the city from forced busing, and that their first official act would be to rescind the 85

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integrative pro-busing resolutions passed by the previous majority. Over 108,900 Denverites, more than half of those registered, participated in the election. Nearly every organization in Denver took a position on the issue. For the next decade, the issues of busing and integration would preoccupy Denver's political scene. Gordon Greiner, a young lawyer who was just a spectator at the time of the election recalled, "That the school board election in the spring of 1969 was probably one of the most bitter public events this community has ever gone through ... [l]t was kind of scary to see how polarized this community was" (Taylor: 1990: 138). On June 9, 1969, the Board of Education became a 4-3 anti-busing majority against compulsory integration. Resolutions 1520, 1524, and 1531, which evolved out of the Noel Resolution, were rescinded and superseded by Resolution 1533, which sought to achieve desegregation on a voluntary basis. The rescissions and adoption of the new resolution were brought with little study. The Board's justification for this action was a response to what they felt was a community mandate expressed in the school board election. This "mandate" was questioned by many who reminded the newly constructed board that only 50% of voters had a voice in this election. The disappointment and the changing mood of the community made it difficult for pro-integration forces to back the voluntary efforts proposed by Resolution 1533. On the night of the election of the two anti-busing members, it became clear to those who were pro-integration and equal opportunity, that a legal battle was on the horizon. It had become apparent to the pre-integration members of the community that the efforts to make 86

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changes through the political process had failed. Those pushing for a movement for equal educational opportunity felt that with these actions they would be left with nothing but token programs and a continuation of the status quo. Many people from the community who had coalesced during the election, were brought together to lay the groundwork for the litigation. Lawyers, Robert Connery, Craig Barnes, and Gordon Greiner were recruited by Fred N. Thomas, formerly the chairman of the vocal Park Hill Action Committee. Financial and community support was also garnered from the NAACP Legal Fund of New York. Holland and Hart, one of the largest law firms in town, provided support for the plaintiffs primary attorney Gordon Greiner. George Bardwell, a researcher from the University of Denver, helped to organize extensive information about the historical status of the district in regard to these issues. Ten days later on June 19, 1969, eight parents of Denver public school students sought to enjoin the implementation of Resolution 1533 and the rescission of Resolutions 1520. 1524, and 1531. The suit was filed in the name of Wilfred Keyes, a black podiatrist whose wife was a teacher in the district. It was well understood that this would be an unpopular case and that there would be a possibility of danger. Keyes and the other families were represented by a group of pro-integration Denver lawyers. The stage was being set for more than twenty-twenty five years of legal and political battles, and managerial experimentation with the provision of equal educational opportunity in the Denver schools. 87

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The Search for a Legal Remedy to Segregation in Denver Schools It would take approximately three years for the Denver desegregation case to move from the lower courts to the Supreme Court. Through a series of appeals and maneuvers on each side, the complaint and motion for preliminary injunction were filed simultaneously in the U.S. District Court on June 19, 1969. The complaint listed as plaintiffs eight individual citizens and residents of the city of Denver and their wards or children, who were students in the Denver Public Schools. Included were Blacks, Anglos, and Hispanics. Listed as defendants were the school district itself, the then superintendent Gilberts, and all the members of the School Board in their individual and official capacities with the exception of pro-integration board members Amesse, Voorhees, and Noel (Pearson and Pearson: 1978: 189). The plaintiffs action was brought as a class action pursuant to Federal Rules of Civil Procedure commencing Civil Action No. C-1499. The complaint stated two claims for relief. First that the rescission of the Resolutions 1520, 1524, and 1531, be temporarily and permanently enjoined, and second, a declaratory judgment that the rescission of the resolutions by the school board, constituted a violation of the Equal Protection Clause. The second claim for relief addressed itself to alleged segregation in the schools in the Park Hill neighborhood, which became known as the "core city" schools The initial hearing was expected to last two to three weeks. That would allow district administrators plenty of time to plan for the following school year. Though there had been repeated threats of a lawsuit through 88

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the years, the districts legal advisors were caught off guard. "While the plaintiffs had been studying the situation for years and had been actively considering whether or not a lawsuit was appropriate ... nobody in the school district was doing the same thing." (Taylor:1990:142). The hearings on the motion for the preliminary injunction were held before District Judge William E. Doyle. The conservative anti-busing board members were not happy that the case had been assigned to Doyle, who was considered by many to be one of the most liberal of the District Court judges in the nation. On July 31, 1969, by order and opinion, Judge Doyle granted the motion for preliminary injunction, declaring that he found illegal "de jure" segregation in the Denver schools. The judge grounded his decision in the applicable law set in the precedents of Brown (1954) and other desegregation cases. The judge found that: Admittedly, the facts of the case at bar are different from Brown, but the legal implications of the Brown case are fully applicable here. We have seen that during the ten year period preceding the passage of Resolutions 1520, 1524, and 1531, the Denver School Board has carried out a segregation policy. To maintain, encourage, and continue segregation in the public schools in the face of clear mandates of Brown v. Board of Education (Keyes 303 F. Supp. 279, at 286). Some of the findings which Judge Doyle felt demonstrated clear patterns of segregation reinforced by official action, and also showed knowing and purposeful conduct resulting in "de jure" action by the board included: 89

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1. All actions of the School Board here under consideration occurred during the last ten years. Thus, they took place long after the decision of the Supreme Court in Brown v. Board of Education of Topeka, 347 U.S. 483, 74 S Ct. 686, 98 LEd 873 (1954). 2. The School Board Study Committees of 1964 and 1968 warned the members of the board of trends and strongly recommended measures which would avoid or remedy these conditions. The recommendations in the 1964 report were, for the most part, ignored, and this led to the appointment of a second implementation Committee which again was positive and specific in its recommendations. 3. During the entire decade, there was regular debate and although resolutions were adopted, no effective action occurred, and many of the actions which were taken had the effect of intensifying rather than alleviating the segregation problem. 4. Schools with predominantly minority student populations were shown to be staffed by a greater proportion of teachers on a probationary status, teachers with less than ten years experience and minority group teachers than were schools with a predominantly Anglo population( Keyes, 303 F. Supp. 279 at 284). Despite these findings, on appeal by the defendants, the 1Oth Circuit Court of Appeals vacated the preliminary injunction and remanded the case back to the district court for further proceedings, holding that the injunctive order lacked "specificity". The following chronology constructed by Pearson and Pearson (1978: 192-93), provides a summary and chronology of the protracted journey of the 90

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initial litigation of the Keyes case. These researchers charted the path of this case through the U.S. court system, to the Supreme Court and back: August 7, 1969. The district court proceeded with hearings pursuant to the remand. August 14, 1969. The district court issued its supplemental findings, concluding and temporary injunction (303 F. Supp. 289). The defendants immediately applied to the Court of Appeals for a stay. August 27, 1969 The court of appeals stayed the preliminary injunction pending further review and order. Plaintiffs immediately moved the Supreme Court of the United States for an order vacating the stay of the Court of Appeals. August 29, 1969. Justice Brennan granted plaintiffs' motion for a stay (396 U.S. 1215) Justice Brennan's order vacating the stay of the Court of Appeals further directed the reinstatement of the preliminary injunction of the district court. February 2-20, 1970. Trial on the merits of Plaintiff's complaint before Judge Doyle. March 21, 1970. Pursuant to said trial, the district court entered its opinion and findings on the issues and made permanent the preliminary injunction. The court reserved ruling on remedies until consideration of proposed be submitted by both plaintiffs and defendants. May 10-20, 1970. The court held additional hearings on proposed remedial plans. May 21, 1970. The court issued an opinion regarding remedies (313 F. Supp.90). June 11, 1970. Pursuant to the order and opinion of March 21, 1979 and pursuant to the opinion regarding plans and remedies of May 21, the district court issued its final decree and judgment. Both the 91

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defendants and the Plaintiffs appealed the final decree and judgment to the court of Appeals. March 2, 1971. The Court of Appeals granted said motion for stay as to all judgment. March 26, 1971. The Court of Appeals granted said motion for stay as to all proceedings pertaining to the plain envisioned by the district courts final decree and judgment not yet implemented as of the date of the stay. Per curiam, the United State Supreme Court vacated the stay ordered by the Court of Appeals (402 U.S. 182). June 11, 1971. The court of appeals issued its opinion and judgment regarding the appeal and cross-appeal from the final decree and judgment of the district court. The Court of Appeals affirmed the decision of the district court in part and reversed and remanded in part to the district court.(445 F. 2nd 990). Plaintiffs appeal to the Supreme Court of the United States, and their petition for certiorari was granted. (404 U.S. 1036). October 12, 1972. Plaintiffs appeal was argued before the Supreme Court. June 21, 1973. The Supreme Court, in an opinion delivered by Justice Brennan, modified the judgment of the Court of Appeals so as to vacate instead of reverse the relevant portions of the final decree of the district court (413 U.S.189). On appeal, the U.S. Supreme Court reversed the 1Oth Circuit Court's opinion. Keyes was the first non-southern case desegregation case to be decided by the Supreme Court. The majority found that where "school authorities had carried out a systematic program of segregation affecting a substantial portion of the students, schools, teachers, and facilities within the school system, it was only common sense to conclude that there exist[ed] a 92

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I I I predicate for a finding of a dual school system." (Keyes v. School District No. 1,413 U.S. 189 (1973). The Court further said: Where as here, the case involves one school board, a finding of intentional segregation on its part in one portion of a school system is highly relevant to the issue of the board's intent with respect to other segregated schools in the system. It establishes, in other words, a prima facie case of unlawful segregative design on the part of school authorities, and shifts to those authorities the burden of proving that other segregated schools within the system are not also the result of intentional segregative action (/d., at 207 -208). The purposeful concentration of minority students in certain schools did have the reciprocal effect of keeping other schools Anglo. The High Court established the presumption that the Board's negative acts in a substantial portion of the school district, rendered the entire district a dual system. It directed the district court, on remand, to offer the Board the opportunity to prove that the Park Hill areas was a separate, identifiable, and unrelated section of the district. In the event that the Board should fail in its proffer, the district court was to determine whether the Board's conduct, in deliberately segregating Park Hill schools, made the entire school system a dual system (/d., at 201 ). If so determined, the Board had the affirmative duty to desegregate the entire system root and branch. This case became significant in the context of the national movement for desegregation as the first ruling on desegregation in the North and West where there were no explicit statutes requiring segregation. This case is also noted for 93

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recognizing Latinos' right to desegregation, as well as that of African American students (Orfield and Eaton, 1996: xxii). On remand, and with additional hearings, Judge Doyle concluded that the segregative acts of the Board in Park Hill did constitute in the entire district, a dual school system. On December 13, 1973, pursuant to the mandate of the Supreme Court, the parties were ordered to submit plans for desegregation of the entire school district. After finding unacceptable the desegregation plans submitted by both the plaintiffs and defendants, the court appointed its own expert, Dr. John N. Finger, and thereafter approved Denver's first district-wide desegregation plan, known as the Finger Plan. (Keyes, 368 F. Supp.207 (D.Colo.1973). Throughout this initial period of litigation, violent modes of expressing opposition to the impending court-ordered desegregation plan flared throughout the city. In February 1970, shortly after Judge Doyle's first busing order, 46 buses were destroyed or damaged by dynamite blasts. Race-related tensions flared in various schools during the course of the controversy. Rachel Noel recalls the many nights that concerned friends would follow her home from board meetings to ensure that no harm would come to her. The latter part of 1973 saw the bombing of the school administration building, bombings at other school facilities, and letter bombs mailed to school board members. In addition, several key participants in the plaintiffs case were harassed by bomb threats and menacing phone calls. Plaintiff Wilfred Keyes was the victim of a bomb attack on his home. On June 9, 1974, shortly after system-wide busing of approximately 3,000 black 94

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I students was ordered, four flares taped together to imitate a bomb were found under the hood of a bus at the school bus lot which had been the site of the 1970 dynamite blast (Pearson and Pearson 1978: 208). In summary, this chapter has described the early history of Denver, its schools, and the segregative actions of the school district, which were finally challenged in the late fifties and early 1960s. The issue of desegregation, particularly the specter of busing, became a political issue which sparked racial hostilities and split the Denver community on opposite sides of the issue. The issue of busing also served to politicize the Board of Education and the educational decision making processes of the district, (i.e. community advisory committees). Superintendents and their administrations scrambled to manage these issues in the mist of political debate, factionalized board's of education, and threats of legal action. Frustrated with the inability of the political process to support the need to desegregate Denver's schools, legal action became the strategy for the AfricanAmerican community, its liberal allies, and eventually, the Hispanic community. The pressures of the civil rights movement, and growing racial tensions, challenged the Denver community, as they did in other parts of the country. Threats of violence to plaintiffs, school board members, and others spoke to the intensity of the impact of desegregation was to have on the Denver schools and community. Plans by both the plaintiffs and the defendant school district were submitted to the court and rejected. The busing plan was shaped by the court's outside "expert", Dr. Finger. This resulted in additional resistance 95

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and delay, as the buses to integrate Denver's schools began to transport black students to majority Anglo schools. This was only the beginning of the litigation, politics, and managerial challenges that desegregation would present for the next two decades. 96

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REFERENCES-CHAPTER Ill Abbott, Carl, Stephen Leonard and David McComb. 1982. Colorado: A History of the Centennial State. (rev. ed.). Boulder, Co.: Associated University Press: 267, 280,288. Fishman, James J. and Lawrence Strauss. 1989. "Endless Journey: Integration and the Provision of Equal Educational Opportunity in Denver's Public Schools/ A Study of Keyes v. School District No. 1". Howard Law Journal 32: 627-728. Howard, Cedric J. 1998. "Denver Has it Share of Black History". Urban Spectrum (February 1998), vol. 10, No. 11: 16. Katz, William Loren, 1996. The Black West. A Documentary and Pictorial History of the African American Role in the Westward Expansion of the United States. New York Touchstone: 298, 307. League of Women Voters. 197 4 (revised 1976). A Composite View of Denver's School Desegregation. Denver, Co: League of Women Voters: 8. McKeever, Gene, Kenton Forrest and Raymond McAllister. 1989. History of the Public Schools of Denver. Denver: Tramway Press, Inc.: 4, 5, 12. Orfield, Gary and Susan E. Eaton. 1996. Dismantling Desegregation: The Quiet Reversal of Brown v. Board of Education. New York: W. W. Norton and Co.: xxii. Pearson, Jessica and Jeffrey Pearson. 1978. "Keyes v. School District No. 1." In Howard Kalodner, ed. Umits of Justice: The Role of the Court in School Desegregation. Cambridge, Mass.: Ballinger Publishing Co.: 181, 182, 183, 184, 189, 192-193, 208 .. Smiley, Jerome C. ed. 1901. History of Denver. Denver, Co.: Denver, Times-Sun Publishing: 732, 735. Taylor, Mary Jean. 1990. "Leadership Responses to Desegregation in the Denver Public Schools, A Historical Study: 1959-1977". Ph. D. diss., University of Denver.: 46, 61, 69, 97, 100, 138, 142, 161. 97

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Cases Brown v. Board of Education of Topeka (Brown 1), 347 U.S. 483 (1954). Brown v. Board of Education (Brown II), 349 U.S. 294 (1955). Green v. County School Board of New Kent County, 391 U.S. 430 (1968) Keyes v. School District No. 1, 303 F. Supp. 279, *284 (D. Colo. 1969). Keyes v. School District No.1, 413 U.S. 189 (1973) (Keyes II) Keyes v. School District No. 1, 303 F. Supp. 289 (D. Colo. 1969) (Keyes Ill) Keyes v. School District No. 1,396 U.S. 1215 (1969) (Brennen. J., in chambers) ("Keyes Ill"). Keyes v. School District No. 1, 313 F. Supp. 61 (D. Colo. 1970) ("Keyes IV'); Newspaper Articles Denver Post, April 9, 1959. Rocky Mountain News, October 11, 1968. Archival Documents Special Study Committee on Equality of Educational Opportunity in the Denver Public Schools. Report and Recommendations to the Board of Education, School District Number 1.( Denver, Colorado, March 4, 1964): 1, 9, D-4, D-13, Appendix 36. Advisory Council on Equality of Educational Opportunity in the Denver Public Schools. Final Report and Recommendations to the Board of Education, School District No. 1 (Denver, Colorado, February 1967): 8, 182. Superintendent's Report. (Gilberts) Planning Quality Education: A Proposal for Integrating the Denver Public Schools. (Denver, Colorado, October, 1968). Policy 5100, Equal Educational Opportunity Policy, adopted May 1964. Board Resolution, 1490 (Noel Resolution) Board Resolutions 1520, 1524, 1531 (Implementation resolutions for Resolution 1490). Board Resolution 1533 (Rescinded and superseded Resolutions 1520,1524, and 1531. 98

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I I I I I i I I I I I I i I I i I I I I I I I I I I I I CHAPTER IV ELUSIVE EQUALITY: THE STRUGGLE TO IMPLEMENT COURT ORDERED DESEGREGATION (1973-1983) The Decision Mr. Justice BRENNAN delivered the opinion of the Court. This school desegregation case concerns the Denver, Colorado, school system. That system has never been operated under a constitutional or statutory provision that mandated or permitted racial segregation in public education. Rather, the gravamen of this action, brought in June 1969 in the District Court for the District of Colorado by parents of Denver school children, is that respondent School Board alone, by use of various techniques such as the manipulation of school attendance zones, school site selection, and a neighborhood school policy, created or maintained racially or ethnically segregated schools throughout the school district. (Keyes v. School District No.1, 413 U.S. 189 (1973). The Supreme Court agreed to hear arguments in the Keyes case in the fall and winter of 1972. The U.S. Supreme Court decision in Keyes was the first ruling on desegregation in the North and West, where there were no explicit statutes requiring segregation. Under Keyes, school districts were responsible for policies that resulted in racial segregation in the schools, including the construction of schools in racially isolated neighborhoods and gerrymandering attendance zones. Once intentional segregation was found 99

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in part of a district, the whole district was presumed to be illegally segregated. The implications of Keyes were felt nation-wide. A decision in Keyes was expected to establish a far-reaching precedent, particularly for segregation in the North. And Southerners were delighted to see their self righteous Northern counterparts on the spot for a change (Wilkinson 1979). Although the ruling was not unanimous, (i.e. Rehnquist's dissenting opinion and White's absence from this vote), the Justices chose to address a limited issue, one that had direct and clear implications for desegregation in Denver, and across the nation. The high court did not take issue with the findings of the lower court, nor did it even mention the issue of busing. Rather, the Court addressed the question of whether the District Court and the Court of Appeals had applied the correct legal standard in their determinations. The majority opinion Supreme Court ruling on Keyes reversed the decision of the District Court. The District Court had concluded its finding of a purposeful and systematic program of racial segregation affecting thousands of students in Park Hill, did not, in itself, impose on the school Board an affirmative duty to eliminate segregation throughout the school district. Instead, the court fractionated the district, and held that its finding of intentional segregation in Park Hill was not in any sense material to the question of segregative intent in other areas of the city (Alexander and Alexander 1980: 426). The High Court insisted that the lower court ruling misread the principle of law, and that the intentional segregation in Park Hill 100

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. I I I could not be separated out and made distinct from segregation in other parts of the city. The Supreme Court also made several points of clarification in this case which would provide the legal framework for the continuing battles over desegregation and equal opportunity in Denver and across the nation. The first issue, relates to the distinction between de jure and de facto segregation. De facto segregation is not unconstitutional whether it occurs in the South or in the North. The fundamental distinction between de jure and de facto segregation is the purpose or intent to segregate. The Supreme Court summarized the constitutional standard in the Denver case: ... we have held that where plaintiffs prove that a current condition of segregated schooling exists within a school district where a dual system was compelled or authorized by statute at the time of our decision in Brown ... the State automatically assumes an affirmative duty to "effectuate a transition to a racially nondiscriminatory school system ... ( 413 U.S. 203 (1973). If school authorities practice purposeful segregation, then a de jure condition exists and the school district is then required to take affirmative measures to correct racial imbalance in the schools. School board actions in this legal framework may have the effect of creating unconstitutional de jure segregation (Alexander and Alexander 1985:425). With Keyes, the distinction between de jure and de facto segregation would become a legal and political point of contention in desegregation cases. A major impact of this case is that it would eventually shift the onus of the burden of proof to the plaintiffs. It would become increasing 101

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problematic and difficult to prove the intent to discriminate as school district officials in Denver and elsewhere, would become more astute in avoiding actions, which would provide plaintiffs with this proof. This "burden of proof criteria would provide a formidable barrier for future desegregation litigation and the dismantling of desegregation across the country. A second issue which made Denver unique, was that it became the first desegregation case to address the tri-ethnic composition of a school district. The Judges recognized that: Denver is a tri-ethnic, as distinguished from bi-racial, community. The overall racial and ethnic composition of the Denver public schools is 66 percent Anglo, 14 percent Negro, and 20 percent Hispano. We conclude ... that the District Court erred in separating Negroes and Hispanos for the purposes of defining a "segregated school. We have held that Hispanos constitute an identifiable class for the purposes of the Fourteenth Amendment. Hernandez v. Texas, 347 U.S. 475, 74 S. Ct.667, 98 ,LEd. 866 (1954) ... 1n fact, the District Court itself recognized that "one of the things which the Hispano has in common with the Negro is economic and cultural deprivation and discrimination.n 313 F. Supp., at 69. This is agreement that, though of different origins, Negro and Hispanos in Denver suffer identical discrimination in treatment when compared with the treatment afforded Anglo students. In that circumstance, we think petitioners are entitled to have schools with a combined predominance of Negro and Hispanos included in the category of nsegregated" schools. Keyes v. School District No. 1, 413 U.S. 189 (1973). Hispanic interests would further complicate school desegregation in Denver and in other parts of the nation. The interests of Hispanics would 102

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often differ from those of both blacks and whites. Many Hispanics did not want desegregation, which they perceived to be disruptive of Hispanic communities and bi-lingual educational programs. Hispanic leader Bernie Valdez, who serve on the School Board in the 1970s commented that: You see Hispanics as a group have never been very much pro-busing, pro-integration, forced integration. They believe in integration, but they believe in it taking place more naturally. And the reason for this is that Hispanics haven't had the degree of discrimination that Blacks have had. And there is a different psyche about Hispanics' feelings about themselves and what Blacks feel about themselves. Its difficult to explain that unless you're one, very difficult. As a consequence, they don't feel the same compulsion to be mixed with Anglos ... I think by and large, Hispanics think that they can do it even in their segregated communities. They feel their segregation is voluntary. And that has something to do with a cultural pattern and their family strains and all of those things go way back ... centuries. So that gives a different psychological evaluation of where you are ... Then comes busing, which catches them in the middle. They really not part of the whole court situation at all, they got caught in the middle. (Valdez interview, in Fishman and Strauss, 1989: FN: 25: 634). Hispanics would enter the case as plaintiff-intervenors, but their educational agenda focused on bilingual-bicultural issues. Hispanics did not want, any more than blacks did, to be excluded from the resources and opportunities of the school district. But the differing views on desegregation would add another layer of complexity to the planning and implementation of desegregation plans. 103

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The Supreme Court remanded the case back to Judge Doyle at the District Court with the following directions as to what should be done next. The District Court was ordered to: 1.) provide the district with an opportunity to prove that there were reasons to treat Park Hill as a separate, identifiable, and unrelated section; 2.) determine if the segregative policies used in Park Hill made the whole district a" dual" system; and 3.) give the board an opportunity to prove that their policies relative to the core city schools, had been free of intent to segregate. The District Court also ordered the development of a plan which would eliminate illegal segregation root and branch" (Keyes, 368 F. Supp. 209). There was a significant amount discontent regarding the Court's ruling from both sides of the issue. Some felt that the judges had gone to far, others felt that the Court had not gone far enough. The issue that had stirred such deep reservoirs of emotion, i.e. busing, was not even mentioned in the Court's ruling. It actually wasn't necessary to address the issue of busing. Earlier decisions of the Court, particularly Swann v. Charlotte Mecklenberg, 402 U.S. 1 (1973), had already legitimized busing as a judicial tool for desegregation (Schwartz 1986: 36). The remand trial was held by Judge Doyle in early December 1973, with the Board still insisting that Park Hill was different from the rest of the city. On December 13, 1973, the court ordered the parties to submit plans for desegregation of the entire school district. Hearings were conducted February through March 1974, regarding proposed desegregation plans. In these hearings the plaintiffs submitted two plans; the defendant school 104

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district submitted a plan; and court-appointed consultant John Finger was also asked to submit a plan. An additional plan complementary to the plaintiffs, was developed by Dr. John Cardenas and submitted by the Congress of Hispanic Educators (CHE). There was controversy and criticism of all of the plans presented to the court. In pointing out the inadequacy of the specific p!ans, Judge Doyle found that the plan presented by the plaintiffs met constitutional standards for desegregating a dual system, the excessive and long bus rides made it unreasonable. The plaintiff's plans were, according to the Judge, "unduly complex and unadaptable to Denver's segregation problem." (Denver Post, Sunday May 5, 197 4: 77}. In more serious objections to the plan presented by the school district, the Judge found that this plan was" unconstitutional and equitably defective." The plan was criticized for the closing of inner city schools, and the continued operation of a dual system. After finding unacceptable the desegregation plans submitted by both the plaintiffs and defendants, the court turned to its own expert, Dr. John Finger. In relating to the public the legal and factual necessity for the court to fashion a plan, the Judge related the following: In Swann v. Charlotte-Mecklenberg Board of Education, 402 U.S.1 (1971 ), the problem of an uncooperative Board of Education was present just as it is here. The Supreme Court pointed out that the school board has the obligation to desegregate a dual school system and to produce a sufficient desegregation plan. 105

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The court ordered the professional staff of the school board to present certain work-ups and in response to these orders there were some submissions but the court found it impossible to work with the board in the preparation of a plan much less have the board do it because of their adamant opposition to any kind of scheme which called for transportation. Indeed, at the March trial the individual board members made it clear that they would oppose any plan (including their own) which made provision for busing. Minority members did not hold this view, but this was of no aid in obtaining production of a plan. The present attitude is nothing new because throughout this litigation the board has had fairly much the same approach. During this time opposition to busing has been exploited as a political issue and the board has steadfastly refused to take any action which might compromise its position in this regard. (April 8, 197 4, Memorandum Opinion and Order, 380 F Supp. 684). The impatient judge related to the Board that, "The Supreme Court has already said several times that what happens in one school affects another. Unless you can prove that the area outside Park Hill was not segregated by the same plan and design that you segregated the Park Hill Schools, which you have the burden to do, then you have a dual system." (ld ,at 685). 106

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The Finger Plan: The Initial Remedy 1974-76 Implementation of the Finger Plan was mandated for the 1974-75 school year. The desegregation plan adopted by the district court would contain a variety of measures. The central features of this plan contained four different procedures for integrating the Denver Public Schools: a.) All the schools have been rezoned through a computerized system for pupil accounting. This involves a grid system in which the center of each block in the city has coordinates and the information regarding the pupils living in that block are linked to the coordinates. b.) Some schools have been integrated by "short" busing of minority students. c ) Some schools have been integrated by receiving minority students who attend junior and senior high school in their home district. d.) 12,000 students are involved in a classroom pairing plan (The Finger Plan in Superintendent's Report, May 197 4:1) The logistics alone were enough to provide a managerial nightmare. Schools at the elementary, junior and senior high levels were rezoned to provide approximately 10,000 students with a walk in integrated school experience Approximately 37 elementary schools were organized in pairs or cluster for purposes of part-time reassignment of students on a classroom basis. This required transportation of students from their home schools to a receiving school for half days plus the lunch period. They would then be returned to their neighborhood school. A child would be in a "receiving" 107

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class some days, and in a sending class on others. Other elementary schools with about 4,300 pupils were to be integrated with short busing runs (Fishman and Strauss 1989:644). The court set a 40 percent minimum percentage and a 70 percent maximum percentage of Anglo students in every elementary school. In the secondary schools the minimum was set at 50 to 60 percent angles (Keyes, 521 F. 2d, 475 (1Oth Cir.1975). Deviations were permitted from those percentages in particular cases. One notable exception to the percentage guidelines, were the eight elementary schools with majority Hispanic pupil populations. The departure from the court's guidelines was justified for five of these schools, on grounds related to the school's accessibility and the desire to continue and expand bilingual-bicultural programs at these predominately Hispanic schools. The minority enrollments at these schools was projected to be between 77 and 88 percent (Keyes, 380 F. Supp. 692 (D. Colo. 1974). The plan also called for busing approximately 1,100 minority students (mostly black) from northeast to southeast Denver. Finger insisted that, "These students will bear a heavy burden in bringing about integration in Denver." (Finger Plan, Superintendents Report's 1974:1 ). And indeed they did. Black students would continue to bear the bulk of the burden of busing for the sake of integration. Provisions in relation to transportation, parental involvement were included to ease the "burden" of this more long distance busing. 108

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In addition to permanently enjoining the defendant school district from "discriminating on the basis of color in the operation of the school district ", the court reminded the defendants that the "duty imposed by law and by this Order is the desegregation of schools and the maintenance of that condition. The defendants were encouraged to use their full "know how" and resources to attain the described results, and thus to achieve the constitutional end by any legal means at their disposal. The other key provisions of the decree included: 1. Voluntary Open Enrollment. The Board was instructed to hold in abeyance its voluntary open-enrollment program pending resolution of various details of the Finger Plan and transfer procedures. 2. Collateral Services. The board was instructed to maintain "to the extent feasible", on-going programs of "collateral" services" such as hot breakfast programs, free lunches, tutorial programs, health services, remedial and compensatory education programs. 3. Busing. The Board was instructed to file plans with the court and to make immediate purchases of equipment for implementation of the busing required in the Finger Plan. 4 In Service-Teacher Training. The board was instructed to implement its own proposals for orientation and training of parents, pupils, school personnel, and staff as proposed to the district court. 5. Monitoring Commission. This key aspect if the decree required both parties to submit to the court nominees for appointment to a commission, initially to serve until June 1, 1975, at the expense of 109

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the district, to act as a liaison between the court and the "community" as to such matters as: coordination of community efforts to implement the plan, community education, receipt and consideration of criticism and suggestions from the community regarding the plan; assisting the community in working out programs with the school administration; reporting to the court as to the nature and resolution of such problems; and generally reporting on a periodic basis to the court about the implementation of the plan. 6. Bilingual-Bicultural Education. The School district was ordered to implement the model plan presented by Congress of Hispanic Educators (CHE) or a plan "substantially and materially similar." Retaining a qualified consultant to develop the program and implement the plan on a pilot basis at three elementary and one junior high and high school. 7. New School Construction. The defendants were enjoined from locating new schools or additions thereto in a manner conforming to patterns of residential segregation and were required to submit all plans for new schools or additions to the court, with notice to counsel for the plaintiffs and provision for hearings to air objections within thirty days on reporting to the court. 8. Reporting. The court set forth formal and detailed reporting requirements on a monthly schedule beginning May 1, 197 4, through September of 197 4 as to plans and administrative details, regarding implementation of the Finger Plan. 110

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. I 9. Additional Reporting. The defendants were instructed to report within thirty days of the commencement of the fall semester in 197 4 and the second semester in 1975 on an extensive array of statistical phenomena including ethnic distribution of teachers, distribution of tenured and probationary teachers, student dropouts, the number and nature of special administration hardship transfers, and actions taken to implement the bilingual-bicultural program. 1 0. Desegregation of faculty and Staff. The school district was instructed in detail as to the permissible standards for assignment of faculty and staff among all schools in the district and required to implement immediately affirmative action programs for hiring minority teachers, staff, and administrators with the objective of attaining a ratio of Hispano and black personnel within the district which corresponded more with their populations in the district. 11 Foot Dragging. The board was instructed to take steps to prevent the frustration, hindrance or avoidance of this decree, particularly with regard to spurious transfer and falsification of residence to avoid assignment. 12. Harassment. Any attempt to hinder, harass, intimidate, or interfere with the School board, its members, agents, servants, or employees in execution of this order shall be reported to the Department of Justice through the U.S. Attorney of the District of Colorado (Keyes, 380 F. Supp. 705). 111

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The District was also ordered to pay the consultant fees of Dr. Finger and to pay an award of attorney's fees and costs to plaintiffs' attorneys which had accrued since the beginning of the case in June of 1969. In addressing the issue of the flexibility and discretionary limits of the decree, the judge noted that: If the defendants are uncertain concerning the meaning or intent of the plan they should apply to the Court for interpretation and clarification. It is not intended that the school authorities be placed in a single "strait jacket" in the administration of the plan, but it is essential that the Court be informed of any proposed departure from the sanctioned program. The Court is committed to the principle of the plan, but it is not inflexible concerning the details. (Keyes, 380 F. Supp. 673). The defendants were encouraged to use their full "know how" and resources to attain the described results. Yet despite what seemed to be an openness to Board and staff details for the implementation of the plan, the Board of Education requested a stay of the Court's Order. The stay was denied by the District Court and the Appeals Court. An appeal was then filed with the U.S. Circuit Court (1Oth Circuit). Immediately following the issuance of this decree, the Board of Education voted to appeal this decision and its plans for busing thousands of students to the United States Tenth Circuit Court of Appeals. Superintendent Louis Kishkunis in reporting to the public on the progress of these issues stated that, "The Board recognized that an appeal would be indefinite, both in terms of time and results. In the interim, the implementation of the Court Order requiring several months of 112

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advance preparations must go forward. The Board instructed my staff and me to do all in our power to see that preparations were made. We have done so.n (Superintendent's Report, September 1974:1 ). In addressing the teachers and staff, Kishkunis insisted that, [I] admit I don't like the court order ... but it is a fact of life and we are professionals and are bound to implement it in good order ... There will be some soft spots, some inadvertent errors or oversights ... but we cannot allow ourselves any alibis or excuses. Whatever the reason, what ever the cause we must make certain that no critic can say that we didn't prepare, that we didn't have the ability and most emphatically that we didn't care.n (Denver Post, August 30, 1974). Each of the provisions of the court-fashioned desegregation plan would require the Superintendent and his staff to prepare the district for these changes, and to attempt to create an organization that could be responsive to these new challenges. Response to the Board's Appeal1Oth Circuit The Board of Education appealed the decision of district Judge Doyle to implement the Finger Plan for desegregation. On appeal, the Tenth Circuit affirmed most of the desegregation plan, but rejected the part-time pairing plan as constitutionally inadequate and ordered implementation of a full time plan for the desegregation of the Denver schools. The judges found that: In the present case, the court's part-time pairing plan would leave most participating minority schools intensely segregated during 113

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periods of instruction in basic subjects. Since we believe this lapse would seriously deprive minority pupils of an education equal to that provided in the Distr:ct's other schools, we must remand for implementation of a full-time desegregation program within a reasonable time and in accord with changing conditions Keyes, 521 F. 2d. 479 (10th Cir. 1975). In addition to this adjustment, the Circuit court reversed an order to consolidate two of the high schools. It also faulted the Finger Plan for leaving five elementary schools as segregated Hispanic schools. The court found that the five schools were substantially disproportionate in their racial composition, each with a Hispanic majority of 77 to 88 percent. The circuit court ruled that bilingual-bicultural education was not a substitute for desegregation, and such instruction had to be subordinate to a plan of school desegregation. Referring to the decision in Swan they found that, "The continued segregation of students at these schools must therefore be justified either on the grounds that practical or other legitimate considerations render desegregation unwise, or on the basis of proof that the racial compositions of these schools is not the result of past discriminatory action on the part of the board." Keyes, 521 F.2d. 470, n. 15 (1Oth Cir. 1975). The Circuit Court remanded this issue to Judge Doyle. And in an order entered on March 26, 1976, the five predominantly Hispanic elementary schools were included in the overall desegregation plan. Instead of finding some level of "relief' to the district in its appeal of the implementation of the desegregation plan, the remedy was further 114

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expanded and required additional busing. According to Willis Hawley, later a court appointed expert: After full implementation of the desegregation plan in 1975 Denver achieved approximately eighty-five percent of possible district wide racial balance. In subsequent years, level of racial balance increased. Prior to the implementation of the plan, eleven of Denver's 119 schools had enrollments that were more than ninety -percent minority. Twenty-one percent of the district's minority-student population attended these schools. By 1976, Denver had eliminated all eleven schools with such a minority population (Hawley et. al. 1983: 36). This initial"remedy" to the segregation of Denver's schools, would be plagued by controversy and politics, and would set the stage for over twenty years of court supervised desegregation. All the administrative "know how" of the superintendent and his administrative staff, would not be enough to prepare the school district and community for what would lie ahead. In Denver, the period following the court decision to impose school desegregation and busing, was one of the most tumultuous for the city and its schools. Several events and actors, were pivotal in shaping the impact the case would have. Changes in the leadership of the board and superintendents, volatile board politics, intervention of state officials, and yet another escalation in racial tensions created a climate in which the goals of equal educational opportunity envision by those who brought Brown, Keyes, and other desegregation cases would be lost. The impact of the political, 115

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legal, and managerial dynamics on the processes of school desegregation are clearly demonstrated in this period. The Politics of Busing The "politicizationn of desegregation and provision of equal opportunity in the Denver schools via the "busingn issue began in the mid sixties with the findings of the Special Committee. The 1969 school board election was a watershed. From then on, elections became ideological battlegrounds centered on the issue of busing. Busing continued to be an issue reflected in board politics throughout the 1970s and into the 1980s, ebbing and flowing, sharpening in intensity and then softening-but always there. Still some Denver residents say that one of the remedy's major obstacles had been a recalcitrant school board under intense political pressure from the community at large not to implement a less than popular court ordered busing plan. Although not all Denver School Board members have opposed busing as a way to integrate schools, the conflict between the proand anti-busers was played out in the local media and impeded the remedy's implementation (Fishman and Strauss 1989: 661 ). "The busing issue had become something of a pariah to politicians. Politicians at all levels throughout the state tried to avoid entanglement in the busing issues of Denver. It was a school board problem. There were careers to be protected. One strategy was to lay low. On the other hand, there were votes to be gained by opposing busing.n (Taylor 1990:218-19). 116

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For example, in 1970, Craig S. Barnes, a trial attorney for the plaintiffs, was severely defeated in a race for a seat in the U.S. House of Representatives in a campaign that aroused much proand anti-busing sentiment. In the 197 4 Mayoral race, the successful candidate conducted an advertising campaign that linked his opponent with Craig Barnes and a pro-busing s tance. In the previous year, 1973, in a Colorado Democratic primary for the U.S. Senate, Floyd Haskell won the nomination after placing advertisements in the suburban newspapers linking his opponent with busing and amnesty (/d., at 219). Even before the court issued its final order and decree, community reaction to desegregation began to crystallize in both directions. During this period, People Let's Unite for Schools (PLUS) was organized as a coalition of approximate fifty civic organizations formed to aid the smooth implementation of the Court ordered desegregation. This group expressed no commitment either way for or against busing (League of Women Voters, April 1976:8). The commitment of these organizations was to increase community awareness of the desegregation plans and to help prevent the type of violence experienced in past efforts to desegregate the schools. The more vociferous and potent force, was the organized opposition to school desegregation was a group known as the Citizens Association for Neighborhood Schools (CANS). An outgrowth of a variety of neighborhood associations opposed to busing, CANS was incorporate in January 197 4. According to the first president of CANS, Nolan Winsett, Jr., CANS had developed a membership of over 1,500 individuals, and by November 197 4 117

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had raised approximately $12,000. Shortly after the opening of school in October of 197 4, the CANS group called for a boycott of the schools as a demonstration of their continued resistance to busing. They felt it was important to keep up the struggle if there was going to be any chance of convincing politicians locally, and nationally, that it was time to change the United States Constitution and stop all this "sociological experimentation." (/d., at 218). The anti-busing push in the state gained significant momentum as school board members worked with like minded state legislators at state and national levels to impact what many felt was the Court overstepping its jurisdiction. The issue of local control was at the heart of these political battles. The anti-busing fervor of the nation was reinforced by the political campaign of Richard Nixon, and the actions of his administration to weaken the enforcement powers of the Department of Education and the judicial force behind desegregating school districts around the country (Wilkinson 1979; Hochschild 1984). There were many in Congress who wanted an amendment to either curtail the powers of the Supreme Court or prohibit busing for integrative purposes. The potency of local, state, and national anti-busing forces, was felt in Colorado when the Anti-Busing Amendment was added to the Colorado Constitution. Through town meetings, letter writing campaigns, boycotts and rallies, the group was able to mobilize enough support to put an anti-busing amendment on the November 197 4 election ballot in Colorado. More than 94,000 signatures were collected, more than double the number required to 118

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place the amendment on the ballot. Amendment 8 was passed overwhelmingly by the voters of Colorado (Pearson and Pearson 1978: 205). The Constitution of the State of Colorado expressly prohibits the use of such busing in the following language of the "anti-busing amendment: No sectarian tenets or doctrine shall ever be taught in the public schools, nor shall any distinction or classification of pupils be made on account of race or color, nor shall any pupil be assigned or transported to any public educational institution for the pur pose of achieving racial balancen (Colo. Const. Art. IX, Section 8). This action has been viewed as a clear effort to limit integration and busing. The amendment had no effect on the desegregation order for Denver because of the court order issued pursuant to federal constitutional law which has precedent over state law. The judges indicated that the anti busing clause in the Colorado Constitution was a key reason for the Court refusal to give up supervision of desegregation in Denver for so many years. In yet another legislative tactic to contain the dreaded busing and desegregation Denver was experiencing, the issue was next linked to the issue of annexation. Strong debate in the Colorado legislature found Denver officials hinting that suburban legislators objections to Denver annexations were based more on opposition to school busing than any other issue. A petition was circulated by the CANS organization to put a referendum on the ballot to amend the state law. Its passage meant that all qualified voters in a county could vote on a proposed annexation, not just those who would be directly affected. Known as the Poundstone 119

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Amendment, it effectively ended the expansion of the city of Denver. These two amendments to the Colorado Constitution clearly demonstrate the intensity of state level politics on the busing issue. The legislation effectively contained the issues related to the desegregation of public schools within the boundaries of Denver. The city and its desegregation problems were effectively "sealed off' from their neighbors. White and middle class blacks fled to the suburbs, leaving the city behind, and taking their tax money with them (Taylor 1990:220). And with these "protectionsn, there was no longer a need to be concerned if desegregation and busing would spill out into the suburbs. White flight to the outlying areas of the city could now proceed without the fear of busing invading the suburbs. In April 197 4, members of the Colorado state legislature passed House Joint Resolution No. 1012, calling for an amendment to the Constitution of the United States prohibiting the assignment of students to schools on the basis of race, creed, or color, and granting Congress the power to enforce this prohibition by appropriate legislation. On the federal level, in 197 4, Colorado's members of Congress split on bills that would have limited busing for integration to the next closest school (Pearson and Pearson 1978:207). The citizens of Colorado were not alone in their political protest of desegregation. State legislatures throughout the nation passed laws to limit the power of the courts in local affairs, and anti-busing bil!s also emerged in the U.S. Congress (Wilkinson 1979). 120

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Assignment of the Case to Judge Matsch In 1976, U.S. District Judge Matsch took over the supervision of the Keyes case. Richard Matsch was appointed to the U.S. District Court by President Nixon. Known as a brilliant and tenacious judge, he would guide the Denver Schools through the next two decades of legal battles over desegregation. The son of German-Lutheran parents who came to Denver from Burlington Judge Matsch began his legal career with the Denver law firm, Holmes, Roberts, and Owen. He worked in the office of the U S. Attorney and Denver City Attorney, and was a bankruptcy judge before his nomination to the federal bench. The hopeful anti-busing members of the board felt that this appointment may be an opportunity to receive relief from the order to desegregate the schools. After all, the Nixon appointment of conservative judges throughout the country was designed to reverse the momentum of desegregation. Despite his conservative connection Matsch's, forcefulness in the case surprised many and was very disconcerting to the Board In response to a criticism that the 197 4 implementation, and later adjustments to the desegregation plan that required frequent changes in school assignments which were frustrating and confusing for parents, the board call for a moratorium on changes in student assignments for three 121

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years in the interests of continuity and stability. Judge Doyle had previously honored the Board's request to avoid altering pupil assignments for three years, from 1976 through 1979, except upon Board request. Despite this effort to provide some calm to the desegregation of the schools, student enrollment and Anglo percentages continued to decline in these years of moratorium. In 1977, facing declining student enrollments and excess plant capacity, the board of education appointed an advisory committee of citizens to study the utilization of school buildings, and to recommend criteria for closures and consolidations. The Board accepted the committee's report in April, 1978, and anticipated making recommended changes in the Fall of 1980. In a letter dated October 2, 1978, the Community Education Council (CEC), which had been established in the 197 4 decree to monitor the implementation of the court ordered desegregation plan. requested a hearing. The purpose of this hearing would be to obtain a status report, from the school board and administration, on the development of a comprehensive, city-wide plan for the schools to take effect at the end of the three year moratorium. A new plan, adopted in Resolution No. 2060, met opposition from the plaintiffs/intervenors, and further hearings were held. The board's proposals in Resolution 2060 were designed to increase the number of students who would attend their neighborhood schools and to 122

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decrease busing. The burdens of the plan were not equally shared. Some children would be bused, while others would attend neighborhood schools. The board never considered upon whom the burden would fall. (Again mostly black students). After the CEC and plaintiffs objected to the plan of Resolution 2060, the board never met in legislative session nor considered alternatives. The judge was impatient with the many delaying proposals which called for further study. He was also aware that the administrative staff's reaction to the inquiries by the CEC were treated with hostility. He insisted that, u What is now needed is recognition by the Board of Education, school administration, and staff that they have not yet established a unitary, non-racial school system in Denver, Colorado and that they have a legal obligation to demonstrate to this court that they are taking appropriate action to reach that ;esult." (Keyes, 474 F. Supp. 1272). The board left it to Judge Matsch to make the necessary changes in pupil assignments. Matsch later said that the Board's dereliction of duty enabled its members to avoid criticism from the community, and permitted them to continue their politically popular protest against judicial intervention in local governance 1979-1982: The Search For a Non-Busing Plan One of the most significant areas of the Board's procrastination was in the development of a permanent unitary school district plan which would take effect when and if the district was released from the control of the courts. From July 1979, until the Spring of 1982, the Board was split along 123

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philosophical and political lines, with the anti-busers continuing to hold a four-three majority. In 1979, yet another controversy arose which would stir the political winds, bring the administration under criticism, and take the district and plaintiffs back to court. The court created watchdog group charged with evaluating integration in the Denver schools which would tell the judge that a new kind of segregation had swept into the city's schools. Members of the Community Education Council claimed they had found that Anglos were segregated from blacks and Hispanos according to their reading ability in Denver Schools. Such segregation could explain, the Committee felt, why Anglos dominated advanced high school classes, even when they are in a minority district. The Council also reiterated their complaints that some schools weren't and never had been within the racial balance percentages set by the federal district court order of 197 4. At this time 46% of Denver's school children were Anglo. The CEC also claimed the school district refused to provide it with information necessary to review the district's integration effort and hiring policies (Bob Weiss, Judge Orders School Probe into Reported Segregation, Rocky Mtn. News, January 14, 1979:9). CEC member James Reynolds, also submitted a report that said the district's inservice training program-required by the desegregation order and designed to make teachers sensitive to the needs of minority students --was in "disarray'' and "of little value." Reynolds, head of the Colorado Civil Right's Commission, said 36 of the city's 120 schools have no in-service program (/d., at. 1 0). 124

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It was a report from two CEC members, Faye Hill and Metropolitan State College professor Elaine Cohen, that prompted Matsch to order the segregation investigation. Their report said studies in cities similar to Denver show minority students aren't expected to do as well as Anglos and that teachers often automatically assign then to slow reading classes. The results in other cities show that by the time the students reach high school, black and Hispanic children are over-represented in classes for slow learners and the retarded. The pattern, Hill and Cohen said, is borne out by a limited study conducted in Denver schools (/d., at 10 ). The school district countered these claims, by insisting that the CEC had based their assessment on incomplete information and casual observance rather than the facts, and that they were over-stepping their level of competence. Board members and the administration denied suggestions that minority students in elementary schools are assigned to slow reading groups on the basis of race. They justified ability grouping to deal with the special issues that the disadvantages blacks and Hispanics bring to schools. This was not intentional segregation, but that which was necessary to meet these students needs. Hearings were held, and Judge Matsch ordered the district to investigate the allegations. The judge also ordered the school district to submit a full report on its past efforts to comply with the court order, and to develop and submit plans by May 1, 1979, for hiring and a comprehensive plan for desegregation efforts for the upcoming school year. Referring to fears that a probe would have an inflammatory effect on the public, Matsch 125

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I I I i added, "It seems to me we cannot, because of that, be afraid to face the facts. If the worst possible hypothesis is true, what effect is it having on the kids?" (Branscombe, Denver School Board Ordered to Probe School Assignments, The Denver Post, Jan. 14, 1979: 40). The controversy regarding these allegations, added fuel to the arguments on both sides of the issue. For those who believed there is no special magic to integration, and for those who still had hope, the issues were becoming more complex and no less political. The anti-busing majority was again solidified with the election of Franklin Mullen, a businessman who invested over $100,000 in his anti-busing campaign. He joined Robert Crider, who had opposed mandatory busing throughout his twelve year tenure on the board, and Naomi Bradford, a staunch anti-buser who was re elected in 1981. Bradford would later become the president of the board. The liberal faction of the Board included Kay Schamp, Rev. Marion Hammond, and the outspoken Omar Blair, all of whom supported busing. Despite Judge Matsch's July 30, 1979 memorandum ordering the Board to develop a plan for a permanent unitary school district, the delay tactics and lack of consensus on the part of the board, prevented the development of an acceptable plan. During this period, several plans were put forward which met resistance from a number of directions. The Ad Hoc Plan In 1980, the Board established yet another committee by resolution to formulate a plan which might be acceptable to the court, a blueprint to 126

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shepard desegregation on its proper course. Board member Kay Schamp chaired what was called the Ad Hoc Committee. The committee included representatives from the black and Hispanic communities, the teachers union, League of Women Voters, and the Parent Teacher-Student Association. The Ad Hoc Committee studied the issues and held public hearings. The first report from this committee was greeted with a negative response from interested community groups, including the CEC oversight committee. After months of further deliberations, the Ad Hoc Committee released its final report on June 5, 1981. In its final report, the Committee set out a definition of a unitary systemguidelines, and a pupil assignment plan for the implementation of the middle school concept. Included in this plan were provisions for maintaining 26 "walk-in" schools, creation of five new "walk in" junior high schools, and the elimination of 27 satellite attendance areas (Ad Hoc Committee Report 1981:1 0). Before consensus and final legislative action could be taken on the Total Access Plan, board member William Schroeder proposed a very different approach based upon an open enrollment policy or choice. The key feature of this alternative plan was to essentially eliminate forced busing. Schroeder's proposals did not sit well with many members of the minority community who saw the plan as an attempt to resegregate the schools. Despite these objections, the board forwarded both plans to the judge for consideration, and a request for hearings on to determine that the district was a unitary system and to establish a timetable for relinquishing jurisdiction. On November 12, 1981, the court entered its order refusing the 127

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request to consider the two proposals and directed the defendant district to file one "definite plan for the removal of racial discrimination in public education and the establishment of a unitary system Keyes. 540 F. Supp. 401 (1981 ). Total Access Plan After having both of the plans rejected by Judge Matsch in November 1981, the Board voted four to two, to formulate another plan by December 10 of the same year. The Board's anti-busing majority directed the staff to come up with a plan that would eliminate mandatory busing. Called the "Total Access Plan" (TAP), the plan's basic elements were open enrollments and magnet schools, both of which the majority of the board felt could create and maintain a unitary school system (Branscombe, Schools Ordered to Choose One Integration Plan, Denver Post, November 13, 1981: 1 B). In addition to allowing students to attend schools close to their homes, the Total Access Plan proposed creating thirty-five magnet schools throughout the district, and would eliminate mandatory busing. The plan also introduced a variety of innovative programs to the district like Fundamental schools, Montessori, language and engineering academies. The Total Access Plan was presented to the Board on December 1 0, by then superintendent Dr. Joseph Brzeinski. The Board approved the plan four to three, with the three liberal board members opposing it. 128

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The Board then filed the Total Access Plan with the court, and it was considered in two-weeks of hearings which concluded on March 15, 1982. Despite its many educational enhancements, Judge Matsch indicated that the plan was "unacceptable for implementation in the fall of 1982 because it was incomplete, insufficient, and unrelated to the realities of the continuing effects of past segregative policies." Keyes, 540 F. Supp. 399 (1982). The judge accused the district of not accepting its responsibility, and that the neutrality of the choice options had been previously criticized by the Supreme Court in Green v. School Board of New Kent County, 391 U.S. 430 (1968). This case challenged "freedom of choice" plans that had been implemented in school districts throughout the South. Such plans placed the burden of integration on blacks who were reluctant to transfer in the face of hostility and intimidation. Such plans gave the students the option of transfer from a black to a white school and vice versa. These plans maintain and aggravate segregation because students of both races choose to be with their own. The judge read this plan as a lack of concern and protection of the interests of racial minorities. "The Total Access Plan was a sink or swim approach with responsibility for finding access to opportunity placed on the students and their families." Keyes, 540 F. Supp. 401 (1982). During these hearings, the court heard from a number of "experts" on various aspects of desegregation. Most of them agreed that under this plan there would not be a significant level of desegregation. The sharpest criticism of the Total Access Plan's "voluntary choice" model as a strategy for desegregation came from Dr. Charles Willie of Harvard University, who 129

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had served as a consultant to the district. Although applauding the emphasis on quality of education, he found that there needed to be further constraints to ensure racial diversity along with educational choices. He suggested racial ratios and guidelines for parental choice. Dr. Willie advised the court that such a plan would be workable only if the following conditions were present: 1 The assurance of integration in the magnet schools. 2. The assurance of integration in the regular schools. 3. Demonstrated capacity of the transportation element. 4. The assurance of an adequate affirmative action program for the faculty. 5. The assurance of adequate integration in the placement of faculty. 6. An adequate system to provide fairness in disciplinary suspensions and pupil placement in the classroom. 7. The assertion by the board of its ultimate responsibility for making pupil assignments. 8. The assurance of some stability by restricting the frequency with which there can be a change in the choice of schools. (Keyes, 540, F. Supp. 399, 401 (1982). Despite its merits as an educational plan, the issues related to desegregation of the Denver Schools did not surface clearly in the plan. During the March 1982 hearings, the exchange between plaintiffs lawyer Gordon Greiner and Dr. Brzeinski, the superintendent, went as follows: Greiner: "Would you admit that the Total Access Plan is not designed for desegregation?" Brzeinski: "It's an education plan." Greiner: "It doesn't even mention school integration, correct?" Brzeinski: "That's correct." 130

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(Branscombe, Plan Not Drawn to Desegregation Brzeinski, Agrees. Denver Post, March 3, 1982). Consensus Plan-1982 In this case, I am now accepting the modified consensus plan for the single school year of 1982-83. I do so with considerable reservation because I am not convinced that the incumbent school board has shown a commitment to the creation of a unitary school system which will have adequate capacity for the delivery of services without racial advantages Keyes, 540 F. Supp. 402 (1982). On May 12, 1982, nearly three years after he ordered the Board to come up with a suitable proposal for a unitary district in an effort to end the lawsuit, Judge Matsch accepted the plan with reservations. The judge said that he would remain active in the case to make sure future reforms were enacted. The plan would not end the lawsuit but would serve as an "interim measure." He saw it as an "expedient" measure which would accommodate the educational policy decision to move to middle schools, and attenuate the divisive effect of the factionalism found in the present board of education." Keyes. 540 F. Supp. 402 (1982). The judge saw the Consensus Plan as a political compromise patched together by a school board whose majority abhorred busing. The school district had demonstrated that it was unwilling to formulate a long-term plan for a unitary system that met the judge's approval. As his confidence in the Board continued to diminish, Matsch wrote in his June 3, 1985 opinion, "the proposal was premised on a hope 131

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that there would be a discernible movement toward natural integration of these attendance zones by changes in housing patterns." Keyes, 609 F. Supp. 1491 (D. Colo. 1985). The judge's hope regarding the natural integration of Denver housing proved unrealistic. The persistence of residential segregation and housing discrimination in Denver, continued to present the problem of racially isolated neighborhoods. The plaintiffs objected to the Consensus Plan because of the re-emergence of racially identifiable schools in Northeast Denver, (high percentage black schools, Barrett, Harrington, Mitchell). The school board attributed the continued racial imbalance in these schools to white flight and said that the existence of three racially identifiable schools did not constitute a dual system. After all, since the beginning of the court order, racially identifiable schools continued to emerge in the Hispanic community as a result of housing patterns and the requirements of bilingual education programs. The uncertainty and confusion that continued regarding the appropriate direction for the desegregation of the Denver Public Schools compelled the judge to set benchmarks and timetable in the supervision of the district. He applauded and then disbanded the Community Education Council (CEC}. Judge Matsch felt that the level of complexity, which was evolving in this case, would require a different level of sophistication. He then established a panel of "experts", with the input of counsel, to be appointed under Rule 706 of the Federal Rules of Evidence, to provide 132

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additional input and to assist the district with how to make desegregation work in the Denver schools. This chapter has explored how elusive the goals of integration and equal educational opportunity became for the school district and community of Denver. There was no true consensus in the development of multiple plans. And the continued recalcitrance of the Board, did not facilitate the implementation of the court order. 133

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REFERENCES-CHAPTER IV Alexander, Kem and M. David Alexander. 1985. American Public School Law. St. Paul: West Publishing Co.: 425,426. Fishman, James J. and Lawrence Strauss. 1989. "Endless Journey: Integration and the Provision of Equal Educational Opportunity in Denver's Public Schools: A Study of Keyes v. School District No. 1". Howard Law Journal 32: 661,634, FN.25. Hawley, Willis, et. al. 1983. Strategies for Effective Desegregation: Lessons From Research. Lexington: D.C. Heath: 36. Hochschild, Jennifer. 1984. The New American Dilemma: Liberal Democracy and School Desegregation. New Haven: Yale University Press. League of Women Voters. 1976. Composite View of Denver's Desegregation. Denver, Colorado: League of Women Voters: 8. Pearson, Jessica and Jeffrey Pearson. 1978 "Keyes v. School District No.1." In Howard Kaloder, ed. Limits of Justice: The Role of the Court in School Desegregation. Cambridge. MA: Ballinger Publishing: 205, 207. Schwartz, Bernard. 1986. Swann's Way: The School Busing Case and the Supreme Court. New York: Oxford University Press: 36. Taylor, Mary Jean. 1990. "Leadership Responses to Desegregation in the Denver Public Schools, A Historical Study: 1959-1977". Ph.D. diss., University of Denver: 218-219. Wilkinson, J. Harvie Ill. 1979. From Brown to Bakke: The Supreme Court and Schoo/ Integration: 1954-1978. New York: Oxford University Press: 34. Cases Keyes v. School District No. 1, 413 U.S 189, 203 (1973). Keyes v. School District No.1, 368 F. Supp. 209 (D. Colo 1973) Keyes v. School District No. 1. 380 F. Supp. 673,684, 685,692, 705 (D. Colo., 1974) (Memorandum Opinion and Order mandating the Finger Plan). Keyes v. School District No. 1, 521 F. 2d. 465, 470(FN.15),475,479 (10th Cir.1975). 134

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Keyes v. School District No. 1, 474 F. Supp 1272 (1979). Keyes v. School District No. 1., 540 F. Supp, 339, 401 (1982). Keyes v. School District No. 1, 609 F. Supp.1491 (D. Colo. 1985). Hernandez v. Texas, 347 U.S. 475 (1954). Green v. School Board of New Kent County, 391 U.S. 439 (1968). Swann v. Charlotte-Mecklenberg Board of Education, 402 U.S. 1 (1973). Other Legal Colo. Const.. Article IX, Section 8. (Anti-Busing Amendment). Colo. Canst., Article XIV, Section 9. (Limits Denver's annexation capacity). Newspaper Articles Denver Post, Sunday May 5, 1974: 77. Denver Post. August 30, 1974 Denver Post, January 14, 1979:40. Rocky Mountain News, January 14, 1979: 8-10. Denver Post, November 13, 1981:1b. Denver Post, March 3, 1981. Archival Documents Report from the Superintendent of Schools. John Finger Plan: Special Report Denver, Colorado: Denver Public Schools, April1974). Ad Hoc Committe of the Board of Education Denver Public Schools. Unitary School System Plan: Final Report. Denver. Co.: Denver Public Schools, June 5, 1981. 135

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CHAPTERV THE DISMANTLING OF DESEGREGATION IN DENVER (1984-1995) To square American practice with the principle of equality, it was essential to end the deliberate segregation of schools. For that, we can thank Brown. But actually improving public education, let alone society, tums out to be much harder than the idealists of desegregation and their eager allies on the federal courts ever dreamed (Rocky Mountain News, editorial, May 18, 1994) A Unitary School District? By the 1980s, fifteen years of immersion in litigation, and experimentation with various strategies to both avoid and implement the changing desegregation decree, had produced few indicators of success There seemed to be no end in sight, and elusive and intractable questions continued to bewilder the court and the parties to the law suit. 1 ) How did the policy of containing blacks to northeast Denver affect Denver Public Schools as a whole?; 2.) What was required to remove those effects?; 3.) What must be done to protect against future segregation?; and 4.) How and when would the court conclude that the Denver Public Schools was a unitary system? (Fishman and Strauss: 1989:676). In 1982, Judge Matsch defined with the district and plaintiffs the standard of a unitary school system in the Denver case. Applying the Green 136

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criteria as the basis of the Court's definition of unitary status as one in which: All of the students have access to the opportunity for education, with the publicly provided educational resources distributed equitably, and with the expectation that all students can acquire a community defined level of knowledge and skills consistent with their individual efforts and abilities. It provides, a chance to develop fully each individual's potentials without being restricted by an identification with any racial or ethnic groups (Keyes, 540 F. Supp. 399 (D. Colo. 1982). In Green v. County School Board, 391 U.S. 420 (1968), the Supreme Court offered several criteria to measure whether a district had become a racially non-discriminatory school system: the composition of the student body, faculty, staff, the school transportation system, the physical condition of the school system, and extra-curricular activities. In concluding whether a school system is unitary, district courts must keep in mind the uniqueness of each district, the efforts of public school officials, and whether the end of the lawsuit will lead to future resegregation and return to a dual system. Despite these guidelines, the Supreme Court, in the 1980's, had yet to provide specific guidance as to when a racially unbalanced school system would be considered unitary, when a district court should return control to school authorities, or the manner in which a school desegregation case could be closed. The tradition of equity jurisprudence has been one of generality and an absence of specific guidelines. Critical legal theorists have observed that desegregation, and equity issues in 137

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general, have been treated by the Court in such a way as to provide plenty of room for delay and exception (Bell 1980; Liebman 1990; K.Brown 1992; Spann 1993; Delgado and Stephanie 1995). In December, 1983, the school board began to reshape its strategy in respect to desegregation in the district. Instead of delaying, and then grudgingly complying with the court's orders, the Board voted unanimously to seek a court declaration that the school system was unitary and desegregated, and that it be released from court control. In the 1980s, the changing legal context of desegregation remedies, and the lack of specificity in the Supreme Court's rulings regarding when and how a school district could be declared unitary, lifted the board's expectations. The political and legal environments supported the board's confidence to request release from the court and control of the district. Ten years of court-ordered desegregation seemed to be enough for the litigation weary board. The request for a return of the Denver Public Schools to local control was also a reflection of the conservative restoration and the Reagan Administration's policies toward forced busing and integration. Moreover, the desegregation efforts which were underway were not eliminating achievement gaps, Anglo and middle class black families continued to exit the city, and the quality of education was being questioned in all segments of the community. Hopes of release from court jurisdiction would also be withered by the unresolved issues related to bilingual education which the law did not separate from the broader desegregation issues. Despite these impending 138

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complications, the Board filed a formal motion on January 19, 1984 for entry of three orders: 1 a declaration that the Denver schools were a unitary system with respect to faculty, staff, transportation, extracurricular activities, facilities and composition of the student body; 2 a modification and dissolution of the injunction relating to the assignment of students to schools ; and 3 a declaration that the remedy previously ordered in the case to correct the constitutional violation had been implemented and that there was no need for continuing court jurisdiction (Keyes, 576 F. Supp. 1521 (D. Colo ,1983). In its request for an evidentiary hearing on the motion, the District stated it would demonstrate its compliance with the s i x criteria (Green Factors) and the court's definition of a unitary school system. On February 8, 1984, the Board received another boost when the Department of Justice moved to intervene as amicus curiae. This was the first time that the Justice Department had intervened in a private, i.e. citizen filed desegregation case The Department said it would intervene in cases in which court-ordered busing was in effect, but only upon the school board's request. However, in this case, the Denver Board never formally requested the Department to intervene, nor voted to do so. The Board president, Naomi Bradford, on her own initiative, requested the Justice Department intervention. The Justice Department decided to intervene after the Board 139

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unanimously resolved to ask Matsch to declare the system unitary. The court allowed this intervention (Fishman and Strauss 1989:680-81 ). The position of the School Board was that: Once a school district has complied with a constitutional acceptable court-ordered remedy that is designed to desegregate the system in the full sense, and has maintained substantial compliance with that remedy for a sustained period of time, the school district is entitled to be declared unitary unless there have been intervening acts of discrimination (Denver Post, Feb. 10, 1984). The prime thesis of this argument, was that the 197 4 Final Judgment and Decree, as modified in 1976, was a complete remedy for all of the constitutional violations found in the case, and adequate to desegregate the school district. If the Board had implemented this plan and refrained from unconstitutional segregative acts, unitariness will have been demonstrated, and the district court must end its supervision of pupil assignments. As each of the criteria for a unitary system was fulfilled, the defendants theorized, that each aspect could be removed from court supervision. Judge Matsch's December 1983 decision on the bilingual issues, prevented his acceptance of the Board's January 1984 motion for a declaration that the school system was now unitary and that previously ordered remedies had ended the need for further court supervision. Opposition to the Board's motion emerged in February 1984, as lawyers for the bilingual intervenors filed a brief insisting that until all vestiges of segregation, including differences in achievement between minority and 140

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white students were eliminated, the court should deny the Districts motion for release. The plaintiffs pointed to evidence of continued segregation, and leaders of community organizations urged the board to "openly articulate" to the public its commitment to equal educational opportunity. Among the relevant questions which the Board had never answered, according to community representatives was, "whether there was a basis for believing, with reasonable certainty, that there will be freedom from racial discrimination in the futureT (Rocky Mountain News Feb.16, 1984: 8). Feeling public pressure, and the determination of the court, the Board unanimously passed Resolution 2233, which was a declaration of policy guidelines for desegregation the board would use following the termination of court supervision. The lengthy resolution stated that the Denver schools should be operated in conformity with all federal laws, that there shall be no sudden alteration of the court ordered busing plan in effect, that no practices would be taken for the purposes of discriminating against any person, that the Board would attempt to achieve the beneficial effects of integration, and so on. (See Appendix B for Board Resolutions.). The resolution committed the Board to developing additional magnet schools and special programs, and using all available means to ensure that they would be integrated. In addition, the Board said it would develop and actively promote a voluntary program to encourage students to transfer to schools where their race is a minority (Branscombe, Groups Seek DPS Resolve on Equality, Denver Post, March 1 0, 1984, at 7 A). 141

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In April 1984, Judge Matsch began hearings to see if the school district could, in fact, demonstrate that it had achieved unitariness. After less than ten years of experimentation, delay, and litigation the board, administration, and segments of the community felt that the district was prepared to initiate the end to the law suit. There were also many who felt that there was little chance of a release from court jurisdiction, because of the problems which emerged in the DPS in the mist of implementing the court order. Desegregation expert, Dr. Gary Orfield stated, "I think it will get thrown out. The judge has thrown out an effort by the school district to get out from the court order before. He was obviously very impatient then [1982]. He threw it out, one day after the evidence was presented. He described the school district's motion as "a provocative and stupid thing to do ... a slap in the face of the judge."(Enda, Busing: Race Gap Persists, Experts Say, Rocky Mtn.News, April 15, 1984: 1 ). In order to make their case, the school district stretched to hire additional legal counsel and their own expert witnesses. One of those hired by the district was John Michael Ross, a Washington statistician whose statistical explanations for the increase in segregation in the district would confound and annoy the judge. The statistical approach to these issues was an attempt to prove that the significant decline in white enrollments and racial imbalance in the district's schools, was due to demographic shifts, versus any non-compliance with the court order. In response to these arguments based on statistical manipulations the Judge responded: 142

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It is paradoxical that the defendants presentation to this court in support of the subject motion has placed such a heavy emphasis on the use of statistical displays to demonstrate the establish ment of a unitary system when the thrust of the Spangler decision is to decry the rigidity of defining desegregation according to any fixed racial ratio. Both in 1979 and 1982, this court emphasized the importance of recognizing that establishing and maintaining a unitary system requires more than meeting a statistically satisfactory pupil assignment plan. Keyes, 609 F. Supp.1515 (1985). Matsch insisted that from the testimony of the School Board, it was apparent that they had been convinced that desegregation had occurred when measured by the racial balance and racial contact indices. In doing this they had ignored several critical issues. The Board also pointed to the "stigma" that the issue of busing had brought to Denver and its schools, and the negative impact on the city in economic, political, and social aspects. In answering the question as to whether a unitary school system had been established in Denver, it was maintained that, "The argument made that the adequacy of any desegregation plan is, of course, measured not by its intentions, but its effectiveness." Dayton Board of Education v. Brinkman (Dayton II), 442 U.S. 536 (1979). The effectiveness of the implementation of the court order was targeted by Judge Matsch as he relayed his reasons for denying the motion to vacate the case. He pointed to the misunderstanding of the Board in believing that the modifications in the 197 4 decree and "Consensus" plan were an adequate desegregation plan for district desegregation. He also insisted that intentions were not good enough, and presented examples of the how the district had fallen short in a number of areas including: the assignment of minority teachers, abuses in hardship 143

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I I I i I I I I I I I I i I I I I I i I I I transfers and lack of monitoring, racially identifiable programs (magnets) and schools. Plaintiffs argued that the district officials had a general lack of commitment to the established desegregation guidelines. In the mist of this stage of the Keyes litigation, the judge also attempted to lay the groundwork for a negotiated settlement of the case, by encouraging the various parties to work out some of the more contentious details related to the development and implementation of an effective desegregation plan. However, by the beginning of February 1985, the negotiations had broken down on several occasions with stalemates on issues like the continued segregation of several elementary schools in Northeast Denver (Harrington, Barrett, Mitchell, Gilpin-all predominately black). After the parties reported that their extensive efforts to reach a negotiated settlement of the remaining issues had failed, the court entered an order for further proceedings (October 1985), and once again directed the Board to submit plans for achieving unitary status, and to provide reasonable assurance that future Board policies and practices would not cause resegregation. The district was required to address several matters in particular: identification of Barrett, Harrington, and Mitchell as schools for minority children; the hardship transfer policy; faculty assignments, and plans for the implementation of Resolution 2233. 144

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Judge Matsch also reiterated the legal impediment for Denver in maintaining a unitary system once it was established. He concluded that resegregation would be inevitable if the school district complied with state law. He found that the organic law of the State of Colorado was in direct conflict with the pupil assignment plan, which was in effect at the time. He insisted that, "If the courts jurisdiction were removed, it must be presumed that the members of the Board of Education under the oath required by state law (Anti-busing Amendment Colo. Canst. Art. IX, Section 8), will obey this requirement of the state constitution, and dismantle the entire pupil assignment plan." (Keyes, 609 F. Supp. 1491 (1985). The hearings sparked heightened criticism of the Board and its efforts at desegregation. They were again accused of being unresponsive to the outside assistance of the "experts" of the court appointed Compliance Assistance Panel. In response to these observations, the judge revealed that indeed, there were no assurances that the district would not regress: The issue of good or bad faith of those Board members is irrelevant. As the history of this case has shown, philosophical and political views of the elected Board will vary as is to be expected in representative government. Indeed, remembering that this case began when a Board Resolution was repealed by a succeeding Board, little reliance can be placed upon Resolution 2233, or any other resolution, as directing future boards. What must be accomplished in constructing the final and ultimate permanent injunction in this case, is the creation of means and mechanism to prevent any future policy of discrimination, whether it results from intentional governmental action or simply in consequence of a policy of disregard or permissive passivity (/d., at 1515). 145

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With the denial of the district's motion for release from court supervision, came requests for a permanent injunction from the plaintiffs, and instructions from the judge to correct the deficiencies identified in the month long evidentiary hearings. Despite court orders board resolutions, and plans for implementation, the district had again fallen short in its efforts to address the complex issues related to desegregation. The path from an unconstitutional dual system, to one that would meet the criteria of unitariness, would continue to prove elusive In November 1985 the district appealed to the U S Court of Appeals for the Tenth Circuit, regarding the June 1985 opinion and the October 19, 1985 order for further proceedings Notwithstanding the appeal, the district did move ahead with plans to address the concerns raised by the court. A shift in the board majority, and responsive superintendent's during this period, allowed some movement on the development of plans to address the above issues. Hearings on the plans were held until March 1986. In February 1987, Judge Matsch authorized the school district to proceed with the implementation of its plans and policies. In addition, the court noted that a hearing would have to be held on the effectiveness of those plans and operations, and that changes would likely be made in existing orders. Shifting Legal and Political Environment From the mid-eighties into the nineties, there were several changes in the legal and political environment of the lawsuit. First, changes in the superintendency and board leadership, focused the district on the need to 146

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comply with the court order, in order to be released from supervision. However, public criticisms had arisen over the costs of the litigation and the fees spent for court experts, and the pendulum would continue to swing away from support for desegregation efforts. One indicator of this changing landscape, was the May 21st school board election for two school board seats. This election resulted in anti-busing advocate William Schroeder's defeat and a change in the political balance of the board. Quality schools, not busing, was the new code phrase for this election This shift was likely a response to the national education reports (i.e., Nation At Risk), and the emerging national focus on defining "quality education versus equality. Another indicator of waning interest in the schools was that the "political" climate of school board elections attracted less than half of the 12 to 18 percent of off year voter turn out. Two liberals were elected; Edward Garner, a marketing specialist who became the only black member on the Board, and Carol McCotter, a former teacher. Garner said that he would work to stop spending money fighting desegregation in the courts. "What we have to do is follow the dictates of the court and hope it won't be unpleasant for all. .. the board has never bought into the idea of promoting desegregation Unless we do, we will always be faced with expensive appeals." Of those elected during the 1970s, when busing was the paramount issue, only Naomi Bradford remained (Bingham, Garner, McCotter Win Denver School Election, Denver Post, May 22, 1985: 1 A). The legal doctrine and precedents related to desegregation of public schools also began to shift dramatically in the mid-eighties. The 147

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retrenchment in the courts during this period has been documented and analyzed by a number of legal scholars.(Wilkinson 1979; Orfield 1983; Spann 1993). The movement away from desegregation was strengthened in the Nixon and Reagan eras. By the mid-eighties, the shift away from equity issues would emerge in several significant cases, giving hope to the anti busing forces in Denver and across the nation, that this "social engineering" could finally be abandoned. The Interim Decree ( 1987) On February 25, 1987, Judge Matsch issued a ruling relaxing court control over the Denver Public schools. However, since the district had chosen not to increase the amount of busing to integrate the school system for fear that it would have a destabilizing effect, but instead used more subtle methods to achieve a unitary system, the court would retain jurisdiction to insure that the methods were effective. The judge held that: 1.) despite the school district's failure to achieve unitary status, the district's sincere and strenuous efforts to meet the requirements of the desegregation order, warranted reduction of the district's court control in the operation of the school district, and 2.) in view of the proscription against student transportation to achieve racial balance contained in the Colorado Constitution, a permanent injunctive order by the district court was necessary to allow the school district to implement student assignment plans involving mandatory assignment or transportation of students. The judge found that a permanent injunctive order was also necessary because 148

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desegregation related resolutions were not binding on future boards of education. The court rejected the plaintiff's request for detailed monitoring and reporting requirements because the district would probably conduct such data collection and monitoring itself to convince the court that the system was unitary and that court supervision should end (Keyes, 653 F. Supp. 1536 (1987). The principle purpose of this injunctive decree was to enable the defendants to operate the school system under general remedial standards rather than specific judicial directive. This interim decree would remove obsolete provisions of existing orders, relinquish reporting requirements, and eliminate the need for prior court approval before making changes in the district's policies, practices, and programs. The judge saw the interim decree as a necessary step toward a final decree, which would terminate jurisdiction. The timing of a final order would, however be directly related to the defendant school district's performance under the decree. Specifically: Discriminatory intent would not be measured by the good faith and well meaning of individual Board members or of the persons who carry out the policies and programs directed by the Board. The intent is an institutional intent which can be proved only by circumstantial evidence. What the district does in the operation of its schools will control over what the Board says in its resolutions. In the remedial stage of a school desegregation case, the court must be concerned with the affirmative duty to eradicate the effects of past intentional governmental discrimination. When unitary status is achieved, court supervision can be removed when it is reasonably certain that future actions 149

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will be free from institutional discriminatory intent." [Emphasis added] Keyes, 670 F. Supp. 1516 (1987). The elimination of institutional discriminatory intent required the school district to address the following as guidelines for policy and action: 1. The defendants, their agents, officers, employees, and successors and all those in active concert and participation with them, are permanently enjoined from discriminating on the basis of race color or ethnicity in the operation of the school system. They shall continue to take action necessary to disestablish all school segregation, eliminate the effects of the former dual system and prevent segregation. 2. The defendants are enjoined from operating schools or programs which are racially identifiable as a result of their actions. The Board is not required to maintain the current student assignment plan of attendance zones, pairings, magnet schools or programs, satellite zones and grade level structure. Before making any changes, the Board must consider specific data showing the effect of such changes on the projected racial/ethnic composition of the student enrollment in any school affected by the proposed change. The Board must act to assure that such changes will not serve to reestablish a dual school system. 3. The constraints in Paragraph 2 are applicable to future school construction and abandonment. 4. The duty imposed by the law and by this interim decree is the desegregation of schools and the maintenance of that condition The defendants are directed to use their expertise and resources to comply with the constitutional requirement of equal educational opportunity for all who are entitled to the benefits of public education in Denver. 5. The District retains the authority to initiate transfers for administrative reasons, including special education, bilingual education and programs to enhance voluntary integration. The defendants shall maintain and established policy to prevent the 150

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I I I I I I I frustration, hindrance or avoidance of a district student assignment plan through parent initiated transfers and shall use administrative procedures to investigate, validate and authorize transfer requests using criteria established by the Board. If transfers are sought on the ground of "hardship", race, color or ethnicity will not be a valid basis upon which to demonstrate hardship. The defendants shall keep records of all transfers, the reasons therefore, the race, color, ethnicity of the student, and of the effects on the population of the transferee and transferor schools 6. No student shall be segregated or discriminated against on account of race, color or ethnicity in any service, facility, activity, or program (including extracurricular activities) conducted or sponsored by the school in which he or she is enrolled. All school use or school sponsored use of athletic fields, meeting rooms, and all other school related services, facilities and activities, and programs such as commencement exercises and parent teacher meetings which are open to persons other than enrolled students, shall be open to all persons without regard to race, color, or ethnicity The District shall provide its resources, services, and facilities in an equitable non discriminatory manner. 7. The defendant shall maintain programs and policies designed to identify and remedy the effects of past racial segregation 8 The defendants shall provide the transportation services necessary to satisfy the requirements of this interim decree notwithstanding the provisions of Article IX, Section 8, of the Colorado Constitution. 9 (A) The principals, teachers, teacher-aides and other staff who work directly children at a school shall be so assigned that in no case will the racial or ethnic composition of a staff indicate that a school is intended for minority students or Anglo students. (B) Staff members who work directly with children and professional staff who work on the administrative level will be hired, assigned, promoted, paid, demoted, dismissed, and otherwise treated without regard to race, color or ethnicity 151

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(C) Defendants are required to use an effective affirmative action plan for the hiring of minority teachers, staff and administrators with the goal of attaining a proportion which is consistent with the available labor force; the plan shall contain yearly timetables and a reasonable target date for the attainment of the affirmative action goals. 10. The District will continue to implement the provisions of the program for limited English proficiency students heretofore approved by the Court in the Language Rights Consent Decree of August 17, 1984. Nothing in this interim decree shall modify or affect the Language Rights Consent Decree of August 17, 1984, and the prior orders entered in this case relating thereto shall remain in full force and effect. 11. It is further provided that this interim decree is binding upon the defendant Superintendent of Schools, the defendant School board, its members, agents, servants, employees, present and future, and upon those persons in active concert or participation with them who receive actual notice of this interim decree by personal service or otherwise. 12. This interim decree, except as provided herein shall supersede all prior injunctive orders and shall control these proceedings until the entry of a final permanent injunction (Keyes, 670 F.Supp. 1516 (1987). This Interim Decree would provide a more flexible framework for the desegregation of the Denver Public Schools. The timing of a final order would be directly related to the school district's performance under this decree. Boards of education during the late eighties, and into the nineties, would attempt to design the policies and practices of the district according to these guidelines. 152

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The late 1980s passed fairly uneventfully, in respect to the community's awareness and involvement in the desegregation of the Denver Public Schools. The school district would continue in its appeals, which were consistently denied. Anglo and middle class migration would continue out to the sprawling suburbs, which claimed a higher quality of schooling and no mandatory busing, even though only a small number of Denver students were bused for integrative purposes.(S000-7000 or 10-11% of the student population). The Re-Emergence of the Politics of Desegregation The 1990s saw the election of Board members who would attempt to work with the school administration and within the desegregation guidelines established by the courts. The additional flexibility provided by the 1987 Interim Decree, permitted the district to experiment with a variety of educational strategies, including magnet schools, voluntary choice, etc., to promote the integration of the schools, and to attract middle class whites and minorities back to the district. In 1990, the Court of Appeals upheld Judge Matsch's determination of a lack of unitariness and denial of motion to terminate jurisdiction. Minor modifications were ordered to be made in the interim decree. Despite the good faith efforts of the school district, the U.S. Supreme Court refused to hear the Denver School Board's appeal requesting that the district be released from court supervision in 1991 (Keyes, 498 US. 1082 (1991 ). 153

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There was a shift from equal educational opportunity to educational reform efforts during this period. Sparked by the plethora of national reports on the state of American education, the Denver school district would also experience a shift that would call for increasing decentralization and collaborative decision making structure which would move many of the decisions, like school design, to the local school site. With Denver's collaborative decision making committees (CDMs), parents, teachers, and members of the local community, would now have a say in how schools were run. In the mist of these changes, the accountability for issues like equality of educational opportunity also became more problematic. As the 1990s evolved, the school district would also find that the student body had changed drastically, making it impractical and impossible to achieve district-wide desegregation. Since 1974, and the initial implementation of the court order, the student population declined from 96,000 to 63,000. In 1992, two-thirds of the nearly 63,000 students in Denver schools were minorities. In 1968, when the desegregation case began, Anglos made up two-thirds of the student body. Denver became an island of minority students in a sea of anglo students. (See Appendix A for demographic changes). The purpose and practicality of desegregation, had once again become a subject of debate in this changing context. The long battle over desegregation, became the scapegoat of blame for white flight, urban crime, a weakened tax base, etc. The reality of the situation was that Denver's schools were far more integrated in both a racial and socio-economic sense than any of the 154

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neighboring suburban districts that were not subjected to judicial constraints. These districts included nearly majority Anglo school systems such as Cherry Creek, as well as, racially mixed ones such as Aurora and segments of Adams County. In Colorado, Denver's schools were the only ones supervised by a federal judge. Denver, like other school districts in urban centers, was experiencing the impact of declining dollars and increasing needs of a diverse student population. Although the district was able to successfully pass a $200 million dollar bond issue for school renovations and construction, the district would also come under closer scrutiny as to their accountability for spending tax dollars wisely. At the center of these public criticisms, was the amount of dollars the district had spent in its long litigative journey with issues related to desegregation. Each time Denver school officials would go to court to fight busing and lose, they would pay a double legal tab millions of dollars to their own lawyers and those of the plaintiffs. The tab for legal fees since the beginning of the case in 1969 had amounted to approximately 4 million dollars. Another challenge to desegregation came with a school voucher amendment issue on the November 1992 ballot. This was viewed by some as an attempt to resegregate Denver's classrooms, and undo two decades of progress in race relations. Colorado drew national attention as one of the states to place a voucher proposal on the ballot. Under the voucher plan, parents would receive tax money to enroll their children in the public or private school of their choice. Arguments were made that vouchers would 155

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not aid disadvantaged students, the $2,000-$3,000 per child would not be enough for poor families to afford private schools but would serve as a mechanism to drive many middle class families out of the public schools. Dr. Evie Dennis, the superintendent at this critical juncture, argued that, "The idea of choice sounds good but misleads voters because the public schools don't have a choice in the students they educate; the poor, the handicapped, and those with discipline problems. It would leave many minority students trapped in the inner city and create havoc in the effort to maintain a fair mix of all students in school buildings." (Vouchers Worrying DPS Chief: Desegregation Work at Risk, Rocky Mtn. News, Sept .22, 1992}. Even though this initiative to create school choice through vouchers failed, the desegregation of the Denver schools would re-emerge as a political theme into the nineties. In the mist of these changes, the school district would again in 1992, submit a motion to Judge Matsch requesting release from court supervision and a return of control of the district to the board of education. School officials were optimistic about their chances because a more conservative U.S. Supreme Court ended busing in Oklahoma City the previous year (Dowell v, Board of Education, 1991 }. Board president Dorothy Gotlieb, insisted that the district had met the terms of desegregation orders and had an "obligation" to the public to seek an end to busing in a "timely fashion. n Denver Schools Seek to End Busing, Rocky Mtn. News, January 4, 1992). The precedent setting Dowell case, would have a lingering effect on desegregation cases through the nation. 156

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The 1992 appeal to the court for termination of the court supervision, brought a variety of elected officials and other notables out of the political closet. The court action came as Governor Romer, Mayor Wellington Webb, and several of the city's top minority leaders agreed publicly that it was time to put the busing controversy in the past, and get on with the larger task of educational reform. After making a political campaign pledges to seek an end to Denver's school busing order, Mayor Webb assigned members of his staff to begin to work with the district on ending the case. The city filed a motion to intervene in the case in support of the districts efforts seeking relief from court jurisdiction. In making its case for intervention, the city cited a number of "disturbing developments" that Denver had experienced over the past twenty years: An out-migration of the Denver middle class (especially Anglos and blacks) to the metropolitan suburban counties; An increase in the number and percentage of poor families living in Denver with a dramatic increase in the number of families receiving governmental aid; A large decline in the number of families with children living in Denver (especially families headed by both a husband and a wife) with a con-commitment increase in such families in the metropolitan suburban counties. Very low enrollment rate for Anglos students in Denver Public Schools classrooms; Increasing budgetary problems for Denver and an decreasing ability to maintain governmental services as the number of poor families increases; 157

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A strong public perception that a major unit of the government of the City and County is incapable of operating in a constitutional fashion without judicial oversight. (Memorandum in support of motion to intervene, City and County of Denver (1994) Case No. C1499:.2-3 ). As part of the city's effort to end busing in Denver, Mayor Webb indicated to the judge that the city would seek to integrate schools by integrating the neighborhoods around them. Families would be given economic and other incentives to move into areas of town that have been poorly integrated in the past. Denver officials would also consider expanding the dispersed housing program that places families in public housing throughout the city. Supporting documents also quote Webb as saying, that he would back a Denver property tax increase to pay for educational and other programs that might be part of a settlement of the long-standing case ( Busing Solution Offered: Webb: Integrate Neighborhoods, The Denver Post, April 18, 1992). Parallel to the mayor's interest in promoting integration in the schools through integrated neighborhoods, were the efforts of Housing For All, a small non-profit, which tried to get the city and district to offer leadership to develop a plan. Housing For All, was founded as a result of work of a task force put together by the former Mayor Pena and other mayors and commissioners throughout the metropolitan area. Its goals were to eliminate housing discrimination, increase free choices in housing, and promote the integration of housing and schools throughout the metro area. Many interested parties were invited to take part in the development of this integration plan, including the city, the school district, minority groups, 158

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realtors, neighborhood groups, and business leaders (DPS Busing is a Symptom, Not the Problem, Denver Post, January 15,1992). Meetings were held over a year, and the Housing For All effort produced a number of recommendations and strategies, which have been largely ignored. Black and Hispanic Coalition Attempts to Negotiate a Settlement As the school district moved to return to court, members of the minority communities felt that this was a opportune time to attempt to work with school officials to negotiate a compromise agreement to settle the case. Talks were launched in 1991, after a group of Hispanic leaders argued that the costs of busing and legal fees, had drained the district's general fund and done more harm than good for minority students. By 1992, African American leaders joined the talks, and Mayor Webb also had a representative involved. A school district lawyer joined the talks as well, with the understanding that the school district was not negotiating anything, only discussing issues. In these "negotiations", it was suggested that the school district ought to pursue a negotiated settlement to the school integration lawsuit. Judge Matsch, in fact, had ordered the parties as far back as 1985 to attempt to negotiate a settlement. It didn't work then, and there was skepticism as to whether it would work this time. Both African American and Hispanic leadership, brought to the table their own ideas of what was required of the school district at this particular juncture. The outspoken editor of the Denver Post, AI Knight, questioned the validity of this approach 159

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I and the so-called "political opportunists", who were in his view, holding the school system hostage. [T]he Black and Hispanic leaders who are making their list of settlement demands are offering to trade minority support for the removal of the court order, but only if they are able to impose new conditions. It is as though the school district is being told it can cast off its old set of court-ordered shackles, only if it agrees in advance to put on a new set-those tailored by the minority spokesmen. There is a second problem here. Most of them, unlike Webb, who holds elected office, have never been elected to anything. They speak for no identified constituency based on anything other than ethnic or racial factors, and some of them lack any background or credentials in the broader community ... That is why it would be a poor bargain for the Board to sign agreements that have the happy effect of ending court jurisdiction only to burden the district with a new set of constraints and new layers of obligations (Fighting a Tide of Bad Advice: DPS Board is Right to Return Case to Court, The Denver Post, January 25,1992). After months of meetings with the black and Hispanic communities, in May of 1993, the school board rejected their desegregation proposals designed to end busing for integration. These proposals addressed many of the persistent disparities between minority and Anglo students. The Board claimed that the coalition's proposals were too costly and would not free the school district from the court's jurisdiction until 2003. The Board claimed that it would cost over $50 million dollars to implement programs and add facilities requested in the proposals. The district also pointed to an "obvious lack of consensus within both the black and Hispanic communities". The failure of this second attempt to negotiate, brought sharp criticism from the 160

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. I minority communities, but district officials felt that both the legal and political climate, were ripe for a potential release from the court order. Instead of negotiating with the minority communities, the school board would instead press for an answer from Judge Matsch. Shifting Legal Doctrine and the Limits of Desegregation The optimism felt by the Board and school officials regarding the potential for release from court jurisdiction, was well grounded in the shifting legal doctrine regarding desegregation which emerged in two cases which were brought to a close in the early 1990s. These cases were the Oklahoma case, Board of Education v. Dowell, 498 U.S. 237 (1991 ), and the Georgia case Freeman v. Pitts, 503 U.S. 467 (1992). Gary Orfield and others have labeled these cases as the "resegregation cases". Instead of clarifying how to implement effective desegregation plans, this shifting legal doctrine laid the groundwork for the termination of desegregation cases throughout the country. These cases would ultimately be used as the standard for assessing measuring the Denver district's status and the future of desegregation in the city. In the Dekalb County Georgia case, the Supreme Court moved from the requirement of the removal of discrimination "root and branch", to a position that public schools may achieve racial integration incrementally-a piece at a time. This 8-0 decision gave authority to relinquish supervision and control of school districts in incremental stages, before full compliance 161

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has been achieved in every area of school operations. Justice Anthony Kennedy wrote in his opinion. "Residential housing choices and their attendant effects on the racial composition of schools, present an ever changing pattern, one difficult to address through judicial remedies. A school district is under no duty to remedy imbalance that is caused by demographic factors." (/d., at 469). The key question that federal judges must answer in deciding whether school districts have complied with desegregation orders, is whether the lingering racial imbalances are due to policies or demographics. The Judges listed three factors federal judges should consider in making such partial-withdrawal decisions: 1 Whether there has been full and satisfactory compliance by school officials over all those aspects over which supervision is to end, 2. Whether continued court control over all aspects is needed to achieve compliance in other areas; 3. Whether a school district has demonstrated to the public and to the parents and students of the once-disfavored race, its good faith commitment to integration (Freeman v. Pitts, 503 U.S. 467 (1991 ). Although there are some significant factual distinctions within these cases, one central theme is the court's attention to the issue of "vestiges" of discrimination. Areas that can, or may be addressed in considering vestiges are: student achievement, student discipline, special education, racial and ethnic composition of schools, racial and ethnic composition in assignment of faculties, school attendance areas, and student transfers. Denver schools, according to the lawyer for the plaintiffs, Gordon Greiner, had not 162

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met court-mandated standards in two key areas-student and faculty integration. A third issue in evaluating desegregation in Denver, was whether the district's student transfer policy had continued to provided an escape hatch for those wishing to avoid integration. In November 1992, Judge Matsch set a hearing for the purpose of determining the nature of the hearing to be held on the school districts motion for release for court jurisdiction. The court vacated a November hearing date because of the continuing settlement negotiations. When the negotiations between the school district and the minority communities broke down, the court set a hearing for October 8, 1993, on the issue of the scope of the evidentiary hearing to be held on the school district's motion, and to determine the motion of the City for leave to intervene. The city's proposed role in seeking an end to federal supervision of desegregation was broader than the other parties in the case wanted. The school district welcomed the city as a friend of the court, but opposed the city of Denver as an intervenor. Gordon Greiner, the lawyer for the families that brought the case in 1969, said in court papers that the city's intervention would introduce irrelevant issues. Denver city officials were "stunned" by the parties opposition to its intervention in the remedial stage of the case. In response to the rejection of assistance, city officials wrote that, "Mayor Webb is deeply offended by the plaintiffs insulting remarks that Denver's motion to intervene merely discharges a "campaign promise ... to end busing" and that he would be content to accept the resegregation of Denver schools." (Plaintiff's Brief, 1994: 7). And further, "Denver's motion to 163

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intervene is supported by Anglo and minority people, who believe that this is the appropriate time for the Court to terminate jurisdiction. What is especially galling is their statement that the Mayor brings to the case nothing of relevance." (/d., at 15). State Demands End to Racial Busing One of the most nagging legal issues confronting Judge Matsch in his consideration of whether Denver schools would be released from court jurisdiction, was the implications of the 197 4 Anti-Busing Amendment to the Colorado Constitution. Over the duration of the case, Matsch worried that the state could dismantle Denver schools integration policies if court ordered busing was ended. The state's intervention posed a stumbling block for Denver schools in their effort to be freed of the court order. In its own brief the Board told Matsch: "If the board were to adhere to its policies following termination of jurisdiction it will immediately face the threat of new litigation based on the Colorado constitution. On the other hand, if the Board were to abandon its policies and comply with the apparent command of the Colorado constitution, it would in all likelihood be faced with renewed litigation charging it with purposeful discrimination ( Board Brief 1994: 5). The district argument also suggested that the Colorado Constitution might render illegal any magnet schools where racial criteria are used as a factor to determine who is accepted. Magnet schools such as Knight Fundamental Academy, and programs like the International Baccalaureate, and others, had been 164

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used by the district to "voluntarily" draw students out their neighborhoods and desegregate schools across the city. In 1993, the federal court asked the State of Colorado to submit its views regarding the constitutionality of the Anti-Busing Amendment. This provision provided that "no pupil shall be assigned or transported to any public educational institution for the purpose of achieving racial balance. n Without discussion with the plaintiffs or defendants in the case, Attorney General Gale Norton and her legal staff submitted a motion and brief to the court. They insisted that the anti-busing clause was constitutional. Specifically, they said: In enacting the Busing Clause, the people of Colorado simply established a constitutional policy against race-based decision making and in favor of a general policy of neighborhood schools. Although the provision is binding on all 176 school districts in Colorado, it does not affect the authority of a federal court to order mandatory busing to remedy violations of the Fourteenth Amendment to the United States Constitution. Nor does the policy affect the power of local school districts to bus students for other purposes. Since the busing clause refers only to race, by its clear terms, it does not apply to assigning students to eliminate overcrowding, ensure access to special programs, or promote magnet schools. Thus, the only thing prohibited by the Busing Clause is for a school district to use race in determining where that student should go to school (District Attorney's Brief:14). Norton offered a free-market-style plan that would allow Denver students to choose any school they wished to attend, and to make schools compete for students. Busing to achieve racial integration, violated the 165

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Colorado Constitution by restricting where students can go to school. However, these types of efforts to promote "voluntary" integration of the Denver schools, had been rejected by the courts in the past (Green), and had proven to be ineffective in promoting any significant desegregation. Equal Opportunity on Trial Twenty-five tumultuous years of court-ordered busing had forever changed Denver, shaping its social, political, and economic landscape. On August 22, 1994, Judge Matsch would hear the last round of evidence to determine the future of desegregation in Denver. The Denver school system would once again go on trial to assess its treatment of minority students. Judge Matsch would hear argument from administrators and board members who would insist that all remnants of discrimination had been buried, and that federal court oversight of the Denver Public Schools was no longer necessary. As the case moved through the courts for twenty-five years, there were many changes in the district. As busing fueled the flight of thousands of anglo and middle-class families to the suburbs, the district was transformed from a predominantly Anglo school system with 96,000 students to a predominately minority district of 63,000. The number of Hispanic students grew to represented approximately 60% of the district's pupils. The number of school children bused for racial integration had declined from a high of more than 20,000 in the early 1970s to fewer than 7,000 in the nineties. The complexity of the issues related to providing equal educational 166

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opportunity also increased with the growing number of students coming from single parent and families requiring government assistance. The decentralization of decision making in schools through the collaborative decision making committees (CDMs) at each school site, had altered the management structure of the schools. And despite the long protracted struggle for equal educational opportunity through desegregation, minority students still lagged behind Anglo students in critical areas. As the case proceeded into court for its last journey, issues related to the success or failure of Denver's desegregation experience would be hotly debated in the press, and throughout the community. In the minority communities there was a mixture of opinion. Hispanic activist, Nita Gonzales, said that she never felt that cross-town busing was an appropriate mechanism to fix discrimination. "But that doesn't mean its time to end federal supervision of desegregation." (Hispanic Activist, Others Miffed, The Denver Post, Aug. 18, 1994). Former school board member Rachel Noel insisted that she didn't believe that the Denver schools were ready to be released. "I don't think the record will show that all things the court has ordered have happened." (ld). The assessment that desegregation in Denver did not lead to equal educational opportunity, had influenced minority leaders in both the African American and Hispanic communities who once supported these efforts, to urge a return to neighborhood schools. For many leaders in the black community, it was time to end-court ordered busing because black students had historically born the burden of this effort, with little results in terms of achievement in particular. 167

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Although busing had outlived its usefulness for many in the minority communities, the question still remained as to whether neighborhood schools would mean better schools? Researchers with the Harvard Project on School Desegregation warned that cities that return to neighborhood schools, may experience resegregation. With housing patterns and discrimination continuing in Denver, this would surely be the case. A Harvard study in Norfolk, Virginia, showed that gains expected when the federal court allowed that city to dismantle its school desegregation plan never materialized. Instead researchers saw a sharp increase of concentrated poverty and racial isolation in the city schools across the nation (Orfield and Eaton 1996 xvi). The evidence was that in dismantling cities across the nation, neighborhood schools were no panacea. There is no evidence to suggest that it leads to higher achievement. The arguments for neighborhood schools were persuasive, but many had ignored the fact that even in Denver's neighborhood schools (Hispanic community in particular), the historical disparities had continued. The issues debated in these hearings, went beyond busing to include several additional concerns. The search for "vestiges of past discrimination", !ed the plaintiffs in the case to explore district operations beyond the ethnic breakdown of school populations. Questions were raised as to whether discrimination was still present in the district's current policies and practices. Some of the issues on which the judge heard testimony and debate included: 168

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I I j I I i I I I Disproportionately higher numbers of minority dropout and disciplinary cases, along with disproportionately fewer minority students in advanced classes; The shortage of minority teachers; Under representation of minority parents on school collaborative decision-making teams. Resegregation in the student bodies of several schools The four days of hearings demonstrated that the Denver Public Schools had failed to completely correct the unfair way minority students were treated despite the good intentions of the board and administration. In a shift of opinion from the beginning of the trial, the attorney for the plaintiffs Gordon Greiner in closing arguments, claimed that too few minority teachers were being hired, minority students were being suspended at higher rates than whites, that too many blacks and Hispanics were dropping out, and that not enough minorities were being drafted into the classes for the best and brightest (Court Asked to Keep Bias Watch on DPS, The Denver Post, August 26, 1994). Greiner encouraged Judge Matsch to retain partial control of school district operations in order to force the district to develop plans to address these persistent disparities. Before the trial, Greiner had indicated that he didn't think extending court supervision was necessary. His shift in position occurred during the trial when he became convinced that the district's efforts, particularly on minority hiring, were too weak (Denver Post, August 26 1994). The statistics that emerged during the trial, showed that the rate of minority hiring by the district wasn't even enough to maintain what he considered to be a poor level of minority representation on the 169

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district's faculties. At the time of the trial, 22 percent of the 3,800 teachers were black and Hispanic, but Hispanics and blacks comprised 64% of the student population. Greiner's position was bolstered by AI Kaufman, who represented the Congress of Hispanic Educators in the trial. CHE had intervened in the case on behalf of Spanish-speaking students. Kaufman was even more emphatic about the need for the judge to retain jurisdiction. He criticized the district for the over-representation of Anglo students in accelerated classes. And with so few minority teachers, he argued, there are 43 black students for every black teacher and 57 Hispanic students for every Hispanic teacher. On the other hand, he pointed out there are seven white students for every white teacher (Denver Post, August 26, 1994). Michael Jackson, the lawyer for the school district, argued that testimony from the superintendent, board members, school principals and others had provided strong evidence that all actions of the district had been without any purpose or intent to discriminate. A number of witnesses including school board president, Tom Mauro, pointed to the variety of social problems that were outside of the district's control, as significant factors contributing to the persistent disparities. As part of these hearings, the judge would also have to consider the implications of the Amendment to the Colorado constitution, which prohibited busing for racial balance. Colorado Solicitor General Tim Tymkovich, acknowledged that the present plan would have to be modified, but that integration could be achieve by enticing students to magnet schools and through other voluntary means. Greiner called the state's legal position 170

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"rather sad" because it doesn't deny integration is a good idea, but argues that it can't be specifically sought as a goal. "You put all these programs into place in hopes that you attain some inadvertenUaccidental integration, because integration policies can't be stated without breaking the law (Denver Post, August 26, 1994 ). The August 1994 proceedings would end with little fanfare or controversy. The fate of desegregation in Denver was again squarely in the hands of the Judge Matsch. It would be a year before he would had down his ruling. In the interim, the school district would make moves to further cut back on the busing of students. In what was labeled a history making move, in May 1995, the school board de-paired nine elementary schools which meant that these Anglo and minority students would no longer be bused out of their neighborhoods to integrate schools. The move was rushed through by board members frustrated by the lack of improvement in minority student achievement, which had continued to decline. The end of busing between these schools, would make four schools in north Denver ninety-percent Hispanic or Black. As the school district and community waited to hear from Judge Matsch, a new superintendent would be hired (lrv Moskowitz), and the membership of the Board would change. Final Ruling: Court Ordered Desegregation Ends in Denver The headline in the September 12, 1995 edition of the Denver Post read "Busing Dead in Denver". Judge Matsch had finally lifted the busing 171

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order and returned control of the school district to the school board after nearly twenty-five years of court intervention. However, there were concerns of the plaintiffs and intervenors that the "good faith efforts of future boards" was not enough guarantee that critical issues would be addressed, and that partial release from court jurisdiction through a permanent injunctive order was required. There were different opinions as to whether the district had yet realistically achieved their goals relative to unitary status. Plaintiffs and intervenors pointed to issues like the continuing disparities in achievement and disciplinary numbers between minority and Anglo students, minority hiring, and the under-representation of minorities in gifted programs. Despite these lingering concerns, Judge Matsch completely severed the judicial hold on the district regarding desegregation issues, with the exception of the bilingual aspects of the case, which stood on their own statutory ground. With this exception, the judge found that" it is now determined that defendant School District No.1, Denver, Colorado (District), has complied in good faith with the desegregation decree entered in this case and that the vestiges of past discrimination by the defendant have been eliminated to the extent practicable." (Final Decree, 1995:1 ). In explaining the status of this case in the context of the most recent desegregation precedent, Judge Matsch insisted that, "The Supreme Court has provided "new guidance for trial courts in bringing school desegregation cases to a close." (/d., at 11) He went on to state that: 172

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This court's assumption that this civil action would end with a final injunctive order was removed by the Supreme Court in Board of Education of Oklahoma City v. Dowell, 489 U.S. 237 (1991 ). There the Court reversed the Tenth Circuit Court of Appeals and said that injunctive orders in school desegregation cases differ from equitable decrees in antitrust and other types of litigation. The Supreme Court directed federal district courts to close these school cases with final orders relinquishing jurisdiction and returning full governance of the schools to local control, when the defending district makes a sufficient showing that it has achieved unitary status. In Freeman v. Pitts (1992), the Court ruled that school districts could be partially released from their desegregation responsibilities even if integration had not been fully achieved in all the specific areas outlined in the Green decision. Addressing issues related to the disparities and "vestiges of past discrimination" which remained, was beyond the scope of this case and the continued jurisdiction of the courts according to Matsch. "The constitutional authority of the federal courts is limited to compelling the elimination of negative effects of de jure discrimination; it does not include the power to posit any particular affirmative achievements." Moreover, the judge insisted that Freeman v. Pitts ( 1992), Dowell ( 1991), and Missouri v. Jenkins, 115 S. Ct. 2038 (1995), had established the standard for measuring the defendants present position. With these cases, the Supreme Court had reminded district courts of their duty to recognize that educational policy is to be determined through the democratic process. With these precedents, the Court limited the power of the judiciary to deal with the issues of desegregation and equal educational opportunity. Matsch also found that The Supreme Court's opinion in Missouri v. Jenkins (1995) defeated the 173

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plaintiffs call for compelling additional action to investigate and redress racial disparities in student achievement, and participation in special programs for gifted and talented pupils. This court has never made any findings that such disparities are the result of discrimination by the District. On the contrary, ten years ago this court said: [T]here is nothing in the law which does or could require equality in the results of educational services ... No school policy and no court order can assure any particular level of success in public schools any more than in any other aspect of life. Individual students will flunk, become disciplinary problems, drop out, or otherwise fail to meet expectations for reasons wholly unrelated to race, ethnicity, and environment. Keyes, 609 F. Supp, at 1515 (1985). The evidence presented in the August 1994 hearings did not demonstrate to the judge any finding of new discriminatory conduct related to these issues, even though some would disagree. To obligate the district further, would go beyond the remediation of past discriminatory conduct. The Districts "good faith effort" was demonstrated in the facts regarding the district's effort to comply with the provisions of the Interim Decree (1987). This had been achieved in the actions taken by the board in regard to: 1.) correcting the racial isolation at Barrett, Harrington, and Mitchell elementary Schools; 2.) implementing and administering the Hardship Transfer policies to prevent abuse; and 3.) in the implementation and monitoring of modifications in the District's Teacher Assignment Policy. The judge was also impressed with the manner in which the district had exercised discretion under its Resolutions 2233 and 2314, in the 174

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reorganization, closure, de-pairing of schools, and in the creation of special educational programs. The nagging legal issue of the Colorado Anti-Busing Clause and whether it was in violation of the Fourteenth Amendment, was also addressed directly by the judge. Plaintiffs, plaintiff-intervenors, and the school district sought, a judgment on this issue because they contended that this state restriction would have an adverse affect on the ability of the district to implement Resolutions 2233 and 2314 related to desegregation and equal educational opportunity. In response to this concern, the judge admitted that the removal of the court-order would remove the Denver district from its unique status among Colorado schools districts. Removal of federal jurisdiction over desegregation issues would require the district to comply with Colorado, and other federal laws, which impact the operation of schools. In respect to the Busing Clause. The judge writes: The Busing Clause in the Colorado Constitution and the statutes applicable to public schools will present many challenging questions as Denver continues to provide educational opportunities in a multiracial, multicultural society. The only question now before this court is whether the Busing Clause is incompatible with the district's duty to provide educational opportunities without racial or ethnic inequalities. The answer is no. The words "integration" and "desegregation" are not synonyms. Brown v. Board of Education and all of its progeny hold that the Constitution prohibits segregation of races in public schools with a purpose to impose disadvantages because of race. There is no constitutional corollary requiring the mixture of races according to some formula reflecting the constituency of the community served by a single school system. Thus. de jure racial segregation is prohibited 175

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but racial integration is not required. (Memorandum and Order, 1985:15) The judge went on to indicate that the Busing Clause is consistent with the Fourteenth Amendment, because the restriction on the authority to assign or transport pupils to public schools, is applicable only when used for the purpose of achieving racial balance. The constitutional restriction on the use of governmental power to base policy decisions on racial criteria was consistent with the ruling in opinions such as Pasadena City Board of Education v. Spangler. 427 U.S. 424 (1976), and Adarand Constructors, Inc. v. Pena, 115 S. Ct. 2097 (1995). There is, in essence, no constitutional right to any particular degree of racial balance. Thus, the Supreme Court had drawn a distinction between the temporary use of racial markers to remedy the effects of unlawful discrimination and the use of such racial identifiers for other governmental purposes, including educational policy. The judge also pointed to other state and federal statutory requirements which the District was obligated to follow. (See Appendix C for laws impacting the current legal context for the operation of the Denver Public Schools). In absence of court jurisdiction, Matsch felt that these laws would provide protections against equally discriminatory behavior and that, A reading of these laws demonstrated the influence and effects of the greater empowerment of minority groups that has occurred since the Supreme Court first ordered the desegregation of the public schools in Brown v. Board of Education of Topeka, Kansas. 176

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In his concluding remarks, Matsch observed that throughout the years of litigation: [l]t has been necessary to return to the courtroom ... using the adversary process to resolve factual and legal issues. Each hearing generated expectations and disappointments. Public comment has been extensive. At times criticism became calumnious. Most of the public focus has been on forced busing-the crudest yet most common of the tools used in school integration. This case has not been unique. It is but one of many such cases across the country. What is most common in the history of all of those cases is uncertainty. Thousands of pages have been written by scores of federal judges attempting to articulate guiding principles under the broad constitutional concept announced in Brown v. Board of Education, 347 U.S. 483 (1954). What has been demonstrated most clearly is that courts using the adversary system were not designed to accomplish institutional reform. The Supreme Court has recognized in its most recent relevant opinions that the framers of the Constitution put their faith in the people and the democratic process to provide for the general welfare. The Denver now before this court is very different from what it was when this lawsuit began. The current Mayor of Denver is Black. His predecessor was Hispanic. A Black woman has been Superintendent of schools. Black and Hispanic men and women are in the city council, the school board, the state legislature and other political positions. Business and professional leadership is multiracial. People of color are not bystanders. They are active players in the political, economic, social and cultural life of the community. Their influence has contributed to the enactment of legislation which will affect the future of public education ... Their voices will be heard in the Denver school system. There is little danger that they will permit the public schools to deny then full participation. (Final Decree, 1995: 64-65) The community reaction to the release of the Denver Public Schools from court jurisdiction has been mixed. Uncertainty, as the judge admitted is 177

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still the central theme, particularly when it comes to addressing the persistent issues related to the disparities between Anglo and minority students. Some felt that the school district had finally admitted the failure of desegregation, and the return to neighborhood schools would result in an increase in schools with Black and Hispanic student populations of over 90 percent. Rachel Noel, who has observed the beginning and end of desegregation, commented that, u I hear black people say, let us have our own schools .. but our children will get lost in the shuffle The school board will say otherwise, but I don't believe people have thought about the consequences And then sometimes I ask myself, why should I waste my breath? I wonder if anyone's listening?" (Rocky Mtn. News, May 1, 1995) In the next chapter, the findings regarding the impact and interrelationships between the managerial, political, and legal aspects of this case history will be discussed, along with policy implications of the unfinished agenda of Keyes. Reflection on this history, is critical to the future of desegregation and equal educational opportunity at the dawn of the new millennium. 178

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REFERENCES-CHAPTER V Bell, Derrick. 1980. ed. Shades of Brown: New Perspectives on School Desegregation New York: Teachers College Press. Brown, Kevin. 1992. "After the Desegregation Era: The Legal Dilemma Posed By Race and Education". St. Louis Law Review. 37: 898. Crenshaw, Kimberle eta/. eds. 1995. Critical Race Theory: The Key Writings that Formed the Movement. New York: New Press. Delgado, Richard and Jean Stepahic. 1995. "The Social Construction of Brown v. Board of Education: Law Reform and the Reconstructive Paradox," William and Mary Law Review. 36 (2): 547-570. Fishman, James J. and Lawrence Strauss. 1989. "Endless Journey: Integration and the Provision of Equal Educational Opportunity in Denver's Public Schools: A Study of Keyes v. School District No1". Howard Law Joumal32: 680-681. Liebman, James S. 1990. "Implementing Brown in the Nineties: Political Resconstruction, Liberal Recollection, and Litigatively Enforced Legislative Reform. Virginia Law Review. 76: 349-420. Hochschild, Jennifer L. 1984. The New American Dilemma: Uberal Democracy and School Desegregation. New Haven: Yale University Press. Orfield, Gary. 1983. Public School Desegregation in the United States 1968-1980. Washington D.C.: Joint Center for Political Studies. Orfield, Gary and Susan Eaton. 1996. Dismantling Desegregation: The Quiet Reversal of Brown v. Board of Education. New York: W.W. Norton and Co. Spann, Girardeau. 1993. Race Against the Court: The Supreme Court and Minorities in Contemporary America. Publisher? Wilkinson, J, Harvie Ill. 1979. From Brown to Bakke: The Supreme Court and School Desegregation:1954-1978. New York: Oxford University Press. Cases Keyes, 540 F. Supp. 399 (D. Colo. 1982). Keyes, 576 F. Supp. 1503 1521 (D. Colo. 1983) Keyes, 609 F. Supp. 1491 (D. Colo. 1985}. 179

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I Cases Keyes, 540 F. Supp. 399 (D. Colo. 1982). Keyes, 576 F. Supp. 1503 1521 (D. Colo. 1983) Keyes, 609 F. Supp. 1491 (D. Colo. 1985). Keyes, 653 F Supp. 1536 (D. Colo. 1987). Keyes, 670 F. Supp. 1513 (1987). Keyes, 498 U.S. 1082 (1991) (Certiori denied) Keyes, (Memorandum and Order: Judgement, September 12, 1995): 1, 11, 15. Green v. County School Board of New Kent County, 391 U.S. 430 (1968) Pasadena City Board of Education v. Spangler, 427 U.S. 424 (1976). Board of Education v. Dowell, 498 U.S. 237 (1991). Freeman v. Pitts, 503 U.S. 467 (1992). Missouri v. Jenkins, 115 S.Ct. 2083 (1995). Adarand Constructors, Inc. v Pena, 115 S.Ct. 2097 (1995). Other legal Memorandum in Support of Motion to Intervene, City and County of Denver (1994) :2-3. Plaintiffs Brief on Motion of Intervention of the City and County of Denver (1994): 7,15. District Attorney (Gale Norton) Brief Regarding the Constitutionality of the Colorado Anti-Busing Clause (1994):14 Board Brief on the Impact of Anti-Busing Clause of the Colorado Constitution (1994): 5. Newspaper Articles Denver Post, February 10, 1984. Rocky Mountain News, February 16, 1984:8 Denver Post, March 5, 1984:7A. Rocky Mountain News, April15, 1984:1 Danver Post, May 22, 1985:1A Rocky Mountain News, January 4, 1992. Rocky Mountain News, September 22, 1992. Rocky Mountain News, May 18, 1994. Denver Post, August 18, 1994 180

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I I I I I I I I I I I I i I I I I I I I I I I I I I I I I I I I I I I I I I CHAPTER VI A JOURNEY FULL CIRCLE: DISCUSSION OF FINDINGS AND POLICY IMPLICATIONS Desegregation becomes a process through which a city reconsiders its history and revisualizes its future. When this happens, a great deal more than classroom teaching and learning are at stake: race relations, property values, character of leadership, values of universality and inclusiveness, and economics of commerce and housing are all placed on the scale of racial justice (Willie et. al. 1991: 44). The national debate as to whether desegregation has had a positive or negative impact on the nation's public schools is ongoing The debate in the public arena, and in the literature reflects a diversity of opinions as to the failure or success of this public policy However, when we assess the impact of the Keyes case on the schools and community of Denver, the essential questions we must ask are: Was this the correct or most effective policy approach for achieving equal educational opportunity? What was it that we were trying to accomplish? And, was the desegregation of schools, primarily through racial balance, a good way of attaining these goals? The evaluation of the impact of desegregation in Denver, clearly depends on the vantage point provided by one's perspective. As the end of Denver's desegregation era became apparent, there was no shortage of 181

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opinions regarding the significance of Keyes to the city and its schools. Former Denver School Board member (1973-79), and current city councilman, Ted Hackworth insisted that, "As a result of the lawsuit, two generations of kids in the city of Denver have had their education suffer because of the lawsuit" (Rocky Mountain News, Aug. 18, 1994 ). The media reported that, "Desegregation divided the city for a generation ... and busing has fueled the flight of thousands of Anglo and middle class families to the suburbs and private schools. Denver has been transformed from a predominantly Anglo school system with 96,000 students to a predominantly minority district of 63,000" (Rocky Mountain News, Aug. 28, 1994). One editorial proclaimed that, "Court-ordered busing for the sake of busing is a failure. The time and money squandered on this counterproductive chimera can be used to far better to prepare Denver's children for the challenges of the future" (Rocky Mountain News, April 2, 1992). "Twenty five years of tumultuous years of court-ordered busing have forever changed Denver, shaping its social, political and economic landscape" (Rocky Mountain News, August 18, 1994). Still a different viewpoint, is that Denver has come a long way from the pre-Keyes era. Other critics argue that, "The court order had become a convenient political excuse for conservative forces seeking to maintain the status quo and avoid reform." (Rocky Mountain News, August, 18, 1994 ). (The Denver Post, January 23, 1992). Long time columnist, Gene Amole writes that, "There has been social change, but it was unintended change. The court order triggered a white flight to the suburbs, leaving behind disadvantaged 182

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children of color who were suppose to benefit from desegregation. We quickly learned that busing was no magic bullet to cure the core city's educational ills" (Rocky Mountain News, May 19, 1994). The impact of court-ordered desegregation on Denver and its schools was significant. What it didn't impact were the disparities between Anglo and minority students that it was designed to repair. Rachel Noel, the first black member of the school board said that, It seems that it has not improved that much ... The federal court should maintain its supervision of school desegregation ... I'm very nervous that pressure political and other influences-might be a return to some of the ways that were." (Rocky Mountain News, Aug., 25, 1994). There is concern in the African American and Hispanic communities that there may be a "full circle" return to the pre-Keyes segregation and inequality. This concern is grounded in the issue of whether the district officials, present and future, can indeed be trusted to fulfill goals of equal educational opportunity without the oversight of the courts. Denver's experience with desegregation has been a complex and intriguing saga. Keyes did stir the quest for racial justice in schools and the city. Whether the case has encouraged the city and school officials to reconsider history or to revisualized its future remains to be seen. The history of this case, as filtered through the managerial, political, and legal lenses of a public administrative framework demonstrates how the politicization of busing, shifting legal doctrine, and the challenge of managing a moving target, made the efforts to desegregate the schools 183

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more problematic than anticipated. Throughout this history, we find that the convergence of managerial, political, and legal aspects of this case created multiple constraints and barriers to desegregation as a strategy for achieving equal educational opportunity. Uncertainty, as judge Matsch pointed out in his 1995 Memorandum, is the central theme regarding this case and the future of educational opportunity. In this chapter, the writer once again focuses the conceptual lenses of public administrative to interpreting the history of Keyes as viewed through the conceptual lenses of public administration. Themes and issues emerging from court documents, news articles, and archival documents, reveal that the managerial, political, and legal paths of this case are consequential to the historical assessment of this case on Denver and its schools. This history also reveals the limitations of each of these approaches to desegregation policy, and tensions between them. In addition, he convergence of evidence, as viewed through the conceptual lenses of public administration uncovers: 1. )the structural and systematic aspects of the managerial, political, and legal constraints and barriers to the desegregation of the Denver schools; 2.) the persistent issues and themes related to desegregation and the provision of equal educational opportunity ; and 3.) the challenges for public administrators charged with seeking equity and quality through policy and practice. Demographic and economic changes have influenced history and will help shape the future of desegregation in Denver. However, the impact of managerial, political, and 184

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legal aspects of this case demand attention, because they reveal key actors and influences on Denver's desegregation experience. The view from the vantage point of these lenses, also limits the ability to suggest simplistic answers or reductionistic explanations regarding the impact of this case. One popular tendency is to blame students of color and their families for the intractability of unequal educational opportunity. Bell curve philosophers, for example, have been persistent in their limited beliefs that genetic inferiority or cultural disadvantage, are the sole causes for the continuing disparities. Viewing the history of this case from a broader conceptual base, contextualizes desegregation within a framework that moves us beyond this type of scapegoating. Focusing the Managerial Lens on Keyes The managerial aspects of the implementation of court-ordered desegregation in the Denver schools is an often overlooked aspect of this city's desegregation history. The planning and management of desegregation strategies, have historically been the most problematic of the three approaches explored in this study. Public school administrators responsible for desegregation, not only have had to effectively manage multiple issues, but respond to the changing legal doctrine and the politics of public pressure. The managerial context of public school desegregation has evolved from merely insuring against physical segregation, to dealing with a 185

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complex set of requirements related to representativeness, equity and accountability. It is no wonder that politicians, and the public generally, have become so critical of public bureaucracies like the public schools. Rosenbloom (1986: 28) reminds us that, "It is virtually impossible to satisfy frequently all the managerial, political and legal/constitutional demands place on public administrators and public agencies. They stand on very shaky ground that is always likely to crumble beneath them." Over the span of the Denver case, the "politically" correct practice of establishing citizen advisory committees, were instituted to reflect the political values of responsiveness, accountability, etc. The Denver case illustrates how the efficiency, effectiveness, and economy values of the managerial approach to desegregation are frequently in tension with those of the political. Although politically correct, representative and responsive, the committee approach to desegregation planning would often get bogged down with politics. These efforts required considerable time and dollars, only to have these recommendations abandoned with the appointment of the next desegregation related committee. The "committee" approach to desegregation created frustration for the administration as they tried to manage the court case within the legal mandates, and respond to a variety of political interests simultaneously. In the earliest days of responding to the elimination of the segregation in the Park Hill schools, district officials recognized the depth of the task at 186

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had. In reporting to the district court on the preparations effort to desegregate, officials insist that: The plan development for the desegregation and integration has, of necessity had to be designed around existing environmental and operational considerations. Considered among these have been current practices and problems in Denver, review of research, establishment of criteria including the effect upon the educational program and the continuation of quality educational opportunity efficient utilization of plant capacity, financial limitations of the school district, community characteristics, and the role of transportation (Interim Report, February 1971 :2). Despite the development of elaborate plans for desegregation in Denver, the implementation processes and the measured outcomes fell short consistently. Several issues challenged management throughout the duration of the case. These include the disparities in student achievement. the disproportionate numbers of minority students subject to disciplinary procedures, the recruitment of minority faculty and administrators, the participation and representation of minority parents, equal access to special programs. These issues have been historically pointed out by the plaintiffs and recognized by the judge a vital to equal educational opportunity. The view that the politics and legal requirements of Keyes case had become a managerial impediment had also become popular. The concern was that, "As long as Denver schools remained under the watchful eye of the federal court, board members and administrators may hesitate to try new 187

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programs or implement much needed reforms for fear of invoking the wrath of the judiciary." (The Denver Post, January 23, 1992). Denver is not isolated in the elusive quest of turning desegregation policies into practice. Willie et. al (1991: 36), report that desegregation research planning, innovation, and field testing did not move forward rapidly. "It took roughly fifteen to twenty years after the Brown decision to master the challenge of how to plan and implement school desegregation methods. State agencies were with few exceptions were committed to avoiding these policy issues. Universities and colleges had few knowledgeable experts to contribute. Generally, technical needs in desegregation were great, while the availability of technical help was not." In the first twenty years after Brown, plans were usually devoid of educational components. Later a more diverse range of options began to be devised and installed. The best plans went beyond these, however, to include features for administrative decentralization, citizen participation, independent monitoring, evaluation, and even capitalization reforms for funding districts and upgrading their facilities and equipment (Chesler 1981; England 1982; England and Morgan 1986; Willie et. al. 1991; Fife 1992; Gordon 1994 ). As the Denver case evolved from the initial litigation in the sixties, to the implementation of district-wide desegregation in 1975, the diversity of ideas regarding what goes into an effective desegregation plan were confounding. There was little consensus in the Denver schools or in the community as to which approaches were the best fit for Denver. Prior to the 188

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judge's forced implementation of the court mandated and fashioned Finger plan in the 1970s, the board and district officials had reviewed over fourteen divergent versions or visions as to what desegregation in Denver should look like. The inability to find this common ground throughout the twenty-five years of desegregation litigation, made the implementation of any one plan problematic. The district was often criticized for the constant change and uncertainty that came with frequent experimentation. Denver did as other districts by fashioning strategies which included multiple components. In Denver, a combination of mandatory busing, pairing and clustering of schools, magnet schools, voluntary transfers, in-service training and school upgrades shaped the vision of desegregation. Each of these components became a part of Denver's efforts, and each strategy met with varying degrees of success (Reports on Resolution 2233, 1989; Matsch's Memorandum and Order, 1995). The official policies and charges to management regarding desegregation are reflected in the board's resolutions throughout the duration of the Denver case. (See Appendix B). These resolutions are embedded with managerial responsibilities for school leadership and their administrative staffs. The different superintendents and their respective staffs, have approached these managerial challenges differently and with different levels of commitment. Boards have modified and changed these resolutions over time, and they have served as a guide for the managers of 189

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the district regarding district philosophy, policy, and practice relative to equal educational opportunity. The 1987 Interim Decree allowed the district even more flexibility, as the judge began to change his view of the willingness and ability of the district to comply with court guidelines. However, despite these good faith efforts, Gordon Griener, lawyer for the plaintiffs, argued that, "The various boards and their staffs had done a poor job setting specific goals, designating individuals to make improvements, or even defining for themselves the scope of the problems." (The Denver Post, August 25, 1994 ). However, over time, the court case became more convoluted and complex that it affected nearly every aspect of management in the district. The expanding scope of the case, made desegregation extremely elusive in a climate of apprehension and uncertainty. The management of desegregation in Denver, as reflected in this history, can be likened to trying to hit a moving target. The recalcitrance of early boards and staffs set in motion a bureaucratic inertia, which gave way in later years to "good faith" efforts to comply coupled with continuous appeals to the court seeking release from court supervision. Despite efforts on the part of the district to comply, all was not done that could have been to achieve equal educational opportunity. Those responsible for implementing the court order moved with one foot in, and one foot out of the desegregation waters, throughout the history of the case. Denver Public School officials literally walked a tightrope over the duration of the case. This ambivalence 190

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was in part a reason for the courts questioning the degree of compliance and maintaining supervision for nearly twenty-five years. Notwithstanding the help and attention devoted to the planning and management of desegregation, school districts have not been able to bridge the gap between pronouncements about equal educational opportunity and actual practice. Urban districts have not been successful in providing desegregated education against the tide of shifting legal doctrine and political attitudes, demographic shifts, funding inequities between urban and suburban districts, and increasing socio-economic disparities in student populations (Orfield et al. 1993; Douglas 1995; Johnson, 1995). "In some school districts, plans that appeared on paper, simply did not work on implementation. Whether through a faulty plan, the lack of community and school leadership, or lack of vigilance, the result has been the same-large numbers of minority and poor students have experienced neither desegregation or equal educational opportunity (Network of Regional Desegregation Assistance Centers 1989: 17 -18). The interest and commitment to school desegregation also waned in the 1980s and 1990s. The mindset of the public at large, and that of state and local governments, has shifted to issues of excellence versus equity, even though these goals are not mutually exclusive (Apple 1989: 59). The impulse and funding to understand the phenomena of equal educational opportunity through scholarly investigation has similarly diminished, along with the usefulness of social science research in the management of these 191

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complex and interrelated issues (Hochschild 1985; Hansen 1993; Gordon 1994). Understanding the barriers and constraints of the managerial dimensions of public school desegregation, is critical to gaining a more comprehensive and policy relevant perspective on the history of the Keyes case and its impact. In the examination of the historical obstacles school administrators have faced in planning and implementing effective desegregation, we find persistent issues which have yet to be addressed fully. Fishman and Strauss (1989: 665), in their analysis of Keyes as an "endless journey", identified several obstacles to the management of effective desegregation in the Denver schools. They point to bureaucratic concerns and management dilemmas related to issues like: racial imbalance in student suspensions, minority and Anglo disparities in achievement, faculty integration, resegregation, bi-lingual education, demographic shifts, and housing segregation. Many of these issues cannot be resolved by school officials in isolation, but they must be addressed in the post-desegregation era. Efforts to partner with the city, other governmental agencies, and the private sector, provide new challenges for management, and hope for equity and quality in Denver's mostly segregated neighborhood schools. The 1989-90 decentralization of management functions, and establishment of local governing councils (CDMs) at each school site, will make ensuring quality and equity just as problematic as it has been during 192

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the desegregation era. In his final decree, Judge Matsch admits his concern regarding diversity and representation on these local school governing bodies. He observed that, "The creation and operation of these site-based management groups may present problems for the Board. Such decentralization of authority could adversely impact the unitary character of the District in the future" (Memorandum and Opinion, September 12, 1995: 64 ). Monitoring and accountability for equity and quality in this new environment, will present the Board and school administrators with significant challenges, if the goal of equal educational opportunity is to be realized for all of the children in Denver. Focusing the Political Lens on Keves The political tenor of integration changed. Neighborhood schools are what are politically possible ... The end of busing is strictly a matter of politics not education. (Gordon Griener, lawyer for the plaintiffs, quoted in Westward, January 1997: 18) By the time Keyes was heard in the Supreme Court: It was clear that the federal government was giving up on its mission of bringing the nation's public schools; into compliance with constitutional requirements for desegregation. The White House openly warned federal officials that they would be fired if they continued to urge busing. The Justice Department, once an ally of integration, gave low priority to school cases and sometimes led the opposition to legal theories advanced by civil rights lawyers. In both the Charlotte (Swann) and the Denver cases, the Department sided 193

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emphatically with proponents of less integration. (Wilkinson 1979: 217). In the assessment of the impact of Keyes, politics has been another under-emphasized, yet potent theme. By the time the Keyes case came to the Supreme Court docket in 197 4, the political tide had begun to shift and the opponents of busing were being listened to across the country. As the descriptive history of Keyes illustrates, the politics of desegregation in this city have had a significant influence on the effectiveness of desegregation efforts. In the Denver case, there have been political dynamics involving official policy makers at the federal, state, and local levels, A variety of political stakeholders have attempted to sway the direction of desegregation in Denver. Governors, state legislators, mayors, and local city council persons, have influenced both the emergence and dismantling of desegregation. From the beginning of this lengthy litigation, political coalitions were formed on both sides of the issue. School board campaigns were won or lost on one's position on the busing platform. At the state level, the anti busing forces in Colorado fearing that busing would cross city boundaries, passed the Anti-Busing Amendment to the Colorado Constitution (1974), and the Poundstone Amendment. These state level politics effectively isolated the idea of desegregation to the city limits of Denver and prohibited the city from annexing neighboring property. The Denver case also became a target of federal anti-busing forces through the intervention of the 194

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Department of Justice in support of the release of the district from court supervision. In the eighties and nineties, mayoral campaigns of the 1980s and 1990s (Pena and Webb) have taken on the challenge of "getting Denver off the bus". Busing has been utilized as the political scapegoat for all that is wrong with the city, despite the fact that persons leave inner cities for a variety of concerns, (economic opportunities, crimes rates, affordable housing, etc.) In the litigative proceedings which led to the release of Denver from its courtordered busing, Mayor Webb, through the city attorney, filed with the court to become intervenors in the case. In the final hearings to release Denver from its court-ordered desegregation plan, the state attorney general, Gale Norton, also filed to intervene in the case to support the district's contention that it had fulfilled the requirements for compliance. These political interventions received support from the press and public and were shunned by both the school district and plaintiffs (Rocky Mountain News, April 18, 1994). The politics of desegregation in Denver has been most visible in Board politics. Fishman and Strauss (1989:661) observe that, "In the course of the litigation, the Denver school boards became an extremely political governing body, a plateau from which its members could launch a political career. This trend has had an adverse effect on the development of desegregation remedies. Until Keyes, those who served on the board were 195

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members of the Denver establishment, board membership was not a highly visible position politically. n The 1969 school board election was a watershed. From then on, elections became ideological battle grounds centered on busing. Increasing, sophisticated political tactics were used for a position that paid nothing. A brief look at the board elections from 1975, the year after the original remedy was implemented, until the election in May 1985, reveals the tenacious grip the busing issue has had on the Board's politics, and how much the board evolved as a political animal-most notably when it came to getting elected and more importantly, to staking out a political constituency." (Fishman and Strauss 1989: 661 ). The politicization of the school board has meant that certain board candidates have run for office with the understanding that they would oppose the court-order-or not support it publicly. Into the 1990s, school board candidates with minor distinctions all wanted to end federal court supervision (Rocky Mountain News, May 5, 1993). "There is much political mileage to be gained by opposing busing, and over the years there has been a stable constituency in Denver that supports that stance. As a result, the board, in varying degrees has been recalcitrant, and some cases openly defiant toward court-ordered desegregation "(Fishman and Strauss 1989:662). The successful implementation of the variety of plans which were developed throughout the history of the case were subject to the political leanings, knowledge, and commitment of the boards of education. 196

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In addition to the intergovernmental and board politics, the community politics of race and class have also had a significant impact on the outcomes of Denver's desegregation. The racial and cultural politics of the Denver case make it unique in the history of desegregation litigation. From the beginning of the case, African-American and Hispanic litigants have presented various and often competing demands to a school system controlled by Anglos, in both policy making and administrative dimensions. The effort by the judge (Matsch) to allow the parties to negotiate an agreement to settle the case, often diminished into a political battlefield on which nothing was settled. The majority Anglo faculties of the Denver schools, have been challenged by these communities in regarding their commitment, and capacity to meet the needs of the current majority of the school population, which is predominately Hispanic and African-American. In addition to these more apparent forms of politics, the desegregation movements have to a large extent been influenced by the internal politics of the bureaucracies of large school districts, and Denver is no exception. Some have observed that bureaucratic politics between the administration and local schools, created its own inertia to the effective implementation of desegregation plans (Fishman and Strauss 1989; Kirp, 1992). Blaming the court order for white flight and the decline of schools, became an easy scapegoat for those who sought to blame the system rather than take responsibility on themselves. Some insist that at various stages of the Denver case, the board's reluctance to approach the desegregation 197

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remedies in a positive light, filtered down into the bureaucracy (Fishman and Strauss 1989). Faculty resistance to in-service training, (a key component of successful desegregation plans), the shunning of outside uexpere assistance are viewed as examples of this resistance. The resegregation of desegregated schools, has also been viewed as an example of a lack of internal organizational commitment to the various desegregation plans and their successful implementation. The influence of the media in the politics of Denver's desegregation experience is another aspect of the politics of desegregation which cannot be ignored. The mostly hostile Denver media, consistently put its spin on issues related to the desegregation of the schools. Gary Orfield (1978) has observed the selective and limited amount of information that got through to the public regarding the various views about the effort to desegregate public schools. After the review of the multitude of articles related to desegregation from Denver's two major dailies, The Denver Post and Rocky Mountain News, the researcher has made several observations. The reporting of education news in Denver depends to a significant degree on the editor and individual reporters assigned to this section of the city desk. The overall coverage of the Keyes case by the Denver Press has ebbed and flowed with the intensity of the political climate. For example, there were peaks in coverage and editorial comment during times of the most controversy. The press was most active during the beginning of the desegregation controversy and during its dismantling (1960s-70s and the 1990s). The anti-198

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busing politics of the press is most clearly apparent in the editorial pages of both Denver dailies, which were often scathing in their criticism of the board, and the effort to desegregate the schools. The cost of legal fees also fanned the political fires which led to the dismantling of desegregation in Denver emerged in the 1990s. The district's and plaintiffs lawyers were accused of taking advantage of the tangle of legal issues involved in the history of the Keyes litigation. There were questions as to who was really benefiting from the continued litigation. The press exposed the high price of litigation at a time when the school district was struggling with budget cuts, poor student achievement, and frustration of parents and community members ( Rocky Mountain News, May 13, 1993 ). The changing attitudes of minorities in Denver also added to the shift in the political environment of desegregation (Rocky Mountain News, Aug. 19, 1994). Over the duration of the case the African-American community and its students felt that they bore the largest share of the burden of desegregation. In busing these students out of their neighborhoods to integrate majority white schools, many feel that achievement, parental involvement, and the sense of community suffered. Frustrated with the inability of desegregation to produce significant gains for their students, the AfricanAmerican community questioned its support of this lengthy litigation. And interestingly, the lawyers for the families who sued the district, filed a motion indicating that Denver Public Schools had made substantial progress 199

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and that they didn't oppose the move to end the case despite the continuing disparities (Rocky Mountain News, Aug. 21, 1994). The politicization of desegregation and busing in Denver most certainly limited the degree of success achieved. in the attempts to provide equal educational opportunity through these remedies. The historically anti busing majority on the boards of education, a hostile press, and an unsupportive community that voted with their feet, most certainly influenced the direction that desegregation would take in this city. The variety of political actors, who utilized the unpopular notion of desegregation for own political capital, also undermined the vision of those who supported the case. Focusing the Legal Lens on Keyes Recent Supreme Court decisions have trimmed constitutional requirements for a society that has left behind formal segregation, but not the realities of racism and discrimination. As ultimately designed, the law of the land is that the achievements of Brown need not be preserved and the undoing of segregation itself is required only to the extent practicable ( Lively 1993:649). The legal path of Denver's desegregation experience has been long, complicated, and protracted. The legal lens of this history reveals the tendency, on behalf of the district and the plaintiffs, to rely on the courts to referee these issues. In the course of the twenty-five years of litigation, we find in the court documents not just one legal battle, but Keyes I through Keyes XVIII stretched out over this history. The courts were both 200

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condemned and thanked for the strong supervisory role taken throughout most of the duration of the case. However, as legal precedents in desegregation cases shifted across the country, the legal requirement for remedial relief in the Keyes case was relaxed over time. The Court and its federal branches moved from eliminating the vestiges of past discriminatory practices "root and branch", to eliminating vestiges to "the extent practicable." The legal path of desegregation in Denver has followed that of the nation in respect to the retrenchment of these policies in the 1980s and 1990s. In the Memorandum and Opinion (September 12, 1995), releasing the Denver Public Schools from court-order desegregation, Judge Matsch makes reference to the precedents which have weakened these policies. The press has also been critical of the judge's handling of the case. Rocky Mountain News editor Vincent Carroll writes that, "Matschone of President Nixon's notable contributions to judicial hubris-has spent nearly 20 years conjuring a moving target for the school board, imposing one standard for English-deficient students, another for the recruitment of personnel, and even once supported a Compliance Assistance Panel whose clownish proposals included faculty relaxation programs" (Rocky Mountain News, Aug. 21, 1994). Kevin Brown (1992b:898) observes that, "Not only has America failed to integrate its public schools, but the Supreme Court, in two of its most recent desegregation rulings, Board of Education v. Dowell and Freeman v. Pitts, has set the judicial stage for the termination of school desegregation decrees. There are currently over 500 school districts under some form of 201

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. I I I I supervision. Termination of these decrees will return faculty and student assignment decisions back to the control of local and state education officials, and the reaction to this is mixed." Some say we have forgotten that in the history of Brown and its progeny, it was the resistance to fairness in education at state and local levels, which led to the intervention of the Court. In the post-desegregation landscape: Education officials will be able to adopt, or readopt, race neutral student placement methods, such as neighborhood school assignments, and possibly freedom of choice plans. Because student assignments will no longer be motivated by an attempt to maintain a desegregated student body, the result of the termination of a large number of existing desegregation orders during the 1990s, will be an increase in the amount of racial separation in public schools. With this in mind, it is probably safe to conclude that public schools have already achieved the maximum, amount of desegregation that will be achieved in the near future (/d., at 899). The legal frameworks of Freeman, Dowell, and now Keyes (1995), make it too easy for district courts to dissolve desegregation decrees, thus enabling the reemergence of racially identifiable stigmatizing schools that the decrees were designed to eradicate. While not advocating a mandated separation of the races, proposals to eliminate or scale back decades-old desegregation remedies will return many districts to a system of segregated and mostly unequal neighborhood schools. Once a decree is lifted, parents and children will have a tougher time attacking a school board's actions, even if they result in resegregation. Plaintiffs must now prove discriminatory 202

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intent and overcome a variety of other discouraging obstacles (F. Brown 1994:337). In a dissenting opinion, the late Justice Marshall observed that, "The majority of the Court signals that it regards racial discrimination as largely a phenomena of the past, and that government bodies need no longer preoccupy themselves with rectifying racial injustice." (J. Marshall dissenting in Cronson v .Clark, 48 U.S. 871 (1989). With a variety of shifts in attitude and tactics, the legal framework of desegregation law has unraveling to the point where it has been characterized as "contradictory, surrealistic, and incoherent" (Yoduf 1978:57). Some insist that the remedy for de jure segregation (i.e. desegregation through racial balance or busing}, has effectively duplicated and worsened the disease it was designed to cure (K. Brown 1992). The harshest critics of our over-reliance on the wavering desegregation doctrine, insist that the Court has helped to seal off inner cities, reinforced the "badge of inferiority" by insisting that black schools are inferior, and obfuscated our understanding of race and rights (Hansen 1993; Spann 1993). Today the retrenchment in race and rights is also reflected in the controversies regarding the constitutionality of Black male academies, minority scholarships, and affirmative action that takes the form of reserving slots in state funded professional schools (Lively 1992; Spann 1993). The recent court cases, along with Keyes, appear to complete a counter-revolution. Bell and other critical legal and race theorists, observe that the impact of white resistance, a less than supportive Supreme Court, and demographic shifts have proved to be a lot more potent than the 203

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progressiveness of the 1960s civil rights era for which Brown served as catalyst( Bell 1989; Spann 1993, Haymen, Jr. 1995). Taking their cues from the conservative restoration, public sentiment and the federal courts seem to have returned us full circle to a pre-Brown posture that says-segregation is O.K. under certain conditions or traditions, e .g de facto segregation. Plessy v. Ferguson's "traditions of the people" -the tradition of separateness, racial hierarchy, and racial tensions appear to be ours once again in this new landscape It is painfully ironic that the centennial of the Plessy ruling comes at a time when the courts and many school districts have moved to end the efforts to provide integrated schooling. Faced with the disillusionment in the ability of busing to guarantee quality education for all, urban districts appear convinced that the 1990s version of neighborhood schools can truly be "separate but equal", and preferable to "integrated but and unequal". However, the conclusion that there is a clear and certain path to providing quality education to racially isolated neighborhood schools is premature given the current state of educational inequity in urban school districts. The experiences of districts that have decided to dismantle their desegregation plans illustrate a variety of troublesome problems that suggest the need to re-examine basic assumptions regarding race, the law, and the right to equal educational opportunity They also reinforce the significance of the interrelationships between the managerial, political and legal aspects of this struggle. Orfield and Thronson (1993 : 761) in their examination of the "uncertain gains and 204

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unexpected costs" of dismantling desegregation efforts, warn that school districts are moving forward in this murky landscape with unsupported expectations. The idea, for example, that political conflict will diminish and that non-judicial mechanisms can assure equity in the resegregated minority schools are not supported empirically in several districts. Local commitments to special programs for resegregated schools last only a limited time. Furthermore, the assumption that we know how to provide equal education in segregate schools has not proved true in spite of considerable efforts. Costs are not likely to decline. In some districts, racial tensions and legal disagreements across racial lines have continued at a high level. The hoped for end of white flight and the return of white students have not materialized at all in some districts, and have been far below predictions in others (/d. ,at 761 ). They go on to insist that: The fundamental reason for the difficult and uncertain results of the dismantling efforts, is that the legal standards for a court finding that a school district has purged its constitutional violation and become unitary, have very little to do with whether the district has actually provided equal education to minority youth for a long enough time to overcome the cumulative impact of generations of unequal opportunity. In fact, the standards require no showing that gaps in educational opportunity have actually narrowed. (ld. at 762). The question facing the court in the last days of this case, was whether all children receive equal education in the Denver Public Schools. 205

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After days of debates and statistical presentations about student achievement, the answer was painfully clear: No. (Rocky Mountain News, Aug., 28, 1994). Disparities were recognized by the judge, however, the district was not to be blamed for the continuing discrimination or the resegregation of its schools with the lifting of the court-order. The gaps in educational opportunity were considered beyond the scope of the case. Moreover, recent court precedents had narrowed the scope of desegregation remedies and the jurisdiction of the federal courts in educational policy (Dowe/11991, Freeman v. Pitts 1992, Missouri v. Jenkins 1995). In these cases, the Court also conceded to the de facto segregation cased by housing patterns. Increasingly, segregated neighborhoods are being reflected in the nation's classrooms. For many school districts, including Denver, the only hope for eradicating segregation in schools is chipping away at housing segregation. In releasing Denver from court-jurisdiction Judge Matsch refers to a string of laws and statutes at the state and federal levels which would provide a framework for pursuing the goals of equal educational opportunity. (See Appendix C). This new legal framework should be examined closely by the board, administrators, and community, for it will most likely become the context for future legal and political battles. Elaine Jones (1996), Director-Counsel for the NAACP Legal Defense Fund, helps to put the legal aspects of the struggle for desegregation in a striking perspective. She states that, 206

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As a nation we have come to a point where we now honor Brown, in theory more than we do in fact. The consequences are not solely of legal significance. Millions of American children are relegated to racially segregated schools with high concentrations of economically disadvantaged students. They gain little solace from the knowledge that at one point in time a federal court was able to take a judicial snapshot of a desegregated district before it was allowed to resegregate or that the segregation they experience has been judicially determined to be de facto (Orfield and Eaton: 1996:ix). This statement reflects the general frustration and realization of the historical limitations of the legal approach to desegregation Looking through the legal lens of desegregation, it does appear as if we have returned to the point where we started The history of Keyes, clearly illustrates, how a legal mandate cannot assure equal educational opportunity, in isolation from political will or managerial competence and commitment. The view of Keyes v School District No. 1 through the conceptual lenses of public administration, provides a broader understanding of the impact of the this case on Denver and its schools. The history of Keyes as reflected in these historical lenses, demonstrates how managerial, political, and legal approaches to these policies, have shaped the direction and overall impact of desegregation in this city. The convergence of these influences throughout the history of the case, reveals multiple constraints and barriers to desegregation efforts. The politicization of busing, legal retrenchment, and managerial ambivalence, provided an inertia to desegregation that supporters could not overcome. The hindsight of this 207

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history, also helps to identify themes and issues important to the unfinished agenda of providing equal educational opportunity to all students. Policy Implications: Understanding the Past, Exploring the Future Until the public mind is disabused of the notion that the "problem" of "segregated" schools has been eliminated, America will continue to be two societies: black and white, separate and unequal. One of the reasons for the resistance to various remedial measures is the difficulty the public has in understanding the nexus between the present segregation condition and that which existed in the past (Judge Nathan Jones 1994:525) Understanding the nexus between the present conditions in the nation's urban schools and the conditions of the past is critical for shaping future policy and practice. Forty-plus years after Brown, and twenty-five years after Keyes, is more a time for reflection and introspection than celebration. Issues related to race and social justice in a number of arenas continue to perplex us. The history of desegregation is a striking example of this continuing American dilemma. The most frustrating aspect of our forty year experience with desegregation is, as Gary Orfield (1986:93) has observed, that "There is no political or intellectual consensus about where we have been, what we have learned, or where we are going from here. n There is, however, general agreement on at least two points with regard to the history of public school desegregation-the racially integrated school systems we sought have not been produced to the extent hoped, and the 208

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I I I I I equal educational opportunities envisioned by the architects of the Brown strategy have not been realized. The dismantling of Keyes. has left the Denver community with many unanswered questions, unresolved issues, and an unfinished agenda relative to equal educational opportunity. If the desegregation era over, we must ask: How do we provide equal educational opportunity to African American students and other students of color. If racial balance is not the remedy for persistent educational inequities, then what is the formula for achieving this forgotten goal of Brown? Can we truly provide an education for these students that is separate yet equal? If resistance in the managerial, political, and legal realms make desegregation impractical, why not try to insure that separate does not mean unequal? What ever the future holds, we should be determined not to repeat the errors of the disappointing past. The ignored lessons of the four decades following Brown and the legacy of Keyes, are being learned at great cost to our children. They should not be ignored as policy makers and legalists chart the future course for race and equal educational opportunity. We should have learned that merely integrating schools, in a society still entrenched in racism, does not ensure black parents and their children equal opportunity. We should have learned that just moving children to different schools, is an important but not sufficient strategy, if the education they receive at the end of the bus ride will not prepare then for a competitive 209

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I I I I I I I I I I I I I i i i I I i world, to be good citizens, or to have appreciation for people unlike themselves. This country and its schools are going through vast changes without strategies to impact the growing disparities. The children left behind in urban schools need a quality, equitable, and diverse education tailored to their needs in all of the varied educational settings in which we find them. The next set of struggles is to have schools that are truly equal. Our immediate concern must to require schools regardless of their ethnic make up to produce quality education for all who attend them. Educators, parents, and community must take the lead in the continuing struggle to make the promise of equal educational opportunity a reality. There are some who insist that there is a need to revise the goals of the Brown and Keyes, and move beyond desegregation. In the attempt to learn from the past, and avoid a return "full circle" to separate and unequal schooling, there is a need to refocus our efforts in four critical areas. Based on this research, the literature, and the experience of the writer with the plight of urban school districts, there are several emergent themes which may provide guidance for future policy. In depth analysis of these concerns for post-Keyes Denver is beyond the scope of this dissertation, however, they and will continue to provide fertile ground for further research and action. The following recommendations represent the minimum requirements for strategies to assist schools in Denver, and other urban centers, from making the journey full circle" return to separate and unequal 210

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schooling. There is a need to move beyond desegregation to more expansive models of equity and quality education. These two goals are not mutually exclusive, and many feel that you cannot have one without the other. The equitable distribution of resources, staff development, curriculum and instruction, and parental/community involvement are the cornerstones of a framework for equity in the post-desegregation landscape. In assessing the impact of the history of Keyes, these are only some of the challenges which remain in the unfinished agenda of this case. These critical themes have implications for future policy, research, and practice. The challenges in each of these areas, also have implications for managerial, political, and legal approaches to creating equity and quality education in today's changing environment. Recommendations for Educational Equity in Post-Keyes Denver 1. Equitable Distribution of Resources The equitable distribution of resources is a key factor for the realization of equity and quality schools in the post-desegregation landscape. Across the nation suburban school districts are often funded at twice the levels as urban school districts. In moving beyond desegregation, the issue of resource distribution, has moved to the center of the policy 211

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agenda for many seeking to ensure that minority children are not left out of the future. In addition, the dwindling tax bases of urban centers and the crumbling infrastructure of decaying schools, leave many urban districts at a serious disadvantage. Equitable in today's setting, does not mean equal resources. Schools in urban districts require additional resources to counter the effects of racial isolation and socio-economic disadvantage. The debate regarding the equitable distribution of resources will be a source of future legal and political battles. Already, in several states, urban centers have sued in order to obtain the funding necessary to provide quality and equitable education to their students. An example of the movement toward equity litigation in education can be found in the New Jersey case Abbott v. Burke, 136 N.J. 444 ( 1994) where the majorityminority school districts have successfully challenged state officials on the issue of equal funding. The politics of school vouchers, charter schools, and the like, threaten to further deplete the resources provided to urban districts. These proposals will have to be closely scrutinized for the degree of equity and opportunity provided they promise to all children. The equitable distribution of resources, human and material, will present a significant challenge for policy makers. In urban districts the socio-economic disparity between neighborhoods will require a method of managing resources in a way that they are distributed according to need. School in a mostly Anglo and middle class neighborhoods often have clear advantages when it comes to gifts, contributions and the capacity of these 212

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neighborhoods to support their schools. Conversely, schools in socio economically challenged neighborhoods may not have the same access to community resources. Without a fairer distribution of resources and quality between urban and suburban school districts, all proposals for providing equity and quality in education become merely and interesting topics for discussion. Money does make a significant difference, in both quality, and the degree of equity school districts can provide. The dismantling experiences of Dekalb County (Atlanta), Oklahoma City, and Kansas City, already suggest that it is unfortunately still true that segregation leads, perhaps inexorably, to inequality of educational resources and quality (Orfield and Eaton 1996). 2. Staff Development and Training Staffing disparities between black and minority schools was one of the central issues of the Denver case. The practice assigning of black teachers and inexperienced to majority black schools was an issue which initiated the court case. The politics of unions will be a challenge to the development of a quality and caring teaching force in Denver schools. The self-interest of unions often creates barriers to reform and change in schools districts. The rights of teachers have to be balanced with the rights of students and parents, if equity is to be of goal of Denver's post desegregation schools. In the effort to insure that each school has a qualified and committed staff, the Collaborative Decision Committees (CDMs) at each school site, can make decisions regarding personnel and 213

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school the design of schools. However, even with the opportunity this presents, there is potential for this decentralization to become another source of political and legal tensions in the development of future policy and practice. The creation of qualified and diverse staffs can provide schools with a fair chance to succeed. The recruitment and retention of African-American and Hispanic teachers is a challenge for all schools districts. The shortage of minority teachers will challenge the administrators of the district to develop strategies which can enhance the competitiveness of the district in salaries and benefits compared to the nation and surrounding district. Redefining the role of institutions of higher education provides another challenge in the development of policies and practices to support the needs of urban school districts in the areas of programs, research, and training. For example, teacher training programs which focus on preparing teachers to maximize their efforts in this age of information and technology are vital element for achieving both equity and quality in urban districts. Strengthening the educational pipeline, from kindergarten to post-graduate education, is vital to a productive workforce and future economy. The ability of the Denver public schools to forge functional partnerships with higher education institutions can provide resources and expertise vital to the future of equity and quality. 214

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3. Curriculum and Instruction Developing high standards and high expectations for all students is yet another focus which can assist urban districts in completing the unfinished agenda of desegregation efforts. Diversity in the curriculum, quality, and equal access to special programs, are all required. All students should be exposed to a curriculum which will provide them with an advantage in the context of the global village. Multicultural education scholars insist that it is important that the history and contributions of all Americans to be accurately written and integrated throughout the curriculum. "More of the curriculum should be organized around social issues that include race, class, gender, and disability as perspective for analysis. Students life histories and ethnic communities will often served as the starting point to teach critical thinking about issues critical to their life circumstances." (Tate et. al. 1996: 46). Attention to curriculum and instruction must also address the multiple learning styles of children, and issues of language and culture. Instructional methodologies which work for some students, may not work well for others. Sharing and duplication of techniques which meet the needs of different students, should be central to the professional development and support any school district provides to its staff. There is both legal and political pressure to address the issues of quality and diversity in curriculum and instruction. The pressure for higher standards and accountability is being felt from both the state and federal 215

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levels of government. Educational reform efforts are claiming to provide both educational excellence and equity for all students. The of minimum standards adopted by legislatures throughout the country, also hold some promise for an increased accountability for higher standards and greater opportunity for all children (Liebman 1993). Denver and other Colorado districts, have received pressure from the state for the improvement of curriculum and instruction with a focus on standards, monitoring, and accountability. 4. Parent and Community Involvement Keyes, like many desegregation cases before and after it, was heard by the judicial system because African-American parents and community members were fed up with the quality of education their children were receiving in the Denver public schools. In the challenging landscape of today's schools, parents and community are charged with becoming even more active and knowledgeable about educational processes. Research has demonstrated that the more involved the parents, the more responsive the schools, and the more students benefit. The site-based governance and decision making adopted by the Denver schools between 1988 and 1990, offers the opportunity for parents and community to impact schools and hold them accountable. The challenge for the school district, is to aggressively and continuously develop mechanisms to foster positive parent-community school relations. This need must be fundamental to the philosophy and 216

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practice of providing equity and quality education. When schools acknowledge the range in disposition, backgrounds, experiences, and strengths of diverse families, efforts to establish home-school communications and involvement are more successful. In the post-desegregation landscape, there is also greater onus on parents to take more responsibility for participating in and monitoring their child's education. With the decentralization of decision making and power in the Denver school district there are opportunities for constructive parental and community involvement. However, positive change cannot occur without a more active and informed involvement of parents and community. The end of busing in Denver, presents critical challenges to parents, churches, and community organization to become more informed and involved in their local schools. The leadership in Denver's communities of color, must renew their interest and commitment to educational issues. History has demonstrated that the schools cannot achieve the goals of equity and quality in isolation from community interest and involvement. The relative autonomy for schools in the Denver district presents challenges and opportunities for the provision of quality and equity in Denver's schools. There is opportunity for creativity, innovation, and a greater ability to response to the desires and needs of school populations. There are also challenges related to representativeness, equity, and responsiveness. The Denver school district has committed itself to policies which address many aspects of the above recommendations in Resolution 217

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No. 2529. This resolve, currently guides policies related to equal educational opportunity in the post Keyes-environment. The current leadership in the distrid has indicated its commitment to these goals. However, there is still significant uncertainty as to how these goals can be most successfully achieved. Participation and greater accountability on the part of parents and community, can help to ensure that equity and quality do not become empty promises in Denver, as they have in other districts which have dismantled their desegregation efforts .. ****************************** The writer ends the saga of desegregation in Denver where she began with the concern for how the traditions of racism and separatism continue to impact the provision of equal opportunity our public schools. The convergence of the managerial, political, and legal lenses of public administration on this history, have provide the reader with a broader more enlightened view of Denver's desegregation experience. The perspective on this history, as developed in this case study, helps to connect the past with the future of education in Denver. Race continues to be America's greatest dilemma and education still remains the best escape from segregation's effects. Revisioning the goals that Brown and Keyes represent, through the type of policies and practices recommendations discuss above, offers some hope in the post desegregation landscape. However, the persistence of separate and unequal education must challenge us all to take stock of the consequences 218

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of these trends to the future of the nation. There is a real danger in moving forward in the post-desegregation landscape without critical examination of the trade-offs for society and individuals as we evaluate our separateness. Several high profile media events, including President's Clinton's national dialogue on race, may help us come to grips with the realization that we are moving closer to Hacker's (1992) "Two Nations: Black and White, Separate, Hostile, and Unequal." Judge Harvie Wilkinson Ill (1995:993) warns of the danger of ethnic separatism in a multicultural society. It must be remembered that the odious part of the Plessy v. Ferguson formulation, was always the word "separate". Although signs were not necessary in the mid-century to designate separate white and black schools, they were used to mark restrooms and water fountains. The indignities of that regime would seem too searing a historical experience ever to be forgotten. Of course, no one today advocates the return of the legally enforced apartheid, yet the lines of racial separation are emerging in a subtler form. Now, at the century's end, we are in danger of squandering the legacies of Abraham Lincoln, who gave us union, and of Thurgood Marshall and Earl Warren, who gave us Brown. It is disquieting that the legacy of Brown, Keyes, and other desegregation efforts should be in doubt just as America is emerging as a multicultural nation. Whether we will be a nation of interracial union or a nation of separate racial enclaves is now unclear. What is certain is that as the nation moves into the new millennium, the diversity of the population will increase. And the consequences of not finding effective ways to educate all 219

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of our children, regardless of race and class, will be reflected in the capacity this diverse nation to compete effectively at a global level, and in the level of social cohesion passed on to future generations. Dr. King's vision of a colorblind society has yet to be fulfilled, and the unfinished agenda of the efforts to desegregate the nation's public schools finds us only half way up the mountain of equality and social justice. Justice Marshall's dissenting opinion in Milliken v. Bradley (197 4) provides a prophetic warning that resounds loudly in today's post desegregation landscape. He writes that, "Our nation, I fear, will be ill served by the Court's refusal to remedy separate and unequal education. For unless our children begin to learn together, there is little hope that our people will ever learn to live together. n The full circle reflected in the history of the Denver case, is a legacy that must be overcome if we are truly to live and work together. Where we go from here is uncertain. History, as this case study illustrates, helps us to see the path we have walked, and the obstacles and barriers along the journey. It is hoped that the managerial, political, and legal perspectives reflected in this history of Keyes, can be helpful in charting a course for the future of equal educational opportunity in Denver. A broader vision and renewed commitment to these goals is critical.. .for the hearts and minds of our children are still at stake. 220

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REFERENCES-CHAPTER VI Alves. Michael and Charles V. Willie. 1987. "Controlled Choice Assignments: A New and More Effective Approach to Desegregation". Urban Review 19: 56 Armor, David. 1995. Forced Justice: School Desegregation and the Law. New York: Oxford University Press. Apple, Michael. 1989. "How Equality Has Been Redefined in the Conservative Restoration". In Walter Secada. ed. Equity in Education. New York: Falmer Press. Bell, Derrick. 1983. "Learning From Our Losses: Is School Desegregation Still Possible in the 1980s?" Phi Delta Kappan 64, No. 572: 89. Brown, Frank. 1994. "Brown and Educational Policy at Forty." Journal of Negro Education 63: 337. Brown, Kevin. 1992b. "After the Desegregation Era: The Legal Dilemma Posed By Race and Education." St.Louis Law Review. 37: 897-921. Brown, Kevin. 1992a. Has the Supreme Court Allowed for De Jure Segregation to Replicate the Disease? Cornell Law Review. 78: 1-83. Chesler, Mark A. 1981. Making Desegregation Worlc A Guide for Educators and Other Professionals. Beverly Hills: Sage. Douglas, Davidson M. 1995. "The Promise of Brown Forty Years Later: Introduction." (Symposium: Brown v. Board of Education After Forty Years: Confronting the Promise). William and Mary Law Review. 36(2): 337-343. England, Robert E. 1992. "Large District School Desegregation: A Preliminary Assessment of Techniques." Social Science Quarterly. 63 (4): 688-700. England, Robert E. and David R. Morgan. 1986. Desegregating Big City Schools: Strategies, Outcomes, and Impacts. New York: Associated Faculty Press. Fife, Brian L. 1992. Desegregation in American Schools: Comparative Intervention Strategies. New York: Praeger Publishers. Fishman, James J. and Lawrence Strauss. 1989. "Endless Journey: Integration and the Provision of Equal Educational Opportunity in Denver's Public Schools: A Study of Keyes v School District No. 1." Howard Law Journal. 32:661,662, 221

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Gordon, William. 1994. "The Implementation of Desegregation Plans Since Brown." Journal of Negro Education. 63(3):310-22. Hacker, Andrew. 1992. Two Nations : Black and White, Separate, Hostile and Unequal. New York: Basic Books. Hansen, Chris 1993 Are the Courts Giving Up? Emory Law Journal. 42(3) : 865-877. Haymen, Robert, Jr. 1995.'The Color of Tradition: Critical Race Theory and Post Modem Constitutional Traditionalism." 30 Harvard C. L.-C.L L R.: 62-78. Hochschild, Jennifer.L. 1985. Thirty Years After Brown. Washington, D.C. Joint Center for Political Studies Jones, Nathaniel. 1994. "The Desegregation of Urban School Thirty Years After Brown". University of Colorado Law Review. Vol.55 : 515. Johnson, Ronald 1995. The Promise of Brown: Has It Been Fulfilled? New York: New York University Press. Kirp, David L. Just Schools: The Idea of Racial Equality in America. Berkeley: University of California Press. Liebman, James 1993 Three Strategies for Implementing Brown Anew". In Race in Ameria : The Struggle for Equality. Herbert Hill and James Jones. eds Madison Wisconsin: University of isconsin Press. Lively, Donald. 1993. "Desegregation and the Supreme Court: The Fatal Attraction of Brown". Hastings Law Review Quarterly. 20 (Spring): 649. Network of Regional Desegregation Assistance Centers. 1989. Desegregation of Public Schools : The Third Generation Washington, D.C.: U S Dept. of Education : 17-18. Ortield, Gary 1978. "Research, Politics, and the Anti-busing Debate." Law and Contemporary Problems. 442(4) Autumn. Ortield, Gary 1986. "Knowledge, Ideology, and School Desegregation: Views From Different Prisms Metropolitan Education. 1 (Spring): 93. 222

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Orfield, Gary et at. 1993. The Growth of Segregation in American Schools: Changing Patterns of Separation and Poverty Since 1968. Alexandria, VA: National School Boards Association). Orfield, Gary and David R. Thronson. 1993. "Dismantling Desegregation: Uncertain Gains, Unexpected Costs.n Emory Law Journal, 42(3):761, 762 .. Orfield, Gary and Susan Eaton. 1996. Dismantling Desegregation: The Quiet Reversal of Brown v. Board of Education. New York: W.W. Norton and Co.: ix, xiv. Rosenbloom, David. 1986. Public Administration: Understanding Management, Politics, and the Law in the Public Sector. New York: Random House:28. Spann, Girardeau. 1993. Race Against the Court: The Supreme Court and Minorities in Comtemporary America. New York: New York University Press. Spring, Joel. 1991. American Education: An Introduction to Social and Political Aspects. White Plains, N.Y.: Longman Publishing Co. Tate, William F., Gloria Ladson-Billings and Carl A. Grant, 1996. "The Brown Decision Revisited: Mathematizing a Social Problem.' In Mwalimu Shujaa. Beyond Desegregation: The Politics of African American Schooling. Thousand Oakes, CA.: Corwin Press: 46. Wilkinson, J. Harvie Ill. 1979. From Brown to Bakke: The Supreme Court and School Integration: 1954-1978. New York: Oxford University Press: 217. Wilkinson, J. Harvie Ill. 1995. The Law of Civil Rights and the Dangers of Separatism in Multicultural American. Stanford Law Review. 42: 993. Willie, Charles, Antoine M. Girabaldi and Womie Reed. 1991. The Education of African Americans. New York: Auburn House: 36, 44. Yudof, Mark. 1978. "School Desegregation: Legal Realism, Reasoned Elaboration and Social Science Research in the Supreme Court." Law and Contemporary Problems. 42: 57 Cases Swann v. Charfotte-Mecklenberg, 401 U.S. 1 (1971). Milliken v. Bradley, 418 U.S. 171 (1974) (J. Marshall dissenting). Cronson v. Clark, 484 U.S. 871 (1989). 223

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Board of Education v. Dowell, 498 U.S. 237 (1991) Freeman v. Pitts, 503 U.S. 467 (1992). Missouri v. Jenkins, 115 S.Ct. 2083 (1995). Abbott v. Burke., 136 N.J.444 (1994). Other Legal Memorandum and Order, 1995 Newspaper Articles The Denver Post, January 23, 1992. Rocky Mountain News, April 2, 1992. Rocky Mountain News, May 5, 1993 Rocky Mountain News, May 19, 1994. Rocky Mountain News, Aug. 18, 1994. Rocky Mountain News, Aug. 19, 1994 Rocky Mountain News, Aug. 21, 1994 Rocky Mountain News, Aug. 25, 1994. Rocky Mountain News, Aug. 28, 1994 Westward, January 1997: 18 Archival Denver Public Schools.( February 15, 1971). Interim Report: As Ordered by the United States District Court. Setting Forth Status of Defendant's Plans and Decisions Regarding Implementation of Final Decree of June 8, 1970. Denver, Colorado: 4 Denver Public Schools. Report on Resolution #2233 for the 1989-90 School Year. Denver, Co. Denver Public Schools, 1989-90. 224

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APPENDICES: A-C 225

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The Oen;er Pes l v/ednesday, Sept. I 3, I 995 APPENDIX A distribution in Denver Public Schools 1 1973 Eicmenlary sr:! tnul 1994 r,sianQ.7% .!unior M::!c!!c ,.,;. : oF 65.4% While Hiyll sr.l:u:::J 226 1 30fo J\; nf'!rir.i1n lntfo
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APPENDIX B Sample Board Resolutions Related to Desegregation and Equal Educational Opportunity 227

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RSOLUTION NUMBER PAR! I Policy 5100, Denver Schools, recognizes that the continuation of neighborhood schools has resulted in the concentration of 1oee minority racial 1nd ethnic groups in some schools and that a reduction of 1uch concentration and the establishment of an integrated school population is desirable to achieve of educational opportunity. Therefore, in order to implement Policy 5100, the Board of Education hereby directs the Superintendent to submit to the Board of Education aa soon as possible, but no later than September 30, 1968, a comprehensive plan for the integration of the Denver School. Such plan then to be considered by the Board, the Staff and the community and, with such refinements as may be required, shall be considered for adoption no later than December 31, 1968. PAR! II l. The Board of Education is faced vi th a serious 1ocial crisil. We believe a majority of citizens of Denver have in the ability of this Board to meet the complex, difficult and controversial issues in volved in thia crisis. However, the Board is aware of vide and deep distrust of its motives and actions by certain racial and ethnic groups, and indi viduah within those groups. It is accused of injustice, of perpetuating, without concern, the educational and 1ocial evil occurring with de facto 1egregation in school. The1e groups have been promised much by society in general. Repeated failures of performance have alienated good friend, have created vide distrust of motives and have created an atmosphere where respon1ible leadership and concerned citizen support are being lo1t to the school and to the community. We are increasingly aware of feelings of antagonism, of isolation, of hopelessness, of deep and unyielding bitterne11, real and intene. These feelings are strongly held and are not 1ubject to easy co.aunication to those who do not have a 1imilar background. The Board nov 1tate1 that it1 policy will be to eliminate distrust of its motive and performance by the minority community. 2. Also, the Board is aware of a different and widespread com.unity di1tru1t of Board motives and actions. This is evidenced by a sub1tantial credibility gap, baaed on the fears of many citizens that their freedom of choice of home location and concurrent school selection is or will be threatened by propo1ed Board action1, particularly actions in the 1olution of the educational problem of de facto minority ethnic and racial 1egreg1tion. The word "bussing", or "reverse bus:sing" (=eanir.g :he trn portation of vhite children into minority populated school), expre the undefined fear of large number of Denver citizens that somehow the Board and it pollcie threaten deeply felt sensibilities. Here there i1 abroad in Denver a degree of distrust that is frightening in it1 intensity and h11 any r .. ifications. Expressions of such feelings are frequently prefaced by expre11 denials of prejudice, racial or otherwise, and the Board accept 1uch denials 1t face value and as evidence of the existence of good will toward the minority communities of Denver. !he Board that the voluntary support of citizen who presently hold such view is neces1ary to the proper functioning of the school system. 228

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3. A third source of distrust of motives and performance ia that body of citizens of all races, including many whites, vho recognize and accept that segregated education is harmful to both mlnorlty and aajority children and vho now ir.sist the Board increase its efforts to ellainate the educational evila of de facto segregation. The Board has obviously failed to convince these people that ita past actions, and particularly the recent approval of major junior high achool construction snd the proposed voluntary movement of elementary minority pupils represent good faith efforts in this area. The confidence of these citizens must be restored and the Board proposes to seek their active support. 4. A fourth force presently apparent and widely communicated to the Board ia 1 throughout the city to aee the tax load priaarily the real estate tax load increased in any degree. In this area, the Board haa apparently failed to communicate to the community the validity of the financial needs of the District. Increased State aid, if and vhen forth coming, vill be welcome but realistically can do little to reduce the real estate tax levy and will, in the long run, create a further class of concerned taxpayers to whom the function, purpose, method and objectives of the school system must be explained and whose understanding of such matters must be ob tained. The Board states that its policy is and will be to foster auch understanding. 5. The death of Dr. Hartin Luther King has focused the attention of concerned people of good vill upon the deep and festering injustices of modern urban existence, with ita contradictions of opportunity and achievement, in an America dedicated, at least in theory, to the equality of opportunity for all men. Particularly in the area of public education, Dr. King'a death hal cau1ed thoughtful peraona of all races, particularly whites, to reaaaeaa beliefs long and dearly held and to question the pace of change and even ita direction. A. The Board is resolved to act as a unifying agency for Deaver in these times. To this end, it requests the Superintendent in implementation of the purposes of Resolution No. 1490 and in responae to the community concerns stated above, to include within the plaa required by Resolution No. 1490, or to submit separately but at the earliest practical tiwe or tiea, a further plan, or a aeries of plana, including specific timetables, to accomplish the following: 1. The reduction of concentrations of minority racial and/or ethnic groups in school and the integration of achool populations. 2. The actual existence of equality of educational program in all achoola, regardless of location, including,vithout limitation, faculty quality, training, experience and attitude, course offerings, equipment and facilities. 3. The active participation in progTama within the metropolitan Denver area to establish more diverse or heterogeneous racial and/or ethnic school populations. 4. The emphasis at all instructional levela of the individual and group contributions of ethnic and racial ainorities.

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RESCLUTION N:J. zz:n WHEREAS, the Board of Education or School District No. 1, Den"'!r, decl;res It to be it! Intention that the Denver Public Schools shall be oper;ated In conformity with the United States Constitution and ;all applicable federal l;aws; and WHEREAS, the Soard of Education desires that Integration be fostered throughout the Denver Public Schools; and WHEREAS, the Board of Education declares that every student enrolled In the Denver Public Schools shall have equal access to all educational opportunities; and Y.HEREAS, the Board of Education Intends th;at the quality or educat!on in the Denver Public: Schools shell be lrnproed continuallv, and that opportunities for enhanced ;and diverse educational shall be av;ilable to all students; end 'MJEREAS, the Board or Education has complied with court providing far the deseqreqratlon of the Denver Public S.:hools, :and h:n petitioned the court for a declaration or unitary status, which deelaratlon would limit or brlnq to a close the c:c:urt's continuing supervision over the Denver Public Schools; and WHEREAS, the Board or Education Intends to ;nsure that the princi;.les ;and that have been by t:,e United States S:::-erne Cour-t shall be permanent policy In this District, so that no Ch:ld .viJI be deprived of :IC:C:e" to educational opportunities beC:lUSe Of barriers erected by discrimination; NOW, BE IT RESO.VED THAT: 1. The Denver Public Schools shalt be oper:\ttd at ;II times in conformity with the United States Constitution ar:d all :JPt:licable laws: 2. This the District, and officers :1nd c:nployees or the District not ;adopt ;any policy or program, Institute any or procedure, or make .,r out any decision for the purpose or dlscdminl\t_lng aqalnst ;nr person by reason or 'lr ethnic l cent! rt cation. !. The goal, objective and poll:y or this Board, the District, and the orncers and employees thereof Is and shall continue to be to provide the m:u:imum educatl.,nal opportunity that can be m;ade available to all students In the school _system. A. The Baud of believing that the beneficial effects or are most rully realized In Integrated schools, shall preserve contiguous zones for schools that are lnteqr;ted and sh111l establish contlquous attendance mnes whenever It appears that 1t:11ble Integration can be maintained In the schools serving ,uch are1s. April 10. 1904 230 \ ..___.

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I I I I I I I I I I i I i I I I I I I I 5. The Boar-d of Educ:;tlon will actively pur-sue to promote inte'}ratlon In the schools by volunt01r-y choice. To that end the Boar-d will develop additional magnet schools and spec:l al pr-ograms. The Boar-d will use all available means to Insure that the maqnet schools :;nd specl:;l are integrated Including, If necessary, enrollment limitations des! gned to Insure an Integrated student body .s. tn addition, the Board or will develo!' and ac!lvely promote 1 voluntary transfer pr-ogram to encourage maj.,:-ity to minority transfers within the District. 7. The meas.ures described In the preceding paragraphs A, 5, and 6 will be used In combination to preserve the unitary character or the S::hooi District. B. Upon termination or Judicial supervtston or the Denver Public Schools, ther-e shall be no sudden alter-ation or the c:ourt-aooroved school assignment plan then In effect. Changes In school attendance pattems which ne determined by the Board of Education to be educationally sound and which promote stable Integrated educational the stated objectives o( this resolution may be :nade. C:ommunlty Input will be sought In the development and implement1tlon or any such ch;anges. The measures referTed to In paragraphs 4, 5, and 6 will be adooted as they wre developed 11nd subject to sarequards to insure that the unitary c:h;;racter o( the District is preserved. 9. The Board or Education dec:l;ares that Its or afflr'matlve action and eqUal opportunity In employment shall continue to guide the selection and assignment or employees within the School District. 10. The Board of Education shall, In cooperation .,Jth the s..,,:;eri.,ci!nd.!nt, c:;,ncinue co m.aincain an emph
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RESOLOTION 23U POLICI fOR PiU:SeR7IW; DE:S!GR!:G'-TIOt: Of" PCBLIC SCSCOLS WHEREAS, the Board believes that the interests of th'J Denver Public Schools vould be ser.,..ed by the tcnnination of th'! 1 itigation arad the return to the School Boi'\r-:1 of full rest=onsibility for carrying out the School District's constltutional obligations without continuing control or supervision, and h"HEREAS, the Board is aware that the Distr:ct Court, in its opinion of June J, 1985, round that the had not pc-ovid'!d sufficiently concrate assurances possiule future resegre qation of the District, and WHEREAS, the Board desires to establish pol and procedures that ,.,ill both (1) clearly manifest the int:ention or the Board that the Denver Public Schools shall continuo!! pet to be operated as a unitary school district 1Jith that 1Jill promote equ'l educational opportunity for all students of race or ethnic background, and (2) provide guidelines for future decision-making-that ,.,ill safeguard against actions by the Board. NOW, 'I'llEREFOP.E, BE IT R!:SOLVED: 1. The Board reaffir-ms its commitment to the principl'!s and stated in Resolution 22JJ, adopted 10, 1984. 2. The Board adopts the following policies to further define and implement Resolution 2233. J. It shall be the policy of the Board to oper
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I I I I i I i I I I I I I I I (c) llo school may be identified as a school intended primad.ly for a particular racial or ethnic group by ::-e.1son of the composition of its teaching staff. {d) School buildings and other facilities a::-e of such quality, that no school may be identified as providing infer:icr or superior !or the education of pupils of any racial or ethnic background. (e) The school system recognizes as one important educational goa 1 t:he provision of an inteqrat::ed ional vherein of different and ethnic backgrounds mAy leat"n togE:ther and .acqu it"e an un.je:-standing and appreciation of their cultural differences and the values of diversity. 4. The policies shall qovet"n future changes in the attendance zones, assignments to schools, or of the student-attendance plan presently in effect: (a) No in such plan shall be made unless there has first. been presented to the BOat'd specific data the effect of such change on the projected racial/ethnic composition of the student enrollment in any school affected by the change. (b) If the projected effect of such a change be to cause a school's mir.ority percentage to move five (5) pet"centage points or more further away from the then-current distrlctwide averAge at that level (elementary, middle, or hiqh school) than it was in the ye4r preceding the proposed chang-e, the change shall not be made unless: (1) The Board determines that such change is consistent or will promote, the overall objective of maintaining or enhancin9 the stable character or the District as a whole and is justified by substantial, articulated educ:stional considet'at.ions independent of the effect on the racial/ethnic composition of the schools affected; (2) The Board determines that the educational values expected from the enough to outweigh the adverse effects of the proposed on the racial/ethnic composition of the particular school or schools adversely af!ected; 233 Reproduced with permission of the copyright owner. Further reproduction rohibite

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(J) The Board has given to (i) the availability or alternative that might accomplish the desired educational objectives without the adverse effects on the racial/ethnic cocposition of the schools adversely affected; and (li) t::he feaslbil ity of additional measures to countera-::t:. or ameliorate the adverse effects, such as initiating special programs to encourage voluntary transfers that will improve the racialjethnic composition of the affected school or schools, converting such school or schools to magnet schools, 1 imiting new enrol lmer.t in such schools, or closing a school when it appears no reason;sbly practicabl-e m"!asures are available to prevent:. a school from becoming lncreaslngly tionate in its racial/ethnic composition. 5. The policies stated in Paragaph 4 govern all decisions concerning the construction ot ne schools, enlargement or existing school f.scilitles, and closing or scho.,ls. rn all decisions as to the location and site of ne"' schools or the expansion of existing schools, and in all decisions as to th"! closing of existing facilities, Boar-i shall, to the practicable in light of the of sites, fisc:tl resour-::es and educational needs, choose from among the available alternatives those most to and Fromot"! the integrat"!d character of the school syste111 and prcser"Je and prooote residential integration. 6. As demographic and residential patterns in the District chanqe, the Soard will for modit}inq present attendance patterns by creating additional schools with contiguous attendance areas where such changes can made in a manner consistent with Paragraphs 4 and 5. This pol icy J:'ests on the belief that both stable integration, based on residential integration, and other important educational values are served by fostering schools with a strong especially the elementary level. 7. The District shall, consist'!nt with gooc educational practices, maintain its present policy regarding assignment of so as to insure that no school is racially or ethnically identifiable by reason of the composition of its faculty. a. The District shall maintain a recruitir:; program that makeos every reasonable effort. to increase the propottion of teachers and in the Public School system. 234

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I I I I I I I I I I I I I j I i I i I I I I I i I I 9. The District maintain its present policies and as stated in DPS Policy 12260, regarding of to schools other than their school of assignment so as to minil!lize tt"ansfet"S that have rese:;r-eg:!ltive effects and to encourage transfers that enhance 10. The District shall maintain recor-d-'keeping and other procedures that enable it to monitor the to which imposition of dl.scipline, including suspensions and expulsions, .is disproportionate by racial/ethnic groups in each school, to investlg.1te the of such dispropot"tionlllity, and to take all practl.cable to insure that discipline is administered without racial discrimination or bias. 11. The District shall monitor ent"ollments in all and programs by race or ethnl.city and shall take such as are practicable, with educational to prc.mote integration wit.hln schools and 1.1ithin classro.:>aos and programs. 12. The District shall monitor its progre:.s .in enh
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RESOLtmON No. 25::9 'WHEREAS, the litigation has been terminated and full authority has been restored to the Board for governance of Denver's schools under the applicable laws of the United States and the State of Colorado; and WHEREAS, the District Court in its Order terminating jurisdiction noted that the Board would necessarily modify some provisions in its Resolutions 2233 and 2314 in dealing with future changes in the pupil assignment plan and that requirements of existing federal and state laws will materially and significantly affect the directions of the Denver Public Schools; and WHEREAS, the Board desires to reiterate its commitment to the objectives of Resolutions 2233, 2314 and 2505, and to policies and procedures that will both (1) clearly manifest its intention that the Denver Public Schools shall continue permanently to be operated as a. unitary school district with policies that will promote equal educational opporrunity for all students regardless of race or ethnic background, and (2) provide guidelines for future decision-making that will safeguard against resegregative actions by the Board; and WHEREAS, the Board believes it desirable to adopt a restatement of policy that reflects the new circumstances resulting from the Court's Order; NOW, THEREFORE. BE IT RESOLVED: 1. The Denver Public Schools shall be operated at all times in conformity with the United States Constitution, the Colorado Constitution, and all applicable federal and state laws. 2. This Board, the District, and officers aad employees of the District shall not adopt any policy or program. institute any practice or procedure, or make or carry out any decision for the purpose of discriminating against aay person by re:lSon of race. color, or ethrlic identificatioc.. 3. The primary goal, objective and policy of this Board. the District. and the officers and employees thereof is and shall continue to be to provide the ma:-
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individual schools. Rather, it means that the Board will pu...-sue the following goals, among others: a. All studentS, without regard to racial or ethnic baclcground, are given access to all educational opporrunities provided by the District. b. The resources of the District. both human and material, are allocated with the aim of providing each student the opportunity to achieve the essentials of an education according to the educational goals of the community as defined by the Board. c. One of the important educational goals of the school system is the provision of an integrated educational experience wherein studentS of different racial and ethnic backgrounds may learn together and thereby acquire an understanding and appreciation of their cultural differences, the values of diversity, and of the historical and linguistic conttibutions of all segmentS of our society. d. School buildings and other facilities are of such quality that no school may be identified as providing inferior or superior facilities for the education of pupils of a11y racial or ethnic background. 5. The District believes parental and community support and involvement within the schools is critical to the success of studentS in the District and the delivery of the educational program. and increased parental and community support is fostered and enhanced by parents having the oppommity for their children to attend school close to home as well as the ability to select from among the numerous educational offerings of the Disttict and to participate in site-based governance. 6. The District shall monitor ics progress in enhancing the achievement of all sruder::ts and will take all reasonably practicable measures to ensure that students of all racial and ethnic groups are given equal opportunity and encouragement to participate in eduotional opportunities such as gifted and talented programs, magnet school programs, theme schools, and other similar offerings. i. The Board will continue to pursue measures to promote integration by voluntary choice through magnet and special programs. 8. The District shall continue with its emphasis on long-range planning to assure the professional staff of resources and policy support for the continued exploration of emerging technology and methodology to accommodate the changing and diverse needs of staff, srudents and the community, throughout the entire District at every leveL 9. Recognizing that the number of minority applicants for teaching positions in the Denver Public Schools has been in decline. the Board desires to increase the District's effons to identify and recruit minority applicants. Accordingly, the Superintendent is directed to implement such additional measures, consistent with legal requirements of non. discrimination. as may be necessary to reach this goal. 237

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10. The policies as stated in this Resolution shall govern all decisions concerning changes in the pupil assignment plan. construction of new schcvls, enlargement of existing school facilities. and dosing of schools. In all such decisions, tLe Board shall require that specific data as to the effects of any such actions on the urJ
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! I I I 1 I l l I I I APPENDIX C State and Federal Statutes That Apply to the Operation of Denver's Public Schools Post-Keyes Legal Frame....-.<>rk The District has identified the following state and federal statutes that apply to the operation of Denver's public schools State laws rrtJe 22 of the Colorado Revised Statutes contains the General Education Laws of the State of Colorado, including the following provisions: Article 2. Estabfishes the State Board of Education, the Office of Commissioner of Education and sets forth their powers and duties Article 9. Contains the Certificated Personnel Performance Evaluation Act which establishes a provision for evaluation of certificated personnel and sets forth the duties of local boards of education in the evaluation process. Article 20. The Exceptional Children's Educational Act which contains provisions regarding gifted children and children with disabilities. Article 23. Education of migrate children. Article 24. English Language Proficiency Act wtlich establishes a program for English language proficiency Article 26. Gifted and talented students Article Z7. Educational clinics for public school dropouts. Article 28. The Colorado Preschool Program Act. Article 30. The School District Organization Act. Article 30.5. The Charter Schools Act. Article 31. Establishes the process for election of School District Directors Article 32. Contains the powers and duties of Scnool District Boards. Included within this article are the requirements that the School District have a written conduct and discipline code (22-32-109(1)(w)), mandatory procedures regarding assaults upon, disorderly conduct toward, harassment of or the making knowingly of a false allegation of child abuse directed toward a school teacher or a school employee or instances of damages occurring on the premises to the property of a teacher or employee (22-32-t09(x)). and specific duties regarding the employment of personnel (22-32-109.7 and 109.8). Section 22 32-110 contains specific powers for the Board of Education, including mandatory provisions SOURCE : Judge Matsch's Memorandum and Order September 12, 1995 (Releasing Denver Schools From Court Supervision : 67-69 239 Reproduced with OP.rmissinn nf tht=> ('()nHrinht f'\W n o r c: ..... r----...1 .. _.,_ .

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regarding student conduct and discipline (22-32-11 0(2)) and concerning the transportation of pupils pursuant to 22-32-113. Section 22-32-116.5 allows for the participation of students, who are nonresidents of the school district, in extracurricular and interscholastic activities. Article 33. The School Attendance Law of 1963 provides for compulsory school attendance (22-33-104), home-based education (22-33-104.5), procedures for suspension, expulsion and denial of admission (22-33-105), grounds for suspension, expulsion and denial of admission of students (22-33-106), and for enforcement of compulsory school attendance (22-33-107). Article 35. The Post-secondary Enrollments Option Act. Article 36. Public Schools of Choice Act. Article 44. School District Budget Law. A.""ticle 52. The Second Chance Program for problem students. Article 53, Part 2. Concerns educational achievement and includes provisions for local goals and objectives in plans to approve educational achievement in graduation rates. Article 53, Part 4. Education reform which provides for the adoption of content standards by school districts. Article 54. The Public School Finance Act of 1994. (The ability of the School District to obtain revenues may further be limited by the "Taxpayers Bill of Rights which is found in Article X. Section 20 of the Colorado Constitution.) Article 60. Contains provisions regarding teacher certification. Article 60.5. The Colorado Educator Ucensing Act of 1 991 Article 61. Concerns teacher employment and contains a prohibition against discrimination on the basis of religion of religious affiliation of any person seeking employment and prohibits any contract with a teacher to require by inference or otherwise that the teacher become a member of, or belong to, any group or organization. Title 24 of the Colorado Revised Statutes provides for the establishment of the Colorado Civil Rights Diviston and provides in Part 4 (24-34-401) that it is a discriminatory or unfair employment praCtice for an employer to refuse to hire, to discharge, or promote or demote, or to discriminate in matters of compensation against any person otherwise qualified because of 240

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I I I I I I I i I I I I I I I I I I I I I I I disability, race, creed, sex. age, national origin, or ancestry. Federal Laws Federal laws which impact the operation of Public SchoolS inClude the following : Gun-Free School Zone Act of t 990. 18 U.S.C. 921, et seq. Prohibits possession of unauthorized guns on school premises. The Drug-Free Workplace Act of 1988, 41 U.S.C. 701, et seq. Umits school a district's ability to receive grants unless it assures the provision of a drug-free workplace and programs respecting incfiVidual employees and the use of drugs or other controlled substances. Federal Omnibus Transportation Employee Testing Act of 1991, 49 U.S.C. 2717. Requires drug and alcohol testing of schOOl transportation employees. Individuals Wrth Disabilities Education Act. 20 U.S. C. 1400, et seq Provides for the education of children with cfiSabilities. Americans Wrth Disabilities Act 42 U.S. C. 12101, et seq. Prohibits discrimination in employment based on cf&Sability and requires that public schools be made accessible to disabled persons. Assignment or Transportation of Students, 20 U.S .C. 1651, et seq. Contains prohibitions against school busing to overcome racial imbalance. Equal Educational Opportunities and Transportation of Students, 20 U.S. C. 1701 et seq. Provides that all children enrolled in public schools are entitled to equal educational opportunity without regard to race. color, sex. or national origin and establishes the neighborhood as the appropriate basis for determining public school assignments and contains provisions restricting the use of transportation of pupils to achieve racial balance. Magnet Schools Assistance, 20 U.S.C. 3021, et seq Requires that a school district seeking funds for magnet school programs provide assurances that it will not discriminate based upon race, except to carry out an "approved plan, 20 u.s.c. 3027(b)(4). Title W of the Civil Rights Act of 1964, 42 U S.C. 2000c, et seq. Contains provisions relating to complaints of discrimination in public schools based upon race, authorizes initiation of actions with respect thereto, and imposes limitations on actions or programs designed to overcome or to achieve racial balance in any school. TiUe V1 of the Civil Rights Act of 1964, 42 U.S.C. 2000d, et seq. Prohibits exclusion from participation in. denial of benefits of, and discrimination under federally-assisted programs on the basis of race, color, or national origin. 241 Reproduced with OP.rmissinn of thP l"f'ln\trinht "uonor c ........ h,... ............................... ... : _ _ _ __ ._.,

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Siegel, Steven. 1991. "Race, Education, and the Equal Protection Clause in the 1990's: The Meaning of Brown v. Board of Education in Light of Milwaukee's Schools of African American Immersion". Marquette Law Review. 74: 501-511. Sleeter, Christine. 1988. Making Choices for Multicultural Education. Columbus: Bell and Howell. Smiley, Jerome C. Ed. 1901. History of Denver. Denver, Co: Denver, Times-Sun Publishing.:732, 735. Smylie, Mark A. et.al. 1995. "Educational Remedies For School Desegregation: A Social Science Statement To The U.S. Supreme Court in Missouri v. Jenkins". Urban Review. 27(3): 207-33. Spann, Girardeau. 1993. Race Against the Court: The Supreme Court and Minorities in Contemporary American. New York: New York University Press .. Spring, Joel. 1991. American Education: An Introduction to Social and Political Aspects. White Plains, N.Y.: Longmen Publishing Co.: 3, 6, 29. Stake, Robert. 1995. The Art of Case Study Research. Thousand Oaks, CA.: Sage Publications. Stave, Sondra Astor. 1995. Achieving Racial Balance: Case Studies of Contemporary School Desegregation: Contributions to the Study of Education. Westport, CO.: Greenwood Publishers. Steele, Roberta. 1993. "All Things Not Being Equal: The Case for Race Separate Schools". Case Western Reserve Law Journal. 32:591. Stillman. Richard. 1991. Preface to Public Administration: A Search for Themes and Direction. New York: St. Martin's Press.:12. Strauss, David A. 1989. Discriminatory Intent and the Taming of Brown". University of Chicago Law Review. 56(3): 935-1015. Taylor, Mary Jean. 1990. "Leadership Responses to Desegregation in the Denver Public Schools, A Historical Study: 1959-19n". Ph D. diss., University of Denver.:46, 61, 69, 97, 100, 138, 142, 161, 220 .. Thompson, Victor. 1961. Modem Organization. New York Knopf. Tucker, William H. 1994. The Science and Politics of Racial Research. Urbana and Chicago: University of Illinois Press. 257

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u. S. Commission on Civil Rights. 1975. Twenty Years After Brown. Washington D.C.: U.S. Commission on Civil Rights: 29. U.S. Commission on Civil Rights. 1977. Reviewing a Decade of School Desegregation 1966-1977: Report of a National Survey of School Superintendents: A Staff Report of the United States Commission of Civil Rights. Washington, D.C.: Commission on Cicil Rights. Unger, Roberto. 1983. The Critical Legal Studies Movement. Cambridge: Harvard University Press. Waldo, Dwight. 1956. Perspectives on Administration. University of Alabama: University of Alabama Press:29. Warren, D. R. ed .. 1978. History, Education, and Public Policy. Berkeley: McCuthan. Watras, Joseph. 1997. Politics, Race, and Schools: Racial Integration, 1954-1994. New York: Garland Publishing.37. Weider, Alan. 1994. "Race and Education: A Review Essay" Equity and Excellence in Education 27 (3): 76-84. Weinberg, Meyer. 1970. Desegregation Research: An Appraisal. Bloomington, IN.: Phi Delta Kappan. Weinberg, Meyer. 1979. A Chance To Learn: The History of Race and Education in the United States. London: Cambridge University Press. Wells, Amy Stuart. 1995. "Re-examining Social Science Research on School Desegregation: Long Versus Short-Term Effects" Teachers College Record. 4 (Summer): 691-706. West, Cornell. 1993. Race Matters. Boston: Beacon Press. White, Leonard. 1926. Introduction to the Study of Public Administration. New York: MacMillan Co. Wilkinson, J. Harvie, Ill. 1979. From Brown to Bakke: The Supreme Court and School Integration: 1954-1978. New York: Oxford University Press. Wilkinson, J. Harvie, Ill. 1995. ''The Law of Civil Rights and the Dangers of Separatism in Multicultural America". Stanford Law Review. 42: 993. Willie, Charles. 1984. "Access and Achievement". Currents. (Theme issue with title: "Commemorating Brown v. Board of Education of Topeka" 3(1): 24-33. 258

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Willie, Charles, Antoine M. Giraibaldi and Womie L Reed. eds. 1991. The Education of African Americans. New York: Auburn House. Wilson, Woodrow. 1887. "The Study of Administration", Political Science Quarterly 56(December 1941 ):481, 494(originally copyrighted in 1887). Winks, Robin W., Ed. 1979. The Historian As Detective: Essays of Evidence. New York: Harper and Row. Witcher, T. R. 1997. "Segregation Anxiety" Denver Westwon:f. Vol 20. No 22. (Jan 23-29): 18 (Greiner quote). Wall, Peter. 1963. American Bureaucracy. New York: W.W. Norton Co. Wolters. R. 1984. The Bun:fen of Brown: Thirty Years of School Desegregation. Knoxville: University of Tennessee Press. Woodson, Carter G. 1919. The Education of the Negro Prior to 1861. Washington, D.C.: The Associated Publishers: I, 34. Wortman, Pau! M. 1979. School Desegregation and Black Achievement: An Integrative Review. Ann Arbor: University of Michigan Press. Yarbrough, Marilyn V. 1995. "Still Separate and Still Unequal" William and Mary Law Review. 36(2): 685-702. Yin, Robert K. 1994. Case Study Research: Design and Methods (Second Ed). Thousand Oaks: Sage Publications: 1 Yudof, Mark. 1978. School Desegregation: Legal Realism, Reasoned Elaboration and Social Science Research in the Supreme Court". Law and Contemporary Problems: 57-110. Zlotnick, Marilyn S. 1981. Assessment of Current Knowledge About the Effectiveness of School Desegregation Practices. Nashville: Vanderbuiit University Press. 259

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Keyes v. School District No.1, 412 U.S. 189 (1973) LITIGATION CHRONOLOGY AND DOCUMENTATION Keyes v. School District No.1. 303 F. Supp. 279 (D. Colo.) ("Keyes f), modified, 303 F. Supp 289 (D.Colo. 1969) ("Keyes lr), order reinstated, 396 U.S. 1215 (1969) (Brennan J in chambers) ("Keyes 1/r); Keyes v. School District No.1, 313 F. Supp. 61 (D.Colo.1970) ("Keyes IV'); Keyes v. School District No.1. 313 F. Supp. 90 (D.Colo.1070) ("Keyes V'). affd in part and rev'd in part, 445 F. 2d 990 (10th Cir. 1971) ("Keyes Vr), cert. granted 404 U.S. 1036 (1972) and cert. denied sub. nom Schoo/ District No.1 v. Keyes, 413 U.S. 921 (1973), modified and remanded, 413 U.S. 189 (1973) ("Keyes Vlf),on remand, 368 F. Supp. 207 (D. Colo 1973) ("Keyes Vllf') and 380 F. Supp. 673 (D. Colo. 1974) ("Keyes /X"), affd in part and rev'd in part, 521 F. 2d 465 (10th Cir. 1975) ("Keyes X"), cert. denied, 423 U.S. 1066 (1976); Keyes v. School District No.1, 474 F. Supp. 1265 (D. Colo.1979) ("Keyes Xr); Keyes v. School District No. 1, 540 F. Supp. 399 (D.Colo. 1982) ("Keyes Xlr); Keyes v. School District No.1, 576 F. Supp. 1503 (D.Colo.1983) ("Keyes X//f) Keyes v. School District No.1, 609 F.Supp. 1491 (D.Colo. 1985) ("Keyes XIV'); Keyes v. School District No. 1. No. C-1499 (D. Colo. Oct 29, 1985) ("Keyes XV') (Order for further proceedings); Keyes v. School District No.1, 653 F. Supp. 1536 (D.Colo. 1987) ("Keyes XVf); Keyes v. School District No.1, 670 F. Supp, 1513 (D.Colo. 1987) ("Keyes XV/r), affd, 895 F. 2d 659 (10th Cir. !990) ("Keyes XVI/r), cert.denied, 498 U.S. 1082 (1991). 260

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Cases Dred Scott v. Sanford, 69 U.S. 393 (1857). Pfessy v. Ferguson, 163 U.s. 537 (1896). Cumming v. County Board of Education, 175 U.S. 528 (1899). Gong Lum v. Rice, 275 U.S. 78 (1927). Missouri ex ref. Gaines v. Canada, 302 U.S. 337 (1938). Sipuel v. University of Oklahoma, 332 U.S. 631 (1948). Sweatt v. Painter, 339 U.S. 629 (1950). McLaurin v, Oklahoma State Regents, 339 U.S. 637 (1950). Brown v. Board of Education of Topeka, (Brown I) 346 U.S. 483 (1954). Brown v. Board of Education (Brown II), 349 U.S. 294 (1955). Green v. County School Board of New Kent County, 391 U.S. 439 (1968). Alexander v. Holmes County Board of Education, 396 U.S. 19 (1969). Swann v. Charfotte-Mecklenberg Board of Education, 402 U.S. 1 (1971 ). San Antonio School District v. Roderiquez, 411 U.S. 1 (1973). Milliken v. Bradley, 418 U.S. 717 (1974). Pasadena City Board of Education v. Spangler, 427 U.S. 424 ( 1976). Milliken v. Bradley II, 433 U.S. 267 (1977). Wygant v. Jackson Board of Education, 476 U.S. 267 (1986). Riddick v. School Board of the City of Norfolk, Virginia, 784 F.2d. 521 (4th Cir., 1986). Cronson v. Clark, 484 U.S. 871 (1989). Board of Education v. Dowell, 498 U.S. 237 (1991). Freeman v. Pitts, 503 U.S. 467 (1992). Abbott v. Burke, 136 N.J. 444 (1994). Missouri. v. Jenkins, 115 S. Ct. 2083 (1995). Adarand Constructors, Inc. v. Pena, 115 S. Ct. 2097 (1995). Other Legal Articles of Confederation, 1878, Art. I, Section 2. Anti-Busing Amendment-Colo.Const. Art. IX, Section 8 (1974) (Prohibits busing for integrative purposes.). Poundstone Amendment-Colo Const. XIV, Section (1974) (Limits Denver's annexation capacity). Memorandum in Support of Motion to Intervene, City and County of Denver (1994):2-3. Plaintiffs Brief : Motion of Intervention of the City and County of Denver (1994):14 Board Brief : On the Impact of the Anti-Busing Clause of the Colorado Constitution (1994):5. Board Resolutions Related to Equal Educational Opportunity; 1490, 1520, 1542,1531,1533,2060,2233,2314,2529. Policy 51 00 261

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Newspaper Articles Denver Post, April 9, 1959. Denver Post, February 15, 1962. Rocky Mountain News, October 11, 1968. Denver Post, Sunday, May 5, 1974:77. Denver Post, August 30, 1974. Denver Post, January 14, 1879:40. Rocky Mountain News, January 14, 1979:8. Denver Post, November 13,1981:1b. Denver Post, March 3, 1981. Denver Post. February 10, 1984. Rocky Mountain News, February 16, 1984:8. Denver Post, March 5, 1984:7A Rocky Mountain News, April 15, 1984:1. Denver Post, May 22, 1985:1A Rocky Mountain News, January 4, 1992. Rocky Mountain News, September 22, 1992. Rocky Mountain News, May 18, 1994. Denver Post, August 18, 1994. Denver Post, August 26, 1994. Rocky Mountain News, May 1, 1995. Denver Post, January 23, 1992. Rocky Mountain News, April 2, 1992 Rocky Mountain News, May 5, 1993. Rocky Mountain News, May 19, 1994. Rocky Mountain News, August 18, 1994 Rocky Mountain News, August 19, 1994 Rocky Mountain News, August 21, 1994 Rocky Mountain News, August 25, 1994. Rocky Mountain News, August 28, 1994. Westward, January 1997: 18 Rocky Mountain News, January 7, 1998 262

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Archival Documents Special Study Committee on Equality of Educational Opportunity in the Denver Public Schools. Report and Recommendations to the Board of Education, School District No.1. Denver, Co.: Denver Public Schools, March 4, 1964: 1, 9, D-4, D-13, Appendix 36. Bardwell, George. Characteristics of Negro Residences in the Park Hill Area of Denver, Colorado-1966. Denver, Co: Denver Commission on Community Relations, April 1966. Advisory Council on Equality of Educational Opportunity in the Denver Public Schools. Final Report and Recommendations to the Board of Education, School District No.1. Denver, Co: Denver Public Schools, February 1967: 8, 182. Superintendent's Report (Gilberts). Planning Quality Education: A Proposal for Integrating the Denver Public Schools. Denver, Co: Denver Public Schools, October, 1968. Report From the Superintendent of Schools. John Finger Plan: Special Report. Denver, Co: Denver Public Schools, 1968. The Denver Public Schools. Report: Alternative Plans for lmplementiation of U.S. district Court Orders Stated in the Final Decree of June 1970. Denver, Co: Denver Public Schools, March 17, 1971. The Denver Public Schools. Interim Report: As Ordered By United States District Court on January 15, 1971 Setting Forth status of Defendant's Plan and Decision Regarding Implementation of Final Decree. Denver, Co.: Denver Public Schools, February 15, 1971. Bardwell, George. Segregation: A Social Account. Denver, Co.: Colorado Commission on Civil Rights (James Reynolds, Chair), March 1, 1971. Cardenas, Jose A. An Education Plan for the Denver Public Schools. San Antonio TX. National Education Task Force de Ia Raza, January 21, 1974. Office of the Superintendent. A Plan for Expanding Educational Opportunity in the Denver Public Schools: A Plan Submitted in Compliance With U.S. District Court Memorandum to Modfy Desegregation in School District No.1. Denver, Co.: Denver Public Schools, January 22, 1974. 263

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Desegregation Task Force. Report to the Board of Education on the Status of Pupil Assignments Related to the U.S. District Court Order. Denver Co: Denver Public Schools, March 1979. Ad Hoc Committee of the Board of Education Denver Public Schools. Unitary School System Plan:Final Report. Denver, Co.: Denver Public Schools, June 5, 1981. The Denver Public Schools, Pupil Assignment Plan for a Unitary School System as Directed by the United States District Court: The Concensus Plan of October 14, 1981 Combined with Educational enhancements Contained in the Total Access Plan. Denver, Co.: Denver Public Schools, March 30, 1981. Denver Public Schools. Report on Resolution #2233: 1989-90 School Year. Denver. Co.: Denver Public Schools, 1989. 264



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. I CONSTITUTIONAL TAX AND EXPENDITURE LIMITATION IN COLORADO: THE IMPACT ON MUNICIPAL GOVERNMENTS by Tommy M. Brown B.A., University of Texas at El Paso, 1963 J.D., University of Louisville, l969 A thesis submitted to the University of Colorado at Denver in partial fulfillment of the requirements for the degree of Doctor of Philosophy Public Administration 1999

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1999 by Tommy M. Brown All rights reserved.

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This thesis for the Doctor of Philosophy degree by Tommy M. Brown \ Date

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Brown, Tommy M. (Ph.D., Public Administration) Constitutional Tax and Expenditure Limitation in Colorado: The Impact on Municipal Governments Thesis directed by Professor Franklin]. James, Jr. ABSTRACT This study used all of Colorado's municipal governments as subjects for an interrupted pooled, time,series regression analysis focused on the effectiveness and impacts of two constitutional tax and expenditure limitation amendments (TELs). Municipal finance trends for more than twenty years were analyzed. Although the majority of states have imposed some statutory or constitutional restraint on specific taxes, only Colorado and California have adopted TEL amendments so encompassing that they purport to restrict virtually all revenues and expenditures to strict limits, unless the voters approve otherwise. Previous studies of TEL effectiveness and impact have not focused on municipalities or on municipalities of different populations. iv

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. I I The Buchanan and Brennan public choice theory of constitutional political economy contends that only constitutional amendment TELs are sufficiently enduring to restrain the growth of govetnment spending by withstanding the budgetary onslaughts of bureaucrats, politicians, and rent seekers. The study found that per capita municipal tax revenues were increasing rapidly in real terms prior to either of the rwo TELs. The primary purpose of the first TEL was to slow the growth of residential property tax and to redirect its incidence away from homeowners to business property owners. Findings suggest that after the first TEL, municipal revenues and spending did slow their annual rate of increase, but that property tax revenues unexpectedly spurted upward. After the second TEL prohibited all tax increases without voter approval and limited annual revenue growth to strict limits, municipal tax revenues stopped growing and showed slight annual decreases. Sales tax revenues continued to rise by less than two percent yearly, but property tax revenues were declining by nine percent annually. These new trends fell most heavily on the state's smallest towns, particularly rhose in sparsely populated agricultural counties. v

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The study concludes that the constitutional TEL spedfically limiting municipal revenue was effective for irs purpose, bur that one result may jeopardize the continued viability of small towns in economically stagnant areas. In the presence ofTELs, corollary theories that predict specific spending patterns favoring government's own purposes and slighting public services could be neither confirmed nor disproved. This abstract accurately represents the content of recommend its publication. I I ; I vi

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ACKNOWLEDGMENTS The conduct and completion of this project has been immeasurably supported by the encouragement, patience, and understanding of my family-Sally, Oint, and Peg. Not once did any of them ask, uy ou want to do what?" Thank you. The faculty and staff of the Graduate School of Public Affairs are owed my thanks for their encouragement and unflagging support. Professor Franklin James agreed to serve as chair of my dissertation committee, but he provided encouragement beyond anything required for that role. Professors Richard Stillman and Peter deLeon have been reachers and friends. Dean Kathleen Beatty has been most encouraging. Among the staff, Karen Wright, Antoinette Sandoval, and Dawn Savage have cheerfully answered any number of my less than astute questions. A measure of special gratitude is owed to Dr. Laura Argys for helping guide a statistics novice through some labyrinrhian paths. Finally, I must especially note the encouragement, friendship, and help of Mr. Sam Marner of the Colorado Municipal League. Sam unsparingly gave his time and I very much appreciate it. Thanks, also, to the Lincoln Institute of Land Policy, Cambridge, Massachusetts, for their generous grant of actual money to support the effort. For better or worse, the results of the effort are mine, but it was not done alone. TMB Denver, Colorado March, 1999

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CONTENTS Figures . . . . . . . . . . . . . . . . . . . . . . . xii I I T abies . -. . . . . . . . . . . . . . . . . . . . . . xviii CHAPTER L INTRODUCTION . . . . . . . . . . . . . . . . l Purpose of the Study . . . . . . . . . . . . . 6 The Setting . . . . . . . . . . . . . . . . . 6 Scope and Limitations of the Study . . . . . . 11 Importance to Public Administration . . . . . . 18 2. THE AMENDMENTS, THE COURTS, AND LEGAL ISSUES . . . . . . . . . . . . . . . 2 4 The TABOR Amendment's Provisions . . . . . 25 The Gallagher Amendment's Provisions ......... 29 TABOR and the Courts ....................... 32 Open Legal Issues and Interactions with other Laws ................... 40 3. 1WO LITERATURES: GOVERNMENT GROWTH AND TAX AND EXPENDITURE LIMITATION ...... 4 7 Introduction ................................ 4 7 viii

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! I 1 Limiting the Growth of Government . . . . . . 56 Have TELs Effectively Limited the Growth of Local Government? . . . . . . 59 Political Purpose . . . . . . . . . . . 64 Government's Reactions and Coping Strategies . . . . . . . . . . . 66 Problems from the Literature . . . . . . . . . 68 4. THE COLORADO ECONOMY, 1975,96 ............. 76 5. ASTUDYOFMUNICIPALFINANCES .............. 91 The Subjects ................................ 92 The Data ................................... 94 The Analytic Model ......................... 106 Statistics . . . . . . . . . . . . . . . . . 111 The Analysis . . . . . . . . . . . . . . . 114 Variations of the Regression Model . . . 114 Tabular Reporting . . . . . . . . . . 118 6. MUNICIPAL fiNANCES UNDER TAX AND EXPENDITURE LIMITATION . . . . . . . . . . 124 Introduction . . . . . . . . . . . . . . . 124 Revenues and Expenditures in the Aggregate .... 132 ix

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Revenues . . . . . . . . . . . . . . 132 Spending . . . . . . . . . . . . . . 155 The Economy's Influence . . . . . . . . . . 161 Election Experiences under Colorado's TELs . . 166 Small Town and Large City Trends . . . . . . 171 Small Towns on Colorado's Eastern Plains ....... 193 7. CONCLUSIONS ................................ 201 Findings and Interpretations .................. 209 Government Growth in the Absence ofT ax and Expenditure Limitation ....... 209 Growth After the First TEL (Gallagher) . 211 Growth After the Second TEL (TABOR) 212 TELs and the Eastern Plains ............ 217 The Economy's Impact ................. 218 Conclusions and Other Thoughts .............. 220 APPENDICES A. THE GALLAGHER AMENDMENT AND RELATED MATERIALS ..................... 226 B. THE TAXPAYER'S BILL OF RIGHTS (f ABOR AMENDMENT) ................................. 234 X

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C. REVENUE AND EXPENDITURE ACCOUNTS ...... 240 D. COLORADO'S MUNICIPAL POPULATIONS ....... 245 E. OAT A ASSUMPTIONS AND MUNICIP ALillES EXCLUDED FROM SlUDY ...... 2 70 F. INFLATION INDICES ............................ 281 G. TABLES OF STATISTICAL RESULTS ............. 282 REFERENCES . . . . . . . . . . . . . . . . . . . . . . . 3 12 xi

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AGURES Figure I 4.1 .I 4.2 I 4.3 U.S. Gross Domestic Gross Product (GDP) (Real), 1975,96 ..... 78 U.S. Treasury Bill (9Q,day) Interest Rates, 1975,96 ........... 80 U.S. Domestic Crude Oil First Purchase Real Price, 1975-96 .... 82 4.4 Colorado Average, Real, Per Capita Retail Sales, 1974,95 ...... 83 4.5 Colorado Real State Gross Product, 1977-96 ................. 84 4.6 Comparison ofU. S. and Colorado Civilian Annual Unemployment Rates, 1975,96 ............................ 85 4. 7 Colorado Net Migration, 1975,96 ......................... 86 4.8 Colorado Municipal Population (estimated), 1975,96 .......... 87 4.9 Colorado Mean Annual, Real, Per Capita Construction Earnings, 197 4-9 5 . . . . . . . . . . . . . . . . . . . 88 6.1 Municipal T oral Revenues and Operating Expenditures, 1975-96 .................................. 125 6.2 Colorado Per Capita Personal Income (real dollars, 1975=100), 1974-96 ......................... 127 6.3 Mean Colorado Farm Income by Counties (real, 1975=100, per capita dollars), 1974-95 ................ 128 xii

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6.4 Mean Colorado Manufacturing Earnings by County (real, 1975= 100, per capita dollars), 1974-95 ................ 129 6.5 Mean Colorado Services Earnings by County (real, 1975= 100, per capita dollars), 1975-95 ................ 130 6.6 Comparison of Annual Change Trends in Total Municipal Revenues (Percent of Annual Increase) 1975-84; 1985-92; and 1993-96 ........................... 133 6. 7 Municipal Revenue Sources in 1996 (Actual Dollars) ......... 135 6.8 Comparison ofT rends in Total Municipal Tax Revenues (percent of annual increase based on real, per capita dollars) 1975-84; 1985-92; and 1993-96 .............. 136 6.9 Comparison ofT rends in Municipal Sales Tax Revenues (percent of annual increase based on real, per capita dollars) 1975-84; 1985-92; and 1993-96 .............. 138 6.10 Comparison ofT rends in Municipal Property Tax Revenues (percent of annual increase based on real, per capita dollars) 1975-84; 1985-92; and 1993-96 .............. 140 6.11 Comparison ofT rends in Charges for Services, Fines, and Licenses and Permits (percent of annual increase based on real, per capita dollars) 1975-84; 1985-92; and 1993-96 ....... 148 6.12 Comparison ofT rends in Miscellaneous, Specific Ownership Tax, State Aid, and Enterprise Transfer Revenue (percent of annual increase based on real, per capita dollars) 1975-84; 1985-92; and 1993-96 .............. 150 6.13 Comparison ofT rends in Nine Municipal Expenditure Accounts 1975-84; 1985-92; and 1993-96 .................. 156 xiii

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6.14 Comparison ofT rends in Four Municipal Expenditure Accounts 1975-84; 1985-92; and 1993-96 .................. 159 6.15 Comparison of Post-TABOR Trend Percentages with Economic Indicators Controlled and without Economic Indicator Controls in Four Revenue Variables ............... 164 6.16 Comparison ofRevenue Trends for Municipalities with Successful Elections vs. Municipalities without Successful Elections . . . . . . . . . . . . . . 168 6.17 Comparison of Expenditure Trends for Municipalities with Successful Elections vs. Municipalities without Successful Elections ............................. 170 6.18 Comparison of Property Tax Revenue Trends by Population Groups with Assessed Property Values Controlled ............ 175 6.19 Comparison ofTotal Municipal Revenues by Population Groups 176 6.20 Comparison ofT oral Municipal Tax Revenues by Population Groups . . . . . . . . . . . . . . . . . 179 6.21 Comparison of Sales Tax Revenue Trends by Population Groups . . . . . . . . . . . . . . . . . 180 6.22 Comparison of Property Tax Revenue Trends by Population Groups . . . . . . . . . . . . . . . . . 182 6.23 Comparison ofT oral Operating Expenditure Trends by Population Groups ...................................... 185 6.24 Comparison of General Government Expenditure Trends by Population Groups . . . . . . . . . . . . . . . . . 188 xiv

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6.25 Comparison of Law Enforcement Spending Trends by Population Groups . . . . . . . . . . . . . . . . . 190 6.26 Comparison of Culture and Recreation Spending Trends by Population Group . . . . . . . . . . . . . . . . . . 192 6.2 7 Comparison of Revenue Trends for 59 Eastern Plains Municipalities . . . . . . . . . . . . . . . . . . . . 198 0.1 Summary of Regressions for Aggregated Municipalities (with Economic Variables) ............................... 283 0.2 Revenue and Expenditure Coefficients as Percentages for Aggregated Municipalities . . . . . . . . . . . . . . 284 0.3 Summary of Regressions with Economic Variables for Population Group 1,999) .............................. 285 0.4 Summary of Regressions with Economic Variables for Population Group .......................... 286 0.5 Summary of Regressions with Economic Variables for Population Group .......................... 287 0.6 Summary of Regressions with Economic Variables for Population Group ........................ 288 G. 7 Summary of Regressions with Economic Variables for Population Group (50,000-99,999) ........................ 289 G.8 Summary of Regressions with Economic Variables for Population Group (100,000+) ............................ 290 G.9 Comparison ofT rend Percentages for Population Groups ...... 291 XV

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I 0.10 Comparison of Gallagher Intervention Percentages for Population Groups ................................... 292 0.11 Comparison ofT ABOR Intervention Percentages for Population Groups ................................... 293 0.12 Comparison ofT rend and Intervention Percentages for Population Group (1, 1,999) ........................... 294 0.13 Comparison ofT rend and Intervention Percentages for Population Group (2,000-4,999) ....................... 295 0.14 Comparison ofT rend and Intervention Percentages for Population Group (5,000,9,999) ....................... 296 0.15 Comparison ofTrend and Intervention Percentages for Population Group (10,000,49,999) ..................... 297 .. 0.16 Comparison ofT rend and Intervention Percentages for Population Group (50,000,99,999) ..................... 298 0.17 Comparison ofTrend and Intervention Percentages for Population Group (100,000+) ......................... 299 0.18 Comparison of Population Group Trend and Post-Intervention Percentages ............................ 300 0.19 Summary of Regressions Comparing Municipalities with Successful Elections vs. Municipalities without Successful Elections . . . . . . . . . . . . . . . . . . . . . . . 302 0.20 Summary of Revenue and Expenditure Regressions without Economic Variables .............................. 303 0.21 Revenue and Expenditure Coefficients as Percentages without Economic Variables .............................. 304 xvi

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0.22 Comparison of Revenue and Expenditure Variables-Effect of Economic Indicators . . . . . . . . . . . . . . 305 0.23 Comparison of Population Groups-Property Taxes with Assessed Value as an Independent Variable . . . . . . . . 306 0.24 Components of Total Municipal Revenue (Percent) by Groups 307 0.25 Summary of Regressions-Economic Variables . . . . . . . 308 I 0.26 Summary of Regressions with Economic Variables for Eastern Plains Group . . . . . . . . . . . . . . . . . . 309 0.2 7 Eastern Plains Group Coefficients as Percentages . . . . . . 311 xvii

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TABLES Table 1.1 Tax and Expenditure Limitations on Municipal Governments ... 20 2.1 Residential Assessment Ratios . . . . . . . . . . . . . . 30 5.1 Number of Colorado Municipalities by Population Groups ...... 94 5.2 Municipalities Studied by Groups ......................... 117 6.1 Descriptive Statistics for Municipalities of 1 to 1,999 Population (1996 Actual Per Capita Dollars based on 1996 Population) (N = 168) ............................................ 194 6.2 Components (as a percentage) of Total Municipal Revenues ( 1996) by Groups . . . . . . . . . . . . . . . 197 E.1 Municipalities Eliminated from the Study . . . . . . . . . 2 71 E.2 Reported Zeroes for Each Dependent Variable (N=5,610 for each) ..................................... 274 E.J Comparison of Regression Results between All Municipalities and Municipalities without Zero Data Observations . . . . . . . . . . . . . . . . 2 77 xviii

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CHAPTER I INTRODUCTION I I Almost as soon as the first seeders stepped ashore, Americans began to fret about the taxes they pay a:1d the growth of their governments. Among the chief complaints of the Declaration of Independence was that the British government had "erected a multitude of New Offices, and sent hither swarms of Officers to harass our people, and eat out their substance." Government was just too expensive-"imposing taxes on us without our Consent." Before the revolution, Americans protested "unfair" taxes by marching on the government in North Carolina's 1771 "War of Regulation" (Morison, 1965, p. 196). Even after they had their own government, Americans continued to protest taxes and government growth. This study is about these two ideas-the growth of government and citizen efforts to contain it. In 1982, Colorado voters approved a constitutional amendment referred to them by the legislature. Proponents of this Gallagher 1

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I I I I I amendment1 were responding in the tradition of California's Proposition 13 to homeowner concerns about a rising burden of property taxes. As Colorado was growing, new residential property was coming on to the tax rolls at a pace significantly ahead of new business and commercial properties. The concern was that if the trend continued, residential owners would bear a property tax burden much greater than owners of nonresidential properties. In its attempt to address the issue, the Gallagher amendment mandated a legislative study to determine the then-existing proportion of statewide property tax collections from residential property owners and collections from owners of all other classes of property. Once the ratio was determined (45 percent residential to 55 percent all other), the amendment mandated biennial adjustments to the residential property assessment rate so that the proportion of tax collected from each group would remain fixed. Beginning with a 21 percent residential assessment rate in 1985, the rate has been continually adjusted downward to its 1998 level of9-V-J percent. 1 The fuli text of the Gallagher amendment is comained in Appendix A and its terms are explained in greater detail in Chapter 2. 2

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I I Ten years later, in 1992, a citizen-initiated petition led to an election in which Colorado's voters approved another amendment to the state's constitution. This second tax and expenditure limitation2 amendment limited the amount of growth in revenues and expenditures for the state and all local governments. Legally entitled "The Taxpayer's Bill of Rights," the amendment is also known as the "Bruce Amendment" (after its chief proponent, Douglas Bruce), "Amendment One" (after its numerical designation on the ballot), or, most prevalently, by its acronym "T ABOR."3 [t mandates that, beginning with 1993, state and local government revenues and expenditures cannot increase from one year to the next by more than inflation and a defined growth factor. If revenues exceed the allowed amount, the government must either ask voter approval to keep the excess, or refund it to taxpayers. Likewise, any prospective increase in revenues by 2 In the scholarly literature, the phrase "tax and expenditure limitation" is universally abbreviated as "TEL" or "TELs." 3 One suspects that Mr. Bruce chose the acronym, TABOR, and then, fit a name to it. The acronym is that same as a famous Colorado name taken from silver-mining baron Horace Tabor and his scandalous much younger wife, Elizabeth "Baby" Doe Tabor. Mr. Tabor lost his fortune in the silver crash of 1893 and died in 1899. Mrs. Tabor became a legend "standing by her man" at the long depleted Matchless silver mine until her death in 1935. 3

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tax increase, mill levy increase, policy change, etc., must be approved by voters.4 Much like the combination of California's Proposition 13 (now codified as Article XIIIA of the California constitution) and California's subsequently adopted Article XIIIB,5 Colorado's two TEL amendments attempted, first, to address property tax issues and, then, imposed strictly defined growth limits on the state and all local governments. Study of and discussion about California's experience has been extensive and the conclusions have sometimes been contradictory. Despite the passage of time, there has been no similar study or discussion of the Colorado experience. 0 4 The full text ofTABOR is set out in Appendix Band its terms are explained in greater detail in Chapter 2. 5 In an obvious effort to promote perpetual confusion, Proposition 13 {its numerical designation on the ballot) was codified as part of Article XIUA of the California constitution. Subsequently, other adopted propositions (with other ballot were codified in Articles XIIIB (Proposition 4, the t979 spending limit), XIIIC (Proposition 2 tB, a 1996 requirement for voter approval of local tax levies), and XI liD (more Proposition 218, related to assessment and property related fee reform). A full history of the many propositions codified into Article XIIIA, B, C, and 0 is available from Freidrich (t999). 0 Acknowledging that it has not surfaced in the academic journals is not meant to denigrate the extensive discussion and valuable analysis conducted by municipal officials, the media, and others in Colorado. 4

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Expectations of the Gallagher amendment were that it would save homeowners money and, indeed, the Colorado Division of Property Taxation reportS that the savings have totaled more than $3.1 billion from 1985 through 1997 (Colorado, 1998, p. 11-12). Stronger consequences were expected of the TABOR amendment, particularly when its interaction with the ocher amendment were considered. The common wisdom was that as Gallagher ratcheted residential assessment ratios down and TABOR prohibited mill levy increases to recoup the lost revenue, local governments would be faced with some drastic decisions about spending cuts. On its face, an amendment such as TABOR would be expected to have a much broader impact on local government revenue growth than other, more common TELs that limit only property tax increases. Nevertheless, as will be seen in Chapter 3, existing research, mostly from California and Massachusetts, and mostly considering state budgets, suggests that TABOR's effectiveness in curtailing revenue and spending growth may be limited. 5

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I Puroose of the Study This study examines the revenue and spending trends of Colorado's municipal governments before the Gallagher amendment, during the interim period between the two amendments, and after the TABOR restraints were imposed. The purpose is (1) to determine whether Colorado's municipal governments were growing as has been the general academic and popular assumption, (2) to determine if Gallagher and TABOR were effective constraints and to assess the impacts if they were, and (3) to decide whether some assessment can be made about how municipal governments have responded to the amendment. The Setting Colorado's adoption ofT ABOR followed in the vein of the latest I American tax revolt, said to have begun with California's Proposition 13. "Prop 13" was placed on the ballot by citizen petition under the initiative process. It wa:; approved by California voters in 1978. Concerned only with an increasingly burdensome property tax, Proposition 13 imposed a ceiling on propertY taxes equal to one percent of assessed value (Kirlin, 1982) and 6

PAGE 25

immediately reduced average property taxes (Sherwood#Call, 198 7, p. 60 and Wiseman, 1989, p.1). i I Two years after California voters upset the tax apple cart, Massachusetts voters, again focusing only on property taxes, adopted Proposition 2 Yz as their own effort to cue and control property tax growth. Generally it reduced the property tax rate co 2 Vz percent of market value and limited further growth in local government property tax revenues co 2 Vz percent, plus an annual growth factor (Bradbury, 1991, p. 3). Ic included provisions allowing local voters to approve additional property tax levies by adopting exceptions to the overall formula. Colorado's voters have long been concerned with taxes and the growth of government. Anti#tax initiatives have been a rather regular feature of Colorado ballots. Mindful of this widespread sentiment, and particularly in response to concerns about the property tax, the 1982 legislature referred the Gallagher amendment to voters. After adoption, it added to and amended Article X, Sections 3 and 15 of the Colorado Constitution. Gallagher promised lower property taxes for homeowners by 7

PAGE 26

its mandated periodic adjustments in residential property assessment ratios, but it did not purport to limit local government revenues or expenditures. In 1986, an initiative that would have required state and local officials to obtain majority voter approval, at biennial general elections, before imposing new or increased taxes was defeated by more than a twenty percent margin (Smith, 1996, p. 2 7 4). Although not the primary proponent of this initiative, Douglas Bruce, a non,practicing attorney and landlord, newly arrived from California, had participated in the election effort and associated himself with it. After the 1986 failure, Bruce formed his own political committee, named it the Taxpayers Bill of Rights Committee, and sponsored another, more ambitious attempt at limiting taxes and government in 1988. The effort garnered only 38 percent of the vote (Smith, 1996, p. 2 77). Undaunted, Bruce tried again in 1990, losing by 51 to 49 percent (Smith, 1996, p. 279). On his third attempt, in 1992, the indefatigable Bruce was successful and the TABOR amendment passed with about 54 percent of the vote (Smith, 1996, p. 271).7 7 Smith, D. A. (1996). Populist entrepreneur: Douglas Bruce and the tax and government limitation moment (sic) in Colorado, 1986,1992, Grear Plains Research, 6 (Fall), 269-294, is a good, succinct history of TABOR and Bruce's involvement in it. 8

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As a citizen initiated tax and expenditure limitation, TABOR added Section 20 to Article X of the Colorado Constitution. It became legally effective on December 31, 1992, and specifically limits government growth in revenues from all taxes, not just the property tax. Although Gallagher does not purport to directly limit any municipality's revenues, its adoption may have sent a "message" of taxpayer sentiment to local governments. More explicitly, Gallagher and TABOR may well interact with each ocher as Gallagher reduces residential assessment ratios and TABOR prohibits property tax or mill levy increases without voter approval. Thus, a largely residential municipality might find its property tax revenue declining because of Gallagher and, due to TABOR, be unable to replace that revenue without voter approval. Because of their explicit and potentially indirect effects and interactions, both amendments are discussed. Just as lay citizens have long been concerned with the growth of government and effective ways to curtail or control char growth, scholars have argued for, and attempted to rest, various theories as co why government grows and how its growth might be effectively limited. One of rhe many theories seems more directly applicable co Colorado's experience 9

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than some of the others. Brennan and Buchanan (1980) contend that the "constitutional political economy" paradigm is particularly useful in examining fiscal limitations such as California's Proposition 13 (and, by analogy, Colorado's TABOR) because these are dtizen,initiated decisions changing the constitution of the existing political system. They follow the earlier lead of Niskanen (1971) and theorize (1) that government may be modeled as a "Leviathan" revenue maximizer, (2) that the normal electoral cycle of voting representatives in and out of office does not constrain the growth of government, and (3) that, therefore, the only effective constraints are long,term fiscal limitations imposed by the voters (see also, Borcherding, 1977; Niskanen, 1975; and Wagner, 1975). Not only do Brennan and Buchanan contend thac govemmem is a revenue, maximizer, they also theorize that if faced with fiscal restraints, government will prefer to evade the restraints or to spend for its own purposes to the detriment of spending on desired public services (Brennan & Buchanan, 1980, p. 136, 144; Hale, 1993, p. 118; and Bails, 1982, p. 136, 138). In other words, if restrained, government will take advantage of any "loopholes" available. 10

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Although many more theories are considered by this study in Chapter 3, two of these-government as revenue-maximizer and government as a maximizer of its own, internal benefit have particularly informed the direction of this research. Scope and Limitations of the Study Within this context, the Colorado experience provides an opportunity to empirically explore some of the more prominent theories about tax and expenditure limitations and their effectiveness in limiting the growth of government. Prior to the TABOR amendment, local governments in Colorado were restricted in their ability to raise taxes without voter approval, 8 but once tax rates and mill levies had been established, the amount of revenue generated and spending of those revenues could freely rise without further voter approval. After TABOR, 8 Under long-standing Colorado statutes and constitutional provisions, municipalities were required to seek voter approval for new taxes and, generally, for increased tax rates. Even with voter approval, municipal sales tax races were limited, with some exceptions, co as much of seven percent as was left after che state and county races were subtracted (C.RS. 1997 -2-108). After public budget hearings, but without further voter approval, municipalities were free to raise property tax mill levies by as much as percent each year (C.R.S. 1997 -1-301). 11

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these local governments were constitutionally required to obtain specific voter approval for almost all revenue and spending increases, whether or not tax rate increases were contemplated. In its endeavor to assess the effectiveness of these two TEL amendments and the municipal response to them, this study examines data for eleven revenue and fourteen expenditure categories,9 for the 22-year period from 1975 through 1996, for essentially all of Colorado's municipalities. The analysis uses a standard pooled, cross-section, timeseries regression model as described by Sayrs (1989), Greene (1997), Kmenta (1986), Johnson (1995), and judge, et al., (1988). In general terms, the model uses a time variable for the overall trend, a program variable for each of the cwo amendments, six lagged conrrol variables for economic indicators, and a dichotomous control variable for each municipaliry. The resulting regression equation was calculated with real, per capita data (converted to natural logarithms) for each of the revenue and expenditure accounts as dependent variables 0 Appendix C contains a listing of all the revenue and expenditure categories considered with a description of each. 12

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There are some basic assumptions made throughout the study. First and foremost among them is that municipal government growth can be validly measured by the monetary metric of its revenues and expenditures. Municipal governments might be perceived to grow in any number of ways that may not involve increases in revenues or expenditures. For example, they can surely grow in the perception of the citizenry by imposing more numerous or more onerous regulations and mandates, even though these may be reflected only slightly, if at all, in municipal budgets. Nevenheless, this study relies solely on data regarding municipal revenues and expenditures, because it assumes these are valid measures. The study assumes, also, that the data are reliable. It is prepared by I individual municipal governments and assembled by the Colorado : I j Department of Local Affairs. The assumption is made that none of the data has been fraudulently submitted and that it is accurate despite human propensity for the occasional error. Nevertheless, there are five caveats about the data that must be acknowledged at the outset. (1) Replication would be hampered somewhat because some of the economic and demographic data may subsequently 13

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I I have been revised by the government agencies that produce it. (2) The municipal population data used in per capita conversions is based on annual estimates of the Colorado Department of Local Affairs, rather than on actual census counts. (3) Conversions from actual to real (inflation, adjusted) dollar amounts was based on the Denver-Boulder Consumer Price Index (CPI) as prepared by the U.S. Bureau of Labor Statistics. Although this index may not accurately reflect the inflation experienced by local governmencs, especially those outside the Denver-Boulder metropolitan area, it was used because the TABOR amendment makes it the legal definition of inflation. (4) The economic data used in the study, i.e., personal income, unemployment rate, farm income, construction earnings, manufacturing earnings, and retail sales, is available only on a county-wide basis rather than specifically for each municipality. For this study, the county-wide data was applied to each city principally located within the county. (5) Finally, the Colorado Economic and Demographic Information System (CEDIS) recognized 2 72 legally incorporated Colorado municipalities.10 Seventeen of 10 These recognized, legally incorporated municipalities are listed in Appendix D. 14

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these were not included in the regression models because more than six years of data was missing for them during the study period. 11 The remaining 255 municipalities were included. Because the municipalities were aggregated in various groups for study and because of limitations inherent in the model, the results and findings are applicable only to the municipalities studied and cannot be generalized to individual cities or towns in or out of Colorado. This study makes no attempt to determine whether government growth is within or without some acceptable or desirable limit. The very term "government growth" has come to carry a pejorative connotation as an evil to be avoided. On its face, such an argument implies that the desirable goal is that municipal revenues and spending absolutely would not rise from one year to the next. However, without accounting for at least inflation, population increases, and economic conditions, such a goal would be effectively a shrinkage in the public goods and services supplied by municipalities. 11 They are listed in Appendix E, along with the specific reason for their deletion from the study. 15

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If government grows beyond these adjustments for inflation, population, and the economy, will it have grown too much, just enough, or not enough to meet the demand for its services or the desires of its citizens? The answer to this question is for other researchers and other studies. This one seeks only to determine whether growth has occurred and if Gallagher and TABOR affected the trend of any such growth. Many of the possible effects of government growth or restraint will be explored, but, ultimately whether something dire or delightful has occurred is an issue not considered here. Similarly, this study looks at changes in the patterns and trends of specific revenue sources and specific spending activities and asks whether these might have changed after the Gallagher and TABOR amendments became law. Again, the study will explore some of the ramifications of these trends, but it does not answer whether any such discovered trend or pattern changes have been desirable. Finally, a major limitation of the study is that it explores only one of Colorado's several forms of government. As of 1993, the year after TABOR's adoption, there was one state government, 63 counties, 267 cities 16

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or towns, 176 school districts, and 1,467 special and other districts (Colorado Public Expenditure Council, 1993). This study confines itself to only the cities and towns; whose number had grown to 2 72 by the time this effort was begun. Although studying only one form of the many governments made the effort much more manageable, it creates a serious void concerning intergovernmental relationships and interactions. Just as the two amendments have apparently interacted, probably in some ways nor at all anticipated, local governments in the state are not isolated one type from the others in all respects. The impacts on one form of government may produce reactions that, in turn, affect other forms of government. Some of this interaction is enshrined in law .12 Some of the interactions are not mandated by law, but may be just as real. Some of these possibilities will be discussed, but, at the end, neither this study nor any other can present a completely accurate picture of the effects of these laws without considering all of the governments affected. 12 For example, counties are required to build and maintain courthouses for the state's district judicial system. 17

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Imponance to Public Administration The most elaborate study would be useless if nobody cared about the questions asked and the answers proffered. In this instance, the findings and results lie at the hean of the political, economic, and public opinion ecology within which public administration as an academic endeavor, as a profession, and as a concern of the citizenry exists. Are municipal governments really growing, and, if so, how much? Is it possible for voters to control and even cunail government growth by citizen initiated constitutional amendments? Did Gallagher and TABOR alter the revenue and expenditure structure oflocal government (Shadbegian, 1998, p. 133)? Is government reliance on the much disliked property tax waxing or waning? Are there some government services that fare better or worse under a regimen of tax and expenditure limitation? As the literature reviewed below and in Chapter 3 indicates, statutory TELs have been researched as they exist in other states, but Colorado's TEL amendments have not been scientifically investigated. To illustrate the uniqueness of Colorado's circumstances and the opportunity it presents to study the impact of a constitutional, encompassing TEL, Table 18

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1.1 shows the University of Colorado's Fiscal Discipline Project listing of the tax and expenditure limitations on munidpal governments in the United States. Only Colorado has imposed an overall, general limit on the revenues of its cities and towns, although Arizona (since 1921), California (since 1979), and Colorado (since 1992) impose limits on overall municipal spending.13 Thirteen states impose no limit on the revenue or spending of their municipalities. The remaining 34 states impose only some variation of a limit on property taxes. 13 This observation is made with trepidation and reservation because even though California is listed as having only a spending limit TEL; the listing may be accurate in only a most technically abstruse sense. This is not a comparative study and, hence, not the place 1:0 expound at length on the full legal meaning of Article XIIIB of the California constitution, but in operation it does, first, proscribe appropriations (spending) over a defined growth limit, but then, it requires that unappropriated revenues (the amount collected in excess of appropriations) be refunded co taxpayers. This seems to be close co a revenue limit. 19

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Table 1.1 .I Tax and Expenditure Limitations on Municipal Governments Original Dates of Enactment Overal Specific Property Assessment General General Property Property Tax Tax Increase Revenue Expenditure State Tax Rate RateUmit Revenue Umit Umit Umit Alabama 19n 1875 Alaska 1972 19n Arizona 1980 1913 1980 1921 Arkansas 1883 1981 caJifomia 1978 1978 1979 Colorado 1992 1913 1992 1992 Florida Idaho 1978 1967 Illinois 1961 1991 Indiana 1973 lcwva 1972 1978 Kansas 1970 Kentucky 1908 1979 Louisiana 1974 1978 Maryland 1957 Massachusett 1980 1980 Michigan 1949 1978 Mississippi 1980 Missouri 1875 1980 Montana unknown date 1987 Nebraska 1957 1990 Nevada 1936 1929 1983 New Mexico 1914 1973 1979 1979 NewYOfk 1894 1986-NYC North carolina 1973 North Dakota 1929 1981 Ohio 1929 1976 Oklahoma 1933 Oregon 1991 1916 Pennsylvania 1959 Rhode Island 1985 South Dakota 1915 Texas 1876 1982 Utah 1929 Washington 1944 1973 1971 West Virginia 1939 1939 1990 1890 The following states have no TELs for their municipalities: Connecticut, Delaware. Georgia, Hawaii, Maine. Minnesota, New Hampshire, New Jersey, South Carolina, Tennessee, Vermont, Virginia, and WISCOI1Sin. 20

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' I Several researchers have studied changes in the government spending patterns after a TEL was adopted. McCaffery (1978) reviewed California's ex(:erience with Proposition 13 and listed a variery of examples in which school districts eliminated summer programs and classes with small attendance. The focus of Kemp's (1982) assessment was that local governments in California reduced spending on non,essential services such as libraries, but did not reduce the budgets for more essential fire and police services. Ladd and Wilson (1985a) noted that Proposition 2 Vz resulted in modest cues in Massachusetts' school budgets, but almost no change in fire and police budgets. McKinley (1984) observed that California schools cut such programs as summer school and adult education. Vincent (1984, p. 18) said chat the most common cutback for California schools was supervision of the teaching faculty. Rothenberg and Smoke (1982, p. 101) said that police, fire, and sanitation services were sheltered from cuts in Massachusetts, but that parks, streets, and possibly libraries seemed expendable. In his study of California's cities and their responses to Proposition 13, Reid (1988) concluded that spending patterns were altered in favor of 21

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"highly visible essential services," such as police, fire, and health. He found a large shift away from spending categories that did not produce "final services that are easily and immediately observed by the electorate (e.g., general government and public works ... ) significant reductions in "desirable but non,essential services" such as parks and libraries, and a large increase in enterprise activities (Reid, 1988, p. 26). Given the similarities between the California and Colorado TEL provisions that limit spending, the expectation should be that the Colorado and California responses will be somewhat similar. Unfortunately, the Reid study did not address municipal responses in the form of proposals ro the electorate for its approval, although he did conclude that cities had not behaved as "agenda,setting monopolists, threatening citizens with draconian cuts in essential services in order to force voters co support excessive increases in local taxes .... (Reid, 1988, p. 34). Others, such as Tod6-Rovira (1991), who developed an income, weighted model of demand for public goods, Borcherding and Deacon (1972), who studied price and income elasticities for various public goods, 22

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and DeBartolo and Fortune (1982), who also studied tax,price elasticities for public services, have lent some insights to the issue, but they did not directly study the effects of a TEL as encompassing as TABOR. This research may be instructive for concerned citizens, public administration professionals, and academics alike. For the professional, the results may suggest strategies for coping with TELs. The study also may serve as an aggregate benchmark of trends and policy implications against which the experiences and issues of individual municipalities can be examined and discussed. For the academic, this research may answer some of the questions now pending, test well, known theories, and suggest other avenues for further research and consideration. Some of the extant theories may require modification or reconsideration. For the citizen, the information from this study may allow a more accurate, independent assessment municipal government performance over the past two decades, and whether its responses to Gallagher and TABOR have been acceptable. 23

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. I I I I CHAPTER2 THE AMENDMENTS, THE COURTS, AND LEGAL ISSUES At the end, this study will report its findings about the effects Gallagher and TABOR have had on Colorado's municipal governments and their citizens, but these findings will be in quantitative form. Whether they are statistically significant or not will be plain enough: whether they are practically significant will be a subjective opinion each reader will be free ro reach for herself or himself. Nevertheless, in order for it to be an informed opinion, it must be reached with some reasonably full understanding of what the two amendments are and what they purport to accomplish. As with any other law or constitutional provision, "what it purports to accomplish" is dependent not only on its own language, but upon court decisions that decisively determine what that language means. In the case of TABOR, the opportunities for the courts ro decide this meaning are abundant because the amendment was not written clearly or concisely. Many of its provisions are paragons of ambiguity. 24

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Given TABOR's importance to municipal citizens and governments in Colorado, given its ambiguities, and given the American penchant for litigation, it was probably inevitable that TABOR would create a cottage indus cry of plaintiffs asking courts to clarify its meaning for this purpose or that. The resulting decisions determine how municipalities implement and comply with the amendment. As one other complicating factor, TABOR was not written on a blank slate. It is in a constitution that already contained provisions with which TABOR must interact. This chapter discusses the meaning ofT ABOR's provisions, its interaction with the Gallagher amendment and other laws, the judicial interpretations that form context within which TABOR operates, and the implementation questions raised, but not yet decisively answered. I I The TABOR Amendment's Provisions Like irs California and Massachusecrs progenitors, TABOR has specific provisions regarding property tax, but it goes considerably beyond the scope of Propositions 13 and 2 Vz because it encompasses much more than just property taxes. Akin to the entirety of California's Articles XIIIIA and 25

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XIIIB, it limits municipal governments' spending, revenue, tax increases, new taxes, and increases in debt almost regardless of the source. Clearly and specifically, by broadly including essentially all government revenue and expenditures, TABOR was intended to "restrain most the growth of government" (Colo. Const. Article X, 1). By contrast, Proposition 13 and Proposition 2 V2 were directed solely and specifically at property taxes with any restraint on the growth of government as an incidental effect. Despite its all-encompassing language and specifically stated intent, TABOR's provisions nevertheless allow Colorado voters the option of approving as much government growth as they might desire. Specifically, TABOR both requires and allows municipal governments to obtain voter approval at biennial general elections for any new tax, tax rate increase, mill levy increase, assessment ratio increase, extension of any expiring tax, or any tax policy change that results in a net tax revenue gain.14 Absent voter approval under TABOR, spending by municipal governments is limited to last year's level plus inflation and a "growth factor" that is the net percentage 14 In Colorado, a simple majority is all that is required. For many increases, California now requires a two-thirds approval. 26

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change in the actual market value of all real property in the municipality's jurisdiction. Additionally, the amendment includes detailed requirements for election and notice procedures should a government seek voter approval. It includes specific provisions requiring that governments reserve three percent of their annual spending for emergencies; prohibiting any new or increased real estate transfer taxes, state real property tax, and local income taxes; and allowing reductions in or termination of business personal property taxes. 15 Finally, TABOR ostensibly allows a municipal government to reduce or terminate its subsidy of any state mandated program. The "loopholes" in TABOR, offering potential evasion or mitigation16 avenues, are its own provisions exempting enterprises from the requirement for voter approval of any increases in revenue or spending, in conjunction with other Colorado statutory provisions allowing the creation and use of 15 This provision is an effort ro empower the legislature co abolish business personal property taxes, despite Article X of the constitution, which says char ''The power ro tax corporations and corporate property, real and personal, shall never be relinquished or suspended." 16 As might be an expected legacy of any closely contested and extensively debated change in the law, individual opinions about TABOR are strongly held and vary. One person's "mitigation" may be another's "evasion." 27

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I enterprises and special district governments for limited and particular purposes. Because TABOR defines enterprises as businesses that receive less than ten percent of their revenue from state and local tax sources and that are authorized to issue their own debt obligations, enterprises and special purpose districts that receive their income from fees are exempt. Typical examples might include special districts providing fee based utility services such as water or sewer or special districts created for essentially time development projects. TABOR is only one part of the Colorado constitution, and it has to interact with the other provisions. In the case of conflicts, the courts must decide what it means and how governments may proceed. As an example, in Submission oflnterrogarories on Senate (1993), the Colorado Supreme Court ruled that state lottery proceeds were not subject to TABOR because a contrary decision would be offensive to the meaning of Amendment 8 in the constitution. 28

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The Gallagher Amendment's Provisions A significant constitutional section with which TABOR interacts is the earlier Gallagher amendment. The provisions of the Gallagher amendment may be even less plainly understandable than those ofTABOR.17 Essentially the amendment reduced rhe assessment ratio18 for residential property from 30 to 21 percent. It also required the legislature to determine the coral, statewide assessed taxable real property value in 1985 and then to ascenain the percentage of this statewide total that was attributable ro residential property. The legislature determined that the percentage was 45 percent. For any year after 1985, rhe Gallagher amendment requires that residential assessment ratios be adjusted so that this 45 percent residential 17 As indicated earlier, the full text of the Gallagher amendment is set out in Appendix A. Because certain documents surrounding the amendment are not readily available, if at all, extracts from some of these additional documents are duplicated in Appendix A, also. In particular, excerpts from a July 16, 1987 memorandum of the Colorado Legislative Council Staff (memorandum number M0714AM/l) aid greatly in understanding the amendment, the intent of its proponents, and the arguments pro and con. 18 The assessment ratio is a percentage multiplied with actual value to equal assessed value. In the next step, assessed value multiplied by the mill levy yields the tax bill. 29

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and 55 percent business proportion will be maintained. Because of the greater growth of residential property relative to the lesser growth of other property in Colorado, Gallagher mandated that the residential assessment ratios that were 30 percent, prior co its adoption, be reduced initially co 21 percent and, then ever lower in the succeeding years: Table 2.1 Residential Assessment Ratios Year Assessment Ratio (%) 1987 18.00 1989 16.00 1989 15.00 1990 15.00 1992 1993 12.86 1994 12.86 1995 10.36 1996 10.36 1997 9.74 1998 9.74 Source: Colorado, 1998, p. 11-2, 11-13 and C.R.S. 1997 -1-104.2. Because these assessment ratios are calculated on a statewide basis, any municipality chat is significantly dependent on the property tax for revenues and is highly residential with little business property might have to raise irs mill levies just to continue ro receive the same dollar amount of property tax revenue each time the residential assessment ratio is adjusted 30

PAGE 49

downward under Gallagher's provisions. And, of course, under the usual interpretation ofT ABOR, these mill levies cannot be raised without voter approval. Absent such approval, a jurisdiction as described would have its revenue automatically ratchet downward if the residential assessment ratio were reduced. Conversely, if the residential assessment ratio were raised pursuant to Gallagher, the local government would have to reduce its mill levy in order to comply with TABOR. Prior to the Gallagher amendment, Colorado assessors were using a 1973 base year from which actual value was extrapolated. In 1982, the Colorado general assembly had already set into a motion the legal and administrative machinery to change to a 1977 base year. After adoption of the amendment, the legislature quickly advanced the base year to 1987. Subsequently, it has been advanced biennially (Colorado, 1989, p. 14,15) 31

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I TABOR and the Courts19 The TABOR amendment contains nine sections, each of which deals with a specific subject matter: Section 1, "General Provisions," says that the amendment will supersede conflicting state constitutional and statutory and local laws. It provides for enforcement litigation, brought either as individual or class actions, with successful plaintiffs to be paid their reasonable attorney fees and costs by the defending (only if they lose) governments. On the iJ other hand, a government (even if it wins) will not be allowed to recover its attorney fees and costs unless the suit against it is determined to be frivolous. This double standard means the courts will have to review attorney fees for reasonableness and determine whether the suits are frivolous. Section 1 also says that should the courts decide that revenues have been collected, kept, or spent in violation ofT ABOR, they muse be refunded with ten percent interest. Finally, Section 1 says that required refunds may be made by any reasonable method, including temporary tax credits or rate reductions. Apparently, any such refunds need not be proportional to an 19 Preparation of this section was greatly aided by the prior work of Grimshaw & Harring, a Denver, Colorado law firm, that has collected, organized, and synopsized most of these cases in "The TABOR Digest." 32

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individual taxpayer's original payments if it is "impractical" to identify or return the prior payments. There have been a number of court decisions and cases involving the ambiguous meanings of Section l. In Zaner v. City of Brighton (1994), the Colorado Court of Appeals20 decided that TABOR should be interpreted consistently with other sections of the constitution. This appears to be a denigration ofT ABOR's stated provision that it should supersede all other constitutional provisions. In another erosion ofT ABOR's "supersede" language, the Court of Appeals ruled that TABOR did not supplant existing case law interpreting the state constitution (Board of County Commissioners, 1994). Additionally, the Zaner court decided that TABOR applied only to issues of government financing, spending and taxation, and not to other issues. It ruled that the General Assembly could enact legislation that implements and resolves ambiguities in TABOR and it ruled 20 The Colorado Court of Appeals is an appellate court one level below the Colorado Supreme Court. Under fairly broad but specified circumstances, its decisions may be appealed to the Supreme Court. The lower level district courts are generally obligated to follow the rulings of the Court of Appeals. County courts are one level lower than district courts. 33

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that the TABOR ballot tide and submission clause could be examined as an aid co discerning the intent of voters who approved TABOR. Other cases have decided that the terms in TABOR should be given "their ordinary and plain meaning" {Bolt v. Arapahoe County School District, 1995)and chat TABOR is a limit on government, not a grant of rights to the people (Bickel v. City of Boulder, 1994, 1995; City of Wheat Ridge v. Cerveny, 1996; and Zaner v. City of Brighton, 1994). The Colorado Supreme Court ruled that the post, TABOR opinions of its author and proponent, Douglas Bruce, would carry no weight in court and that only any "evident contemporary [i.e., pre, TABOR] interpretations" might be relevant for a court's consideration (Submission of Interrogatories, 1993). In another r case, the same court refused to consider Bruce's interpretation ofT ABOR regarding ballot tides on grounds these opinions were beyond the scope of the Court's review (Matter of Proposed Election Reform, 199 3). Finally, the Colorado Supreme Court has decided that its standard of review for whether a government has complied with TABOR will be whether that government has "'substantially complied;" strict scrutiny will not be used (Bickel v City of Boulder, 1994 and Cirv of Aurora v. Acosta, 1995). Any 34

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citizen is allowed to challenge a government's compliance with TABOR, whether or not that citizen has suffered harm
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Community Takeover v. Denver Urban Renewal Authority, (1994). In Bruce v. Hartin (1992), a district court held that the hospital owned by the city of Colorado Springs was an enterprise because Medicare payments were "non-government" funds akin to insurance payments, rather than tax funds. In another case, the Eagle County Board of Commissioners formed a nonprofit corporation and designated it as a county enterprise. Its sole source of income was to be airport "passenger facility charges" (PFCs) that had been authorized by the federal government at the behest of the county. The plaintiffs argued that these PFCs amounted to a grant from the county because by law it had to be the entity to collect them. The Colorado Court of Appeals ruled that "While PFCs may only be 'imposed' by public agencies with the approval of the Federal Aviation Administration, there is no limitation that precludes collection of the fees by a governmental enterprise." Eagle County may have a TABOR-exempt enterprise operate its airport (Board of County Commissioners, County of Eagle v. Fixed Base Operators, Inc., 1997). Section 3ofT ABOR sets out quite detailed and lengthy requirements for election notices, ballot tides, election timing, and other matters related to 36

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the elections that are required under Section 4. This has been a fertile source of litigation with courts specifically ruling that the language is ambiguous at best (Zaner v. Ciry of Brighton, 1994 and Campbell v. Ciry of Arvada, 1994). In a gesture of some small relief to beleaguered city officials trying to cope with the language, the Colorado Supreme Court, in a case involving a tobacco tax amendment, ruled that TABOR does not require every possible effect of a ballot measure to be included within the ballot tide (Matter ofTide, 1994). TABOR's Section 4(a) requires a government to obtain prior voter approval for "any new tax, tax rate increase, mill levy above that for the prior year, valuation for assessment ratio increase for a property class, or extension of an expiring tax, or a tax policy change directly causing a net tax revenue gain to any district." One of the first issues decided in this area was that pre, TABOR elections that authorized unlimited mill levy increases would continue to authorize the increases without another election under TABOR (Bolt v. Arapahoe County School District, 1995). One of the unanswered questions under TABOR is whether a municipality (or other district), experiencing declining property values or 37

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assessment values because of the Gallagher amendment, can raise its mill I levy solely to recoup the lost revenue, without holding an election under I TABOR. The Bolt court may have provided some potential support for such an argument when it ruled that a mill levy to recover lost revenue from the previous year or to recoup property tax abatements or refunds need not be voted on because it is not an increase in tax revenue. The court said "We decline to adopt a rigid interpretation"
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In one of its more conflicting sections, TABOR's Section 9 says that "a local district may reduce or end its subsidy to any program delegated to it by the general assembly for administration." There have been no decisions regarding municipalities in this area, but Mesa County argued that this relieved it of the obligation to provide a courthouse as part of the state's court system. Weld County contended that it should be allowed to stop paying 20 percent of a state-mandated welfare program within the county. The Colorado Supreme Court rejected both arguments, reasoning that a county is a political subdivision of the state and the state cannot subsidize itself {Romer v. Board of County Commissioners of Weld County, 1995 and State of Colorado v. Board of County Commissioners of Mesa County, 1995). As the literature reviewed in the next chapter will suggest, it is not surprising chat much of the litigation surrounding TABOR has involved local government efforts to mitigate its effects, whether by "de-Brucing" elections, creation of enterprises, attempts to shed the cost of state mandated programs, or efforts to recover revenues lost because of the effects ofT ABOR in conjunction with other laws. 39

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What is not addressed by the literature is the extent to which tax opponents will attempt to prevent their fellow citizens from even voting on tax or revenue increases. This is reflected in much of the litigation over the proper wording of ballot tides and other such seemingly trivial detail. The courts have not allowed the contest to degenerate too far into minutia by ruling that substantial compliance will suffice and strict interpretation will not be the rule. Open Legal Issues and Interactions with ocher Laws Despite the volume of litigation thus far, there are still any number of issues suggested by the ambiguity ofT ABOR's language that have not reached the courts. Many of these unresolved issues suggest that, depending upon court decisions, TABOR's operation may be considerably different in the future than it has been to date. For example, section (4) (a) of the amendment requires that "any new tax, tax rate increase, mill levy above that for the prior year, valuation for [the purpose of an] assessment ratio increase for a property class, or extension of an expiring tax, ar a tax policy change direl."tly causing a net tax revenue gain to any district" (emphasis 40

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supplied) has to be approved by the voters. Given the sentence structure and the absence of a comma between "policy change" and "directly causing a net tax," does the lase phrase, "causing a nee tax revenue gain co any district," apply to all of the enumerated items or does it apply only to the immediately antecedent phrase, "tax policy change"? A general rule for interpreting the meaning of constitutions or statutes is that qualifying words, phrases, and clauses are ordinarily deemed to modify only the last antecedent, i.e . the words and phrases immediately preceding. This "last antecedent" rule is not absolutely controlling or inflexible (73 Amjur 2d 230 and 82 C.j.S. ). but it would suggest one outcome under TABOR-that mill levies could not be raised without voter approval even if no net revenue gain resulted. This outcome is suggested, also, by another rule of statutory construction: If there is a comma separating a modifying clause from the clause immediately preceding, the punctuation is an indication that the modifying clause was intended to modify all the preceding clauses and not only the last antecedent (7 3 AmJ ur 2d l). In the TABOR instance, 41

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I there is no comma which implies that the modifying phrase is meant only for the last antecedent. zz But the contrary outcome, i.e., that the modifying phrase is meant to apply to all of the antecedent phrases may be suggested by a decision of the Colorado Supreme Court in Moschetti v. Liquor Lie. Auth. of Ciry of Boulder (1971). This was a case involving whether a proposed liquor store was within a proscribed 500 feet of the University of Colorado campus. At issue was the meaning of a statute section (C.R.S. 1963 ,2,39(5) (c)): The [distance] ... [is] to be computed by direct measurement from the nearest property line of the land used for school purposes to the nearest portion of the building in which liquor is sold, using a route of direct pedestrian access. If the phrase "using a route of direct pedestrian access" modified both "property line" and "building in which liquor is sold," then the store would not have been too dose. On the other hand, if the modifying phrase applied only the last antecedent phrase, "building in which liquor is sold," then the 22 These and other such commonly applied rules of "staturory construction" are discussed plainly and succinctly in William P. Scatsky, (1984), Legislative Analysis and Drafting, 2d ed. St. Paul, MN: West Publishing Co., p. 139,142. One of the classic examples of the importance of punctuation to meaning is "The teacher says the inspector is a fool," or "The teacher, says the inspector, is a fool." 42

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store would have been within 500 feet of the campus. The court ruled that the store could not be issued a liquor license because it was too dose to the campus. In the Moschetti case, the modifying phrase was preceded by a comma, unlike the TABOR paragraph. Despite the statutory construction rules, the Colorado court ruled that the modifying phrase applied only to the last antecedent. Would the result be different with the TABOR amendment that has no comma before the modifying phrase? A reasonable argument might be advanced that since TABOR's avowed purpose is to restrain the growth of government by limiting its revenues, the sentence is more consistent with the rest of the amendment if the modifying phrase is applied to all of the antecedents. If a successful argument could be made that a municipality is allowed to raise its mill levy without voter approval, so long as the new mill levy did not raise the actual revenue of the municipality, then cities and towns could mitigate the synergistic impact of Gallagher and TABOR as the latter continues to require that residential property assessment ratios be adjusted downward. Of course, this argument has not yet been made before the 43

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courts, but it lurks as a possibility. This and other potential arguments suggest that the full meaning ofT ABOR's provisions is still less than certain. Among the other open issues are some that derive from other constitutional and statutory provisions dealing with municipal finances in Colorado. One of the oldest such provisions dates from 1913, when the legislature prohibited all but home rule cities and towns from raising their property tax revenues by more than 5 Vz percent annually without prior voter approval (C.R.S. 1997 Would TABOR's prohibition, without voter approval, of tax policy changes causing a net revenue increase, require the state to obtain voter approval before changing this requirement or would each city and town that wanted to take advantage of any increase in the limit have to obtain prior voter approval? At the time of this writing, the state attorney general has opined that counties with voter approved exemptions from TABOR, still have to abide by the statutory restriction (Colorado, Department of Law, 1998). Another statutory provision with which municipalities must comply prohibits the combination of state, county, and a city or town's sales tax rates 23 The original rare was higher, but in recent years it has been reduced from seven percent to six percent and, then, to the current 5 Vz perc em. 44

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. I : I from exceeding seven percent with only very limited exceptions (C.R.S. 1997 ,2,108). whether some future amendment of this by the legislature would require a TABOR election is undecided by che courts and will remain undecided until, and unless, an amendment attempt is made. 24 Finally, the remaining major constitutional provision limiting municipal financial activity is the prohibition against levying an income tax (Colorado Constitution, Article XX, ,6).25 If the voters were co approve a constitutional amendment removing chis prohibition, would TABOR's language chat it "supersede[s] conflicting state constitutional, state statutory, charter, or other state or local provisions" apply? The same issue arises as between TABOR and Gallagher. The latter amendment requires counties to impose enough of a mill levy increase to repay the state for payments of excess school aid monies when the excess was caused by under,assessments, but TABOR seems to prohibit such an increase. H The ability of municipalities to adopt a sales tax under the Colorado Constitution, Article XX, was discussed and approved by rhe Colorado Supreme Court in Berman v. City and County of Denver, 400 P.2d 434(1965). 25 This prohibition was upheld by the Colorado Supreme Court in City and County of Denver v. Sweet, 329 P.2d 441 (1958). The presently imposed ''occupation tax:" is an outgrowth of this court decision. 45

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Each of these statutory or constitutional provisions illustrates the potential for future litigation, and the somewhat uncertain and, possibly, changing nature ofT ABOR's application. It is clear, also, that Colorado's municipalities operated under a variety of tax and expenditure limitations prior to TABOR's adoption and that TABOR likely did not replace these pre-existing laws. Municipalities in Colorado are now faced with not only the pre-existing limits, but also, the TABOR limits, and the synergistic effects ofT ABOR and these existing limits. The future impact ofT ABOR may well change as the many open issues come before the courts for I definitive resolution. I I I I 46

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CHAPTER3 TWO LITERATURES: GOVERNMENT GROWTH AND TAX AND EXPENDITURE LIMITATION Introduction The first modem theory about government growth has come to be known as "Wagner's Law." In 1877, a German economist, Adolf Wagner, argued that government would grow and consume a larger share of wealth as society became increasingly industrialized, affluent, and populous. Wagner theorized that demand for government services increased faster than did the population's wealth because as society became more populous, it became more complex and the demand for government regulation and intervention increased accordingly (Wagner, 1958). Since Wagner's time, the subject has been no less compelling and theories about government growth have propagated with alacrity. Lewis, Beck and Rice (1985) recount a collection of public opinion polls reflecting American concern with the size of the federal government. In 1938 a Gallup poll asked "Do you think the federal government is 47

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spending too much money, roo little, or about the right amount?" Even during the Great Depression, a majority, 61 percent, answered "too much." These authors critique several of the leading theories about the cause of government growth, including the "fiscal illusion" created by politicians hiding the costs of government through indirect methods. Another favorite is "bureaucratic expansion" with bureaucrats ceaselessly seeking larger budgets (Niskanen, 1971 and Wildavsky, 1964). Later, Wildavsky changed his mind and by 1975 he argued that government growth was inverse to economic growth, i.e., that an expanding economy could contain government's appetite, but a shrinking or stagnant economy would be faced with an increasing government share (Wildavsky, 1975, p. In 1980, he argued for another theory, contending that the body politic, in reality, is a collection of special interests. Each of these comperes for this government program or that, selfishly disregarding any collective assessment that the sum of all these programs is unchecked, uncontrolled government growth (Wildavsky, 1980). Wildavsky was not the first to suggest the interest group theory. Elder (1992) critiqued the theory as it had been earlier expressed, in one form or 48

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another, by Niskanen (1971), Olson (1982), and others. Where others had not offered a solution (assuming that it is a problem), Wildavsky contended that a constitutional amendment would force the citizenry, as a whole, to accomplish what it could not as fragmented interest groups. The original "bureaucratic expansion" theory was postulated by Niskanen (1971). He contended that bureaucrats attempt to maximize their budgets, because it is in their interests to do so, and that the strategies they adopt contribute substantially to government growth. Twenty years after his initial proposal, Niskanen was willing to modify the original theory only to the extent of redefining the budget being maximized. His underlying assumption remained that government continues to grow and that much of the impetus comes from bureaucratic behavior (Niskanen, 1991, p. 1J,J1). Others have argued that various crises cause government growth co rachet upward. In an early study, Peacock and Wiseman (1961) documented ratchets in public expenditure growth in the United Kingdom. Bourne (1964) called war the health of government. Rasler and Thompson (1985, 1989) looked at the relationships between wars and government growth in a number of countries. Higgs (1987) contends that these crisis ratchets are 49

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but one part of a more complicated process of government growth. In a more recent empirical examination of the ratchet theory, Holcombe (1993) used an interrupted time-series analysis with a maximum likelihood estimator (somewhat akin to this study, without the cross,sections) to conclude that real, per capita federal spending ratcheted upward after the Civil War, again after World War I, after the Great Depression, and, again, after World War II. The difficulty with the ratchet theory, and Holcombe's attempt to confirm it, is that the theory postulates permanent increases in government spending that coincide with crisis periods, but does not explain why the J growth did not decline after the crisis was over. I I Walker and Vatter (1997) take issue with Higgs' (1987) contention that economic and political crises have caused government size to rachet upward and with Niskanen's (1971) budget maximizing bureaucrat. Instead, they argue that government growth is essentially driven by failures in the private market. Their position is that when the market produces undesirable outcomes, society demands that government intervene, thereby inevitably causing growth {Vatter & Walker, 1990). Nevertheless, it has been 50

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demonstrated that government spending grows significantly during wars and it is hard to put war at the doorstep of private market failures. The difficulty with theories emphasizing a single cause of government growth is that such a complex phenomenon is almost certainly caused by many variables, particularly when considering government growth at different levels of the United States system. The federal system, itself, has been argued to be a cause of government growth as compared to unitary systems of government (Grossman & West, 1994). Following a wonderfully American penchant for conspiracy theories, Brennan and Buchanan (1980, p. 185) even suggest that separate government units may collude co expand government taxing and spending. Borcherding (1977) attempts to derive formulas chat would I I quantitatively ascribe portions of government growth to a variety of economic factors, including inflation, population growth, rising costs in the face of price inelastic demands for government services, the rising affluence of the population, and increasing societal interdependencies. He places these factors as responsible for about half the increase in government spending (Borcherding, 1977, p. 56). Moving on to political factors, 51

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Borcherding further argues that while he cannot quantitatively delineate the contribution, "fiscal illusion" (the public's perception of taxes is imperfect and subject to gross understatement), the growth and proliferation of special interest groups, and finally the bureaucrat are possible explanations. There is an extensive and growing literature theorizing and attempting to assess empirically theories about the cause of government growth. In 1975, Tarschys (1975) reviewed much of the literature to that date. Among the more prominent perspectives he examined were industrialization, urbanization, demographic changes in the age of the population, technological advance, and market extension (as a society develops more foreign markets, its government may be expected to become involved in the marketing effort and in international cooperative ventures). On a consumer level, Tarschys suggested demands (as people become affluent they demand more government services), a demonstration effect (the media and advertising may create a effect between societies), interest groups, and political strife. Other theories mentioned in Tarschys' review include federalism (many governments 52

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making decisions tends to raise the overall level of government growth), organizational expansion, and the increasing number of bureaucrats who are also voters. One of the more telling indicators of the great size of this literature is the fact that even the many reviews of it have been summarized and reviewed (Larkey, Stolp & Winer, 1981). Most of these theories appear to be concerned with che growth of the national government, and their proponents pay only scant attention to municipal or other local governments. Much of the effon to assess them empirically has used data at the national government level. Nevenheless, without too much imagination, it is possible to suggest that many may have some applicability to municipal governments. For example, if people demand more government services as they become more affluent, this could be tested at the municipal level, as well as at the national or state level. Surely one could test the bureaucrat theory for at least larger municipalities that have bureaucracies. A test of it for some of Colorado's small towns, with only two or three employees, would be more doubtful. Despite these more obvious possibilities, theories specific to municipalities are much more scarce in the literature than those directed at 53

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national governments, but there are a few. For example, Brazer (1959) made a comparison of municipal finances among several cities in the United States and found population density, median family income, and intergovernmental revenue to be the best explanatory variables. Miranda (1993) tests the "strong parry organization" theory of municipal finance with a case study of Chicago's finances after the demise ofMayor Richard}. Daley's political machine. This theory argues that cities governed by strong parry organizations are less responsive to the spending demands of interest groups and, therefore, better able to be fiscally conservative. Miranda found only limited support for the theory in Chicago. Nevertheless, all of the "government growth" literature still may be criticized in the words of Lowery and Berry (1983, p. 688): "The existing literature consists of a large number of very simple and separate models; there has been a steady proliferation of explanations with little or no attention to theoretical integration." Despite voluminous and energetic effort, not much has changed since LewisBeck and Rice (1985, p. 7) observed that "we face many underdeveloped models that are unsubstantiated by empirical research." Musgrave's (1969, p. 124) 54

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observation that the attempts to support empirically or disprove the many theories have proved inconclusive at best seems as trenchant today as it was three decades ago. If so extensive a body of literature has been unable to develop an integrated theory explaining the causes of government growth or to conclusively and convincingly substantiate one or more of them, then it seems rather unlikely that a study confined to Colorado's municipalities is going to accomplish such a monumental task either. This research simply is not going to make any such futile effort and it was not designed to do so. It does, however, examine the assumption that government grows, an assumption common to all of the theories. The study's methodology has controlled for inflation, population growth, and various economic indicators (all within the limits outlined in Chapter l) So it will be possible to argue that the results are net of those factors, but it will not be possible to ascribe any observed growth to one or more of the myriad of other possible causes or theories. This study simply does not seek to determine why municipal spending grows, rather it asks the fundamental question assumed by each of the theories, does it grow? By 55

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I controlling for the effects of inflation, population, and the economy, the question, arguably, can be refined to whether municipal spending grows as the result of the decisions of its officials and citizens, but the reasons for those decisions are not explored here. Assuming for the moment chat municipal spending does grow, the second issue with which this study is concerned is whether TELs such as the Gallagher or TABOR amendments are effective in constraining it. For this issue, the relevant literature is almost as extensive as that concerned with why it grows. Limiting the Growth of Government J usc as many scholars have studied and theorized about the causes of government growth, almost as many have examined efforts co limit its growth. As the first nationally known tax and expenditure limitation, California's Proposition has been studied from almost the day it was proposed.20 (As early examples, see Danziger, 1980; McCaffery & Bowman, 20 Given the time periods included in many of these studies, it appears that the authors were studying the effects and impacts of both Proposition 13 (1978) and Proposition 4 ( 1979), but most have not made any distinction between the two amendments. Actually, most do not even mention Proposition 4. 56

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1978; Oakland. 1979; Peterson & Claxton. 1979; Post, 1979; and Shapiro & Morgan, 1978.) Throughout the 1980s and since, studies of Proposition 13 and subsequent tax and expenditure limitations have continued, and the literature has burgeoned. Despite its extent, this literature may be conveniently categorized and considered along several dimensions. including the state or states that were examined. Thus, much of the literature has focused on Proposition 13 and its effect, or lack thereof, on the tax structure or the relationships between state and local government in California (Chernick & Reschovsky, 1982; Danziger, 1980; Duke & Cohen, 1983; Galles, Long & Sexton, 1995; jeffe &jeffe, 1988a; Jeffe &jeffe, 1988b; Kaufman & Rosen, 1981; Kemp, 1982; Leavitt, 1982; McCaffery & Bowman, 1978; McKinley, 1984; Oakland, 1979; Peterson, 1981; Peterson & Claxton, 1979; Post, 1979; Reid, 1988; Schwadron & Richter, 1984; Sears & Citrin, 1982; Shapiro, 1981; Shapiro &Morgan, 1978; Sherwood,Call, 1987; Vincent, 1984; and Wiseman, 1989). As the second most famous TEL, Massachusetts' Proposition 2V2 has received its share of attention (Bradbury, 1991; Bradbury, Ladd & Christopherson, 1982; Davis, 1983; Hale, 1993; Ladd & Wilson, 1982; Ladd 57

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& Wilson, 1983; Ladd & Wilson, 1985a; Ladd & Wilson, 1985b; Rothenberg & Smoke, 1982; Susskind & Horan, 1983a; and Susskind & Horan, 1983b). Some have studied both California and Massachusetts (Flaherty, 1992). The only other states to have received individual attention in the literature have been Oregon (O'Toole & Stipak, 1998, 1994 and Stipak, O'Toole & Guo, 1993); Michigan (Brokaw, Gale & Merz, 1990 and Courant, Gramlich & Rubinfeld, 1985); Texas (Cope & Grubb, 1982); New Jersey (Megdal, 1986); and Illinois (femple, 1996). Much of the literature has used the state as a unit of analysis and has considered the overall effects ofTELs among the several states which have adopted them in some form or another (see for example, Bails, 1990; Elder, 1992; Howard, 1989; Joyce & Mullins, 1991; Kenyon & Benker. 1984; Mullins &Joyce, 1996; Shadbegian, 1996; and Shadbegian, 1998). Given significant differences among the specific TEL provisions adopted in various states; court interpretations; the status of the stare's economy at the time of adoption; the identity, motivations, and intentions of those promoting adoption; and a host of other economic, demographic, and political variables, it seems problematical that studies of one state or several 58

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I I states could be particularly generalizable to another, specific state. No significant study of Colorado's TELs has been located in the scholarly literature and Colorado's experience may be quite dissimilar to other states. Have TELs Effectively Limited the Growth of Local Government? The focus of many of the studies has been on whether TELs have achieved their purported or incidental intention of limiting the size and growth of state and local governments. Bails (1990) updated his 1982 study by asking (1) whether TELs had actually led to reductions in the growth of state government budgets, (2) whether the enactment ofTELs led to any change in the proportion of personal income devoted to financing state government, and (3) whether state legislatures had actually adhered to the limits required by TELs. By statistically comparing the trends in per capita personal income and per capita state expenditures for the "pre,revolt" years of 1973,77 and the "post,revolt" years of 1977,81, Bails concludes that the TELs had no significant effect. Anticipating the argument that TELs might have resulted in fewer or smaller tax increase proposals, Bails also tested 59

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these proposals in TEL and non TEL states for pre and postrevolt years. Again. he concluded that no significant effect was apparent. Bails' attempt to address the argument about whether any decreased growth resulted directly from TELs or indirectly from changed attitudes brought about by passage of the TEL anticipates the same argument made by Poterba (1995) and Shadbegian (1998) several years later. Kenyon and Benker ( 1984) compared the growth of state government expenditures relative to personal income growth in TEL and non TEL states during the period of 197 7 and found no significant differences. Howard (1989) compared average state revenues and expenditures relative to personal income in TEL and non TEL states from 1979 through 1987 and also found no significant differences. Joyce and Mullins (1991) found that TEL states did experience a short term decline in revenues but a long term increase between 1960 and 1988. 60

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Mullins and Joyce (1996) did a pooled time,series analysis of an extensive set of independent variables27 including the percentage change in real gross state product, ratio of general expenditures to gross state product, population ratios by age groups, etc., and concluded that (1) TELs had little effect on the overall size of the state and local public sector; (2) TELs did not lead to less use of broad based taxes at the state level, but local taxes had been reduced and replaced by more reliance on state aid and user charges; and (3) TELs had forced state governments to assume increasing responsibility for spending in most categories, except welfare. Shadbegian (1996) concluded that TELs significantly increased the elasticity of government size and growth relative to personal income, but, on average, did not limit either the size or growth of state government. For states with below average personal income, he found that TELs did limit government size. In keeping with the purported intention ofTELs to limit the size and growth of state and local government, Shadbegian found that 27 These authors do not very clearly explain which fixed effects model they used, but apparently, it was similar to the one used in this study. They do not indicate the calculation of panel corrected standard errors and it seems likely that they did not use them. If Beck and Katz ( 1995) are correct and these panel corrected standard errors were not used, the significance of the reported results may be overestimated. 61

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they were successful in states with low income growth, but perversely, increased government growth in states with high income growth. In a later study oflocal government budgets, aggregated for each state, Shadbegian (1998) concluded that TELs decreased the level and growth of local government revenues and expenditures, and decreased the level and growth of property taxes. He used a pooled, time,series analysis with dichotomous control variables for time and for each state. Dependent variables, including real "own,source" revenues (total revenues minus intergovernmental revenues), real property tax per capita, and real "own" expenditures per capita, were regressed on population, real personal income, real per capita intergovernmental revenue from the state, and real per capita intergovernmental revenue from the federal government. Although published in 1998, the study did not use any data after 1992. Relying on a 1995 Advisory Commission for Intergovernmental Relations (ACIR) study, Colorado was included in his study as a TEL state on the basis of the property tax limits imposed by the legislature in 1913 (C.R.S. 1997, -1,301), not because of the 1982 Gallagher or the 1992 62

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TABOR amendments. Given this example of inattention to significant fact, some skepticism about the Shadbegian study is inevitable. Nevertheless, he does raise, again, the egg" argument that must be acknowledged. He contends that a state's adoption of TEL law may signal a voter preference for smaller government and it may be this preference, rather than the TEL, itself, that is responsible for any slowed growth or reduced government expenditure. The argument on this point may be colored by his observation that "No imposed local TEL is necessarily binding with respect to local expenditures and revenues" (Shadbegian, 1998, p. ll9). Whether or not this statement applies accurately to the TELs in other states, Colorado's TABOR amendment is surely binding on its municipal governments. None of the TABOR litigation has even questioned the authority of the amendment and given its stature as part of the state's constitution and its mandatory language, such a challenge might daunt even the most intrepid lawyer. Notwithstanding the efforts of Shadbegian and others, given significant differences between Colorado and other states in a wide 63

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assortment of pertinent variables, whether TABOR (or coincidental voter preference) has effectively impacted the growth of any of Colorado's municipalities is a question that cannot be answered without specific study of Colorado's experience. Political Purpose Many of the studies assume that the political purpose ofTELs in general, or any TEL in particular, is to limit the size and growth of state and local government. Having made that assumption, many also surmise (Shadbegian notwithstanding) that voters, nevertheless, did not seek any significant reduction in public services. The logical conclusion is that voters "want to have their cake and eat it, too" or, perhaps put more diplomatically, were expecting increased efficiency in government operations to make continued services compatible with lower revenues. The literature behind these assumptions is generally specific to particular states and the conclusions may not be generalizable to other states (see for example, Brokaw, Gale, & Merz 1990; Courant, Gramlich, & Rubinfeld 1985; Ladd & Wilson 1983; Ladd & Wilson 1985a; and Sears & Citrin 1982). 64

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Several other explanations have been offered for the wave ofTELs since 1978. Neiman and Riposa (1986) suggest that voters are satisfied with j current service, but are hostile to public employees and are generally :I j conservative in their political views. Another proffered explanation is that the electorate is polarized with a large minority favoring smaller government, another large minority favoring increased services (or several minorities supporting several different services), and a group of"swing" voters that might go either way, depending upon perceived fairness, tax burden, or the economy (Hale, 1993). Other explanations suggest that governments are revenue maximizers and will not adhere to spending or taxing restraints that can be evaded legally (Buchanan, 1967, 1991 p. xv); taxes have been increasing while inflation and other factors have been eroding middle-class income (Baskin, 1979); or the tax revolt is largely the result of rapidly increasing property taxes {Mikesell, 1979). In her study of voting patterns for Illinois cities and towns seeking home-rule status, Temple (1996) concluded that communities with large variations in the age of the population were more likely to have voters who would vote for fiscal limitations as a means of protecting 65

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! themselves from large welfare costs for services that they did not want but that were desired by other residents. Government's Reactions and Coping Strategies Again, public choice theorists have contended that government officials are revenue maximizers who will not abide by TELs they can evade (Buchanan, 1967, 1991). This contention, juxtaposed with a presumed voter rationale of limiting government growth by approving TELs, leads to an assumed confrontation between the citizenry and its public officials over directly contrary aspirations. Stipak, O'Toole, and Guo (1993) studied Ballot Measure 5, a 1990 Oregon TEL, that reduced school district property tax rates and directed the stare government to replace any lost revenues. Although rhe TEL's effect remained unclear, either in total or for any specific district, they surveyed all 293 Oregon school superintendents on their perceptions of the anticipated effects. Not surprisingly, 97 percent of those responding expected the TEL to reduce their revenues. Despite a requirement that the stare government replace those revenues, most of the superintendents did not believe the state 66

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would do so entirely, but did believe that the measure would result in more state control over schools and less local control. Perhaps the most interesting finding was that Oregon superintendents, rather than using across,the,board cuts, expected to make much use of such strategies as cutting non,basic services, temporary reductions in expenses, and cutting expenses on the basis of defined goals. In another study, O'Toole and Stipak (1994) surveyed non,school local government officials in Oregon on their views of Ballot Measure 5 shortly after its passage. These managers responded along the same lines as had the school superintendents and most did not really expect to react to the TEL in any way that would fundamentally change the status quo. Three years later, O'Toole and Stipak (1998) surveyed Oregon's local government officials again to determine how experience would compare with anticipation. They concluded that Ballot Measure 5 had changed the fiscal "playing field" for local governments, but that its effects had not been so severe as anticipated. In a theoretical modeling exercise, Toma and Toma (1980) supported the Brennan and Buchanan model of bureaucratic utilicy,maximizing activity 67

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. I in the face of fiscal limitations, but did not attempt to confirm empirically their model. Obviously none of these limited studies of local government perceptions ofTELs and coping strategies has directly addressed the Colorado experience. Again, given major differences in the TEL provisions and the political, economic and legal ecology of each state, experiences from one state to another may be significantly different. Problems from the Literature A myriad of theories have assumed that government revenues and expenditures grow and have ascribed a wide variety of reasons to the presumed growth. Some scholars have tested this assumption with respect to national governments, fewer have tested it for state governments, and fewer still have tested it for municipal governments. No literature has been found that tested the assumption for Colorado's municipal governments with their legal, political, and economic circumstances. Although the TEL literature has addressed a variety of issues and theories, none of it has specifically attempted to test whether Colorado's 68

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municipal governments have grown and whether the Gallagher and TABOR amendments have effectively constrained any such growth. Nor has any directly tested whether government, now fiscally constrained, will either evade the restraint or maximize its own utility by preferring to spend internally for non,functional purposes over functional spending co provide public goods and services. For Colorado, the government growth and TEL literatures raise many more issues than they resolve. The issues for this study are suggested by the fact that the common theoretical assumption is that government, measured by its revenues and expenditures, grows over longer periods of time. The first question this study must answer is whether this assumption is correct for Colorado's municipalities. l. Did real, per capita, total revenues and total expenditures of Colorado's municipal governments increase during the period from 1975 through 1996? The hypothesis is chat there was a positive rate of increase. As suggested by Brennan and Buchanan (1980), constitutional amendments that will survive over many budget cycles are required to limit 69

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effectively government revenue and spending growth. Gallagher and TABOR are such amendments. Somewhat akin to California's Proposition 13 and Massachusetts' Proposition 2 Vz, Gallagher was confined to property tax issues. Unlike Proposition 13 or Proposition 2 'lz, Colorado's TABOR amendment mandates a limit on essentially all municipal revenues and expenditures. The next question for this study derives from the unique research opportunity presented by the adoption of Gallagher and TABOR, and the Brennan and Buchanan (1980) implication that a constitutional amendment such as TABOR will effectively constrain the growth of government revenues and expenditures: 2. Ocher things being equal, such as inflation, population growth, and economic influences, was there a change in the rare of growth in municipal revenues and expenditures after the adoption of the Gallagher amendment and, again after the TABOR amendment? The hypothesis is that the rare of growth in real, per capita terms was highest during the period from 1975 through 1984, decreased from 1985 through 1992, and decreased further after 1992. 70

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Some of the literature has gone beyond the issue of whether TELs effectively constrain government growth and looked at how governments have responded co newly adopted TELs. For example, Brennan and Buchanan (1980, p. 136,144) and ochers (Hale, 1993; Bails, 1982; Mullins & Joyce, 1996; and Shadbegian, 1998) have followed Niskanen's (1971) lead and suggested that government officials will evade TEL restraints where possible. TABOR offers several possible avenues for such evasion:28 the exemption for "enterprise" revenue and expenditures, partial exemptions for nontax revenues, and exemption elections. Thus the next questions ask: 3. Again, ceteris paribus, was there a change in the rate of growth, in real, per capita for different revenue accounts after adoption of each of the TEL amendments? Is there a difference in the rates of growth for municipalities that have had successful exemption elections and those that have not had such elections? The hypothesis is that certain nontax revenue accounts will show an increase in this rate of growth 28 Use of the word "evasion" is not meant to imply chicanery. Whether the result is entirely satisfactory to the citizenry or not is outside the scope of this study and may well be "in the eyes of the beholder" absent some legal sanction on it. 71

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and that municipalities with successful exemption elections will have higher rates of increase in revenues. As suggested by the literature that contends public officials will prefer to spend newly constrained resources more for their own benefit and less for public benefit, and following Shadbegian's (1998, p. 133) suggestion, this study examines the issue by looking for changes in the patterns of spending in different, standard municipal accounts. 4. Was there a change in the growth of real, per capita spending after the TELs? The hypothesis is that some expenditure accounts, such as general government, will have rates of increase higher than other accounts, such as law enforcement, fire protection, and recreation. Although TABOR mandates limits on all revenues, it clearly emphasizes the property tax by defining the growth limit for municipalities in terms of property value. Both Propositions l3 and 2 Vz suggest that much of the voter concern in the history of the movement toward TELs has been about the property tax. Shadbegian (1998) discerned a decrease in the growth oflocal government property taxes in those states that had TELs. 72

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Mullins and joyce (1996) discovered an increased local government reliance on state aid and user charges after TEL restraints were adopted. Thus this study looks at changes in the patterns of real, per capita growth for various standard municipal revenue accounts. 5. Holding economic influences constant, was there a change in the real, per capita growth trends for sales tax, property tax, sales tax, charges for services, permits and fees, and fines and forfeitures after TABOR became effective? The hypothesis is that there would be a decrease in the growth rate for property tax revenues, and an increase for the other revenue accounts. At the outset, this study was described as being about two issues-the growth of government and citizen efforts to constrain it. It is still about these two issues, but the interplay between them is not confined to one inning in which government grows and is constrained. Rather, the contest proceeds through many innings of growth, constraint, government response, citizen reaction, and so on. It is the extended contest that this study explores and it does so by methods that essentially exami'le long-term patterns, trends, and interventions in those trends. 73

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One of the more persistent Colorado public sector responses to TABOR has been the expressed opinion that TABOR's effects have not been too drastic, as yet, because the economy has been "booming." This is almost always followed by the question: what will happen when the economy turns downward? Sales and property tax revenues are imponant components of total municipal revenues Although California has gone through economic flucutuations since Propositions 13 and 4 were adopted in the late 1970s, the literature examining that state's experience has not attempted to control for economic conditions beyond inflation and, therefore, provides no useful suggestion as to what might be expected from Colorado's experience. However, because revenues from these taxes are directly related to fluctuations in retail sales and property values, the expectation is that contractions in the economy sufficient to lower propercy values or retail sales would result in reduced municipal revenues. 6. Are the real, per capita growth rates for municipal revenues and expenditures dependent upon fluctuations of economic conditions? The hypothesis is that municipal revenue growth 74

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trends will be significantly affected by fluctuations in the economy. The burden of the next chapter is to "set the stage" for an examination of this issue by describing the economic conditions within which Gallagher and TABOR, thus far, have operated. Afterward, the study attempts to control for these economic effects as it examines the trends in revenue and spending that preceded and followed the adoption of these two TEL amendments. 75

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CHAPTER4 THE COLORADO ECONOMY, 1975-96 Even located in a pan of the United States sometimes described as America's "empty quaner" (Ganeau, 1981), Coloradds economy is not isolated from the nation. lr is sometimes counter-cyclical to the national economy. Ir is often subjected to deeper, longer lows and loftier, shorter highs than the national economy, but it is never beyond the influence exerted by national economic policies and conditions. As much as the state's economy is swayed by the national economy, it is shaped by geography. Located in the western United States, Colorado is one of the "those rectangular states," about 370 miles across from east to west and 280 miles from north to south. It is the eighth largest scare in area and encompasses about 104,000 square miles (Brunner, 1997, p. 756). In 1990, this space was occupied by almost 3.3 million people (Brunner, 1997, p. 827). The combination of great space and not so many people, meant that the state was ranked 26th in population density with about 32 people per square mile. Of 76

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the states east of the Mississippi River, only Maine, with 40 people per square mile, is close to being as sparsely populated (Brunner, 1997, p. 82 7). The eastern half of the state is mostly vast high plains grasslands with large cattle ranches and grain farms in the uplands and irrigated row,crop farms in the South Platte and Arkansas river valleys. The central and southwestern parts of the state are dominated by various ranges of the Rocky Mountains with 54 peaks reaching heights of more than 14,000 feet. The western and northwestern parts of the state are characterized by federally owned land, large sheep ranches, oil and gas fields, and rugged terrain covered with sagebrush, scrub oak, and short prairie grass. The principal urban area is a centrally located norrh,south corridor along the eastern edge, or Front Range, of the Rocky Mountains with the cities of Fort Collins on the north and Pueblo on the south. The capital city of Denver is slightly northeast of the center of the state in this Front Range corridor. During the two decades considered by this srudy, 1975 through 1996, the national economy experienced a number of business cycle expansions and recessions (U. S. Department of Commerce, 1994, Table C,51). These 77

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expansions and contractions of the economy are reflected in the nation's gross domestic product (GDP) :29 Figure 4.1 U.S. Gross Domestic Product (GOP) (Real}, 1975-96 7,500 7,000 6,500 iD j 6,000 5,500 .,. N 5,000 ..... j 4,500 0 4,000 3,500 3,000 L I I I I i -Real GOP : / ! I I I I i i AI I i i I i I : I I I ; I I I I I I A I : ; i I I I I I I i : I : ' I I I I _, : I ; I / i I I i i I I I I I I i I I i i i I I i I I ! l I I i I ' I ! I I i I i ! I I I I I I I l I I i l i i I I I i I I t ; I I I : I I j I ! i i i I i I I I I I I : I I I Source : U S. Department of Commerce, Survey of Current BUSiness 29 Recessions are formally defined by gross national product (GNP) rather than by the gross domestic product (GOP). The difference between the two is that the GNP includes U.S. earnings abroad and the GOP does not; the latter includes earnings of foreign corporations with operations in the U.S., and the former does not. Since this study is concerned with the domestic economy, it uses the GOP as a reflection of the national economy. 78

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In the early 1970s, before the period of this study, the national economy began a slide into recession that did not reach bottom until March, 1975. During the period, inflation and unemployment were high with both over eight percent. For the first time in more than ten years Colorado suffered a decline in the number of workers employed, but a gradual improvement was forecast for 1976 and beyond (Universiry of Colorado, 1975, p. 4). After the recessionary bottom in 1975, the national economy began a recovery until january, 1980, and Colorado participated. Despite the expansion, it was a troublesome economic period. The national unemployment rate declined, but never fell below 5.8 percent and by 1980 was at 7.1 percent (U. S. President, 1998, Table B--42). Inflation rose rapidly to an annual rate of 13.5 percent in 1980 (U.S. Bureau of Labor Statistics, 1998). Interest rates followed inflation to reach historic highs: 79

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Figure 4.2 U.S. Treasury Bill (90-day) Interest Rates, 1975-96 16.(XX> 14.00) 1200) E 10.00l c( .._ !. aOOl c Q) e 6. Q) 4.00) 2 O.OOl 10 co ..... co en 0 ...... N (") It) ..... co en 0 ...... (") 10 ..... ..... ..... ..... ..... co co co co co co co co en en en en en Q) en en en en en en en en en en en en en en en en en en en en ...... ...... .... ...... ...... ...... ..-..-...... .... ...... ...... .... .... ...... .... .... .... .... ...... ..-..-Scuce: Eax IOITic Report a the Presidert, 1998. Table Although the real GOP grew during the period, the rate of growth continued m slip, until1980 when it actually shrank by 0.3 percent from the prior year (U. S. President, 1998, Table B-4). The 1980 decline lasted only six months, until July, after which the economy expanded until July, 1981. The next contraction lasted until November, 1982. The expansion that 80

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followed became one of the longest economic expansions in the nation's history.30 Growth was long and steady until July, 1990. During the decade, the federal budget deficit was a continuing problem, but the GOP enjoyed positive growth except during 1982. Inflation slipped from its high of 13.5 percent in 1980 to 1.9 percent in 1986 and rose only slightly by 1990. Overall, the unemployment rate shrank from more than nine percent in 1982-83 to a low of 5.3 percent in 1989. Despite the generally good news, business failures rose rapidly during the early 1980s, from a low of 40 per ten thousand. By 1986 the rate was 120, bur it had declined to 65 by the end of 1989 (U. S. President, 1998, Table B-96). During the latter half of the 1980s, Colorado's experience was drastically contrary to the national experience. During the late 1970s and early 80s, Colorado experienced the latest of its natural resource "boom" economic periods.31 The Arab oil embargo and OPEC (Organization of 30 Apparently to be exceeded by the eight-year expansion still continuing at the end of 1998. 31 The gold rush of 1858-59 ("Pikes Peak or Bust") and the silver boom of the 1890s (recall Horace and Baby Doe Tabor) were short lived and were followed by a "bust" state economy. Oil exploration companies and entrepreneurs of the 1970s and 80s were only the latest in a line of risk takers to seek their fortune from the state's natural resources. 81

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Petroleum Exporting Countries) price fixing of the 1970s may have been a curse for most of the nation, hut for Colorado and a few other oil,producing states, it was a blessing and an opportunity for immense wealth. Oil wells 1 that made no sense at less than $20 per barrel, suddenly looked golden at $35 or more. The bubble began to quiver in 1981 when OPEC's pricing structure collapsed and, finally burst in December, 1985 when OPEC's members boosted production to glut levels (U.S. Department ofEnergy, 1998): Figure 4.3 U. S. Domestic Crude Oil First Purchase Real Price, 1975,96 60 50 8 ii 40 ---! J 30 Gi a.. I! .!1 20 0 0 j a:: 10 0 It) :e ,.._ ,.._ ,.._ 0) 0) en ,.. ,.. ,.. Source: U.S. Department of Energy, Energy Information Administration 82

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As prices for domestic crude oil fell from $30 per barrel in 1985 to half that in 1986, exploration companies could not retrench and abandon Colorado fast enough. For the nation, exploration drilling fell from 313.06 million feet of wells in 1985 to 181.51 million feet the next year. The effect reverberated throughout the state's economy. The state's economic downturn during the late 1980s is reflected by its falling retail sales in 1985 and 1986: Figure 4.4 Colorado Average. Real, Per-Capita Retail Sales. 1974-95 5600 5400 5200 8 5000 ii ., ,... C 4800 ....... _,. c 4600 c:: 0 0 4400 4200 So11ce: Colorado Department of Local Affairs, CEDIS Database 83

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Performing somewhat better chan retail sales, the state's gross produce lost ground in 1985, remained flat in 1986, and in 1987 managed only co gee back co 1984's level: Figure 4.5 Colorado Real State Gross Product. 1977-96 110,CXXJ +------------------------------------------------1 Sor..n:e: U S. Department of Commerce. Bureau of Economic Analysis A good indication of the counter-cyclical behavior of Colorado's economy during the period is shown by a comparison of the national and Colorado unemployment rates. Colorado's rate began ro rise in 1985 while 84

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the national rate was continuing to decline. Then in 1989, the national rate started to climb upward as the state's rate continued its decline. Figure 4.6 Comparison of U.S. and Colorado Civilian Annual Unemplovment Rates, 12.0 10. 0 1 -u s unemoiOyment Rate 8 0 4 0 2 0 0.0 I --Colo Unemployment Rate I I le co co Si -i i i I !i I ; i m ii ...... ,.._ s 0) en en 0) ----.,... .... .... .... .... .... --Source : U.S Bureau of Labor Statistics and Colorado Department of Local Alfaira, CEDIS Database -i I .... .... The impact of this economic misfortune on the state's population is apparent from net migration during the period. Unable to find jobs, many people had to give up and move elsewhere. From 1985 through 1989, more people moved out of Colorado than moved into the state. 85

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Figure 4.7 Colorado Net Migration, 80,000 70,000 60,000 50,000 40,000 i 30,000 20,000 Q. 10 000 0 -10 ,000 -20,000 -30 ,000 /[\ L i i !VI I j l' ,.... J i I l i I I v 1\ l I ! A i I \ j : I I I I I v I I I l t\ I i I I I I I : I I i i I j I I I i I I i I I I I I i I I : I I I I I I I I L I I : i i i I i I I I I I I j i I i I i i I ......,... i I i I i I i I : I I i I Sotlce: Colorado Department of l.oc:al Affairs The ebb and flow of these population gains is reflected in the population trends experienced by Colorado municipalities: 86

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Figure4.8 Colorado Municipal Population (estimated), 1975,1996 2,800,000 2,700,000 2,600,000 2,500,000 2,200,000 2,100,000 2,000,000 1,900,000 ./! 0 i l I l i I A I I I i I i l I I : I i I I ; I 1 i I I I I I I i I I I i : I i i I i i I Sou'oe: Cdorado, Department d Local Affairs, CEDIS Datatese I I I I I I I I I I I I I ; /( / : I I ./1 I i I ! I I i I I I I i i I I I I I I i i : I I I I i i I I j ; I : I : The 1990s began with a short national business cycle contraction, but since March, 1991, the economy has been expanding and this time Colorado has fully participated. Since 1990, gross product, retail sales, and other indicators have been rising, nationally and in Colorado. After several 87

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years of virtually no growth, in 1990, the state's municipal population began steadily increasing and, through 1998, still showed no signs of slowing. Despite the growth, Colorado's economy did not begin to recover significantly from its doldrums until1991. As is often the case with the national economy, construction activity lead the way. For the state, real, per capita construction earnings reflect an important segment of the economy: Figure 4.9 Colorado Mean Annual. Real. Per Capita, Construction Earnings, 1974-95 8 ii Si -Source: Colorado Department of Local Atrairs. CEDIS 88

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Coincidentally, shortly after the state's economy came out of its malaise and began to grow strongly, the voters approved the TABOR amendment in 1992.32 With this fortuitous timing, Colorado's municipalities were able to implement and gain experience with the amendment during a period of economic strength. Nevertheless, despite several years of strong economic growth, memories of the "bust" linger and there are still pessimists (or realists, depending on individual predilection) who think that Colorado may again experience lean economic times. Hence, one of the enduring worries of municipal governments has been that when the economy makes its next downturn, TABOR's growth limits will require cutbacks that are now unimaginable. The theories that a true measure of government growth can be achieved only by removing economic influences find their practical expression in this concern of municipal governments. Thus, in addition to the theoretical reasons for considering economic influences, there are practical reasons. The methods this study uses to address these concerns and to answer the question-what 32 The literature exploring why voters approve TEL limitations is abundant with theory and somewhat limited (see Chapter 3) on evidence. With the exception of Smith's ( 1996) offer of a "faux populism" explanation, none of it has addressed the issue in Colorado. 89

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effect has TABOR had on municipal finances, exclusive of economic influences-are the subject of the next chapter. 90

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CHAPTERS A STUDY OF MUNICIPAL FINANCES Government growth is inherently a process occurring over time and measurement of it requires a series of observations over an extended time. The resulting time-series analysis examines patterns or trends in growth and is essentially a search for changes, interventions, or interruptions in those trends. This interrupted time-series analysis technique is particularly useful for examining new policies designed to change behavior (Meier & Brudney, 1993, p. 375 and McDonald, et al., 1980, p. 6). The complicating factor for this study is that it seeks to examine these trends for an aggregate of 255 municipalities, instead of only one. This requires a cross-sectional analysis combined with interrupted time-series. The result is a pooled, time-series 91

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analysis, 33 as used in this research. This chapter discusses the subjects of the study, the data, and the analytical procedure. The Subjects This study examines Colorado's legally incorporated municipalities. The limitation to "legally incorporated municipalities" excludes any number of informal communities that appear as points on maps and are recognized as communities. Many have post offices and volunteer community associations, but they are not legally incorporated municipalities and, therefore, do not have officially recognized governments. Appendix D is a listing of all 2 72 incorporated municipalities, indicating the county in which each is principally located and its estimated population for each year from 1975 through 1996. In number, Colorado's municipalities are overwhelmingly 33 Sayrs (1989, note 1, page 73) contends that "pooled time series" should be distinguished from "panel." She argues chat panel designs are cross-sectional observations at various points in time that are not necessarily contiguous in time. Finkel (1995, note l, page 90) contends that the distinction is only informal with pooled time series "typically viewed as having a larger number of time points relative to units chan do panels." Although this study does not fit Finkel's definition, it does fit Sayrs'. Since the data in this study is contiguous in time, the convention of using "pooled" as the descriptor will be followed. "Pooled" seems to be the predominant usage. 92

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small towns. Six Front Range cities hold more chan half the municipal population of the state and if the smaller suburban towns and cities in the Denver metropolitan area are included, the Front Range corridor accounts for more than 80 percent of Colorado's municipal population. Aside from those along the Front Range, most of Colorado's towns, if transplanted to the eastern United States, would pass for rural wide spots in the road; many do not even have a traffic light. Colorado's largest municipality is Denver with a 1996 population estimated to be 497,007, and the smallest are Keota and Rosedale,34 thought to have no population in 1996.35 34 Keota is located in a remote, rural areas of northern Weld county It still can be found on most maps of the state and is located on County Road 390 {a gravel road) just north of Colorado Highway 14 between Briggsdale and Raymer. Rosedale is thought to have been located in Weld county in the general vicinity of Greeley. It is not on most maps and its exact location was nor discovered. 35 In perhaps a comment on the durability and longevity of governments, Colorado's statutes allow for petitions by 25 percent of a municipality's voters to discontinue incorporation {C.R.S. 1997 -3-101) or a detennination of abandonment by the Secretary of State, after initiation by the county attorney or any town landowner {C.R.S. 1997 -3-301), but this must follow five years of inactive town government. There is no provision for any automatic dissolution. If the lase citizens leave without turning off the lights, they may burn for a long time. The lase two residents of Keoca probably left in 1990 or 1991, but i c is still an incorporated municipality. As of April, 1999, the town had been repopulated by a Weld county snowplow operator and his family {including large, friendly dog) living in a mobile home. They were unaware char the town was still legally incorporated. 93

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Table 5.1 Number of Colorado Municipalities bv Population Groups %of %of Total No. in Population Group No. in Group Total No. Municipal Pop. Study 0-1,999 182 67 4.5 168 2,000-4,999 37 14 4.3 35 5,000-9,999 20 7 5.2 20 10,000-49,999 21 8 16.5 20 50,000-99,999 6 2 17.4 6 1 00,000-plus 6 2 52.0 6 Source: Colorado Department of Local Affairs, Division of Local Government, CEDIS Database. Note: Percentage of Total Municipal Population does not add to 100 percent because of rounding. The Data The data used are the revenues and expenditures of the 255 municipalities studied, as well as certain economic and population data. Annual financial and population data were collected for each municipality for calendar years 1975 through 1996. Because they were lagged by one year in the analysis (to account for the lag in municipal budget cycles), economic data was collected for calendar years 1974 through 1995. 94

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I I All analyzed data were extracted from the Colorado Economic and Demographic Information System (CEDIS), a database maintained by the Division of Local Government, as part of its legislatively mandated activities. 30 Colorado's municipalities nominally file annual financial reports, in a uniform format, with the Division. The data from these reports are 1 entered into the CEDIS database. The database reports an entry for each of I the 2 72 cities and towns for each year in each revenue or expenditure category. Depending upon the city or town, the year, and the category, some of the entries are zeroes. It seems apparent, or at least plausible, the many of these zeroes are not actually reported zeroes, but, instead, are missing data occasioned by a municipality's failure to report the information despite the filing requirement. A few were incorporated only very recently. A few have had a functioning town government only sporadically. As explained in Chapter l and detailed in Appendix E, seventeen of the 2 72 municipalities were 30 The financial data was extracted on November 1 and 2, 1997 and on April 10 and 12, 1998. The economic and population data was extracted on December 12, 1997 and on January 14, April12, April21, and December 23, 1998. 95

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I I excluded from the study because at least six years of data observations in all the revenue and expenditure variables were represented as zeroes. Many municipalities do not spend in some categories; for example. they do not have fire departments, or they do not impose some taxes, such as a sales tax. For these, the reported zeroes most likely represent an actual lack of revenue or expenditure and should be considered as actual zeros. For this study, there was no practical way to investigate each municipality for more than twenty years of information as to which of these zero entries represent actual lack of revenue or expenditure and which simply represent missing data. In some instances, a plausible guess could be made, but in others there is no reasonably certain way to know or guess. The issue of whether these zero entries should be left as zeroes or treated as blank or "no data" entries becomes important to the choice of mathematical models for the analysis. The "no data" method limits the choice of analytic models to a few that can accommodate missing observations in a time-series, but are not very powerful. The remaining option is to use zeroes, instead of"no data." This tends to understate reality (it pulls either negative or positive values closer to zero or it may exaggerate 96

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rates of growth) and increases error variance, 37 but it does allow the consideration of a wider variety of analytic models. The decision was made to use zeroes because (1) most of the observations probably are actual zeroes rather than simply missing data, (2) there is no certain way, that is practically available, to distinguish between "actual zeroes" and "missing data zeroes," and (3) more appropriate and powerful analytic models are available if there are no missing observations in the time-series. A more complete explanation of the consequences of choosing to use the reported zeroes rather than attempting to eliminate them as missing data is set out in Appendix E. The financial data consists of each municipality's annual total in eleven revenue and fourteen expenditure categories. A listing of these categories, their relationship to each other, and a description of the data they include is contained in Appendix C. Although CEDIS allows some of the data to be extracted in an inflation adjusted, per-capita form, for this study it 37 As the error variance increases, calculated R-square values get lower. Hence, these values, in this study, are lower for many regressions, than might be expected of time-series regressions generally. 97

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was initially retrieved in its actual dollar form so that control could be maintained over the adjustments performed. The first adjustment was to convert the information from actual, current, or nominal dollars to inflation-adjusted or real dollars. For this purpose, the Denver-Boulder Consumer Price Index (CPI), as prepared by the U.S. Bureau of Labor Statistics, was used. Beck (1976) argues that inflation for government spending (mostly services) does not precisely follow consumer prices. Another argument is that the existing CPI does not very accurately measure inflation. Whatever the merits of these arguments, resolution of them is beyond the scope of this study. Another unresolved drawback of the Denver-Boulder CPI is the suspicion that inflation in many rural and distant parts of Colorado almost certainly does not uniformly coincide with that of the Denver-Boulder metropolitan area. Nevertheless, this index was selected because TABOR specifies it as the legal definition of inflation, because it is the only readily available inflation index specific to at least some of Colorado, and because most of Colorado's municipal population does lie within the counties for which the index is specifically applicable. 98

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Using the CPI to convert nominal dollars to real dollars requires the choice of some base year for which a dollar would be deemed equal to 100 cents. In this instance, the obvious choices were 1975, because it is the first year of this study; 1996, because it is the last year; and 1982, because that has been a commonly used base year. Although the choice of base year is ultimately immaterial since all the analyses and results of this study are portrayed in rates of growth and percentages of change, the first year, 1975, was chosen. The magnitude of this inflation adjustment and a comparison of the Denver,Boulder inflation rate to all cities in the United States is contained in Appendix F. The next adjustment of the data was conversion to per,capita dollars. The only actual census counts for Colorado municipalities available for the period of the study are the 1970, 1980, and 1990 U.S. decennial censuses. Accordingly, this study uses annual 0 uly 1) estimates of municipal populations prepared by the Colorado Division of Local Government. These are listed in Appendix D for all municipalities. The Department prepares these annual population estimates based on a cohort,component model (Colorado, 1995b, p. 10/10). As the name implies, the method projects each 99

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component of population change-births, deaths, and migration-separately, while maintaining the age and sex cohorts in the population. The second rype of data used in the study are economic indicacorsunemployment rates, retail sales, personal income, construction earnings, manufacturing earnings, and farm income. These are used to introduce a control for economic conditions into the analytic model. Various government growth theories have argued that the economy is a cause of government growth. Borcherding (1977) even suggests that he can identify it as causing about half the growth. This study seeks to understand whether the Gallagher and TABOR amendments restrained government growth. If any such understanding is co be reached, the analysis must attempt to control for economic influences. In the case of Colorado and the TABOR amendment, this seems particularly pertinent because TABOR, thus far, has been the law only in an optimistic, high tide state economy. The "conventional wisdom" among those concerned with municipal finances and budgeting is that the economy's strength may have masked some of the impacts of the amendment. lOO

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Another argument has been that government is not really growing unless it is doing so relative to individual prosperity and economic confidence (Kenyon & Benker, 1984; Howard, 1989; Mullins &Joyce, 1996; and Shadbegian, 1996). If this argument is to be accounted for, also, the analysis must control for the economy. The analytic model used in this study controls for economic fluctuations and effects by adopting a multiple indicator approach akin to that often used to forecast economic conditions. In this instance, there is no attempt to forecast, so the indicators have been selected to reflect coincident conditions. After selecting indicators of economic conditions, the study lags all of them by one year to account for the annual lag in municipal budget cycles. Thus the economic data used in the analysis was collected for 1974 through 1995, while the financial data was from 1975 through 1996. In addition to the theory that government grows in the perception of its citizens only as it grows in relation to their personal prosperity, several researchers studying the effectiveness ofTELs and the growth of government have used personal income as an independent variable in their analysis (see for example, Temple, 1996; Elder, 1992; Shadbegian, 1996; Galles et al., 101

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1995; and Mullins &Joyce, 1996). For these reasons, and as pan of the control for economic conditions, this study uses real, per#capita personal income as an independent variable. Following Elder ( 1992), the annual average unemployment rate is also used as an independent variable. A third economic indicator used in the model is retail sales. Although none of the literature reviewed mentions retail sales as a factor in government growth, it is included in this study because retail sales are a primary indicator of economic conditions and because sales tax revenues, based on retail sales, are a significant source of municipal revenue in Colorado. Building permits are a commonly used leading economic indicator valuable in forecasting economic conditions (Colorado, 1997). Nevertheless, building permits are not a perfect indicamr of construction activity If market conditions change, builders can and do rerum permits and cancel work before it begins. Since this study seeks m portray current economic conditions, construction earnings were deemed a more accurate indicamr of this important segment of the economy. 102

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Forecasters, also, look co such leading indicators as factory orders or inventory levels co gauge future economic activity in the manufacturing sector. Mullins and joyce (1996) use a manufacturing employment ratio as an economic variable in a model similar to the one employed in chis study. In a study such as manufacturing earnings were deemed a better indicacor of present activity in this segment. The final economic factor used is farm income. Various indications of the farm economy are frequently used in forecasting economic conditions. In chis instance, farm income was included because so many of Colorado's municipalities are small towns in the rural, farming areas of the state. Indicators such as manufacturing, construction, and unemployment are much more indicative of urban economic conditions chan they are of rural conditions. Farm income has been included to provide some representation of the importance of it to Colorado's many small rural towns. The economic data used were available only at the county level and are not specific co particular municipalities within a county. The single exception is the city of Denver, which is coextensive with Denver County. Nevertheless, there are ocher instances in which the county data, for all 103

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practical purposes, most probably would be the same as data for a particular municipality. For example, Lake City is the only town in Hinsdale County. 1 The town had a 1996 population of 343 and the county had a population of I I 700. Except for Lake City, the county is overwhelmingly uninhabited, I mountainous national forest. There are several counties that have only one or two small towns with the remainder of the county being sparsely populated. As an example, Cheyenne County had a 1996 population o,367. Its two towns, Cheyenne Wells and Kit Carson, had a combined population of 1,419. The remaining 948 people live in a county that encompasses about 1,890 square miles. As another example, Moffat County had a 1996 population of 12,133, including 9,04 7 in the municipalities of Craig and Dinosaur. The remaining 3,086 people live in a county of about 4,890 square miles. For some perspective, this is an area slightly larger than the state of Connecticut. A quarter of Colorado's 63 counties include only one or two municipalities: Denver, Hinsdale, Jackson, Bent, Lake, Mineral, San Juan, Archuleta, Cheyenne, Costilla, Custer, Dolores, Gilpin, Huerfano, Ouray, Park, and Washington. 104

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I Despite the fact that many of Colorado's counties have no significant economy outside their municipalities, because there are not many people or opportunities for transactions outside the towns, it cannot be argued that county-wide economic data are perfectly reflective of municipalities within the county. There may well be some difference, but this study did not attempt to discern it. It is assumed that the county-wide economic data are sufficiently valid regarding municipal economies for these purposes. Finally, the economic indicator data were converted to natural logarithms as an aid to reducing the autoregressive characteristics of the data when stacked in a pooled time-series and so that the coefficients can be read, directly (multiplied by 100), as percentages of change related to other percentages of change. For example, with this transformation of the data into a "log-log" format, the results can be interpreted as a percentage of change in the dependent variable for every one percent change in an independent variable. In a semi-log model, the results would have to be read as a percentage change for each unit (usually $1) of the independent variable. 105

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The Analytic Model All of the data described have been analyzed using a model best described as a specialized multi variate regression model. Specifically, it is a pooled, time-series, fixed effects analysis as described by Sayrs ( 1989), Greene (1997), Kmenta (1986), Johnson (1995), and judge, et al., (1988). The model can be portrayed by Equation 5.1 where i = 1, 2, ... N cross-sectional observations. There are 255 of these cross-sections-one for each municipality studied. There are 22 time observations for each municipality. Thus, t = 1, 2, ... T time-series observations for 197 5 through 1996. The slope represents the coefficients common to all municipalities, Yir. is the dependent variable, and the x/cU are the explanatory variables, including economic, trend, and the Gallagher and TABOR interventions. The eit are independent and identically distributed random errors. 106

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It must be emphasized that the model does not include a constant term. This is necessary to avoid the "dummy variable trap" or perfect collinearity (Hardy, 1993, p. 7 -9). An alternative would be to include a constant term and exclude one of the dummy variables for a municipality. The advantage of the first method is that the fixed effects of all the studied municipalities are included. The advantage of the second method is that it would allow comparisons of coefficients ro the constant. In this instance, it was decided to not use the constant because comparison to it has no meaning in the context of this study. The Djt are dummy variables and take values equal to zero or one. There is a dummy variable corresponding ro each individual municipality. Each dummy variable takes a value of one for observations contributed by the corresponding to municipality j, but will be zero for observations that belong to the other municipalities. These dummy variables provide the fixed effects part of the model because they control for the specific effects of each municipality; effects that are subsumed into the dependent revenue and expenditure variable data. 107

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The "time,series" part of the description derives from observing each municipality annually for the 22 years in the study. The "pooled" descriptor develops from stacking the individual time series for each municipality with the series for each of the other municipalities. The result is 22 observations per municipality multiplied by 255 municipalities for a total of 5,610 observations for each variable in the full model. The model is also an "interrupted" time,series because additional control variables are included to detect any change in the overall trend that I I 1 is coincidental with the specified intervention in the trend of either the I Gallagher amendment or the TABOR amendment. An overall trend control variable is coded one for 1975, two for 1976, and so on through 22 for 1996. The intervention or program control variable for the TABOR amendment is coded zero for each year of the study period prior to TABOR's implementation (1975,1992). This variable is coded one, two, three, and four to corresponded with 1993, 1994, 1995, and 1996; the years TABOR has been in effect. The corresponding program control variable for the Gallagher amendment is coded zero for 1975 through 1984 and, then 1, 2, 3, ... 12 for the years 1985 through 1996. Meier and Brudney (1993, p. 375, 108

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I I 389) describe several examples of the usefulness of these program variables and their coding for detecting the long, term effects of program changes. 38 Finally, the model may be described as a fixed effects or covariance model because it controls for the effects of each municipality. This is in contrast to a random effects or error component design The latter design would be more appropriate if the municipalities studied had been randomly drawn from a larger population and the goal was unconditional inference about the larger population. The random effects design assumes random error variance between cross-sections (i.e., between municipalities) and that is coo restrictive for this study. In this instance, errors between many of the cross,sections may not be random because many of the municipalities are in relatively close geographical proximity to each other, they are subject to the same state laws regarding their taxing and spending, and rhey are influenced 38 These program variables would be coded zero for all years except the year of an amendment's adoption, if a one,time "pulse" effect with a prompt return to the original trend were expected. The other often,used coding scheme of zeros prior to adoption and ones for every succeeding year is used to detect a suspected short-term impact that does not later vary from its initial effect. There is no theoretical reason to suspect that either the Gallagher or TABOR amendments would have such limited effects. Nevertheless, these alternatives were explored with the dependent variable "total revenue... Neither the pulse nor the short-term effect were significant and both were followed by a significant long term effect. Accordingly, these alternatives were dropped from the model. 109

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i i I I II by many of the same economic conditions. This is particularly true for cities within the same county. In those instances, identical economic data was applied to each. For these reasons, the covariance, fixed effects model was chosen, recognizing that it allows only conditional inference co the subjects studied and permits no inference to any larger population. 39 These fixed effects are controlled by the dummy variables described earlier. When these are significant, they would allow a relative ranking of each municipality to the others in terms of the overall trends. Nevertheless, these coefficients are not reported in this study because (1) the purpose of the study is not a comparison of one city to another, (2) many of these coefficients are not statistically significant, {3) those that are significant vary from one dependent variable to another, and (4) these coefficients say nothing about the Gallagher or TABOR interventions. Using the dummy variable coefficients would allow comparison of only some municipalities, but not all, for any single dependent variable, but not for others, i.e., the group of cities that could be compared is different for each variable. 39 See Kmenra (1986, p. 630,635) and Judge, er al., (1985, p. 527,529) for discussions and comparisons of rhe rwo models. Mullins and Joyce ( 1996, p. 100, nore 22) also, discuss rhe rwo models in rhe conrexr of a study loosely similar ro rhis. 110

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Statistics I I In a pooled time,series analysis, such as this, two assumptions of ordinary least squares (OLS) regression are often violated to some extent: I (1) the assumption that the error terms or residuals are not heteroscedastic, i.e. that they do not increase in value with increases in the predicted value Oudge, et al., 1988, p. 356,358); and (2) the assumption that these residuals are not serially or autocorrelated. Under these circumstances, Beck and Katz (1995) contend (1) that OLS regression, by itself, produces significantly underestimated standard errors, and (2) that their method of panel corrected standard errors is more reliable. For example, in this instance, pooled regression of total revenue without pane(,correcred standard errors produced an estimated trend coefficient of0.08133 with an asymptotic T,ratio of 13.74 and a probability value ofO.OOO. With the panel,corrected error method used in the study, the trend coefficient was unchanged, but the T ,ratio was 10.75 with a probability value o.000. In the same comparative regressions, the Gallagher program coefficient was ,0.045914 in both cases. Without the panel correction, the T,ratio was with a probability o.001. With the panel correction, the T,ratio was '3.268 with a probability of 0.000. The 111

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magnitude of the correction was not enough, in this example, to make a statistically significant difference at even the one percent level. Nevertheless, the statistical significance is overstated without the correction and, in closer cases, it could make a difference. Greene ( 1997, p. 4 52) argues that it is reasonable to expect some cross-section correlation when the cross-sections are subject to the same economic variables. For this study, there is certain to be correlation between some cross-sections because exactly the same economic data was applied to each municipality in a given counry.40 Also, it is expected that there will be some first lag serial or autocorrelation because municipal budgets for one year are very much based on the prior year's budget. It is expected that this autocorrelation diminishes for lags (years) past the first. The model used in this study relies on the Greene (l997, p. 452) reasoning and model, as corrected for heteroscedasticiry and autocorrelation, using methods suggested by Beck and Katz (1995) (for autocorrelation) and 40 As an example, 26 of the 255 municipalities studied are within Weld County. 112

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by White (1980) (for heteroscedasticity)'41 The result is a cross-sectionally heteroscedastic and time-series autoregressive model, corrected for both these characteristics, chat reports panel corrected standard errors. As described by White (1997), the analytical process first estimates the coefficients by ordinary least squares to obtain estimated residuals. These estimated residuals are then used to compute estimates of the first autoregressive parameter, (SPSS, 1994, p. 261). These estimated parameters, in tum, are used co weight the observations and OLS regression is applied to the transformed model. The error variances and covariances are estimated from the regression residuals of chis transformed model. Finally, a generalized lease squares estimator is obtained by an iterative process using a diagonal matrix and the regression process is completed. The final, calculated results include estimated regression coefficients, asymptotic T -ratios (based on the panel corrected standard errors), significance values (also, based on the panel corrected standard errors), and the R2 values. 41 White's formula, as it is known in the econometrics literature, also, is attributed to Huber (1967), see Stata (1993, Vol., 2, p. 406). 113

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For time-series analysis, a Durbin-Warson statistic is usually reported as a measure of the degree of autocorrelation present. It is not reported for this study because it is not an appropriate test for autocorrelation in the presence of lagged explanatory variables (in this case, the economic variables were lagged one year) or when rho, the estimate of the first order autocorrelation, is not set to zero but is estimated at some other value, as in this instance (White, 1997, p. 271). The Analysis Variations of the Regression Model For the first portion of the analysis, the model was employed once for each of eleven revenue categories and fourteen expenditure categories as dependent variables involving all255 municipalities included in the study. In this step, the model included the six economic indicators, described earlier, a trend variable, the Gallagher and TABOR intervention variables, and a control, dummy variable for each municipality. 114

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As a second part of the analysis, the 255 municipalities were segregated into the six population groups described in Table 5.1. The grouping was based on each municipality's estimated july 1, 1996 population. The regression model was used for each population group with four dependent revenue variables (total revenue, total tax, sales tax, and property tax) and six dependent expenditure variables (total operating expenditure, general government, law enforcement, roads, solid waste services, and recreation). 42 Again, the six economic indicator variables, the trend variable, the Gallagher and TABOR intervention variables, and the control, dummy variables for each municipality in che group were used. In a similar procedure, all the municipalities in the fifteen most eastern counties of the state were grouped together. This group was analyzed using only the property tax and sales tax variables, plus the economic, trend, Gallagher, TABOR, and dummy variables, as before. 42 Although eleven revenue and fourteen expenditure variables were used with rhe aggregate regressions, for those involving population groups, rhe number of variables considered was reduced ro rhe most important four revenue and six expenditure accounts. This reduced rhe number of regressions, for population groups, from 150 ro 60, rhus keeping the study from becoming unmanageably large. 115

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For another analysis, all the municipalities studied were divided into two groups; those that had at least one successful tax increase or exemption issue election after the TABOR amendment (1993 through 1996) and those that had no such election or only failed elections. These two groups were examined using the same procedure and revenue variables as the population groups. For this analysis, only four expenditure variables were used-total operating expenditures, general government, law enforcement, and recreation. Table 5.2 shows the number of municipalities studied in each group with the corresponding number of observations. For each analysis, data for the entire 22,year period were included. 116

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Table 5.2 Municiealities Studied by Groues Group No. Municipalities N= Population 1 to 1,999 168 3,696 Population 2.000 to 4,999 35 no Population 5.000 to 9,999 20 440 Population 10.000 to 49.999 20 440 Population 50,000 to 99,999 6 132 Population 100.000 plus 6 132 Eastern Plains 59 1,298 Successful Eledions 144 3,168 Failed or No Elections 111 2,442 Full Study 255 5,610 As a final analysis, the model was used with all 255 municipalities and the eleven revenue and fourteen expenditure variables, as well as the trend, Gallagher intervention, TABOR intervention, and dummy, control variables for each city or town, but the economic indicator variables were omitted, i.e., these economic fluctuations were not controlled. The results from this set of regressions is then compared with the results obtained with the economic controls. The difference between the two, with economic controls and 117

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without, allows an assessment of the effect of at least these six economic indicators on municipal budgets. Tabular Reporting After the regression results were obtained, each of the estimated coefficients for the pre-Gallagher trend variable and the Gallagher and TABOR intervention variables was converted ino a percentage of annual change as a step toward making the results easier co comprehendY Finally, the post-Gallagher and post-TABOR annual change percentages were computed. These are the computed results primarily discussed and compared in the next chapter. The complete results of these analyses are reported in the tables contained in Appendix G and are discussed in Chapter 6. Table G.l of Appendix G, reports, for the aggregate of all255 municipalities, the 43 Because all of che regressions were log-Log, coefficients are converted into percentages by simple multiplication (coefficient x 100 = percentage). The trend prior to 1985 is the coefficient for the trend variable. The post-Gallagher trend is computed by adding the trend coefficient to the Gallagher coefficient (trend coefficient + Gallagher coefficient= post-Gallagher trend). The poscT ABOR crend is computed by adding all three coefficients rogerher (trend coefficient + Gallagher coefficient + TABOR coefficient = post-TABOR crend). ll8

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estimated regression coefficients obtained for the trend and the two amendment interventions, their associated T -ratios, statistical significance indicators, and the R2 statistic for each of the eleven dependent revenue variables and fourteen dependent expenditure variables in the study. Table 0.25 (two pages) reports the estimated coefficients, T-ratios, and significance for each of the economic variables as obtained in for each dependent revenue and expenditure variable for the aggregate of municipalities. Table, 0 2, converts the obtained estimated coefficients into percentages and calculates the post,Gallagher and post, TABOR trend percentages of annual change. Tables 0.3 through 0.8 report the results of the analysis of population groups and display the obtained estimated coefficient, T,rado, significance indicator, and R2 statistic for each equation. Table 0.9 compares the trend (before Gallagher) coefficients, converted into percentages, across population groups. Table 0.10 compares the Gallagher intervention coefficients, converted into percentages, across population groups and Table 0.11 performs the same comparison for the TABOR intervention coefficients, again converted into percentages. 119

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The next set of tables, 0.12 through G.17, respectively, show, for each population group, the estimated coefficients after conversion into percentages and compare the trend (1975-84), the Gallagher intervention, the post-Gallagher trend (1985-92), the TABOR intervention, and the postTABOR trend (1993-96) results. Table 0.18 (in two pages) concludes the study of population groups by comparing the pre-Gallagher (1975-84), post Gallagher (1985-92), and post-TABOR trends (1993-96) across population groups. Table 0.19 reports the results of the comparison of municipalities when grouped according to their post-TABOR election experience. It includes all the estimated coefficients, T-ratios, significance indicators, and R2 statistics, as well as the trend and intervention percentages. The next series, Tables 0.20 through G.22 reports the results of examining all eleven revenue and fourteen expenditure variables with the model chat includes a trend variable, the Gallagher and TABOR intervention variables, and the control, dummy variables for each of the 255 municipalities. In this step, the analysis was conducted without including the six economic indicators. Table 0.20 reports the estimated coefficients, 120

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the T,ratios, the significance, and the R2 statistic for each equation. Table 0.21 converts the coefficients into percentages and calculates the pre, Gallagher (1975,84), post,Gallagher (1985,92), and post, TABOR (1993, 96) percentages of annual change in the revenue and expenditure variables. The effect of the economic indicator variables is reported by using Table 0.22 to show the difference between the results obtained using them and omitting them. Another analysis was conducted for each of the six population groups, using the basic regression model with its trend, Gallagher, and TABOR variables, its economic variables, and the dummy, control variables for each city in a group. In this instance, an additional independent variable, the natural log of per capita, real assessed property value, was added. Assessed property values for each city, for each year between 1975 and as reported on the CEDIS database, were included in the variable. The results 121

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of using regressing the log of real, per capita property tax revenues on the independent variable are reported in Table 0.23.44 Using 1996 actual dollars, the components of tmal revenue for each municipality in the state (this includes all272 cities and towns, rather chan just the 255 included in most of the study) were taken from the CEDIS database. These were used co compute the percentage contribution of each source to total municipal revenue. These results are reported in Table 0.24 for municipalities in each population group and for those in the fifteen eastern plains counties. Finally, Tables 0.26 and 0 27 report the results of the analysis of municipalities located within the fifteen eastern plains counties. Table 0.26 displays the obtained estimated coefficient, T,ratio, significance, and R2 statistic, for each regression. The last cable, 0.2 7 converts these coefficients 44 With the data available for this study it is not possible to calculate municipal growth limits under the TABOR amendment. Because the limit is based on actual property value, beginning in 1993, county assessors have reported the actual property value for all jurisdictions in their counties. Unfortunately, the information has not been compiled by the Department of Local Affairs. Presendy, it resides only with each assessor, each jurisdiction, and in inaccessible storage boxes at the Department. Assessed values multiplied by assessment ratios for each class of property would equal actual property values, but the amount of assessed value attributable to each class for each municipality is not available 122

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into percentages and calculates the resulting trend percentages (1975-84), post-Gallagher trends (1985-92), and post-TABOR trends (1993-96). The next chapter uses this tabular information for a discussion of the results and their relation to the issues. 123

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CHAPTER6 MUNICIPAL FINANCES UNDER TAX AND EXPENDITURE LIMITATIONS Introduction The practical concern of this study has been: how have the finances of Colorado's cities and towns fared over the past two-plus decades? At least superficially, they seem to have managed quite well. During the 22-year period spanned by this study, total revenues (in real, 1975 base, per capita dollars) grew from $260 in l975 to $344 in 1996. In just more chan twenty years, they increased some 32 percent-an average of more chan one percent annually. Total municipal operating expenditures (again, in real, per capita dollars) rose from about $213 in l975 to more chan $250 in 1996-slighdy less than one percent annually. It appears chat municipal finances should be in good order as shown by their growth in real, per capita dollars taken in and spent: 124

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Figure 6.1 Municipal Total Revenues and Operatinf: Expenditures45 1975-96: GJ I T<*l 1975t.., Per Capilli S) ' e! .!!! :m ; ... ....... -1975...._ ... ! : i 0 0 s 2iD Q. lU 0 ... all G) a. a; 150 G) a::: 100 50 0 I I I I I I h-fl I i I I I I I i I I I I"'" T j I I I .. I I .. } ..... t .. L. 1 . -r . t .. I o t rr tt: 1 1 : l I I ; i : i I I l i I I I I I ! I i i I i I I i i ; I I I I I I i I I l I I I I I I ; I _l_ I I I I I : I i I I : I I I I i i I ; I I I : I I I I I I I I I I I I i ! I I I I i I I I : I I i I ' i : I I i I ; I I I [ I I : I I I I I i i i ; : ; : I I I ' I I I i I i I I l I I I i I I I I I I I I I I i I : I I i i I I i ; I l I ! I I I I I I I I I ; i i I I i ; i I I I I I I i I I I I i : I I I I : Sout:e: CED6 Growth was rather uneven, but may have accelerated somewhat in 1989. There is little evidence of the significant recession in the state's economy during the late 1980s from the growth trend in real, per capita 45 Total municipal revenue and operating expenditures are defined in Appendix C. T oral operating expendiruresare less than total revenues because of non,operating expenditures such as debt service and capital outlays. 125

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dollars of municipal revenues or spending. Without considering economic influences (other than inflation), it appears that the city and town governments did quite well and that there should be little reason for concern about their finances now or in the foreseeable future. The reality, however, is that the past few years were tumultuous. Recalling the discussion in Chapter 4, crude oil prices fell precipitously in 1986 and reverberations echoed through the state economy. Retail sales fell to their lowest levels and unemployment rose to its highest level in two decades. Net migration was out of the state for five years. By the early 1990s, the comer was turned and the latest boom economy began to take hold; from a net migration of about 10,000 into the state in 1990, the tide almost reached 70,000 in 1993. Construction earnings began co climb in 1992. Despite the contraction, personal income had been generally rising since the early 1980s. 126

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Figure 6.2 Colorado Per Capita Personal Income (real dollars. 1975 = 100). 1974,96 10,000 9.500 8 9,000 .... II 8.500 It) ...... 0) :::. 8.000 c J! 7,500 a 0 7,000 I CD 6.500 0 5 a. 8,000 5 ,500 5 .000 olllll!!!!!. 1 l I I i A : i ! ' I I I I I I I I : i i I I I i I I i .......... I I I '! I i I I I I I i I I I I I I I I i I i I I I I I I I I I i I I I I I I I j : I I \ I i ; I : i i I I I I ; I I i I I : I I ; I I i I I i I I ' I I I j : i i I l I : I : I i i i ---Source CEDIS If some of the indicators are mixed, some are quite clear: Not all segments of the economy have participated in the good times. With the exception of a good year often enough to keep stubborn hopes alive, farm income has been stagnant or declining: 127

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Figure 6.3 Mean Colorado Farm Income by Counties-lei (real, 1975= 100, per capita dollars), 1974,95 0 0 ,... II It) CD ,... Source : CEDIS Database i 8 -The manufacturing segment of the economy, in a state that has never had a large manufacturing presence, has been in the doldrums and declining: 40 The data for this figure represent the statewide mean, each year, of the real, per capita farm income for each of the 63 counties. This method was selected because it reflects the economic indicator variable used in the analysis more closely than would the statewide per capita farm income data. 128

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Figure 6.4 Mean Colorado Manufacturini Eaminis by Councy47 (real. 1975 = 100. per capita dollars), 1974-95 i i I -Source: CEDIS Database If manufacturing earnings were declining in the 1990s, service earnings were making sharp gains: 47 The data for this figure were assembled in the same manner as farm income data for the same reason. 129

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Figure 6.5 Mean Colorado Services Earnings by County (real, 1975= 100, per capita dollars), 1975,95 1,400 1,200 8 1,000 u 10 ,... m -800 i 15 800 0 t 0 400 Gi ll.. 200 0 : I I \ I I l l I I l I i i I I I I I : j I I I I I I i I I I I I i ; I I I I I I I I I I : I i l I I : I I ; I I I I I i I I i i I I I I I I I I : ' I Source: CEJIS ---./! I I I I I l I I I I I I i I i I I I : l I I I I I ' I I i I I I i I I j i I : I I I I I : i i : I ' : I i I I I I ; I I I : I I i i ; i I I : i i I I I I ' If Colorado is a state of geographic contrasts from plains to alpine peaks, it is a state of economic contrasts, as well. In 1996, it was home to three counties among the richest ten percent ofU. S. counties as measured by per capita personal income. Of the 3,110 counties in the nation, Pitkin County ranked as the third highest at $46,893, Douglas County was 44th at $33,352, and Arapahoe County was 50th at $32,522. In the same year, three 130

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Colorado counties were among the poorest ten percent; Crowley County was 72nd from the bottom at $12,175, Saguache County was 84th at $12,371, and Conejos County was in 133rd place with $12,926 (U. S. Department of Commerce, 1997). Economically, the period under study was characterized by boom and bust cycles, but that was nothing particularly exceptional for Colorado. The more unusual events of the period were the addition of cwo amendments to the state's constitution. Both were approved by the voters, and both have changed the "playing field" oflocal government finance in the state. The primary task of this study has been to examine the impact of these two amendments on municipal finances in a time of economic prosperity and attempt to parse out their probable consequences during less salubrious economic times. Upon more rigorous examination, the influence of the two amendments during economic expansion becomes clearer and the picture of municipal finances appears not so sanguine. 131

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Revenues and Expenditures in the Aggregate Revenues Looking first at the total of municipal revenues, from both tax and nontax sources, it is appears that the legal constraints imposed by the Gallagher amendment and perhaps the TABOR amendment have influenced growth trends. Figure 6.6 compares the trend of annual percentage increase in total municipal revenues for the period before the Gallagher amendment (1975-84), the interim period between Gallagher and the TABOR amendment and the period after adoption of TABOR The comparison is expressed in terms of annual percentage of increase based upon per capita, real dollars (1975= 100) for the aggregate of all Colorado municipalities: 132

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Figure 6.6 Comparison ofT rends in Total Municipal Revenues (Percent of Annual Increase) 1975,84; 1985-92; and 1993,96 9 813-8 7 "' CD c: 6 ca ..c (.) 1i 5 :J c: 3.54-c: c( 4 -c: 3 Q) a. 1.32 2 1 0 Tra-d-197584 N:E 1te am ID!Is ae estimEd CD!illcia1s cxnated irtD r::aca myes. Sgitca m cth ll'dsl)irgestiJJSI:da:dda1sisirdcaledasctte crd-ct1te 1 lea. Sc:ua! Tati!G2 It appears that municipal revenue growth was slowed significantly after the Gallagher amendment became effective in 1985, but that it was continuing to increase each year with economic conditions held constant. 133

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Because "total municipal revenue" includes a variety of component sources, the next task of the study was to examine the trends for some of these components. The tax components include sales tax, property tax, specific ownership tax, franchise tax, occupation tax, other taxes. 48 The nontax sources are intergovernmental revenue (from the state, federal, and other governments), licenses and permits, charges for services, fines and forfeits, interest income, a miscellaneous category, and transfers from enterprise activities. Figure 6. 7 depicts the percentage contribution to total revenue from each component for the aggregate of all Colorado municipalities during 1996. The percentages were calculated from the actual dollar amoums of each category of revenue. 48 .. Other taxes" includes levies on admissions, lodging, and gaming devices, for example. l34

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Figure 6.7 Municipal Revenue Sources. 1996 (actual dollars)49 CHARGES 9.58% UCENSES& PERMITS 275% Source: Table G.24 Tax 1.74% TRANSFERS FROM ENTERPRISES 1.63% 0.96% SALES TAX 43.51% Because taxes of various kinds account for most of total municipal revenue, the history of their trends before the TEL amendments, during the interim period with only the Gallagher amendment, and after both 49 The components examined as individual dependent variables are displayed in CAPITAL LE1TERS. the others were examined only as they are included in the aggregated variables "total municipal revenue," or "total tax revenue." Appendix C contains a listing of those revenue and expenditure components that were used as dependent variables and includes a description of each. 135

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amendments were in place, reveals an important part of the story regarding TEL effectiveness and impact. Figure 6.8 shows these trends of annual percentage increase in the real, per capita tax revenues for all of Colorado's municipal governments. Figure 6.8 Comparison ofT rends in Total Municipal Tax Revenues (percent of annual increase based on real, per capita dollars) 1975-84; 1985-92; and 1993-96 9 ass8 7 CD C) 6 c: ca .s:: () 1ii :s c: c: <( c: CD e CD s.oo5 4 3 2 1 0 TIB'd-197584 -1 N:tl! fvjn, ttecbalat:Ss ae estinBedcmlidatsCDMJIEdir1D r:sca t:g:s crdthe Sl.rtE Tct1eG2 136

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Before the rwo amendments, municipal real per capita tax revenues were growing at an annual rate of almost nine percent. This fell to five percent after 1984. After 1992, with the advent ofT ABOR, annual growth disappeared and municipal tax revenues were just about flat or shrinking slightly each year. Of the six categories of taxes, sales and property taxes contribute half of municipal revenue and are more than 85 percent of all tax revenues. Clearly, any changes in the growth trends for sales tax would have the most impact on total revenues. Figure 6.9, following, compares the trends of annual percentage increase in real, per capita sales tax revenues for all Colorado municipal governments. The trends are compared for the same three periods of time as before: 1975 through 1984 (before the Gallagher amendment), 1985 through 1992 (after Gallagher, but before TABOR, and 1993 through 1996 (post,TABOR). 137

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Figure 6.9 Comparison ofT rends in Municipal Sales Tax Revenues (percent of annual increase based on real. per capita dollars) 1975,84; 1985,92; and 1993,96 16 14.cn14 12 G) CD c: .! 10 u (ij :::1 8 c: c: <( c: G) 6 u .... G) 4 2 0 l"im: .Ag;in, tt-edalla labels areeSnaed coellic:iens ccrr.eted inc pe1certages v.ith lt"e si{Titianle dlt'e coeftic:ierts irdic:lted by illlterislcs. Sauce: Table G2 Real, per capita municipal sales tax revenues were still increasing each year after the TABOR amendment was adopted. Where they had been increasing by 14.03 percent prior to either the Gallagher or TABOR amendments, rhe rare went to 8.39 percent during the interim, Gallagher period, and rhen dropped to only 1. 74 percent after TABOR. 138

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These sales tax trends are difficult to explain and highlight the need for further research into the operation and implementation of TEL amendments, such as Gallagher and TABOR. In the first instance, the rapidly increasing trend before either of the TEL amendments does not seem to be in keeping with an economy that was essentially level from 197 5 through 1984. The lower trend during the interim period after Gallagher and before TABOR, is not explained by the language of the amendment. The Gallagher amendment's provisions contain nothing that would suggest a reason for this marked reduction in the rate of increase for sales tax revenues. The further reduction in this rate of increase after adoption of the TABOR amendment is not so surprising and is explainable from the language of the amendment. The possible explanations for these trends and their importance to municipal governments is made all the more apparent by the history of the second largest tax revenue source-the ad valorem tax on property. 139

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Figure 6.10 Comparison of Trends in Municipal Property Tax Revenues (percent of annual increase based on real, per capita dollars), 1975-84; 1985-92i and 1993-96 8 6 4 G) C) 2 c CD Q51 .&; 0 Ci 0 c:: Tlli'D-197&84 c c( -2 c G) G) -4 a. -6 -10 ()Ita labas ae eslill"BBedc:aeftici&ECXJM!Ited irm J8C8 tages Wlh the sigifica r;;e d the l.l"dlrl)tng OJellic:iens il"daDDd by a;taiski. Scute: 140

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The trend before 1985 was essentially flat. After 1985 and che Gallagher amendment, the trend was increasing by about six percent annually. If the Gallagher amendment was truly a tax and expenditure limiting amendment, a rising property tax rate after its adoption appears to be a contradictory result. The answer may be that the Gallagher amendment was not primarily meant to limit the growth of government. Rather, it was designed to reform property tax administration and assessment procedures, and to stabilize the incidence of property tax payment between residential and business properties. Along with the Gallagher amendment's provisions about the residential assessment ratio, there were other provisions that reorganized the state board of equalization, removed the state's property tax administrator from the civil service system to a position appointed by the board of equalization, and, most significantly, revamped the state's enforcement of uniformiry and quality in assessments. Accompanying legislation, in conjunction with the amendment, initially changed the base year for 141

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assessments from 1973 to 1977, then to 1983, and then to a base year that is never more than two years past. 5 In the words of the state's propeny tax administrator, "The most important change in propeny tax assessment brought about by passage of the 1982 Constitutional Amendment [Gallagher) has been in the area of enforcement" (Colorado, 1987, p. 6). The focus on equalization and enforcement among the counties was designed to assure that excessive school aid monies would not be paid by the state to school districts in counties with under,assessed property values. Thus the amendment requires assessed values, of each class of propeny, in each county, to be no lower than five percent below the level determined by the state board of equalization. Counties that do not meet the standard are required (since 1985) to levy additional property taxes sufficient to repay the costs of reappraisal and the amount of excess school aid paid by the state to each school district in the offending county. 50 The Sixteenth Annual Report of the Division of Property Taxation (Colorado, 1987, p. 6, 15) contains a good synopsis of the legislation and enforcement changes. 142

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In 1985, ten counties were ordered to repay more than $1.5 million to the state. The next year only three counties were ordered to repay a total of $117,000 (Colorado, 1987, p. 9). By 1988, enforcement actions were brought against 23 of the 63 counties, but the amount to be repaid was only $204,000 (Colorado, 1989, p. 9). In 1993, all counties were determined to be in compliance, but in 1994, two counties, Adams and Arapahoe, were ordered to repay more than $1.6 million (Colorado, 1995a, p. The equalization provisions of Gallagher appear to apply pressure on county assessors to raise, rather than lower, property assessments. Thus, a county assessor and his county must pay for reappraisals and repay school monies to the state if assessments are roo low. There are no similar penalties on the county or assessors for assessments that are too high. In such an event, school districts in the county might get less state money than otherwise, but there is no provision for penalizing the county for it. It seems reasonable to expect that the assessors were not long in perceiving that if error was a possibility, then caution favored over-assessment. Some research (Bloom & Ladd, 1982; Ladd, 1991) suggests that the revaluations of the rype mandated by the 1982 amendment may have allowed 143

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governments to raise taxes more than they would have otherwise. All of this may account for the significant rise in propeny tax revenues during the Gallagher period. The remaining question about the Gallagher amendment goes back to sales tax revenues. Why would sales tax revenues increase more slowly after adoption of Gallagher than before? The amendment says nothing about sales taxes. The answer may lie with Propositions 13 and 4 in California, with representations made to voters about the proposed Gallagher amendment, and with some of the amendment's provisions. At the time Gallagher was being argued in the Colorado legislature, voter discontent with property taxes was fresh on the minds of many. Proposition 13 was the epitome of a property tax revolt and it was only four years old Proposition 4 (the spending limit with revenue refund provisions) was only three years in the past. Thus the Gallagher amendment was touted on the ballot as a measure that "would provide an immediate reduction in the percentage valuation for assessment of residential property from 30 percent to 21 percent of value" 144

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(Colorado, Legislative Council, 1987).51 The offer put to the voters was that if the amendment failed, property taxes would go up 36.5 percent. If it passed, these taxes would go down 4.5 percent. It was an offer not robe refused, and the amendment passed. Gallagher did reduce the residential assessment ratio, immediately, and has continued to further reduce it. The state's homeowners are assured that they will never pay more than 4 5 percent of the total property tax bill. In its 1997 report, the Division of Property Taxation (Colorado, Department ofLocal Affairs, 1998, p. calculates that the amendment has saved residential property owners $3.2 billion over what they would have paid had the assessment ratio stayed at 21 percent. The lower rates of increase in sales tax revenues may be the result of voters having signalled a desire for slower government growth by voting for a TEL amendment such as Gallagher. Bails (1990) anticipated the argument that TELs might have resulted in fewer or smaller tax increase proposals, but found no significant evidence for the idea at the state level. Nevertheless, some years later Poterba (1995) and Shadbegian (1998), again argued over 51 The rext of the Gallagher amendment and the ballot language is contained in Appendix A. 145

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whether any decreased growth resulted directly from TELs or indirectly from changed attitudes brought about by passage of the TELs. If the tax and expenditure limiting intentions of the Gallagher amendment are somewhat conflicting and convoluted, they are clear and direct in the TABOR amendment. The results are apparent in the TABOR trend. Property tax revenues experienced a dramatic reversal and have been decreasing by 9.20 percent yearly. The nature of these trends is that an annual change is compounded from one year to the next. 5 2 This "ratcheting" effect is directed downward by TABOR because it does not allow for rate increases that could alter the trend, unless the voters approve. The effect is magnified by Gallagher's mandated readjustments in the residential property assessment ratio. The synergistic result is that municipalities are rapidly losing this usually stable and reliable revenue source. Between them, sales tax and property tax revenues accounted for 52 percent of municipal revenues in 1996. The remaining revenues came from a variety of sources, none of which accounted for more than ten percent of 52 Ceteris paribus, after eight years of such a trend $1,000 of property tax revenue would have been reduced by more than half to $463. 146

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total revenues. The patterns of growth (or decline) in these other revenue sources may reveal something about municipal reactions to the TABOR and Gallagher TEI..s. Although TABOR requires municipalities to keep their overall revenues within its growth limits, it does not require that increases in the rates or amounts of user charges, fines, licenses, permits, and the like, be approved by voters. For example, cities and towns are free, without voter approval, to increase the price of building permits and traffic fines. The evidence suggests that municipalities have taken advantage of this opportunity. Figure 6.11 compares the trends for annual percentage rates of increase in municipal revenues from charges for services, fines and forfeits, and licenses and permits. The rates examined are based on real (1975= 100}, per capita dollars. Trends in these three categories of revenue are compared for the same three periods of time used throughout the study; pre,Gallagher, the interim after Gallagher and before TABOR, and post, TABOR. 147

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Figure 6.11 Comparison of Trends in Charges for Services, Fines, and Licenses and Permits (percent of annual increase based on real, per capita dollars), 1975-84; 1985-92; and 1993-96 14 12 IITrad-197584 10 CD CD c:: 8 (U .&:. (.) 1ij 6 c:: 4 c:: 2 CD a.. 0 -2 4 l'\bl! Qm aetSiJIBI:d cmlicia1SCXIM!ffed if1D FIJIB tagt5Wihtte9g'ifica O::d1he aSfidens irdaad tasiBislcs. Tci*!G2 Rates of annual increase for each of these revenue sources were significantly increased after adoption of the TABOR amendment, even though the revenues thus generated are counted toward TABOR's overall municipal revenue growth limit. In their 1996 study of data from several 148

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states, Mullins and joyce concluded (among other things) that TELs did result in local tax reductions, replaced by more reliance on state aid and user charges. Colorado's municipalities appear to be increasing their reliance on user charges (especially if fines can be considered a user charge), but as of 1996, these made up only 15 percent of municipal revenues. 5 3 Whether municipalities have been receiving more state aid is answered below. The remaining four sources of municipal revenue included in the study-miscellaneous revenues, the specific ownership tax, revenue from the state, and revenues co the municipality from enterprise activities-present a mixed picture. Figure 6.12 compares trends of annual percentage increase in these four revenue components. Again, the trends examined are for the period prior to Gallagher, the interim period, and the period after TABOR's adoption. 53 California voters have apparently foreclosed a similar response, at least with respect to property-related fees. Effective January, 1997, Article XIIID of the California constitution generally prohibits property-related fee increases. 149

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Figure 6.12 Comparison ofT rends in Miscellaneous, Specific Ownership Tax, State Aid, and Enterprise Transfer Revenue (percent of annual increase based on real. per capita dollars),1975,84; 1985,92; and 1993-96 14 12 10 CD 8 CD c: ca 6 .&:; 0 1i :::::J 4 c: c: <( c: 2 CD 0 -2 -4 .0 C") Cl) ::::J OQ ID::::J c:c: II CD :E mTra-d-197584 1 DPait-GiiVS"-195-92 fl i ...... ... Nm The tiD labels ae eslii'TED!d CXll!ll'licia1s CXI'Mitl9dirm JbC& t:osv.ith ttesig'ific::a m d t7t C'.Efllisl6. Scute: TitieG2 II) Miscellaneous revenues continued to increase after 1985, bur at a much slower rare than before. Because this category includes interest income on deposits and investments and there is no other obvious evidentiary or theoretical explanation, it appears that this may be down 150

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simply as the result of declining interest rates. U.S. Treasury Bill rates averaged 8.8 percent during the period of 1975 through 1984, having reached a peak of 14 percent in 1981. For the period of 1985 through 1996, the average rate was only 5.7 percent with a low of three percent in 1993 (U.S. President, 1998 and see Figure 4.2 herein). The specific ownership tax is collected by the state on certain propelled and movable equipment (Colorado Constitution Art. X, ). It is distributed to local governments under a fixed formula. There is nothing readily apparent that a municipality could do to influence the amount of this revenue source. The "revenue from state" account includes state aid, grants, and payments in lieu of taxes. Although Mullins and Joyce ( 1996) and McCaffery and Bowman (1978) found that TEL constraints resulted in an increased local government reliance on state aid, this has not been evidenced in Colorado. Although it represented about nine percent of municipal revenues in 1996, the rate of annual increase in municipal revenues from the srare has slowed sharply after the TABOR amendment. Since 1992, rhe rate of increase is little more than flat, ar only 0.4 7 percent. 151

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In Oregon, Ballor Measure 5, essentially promised increased stare aid to local governments as compensation for some of the loss in property tax revenues that would occur with the measure's adoption. In their survey of Oregon local government officials prior to Measure 5's adoption, O'Toole and Stipak (1994) found that many managers were skeptics and did not expect much by way of increased revenues from the state. In a survey, local managers in Oregon said that their original skepticism was confirmed (O'Toole &Stipak, 1998). Colorado's local governments were never given any such promise, apparently with good reason: State government has not escalated its aid to municipal governments. The last revenue account studied was income from enterprise activities. Theory suggests that fiscally restrained governments will prefer to take advantage of any "loopholes" in TEL restraints (Brennan & Buchanan, 1980; Hale, 1993; and Bails, 1982) and, one such "loophole" in TABOR may be enterprise activities. TABOR defines enterprises as a owned business authorized to issue its own revenue bonds and receiving under 10% of annual revenue in grants from all Colorado state and local 152

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governments combined" (Colorado Constitution, Article X, (2) (d), see Appendix B). Enterprise activities meeting the definition are exempt from the revenue growth limits imposed by the amendment. Colorado municipalities are generally allowed to participate in a wide variety of enterprises, including water, sewage, solid waste facilities, electricity and gas utilities, sports and recreation activities, convention and trade show centers, airports, parking facilities, hospitals, and training or storage facilities (C.R.S. 1997, ,3102). They are not allowed to operate "any manufacturing, industrial, commercial, or business enterprise, or any research, product-testing, or administrative facilities of such enterprise .... (C.R.S. 1997, -3-102). Not surprisingly, much of the T ABQR,inspired litigation has revolved around the issue of whether various govemment,owned activities are exempt enterprises (e. g., Nicholl v. E-470 Public Highway Authority, 1995; Regional Transportation District v. Romer, 1993; and Bruce v. Hartin, 1992). With theory suggesting the idea, permission from the legislature, and guidelines from the courts, it would not be surprising to find that 153

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municipalities had increased their enterprise activities after the TABOR amendment. Evidence from comparing trends in the "transfers to enterprise" accounts before Gallagher, during the interim period, and after TABOR is not sufficient to support or contradict the expectation. Before either of the TEL amendments, municipal revenues from this account were rising at an annual percentage rate of just over one percent. During the interim period, the rate of increase fell to less than one percent and after TABOR it fell further to a declining annual rate of over two percent. Activity in this account reflects only transfers of money from an enterprise to the municipal government. If the enterprise is se[f,sustaining and self-funded, neither it nor the municipality may need to transfer funds from one to the other. The municipal-enterprise relationship cannot be likened to the relationship between a parent corporation and subsidiaries. In the latter case, shareholders might eventually grow tired of a subsidiary that never returned a profit to the parent, but in the former case, it may be enough that the enterprise is performing a publicly desired service without requiring support from taxes. 154

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The most that can be said of the "revenue from enterprises" account, as studied here, is that it does not show any increase after the TABOR amendment. This might be somewhat surprising, but it does not provide any conclusive evidence of municipal activity with respect to mitigating TABOR's impact through an apparent "loophole." Spending If municipal revenues are growing at a slower pace after TEL restraints chan before, it follows that spending must be growing more slowly, also. 155

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Figure 6.13 Comparison ofT rends in Nine Municipal Expenditure Accounts 1975-84; 1985-92; and 1993-96 9r--------------------------------------------------, CD C) c: 7 5 as 3 .c (.) Ci 1 c: <( -c: -1 CD -5 mTrem DPait-T.6BR llt:m: lla ID!Is li!flt&!i It eslil'l'Bedc:adcienlsOCIMI1Bd inD pen:a tagesv.i1h lhesgifian:.e rt1he CXll'llliQenls incfc3ed b'f a&tErisks. Scucl!: Table G2 For all of the accounts depicted in Figure 6.13, spending after TABOR was decreasing annually, with some more so than others. General government spending (operating expenses associated with the management and administration of the municipality) had been increasing at an annual 156

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rate of more than 7.48 percent prior to the Gallagher amendment. After Gallagher, this rate of annual increase slowed to 2.88 percent. After TABOR, the annual percentage rate for general government was essentially flat. General government spending was not reduced as much as spending on municipal courts, law enforcement, fire protection, streets, and health (this does not include hospitals). The annual decline in each of these accounts was significant and dramatic, ranging from 5.83 percent for law enforcement to 1.26 percent for fire protection. The declining rate for spending on law enforcement may be surprising in light of generally reported public concerns about increasing crime. For example, in a 1994 national poll of persons 18 or older, Harris Polls found that 80 percent of its 1,246 respondents were "very willing," or "somewhat willing" to pay higher taxes if the added taxes were spent on "fighting crime In the same poll, 90 percent of women respondents were worried about "crime or safety near home." In a 1996 national poll, Harris reported that 63 percent of its 1,005 respondents thought crime was "increasing a lot." By 157

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1997, this was down to 45 percent, and by 1998, it was reported to be 44 percent (University of North Carolina, 1999). In these categories of spending-judicial, law enforcement, fire protection, streets, health, miscellaneous, debt service, and transfer to enterprises-rates of annual decline in spending were steeper than the rate for general government. The evidence appears to lend some credence to the argument that governments faced with fiscal restraint will prefer to spend for their own purposes rather than for public goods and services {Brennan & Buchanan, 1980; Hale, 1993; and Bails, 1982). Nevertheless, any hasty conclusion that the Colorado evidence supports the theory is confounded by other evidence. Figure 6.14 compares trends of annual percentage increase, during the three periods considered, for municipal spending on culture and recreation (parks, recreation centers, community centers, etc.), solid waste services (crash and garbage collection and disposal), capital outlays, and total operating expenditures. This last account includes essentially all spending by municipal govemmencs except those associated with capital outlays and debt service. 158

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I I I Figure 6.14 Comparison of Trends in Four Municipal Expenditure Accounts 1975; 1985-92; and 1993-96 9 8 7 Q) a 6 c: 111 .c 0 Qj 5 :J c: c: 4 -( c: Q) 2 3 Q) Q. 2 1 C'l ....: jaTnm i I DPt&-1"18R I : :; ..... 0 10 1\ba: Data lab!lsaa J&c::a"tagasd arTUII c:hlrge dllrMid fnm8l!ilir'r'Ba:t COIIIIIider&9. 1ht sig'ifica IC8 d 1he U'dartyil'lJ Wl!lll'lic:iert is irdc:alled t7t aDrisks. Scuta: TatM G.2 Although the history of trends for these accounts prior to TABOR was varied, after the amendment's adoption all four accounts had a trend of annual increase. A comparison of the post-TABOR trend for total operating expenditures (plus 0.13 percent) with general government (minus 0.09 percent) (from Figure 6.13) does not reveal much difference between the two. 159

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: It is impossible to plausibly conclude much of anything from this comparison, including the idea that Colorado's municipal governments have preferred or have not preferred spending for administrative and management purposes over spending on services. Does this evidence reveal anything about the relative political power of proponents for various programs? An affirmative answer requires the conclusion that for Colorado's more than 250 municipal governments, from the smallest to the largest, a preponderance of the political power lies with parks and recreation over law enforcement and with parks over streets. There may or may not be some support for the idea in this evidence. The most reasonable conclusion is that more research specifically designed to answer chat question is required before any sound conclusions can be made. Despite the "mixed, bag" of trends in the different spending accounts, the evidence does suggest that municipal spending after the Gallagher and TABOR amendments has slowed considerably from the annual increases it enjoyed prior to these TELs. Similarly, the evidence strongly suggests that municipal tax revenues are not increasing each year, as they were before the TELs. Municipalities have been able to compensate, to a limited degree, for 160

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the decline in tax revenues by increasing their revenue from nontax such as user fees. The Economy's Influence The basic analysis model used in this study was designed to hold the influence of economic cycles and fluctuation constant. The purpose for doing so has been to obtain a picture of Colorado's municipal finances not obscured by the state's economic prosperity during the entire period since TABOR became law. Very likely the most commonly asserted caveat voiced about the amendment has been something akin to "This is okay now, but wait until the economy is not doing so well!" The rest of the thought is generally left unstated, but it is some variation of the idea that when the allowable TABOR growth factors are not growing because of a poor economy, then municipal revenues are not going to be able to keep pace with the demand for services and cutbacks will have to be made. The estimated coefficients of these economic variables, as obtained in each revenue and expenditure regression (for the model that considered the aggregate of all municipalities), are reported in Table 0.29 of Appendix G. 161

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Perusal of these coefficients and their statistical significance reveals that they are not often very closely related to municipal revenues or expenditures, but there are some exceptions. For example, real, per capita, personal income is correlated significantly with total revenue, total tax revenue, sales tax revenue, charges for services, fines and forfeits, and licenses and permits. As might be expected, real, per capita retail sales is significandy correlated with sales tax revenues. Real, per capita construction earnings are significantly related co revenues from licenses and permits. Perhaps this is because the sale of building permits is an important component of this account. Despite these few examples of significant correlation between the economic variables and municipal revenues, the overall conclusion has to be inclined toward the observation that they are not very often or very closely related. In an effort to better gauge the degree of influence economic fluctuations have on municipal finances, the basic regression model was used a second time on all ll revenue and 18 expenditure variables, but without including the six economic variable indicators as part of the equation. The difference between the results obtained with the economic variables and 162

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without them gives a measure of their influence in predicting municipal finances. The results of this second application of the model are reported fully in Table 0.20 of Appendix G. & before, the estimated coefficients were convened into percentages of annual change and these are reponed in Table 0.21. Finally, a comparison of the results obtained from the two models, with and without economic variables, is reported in Table 0.22. This Table repons the estimated coefficients (as converted into percentages), and their significance, for the trend before Gallagher, for the Gallagher period, and for the post, TABOR period, as obtained with the model employing all six economic variables. In an adjacent column, it reports the same information obtained with the model, but omitting all of the economic variables. Finally, a third column repons the arithmetical difference between the inclusive coefficient and the exclusive coefficient. These differences indicate that the six indicators used have very little influence on the resulting calculations of trends before the Gallagher amendment, after it, or after che TABOR amendment. 163

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Figure 6.15, below, illustrates the difference between results obtained for four major revenue accounts during the TABOR period while controlling for the six economic indicators and without controlling for them. Figure 6.15 Comparison ofPost,T ABOR Trend Percentages with Economic Indicators Controlled and without Economic Indicator Controls in Four Revenue Variables -3.11 : D TABOR 'l6 VIMh Econl lc TABOR"' No Econ I .55 -15.82 Source: Table G.22 It appears that when municipal revenues are expressed with inflation, adjusted, per capita dollars, economic fluctuations (at least as measured by 164

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the six indicators used) have only minor effect on the results. As might be expected, the greatest direct influence of the economy is upon sales tax revenues, but for total revenues and even for total tax revenues, the economy's influence is relatively minor. One important caveat to this conclusion is that it is expressed in terms of real (1975= 100), per capita average rates of annual increase. When the impact is converted into actual dollars for any particular year, the perception of budget officers with immediate concerns could be significantly different. The lesson--one that must be drawn with caution-is that municipal finances are reasonably isolated from economic fluctuations. Worry about the future impact of the two TEL amendments being magnified in poorer economic times may be overwrought. The more realistic lesson may be that financial effects arising from the two TELs are discemable now and there is no particular need co defer analysis of or thinking about them co the future. i65

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Election Experiences under Colorado's TELs The rest of the worry about the consequences of the Gallagher and TABOR amendments, usually left unstated, is the assumption that voters will not be very willing to approve tax increases and other measures thought necessary co ameliorate the impact ofT ABOR on municipal revenues and spending. Evidence from municipal elections in the post-TABOR period does not give any indication that voters have been particularly obstinate, unless, perhaps, the issue involves property tax. The Colorado Municipal League (1997, p. 107-110) documents 100 elections, during 1993 through 1996, involving municipal tax questions. In 82 of these elections, the issue involved sales tax and it failed only 34 times (41 percent). Only 18 of the elections concerned property tax issues and in 11 of those (61 percent), the issue failed. This evidence at least suggests that voters may have an open mind about tax issues, but that they much prefer sales taxes co the property tax. That sales tax proposals are much more common than proposals involving the property tax suggests that many municipal governments are 166

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aware of the voter preference. Such an awareness may be reflected in the trends of property tax revenues. To assess the effect of the many elections for either tax increases or simply for exemption under TABOR's provisions (the so-called "de-Brucing" elections), municipalities included in the study were divided into two groups: those that had at least one successful election on a tax or TABOR exemption issue since the amendment became law (1993 through 1996) and those that had only failed elections or held no elections on these issues. The basic regression model was applied to each group and used with four revenue (total revenue, total tax revenue, sales tax, and property tax) variables and four expenditure variables (total operating expenditures, general government, law enforcement, and recreation). The results are reported fully in Table 0.19 of Appendix G. If the towns and cities had successful elections, it seems reasonable to expect that their revenues would have been growing more rapidly chan the revenues of municipalities in the other group. Figure 6.16 illustrates che results of chis comparison: 167

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I i Figure 6.16 Comparison of Revenue Trends for Municipalities with Successful Elections vs. Municipalities Without Successful Elections 6 co 4 ..... C'li 2 C"i Ill - N CJ) N C'! N C"i G) I CD 0 c ca .s: 0 c; = c c < c 8 ... CD Q. -2 4 liVes : I i ON:> I -10 -12 R&-TAB:R 8edia1 Qa.p; teE lha dilta labelsae pata Gg!ls darMd fil:mht estirTIIIIII!Id CXleflic:ier&& Sg1ficalm irdc:abs (*at 1%. ard-at 10%) I'1M baen carried bv.ad. Scute: TatleG19 CJ) CJ) I ..-..... I Those cities and towns that held successful elections under TABOR appear to have enjoyed positive rates of growth in their total tax revenues and in sales tax revenues. Their counterparts with no elections or only failed elections were seeing declining overall tax revenues and sales tax revenues. 168

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Probably the most striking observation from this comparison is that municipalities with success at the ballot box were actually losing property tax revenues faster after TABOR chan chose that either failed or did not try to persuade the voters. The possible interpretations of this seemingly paradoxical result are almost legion, but two obvious questions come to mind: Were the voters content with governments that were decreasing their reliance on property taxes? Were the governments especially perspicacious or were they just lucky beneficiaries of a history oflow property taxes? This last possibility is seemingly negated by comparison of the trends in property tax revenues prior toT ABOR. Between 1985 and 1992, the successful election group had a trend of property tax revenues rising by more than seven percent annually, while the ocher group's race was just five percent. A voter preference implication of the Brennan and Buchanan (1980) theory-that governments will evade TEL restraints or will prefer to concentrate spending on government purposes rather than public services-is that voters prefer spending on public services over spending on government purposes. It seems possible that this implication might be 169

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reflected by successful-election govemmencs showing lower spending on general government than unsuccessful-election govemmencs, or it might be revealed by more spending on parks and recreation versus less spending for this service. The results of comparison by election groups do not suppon the conjecture. Figure 6.17 Comparison of Expenditure Trends for Municipalities with Successful Elections vs. Municipalities Without Successful Elections 6 .... 4 It) ... .... It) 2 - CD ...... Cl It) c: ca ...... .r::. 0 I 0 iii lkallldon ::I c: -2 c: CD () .... CD a. 4 liYes [] f\bj I N::lla: ll1la labels;n fBC& GgasdarMid fia'T't1he Ell!itil'lTIIIBd cmfliderts. ,.. 9g'ifica1ce dtaBCDIIIicir:lns 1-asbaan carried 1i:rY.ad b 1ht labels by asteriScs. Scuta: Tatle G 19 170

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The group of municipalities with successful elections were increasing their spending on both operating expenditures and general government after TABOR, while the other group was reducing in these areas. Does the whole issue depend on crime and police? The answer to that question may be very doubtful, but successful#election cities and towns were not reducing their spending on law enforcement as rapidly as the other group. The far more straight-forward and simple explanation may be that governments that have been successful at the polls have more money and, therefore, spend more money. Governments that have not been successful with voters have less and must spend less. Small Town and Large Citv Trends The next issue for this study is to differentiate the impact of these two TEL amendments on municipalities of different populations. As mentioned earlier, of the 255 governments included in this study, 168 had 1996 populations estimated by the Colorado Department of Local Affairs to be less than 2,000. These are small towns by almost any definition. Another 35 municipalities had less than 5,000 citizens. In Colorado's landscape, these 171

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are often the largest community for many miles in any direction, but they are still small towns by most reckoning. These 203 communities are 80 percent of the number of municipal governments in this study. If there is a distinction based on population between towns and cities in common parlance, most likely only 12 municipalities qualify as the latter. These had populations greater than 50,000. Although neither the Gallagher nor TABOR amendments make any legal distinction between cities and towns and apply with equal force to both, the impacts of these TEI..s may have been different for the small towns and the large cities. The large cities have much more diverse economies than small towns. Large city populations are growing more than small town populations. Real property markets in metropolitan areas are much more active than those of small towns. In a word, the economic circumstances of the large cities are much different than those of the small towns. Since both amendments most directly emphasize property values and property taxes-Gallagher is entirely focused on property tax and TABOR uses real property values as its municipal growth limit-logic indicates that municipalities most dependent upon property tax revenues might be most 172

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directly effected by these TELs. If dependence upon property tax revenues coincided with stagnant property values in some municipalities, then it seems reasonable to expect that these municipalities might be both directly and quickly effected by the TELs. Table 0.28 of Appendix 0 reports the 1996 percentage contribution of various revenue sources to total municipal revenues for the aggregate of all municipalities in the state, for municipalities grouped by population, and for municipalities (of all populations) located in 15 counties of the eastern plains. 5 4 The smallest towns (less than 2,000 population) received 8.44 percent of their total revenues from property taxes. The largest cities (more than 100,000 population) received 7.88 percent of their total revenues from property tax. Towns on the eastern plains received 10.45 percent of their total revenues from property tax. Even though the differences are not great, it is apparent that small towns, particularly those on the eastern plains are more dependent upon property taxes for their revenues. Table 0.26 of Appendix G reports the results of using the regression model for municipalities by population groups to regress property tax 54 These eastern plains municipalities are discussed in the next section of this chapter. 173

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. I revenues on a trend a program variable for Gallagher, another program variable forT ABOR, all six economic variables, and dichotomous control variables for each municipality in each population group. For this regression, an additional variable to control for differences in assessed property values for each municipality was included. The assessed value variable was obtained from actual dollars of assessed value reported by CEDIS for each year from 1975 through 1996 for each municipality. These were converted to per capita dollars by using the annual July 1 population estimates for each municipality as prepared by the Colorado Department of Local Affairs and reported in CEDIS. Finally, using the Denver,Boulder CPI the data was converted to real (1975= 100), per capita dollars. The variable transformed this data into natural logarithms The results of these six regressions are displayed in Figure 6.18, below, and show that, after TABOR and controlling for assessed property value differences, the smallest towns were losing property tax revenues at a rate of 7.39 percent yearly. The largest cities were losing these revenues at a race of 1.07 percent yearly. Towns in the intermediate population groups showed other declining or increasing races for annual property tax revenues. 174

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Figure 6.18 Comparison of Property Tax Revenue Trends by Population Group with Assessed Property Values Controlled 8 Ci a TA!nd"' cD i 6 at i a Fc&t-GIIIIVB' Trend "'I -: E1 Felt-TABOR Trerd.. I 4 0 2 Cll c: 0 .r:. 0 0 ii ::::J c: -2 c 0 0 -4 Q. -10 01ta labels .. eslirnleld coelfic:ieres ClOf'IIMIIIad to '*'*ages Mh sigl ilala inclcalld by aarislcs.. Scuca: Table G.23 With a substantial basis for expecting the TEL experiences of municipal governments to be different from one population group to anmher, the study explored those differences in the manner discussed in Chapter 5 and with the results described below. 175

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Dividing the 255 municipalities into the same six population groups described earlier, Figure 6.19 reflects the annual percentage rates of change in total municipal revenues during the three periods-1975 through 1984 (before the Gallagher amendment); 1985 through 1992 (after Gallagher, but before the TABOR amendment); and 1993 through 1996 (after the TABOR amendment). Figure 6.19 Comparison ofT oral Municipal Revenues by Population Groups 12 : "" ..,. IITnn:t 10 a; [] Past-Gala!;ter 8 El Pea-TABOR CD Cl c: as 6 .r:; 0 iii :;::, c: 4 0 c 2 CD () ... CD ll. 0 .... .... !tit: Cilia lllbals-eslirniBd coelllc::ierD irm trend 'Mth sio1Ji11cance the lridllf CXlellicierts inr:lcated by iiSIIIrisb. Saute: Table G.18 176

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For every population group, the pre, TEL total revenues were increasing much faster for smaller municipalities than they were for larger cities. With the advent of Gallagher, all groups appear to have experienced a lessened rate of increase in their total revenues, hut the growth was still greatest for the smallest towns. The six largest cities actually saw their revenues enter a period of annual decline for seven years, and except for the smallest towns, the other groups experienced total revenues that were growing very little, if any. During the TABOR period, the growth in total revenues for the small towns went down even further. Revenues for the two groups of the largest cities, actually went up after TABOR and appear to be increasing each year. Essentially the same picture {Figure 6.20, below) emerges for the total tax revenues of municipalities compared among the six population groups being considered. After the TABOR amendment, tax revenues of the six largest cities were growing at an annual rate of 1.54 percent. The six next largest cities (in the 50,000 to 99,999 population range) began to rise at an annual rate of 4.69 percent. This was considerably higher than before either of the two TEL amendments, when cities in this group saw their tax revenues 177

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rising by only 1.33 percent annually. Even cities in the 10,000 to 49,999 1 population group appear to have enjoyed rising tax revenues (2.55 percent annually) after TABOR. The picture is quite the opposite for towns and cities in the lowest three population groups. These municipalities experienced declining annual tax revenues after TABOR with the smallest towns suffering the fastest decline at a significant 2.15 percent rate. 178

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Figure 6.20 Comparison ofTotal Municipal Tax Revenues by Population Groups 10 8 CD 6 a c: al .t: (.) 1i 4 ::::s c: 2 c: CD e CD 0 -4 ... I ... m m m a, 0 0 0 on Populeiion Groups 8Trend D Post-Gslla(jler DPost-TABOR Nata : Data labels ant estimllled CI04Ifliaenls no trend I*Cirltages Wlh the significanc:e of the underlying c:oeffic:ients indic:8111d by ast.rislca Sou-at: Table G.18 Among the components of municipal tax revenues, sales tax receipts accounted for 43 percent of municipal revenues in 1996 (see figure 6. 7 and Table 0.24). For the 255 municipalities, as an aggregate, sales taxes were impacted by the two TEL amendments, but they were still increasing every year. Have small towns and large cities fared equally with respect to this important resource? Figure 6.21 compares sales tax revenues for municipal 179

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governments, according to population groups, for the three periods considered. Figure 6.21 Comparison of Sales Tax Revenue Trends by Population Groups 10 8 G en 6 c: ca .s: 0 1i 4 ::::s c: c: c( 2 c: G e G Q. 0 -2 -4 -0) 0) 0) 0 10Population Groups II Trend D II Post-TABOR Nota: Dlta labels ant esam.t8d coelflc:ients conwlted iniD trend percentages Wth the signiftc:anc:e d the coeftlcients irldiad8d bV astenslcs. Source : Table G.18 + c c 0 0 0 For the larger cities, it appears that sales tax revenues may have climbed somewhat faster after the TABOR intervention (3.68 percent 10 yearly) than before the amendment (2.67 percent annually). This picture of sales tax revenues rising more rapidly after TABOR than previously, also 180

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represents the experience of cities in the 50,000 to 99,999 population group. Before either TEL amendment, their sales tax revenues were increasing 2.42 percent yearly. After Gallagher and TABOR, these revenues were increasing by 5.40 percent annually. A different picture emerges for municipalities in the 5,000 to 9,999 population group. These governments appeared to be suffering a declining annual rate of sales tax revenues after TABOR and Gallagher, where they enjoyed vigorous growth before 1985. Towns in the two smallest population groups were experiencing even more vigorous annual increases in sales tax revenues prior to the two TELs. Afterward, these municipal governments appear to have seen their sales tax revenues increase each year, but at much slower rates than before the TEL amendments. The property tax situation is clearer (even without controlling for differences in assessed value, see the discussion and Figure 6.18 above) because the confidence levels are higher for the results, but this clearer picture points toward declining rates of change. 181

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Figure 6.22 Comparison of Property Tax Revenue Trends by Population Group 10 .....:
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' I I I I I adoption. These revenues began to decline following TABOR's adoption. The only population group that showed a rising rate after TABOR was the 50,000 to 99,999 group. For the other groups, the trend after the second TEL amendment was downward. For the two groups of small towns, the decline was a dramatic ten to twelve percent yearly. For Colorado's small towns the loss of these revenues hits particularly hard, because for many of them it cannot be made up easily with increasing sales tax revenues. Table 0.24 shows the percentage of 1996 municipal revenues contributed by the various components for each of the six population groups used in this study. The smallest towns received 33.37 percent of their revenues from the sales tax. By contrast, cities and towns over 5,000 population received at least fifty percent of their revenues from sales tax. In addition to being more dependent on the property tax, the magnitude ofTABOR's impact on this revenue source seems to have been greatest for these smallest towns, also. During the 1993 through 1996 period, they were losing property taxes faster than larger cities and towns, and their sales tax revenues were not growing as rapidly (see Figures 6.18, 6.21, and 6.22, above). Nor does it 183

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appear that other kinds of taxes were rising sufficiently to make up the loss. Total tax revenues for the smallest towns were shrinking significantly each year during the period. Nevertheless, these towns apparently were able to make up some of the decrease in tax revenues from nontax sources, because total revenues appear to have been no worse than flat or slightly increasing each year. The possible exception may be towns in the 2,000 to 4,999 population group. These towns may have been losing some small percentage of their total revenues each year. Comparisons of the trends in spending among population groups show that small towns and large cities have reacted (either by choice or necessity) differently to the constraints imposed by the Gallagher and TABOR TELs. 184

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Figure 6.23 Comparison of Total Operatinif5 Expenditure Trends by Population GroYPs 10 8 0 .... 6 CD a c: CD .r; (.) 4 "i ::I c: c: c( 2 c CD CD CL 0 0) 0) 0) ..... 0) m -2 I ..... I ,. 0 0 0 0 0 ID-0 0 .... -4 Papulation Groups Nolle: Olta labels .. coeftl<:ienlscanvsted inlD !land pen:erlages. The U1darlying siCJi1lcai1C8 is indcal8d b a&lerislcs. Souat: Table G 18 'IBTrend I c Post-Gallagher jDPost-TPBCR : 0) 0) 0) m 0) I 0 0 0 o ID : (") "": + 0 0 0 0 0 Given the impact of the two TEL amendments on municipal revenues for cities and towns in the six population groups, it is not surprising that the same trends are echoed in total operating expenditures. Confidence in the 55 Total operating expenditures is essentially the total spending of a municipality except for debt service and capital outlays. See Appendix C for a complete definition. 185

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post-TEL trends is low because statistical significance was lacking in most instances, but it may be that budgets for operating expenditures were being reduced faster for the smallest towns than for their larger counterparts. When all municipalities in the study were examined in the aggregate, it appeared that both total operating expenditures and general government expenditures may have been reduced after the TEL amendments. Even with these decreased races of annual growth, there was no significantly discernable difference in the rates of increase for both these categories. It may be possible that general government expenditures were reduced more than total operating expenditures, but, if so, it was barely detectable. It was clear, however, that most categories of spending had been reduced more than general government, with only solid waste services, recreation, and capital outlays as spending categories that had continued to increase despite TABOR and Gallagher. When the municipalities are studied by population groups, their record of post-TABOR reductions in the rates of growth as between total operating expenditures and general government expenditures is obscured by a lack of statistical confidence in the results. For all groups it appears that 186

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the rate of growth in both categories of spending was reduced after TABOR. The two groups of largest population may have reduced their general government spending more than they did for total operating expenditures. Cities and towns in the two groups with populations from 5,000 to 49,999, may not have reduced general government as much as they did total operating spending. In the 2,000 to 4,999 group, general government might have been reduced more than total operating spending. 187

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Figure 6.24 Comparison of General Government Expenditure Trends by Population Groups 11 9 7 CD lCD t= CD 5 CD s:. CD 0 a; ::::J 3 t= t= 'E CD 1 u ... CD CL -1 ... ..--3 -5 Ill Trend I Cl Po&t-Gai;Vler ! 0 Post-T.4BOR I Nale: Pa befcre.. the diD labels are t.ed an l.l'ldertying elllrraled coeftlcier1:s anertlld irto trerd peras tagea. Slgl illc:ala ol the coeftlc:ierD is indicallld by alllar1MI.. Scuce: Table G.18 For the smallest towns, reductions in both categories appear co have been about the same. For these, this result may not be too surprising, since most of them do not have large administrative or management structures. The mayors or trustees of many small towns, may occasionally, also, have to catch the stray dogs. 188

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Considered in the aggregate, Colorado's municipalities had reduced their spending on law enforcement (with significance at the one percent level), after TABOR to an annually shrinking rate of almost six percent. When considered by population groups, the record is mixed. 189

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Figure6.25 Comparison of Law Enforcement Spending Trends by Population Groups 15 :mTranct j 10 i C Pol!it-TABCR I G Cl c Ill 5 0 1i 0 :J c 1: 0 G u 0) + .... G 0) 0 (L 0) 0 ai 0 ..,. ci 0 0 -5 0 0 ci oata labels are percertages derived tram the w1eepx di'1J e1D1ded CXIefllc:iens. Statistical Sgi1k:ai1Ce d the I.Riertyirg ooelllciel1s is indc:aled l7f illileri8ls. Sauce: Tatlle G.18 It appears that all groups have reduced their spending on law enforcement, but that cities and towns with more than 10,000 population were continuing to show annual increases in this area. Only the smaller towns showed a downward trend, with the smallest towns showing a significant trend of more than eight percent decline annually. 190

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The reasons for the differences among the municipalities of varying size cannot be known from the data used in this study, but speculation may suggest that crime and law enforcement do not occupy the degree of public concern found in larger cities. Of course, that reasoning implies a measure of voluntary choice in the matter that may not have been felt. Hard, more or less involuntary choices may have been made in the face of fiscal constraint. Whatever the reason, county sheriff departments may have had the burden at least partially shifted onto their shoulders. For all the municipalities, spending after TABOR and Gallagher for culture and recreation may have gone down somewhat, but it appeared to have been continuing a pattern of annual increase at a time when most other categories of spending had been reduced to shrinking levels. When the cities and towns were compared among popula[ion groups, spending on recreation for all but two groups may have followed the overall pattern of some reduction after the TELs, but with continued annual increases. The two exceptions are the largest cities for which spending in [his category may have remained with little annual change and towns in the 5,000 to 9,999 191

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population group. For this latter group, all of the trends were significant and up considerably after TABOR. Figure 6.26 Comparison of Culture and Recreation Spending Trends bv Population Group :IBTrend I 10 8 -2 -I[] Peat-TABOR I I Nelle: The clara labels are a..d an 8lllimllled ooellk:ienCs Ita haW been CXIfMff8d iriD bend perc:ertagel. The l9iftca ICe indicatrn olltlaee caeftldenla taw been retained ..t are incic:atlld by alla'iltal. Sauce: Table G .18 The remaining two expenditure categories, compared among rhe population groups, were spending on garbage collection and on street repair. Confidence levels are roo low for much meaningful discussion, but the trend 192

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patterns among the groups did not appear markedly different from those of the aggregate. Even with the somewhat problematical record of statistical significance encountered in the comparisons among population groups, there is significant evidence that property tax revenues began an annual decline after the TABOR amendment and that the slide landed hardest on the smallest of Colorado's town governments. These munidpalities of less than 2,000 population depend more heavily on property tax revenues than do their more populous neighbors and, at least some of them, may be less able co increase other revenues, such as the sales tax, to make up the difference. Small Towns on Colorado's Eastern Plains Despite the evidence of small town experience with the property tax as a group, there is wide variation in the geographic, demographic, economic, and finandal circumstances of these towns. Some are located in remote, sparsely populated areas of Colorado's eastern plains, some are part of metropolitan Denver, and some are in the high mountains of the Colorado Rockies. Some are populated by long-time residents, others by mostly 193

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newcomers. A few are among the poorest, and a few are among the wealthiest in the United States. Some are growing rapidly, and others are slowly dying. Under these circumstances of variety, it is difficult to imagine that all are experiencing the same TABOR downturn in property tax revenues and it is equally difficult to believe chat all would find it arduous co replace those revenues from ocher sources. Some of the variety in their municipal finances can be learned from a few descriptive statistics of their total revenues: Table 6.1 Descriptive Statistics for Municipalities of 1 to 1.999 Population (1996 Actual, Per Capita Dollars based on 1996 estimated Population) (N = 168) Statistic Total Revenue Property Tax Sales Tax Minimum $62.18 $0.00 $0.00 Maximum58 41,331.27 473.64 4,848.49 Median 402.22 55.38 96.53 Mean 1,052.62 78.69 270.18 50 Blackhawk. Colorado. 1996 population estimated to be 251. 194

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Only the most formidable cynic could worry that the ski reson town ofTelluride with a population of 1,861 and municipal revenues of almost $7 million in 1996 would have a problem with finances. Another ski and tourist town, Breckenridge, with a population of 1, 720 had revenues of more than $17 million. Black Hawk, a town of251 population had 1996 revenues of more than $10 million-thanks to its gaggle of popular casinos. 5 7 Despite the spectacular financial success of some small towns in the state, many more have not enjoyed the bouncy and are not likely co enjoy it in the foreseeable future. La Salle, with a population of three more people than Telluride, had revenues about $6.3 million less. Paonia, a few persons smaller than Breckenridge, had about $16.3 million less in revenues. Crowley had one person more than Black Hawk, but revenues of only $44,000 instead of$10 million. Although these smaller, less fortunate towns can be found scattered over the entire state, many of them are located on the high plains in the 15 57 In Colorado, these casinos are located in only a few, small, former gold,mining towns. Gambling can be the new bonanza gold strike, or the vein of ore can disappear much as it did a hundred years ago. Central City, population 3 79, had 1996 revenues of$ 7.5 million because of irs casinos On February 11, 1999, the city administrator announced that the town would have to reduce its workforce because a large casino was closing. 195

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most eastern counties. To assess the particular impact of Colorado's two TEL amendments on smaller towns that have not been so financially fortunate, and are not likely to ever be so fortunate, the study was extended to include all the municipal governments in these 15 plains counties. There are 59 of them. Their region is sparsely populated and heavily dependent on agriculture. 5 8 The median estimated 1996 population of the 59 towns was 502. The largest had an estimated 1996 population of 11,366 and the smallest 48. These towns are the remnants of an agricultural society in counties that passed their population prime in the 1920s, 30s, or 40s and have been slowly declining since (U. S. Census Bureau, 1990). There is no alluring gambling or skiing or other tourism industry; just the more mundane business of growing wheat and raising cattle. Table 6.2 shows the percentage contribution of property and sales tax revenues to total revenues for municipalities in the six population groups used in this study, plus the same information for the 59 eastern plains towns as a group regardless of population. 58 Based on 1992 populations, the population density among the counties varied from 1 to 18 persons per square mile. Farming income for 1990 was 43 percent of total income in these counties (U.S. Census Bureau, 1994). 196

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Table 6.2 Components (as a percentage) ofTotal Municipal Revenues by Groups 1996 Property Tax 1996 Sales Tax Municipal Group Revenue Contribution Revenue Contribution 1-1,999 8.44 33.37 2,000-4,999 7.04 46.65 5,000-9,999 s.n 50.86 10,000-49,999 6.27 51.70 50,000-99,999 7.13 51.48 100,000+ 7.88 50.43 59 Eastern Plains Towns 10.45 36.06 The regression model employed for the population groups was applied to this group of eastern plains municipalities. The results of regressing eight of the revenue variables-total revenue, total tax revenue, sales tax, property tax, charges for services, fines and forfeits, licenses and permits, and revenue from the state-are reported in Table 0.26 of Appendix G. As before, in a second step, Table 0.2 7 shows the estimated coefficients after they have been converted into percentages with the and TABOR trends calculated. Figure 6.2 7 displays the information developed in Table 0.2 7 of Appendix G. The data labels represent annual percentages of 197

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change in trends of the identified revenue variables. Each group of bars represents the comparison of trends before the Gallagher amendment ( 197 5-84), during the interim period (1985-92), and after TABOR (1993-96). Each trend is based on annual changes in real (1975= 100), per capita dollars. Figure 6.27 Comparison of Revenue Trends for 59 Eastern Plains Municipalities 20 B Tnrd (197584) 0 (") cD 0 Polt-Galla(tler (1!J!5.Q2) ..15 El Polt-T.Aa:R(1SJ366) : GJ : m m 10 (") (") N c ..-.....: co ID .....: .c GJ 0:: m "'": ..-

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After the TABOR amendment, and despite losing sales tax revenues annually (-4.08 percent) and property tax revenues each year (-7.54 percent), these towns, apparently, have managed to maintain a slight positive increase in their total revenues each year (0.86) percent. The evidence indicates that they have done so by significantly increasing user fees for services (4.84 percent annually), sales of licenses and permits (3.84 percent each year), and, likely, fines (up 3.91 percent each year). Their is no evidence to indicate that the state government has made any effort to come to their rescue. The annual rate of increase in municipal revenue from the state has decreased from 4.18 percent, prior to the TEL amendments, to 1.19 percent after TABOR. Compared to all towns in the smallest population group (less than 2,000), this group of eastern plains municipalities had a slightly lower rate of increase in total revenues. For the plains communities this rare was 0.86 percent. For the smallest towns, statewide, the rate was 1.06 percent (see Figure 6.19). The pattern was the same for total tax revenues. The smallest towns, across the state, were losing these revenues at a rare of2.15 percent 199

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yearly (see Figure 6.20). The eastern plains towns were losing tax revenues at a rate of 3.39 percent each year. With property and sales tax revenues falling, despite their apparent success with narrowly based user fees, fines, and licenses, it is difficult to escape concern that many small town governments, especially of the eastern plains, may have experienced an impact from the two TEL amendments that bodes ill for their continued viability. This study examined trends over a 22-year period for all of Colorado's municipal governments in an effon to discern changes in those trends that coincided with the adoption of two changes in the constitutional law governing municipal finances in the state. The results of the study have been presented and discussed. The task of the next chapter is to relate these results to the research questions and the literature with which the study began and to offer some thoughts about the utility and limitations of the information obtained. 200

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CHAPTER7 CONCLUSIONS At the outset this study was characterized as being about two issues--the growth of government and citizen efforts to contain it. At the end, it is still about those two issues some two centuries after the Declaration of Independence complained about "imposing taxes on us without our Consent." The theories that framed the direction of the study are grounded in a paradigm of public choice that traces its roots back some rwo centuries, also. In 1776, Adam Smith published An Inquiry into the Nature and Causes of the Wealth of Nations. Along with his publication, and integral to it, came the beginnings of what has come to be known as "rational actor theory" or "rational choice theory." As developed in the late nineteenth century, the theory depends upon a number of assumptions, including (1) that the individual is the basic actor in society, (2) that individuals pursue goals, (3) that these goals reflect each individual's perceived self-interest, and (4) that indh,;dual behavior results from conscious choice. 201

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Although rational actor theory had been developed for understanding market choices. by the 1950s and 60s. scholars had begun co consider it for political choices, as well. The major works on which the application of rational actor theory to politics was formulated are generally considered to be Kenneth Arrow, Social Choice and Individual Values (1951); James M. Buchanan and Gordon Tullock, The Calculus of Consent: Logical Foundations of Constitutional Democracy (1962); Anthony Downs, An Economic Theory of Democracy (1957); Duncan Black, The Theory of Committees and Elections (1958); William Riker, The Theory of Political Coalitions (1962); and Mancur Olson, The Logic of Collective Action (1965). From this heritage, Buchanan and Tullock (1962) carried the political application of rational actor theory beyond consideration of citizen and government choices within a political system ro consideration of behaviors regarding the system itself and, particularly, decisions about changing the constitutional constraints upon it. Buchanan (1991, p. 43,49) argues chac the earlier public choice inquiries of Arrow (1951), Black (1958), and Downs (1957) assumed not only the economists' model of utility maximization by 202

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rational actors, but as well that the choices available to individuals were exogenously imposed by the existing "constitution" of the political system. He defines "constitution" as those rules and laws, including written constitutions, that constrain the coercive powers of government and are expected to endure for a substantial length of time (Buchanan, 1991, p. 4-5). He crafts the phrase "constitutional political economy" to mean the study of choices and behaviors at the intersections of economics and politics considering both the existing "constitution" and alternatives to it. Brennan and Buchanan (1980) contend that this "constitutional political economy" paradigm is particularly useful in examining fiscal limitations such as California's Proposition 13 (and, by analogy, Colorado TABOR) because these are citizen-initiated decisions changing the constitution of the existing political system. The idea of citizen-initiated constitutional amendments, such as Colorado's TABOR amendment and California's Proposition U, came from Populist and Progressive politicians and reformers of the late nineteenth and early twentieth centuries. These were people reacting against the economic theories (laissez-faire) and excesses of the day. From an era in which the 203

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economic interests of railroad and mining barons dominated and often controlled state legislatures, particularly in western states such as California and Colorado, came the idea that giving the power of participatory democracy, in the form of citizen-initiated statutes and constitutional amendments, would allow citizens their rightful, ultimate power over government. As the passage of time has dimmed memories of the original arguments for such initiated amendments and the original economic interests that opposed them, it has resulted in the intellectual descendants of each position switching sides in the debate. Thus the progeny of laissez-faire market economics now argue for the power of initiation and scions of the Progressive era's professional, expert public administrators argue against them. McCaffrey and Bowman in their Public Administration Review article (1978, p. 530) provide an example: ... [T] he initiative as an electoral device is generally classified as one of the package of reforms growing out of the Progressive movement of the early 1900's; it permits direct democratic participation. Yet the s rudy of Proposition 13 raises serious questions about the feasibility of participatory democracy in a policy area which commonly has been dominated by experts. 204

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It is from these antithetical origins that Proposition 13 and TABOR came to be constitutional fixtures for local governments in their respective states. This study of Colorado's TEL amendments-Gallagher and TABOR-will not settle either the original debate or its modern version, but the results of this study do raise some interesting issues for consideration in the exchange of views. The expertly prepared, proposed, and referred Gallagher amendment held out the promise to voters that property taxes would go down, but they went up instead. The inexpert, citizen,initiated TABOR amendment promised to "restrain most the growth of government," and it appears to have done so. Is there a difference in implementation and outcomes between legislation or referred constitutional amendments as they come out of the give,and,take of a legislature, and citizen,initiated measures subjected only to election campaigns? This study cannot answer the question, but it bears research and deserves an answer. Neither side in the argument should take solace from having anticipated all of the consequences, or even the magnitude of some 205

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consequences. Nor should either side take much comfort out of the legal writing skill displayed in their respective efforts. The TABOR amendment is rife with ambiguous language that has and will generate much work for lawyers and courts. The Gallagher amendment is not too ambiguous, but the wisdom of establishing an elaborate process for penalizing underassessments while saying absolutely nothing about over-assessments is open to debate. The thrust of the McCaffrey and Bowman article was an assumption that those who voted for the amendment did not fully appreciate the draconian consequences that would flow from its adoption. Although this study did not delve into the issue, it may be chat Colorado voters did not j understand all the consequences ofT ABOR as they voted for it. 5 9 Nevertheless, in a statewide survey of registered voters, almost two-thirds of the voters in 1999 replied that they would vote for the TABOR amendment again, if it were on the ballot today (University of Colorado at Denver, 1999). 59 It is not any more certain chat anybody else, however t!xpert or inexpt!rt, understood aU of the consequences. 206

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The direction of this study of Colorado's municipalities was somewhat different from the more cursory review of California's circumstances by McCaffrey and Bowman. In this instance, no effort was made to assess whether the voters knew what the effects and consequences would be or whether they would be pleased with them. Rather this study was focused on the following questions: 1. Prior to adoption of the TELs, were municipal governments growing as measured by trends in annual percentage rates of change, based on constant, per capita dollars, for different revenue and expenditure accounts? 2. Did any rates of growth for different revenues and expenditures change after the first TEL became law? Did they change again, after the second TEL was adopted? 3. Were rates of growth, before the TELs and afterward, different for small towns and large cities? 4. Were rates of growth different for municipalities in which the voters had passed at least one successful TEL exemption or tax increase issue versus those municipalities in which all such 207

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issues failed at the polls or for which no such issues were placed before voters? 5. Did municipalities, faced with TEL restraints, react by preferring to reduce spending on public goods and services over spending on government management and administration? 6. Did municipalities again, under TEL restraint, attempt evasion or mitigation of the restraints by use of available, legal means? 7. Did fluctuations in the state's economy exert a significant effect on municipal revenues or spending? 208

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Findings and Incernretations Government Growth in the Absence ofT ax and Expenditure Limitation The theoretical assumptions that government grows, as measured by its revenues and spending, in the absence of TELs, appears to be a reasonable assumption. During the study period before either of the TELs was law (1975 through 1984), Colorado's municipal governments, in the aggregate, grew as measured by annual rates of increase in real, per capita dollars of and spending. When municipalities were considered by population groups, from small to large, the findings were essentially the same, but there was variation among the groups. Prior to the TELs, total revenues of the smallest towns were increasing most rapidly, with somewhat lower races for each next larger group. On the ocher side of the ledger, spending for municipalities, in the aggregate, prior to TELs, was also increasing with exceptions in some areas. T oral operating expenditures and spending for government management and administration were growing as was spending on law enforcement, street 209

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maintenance, parks and recreation, health, and capital outlays. Spending in such areas as municipal courts, fire protection, and solid waste services was generally not increasing. When considered by population, spending trends were about the same as for the aggregate, but, again, there was variation among the groups. The largest rates of increase were associated with the smallest towns and conversely, the smallest rates of increase were shown by the largest cities. Whether such growth is desirable or loathsome to the citizenry was not an issue examined in this study. The adage that Americans like their governments weak, cheap, and close to home suggests a citizen preference,60 but beyond the adage there is ample room for convincing research into the particulars. In this study, the findings chat sales tax revenues were increasing, but that property tax revenues were not, suggests another voter preference. It suggests, also, that the process of government growth may be influenced by citizen preferences even in the absence of TEL amendments. 00 Colorado voters apparently agree with che adage: in 1999, confidence in local government was reported co be at 31 percent, in scare government at 21 to 27 percent, and in the federal government at between 12 and l3 percent (University of Colorado at Denver, 1999). 210

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Growth After the First TEL (Gallagher) After the Gallagher amendment became effective in 1985 and before TABOR became law on the last day of 1992, revenues and spending (measured by average, annual rates of change in real, per capita dollars) by municipal governments, in the aggregate, generally declined, but were still growing each year. In particular, sales tax revenues were still increasing each year. On the other hand, property tax revenues showed sharply increased rates of growth after adoption of the Gallagher amendment. As noted earlier, it seems ironic that sales taxes would fall after adoption of an amendment that says not one word about them and property taxes would rise after the same amendment promised their reduction. Some of the possibilities for the property tax revenue rise include the Gallagher amendment's penalties for under,assessmem with no corresponding enforcement against over;assessment or the rapid rise in assessed values (mandated by Gallagher's requirement co rapidly move the assessment base year current) without sufficient mill levy decreases. Much more certainly, the irony illustrates limited knowledge and the need for more research. 211

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Growth After the Second TEL ITABOR) If the tax and expenditure limitation purposes of Gallagher were indirect and incidental, they were direct and explicit in the TABOR amendment. Generally, the post,TABOR period was characterized by further decreases in annual trends for both revenue and expenditure accounts. Although Bails (1990) and Howard (1989) studied state, rather than municipal growth, they reported that TELs were not effective in reducing those budgets. To the contrary, Shadbegian (1998) studied local revenues aggregated by state and found that TEL restraints were effective in reducing the size and growth of local government. The municipal experience with Colorado's two TEL amendments suggests that they have been effective in reducing growth (despite the rise in property taxes during the interim Gallagher period). The findings for nontax revenues lend some support to the idea that governments faced with TEL constraints will seek to mitigate the effect by reducing their reliance on broad based taxes and will tum to narrowly based user fees (Mullins &Joyce, 1996). Revenues from charges for services, fines, 212

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licenses and permits all were increasing significantly faster after TABOR than during the prior periods. Is this increased reliance on user charges, fines, licenses, and permits making the municipal finance structure more regressive? In their 1996 study of state budgets, Mullins and joyce also concluded that TELs resulted in local governments increasing their reliance on state aid. The results in Colorado confirm an increased reliance on user charges, but not on state aid. Municipal revenue from the state government did not appear to have increased after TABOR. If, as suggested by Brennan and Buchanan (1980) and others, TEL constrained governments will seek to avail themselves of any available "loopholes" in the TEL, Colorado's municipal governments might be expected to have increased their enterprise activities61 after TABOR. These are exempt from TABOR's growth limits and, as a result, have sparked much of the litigation associated with the amendment. 01 Recall that Colorado statutes (C.R.S. 1997, ,J,t02) generally allow municipalities to participate in a wide variety of enterprises, including water, sewage, solid waste facilities, electricity and gas utilities, sports and recreation activities, convention and trade show centers, airports, parking facilities, hospitals, and training or storage facilities. 213

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The study found no evidence to suggest that municipal governments had changed the scope or level of enterprise activities, before or after TABOR. The absence of evidence is most likely due to the lack of a suitable, direct indicator for measurement. The accounts studied reflect only transfers of money from municipal governments to enterprises and vice versa. It is entirely possible (and perhaps probable) that enterprises can be created, operate, grow, and even terminated, without any infusion of money from the municipality. The municipalenterprise relationship is not analogous to the relationship between a corporate parent and subsidiary and, therefore, there may be no need or incentive to transfer money from the enterprise co the municipality .62 Alternatively, or perhaps contemporaneously, theory suggests that government will respond co TEL restraints by preferring co reduce spending on desired public goods and services over reductions in spending for its own purposes Findings for the aggregate of municipal governments suggest that the theory may be approaching the mark, but not quite there. 62 If the data could be collected, the most direct way ro study changes in enterprise activity would be to measure the revenue and spending trends of the actual enterprises. 214

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In the pose-TABOR period, spending for municipal courts, police, fire, streets, and health, all showed declining rates. To some extent, chis is contrary co California's experience under its Proposition 13 as reported by Reid ( 1988). He compared the mean, real, per capita expenditures, for 1977-78 and 1984-85, for all California cities and found chat (1) spending for highly visible, essential services such as police, fire, and health services had been maintained or even increased slightly; (2) there had been a large shift away from general government and public works spending; (3) libraries and parks had seen significant reductions; and (4) enterprise activities had been emphasized. The later Galles, Long, and Sexton (1995) study of California municipalities found essentially similar results. For the aggregate of all cities and towns, spending trends for general government management and administration in Colorado were about flat and did not appear to be declining as rapidly as spending in other areas. Spending trends for trash and garbage service and for parks and recreation were increasing in Colorado after the TABOR amendment. These results do not address whether Colorado municipalities have changed the level of privatization for such services as trash and garbage. Increases or decreases in 215

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privatization could well be masked within the trends observed in this study. Most surely, the question needs to be answered and the results of any privatization studied. The results of study in this area could provide valuable guidance to municipal governments. When the municipal revenue trends were compared among population groups, the results are not entirely optimistic for the continued viability of many small, rural towns. In 1996, sales tax revenues accounted for about half the revenues for cities and towns with populations greater than 5,000. By contrast, the smallest towns received only about one-third of their revenues from sales taxes. For property taxes, the proportions are the opposite. After the TABOR amendment became law, rates of sales tax revenue increase for the smallest towns were almost flat and trends for property tax were declining rapidly. Towns in the 2,000 to 4,999 population group were losing property tax revenues by more than 12 percent each year. At chat rate, property tax revenues would be reduced to half in little more than five years. 216

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Much of the decline in property tax revenues appears to come from declining property values in these small towns, but some of it appears to derive from lower rates. For example, in the 2,000 to 4,999 population group, after a statistical control for assessed values was introduced into the model (see Table 0.23 and Figure 6.18), property tax revenues were still going down by 4.09 percent each year after TABOR. For the smallest towns (those in the 1 to 1,999 population group), property tax revenues, after TABOR, were decreasing by 10 percent yearly without the assessed value control, but after holding assessed values constant, these revenues were still decreasing by more than seven percent each year. TELs and the Eastern Plains These results prompted a closer inquiry into the circumstances of the small towns in an economically stagnant agricultural area of the state. Some of Colorado's towns have small populations, but are quite wealthy, while others of similar size, in other areas, are much more financially "challenged." 217

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The 59 municipalities located in the 15 most eastern plains counties63 were examined as a group. The region is characterized by an agricultural economy that has long struggled to maintain its population. After the TABOR amendment, these plains towns were losing property tax revenues and sales tax revenues. Apparently, they have been able to compensate co an extent by increasing their reliance on user charges, license and permit sales, and fines. Because, for most of them, population is not growing, there may be a finite limit on how often the same people can be fined and licensed. It is difficult to escape the conclusion that continued viability for many of them is in some jeopardy. The Economy's Impact One of the enduring observations of the common wisdom in Colorado is that the full impact of the TABOR amendment will not be felt by local governments until the state's economy makes its next inevitable downturn. 63 These are the 15 counties in Colorado that are economically and geographically entirely on the eastern plains. Some other counties such as Adams and Arapahoe extend from their western metropolitan areas many miles eastward on to the plains, but there was no feasible way to consider less than an entire coumy. 218

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In his effort to identify and quantify the causes of government growth, Borcherding (1977) suggested that about 50 percent of such growth was the result of economic factors. He consigned the remaining 50 percent ro the realm of politics. Although he was not very scrupulous about distinguishing among federal, state, and local governments in his conclusions, the focus of his argument was on the national government. It is difficult to conclude that the indicators employed in this study accounted for anything close to half the growth observed, but these results most surely do not mean that municipal budgets are entirely immune from the economy. The eastern plains towns demonstrate that municipalities in che midst of a long-cenn declining economy are hardly immune from it. However, the results do suggest that municipal budgets tend to be somewhat independent of shorter cenn fluctuations. Further support for the conclusion comes from trends observed during the interim Gallagher period. At a time when the state's economy was in such dire straits that net migration was outbound, from an historically high inbound migration state, municipal revenues continued to show an annual trend of increases. 219

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Research into the actual budgeting processes of large cities and small towns could prove useful in establishing a measure of the inflation experienced by local governments that is more accurate chan the Denver, Boulder CPl. Perhaps municipal road and street budgets are much more affected by asphalt prices than they are consumer prices. Conclusions and Other Thoughts Colorado's unique tax and expenditure limitation amendment has (as of early 1999) been a part of the constitution for just more than six years. Brennan and Buchanan (1980) contend that such an amendment, as a permanent part of the constitution, will be resistant to the budgetary pressures of politicians and voters with more immediate concerns. Although the reasoning holds a certain logical nearness, it ignores a great American penchant for political persistence and litigation. Unlike the neatness of theory, it seems apparent that the courts still retain the power to drastically alter the impact of even constitutional amendments such as TABOR. If this power is brought to bear through some of the potential issues that have yet to appear in court, it seems most likely 220

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that TABOR's meaning and potential impacts are still subject to change, even though it is an enduring constitutional amendment. Even decisions already made are subject to the vagaries of future, different judges. The large unknown for future litigation over the amendment is its potential to drastically alter the impact and effects ofT ABOR. This study looked at the first three years ofT ABOR's implementation-a very short time in the life of a constitutional amendment. A similar study a few years hence may reveal entirely different or even opposite results, without a word of the amendment itself having been altered. If the course of future litigation is an unknown, perhaps a larger unknown is the impact of this TEL on other forms of local government in the state. Colorado has 63 counties, 176 school districts, more than 2 70 municipalities, and more than 1,400 special district governments, plus one state government. The post-TABOR budget trends of all these need to be studied before any claim can be laid to complete understanding of the issues that will doubtless arise. 221

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Findings of this study provide a few hints about some of the potential intergovernmental issues. For example, in the smallest towns, post-TABOR spending on law enforcement was declining quickly. What, if any, extra burdens will this mean for county sheriffs? Among all municipalities, spending for health was declining. Does this imply burdens being shifted to another level of government? Thus far it appears that the state government has not particularly changed its level of funding support for municipal governments, but does the ever stagnant economy of the eastern plains portend future changes or demands? Clearly, Colorado's municipalities are increasing their reliance on user charges, fees, permits, licenses, and the sales tax. Is the regressivicy of the municipal tax structure changing as a result? This study did not address the issue, but it should be examined. Are there alternatives char might be made available to local governments that would address regressiviry issues? Is this a concern of the voters or might it become a concern? This study made no effort to understand the thought process that individual budget officers and municipal officials use to formulate next year's budget. It made no effort to develop an understanding of citizen concerns 222

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and desires about the functions and costs of local government. For example, this study concerns itself solely with tax revenues as received by municipalities. It does not address the issue of whether individual tax bills, payments, and burdens are changing. An informed understanding of all these issues could be very useful to practitioners developing budgets, to academics attempting to bring comprehension and cohesion to a welter of confusing theories, and to citizens attempting to vote intelligently and knowledgeably. The study's findings do raise some more urgent issues. How long can small towns on the eastern plains remain viable in the face of declining sales tax and property tax revenues? Is it desirable or necessary that they remain? Is there anything that can or needs to be done by state government or will the town citizenry be able to decide and fend for themselves? If they wither, what will it mean for the economy, population, and other governments of the area? Discussion about the comparative differences between those municipalities that had at least one successful tax issue or exemption election since TABOR was adopted and those that did not have this success 223

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have been deliberately left to the end. Municipalities with election success showed property tax revenues decreasing faster chan for munidpalities without election success. Does this suggest that the property tax is not popular and is on a long-term wane? Does it suggest chat governments failing co recognize its lack of popularity will have difficulty with voters? Perhaps ocher, more palatable, revenue sources need co be explored. If property taxes are waning, important implications may lie with other forms of government chat are even more dependent upon property tax revenues, such as school districts and counties The lase lesson co be learned from chis study may be chat participative democracy, particularly in the arena of tax policy and public budgeting, can be unkempt and rewarding at one and the same time. For practitioners, the need to understand it and how to work within it are crucial to daily issues. Does TABOR imply more elections? Do more elections imply framing issues in different ways? Will choices be more constrained? For academics, a much greater understanding of participative democracy and its relationship to policy and budgeting could lead to better theoretical framing and, thence, to more assistance to practitioners. Is it possible to develop better indicators of 224

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election success on tax and expenditure issues? Are there potential revenue sources to replace the property tax? How might education for citizens be improved? Finally, a better citizen understanding of their responsibilities and burdens might raise the level or change the focus of discourse. Ultimately, whether the TABOR amendment and other TELs have this effect or that, voters can change it all to suit their desires and needs. In the final analysis, raising the level of participative democracy may be the really permanent legacy of the TABOR amendment and other such constitutional tax and expenditure limiting amendments. 225

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APPENDIX A THE GALLAGHER AMENDMENT AND RELATED MATERIALS Note: The Gallagher amendment was not a simple addition to the constitution, rather it amended existing sections (Article X, and 15), by deleting some material, retaining some of the existing language, and adding its own provisions. As an aid to understanding the process and result, the following text uses conventional type, without modification, for the pre existing language, places a strikeout through deleted language, and underlines new language supplied by the amendment. The paragraph immediately preceding the amendment is from the ballot and House Concurrent Resolution No. 1005. Following the text of the amendment, excerpts of the arguments for and against the amendment, as printed on the ballot for voter perusal, are presented. Sections 3 and 15 of article X of the constitution of the state of Colorado are amended to read: Section 3. Uniform taxation-exemptions. (1) (a). All raxes Each property tax levv shall be uniform upon eaefi of rfie various classes of all real and personal property not exempt from taxation under this article located within the territorial limits of the authority levying the tax. and shall be levied, assessed, and eollecred The actual value of all real and personal property not exempt from taxation under this article shall be determined under general laws, which shall prescribe such methods and regulations as shaH secure just and equalized valuations for assessments of raxes upoft aU real and personal property not exempt from taxation under this article. real and persoftal, loeared widrlft rhe rerriroriallimirs of rhe aurhofiry lev'"y"ing rhe EH, pro"v'idecl, howe,er, d\8[ Efte gef\eral assemelf ft\S:f, B"y' law. Valuations 226

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for assessment shall be based on appraisals by assessing officers to determine the actual value of property in accordance with provisions of law, which laws shall provide that actual value be determined by appropriate consideration of cost approach, market approach, and income approach to appraisal. However, the actual value of residential real propertv shall be determined solely by consideration of cost approach and market approach to appraisal; and, however, the actual value of agricultural lands. as defined by law, shall be determined solely by consideration of the earning or productive capacity of such lands capitalized at a rate as prescribed by law. (b) Residential real propenv. which shall include all residential dwelling units and the land, as defined by law, on which such units are located. and mobile home parks. but shall not include hotels and motels, shall be valued for assessment at twentv,one percent of its actual value. For the property tax year commencing January 1. 1985, the General Assembly shall determine the percentage of the aggregate statewide valuation for assessment which is attributable to residential real property. For each subsequent year, the General Assembly shall again determine the percentage of the aggregate statewide valuation for assessment which is attributable to each class of taxable property, after adding in the increased valuation for assessment attributable to new construction and to increased volume of mineral and oil and gas production. For each year in which there is a change in the level of value used in determining actual value. the General Assembly shall adjust the ratio of valuation for assessment for residential real property which is set forth in this paragraph (b) as is necessary to insure that the percentage of the aggregate statewide valuation for assessment which is attributable to residential real property, shall remain the same as it was in the year immediately preceding the year in which such change occurs. Such adjusted ratio shall be the ratio of valuation for assessment for residential real property for those years for which such new level of value is used. All other taxable property shall be valued for assessment at twenty,nine percent of its actual value. However, the valuation for assessment for producing mines, as defined by law, and lands or leaseholds producing oil or gas, as defined by law, shall be a portion of the actual annual or actual average annual production therefrom. based upon the value of the unprocessed material. according to procedures prescribed by law for different types of minerals. 227

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(c) The following classes of personal property, as defined by law, shall be exempt from property taxation: Household furnishings and personal effects which are not used for the production of income at any time; inventories of merchandise and materials and supplies which are held for consumption by a business or are held primarily for sale; livestock; agricultural and livestock products; and agricultural equipment which is used on the farm or ranch in the production of agricultural products. (d) Ditches, canals, and flumes owned and used by individuals or corporations for irrigating land owned by such individuals or corporations. or the individual members thereof, shall not be separately taxed so long as they shall be owned and used exclusively for such purposes. (2) (a) During each property tax year beginning with the property tax year which commences January 1, 1983, the General Assembly shall cause a valuation for assessment study to be conducted. Such study shall determine whether or not the assessor of each county has complied with the property tax provisions of this constitution and of rhe statutes in valuing property and has determined the actual value and valuation for assessment of each and every class of taxable real and personal property consistent with such provisions. Such study shall sample at least one percent of each and every class of taxable real and personal property in the county. (b) (i) If rhe study conducted during the property tax year which commences January I. 1983, shows that a county assessor did not comply with the property tax provisions of this constitution or the statutes or did nor determine the actual value or the valuation for assessment of any class or classes of taxable real and personal property consistent with such provisions, the State Board of Equalization shall, during such year, order such county assessor to reappraise during rhe property tax year which commences January 1, 1984, such class or classes for such year. Such reappraisal shall be performed at the expense of the county. (ii) If rhe study performed during the property tax year which commences January 1, 1984, shows that the county assessor failed to reappraise such class or classes as ordered or failed in his reappraisal to meet 228

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the objections of the State Board of Equalization, the State Board of Equalization shall cause a reappraisal of such class or classes to be performed in the property tax year which commences January 1, 1985. The cost of such reappraisal shall be paid by che state by an appropriation authorized by law. However, if such reappraisal shows that the county assessor did not value or assess taxable property as prescribed by the provisions of this constitution or of the statutes, upon certification to the board of county commissioners by che State Board of Equalization of the cost thereof, the board of county commissioners shall pay to the state the cost of such reappraisaL (iii) The reappraisal performed in the property tax year which commences January l. 1985, shall become che county's abstract for assessment with regard to such reappraised class or classes for such year. The State Board of Equalization shall order the county's board of county commissioners to levv, and the board of county commissioners shalllevv, in 1985 an additional property tax on all taxable property in the county in an amount sufficient to repay the state for any excess pavment made by the state to school districts within the county during the properrv tax year which commences January l. 1985. (c) (i) Beginning with the property tax year which commences January l. 1985, and applicable co each property tax year thereafter. the annual study conducted pursuant to paragraph (a) of this subsection (2) shall. in addition to the requirements set forth in paragraph (a) of this subsection (2), set forth the aggregate valuation for assessment of each county for the year in which the study is conducted. (ii) If the valuation for assessment of a county as reflected in its abstract for assessment is more chan five percent below the valuation for assessment for such county as determined by the study, during the next following year, the State Board of Equalization shall cause to be performed, at the expense of the county, a reappraisal of any class or classes of taxable property which the study shows were not appraised consistent with the property tax provisions of this constitution or the statutes, the State Board of Equalization shall cause to be performed during the next following year, at the expense of the county, a reappraisal of any class or classes of taxable 229

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property which the study shows were not appraised consistent with the property tax provisions of this constitution or the statutes even though the county's aggregate valuation for assessment as reflected in the county's abstract for assessment was not more than five percent below the councy's aggregate valuation for assessment as determined by the study. The reappraisal shall become the county's valuation for assessment with regard to such reappraised class or classes for the year in which the reappraisal was performed. (iii) In any case in which a reappraisal is ordered, state equalization payments to school districts within the county during the year in which the reappraisal is performed shall be based upon the valuation for assessment as reflected in the county's abstract for assessment. The State Board of Equalization shall also order the board of county commissioners to impose, and the board of county commissioners shall impose, at the time of imposition of property taxes during such vear an additional property tax on all taxable property within the county in an amount sufficient to repay, and the board of county commissioners shall repay, the State for any excess payments made by the state to school districts within the counrv during the year in which such reappraisal was performed plus interest thereon at a rate and for such time as are prescribed by law. (iv) If the valuation for assessment of a county as reflected in its abstract for assessment is more than five percent below the valuation for assessment for such county as determined by the study and if the State Board of Equalization fails to order a reappraisal. state equalization payments to school districts with the county during the year following the year in which the study was conducted shall be based upon the valuation for assessment for the county as reflected in the county's abstract for assessment. The board of county commissioners of such county shall impose in the year in which such school pavrnents are made an additional property tax on all taxable property in the county in an amount sufficient to repay, and the board of county commissioners shall repay, the state for the difference between the amount the state actually paid in state equalization payments during such year and what the state would have paid during such year had such state payments been based on the valuation for assessment as determined by the study. 230

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Section 15. Boards of equalization -duties -property tax administrator. (1) (a) There shall be in each county of the state a county board of equalization, consisting of the board of county commissioners of said county. As may be prescribed by law, the county boards of equalization shall raise, lower, adjust, and equalize valuations for assessment of taxes upon real and personal property located with their respective counties, subject co review and revision by the state board of equalization. (b) There shall be a state board of equalization, consisting of the governor, st:aEe at:J:diEer, seaee ffeasttrer, seereeary efseaee, 8ftd au:emey or his designee, the soeaker of the house of representatives or his designee, the president of the senate or his designee, and two members appointed by the governor with the consent of the senate. Each of such appointed members shall be a qualified appraiser or a former county assessor or a person who has knowledge and experience in property taxation. The general assembly shall provide by law for the political composition of such board and for the compensation of its members and, with regard to the appointed members, for terms of office. The filling of vacancies, and removal from office. As may be prescribed by law, the state board of equalization shall review the valuations determined for assessment of taxes upon the various classes of real and personal property located in the several counties of the state and shall, upon a majority vote, raise, lower, and adjust the same to the end chat all valuations for assessment of taxes shall be just and equalized; pre'ridec:l, however, except that said state board of equalization shall have no power of original assessment .... (c) .... (2) The state board of equalization shall appoint, by a majority vote, a property tax administrator who shall serve for a term of five years and until his successor is appointed and qualified unless removed for cause .... Arguments For (1) The amendment would provide an immediate reduction in the percentage of valuation for assessment of residential property from 30 231

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percent to 21 percent of actual value. This proposed reduction in the assessed valuation of residential property would reduce the potential impact of an increase in the assessed valuation of residential property that would occur as a result of a scheduled statutory change in the base year utilized by assessors in the determination of actual value of property. Section 39-1-104 (10)(a), Colorado Revised Statutes 1973, provides that manuals and associated data published by the Property Tax Administrator, utilizing a 1977 level of value, are to be implemented for the assessment years beginning in january of 1983. the 1973 level of value has been utilized by the assessors for the last six years. It is estimated that without this amendment, or a change in law, the aggregate statewide residential valuation for assessment will increase statewide, at least 36.5 percent. With the adoption of this amendment, however, the total aggregate statewide valuation for assessment for residential property, utilizing the 1977level of values, is estimated to decrease about 4.5 percent. The amendment further protects residential property owners from bearing a larger proportion of the property tax burden in relation to other classes in the years ahead except, of course, if there is real growth or new construction. This simply means that, after 1985, the General Assembly would have to enact legislation or revisions in the percentage of valuation for assessment of residential property if inflation would result in a change in the proportion of the statewide valuation of residential property compared to other classes of property .... Arguments Against (1) .... (2) .... (3) By reducing the valuation for assessment for residential property from 30 to 21 percent of actual value, some persons may be misled that there will be a reduction in the assessed value of their respective residences. This simply is not true for a number of reasons. It is uncertain what base year the General Assembly will ultimately apply for the purpose of determining the 232

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actual value of residential property. For the current assessment year of 1982, the base year for determining actual value of property is 1973. Section 39-1104 (10) provides, however, that for the assessment year beginning in January, 1983, the base year for determining the actual value of residential property will be 1977. Because of inflation, it is expected that a 35.5 percent increase in the aggregate statewide valuation for assessment of residential property will occur. For counties in which the valuation for assessment is actually well below 30 percent of value, this amendment could mean a sizeable increase in the valuation for assessment of individual residences despite the ratio reduction proposed in this amendment .... (4) .... (5) .... (6) .... (7) .... 233

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APPENDIXB 1HE TAXPAYER'S BILL OF RIGHTS (TABOR AMENDMEN1) Colorado Constitution Article X, Section 20 (1) General Provisions. This section takes effect December 31, 1992 or as stated. Its preferred interpretation shall reasonably restrain most the growth of government. All provisions are self-executing and severable and supersede conflicting state constitutional, state statutory, charter, or other state or local provisions. Other limits on district revenue, spending, and debt may be weakened only by future voter approval. Individual or class action enforcement suits may be filed and shall have the highest civil priority of resolution. Successful plaintiffs are allowed costs and reasonable attorneys fees, but a district is not unless a suit against it be ruled frivolous. Revenue collected, kept, or spent illegally since four full fiscal years before a suit is filed shall be refunded with 10% annual simple interest from the initial conduct. Subject to judicial review, districts may use any reasonable method for refunds under this section, including temporary tax credits or race reductions. Refunds need not be proportional when prior payments are impractical to identify or rerum. When annual district revenue is less than annual payments on general obligation bonds, pensions, and final court judgments, (4) (a) and (7) shall be suspended to provide for the deficiency. (2) Term definitions. Within this section: (a) "Ballot issue" means a non-recall petition or referred measure in an election. (b) "District" means the state or any local government, excluding enterprises. (c) "Emergency" excludes economic conditions, revenue shortfalls, or district salary or fringe benefit increases. 234

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(d) "Enterprise" means a government,owned business authorized to issue its own revenue bonds and receiving under 10% of annual revenue in grants from all Colorado state and local governments combined. (e) "Fiscal year spending" means all district expenditures and reserve increases except, as to both, those for refunds made in the current or next fiscal year or those from gifts, federal funds, collections for another government, pension contributions by employees and pension fund earnings, reserve transfers or expenditures, damage awards, or property sales. (f) "Inflation" means the percentage in the United States Bureau of Labor Statistics Consumer Price Index for Denver,Boulder, all items, all urban consumers, or its successor index. (g) "Local growth" for a non,school district means a net percentage change in actual value of all real property in a district from construction of taxable real property improvements, minus destruction of similar improvements, and additions to, minus deletions from, taxable real property. For a school district, it means the percentage change in its student enrollment. (3) Election provisions. (a) Ballot issues shall be decided in a state general election, biennial local district election, or on the first Tuesday in November of odd, numbered years. Except for petitions, bonded debt, or charter or constitutional provisions, districts may consolidate ballot issues and voters may approve a delay of up to four years in voting on ballot issues. District actions taken during such a delay shall not extend beyond that period. (b) 15,25 days before a ballot issue election, districts shall mail at the least cost, and as a package where districts with ballot issues overlap, a titled notice or set of notices addressed to "All Registered Voters" at each address of one or more active registered electors. Tides shall have this order of preference: "NOTICE OF ELECTION TO INCREASE T AXES!TO INCREASE DEBT/ON A CITIZEN PETITION/ON A REFERRED MEASURE." Except for district voter,approved additions, notices shall include only: 235

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(i) The election date, hours, ballot tide, text, and local election office address and telephone number. (ii) For proposed district tax or bonded debt increases, the estimated or actual total of district fiscal year spending for the current year and each of the past four and the overall percentage and dollar change. (iii) For the first full fiscal year of each proposed district tax increase, district estimates of the maximum dollar amount of each increase and of district fiscal year spending without the increase. (iv) For proposed district bonded debt, its principal amount and maximum annual and total district repayment cost, and the principal balance of total current district bonded debt and its maximum annual and remaining total district repayment cost. (v) Two summaries, up to 500 words each, one for and one against the proposal, of written comments filed with the election officer by 30 days before the election. No summary shall mention names of persons or private groups, nor any endorsements of or resolutions against the proposal. Petition representatives following these rules shall write this summary for their petition. The election officer shall maintain and accurately summarize all other relevant written comments. (c) Except by later voter approval, if a tax increase or fiscal year spending exceeds any estimate in (b) (iii) for the same fiscal year, the tax increase is thereafter reduced up to l 00% in proportion to the combined dollar excess, and the combined excess revenue refunded in the next fiscal year. District bonded debt shall not issue on terms that could exceed its share of its maximum repayment costs in (b) (iv). Ballot titles for tax or bonded debt increases shall begin, "SHALL (DISTRIC[) TAXES BE INCREASED (first, or if phased in, final, full fiscal year dollar increase) ANNUALLY .... ?" or "SHALL (DISTRICf) DEBT BE INCREASED (principal amount), WITH A REPAYMENT COST OF (maximum total district cost) ... ?" (4) Required elections. Starting November 4, 1992, districts must have voter approval in advance for: 236

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(a) Unless (1) or (6) applies, any new tax, tax rate increase, mill levy above that for the prior year, valuation for assessment ratio increase for a property class, or extension of an expiring tax, or a tax policy change directly causing a net tax revenue gain to any district. (b) Except for refinancing district bonded debt at a lower interest rate or adding new employees to existing district pension plans, 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 years. (5) Emergency reserves. To use for declared emergencies only, each district shall reserve for 1993 1% or more, for 1994 2% or more, and for all later years 3% or more of its fiscal year spending excluding bonded debt service. Unused reserves apply to the next year's reserve. (6) Emergency taxes. This subsection grants no new taxing power. Emergency property taxes are prohibited. Emergency tax revenue is excluded for purposes of (J)(c) and (7), even iflater ratified by voters. Emergency taxes shall also meet all of the following conditions: (a) A 2!3 majority of the members of each house of the general assembly or of a local district board declares the emergency and imposes the tax by separate recorded roll call votes. (b) Emergency tax revenue shall be spent only after emergency reserves are depleted, and shall be refunded within 180 days after the emergency ends if not spent on the emergency. (c) A tax not approved on the next election date 60 days or more after the declaration shall end with that election month. (7) Spending limits. (a) The maximum annual percentage change in state fiscal year spending equals inflation plus the percentage change in state population in the prior calendar year, adjusted for revenue changes approved by voters after 1991. Population shall be determined by annual federal census estimates and such number shall be adjusted every decade to match the federal census. (b) The maximum annual percentage change in each local district's fiscal year spending equals inflation in the prior calendar year 237

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plus annual local growth, adjusted for revenue changes approved by voters after 1991 and (8) (b) and (9) reductions. (c) The maximum annual percentage change in each district's property tax revenue equals inflation in the prior calendar year plus annual local growth adjusted for property tax revenue changes approved by voters after 1991 and (8) (b) and (9) reductions. (d) If revenue from sources not excluded from fiscal year spending exceeds these limits in dollars for that fiscal year, the excess shall be refunded in the next fiscal year unless voters approve a revenue change as an offset. Initial district bases are current fiscal year spending and 1991 property tax collected in 1992. Qualification or disqualification as an enterprise shall change district bases and future year limits. Future creation of district bonded debt shall increase, and retiring or refinancing district bonded debt shall lower, fiscal year spending and property tax revenue by the annual debt service so funded. Debt service changes, reductions, (1) and (3) (c) refunds, and voter ,approved revenue changes are dollar amounts chat are exceptions to, and not pare of, any district base. Voter,approved revenue changes do not require a tax rate change. (8) Revenue limits. (a) New or increased transfer tax rates on real property are prohibited. No new state real property tax or local district income tax shall be imposed. Neither an income tax rate increase nor a new state definition of taxable income shall apply before the next tax year. Any income tax law change after July 1, 1992 shall also require all taxable net income to be taxed at one rate, excluding refund tax credits or voter,approved tax credits, with no added tax or surcharge. (b) Each district may enact cumulative uniform exemptions and credits co reduce or end business personal property taxes. (c) Regardless of reassessment frequency, valuation notices shall be mailed annually and may be appealed annually, with no presumption in favor of any pending valuation. Past or future sales by a lender or government shall also be considered as comparable market sales and their sales prices kept as public records. Actual value shall be stated on all property tax bills and valuation notices and, for 238

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residential real property, determined solely by the marker approach ro appraisal. (9) Stare mandates. Except for public education through grade 12 or as required of a local district by federal law, a local district may reduce or end its subsidy to any program delegated to it by the general assembly for administration. For current programs, the state may require 90 days notice and that the adjustment occur in a maximum of three equal annual installments. Enacted by the people November 3, 1992Section 1 of article V of this constitution provides that initiated measures shall take effect upon the governor's proclamation. Subsection (1) of this section provides that this section shall take effect December 31, 1992, or as stated. (See subsection (4).) 239

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APPENDIXC REVENUE AND EXPENDITIJRE ACCOUNTS (Colorado, 1995, p. 11...8-ll-ll) Reporting Account T oral Revenue T oral Tax Revenue Sales Tax Revenue Property Tax Revenue CEDIS Description All revenues used to support the functions of general government, public safety, public works, health, culture and recreation, public welfare, and debt service and capital outlays for these functions. It does not include revenues used to support enterprise activities unless that revenue comes from taxes or transfers. The total revenue raised by imposition of various local levies on persons or property, by the municipality, for public purposes. The revenue raised by a levy on retail sales within the municipality or the use of things purchased outside the taxing jurisdiction. The revenue derived from a municipal ad valorem levy on real property and certain categories of personal property. 240

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Charges for Services Fines and Forfeits Licenses and Permits Miscellaneous Revenue Specific Ownership Tax Charges for services designed to defray the cost of current services that are of particular benefit to the recipient. This does not include utility enterprise charges or intra governmental payments. Revenues received from penalties imposed for the commission of statutory offenses, lawful administrative rules and regulations, neglect of official duties, and forfeits of deposits held as performance guarantees. Revenues from the sale of business licenses and permits allowing a business firm to function, and non,business licenses and permits that allow a specific activity. Non,enterprise developer contributions are also reported in this category. This category includes earnings on deposits and investments, rents and royalties, special assessments, sales of and compensation for loss of assets, refunds of expenditures, contributions and donations, and other revenues not reported elsewhere. Revenue from a state formulated value levy on certain vehicles and mobile equipment. 241

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State Revenue Transfers In from Enterprises T oral Operating Expenditures General Government Expenditures Judicial Expenditures Law Enforcement and Jail Revenue received from state sources such as grants, payments in lieu of taxes, and receipt of charges. This category does not include old age pensions. This includes transfers and payments from enterprise activities to the general governmental activities. These are reponed as net results. The total continuing expenditures made in suppon of general governmental activities. This category includes general government, public safety, public works, health, culture and recreation, and public welfare. It does not include debt service or capital outlays. Operating expenditures supporting the tasks associated with management and administration. Operating expenditures for judicial activities, including the costs of municipal courts and prosecuting attorneys. Operating expenditures incurred for police protection and jail operations. 242

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Fire Protection Roads and Highways Solid Waste Services Other Public Works Health Expenditures I Operating expenditures incurred for fire protection services. Operating expendicures for maintaining roads, streets, and highways, equipment, traffic services, snow removal, street lighting, and street and highway administration. Operating expenditures for crash pick-up, landfill operations, and weed conrrol. Operating expenditures related to storm sewer maintenance or public works expenditures that cannot be further identified. Operating expenditures related to protecting persons from non-human forces, including public health administration, health centers and general clinics, vital statistics, regulation and inspection of food and drugs, animal and pest control, mental health, ambulance service, and cemeteries. This does not include hospitalization or welfare supported health protection. 243

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Culture and Recreation Miscellaneous Expenditures Transfers to Governments and Enterprises Capital Outlays General Activity Debt Service The operating expenditures related to leisure activities, including participant recreation, spectator recreation, parks, fairs, and libraries. Zoos, arenas, auditoriums, and stadiums are considered enterprise activities and are not included in this category. General operating expenditures that cannot be assigned to another account for whatever reason. This account includes transfers and payments to enterprise activities and other governments from the municipality's general government activities. Transfers to enterprises are reported as net results. Expenditures for the acquisition of capital goods, including land, buildings, equipment, and improvements to these items. Payment of debts related to general government activities. Debt service for enterprises is not included. This account includes payments of both principal and interest. 244

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, I I I I I I I I APPENDIXD COLORADO'S MUNICIPAL POPULATIONS July 1, 197 Populations estimated by Colorado Department of Local Affairs (Includes the principal county in which each municipality is located) 245

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... . ----1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 Aguilar Las Animas 674 670 655 633 616 624 632 637 622 591 Akron Washington 1,652 1,6n 1,604 1,561 1 ,574 1,716 1 ,723 1,625 1,868 1,839 Alamosa Alamosa 6,939 6,873 6,674 6,n4 6,766 6,830 7,012 7,000 7,160 7,260 Alma Park 94 94 96 106 117 132 144 148 143 125 Antonno Conejos 1,138 1,107 11121 1,112 1,103 1,103 1,069 1,051 1,058 1,044 Arriba Lincoln 257 252 243 234 232 236 238 248 248 237 Arvada Adams 68 523 71,889 75,012 79,642 83,491 64,576 66 ,992 88,864 68,713 88,588 Aspen Pnkln 3,369 3,564 3,755 3,924 3,788 3,678 3,425 3,348 3,329 3,434 Ault Weld 978 979 987 1,003 1,039 1,056 1,025 978 974 1.on Aurora Adams 108,908 116,349 124,245 137,228 148,528 156,568 170,757 163,179 195,956 209,747 Avon Eagle nd nd nd 333 491 640 719 866 1,048 1,251 Basalt Pitkin 508 528 538 553 549 529 543 603 630 668 Bayfield La Plata 502 540 582 651 en 724 781 834 906 955 Bennett Adams n3 606 830 892 929 942 1,069 1,231 1,516 1,797 Barthoud Larimer 1,930 1,966 2,087 2,188 2,308 2,362 2,429 2,500 2,552 2,605 Bethune Kit Carson 125 132 136 137 144 149 145 139 155 168 Black Hawk Gilpin 245 238 232 232 229 232 249 270 308 320 N Blanca Costilla 235 236 248 257 254 252 259 273 281 276 0\ Blue River Summn 85 109 138 171 203 230 248 274 297 366 Bonanza City Saguache 10 9 9 9 8 8 9 10 10 11 Boone Pueblo 453 445 437 433 435 431 419 411 409 406 Boulder Boulder 77,098 75,912 77.454 n,963 n,825 76,685 n,&74 78,329 78,209 79,907 Bow Mar Arapahoe 990 978 964 973 962 930 944 943 &80 966 Branson Las Animas 73 74 73 72 71 73 n 79 74 67 Breckenridge Summit 875 892 914 919 889 818 855 927 978 1,168 Brighton Adams 10,482 10,925 11,255 12,100 12,602 12,n3 13,145 13,617 13,856 14,111 Brookside Fremont 185 181 178 1n 182 178 182 165 191 190 Broomfield Adams 12,269 13,626 15,133 16,607 18,665 20,730 21,315 21,998 22,409 22,568 Brush Morgan 3,795 3,ns 3,622 3,621 3,935 4,062 4,104 4,196 4,358 4,326 Buena VIsta Chaffee 2,104 2,064 2,094 2,065 2,089 2,075 2,121 2,103 2,032 1,937 Burlington Kit Carson 3,005 3,064 3,060 3,010 3,076 3,107 3,107 3,179 3,244 3,244 Calhan EIPaao 542 532 542 547 548 541 561 623 707 793 Campo Baca 198 199 192 191 168 165 182 182 172 156 Canon City Fremont 11,484 11,583 11,774 12,100 12,698 13,037 13,238 13,422 13,717 13,531 Carbondale Garfield 1,378 1,507 1,681 1,780 1,965 2,084 2,212 2,460 2,488 2,220 Castle Rock Douglas 2,475 2,628 2,864 3,349 3,682 3,921 4,137 4,348 4,678 4,998

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1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Aguilar Las Animas 591 574 575 558 537 520 523 510 574 606 Akron Washington 1 ,803 1,739 1,734 1,715 1,644 1 ,599 1.m 1,785 1,764 1,751 Alamosa Alamosa 7,257 7,426 7,492 7,628 7,592 7 ,579 7,761 7 892 7,803 8,011 Alma Park 114 113 111 130 148 148 152 159 170 1n Antonito Conejos 996 1,000 1,001 953 908 875 837 860 892 893 Arriba Lincoln 248 234 234 236 225 220 234 233 247 249 Arvada Adams 89,048 89,409 89,381 89,448 89,508 89,235 91,004 92,548 94,726 95,934 Aspen Pitkin 3,513 3,858 3,606 3,552 5,048 5,049 5 ,085 5,176 5,404 5 549 Auit Weld 1,083 1,085 1,069 1,078 1,096 1,107 1,150 1,183 1,203 1,233 Aurora Adams 220,796 223,403 223,255 221,270 221,382 222,103 228,499 235,381 239,098 240,599 Avon Eagle 1,444 1,508 1,558 1,611 1,711 1,798 1,857 2 ,215 2,365 2,429 Basait Pitkin 713 729 819 932 1,037 1,128 1,259 1,309 1,389 1,450 Bayftekl La Plata 993 986 1,001 1,023 1,074 1 ,090 1 ,120 1,165 1,232 1,347 Bennett Adams 1,968 1,890 1,841 1 ,819 1,786 1,757 1,786 1,818 1,817 1,935 Berthoud Larimer 2,721 2,805 2,884 2,926 2,941 2,990 3,069 3,176 3,339 3,532 Bethune Kit Carson 166 165 166 169 172 173 170 170 166 173 Black Hawk Gilpin 330 328 279 256 237 227 228 230 237 242 N Blanca Costilla 286 283 293 300 278 272 259 271 2n 278 _, Blue River Summit 403 425 403 413 427 440 456 472 494 538 Bonanza City Saguache 12 13 14 14 15 16 17 17 17 17 Boone Pueblo 398 388 375 365 353 341 351 350 348 348 Boulder Boulder 78,517 79,703 79,836 81,104 82,549 83,312 66,117 86,168 91,685 91,386 Bow Mar Arapahoe 990 951 914 862 866 854 878 901 915 920 Branson Las Animas 85 83 83 61 59 58 58 56 54 54 Breckenridge Summit 1,263 1,302 1,227 1,253 1,270 1,285 1,336 1,392 1,456 1,588 Brighton Adams 14,278 14,208 14,074 14,109 14,179 14,203 14,468 14,824 14,973 15,158 Brookside Fremont 190 182 181 185 182 183 181 185 207 215 Broomfield Adams 22,698 23,172 23,808 24,314 24,591 24,638 25,083 26,671 27,898 29,673 Brush Morgan 4,292 4 .110 4 .183 4.201 4 ,161 4,185 4,348 4 523 4,684 4,897 Buena Vista Chaffee 1,845 1 ,838 1,814 1,748 1,754 1,752 1,821 1,849 1,929 1,957 Burlington Kit Carson 3,142 3,066 3,004 3,009 2,970 2,941 2,890 2,901 2,858 2,979 Calhan EIPaso 850 854 588 585 572 562 565 565 601 624 Campo Baca 147 138 132 133 127 121 116 116 115 116 Canon City Fremont 13,403 12,850 12,807 12,895 12,666 12,687 12,489 12,622 14,062 14,412 Carbondale Gartield 2,579 2,544 2,539 2 ,852 2,843 3,004 3,183 3,239 3,402 3,611 Ca&lle Rock Doug Ia& 5 ,374 6 ,965 7,406 7,841 8,602 8,708 9,334 10,102 10,903 11,870

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Municipality 1995 1996 Aguilar LaaAnlmaa 612 619 Akron Washington 1,764 1,761 Alamosa Alamosa 8,274 8,482 Alma Park 187 201 Antonito Conejos 908 916 Arriba Lincoln 253 260 Arvada Adams 97,354 97,915 Aspen Pitkin 5,630 5 ,524 Ault Weld 1,259 1,295 Aurora Adams 243,467 246,039 Avon Eagle 2,489 2,706 Basalt Pitkin 1 ,578 1,827 Bayfield La Plata 1,443 1,551 Bennett Adams 1,941 1,963 Berthoud Larimer 3,629 3,859 Bethune Kit Carson 176 179 Black Hawk Gilpin 249 251 N Blanca Coati I Ia 287 292 < Blue RIVet' Summit 575 595 Bonanza City Saguache 18 18 Boone Pueblo 355 357 Boulder Boulder 92,974 91,876 Bow Mar Arapahoe 911 908 Branson Las Animas 55 56 Breckenridge Summit 1,603 1,720 Brighton Adams 15,416 15,835 Brookalde Fremont 221 222 Broomfield Adams 31,375 32,634 Bru&h Morgan 4,839 4,999 Buena Vista Chaffee 2,039 2,141 Burlington Kit Carson 3,023 3,054 Calhan EIPaao 632 649 Campo 8aca 117 119 Canon City Fremont 15,059 15,479 Carbondale Garfield 4,005 4,214 Castle Rock Douglaa 12,750 14,230

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1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 Cedaredge Delta 860 907 972 1,030 1 '118 1,164 1,226 1,237 1,288 1,352 Center Rio Grande 1,636 1,623 1,637 1,727 1,625 1,630 1,694 1,735 1,888 1,876 Central City Gilpin 290 287 292 302 311 329 350 371 399 393 Cheraw Otero 189 200 206 213 222 233 243 255 263 268 Cherry Hills VIllage Arapahoe 4,999 4,995 4,993 5,131 5,167 5,127 5,137 5,003 5,360 5,476 Cheyenne Wells Cheyenne 946 951 886 924 953 950 978 997 1,024 1,061 Coal Creek Fremont 221 212 205 199 200 190 183 173 176 171 Cokedale Las Animas 97 97 94 91 89 90 91 90 93 95 Collbran Mesa 278 284 295 307 328 344 334 326 329 313 Colorado Springs EIPaao 184,923 187,163 196,830 204,888 211,327 215,105 224,500 231,872 240,493 251,288 Columbine Valley Arapahoe 666 703 744 812 870 923 942 936 1,013 1,047 Commerce City Adams 17,318 17,169 16,805 17,144 16,923 16,234 16,315 16,481 16,735 17,003 Cortez Montezuma 6,582 6,568 6,646 6,710 7,054 7,095 7,427 7,710 8,110 8,157 Craig Mortal 6,275 6,324 6,764 8,842 7,881 8,133 9,448 10,299 10,746 9,858 Crawford Delta 237 248 263 262 269 268 262 248 241 235 Creede Mineral 637 639 637 643 606 610 an 629 635 623 Created Butte Gunnison 652 667 718 781 854 959 957 955 901 870 N Crestone Saguache 46 48 50 54 52 54 55 56 53 47 + \0 Cripple Creek Teller 606 607 612 638 680 655 678 707 714 690 Crook Logan 188 187 184 179 175 1n 171 161 188 165 Crowley Crowley 222 212 207 192 183 192 195 196 209 204 Dacono Weld 1,243 1,418 1,609 1,821 2,083 2,321 2,450 2,602 2,635 2,258 Debeque Mesa 234 247 265 267 276 279 304 337 324 293 Deer Trail Arapahoe 423 427 432 450 459 463 488 457 490 511 Del Norte Rio Grande 1,685 1,887 1,666 1,685 1,706 1,709 1,756 1,782 1,808 1,790 Delta Della 3,799 3,735 3,731 3,763 3,895 3,931 4,160 4,332 4,243 4,165 Denver Denver 499,371 501,128 496,702 496,054 496,263 492,694 495,990 498,3n 503,273 496,672 Dillon Summit 312 325 341 353 352 337 360 401 415 490 Dinosaur Mortal 339 335 352 326 340 313 335 378 428 421 Dolores Montezuma 822 806 800 791 815 802 874 952 994 993 Dove Creek Dolores 692 704 678 720 738 826 820 808 845 783 Durango La Plata 11,205 11,266 11,365 11,893 11,599 11,649 12,022 12,325 12,591 12,491 Eads Kiowa 887 888 816 788 836 878 902 870 888 919 Eagle Eagle 938 971 985 1,006 993 950 991 1,113 1,156 1,215 Eaton Weld 1,698 1,717 1,749 1,796 1,881 1,932 1,952 1,969 2,022 1,901 Eckley Yuma 217 224 237 240 256 262 258 254 247 234

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1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Cedaredge Delta 1,326 1,285 1,372 1,374 1,3n 1,380 1,435 1,502 1,530 1,597 Center Rio Grande 1,896 1,966 2,034 1,965 1,974 1,963 2,098 2,121 2,181 2,192 Central City Gilpin 398 402 390 364 348 335 337 348 358 366 Cheraw Otero 276 273 271 273 268 265 262 271 269 270 Cherry Hills VIllage Arapahoe 5,516 5,388 5,259 5,192 5,198 5,245 5,484 5,756 5,979 6,126 Cheyenne Wells Cheyenne 1,100 1,046 1,000 1,047 1,092 1,128 1,025 1,137 1,111 1,114 Coal Creek Fremont 165 158 156 158 157 157 155 158 175 183 Cokedale Las Animas 94 121 122 120 119 116 118 116 124 124 Collbran Mesa 278 258 250 245 230 228 236 271 355 358 Colorado Springs EIPaao 262,005 269,488 278,906 280,141 280,665 281,140 283,162 293,558 305,701 315,590 Columbine Valley Arapahoe 1,071 1,071 1,053 1,051 1,066 1,071 1,106 1,152 1,179 1,165 Commerce City Adams 16,999 17,347 16,965 16,780 16,550 16,466 16,765 17,047 17,019 17,084 Cortez Montezuma 7,856 7,618 7,296 7,189 7,240 7,284 7,245 7,476 8,038 7,898 Craig Moffat 9,2n 8,874 8,349 8,263 8,195 8,091 8,3n 8,330 8,204 8,435 Crawford Delta 218 225 241 232 226 221 229 240 241 246 Creede Mineral 593 537 498 457 404 362 347 341 376 382 Crested Butte Gunnison 853 899 885 872 904 878 903 953 990 1,031 N Crestone Saguache 45 46 46 44 40 39 59 80 61 64 Vl 0 Cripple Creek Teller 681 670 665 630 605 584 617 616 626 967 Crook Logan 161 153 150 151 150 146 151 152 140 140 Crowley Crowley 213 210 207 224 225 225 228 238 235 240 Dacono Weld 2,288 2,238 2 ,234 2,247 2,233 2,228 2,271 2,298 2,318 2,334 Debeque Mesa 270 257 257 259 253 257 265 272 272 314 Deer Trail Arapahoe 535 522 507 497 478 476 469 502 509 516 Del Norte Rio Grande 1,803 1,866 1,846 1,819 1,726 1,874 1,738 1,786 1,762 1,n2 Della Delta 4,039 3,855 3,835 3,890 3,836 3,789 3,803 4,000 4,159 4,258 Denver Denver 496,431 497,014 490,274 479,622 472,765 467,610 461,540 491,967 490,801 490,924 Dillon Summit 531 551 514 529 542 553 568 591 619 680 Dinosaur Moffat 402 380 350 347 331 324 336 334 328 337 Dolores Montezuma 967 927 875 855 867 866 904 931 994 986 Dove Creek Dolores 703 680 664 691 670 643 595 550 809 635 Durango La Plata 12,440 11,990 11,888 11,859 12,416 12,430 12,681 12,952 13,275 13,490 Eads l
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Municipality 1995 1996 Cedaredge Delta 1,704 1,792 Center Rio Grande 2,298 2,345 Central City Gilpin 376 379 Cheraw Otero 274 274 Cherry Hilla Village Arapahoe 6,144 6,201 Cheyenne Wella Cheyenne 1,111 1,126 Coal Creek Fremont 190 191 Cokedale Laa Anlmaa 127 129 Collbran Meaa 367 583 Colorado Sprlnga EIPaao 323,332 329,002 Columbine Valley Arapahoe 1,174 1,187 Commerce City Adama 17,129 17,211 Cortez Montezuma 8,102 8,129 Craig Moffat 8,554 8,707 Crawford Delta 263 267 Creede Mineral 390 408 Created Butte Gunnison 1,049 1,067 N Crestone saguache 67 68 V\ -Cripple Creek Teller 1,011 1,079 Crook Logan 142 141 Crowley Crowley 244 252 Dacono Weld 2,344 2,345 Debeque Meaa 323 330 Deer Trail Arapahoe 510 509 Del Norte Rio Grande 1,808 1,798 Delta Delta 4,437 4,708 Denver Denver 492,861 497,007 Dillon Summit 647 698 Dinosaur Moffat 341 340 Dolorea Montezuma 1,025 1,034 Dove Creek Dolorea 864 690 Durango La Plata 13,626 13,991 Eada Kiowa 820 834 Eagle Eagle 2,070 2,194 Eaton Weld 2,274 2,394 Eckley Yuma 218 218

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1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 Edgewater Jefferson 5,262 5,219 5,135 5,125 5,037 4,766 4,924 5,047 4,991 4,940 Elizabeth Elbert 594 631 632 657 721 789 810 844 908 940 Emp!re Clear Creek 329 341 345 374 400 423 436 434 436 427 Englewood Arapahoe 33,799 33,046 32,231 32,214 31,408 30,021 30,925 31,079 30,549 28,n6 Erie Weld 1,218 1,208 1,207 1,215 1,246 1,254 1,263 1,273 1,281 1,299 Estes Park Larimer 2,182 2,229 2,371 2,492 2,635 2,703 2,798 2,910 2,998 3,003 Evans Weld 3,798 3,973 4,181 4,432 4,785 5,063 5,115 5,152 5,612 5,288 Fairplay Park 437 413 397 407 411 421 466 499 513 479 Federal Heights Adams 4,336 4,984 5,598 6,503 7,264 7,846 7,971 8,149 8,085 8,031 Firestone Weld 878 925 979 1,043 1,132 1,204 1,251 1,300 1,363 1,256 Flagler Kit Carson 590 590 5n 556 556 550 552 585 585 594 Fleming Logan 367 374 376 375 376 368 371 348 366 375 Florence Fremont 3,067 3,007 2,965 2,954 3,051 2,987 3,076 3,172 3,282 3,2n Fort Collins larimer 55,519 56,105 59,029 61,356 64,164 85,092 67,146 69,247 70,706 74,897 Fort Lupton Weld 3,391 3,499 3,635 3,806 4,062 4,251 4,319 4,380 4,567 4,611 Fort Morgan Morgan 8,335 8,253 8,318 8,279 8,490 8,768 8,629 9,015 9,276 9,121 Fountain EIPaso 6,089 6,395 6,960 7,474 7,951 6,324 8,651 6,940 9,145 9,424 N Fowler Otero 1,282 1,281 1,253 1,231 1,224 1,227 1,249 1,272 1,244 1,194 Vl N FoXfield Arapahoe nd nd nd nd nd nd nd nd nd nd Fraser Grand 376 365 395 422 447 470 504 546 563 632 Frederick Weld 801 800 805 816 843 855 881 916 947 699 Frisco Summit 924 994 1,082 1,164 1,215 1,221 1,246 1,313 1,321 1,505 Frurta Mesa 2,225 2,261 2,344 2,459 2,653 2,810 3,089 3,416 3,668 3,692 Garden City Weld 124 115 107 100 94 85 94 106 125 123 Genoa lincoln 171 189 185 180 180 165 154 145 138 167 Georgetown Clear Creek 679 697 698 749 793 830 886 914 932 916 Gilcrest Weld 685 736 794 862 950 1,025 1,059 1,091 1,185 1,058 Glendale Arapahoe 1,441 1,598 1,n3 2,022 2,262 2,496 2,580 2,572 2,852 2,806 Glenwood Springs Garfield 4,228 4,159 4,133 4,267 4,537 4,637 4,853 5 ,344 5,415 5,348 Golden Jefferson 11,659 11,657 11,987 12,317 12,494 12,237 12,743 13,227 13,485 13,737 Granada Prowera 576 576 571 563 570 557 545 542 582 800 Granby Grand 850 853 858 698 933 963 997 1,046 1,046 1,149 Grand Junction Mesa 24,366 24,717 25,567 26,044 27,246 27,956 28,915 30,193 31,603 31,009 Grand lake Grand 313 319 326 346 365 382 392 410 365 395 Greeley Weld 47,on 47,505 48,280 49,485 51,709 53,006 53,252 53,235 54,346 57,135 Green Mountain Falls El Paso 508 517 547 572 594 607 625 636 658 685

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Municieali!l 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Edgewater Jefferson 4,954 4,861 4,745 4,686 4,843 4,613 4,863 4,707 4,740 4,707 Elizabeth Elbert 967 938 917 910 859 818 860 846 877 923 Empire Clear Creek 433 436 411 401 406 401 378 394 412 428 Englewood Arapahoe 28,302 28,944 29,215 29,179 29,448 29,387 30,153 30,924 31,369 31,420 Erie Weld 1,313 1,280 1,273 1,275 1,272 1,258 1,300 1,333 1,359 1,435 Estes Park Larimer 3,069 3,132 3,084 3,089 3,150 3,184 3,311 3,467 3,562 3,848 Evan11 Weld 5,715 5,733 5,796 5 ,851 5,861 s,an 6,025 6,122 6,306 6,580 Fairplay Park 455 448 429 407 395 387 402 420 453 479 Federal Heights Adams 8,440 9,663 9,543 9,547 9,375 9,342 9,539 9,726 9,677 9,715 Firestone Weld 1,288 1,303 1,346 1,353 1,356 1,358 1,386 1,397 1,422 1,460 Flagler Kit Carson 580 570 562 569 568 564 553 554 547 567 Fleming Logan 388 352 345 349 346 344 353 354 327 404 Florence Fremont 3,287 3,111 3,060 3,062 3,012 2,990 2,973 3,007 3,397 3,599 Fort Collins Larimer 76,649 79,674 82,272 83,935 86,152 87,758 90,823 93,500 95,916 98,511 Fort Lupton Weld 4,677 4,992 5,104 5,162 5,167 5,159 5,272 5,316 5,376 5,438 Fort Morgan Morgan 9,016 6,721 8,855 8,979 9,001 9,038 9,472 9,671 10,243 10,162 Fountain El Paso 9,737 9,957 10,231 10,204 10,079 9,984 10,034 10,646 11,037 12,375 N Fowler Otero 1,194 1,176 1,164 1,165 1,170 1,154 1,145 1,164 1,173 1,164 V1 Foxfield Arapahoe nd nd nd nd nd nd nd nd nd nd Fraser Grand 865 661 641 607 579 575 566 551 610 626 Frederick Weld 925 955 999 1,004 1,001 968 1,013 1,026 1,039 1,142 Frisco Summit 1,566 1,644 1,532 1,549 1,579 1,601 1,653 1,721 1,819 1,995 Fruita Mesa 3,5n 3,515 3,533 3,639 3,903 4,045 4,159 4,181 4,271 4,411 Garden City Weld 124 122 168 168 168 199 203 205 207 209 Genoe lincoln 173 167 169 174 168 167 178 1n 188 189 Georgetown Clear Creek 948 966 928 913 898 891 832 686 910 944 Gilcrest Weld 1,070 1,056 1,067 1,074 1,082 1,084 1,110 1,121 1,131 1,142 Glendale Arapahoe 2,851 2,743 2,638 2,546 2,481 2,453 2,514 2,567 2,612 2,614 Glenwood Springs Garfield 5,432 5,415 5,511 5,764 6,374 6,561 6,872 6,827 7,046 7,266 Golden Jefferson 14,006 13,762 13,506 13,363 13,243 13,116 13,395 13,720 14,040 14,156 Granada Prowera 600 579 571 571 537 513 507 502 515 523 Granby Grand 1,164 1,161 1,113 1,041 982 966 957 929 1,029 1,056 Grand Junction Mesa 28,945 27,905 27,459 27,565 26,606 29,034 29,830 30,369 32,415 37,236 Grand Lake Grand 392 367 338 301 273 259 253 242 269 276 Greeley Weld 57,331 57,757 59,027 59,693 60,281 60,538 62,130 63,109 64,269 64,908 Green Mountain Falls EIPaso 705 698 696 679 670 663 689 696 725 767

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Municipality 1995 1996 Edgewater Jefferson 4,695 4,660 Elizabeth Elbert 970 1,176 Empire Clear Creek 433 431 Englewood Arapahoe 31,062 31,092 Erie Weld 1,498 1,766 Estes Park Larimer 4,035 4,287 Evan& Weld 6,809 7,088 Fairplay Park 512 531 Federal Heights Adams 9,705 9,554 Firestone Weld 1,473 1,563 Flagler Kit Carson 572 577 Fleming Logan 410 408 Florence Fremont 3,789 3,932 Fort CoiUns Larimer 101,316 103,933 Fort Lupton Weld 5,582 5,712 Fort Morgan Morgan 10,294 10,517 Fountain El Paso 12,995 13,333 N Fowler otero 1,203 1,161 VI Foxfield Arapahoe 580 573 Fraser Grand 659 687 Frederick Weld 1,311 1,498 Frisco Summit 2,399 2,564 Fruita Mesa 4,540 4,683 Garden Cllv Weld 267 266 Genoa Lincoln 192 198 Georgetown Clear Creek 965 976 Gilcrest Weld 1,157 1,162 Glendale Arapahoe 2,946 2,944 Glenwood Springs Gartleld 7,521 7,738 Golden Jefferson 14,462 15,418 Granada Prowera 529 536 Granby Grand 1,114 1,161 Grand Junction Mesa 40,125 40,542 Grand Lake Grand 291 303 Greeley Weld 66,278 67,410 Green Mountain Fall& EIPaso 790 800

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--. -1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 Greenwood Village Arapahoe 4,208 4,424 4,666 5,073 5,421 5,729 6,019 6,200 6,681 6,860 Grover Weld 143 144 146 149 155 158 149 137 138 149 Gunnison Gunnison 5,-402 5,159 5,198 5,308 5,462 5,785 5,7-40 5,699 5,501 5,451 Gypsum Eagle 594 639 675 719 741 743 647 1,021 1,196 1,-401 Hartman Prowers 130 130 128 125 126 122 116 110 119 125 Haswell Kiowa 135 133 123 117 122 126 118 103 99 96 Haxtun Phillips 934 971 970 969 985 1,014 989 983 1,003 941 Hayden Routt 1,193 1,290 1,380 1,523 1,670 1,720 1,668 1,678 1,624 1,604 Hillrose Morgan 168 173 182 188 199 213 213 217 211 196 Holly Prowers 1,020 1,017 1,004 986 994 969 955 962 998 998 Holyoke Phillips 1,816 1,912 1,933 1,954 2,009 2,092 2,082 2,125 2,182 2,060 Hooper Alamosa 76 74 72 72 71 71 75 75 82 90 Hot Sulphur Springs Grand 347 351 355 373 390 405 408 416 396 412 Hotchkiss Delta 672 696 733 763 815 849 881 899 971 1,051 Hudson Weld 623 628 638 853 882 698 712 727 752 818 Hugo lincoln 806 797 n5 754 755 ne 738 722 729 704 Idaho Springs Clear Creek 2 ,101 2,074 1,995 2,051 2,078 2,on 2,109 2,070 2,119 2,090 N Ignacio La Plata 654 656 659 887 667 667 703 739 746 733 VI l./1 Ill If Logan 204 209 210 210 211 218 205 190 201 207 Jamestown Boulder 218 218 221 224 224 223 234 247 239 239 Johnstown Weld 1,-403 1,-407 1,422 1,450 1,506 1,535 1,546 1,550 1,581 1,580 Julesburg Sedgwick 1,571 1,560 1,551 1,576 1,595 1,528 1,514 1,517 1,504 1,528 Keenesburg Weld 499 500 504 513 532 541 639 537 537 528 Keota Weld 5 5 5 5 4 4 4 2 2 2 Kersey Weld 691 722 758 802 864 913 903 889 949 963 Kim Las Animas 173 153 151 146 122 100 103 105 102 97 Kiowa Elbert 222 222 209 202 205 206 215 226 251 272 Kit Carson Cheyenne 246 253 242 259 273 278 263 284 275 270 Kremmling Grand 1,158 1,180 1,164 1,214 1,259 1,298 1,263 1,275 1,270 1,385 La Jara Conejos 835 822 642 846 846 858 840 834 838 823 La Junta Otero 8,596 8,613 8,445 8,323 8,294 8,338 8,382 8,343 8,385 8,230 La Salle Weld 1,598 1,636 1,688 1,752 1,858 1,929 1,919 1,898 1,928 1,846 La Veta Huerfano 611 624 622 629 618 611 626 672 705 705 Lafayette Boulder 6,252 6,653 7,319 7,928 8,480 8,985 9,786 10,685 11,751 12,634 Lake City Hinsdale 169 198 228 242 252 206 230 242 279 286 Lakeside Jefferson 19 19 19 20 20 19 18 17 16 15

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Coun!}: 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Greenwood Village Arapahoe 7,064 6,898 5,823 7,212 7 579 7,589 7,908 8,286 8,746 8 674 Grover Weld 148 142 142 139 138 135 137 139 140 141 Gunnison Gunnison 5,388 5,532 5,426 5,322 4,823 4,638 4,713 4,815 4,943 5,025 Gypsum Eagle 1,621 1,766 1,423 1,510 1,648 1,750 1,809 1,862 1,945 2,135 Hartman Prowera 124 120 117 117 112 106 107 107 109 110 Haswell Kiowa 85 80 76 70 65 62 67 68 84 84 Haxtun Phillips 928 936 935 925 965 952 991 1 008 984 990 Hayden Routt 1,549 1,480 1,469 1,443 1 439 1,444 1,455 1,425 1,568 1,520 HMirose Morgan 189 178 174 174 171 169 1n 184 190 190 Holly Prowers 988 958 939 950 907 an 885 856 868 880 Holyoke Phillips 2,058 2 ,074 2,063 2,027 1,956 1,931 2,026 2 065 2,025 2,036 Hooper Alamosa 93 98 101 106 1 11 112 114 116 115 116 Hot Sulphur Springs Grand 414 403 395 367 350 347 344 334 371 380 Hotchkiss Delta 1,045 993 739 766 755 744 n2 809 817 646 Hudaon Weld 653 651 874 896 918 918 942 959 971 981 Hugo Lincoln 713 684 669 678 675 660 705 705 750 757 Idaho Springs Clear Creek 2,116 2,114 1,934 1 904 1,878 1,634 1,782 1,885 1,960 2,035 N Ignacio La Plata 735 707 699 703 719 720 724 733 738 744 IJ1 0\ lliH Logan 201 189 182 162 1n 174 178 178 184 190 Jamestown Boulder 235 238 237 238 248 251 255 263 271 273 Johnstown Weld 1,598 1,569 1,578 1,581 1,580 1,579 1,614 1,836 1,855 1,880 Julesburg Sedgwick 1,438 1,359 1 344 1,343 1 316 1,295 1,266 1,284 1,208 1,269 Keenesburg Weld 546 549 555 560 565 570 596 605 618 638 Keota Weld 2 2 2 2 2 2 nd nd nd nd Kersey Weld 982 973 983 984 981 980 1,003 1 015 1,040 1 058 Klm Las Animas 93 88 87 83 79 76 78 76 74 75 Kiowa Elbert 287 282 286 294 283 275 290 284 338 352 Kk Carson Cheyenne 274 265 258 275 292 305 274 303 295 293 Kremmling Grand 1,403 1,366 1,312 1,236 1,173 1,166 1 ,157 1,126 1,244 1,280 La Jara Conejos 787 797 803 n8 749 725 692 710 738 739 La Junta Otero 8,250 8,143 7 900 7,885 7,740 7,637 7,634 7,896 7,858 7,876 La Salle Weld 1,855 1,814 1,809 1,802 1,792 1 ,783 1,661 1,855 1,872 1 ,884 La Veta Huerfano 741 753 744 768 735 726 684 679 741 n9 Lafayette Boulder 13,323 13,750 13,995 14,221 14,405 14,548 14,751 15,204 15,809 16,731 Lake City Hinsdale 232 227 244 233 232 223 209 225 237 299 Lakeside Jefferson 15 14 13 13 12 11 11 11 11 11

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Municipality 1995 1996 Greenwood Village Arapahoe 11,217 11,972 Grover Weld 142 142 Gunnison Gunnison 5,100 5,155 Gypsum Eagle 2,215 2,368 Hartman Prowera 111 112 Haswell Kiowa 82 83 Haxtun Phllllpa 1,011 1,017 Hayden Routt 1,589 1,605 Hillrose Morgan 188 260 Holly Prowera 891 899 Holyoke Phlllipa 2,008 2,092 Hooper Alamosa 119 122 Hot Sulphur Spring& Grand 401 418 Hotchkl&& Della 871 884 Hudson Weld 1,010 1,092 Hugo Uncoln 773 797 Idaho Spring& Clear Creek 2,064 2,043 N Ignacio La Plata 742 767 VI -.J Iliff Logan 195 196 Jamestown Boulder 276 277 Johnstown Weld 1,796 2,133 Julesburg Sedgwick 1,262 1,279 Keenesburg Weld 661 675 Keota Weld nd 0 Kersey Weld 1,079 1,077 Kim Las Animas 77 78 Kiowa Elbert 353 420 Kit Carson Cheyenne 290 293 Kremmling Grand 1,347 1,403 La Jara Conejos 757 766 La Junta Otero 8,037 8,074 La Salle Weld 1,892 1,864 La Veta Huerfano 797 608 Lafayette Boulder 17,500 18,855 Lake City Hinsdale 322 343 Lakeside Jefferson 11 11

PAGE 276

1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 Lakewood Jefferson 109,391 111,068 112,100 114,991 116,427 113,808 117,834 120,889 121,898 122,931 Lamar Prowers 8,061 8 ,047 7,981 7,826 7 ,903 7,713 7,794 8,031 8 ,547 8,734 Larkspur Douglas nd nd nd nd nd 141 151 162 161 160 La& Animas Bent 3,038 2,987 2,925 2,603 2,854 2,616 2,645 2,767 2,673 2,797 Leadville Lake 4,139 4,167 4,061 3,960 3,959 3,679 3,691 3,596 3,340 3,204 Limon Lincoln 1,699 1,874 1,618 1,763 1,760 1,805 1,748 1,737 1,n4 1,739 Littleton Arapahoe 28,375 28,257 28,141 28,805 28,871 28,631 30,813 32,384 32,693 31,639 Lochbule Weld 1 ,038 1,053 1,071 1,099 1,011 895 902 895 935 955 Log Lane VIllage Morgan 520 546 581 609 658 709 704 714 729 710 Lone Tree Archuleta nd nd nd nd nd nd nd nd nd nd Longmont Boulder 34,Q42 35,151 37,609 39,697 41,446 42,942 44,317 45,723 47,234 47,984 Louisville Boulder 4,040 4,261 4,650 5,000 5,311 5,593 5,934 8,282 6,621 6,260 Loveland Larimer 23,151 23,904 25,695 27,288 29,153 30,215 31,372 32,616 33,509 33,873 Lyons Boulder 1 ,122 1,108 1,135 1,147 1,148 1,137 1 '181 1,232 1,260 1,266 Manassa Conejos 904 893 918 925 931 945 962 987 1,032 1,058 Mancos Montezuma 790 791 604 815 881 870 935 1,002 1,005 966 ManHou Springs EIPaso 4 ,748 4,609 4,649 4,635 4,588 4,475 4,513 4,506 4,805 4,741 N Manzanola Otero 473 474 465 458 457 459 -453 440 -453 458 VI 00 Marble Gunnison 21 22 23 25 27 30 33 36 39 44 Mead Weld 276 288 299 315 338 356 359 380 371 415 Meeker Rio Blanco 1,795 1,808 1,851 2,008 2,251 2,356 2,551 2,640 2,656 2,314 Merino Logan 257 259 257 253 250 255 255 253 269 279 Milliken Weld 1,092 1,151 1 ,220 1 ,302 1,415 1,506 1,538 1,561 1,855 1,562 Minium Eagle 922 978 1,014 1,062 1,076 1,060 996 1,007 971 947 Moffat Saguache 107 108 108 112 105 105 104 102 111 111 Monte Vista Rio Grande 4,014 3,936 3,902 3,914 3,927 3,902 4,050 4,156 4,281 4,283 Montezuma Summit nd nd nd nd nd nd nd nd 38 42 Montrose Montrose 7,285 7,588 7,839 8,143 8,385 8,722 8,998 9,149 9,376 9,283 Monument El Paso 567 560 616 648 672 690 732 n4 832 898 Morrison Jefferson 492 494 492 498 497 478 491 503 504 504 Mountain View Jefferson 112 120 130 142 201 272 278 290 278 275 Mountain Village SanMiguel 714 697 674 880 634 584 600 615 609 603 MI. Crested Butte Gunnison nd nd nd nd ncl nd nd nd nd nd NaturHa Montrose 601 810 Btl 617 814 819 911 793 720 628 Nedef1ancl Boulder 856 908 995 1,075 1,147 1,212 1,285 1 ,333 1,333 1,309 NewCastle Garfield 548 544 549 551 569 563 588 642 643 572

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1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Lakewood Jefferson 124,472 125,289 125,130 125,051 125,668 126,481 128,676 130,838 134,314 134,311 Lamar Prowers 8,839 8,731 8,674 8,842 8,550 8,343 8,254 8,168 8,292 8,411 Larkspur Douglas 168 254 238 235 235 232 259 294 321 356 Las Animas Bent 2,739 2,767 2,638 2,650 2,553 2,481 2,439 2,449 2,645 2,666 Leadville Lake 3,056 2,882 2,695 2,539 2,602 2,629 2,881 2,740 2,787 2,838 Limon Lincoln 1,788 1,733 1,747 1,813 1,824 1,831 1,933 2,009 2,118 2,171 Littleton Arapahoe 32,159 32,620 33,454 33,283 33,338 33,885 34,704 35,746 36,401 36,930 Lochbule Weld 1,063 1,066 1,094 1,130 1,152 1,188 1,192 1,204 1,213 1,221 Log Lane Village MOJgan 694 654 644 637 675 667 696 723 748 706 Lone Tree Archuleta nd nd nd nd nd nd nd nd nd nd Longmont Boulder 47,855 46,297 49,348 50,445 51,066 51,555 51,843 52,929 55,010 55,796 Louisville Boulder 9,631 10,093 10,566 11,153 1t,n3 12,361 13,512 14,456 16,158 16,889 Loveland Larimer 35,094 35,871 36,259 36,484 36,952 37,352 38,373 39,440 40,628 41,802 Lyons Boulder 1,261 1,237 1,216 1,219 1,225 1,227 1,230 1,251 1,291 1,364 Manassa Conejos 938 979 1,017 1,007 996 988 945 967 1,001 1,001 Mancos Montezuma 921 887 843 830 837 842 841 872 940 982 Manitou Springs EIPaso 4,834 4,m 4,761 4,665 4,592 4,535 4,575 4,740 4,949 4,949 N Manzanola otero 460 456 451 452 442 437 433 448 444 446 Vl \() Marble Gunnison 47 51 55 56 64 64 66 69 70 72 Mead Weld 431 430 442 447 452 456 469 484 498 527 Meeker Rio Blanco 2,131 2,047 2,246 2,201 2,143 2,098 2,163 2,205 2,318 2,322 Merino Logan 281 272 270 251 238 238 244 245 228 228 Milliken Weld 1,610 1,586 1,593 1,802 1,805 1,805 1,641 1,681 1,6n 1,891 Minturn Eagle 942 1,189 1,149 1,116 1,098 1,066 1,094 1,107 1,134 1,133 Moffat Saguache 109 109 109 101 104 99 106 107 108 109 Monte Vista Rio Grande 4,338 4,480 4,431 4,456 4,364 4,324 4,498 4,621 4,546 4,569 Montezuma Summit 47 50 50 52 58 60 61 62 64 69 Montrose Montrose 9,109 8,884 8,826 8,844 8,858 8,854 9,296 9,886 10,130 10,554 Monument EIPaso 952 9n 1,008 1,022 1,022 1,020 1,029 1,064 1,110 1,177 Morrison Jefferson 506 492 485 474 471 465 471 476 484 481 Mountain View Jefferson 274 278 269 266 272 264 345 348 352 359 Mountain Village San Miguel 604 586 570 562 555 550 556 563 567 563 Mt. Crested Butte Gunnison nd nd nd nd nd nd nd nd nd nd Naturita Montrose 570 527 501 479 456 434 449 461 484 471 Nederland Boulder 1,288 1,223 1,173 1,154 1,123 1,099 1,108 1,143 1,181 1,202 New Castle Garfield 467 601 602 621 647 679 717 737 791 1,056

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Municipality 1995 1996 Lakewood Jefferson 135,243 137,687 Lamar Prowera 8,483 8,563 Larkspur Douglas 401 479 Las Animas Bent 2,734 2,812 Leadville Lake 3,075 3,262 Limon Lincoln 2,207 2,269 Lmleton Arapahoe 38,057 38,968 Lochbule Weld 1,226 1,230 Log Lane Village Morgan 823 836 Lone Tree Archuleta nd 4,028 Longmont Boulder 56,894 58,592 Louisville Boulder 17,438 17,757 Loveland LartiT18f 43,270 44,467 Lyons Boulder 1,423 1,432 Manaaaa Conejos 1,015 1,024 Mancos Montezuma 993 994 Manitou Springs El Paso 5,106 5,165 N Manzanola otero 453 453 0\ 0 Marble Gunnison 75 78 Mead Weld 551 818 Meeker Rio Blanco 2,401 2,406 Merino Logan 231 230 Weld 1,745 1,790 Minturn Eagle 1,107 1,099 Moffat Saguache 114 116 Monte Vlata Rio Grande 4,668 4,662 Montezuma Summit 68 72 Montrose Montrose 11,144 11,810 Monument EIPaao 1,219 1,247 Morrison Jefferson 483 533 Mountain View Jefferson 381 381 Mountain Village San Miguel 562 556 Mt. Created Butte Gunnison 545 559 Naturita Montrose 4n 478 Nedefland Boulder 1,234 1,261 NewCastle Garfield 1,276 1,446

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Munlciealitl Countl 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 Notthglenn Adams 29,377 29,543 29,356 30,433 30,555 29,847 29,827 29,948 29,911 29,902 Norwood San Miguel 436 466 463 467 446 478 466 437 420 424 Nucla Montrose 960 979 989 1,004 1,011 1,027 1,021 993 911 801 Nunn Weld 294 290 288 289 295 295 292 288 298 302 Oak Creek Routt 690 731 766 838 910 929 876 828 798 785 Olathe Montrose 952 1,013 1,068 1,133 1,190 1,262 1,284 1,279 1,315 1,304 Olney Springs Crowley 281 271 266 249 239 253 248 241 231 204 Ophir San Miguel 18 22 26 29 32 38 41 42 43 47 Orchard City Dena 1,641 1,718 1,828 1,840 1,900 1,914 2,056 2,155 2,210 2,282 Ordway Crowley 1,173 1,145 1,144 1,084 1,056 1,135 1,049 967 942 835 Otis Washington 500 510 491 480 487 534 514 521 547 553 Ouray Ouray 758 797 755 754 731 684 707 703 697 714 Ovid Sedgwick 458 452 448 455 459 439 438 441 421 411 Pagosa Springs Archuleta 1,413 1,378 1,386 1,391 1,428 1,331 1,477 1,562 1,389 1,328 Palisade Mesa 1,013 1,019 1,045 1,183 1,370 1,551 1,633 1,723 1,797 1,761 Palmer Lake El Paso 1,117 1,099 1,123 1,136 1,141 1,130 1,163 1,188 1,198 1,218 Paoli Phillips 64 69 71 73 n 81 73 70 70 64 N Paonia Delta 1,271 1,267 1,285 1,318 1,387 1,425 1,530 1,622 1,690 1,772 0\ Parachute Garfield 356 364 361 367 361 338 606 950 668 736 Parker Douglas nd nd nd nd nd 290 317 348 392 434 Peetz Logan 202 207 209 210 212 220 209 195 201 202 Pierce Weld 663 692 727 no 631 878 668 894 905 855 Pitkin Gunnison 53 51 52 53 55 59 56 54 52 51 Platteville Weld 1,149 1,225 1,312 1,413 1,549 1,662 1,652 1,644 1,702 1,617 Poncha Springs Chaffee 263 269 285 293 310 321 325 322 311 298 PrHchett Baca 179 184 180 182 182 183 178 176 183 182 Prospect Heights Fremont 38 37 36 35 35 34 33 31 29 27 Pueblo Pueblo 102,558 101,715 100,804 100,532 101,903 101,688 100,634 99,616 99,291 98,360 Ramah EIPaso 118 116 119 120 120 119 124 128 120 114 Rangely Rio Blanco 1,810 1,827 1,674 1 954 2,104 2,113 2,375 2,575 2,774 2,596 Raymer Weld 77 76 76 77 79 80 83 87 90 61 Red Cliff Eagle 603 569 560 529 477 409 372 356 341 329 Rico Dolores 169 148 121 107 88 76 82 88 69 82 Ridgway Ouray 328 360 356 371 377 389 398 415 420 436 RiHe Garfield 2,264 2,263 2,267 2,539 2,919 3,215 3,943 5,031 4,716 3,916 Rockvale Fremont 369 358 349 343 350 338 345 352 358 350

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1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Northglenn Adams 29,592 28,479 28,448 28,030 27,567 27,195 27,651 28,101 28,063 28,176 NOIWOOCI San Miguel 449 447 440 445 439 429 424 423 510 500 Nucla Montrose 732 697 682 674 668 656 679 699 704 717 Nunn Weld 308 305 315 319 322 324 331 334 339 344 Oak Creek Routt 741 704 696 678 676 673 678 650 715 740 Olathe Montrose 1,278 1,242 1,245 1,257 1,262 1,263 1,310 1,346 1,352 1,448 Olney Springs Crowley 202 200 295 326 335 340 344 357 355 364 Ophir San Miguel 54 56 61 67 69 69 68 68 82 92 Orchard City Della 2 ,260 2,199 2,169 2,188 2,207 2,218 2,309 2,420 2,435 2,586 Ordway Crowley 804 743 712 1,161 1,086 1,025 1,038 1,076 1,075 1,100 Otis Washington 538 511 503 494 471 451 499 502 498 496 Ouray Ouray 674 620 649 654 648 644 679 723 709 760 Ovid Sedgwick 381 362 361 362 355 348 341 337 323 340 Pagosa Springs Archuleta 1,311 1,299 1,240 1,164 1,164 1,207 1,229 1,254 1,347 1,395 Palisade Mesa 1,656 1,627 1,674 1,755 1,799 1,871 1,946 1,988 2,000 2,086 Palmer lake EIPaso 1,248 1,534 1,548 1,515 1,490 1,480 1,491 1,548 1,605 1,703 Paoli Phil Ups 60 54 48 41 34 29 30 31 44 44 N Paonia Delta 1,762 1,681 1 ,471 1,444 1,418 1,403 1,482 1,531 1,558 1,599 0\ Parachute Garfield 748 719 678 665 664 658 674 665 658 1,063 N Parker Douglas 476 2,354 2,615 3,017 5,321 5,450 6,000 6,657 8,419 9,835 peetz Logan 196 165 180 183 160 179 185 186 172 172 Pierce Weld 856 839 835 833 826 823 843 853 857 869 Pitkin Gunnison 48 47 48 50 54 53 75 94 115 143 Platteville Weld 1,657 1,598 1,575 1,548 1,542 1,515 1,547 1,570 1,562 1,815 Poncha Springs Chaffee 282 276 265 251 248 244 251 255 268 271 Pritchett Bace 178 164 161 163 158 153 148 148 144 148 Prospect Heights Fremont 25 24 22 21 20 19 19 19 21 21 Pueblo Pueblo 97,910 98,398 98,558 99,170 98,611 98,640 100,984 101,038 100,548 100,700 Ramah EIPaso 113 108 105 101 97 94 94 97 100 103 Rangely Rio Blanco 2,520 2,509 2,513 2,438 2,346 2,278 2,348 2,401 2,537 2,557 Raymer Weld 82 97 97 100 99 98 100 101 102 103 Red Cliff Eagle 319 313 306 299 299 297 298 295 302 302 Rico Dolores 67 87 67 96 92 92 85 82 114 126 Ridgway Ouray 425 392 412 413 425 423 451 462 473 524 Rifle Garfield 4,153 4,310 4,283 4,418 4,568 4,636 4,806 4,987 4,980 5,101 Rockvale Fremont 346 330 330 333 324 321 312 316 350 364

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Municipality 1995 1996 Northglenn Adams 28,210 28,664 NOfWOOd San Miguel 548 578 Nucla Montroaa 723 729 Nunn Weld 348 362 Oak Creek Routt 765 ne Olathe Montrose 1,489 1,524 Olney Springs Crowley 370 382 Ophir SanMiguel 102 107 Orchard City Della 2,663 2,704 Ordway Crowley 1,117 1,151 Otis Washington 500 502 Ouray Ouray 804 838 Ovid Sedgwick 338 343 Pago&a Springs Archuleta 1,461 1,648 Palisade Mesa 2,182 2,273 Palmer Lake El Paso 1,758 1,n8 Paoli Phillips 45 46 N Paonia Della 1,658 1,691 0\ VJ Parachute Garfield 1,092 1,100 Parker Douglas 11,838 13,231 Peetz Logan 1n 178 Pierce Weld 881 897 Pitkin Gunnison 175 204 Pleltevllle Weld 1,885 1,937 Poncha Springs Chaffee 283 292 Pritchett Baca 147 150 Prospect Heights Fremont 21 21 Pueblo Pueblo 101,252 101,402 Ramah EIPaso 104 102 Rangely Rio Blanco 2,849 2,666 Raymer Weld 106 108 Red Cliff Eagle 295 297 Rico Dolo( as 138 152 Ridgway Ouray 555 588 Rille Garfield 5,698 5,847 Rockvale Fremont 373 378

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1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 Rocky Ford ot.,.-o 5,019 5,016 4,905 4,621 4,791 4,604 4,769 4,750 4,704 4,572 Romeo co.lejos 339 326 325 319 312 308 303 304 320 382 Rosedale We.d 57 53 49 45 42 38 37 35 46 45 Rye Pueblo 225 225 224 226 231 232 220 210 210 207 Saguache Saguache 665 674 675 706 659 656 656 649 661 630 Salida Chaffee 4,790 4,725 4,823 4,785 4,872 4,870 5,013 4,966 4,895 4,759 San Lull Costilla 620 624 644 675 858 842 636 852 886 673 Sanford Conejos 661 668 681 682 681 687 696 712 733 742 Sawplt San Miguel 32 35 38 37 37 41 40 37 38 38 Sedgwick Sedgwick 238 240 245 2!)5 263 258 242 226 224 227 Seibert Kit Carson 168 189 166 160 181 160 185 192 168 181 Severance Weld 81 84 87 91 97 102 106 111 118 113 Shefldan Arapahoe 5,215 5,215 5,217 5,368 5,411 5,3n 5,398 5,281 5,672 5,805 Sheridan Lake Kiowa 90 89 83 79 83 87 92 88 68 91 Silt Garfield 739 797 868 881 920 923 998 1,140 1,187 1,099 Silver Cliff Custer 172 168 203 229 274 280 288 306 333 356 Silver Plume Clear Creek 160 155 146 146 144 140 144 142 145 141 N Silverthorne Summit 769 823 892 954 990 989 1,028 1,109 1,198 1,461 Silverton San Juan 604 814 846 912 811 794 937 1,108 9n 890 Simla Elbert 467 4n 458 455 476 494 499 511 525 522 Snowmass Village Pitkin nd nd nd 438 722 999 973 1,003 1,080 1,203 South Fork Rio Grande nd nd nd nd nd nd nd nd nd nd Springfield Baca 1,883 1,711 1,668 1,671 1,664 1,857 1,841 1,819 1,609 1,546 Starkville Las Animas 149 146 140 133 128 127 133 138 129 117 Steamboat Springs Routt 3,561 3,832 4,081 4,507 4,947 5,098 5,298 5,608 5,608 6,137 Sterling Logan 10,961 11,145 11 '151 11,090 11,061 11,385 11,466 11,499 11,611 11,397 Stratton Kit Carson 757 756 740 712 713 705 881 664 687 694 Sugar City Crowley 334 322 319 299 288 306 299 295 302 281 Superior Boulder 202 201 206 209 209 208 214 218 235 249 Swink Otero 546 578 595 613 638 668 673 679 675 859 Telluride SanMiguel 743 833 869 922 926 1,047 1,031 963 941 961 Thornton Adams 25,566 28,312 30,832 34,884 38,091 40,343 44,215 46,889 48,194 49,557 Timnath Larimer 194 189 191 191 191 185 184 181 193 191 Trinidad Las Animas 9,985 10,011 9,687 9,620 9,452 9,883 9,no 9,768 9,719 9,410 Two Buttes Baca 112 108 100 95 90 84 81 79 75 89 Vall Eagle 1,760 2,126 2,491 2,915 3,276 3,555 3,587 3,920 3,780 3,883

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1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Rocky Ford Otero 4,542 4,482 4,348 4,317 4,223 4,162 4,136 4,286 4,254 4,276 Romeo Conejos 384 388 390 372 354 341 326 334 354 373 Rosedale Weld 48 44 nd nd nd nd nd nd nd nd Rye Pueblo 201 194 186 183 176 168 172 171 171 170 Saguache Saguache 613 624 635 605 598 584 627 632 633 636 Salida Chaffee 4,584 4,644 4,658 4,575 4,6n 4,737 4,923 4,994 5,214 5,292 San Luis Costilla 893 867 864 867 831 800 762 801 820 823 Sanford Conejos 731 758 784 no 759 750 717 734 762 763 Sawpll San Miguel 40 39 39 39 36 36 39 36 48 48 Sedgwick Sedgwick 207 195 193 192 187 183 180 179 172 181 Seibert Kit Carson 175 172 194 191 182 181 178 180 195 181 Severance Weld 113 109 108 107 106 106 108 105 106 124 Sheridan Arapahoe 5,855 5,864 5,450 5,288 5,045 4,976 5,117 5,258 5,320 5,327 Sheridan Lake Kiowa 87 89 93 94 93 95 103 104 100 100 Sill Garfield 1,048 1,030 1,010 1,042 1,074 1,095 1,142 1,130 1,145 1,173 Sliver Clilf Custer 386 379 368 344 332 322 347 388 392 392 Sliver Plume Clear Creek 143 148 139 135 135 134 125 132 142 151 N Silverthorne Summit 1,587 1,671 1,636 1,680 1,745 1,768 1,818 1,919 2,061 2,474 0\ V1 Silverton San Juan 743 734 790 728 717 716 714 569 505 525 Simla Elbert 527 510 515 525 497 481 511 505 531 553 Snowmaas Village Pitkin 1,297 1,368 1,378 1,368 1,423 1,449 1,468 1,494 1,544 1,585 South Fork Rio Grande nd nd nd nd nd nd nd 390 383 402 Springfield Baca 1,486 1,414 1,424 1,494 1,481 1,475 1,405 1,403 1,369 1,405 Starkville Las Animas 112 110 111 109 106 104 104 101 97 97 Steamboat Springs Routt 6,268 6,264 6,287 6,280 6,418 6,695 6,749 6,827 7,517 7,981 Sterling Logan 11,265 10,733 10,473 10,590 10,484 10,362 10,590 10,625 10,475 11,089 Stratton Kit Carson 663 651 644 658 653 649 638 636 626 655 Sugar City Crowley 284 270 258 270 260 252 255 263 261 267 Superior Boulder 252 251 250 251 255 255 310 680 1,253 2,054 Swink Otero 658 644 621 613 596 584 578 800 600 605 Telluride SanM;guel 1,030 1,212 1,257 1,279 1,302 1,309 1,314 1,186 1,360 1,878 Thornton Adams 51,703 53,240 54,665 55,287 55,198 55,031 58,216 57,580 58,672 60,620 Timnath Larimer 190 189 186 187 188 190 197 201 206 214 Trinidad Las Animas s.on 6,930 9,061 6,916 6,737 6,580 6,643 6,486 9,090 9,390 Two Buttes Baca 65 72 70 71 66 83 60 60 59 59 Vall Eagle 3,789 2,362 3,702 3,638 3,693 3,659 3,737 3,781 3,866 4,412

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Municipality 1995 1996 Rocky FOI'd Otero 4,342 4,356 Romeo Conejos 378 381 Rosedale Weld nd 0 Rye Pueblo 170 168 Saguache Saguache 672 673 Salida Chaffee 5,515 5,696 San Lula CO&Illla 850 864 SanfOI'd Conejos 774 781 SawpM San Miguel 43 44 Sedgwick Sedgwick 180 182 Seibert Kit caraon 184 181 Severance Weld 149 238 Sheridan Arapahoe 5,257 5,262 Sheridan Lake Kiowa 98 100 Silt Garfield 1,239 1,283 Silver Cliff Custer 415 441 Silver Plume Clear Creek 190 168 N Silverthorne Summit 2,804 2,947 0\ 0\ Silverton SanJuan 529 536 Simla Elbert 555 627 Snowman VIllage Pitkin 1,587 1,581 South Fork Rio Grande 411 438 Springfield Baca 1,420 1,459 Starkville LaaAnlmaa 100 101 Steamboat Springs Routt 8,241 8,400 Sterling Logan 11,290 11,386 Stratton Kit Carson 658 659 Sugar City Crowley 271 280 Superior Boulder 2,576 3,961 Swink Otero 616 623 Telluride SanMiguel 1,803 1,661 Thornton Adama 83,372 65,783 Timnath Larimer 219 224 Trinidad LaaAnlmaa 9,542 9,708 Two Buttes Bac;a 59 60 Vall Eagle 4,354 4,372

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1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 Victor Teller 320 308 297 293 296 265 272 280 2n 264 Vilas Baca 102 108 109 tt2 tt5 tt8 tt6 114 tt8 tt7 Vona Kit Carson 105 104 101 97 96 94 97 102 109 113 Walden Jackson 870 863 851 913 899 947 1,041 1,069 955 955 Walsenburg Huerfano 4,208 4,244 4,178 4,171 4,045 3,945 3,811 3,852 3,920 3,803 Walsh Baca 949 954 920 912 898 884 859 839 828 792 Ward Boulder 78 86 98 109 tt9 129 128 124 125 126 Wellington Larimer 957 983 1,050 1,109 1,179 1,215 1,266 1,325 1,413 1,284 Westcliffe Custer 250 257 268 289 331 324 314 312 338 363 Westminster Adams 31,300 34,403 37,814 41,582 45,682 50,211 53,228 58,570 29,911 62,697 Wheal Ridge Jefferson 32,497 32,380 32,027 32,145 31,790 30,293 30,861 31,074 30,844 30,622 Wiggins Morgan 519 511 510 503 515 531 530 538 542 522 Wley Prowera 407 413 416 417 428 425 411 403 440 459 Williamsburg Fremont 78 76 74 73 74 72 76 81 86 87 Windsor Weld 2,839 3,057 3,303 3,588 3,960 4,2n 4,422 4,587 4,747 4,681 Winter Park Grand nd nd nd 458 471 480 515 561 565 622 Woodland Park Teller 1,638 1,939 2,082 2,268 2,571 2,634 2,787 2,948 3,241 3,665 N Wray Yuma 1,963 1,979 2,047 2,031 2,125 2,131 2,191 2,281 2,274 2,215 0\ -.J Yampa Routt 316 316 311 366 431 472 446 429 401 382 Yuma Yuma 2,433 2,486 2,607 2,621 2,n9 2,824 2,863 2,926 2,980 2,986 Total Municipal Population 1,923,213 1,953,252 1,992,638 2,052,956 2,108,996 2,135,417 2,195,631 2,249,374 2,268,187 2,327,304

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1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Victor Teler 257 256 281 268 262 258 274 276 288 370 Vilas Baca 115 107 108 111 107 105 101 101 100 101 Vona Kit Carson 113 110 108 107 105 104 102 103 101 106 Walden Jackson 928 920 960 929 913 890 886 842 937 949 Wal&enburg Huerta no 3,842 3,783 3,614 3,447 3,381 3,300 3,109 3,144 3,672 3,700 Walsh Baca 758 706 700 724 705 692 667 669 668 882 Ward Boulder 122 122 122 140 158 159 161 184 167 168 Wellington Larimer 1,284 1,272 1,314 1,306 1,324 1,340 1,3n 1,417 1,452 1,495 Westcliffe Custer 383 371 352 329 326 312 338 377 382 381 Westminster Adams 65,221 68,384 71,959 73,153 73,995 74,625 76,681 78,864 81,123 84,887 Wheat Ridge Jefferson 30,540 30,381 29,818 29,565 29,552 29,419 29,751 30,280 31,205 31,029 Wlgglna Morgan 508 488 487 491 499 499 524 544 591 595 Wiley Prowera 459 445 436 442 421 406 402 398 l5 410 Williamsburg Fremont 90 242 244 251 251 253 249 355 459 625 Windsor Weld 4,853 4,938 4,983 5,023 5,051 5,062 5,256 5,396 5,605 5,937 Winter Park Grand 651 630 601 564 541 528 516 493 549 562 Woodland Park Teller 3,960 4,195 4,506 4,600 4,615 4,610 4,681 4,957 5,173 5,465 N Wray Yuma 2 ,202 2,137 2,105 2,127 2,056 1 998 2,018 1,970 2,012 2,030 0\ (X) Yampa Routt 355 336 330 321 318 317 317 304 333 347 Yuma Yuma 2,956 2,885 2,847 2,893 2,793 2,719 2,733 2,672 2,849 2,882 Total Municipal Population 2,358,490 2,380,877 2,392,012 2,390,569 2,395,862 2,396,033 2,451,509 2,512,228 2,570,195 2,619,948

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Municipality 1995 1996 Victor Teller 401 430 Vllaa Baca 102 104 Von a Kit Carson 106 106 Walden Jackson 938 935 Walsenburg Huet1ano 3,785 3,858 Walsh Baca 695 717 Ward Boulder 168 168 Wellington Larimer 1,526 1,550 Westcliffe Custer 403 428 Westminster Adams 89,105 92,920 Wheal Ridge Jefferson 31,007 30,808 Wiggins Morgan 610 673 Wiley Prowera 413 416 Williamsburg Fremont 789 808 Windsor Weld 6,384 7,034 Winter Park Grand 581 596 Woodland Park Teller 5,982 6,510 N Wray Yuma 2,072 2,083 0\ \() Yampa Routt 359 368 Yuma Yuma 2,940 2,971 Total Municipal Population 2,679,212 2,734,412

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APPENDIXE DATA ASSUMPTIONS AND MUNICIP ALmES EXCLUDED FROM STUDY All of the data on municipal revenues and expenditures used in this study was extracted from the Colorado Economic Demographic and Information System (CEDIS) database as maintained by the Department of Local Affairs. The data was initially extracted for all 2 72 municipalities contained in the database as legally incorporated municipalities. For each municipality, the data was categorized into eleven revenue and fourteen expenditure categories. The reported data for each of these categories for each of 22 years (1975 through 1996) was extracted. Thus, in total, almost 150,000 observations were extracted from the system (2 72 municipalities x 22 years x 25 categories = 149,600 observations). Within the extracted data, there were no blank spaces or other notations of missing or not reported data. All expected observations were recorded by some number. Despite the entry of at least a zero for each 270

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expected observation, it seems very probable and plausible that some of the zeroes represent missing data and others are actually a reported zero. Seventeen of the towns that are known to have either been incorporated some years after 1975, or to have lost all their population prior to 1996, were eliminated from the study. They are listed in Table E.l, below, with a fuller explanation of the reason for their elimination. (In the table, the phrase "no data" refers to zeroes.) Table E.l Municipalities Eliminated from the Study Municipality Brookside Foxfield Keota Lakeside Lone Tree County Fremont Arapahoe Weld Jefferson Douglas Reason for Exclusion No data for 1975 through 1983. The population estimated for 1996 was 222. Incorporated December 15, 1994. No previous data. No data for 1989 through 1995. CEDIS has no community profile. Keota is a small town located in a remote, rural area of the Pawnee National Grassland. Town government appears to have simply ceased to exist. No data for 1975 through 1981. Lakeside imposes no taxes and has a population of 11 or 12. It is a small enctave in the Denver metropolitan area. Incorporated in 1996. No data from 1975 through 1995. 271

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County Reason for Exdusion Montezuma Summit No data from 1975 through 1984. Montezuma is a former silver mining town at 10,400 feet elevation on the continental divide. Population was estimated to be 72 in 1996. Mt. Crested Butte Gunnison No data from 1975 through 1994. Incorporated in 1995, Mt. Crested Butte has an estimated 1996 population of 361. Ophir San Miguel No data from 1975 through 1986. Ophir is a former mining camp in the mountains with a town government that has come and gone more than once. The estimated 1996 population was 1 07. Orchard City Delta No data from 1975 through 1982. Although incorporated in 1912, town government was inactive for many years. Population estimated for 1996 was 2, 704. Parker Douglas Parker was not incorporated unti11981 and no data is available from 1975 through 1980. The 1996 estimated population was 13,231. Pitkin Gunnison Although Pitkin was incorporated in 1879 {making it the oldest town in Colorado west of the Continental Divide), town government has been a dive only sporadically. No data for 1975, 1977-1981, 1984-1985, and 1991. The 1996 population was estimated to be 204. Prospect Heights Fremont No data for 1975 through 1995. The 1996 population estimate was 21. Rosedale Weld No data for 1987 through 1995. No population estimate is available. The town government may have ceased to function for this rural, prairie community. Sanford Conejos No data from 1978 through 1984. Sanford is a small farming community with an estimated 1996 population of 781. Snowmass Village Pitkin Although incorporated in 1977, no data is available prior to 1982. The estimated population in 1996 was 1,561. 272

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Municipality South Fork Starkville County Rio Grande Las Animas Reason for Exclusion No data from 1975 through 1991. Recently incorporated, South Fork has an estimated 1996 year-round population of 436. Incorporated in 1955, town government was inactive, and no data is available, from 1981 through 1988. The 1996 estimated population was 101. Despite elimination of these governments from the study, there remain zeroes within the data in drcumstances that suggest they probably represent missing data rather than actually reported zeroes. There are also many more zeroes that probably are actually reported zeroes. The number of zeroes varies among the dependent variables. After elimination of the seventeen governments listed above, each dependent revenue or expenditure variable contains 5,610 observations. Table E.2, below, reports the count and the percentage of zeroes (whether plausibly actual zeroes or more plausibly missing data) for each revenue and expenditure variable used in the study. 273

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Table E.2 Reponed Zeroes for Each Dependent Variable (N = 5,610 for each) Dependent Variable Reoorted Zeroes CCountl Reoorted Zeroes C%l I Total Revenue 193 3.4 I Total Tax Revenue 218 3.9 Sales Tax Revenue 1,733 30.9 Property Tax Revenue 376 6.7 Charges for Service 1,468 26.2 Fines and ForfeitS 1,456 26.0 Licenses and PennitS 552 9.8 Miscellaneous Revenue 245 4.4 Specific Ownership Tax 641 11.4 Revenue from State 290 5.2 Transfer in from Enterprises 4,025 71.7 Total Operating Expenditures 215 3.8 General Government 240 4.3 Judicial 3,867 68.9 Law Enforcement and Jail 1,654 29.5 Fire Protection 3,375 60.2 Roads and Highways 490 8.7 I Solid Waste Services 3,321 59.2 Other Public Works 4,745 84.6 Health 2,750 49.0 Culture and Recreation 971 17.3 Miscellaneous Expenditures 3,556 63.4 Transfers to Enterprises 3,304 56.9 Capital Outlays 1,073 19.1 General Activity Debt Service 3,401 60.6 274

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The decision to retain the zeroes or treat them as missing data has consequences for this study and for the statistical calculations of the model employed. The first consequence arises from the fact that it is impractical to make an individual decision as to whether any particular zero is more plausibly missing data or a reported nullity. There are simply too many of them and not enough information to make informed decisions. Any attempt to make individual decisions would make any future replication of the study impossible. However, once it has been decided that all have to be treated alike, other consequences arise. If the zeroes are eliminated, the pooled, cross section design of the model requires all the cross-sections (one for each municipality} to have an equal number of observations. Thus, it requires that all22 years of observations for any town with even one zero be eliminated from the calculations for the particular variable involved. This constraint means that many municipalities would be lost to the study. As an example, in the case of total revenue, there are only 3.4 percent zeroes among the 5,610 observations, but elimination of all the zeroes results in the loss of92 of the 255 municipal governments (36 percent) in the study. 275

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For the sales tax revenue variable, there are 30.9 percent zeroes. Their elimination results in the loss of 170 of the governments (67 percent) in the study. On the other hand, retention of all the zeroes has implications for the calculated results obtained. To assess the difference between using the model, as it has been employed in the study with zeroes, and using it after eliminating all towns with a zero observation, the two methods were compared for the total revenue, total tax revenue, sales tax revenue, and property tax revenue variables. The results of this comparison are reported in Table E.3, below. 276

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Table E.3 of Regression Results between All Munidgalities and Municigalities without Zero Data Observations Wdhzeroes Without zeroes Wdhzeroes Without zeroes Total Revenue Total Tax Revenue Trend coefftcaent 0.081331 0.041190 0.080652 0.049933 T-ratio 10.75 14.03 14.10 23.85 p 0.000 0.000 0.000 0.000 Gallagher coefficient .0.045914 .0.034090 .0.036546 .0. 028559 T-ratio -3.268 -8.534 -3.436 .7'ST p 0.001 0.000 0.001 0.000 TABOR coefficient ..0.022191 0.017034 .0. 052476 .0. 017089 T-ratio .0.9462 1.8750 -2.9450 .8570 p 0.344 0 061 0.003 0.004 R2 0.5238 0.8858 0.6822 0.9394 N= 5,610 3,588 5.610 3,542 tl municipalities 255 163 255 161 Trend% 8.13 4 .12 8.07 4.99 Gallagher 'l6 -4.59 -3.41 -3.65 -2.86 TABOR 'l6 -2.22 1.70 -5.25 .71 Post-GaJlagher 1ft 3.54 0.71 4 .41 2.14 PostTABOR 1ft 1 .32 2.41 .0.84 0 .43 Property Tax Sales Tax Trend coefficient 0.005139 .0.008039 0.14034 0.079571 T -ratio 0.4228 -2.314 26.21 14.05 p 0.672 0.021 0.000 0.000 Gallagher coefficient 0.058788 0.032122 .0.056413 .0.061061 T -ratio 2.572 4 .914 -5.679 -6.111 p 0.010 0.000 0 000 0.000 TABOR coefficient .0.15589 .0.083938 .0.066570 0.022235 T-ratio -3.873 -7 .226 -3.739 1 .286 p 0 .000 0.000 0.000 0 198 R2 0.5155 0 8721 0 8163 0 8979 N= 5,610 2,948 5,610 1,870 tl municipalities 255 134 255 85 Trend 'l6 0.51 .0.80 14.03 7 .96 Gallagher 'l6 5.88 3.21 -5.64 -6.11 TABOR 'l6 -15.59 -8 39 -6.66 2.22 Post-Gallagher 1ft 6.39 2.41 8.39 1 .85 Post-TABOR% .20 -5.99 1.74 4.07 277

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This comparison shows that retaining all the zeroes causes the R2 to drop considerably for those variables with a relatively few zeroes (total revenue, total tax revenue, and property tax) and less so for those with a large number of zeroes (sales tax). As was expected, for those variables with relatively few zeroes, more observations and municipalities remain in the model than for variables with many zeroes. Most importantly, the trends shown before Gallagher, during the Gallagher period, and after TABOR, are generally similar under either scenario. The trends before either TEL amendment were highest. After Gallagher, the trends were reduced somewhat for all the variables except property tax. For property tax, the trends after Gallagher were higher than before. Finally, the trends after the TABOR amendment were ac their lowest value. With these similarities in the trends under either method-retaining zeroes or omitting them-it was decided to retain them for several advantages. The main advantage being that all255 municipal governments remain in the study for all the variables. This allows comparison of the results among the different dependent variables. This ability to make 278

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comparisons would be lost if there were different municipalities and a different number of municipalities in each variable regression. Secondly, retaining the zeroes avoids the loss of many towns for which the zeroes are most probably actual, reponed null values. In the instance of the sales tax variable, the two--thirds of municipal governments that otherwise would be eliminated are overwhelmingly small towns. Several of these very likely did not have a sales tax for some years at the beginning of the study period, but adopted it in later years. For example, Akron did not have a sales tax for 1975-80, but adopted it for 1981 and subsequently. The adoption of a sales tax during the study period surely causes the growth rate for this variable to be increased and should properly be reported in a study such as this. Finally, if error must be introduced by either retaining all the zeroes or eliminating all of them, it seems that retaining them results in the lower degree of error because there appear to be many more actually reported zeroes than there are zeroes that likely represent missing data. Again, the sales tax revenue variable provides an example. The pattern of zeroes suggests that most of them arise from towns that did not have such a tax for 279

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several years and then adopted it and thereafter, consistently report such revenues. This decision to retain all the zeroes and the apparent sensitivity of the model to their presence should be held in mind as the reader examines the reported results. 280

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APPENDIXF INFLATION INDICES U.S. Denver-Boulder Year Inflation Rate Inflation Rate Adjustment Factor 1975 9.1 10.3 1. 1976 5.8 5.6 0.940594744 1977 6.5 8.4 0.883487788 1978 7 7 9.4 0.828218244 1979 11. 3 15.5 0. 759365753 1980 13. 5 12.0 0.683765124 1981 10.4 11.2 0.622471396 1982 6.1 9.1 0.583500172 1983 3.2 5.7 0.557806669 1984 4.3 3.8 0 534112627 1985 3.6 2.7 0.513142009 1986 1 9 0.7 0.500183878 1987 3 7 2.7 0.479905437 1988 4 1 2.6 0.466202783 1989 4.8 1.8 0 450787162 1990 5.4 4.4 0.429894431 1991 4.2 3.9 0.418492308 1992 3 0 3.7 0.40803 1993 3.0 4.2 0.399531955 1994 2 6 4.4 0.393771533 1995 2.8 4.3 0.382268899 1996 2 9 3.5 0 371510516 Source. U .S. Data from U S. Bureau of Labor Statistics, , May 27. 1997 Series 10: CUUROOOOSO, Not seasonally adjusted, U.S. City Average, All items, Base Period: 1982-1984=100. The Denver-Boulder data were obtained from the Colorado Legislative Council Staff, March 24, 1997. 281

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APPENDIXG TABLES OF STATISTICAL RESULTS 282

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Table 0.1 Summary of Regressions for Aggregated Municipalities (with Economic Variables) -Trend Gallagher TABOR Variable (1975-84) T (1985-92) T T R2 Total Revenue 0 08133 10 750 -0 04591 -3 268 -0 02219 -0 946 0 5238 Total Tax Revenue 0 08652 14 100 -0 03655 -3.436 -0 05248 -2 945 0 6822 Sales Tax Revenue 0 14034 26 210 ... -0.05641 -5.679 *** -0.06657 -3.739 0 8163 Property Tax Revenue 0 00514 0 423 0 05879 2 572 ... -0 15589 -3 873 0 5155 Charges for Services 0.03458 5 913 ... -0.02096 -2.010 ** 0 03276 2 035 ** 0 7093 Fines and Forfeits -0 00832 -2.362 ** 0 01613 2 569 ... 0 04086 3 950 0.6170 Licenses and Perm1ts -0.00334 -0 583 -0 01032 -0.950 0.13546 7 428 *** 0.7184 Miscellaneous Revenue 0.12540 13.020 -0.10869 -6 058 0.00262 0.082 0.5633 Specific OWnership Tax -0 03399 -8.560 0 04473 6.056 ... -0 00030 -0 022 0 5802 Revenue from State 0 04934 3 863 ... 0 00315 0 132 -0 04783 -1.133 0 3380 N Transfer in from Enterpnses 0 01350 2 684 -0 00632 00 -0 730 -0 03112 -2. 222 0 5905 Total Operating Expenditures 0 07417 10.170 *** -0.03811 -2 803 -0.03475 -1.454 0.5464 General Government 0 07482 12 610 ... -0 04598 -4 183 ... -0 02970 -1.499 0.5604 Judicial -0 00165 -0 265 0 04886 4 133 -0 08414 -4. 006 0 4611 Law Enforcement and Jail 0 03413 3 238 0 01782 0 912 -0.11024 -3. 100 0 7474 Fire Protection -0 00566 -1.701 0 02485 4.209 *** -0 03183 -3.121 0 7421 Roads and Highways 0.05346 5 266 0.02126 1 .101 -0.09976 -2. 922 *** 0.4637 Solid Waste Services 0 00015 0 052 0 01827 3 617 *** 0.01118 1 380 0 .7371 Other Public Works 0 01391 2 035 ** -0 04842 -3 798 0 04410 1 934 0 3022 Health 0 01047 2.935 *** -0 00070 -0.114 -0 03511 -3. 379 0 5739 Culture and Recreation 0 04504 6.628 0 02204 1 .771 -0.02336 -1.022 0 7374 Miscellaneous Expenditures 0 01139 1 278 -0.03316 -1. 990 ** 0 00239 0 076 0 3250 Transfers to Enterprises 0 01751 2 319 ** 0 01341 0 927 -0.05478 -2 105 ** 0 4454 Capital Outlays 0 06004 6 493 *** -0 05272 -2 366 ** 0 04911 1 233 0 4965 General Debt Service 0.04606 6.016 *** 0.00973 0.731 -0 11223 -4.860 *** 0 6501 Note: N "'5,610; municipalities= 255; time periods= 22. Significance Is Indicated by at the 10% level; by at the 5% level; and by at the 1% level.

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Table 0.2 Revenue and Expenditure Coefficients as Percentages for Aggregated Municipalities Post-Gallagher Post-TABOR Dependent Variable Trend% Trend% TABOR% Trend% Total Revenue 8 13 *** -4.59 *** 3.54 -2.22 1 32 Total Tax Revenue 8 65 *** -3 65 ... 5 00 -5 25 -0.25 Sales Tax Revenue 14 03 *** -5 64 ... 8 .39 -6.66 1 .74 Property Tax Revenue 0.51 5.88 6.39 -15.59 *** -9.20 Charges for Services 3.46 *** -2 10 1.36 3.28 4 64 Fines and Forfeits -0 83 1.61 0.78 4.09 .... 4 87 Licenses and Permits -0 33 -1. 03 -1.37 13 55 12 16 Miscellaneous Revenue 12 .54 -10 87 1.67 0 26 1 93 Specific Ownership Tax 3.40 ... 4 .47 ... 1 .07 -0. 03 1 04 Revenue from State 4.93 0 .31 5.25 -4.78 0 .47 N Transfer in from Enterprises 1.35 ... -0 63 0.72 -3 .11 -2.39 00 + Total Operating Expenditures 7.42 -3 .81 3.61 -3.48 0.13 General Government 7 48 -4.60 2.88 -2.97 0.09 Judicial -0.16 4.89 ... 4 72 -8.41 ... -3 69 Law Enforcement and Jail 3.41 1 78 5.19 -11.02 -5 83 Fire Protection -0 57 2.48 1 92 -3 18 -1. 26 Roads and Highways 5 35 ... 2 13 7 .47 -9 98 ... -2 50 Solid Waste Services 0 02 1.83 1 .84 1 12 2.96 Other Public Works 1.39 .. -4 84 -3 .45 4 .41 0.96 Health 1 05 -0 07 0.98 -3 .51 -2 54 Culture and Recreation 4 50 2 20 6.71 -2 .34 4 .37 Miscellaneous Expenditures 1.14 -3.32 -2 .18 0.24 -1.94 Transfers to Enterprises 1.75 1.34 3.09 -5.48 -2.39 Capital Outlays 8 00 -5 27 2 73 4.91 7 64 General Debt Service 4 .61 ... 0 97 5.58 -11.22 ... -5.64 Note: N = 5,61 0; municipalities = 255; lime periods = 22. Slgnlllcance I& Indicated by at the 10% level; by at the 5% level; and by ... at the 1 'Ill level.

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Table 0.3 Summary of Regressions with Economic Variables for Population Group (1-1 ,999) Dependent Variable Trend T Gallas her T TABOR T R2 Total Revenue 0.09433 7 769 ... -0.04229 -1.856 .. -0.04146 -1. 110 0.4657 Total Tax Revenue 0.08673 8 763 ...... -0.02585 -1.391 -0 08240 -2 717 ...... 0.6314 Property Tax Revenue 0 02254 1 .563 0.05420 1 998 .... -0 17678 -3 782 .... 0 4961 Sales Tax Revenue 0 13237 14. 930 ...... -0.02851 -1. 730 -0 09529 -3 343 0 8021 Total Operating Expenditures 0 08443 7 .557 ...... -0.03200 -1. 506 -0.05972 -1.596 0.4857 N General Government 0.08595 9 671 -0.04312 -2 580 -0 05064 -1. 685 0.5320 00 Law Enforcement and Jail 0.02848 2 115 0.02556 1 018 -0.13798 -3 .011 0 7094 Ul Roads and Highways 0.05979 4 .581 0.03340 1 .361 -0.13772 -3.142 .... 0 4439 Solid Waste Services -0.00578 -1.440 0.02845 3 879 ..... 0.01911 1.615 0.6892 Culture and Recreation 0.03605 4 394 .... 0.05197 3.422 -0.04121 .486 0 6066 Note: N = 3,696; municipalities= 168; time periods= 22. SignifiCance is indicated by at the 10% level; by at the 5% level; and by ... at the 1% level.

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Table 0.4 Summary of Regressions with Economic Variables for Population Group (2,000 .. 4,999) Deeendent Variable Trend T GallaHher T TABOR T R2 Total Revenue 0.07534 8.167 -0 07023 -4.192 -0 02728 -0. 946 0 6211 Total Tax Revenue 0 09096 9.734 -0 07891 -4 186 -0.02249 -0. 870 0 7078 Property Tax Revenue -0.02873 -2.430 0 07224 3 296 ... -0.16628 -4.231 0 5706 Sales Tax Revenue 0 24885 13.760 -0.22455 -7.199 0.02631 0 534 0 7116 Total Operating Expenditures 0 06101 7.133 -0 04818 -3.104 .... -0.01297 -0.462 0 6095 General Government 0 03680 5 .261 -002739 -2 159 -0 03019 -1.338 0 6784 N 00 Law Enforcement and Jail 0 04548 3.289 -000130 0.494 -0 06541 -1.352 0 6785 0\ Roads and Highways 0.05424 3.653 -0 02641 -0.951 -0.02569 -0 524 0 4833 Solid Waste Services 0.05075 6.361 -0.04054 -3.037 ... -0 01289 -0. 576 0.8004 Culture and Recreation 0 08346 6 119 -0 05408 -2.194 -0.02402 -0. 557 0 7151 Note: N = 770; municipalities= 35; lime periods= 22. Significance Is Indicated by at the level; by lithe 5'llllevel; 1nd by ... lithe 1 'Ill level.

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Table 0.5 Summary of Regressions with Economic Variables for Population Group (S,OQQ,9,999) Variable Trend T Gallas her T TABOR T R2 Total Revenue 0.06614 5.007 ... -0.05867 -2.519 0 01361 0.362 0.8417 Total Tax Revenue 0.07780 6 538 -0 05821 -2.832 *** -0 02082 -0.625 0 8289 Property Tax Revenue -0 02117 -1.404 0 08580 3 540 ... -0 13004 -3.111 0 9696 Sales Tax Revenue 0.10678 5 548 -0.01921 -0.541 -0 12102 -1.679 0 9553 Total Operating Expenditures 0 07722 7 300 -0.06984 -4 546 0.03402 1 035 0 5636 General Government 0.09730 9.920 ... -0 12293 -6 820 ... 0 05607 1.883 0 7566 N 00 Law Enforcement and Jail 0 02963 1 624 0 03605 1.070 -0 10635 -1. 909 0.9793 -J Roads and Highways 0 03098 2 673 ..... 0.00821 0 362 -0.00336 -0 958 0 9713 Solid Waste Services -0.01996 -2.362 -0.01256 -0.609 0.06364 2.474 0.9272 Culture and Recreation 0.07309 6 519 -0 05844 -2.707 0 08773 2 434 0 9369 Note: N = 440; moolclpalitle& = 20; time perloda = 22. Significance Ia Indicated by at the 101lb level; by at the 51lb level; and by at the 1 llb level.

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Table 0.6 Summary of Regressions with Economic Variables for Population Group (10,000 .. 49,999) Variable Trend T Ganaaher T TABOR T R2 Total Revenue 0 03543 4.689 -0 02919 -3.034 ... 0.02247 1.037 0.9852 Total Tax Revenue 0.05466 8 045 -0 03342 -3 163 0.00422 0 194 0 9892 Property Tax Revenue -0 05522 -4 348 0 09613 3 761 -0.07258 -1.761 0 9924 Sales Tax Revenue 0.11969 7.076 ... -0.11112 -2.992 0.01332 0 246 0.9985 Total Operating Expenditures 0.02440 3.214 -0.00953 -0.891 0.00400 0 202 0.9871 N General Government 0 05351 9.178 -0. 01797 -1.641 -0.01136 -0.636 0 .9651 00 Law Enforcement and Jail 0 04994 2 958 0.03147 0.937 -0 06127 -1.154 0 9883 00 Roads and Highways 0 00540 0.338 0.08226 2.401 .. -0.08360 -1.544 0 9944 Solid Waste Services -0.02982 -1.775 0.07630 2.527 -0.05214 -1.028 0.9967 Culture and Recreation 0 03650 4.509 0.00069 0.052 -0.00728 -0.309 0 9864 Note: N = 440; municipalities = 20; lime periods = 22. Slgnllicance Is Indicated by at the 1 0'111 level; by at the 5'111 level; and by ... at the 1 'Ill level.

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Table 0.7 Summary of Regression with Economic Variables for Population Group (50,000 .. 99,999) Variable Trend T Gallas her T TABOR T R2 Total Revenue 0.01279 2.693 -0.00626 -0 732 0.04645 2.932 0 9985 Total Tax Revenue 0.01499 2.893 -0.00171 -0.174 0.03359 1.969 0.9982 Property Tax Revenue -0.04305 -2.817 -0.00539 -0.187 0.07435 1 406 0.9993 Sales Tax Revenue 0.02417 1 538 -0.01717 -0 536 0.04703 0 837 0 9998 Total Operating Expenditures 0.03683 8 734 -0.02913 -3.746 0 00545 0 386 0 9985 N General Government 0.05555 7 258 -0 04206 -2 799 ... -0.01092 -0 485 0.9872 (X) Law Enforcement and Jail 0 .12006 5.644 -0.13981 -3.645 ... 0.09990 1 .417 0 .9985 \0 Roads and Highways 0.07138 2.595 -0.09326 -1. 796 0.00869 0 .101 0 9988 Solid Waste Services -0.02659 -1.625 0.03274 0.876 -0.05595 -1.038 0 9996 Culture and Recreation 0.08358 5.417 -0.03898 -1. 459 0.01075 0.214 0 9894 Note: N = t32; munlcipalltiea = 6; lime periods= 22. Significance Is Indicated by at the 101!11 level; by at the 51!11 level, and by ... at the 11!11 level

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Tohle 0.8 Summary of Regressions with Economic Variables for Population Group (100,000+) Variable Trend T Gallas her T TABOR T R2 Total Revenue 0.01579 4 154 ... -0.02529 -3.661 0.02546 2 152 0 9991 Total Tax Revenue 0.02525 7.456 ... -0.03155 -4.926 0.02165 1.997 0.9992 Property Tax Revenue -0.01619 -3.476 0 01770 1 955 -0.02558 -1. 804 0.9984 Sales Tax Revenue 0.02629 1.493 0 00042 0 010 0 01012 0.154 0.9997 Total Operating Expenditures 0 01426 3 578 -0 01984 -3 579 0 01336 1.247 09989 General Government 0 00592 0 707 0.00999 0 822 -0.02794 -1. 229 0 9988 N Law Enforcement and Jail 0.03453 7 907 -0.02090 -3 314 ... -0.00368 -0.330 0.9985 \() 0 Roads and Highways -0.01928 -0 639 -0.02404 -0.547 0.08710 1.012 0.9999 Solid Waste Services 0.00902 0.227 0.05557 0.989 -0.02696 -0.207 1.0000 Culture and Recreation 0.02817 3.655 -0.02511 -1. 923 -0.02281 -0 944 0.9991 Note: N = 132; munlclpalltiea = 6; time period&= 22. Significance I& Indicated by at the 10'llllevel; by at the 5'1111evel; and by at the 1'llllevel

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Table 0.9 Comparison of Trend Percentages for Population Groups Population Population Group Population Group Group Population Group Population Group Population Deeendent Variable {601000-991999} {100,000+} Total Revenue 9.43 7.53 6.61 ... 3.54 1 .28 1.58 .... Total Tax Revenue 8.67 9 .10 7.78 5.47 *** 1.50 2.52 .... Property Tax Revenue 225 -2.87 -2.12 -5.52 -4.30 -1.62 "** Sales Tax Revenue 13.24 *** 24.89 10.88 11.97 2.42 2.63 Total Operating Expenditure 8.44 ... 6.10 7 .72 ... 2.44 3.68 ... 1 .43 *** General Government 8 .60 3 .68 9.73 5 .35 *** 5 .56 0.69 N Law Enforcement and Jail 2.85 ** 4.55 *** 2.96 4.99 12.01 3.45*** \() Roads and Highways 5.98 5.42 *** 3.10 *** 0.54 7.14 *** -1.93 Solid Waste Services -0.58 5 .07 *** -2.00 ** -2.98 -2.66 0.90 Culture and Recreation 3.61 *** 8.35 *** 7. 31 *** 3.65 *** 8.36 2.82 Note: Significance I& Indicated by at the 10% level; at the 5'111 level; and at the 1 'Ill level.

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Table 0.10 Comparison of Gallagher Intervention Percentages for Population Groups Population Population Group Population Group Group Population Group Population Group Population Variable {1-1,999l {21000-41999l {51000-9,999l {101000-491999l {501000-991999l {1001000+l Total Revenue -4.23 .. -7.02 ..... -5.87 ... -2.92 ..... -0 .63 -2.53 .... Total Tax Revenue -2.58 -7.89 ...... -5 82 ..... -3.34 ..... -0.17 -3.15 .... Property Tax Revenue 5.42 .... 7 22 .... 8 58 *** 9 .61 .... -0.54 1.77 Sales Tax Revenue -2.85 -22 .46 ..... -1.92 -11.11 ..... -1. 72 0.04 Total Operating Expenditure -3 .20 -4.82 -8 98 -0 95 -2 .91 -1.98 General Government -4 .31 ..... -2. 74 -12 29 -1.80 -4.21 .... 1.00 N Law Enforcement and Jail 2 56 -0 13 3.61 3.15 -13 98 ..... -2.09 .... \() N Roads and Highways 3 34 -2. 64 0.82 8.23 -9 33 .. -2.40 Solid Waste Services 2.84 ..... -4. 05 ..... -1.26 7.63 ... 3.27 5.56 Culture and Recreation 5.20 ..... -5.41 ... -5.84 ..... 0.07 -3 90 -2.51 .. Note: SignifiCance Ia Indicated by at the 10% level; at the 5% level; and at the 1% level

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Table 0.11 Comparison of TABOR Intervention Percentages for Population Groups Population Population Group Population Group Group Population Group Population Group Population Deeendent Variable ,2,000-4.9991 '51000-9,9991 ,50,000-991999} poo.ooo+l Total Revenue -4 15 -2.73 1.36 2.25 4.64 *** 2 55 ** Total Tax Revenue -8 24 *** -2.25 -2. 08 0 42 3 36 ** 2 .17 .. Property Tax Revenue -17 68 *** -16 63 *** -13 00 -7 26 7 43 -2 56 Sales Tax Revenue -9.53 2.63 -12 10 1.33 4.70 1.01 Total Operating Expenditure -5 97 -1.30 3 40 0 40 0 54 1.34 General Government -5 06 -3 02 5 .61 -1. 14 -1.09 -2 79 N Law Enforcement and Jail -13 .80 ... .a.54 -10.64 -6.13 9 99 -0.37 \() \.J.J Roads and Highways -13 77 -2. 57 -0. 34 -8.36 0 87 8.71 Solid Waste Services 1 .91 -1.29 6.36 -5.21 -5.60 -2.70 Culture and Recreation -4 12 -2 40 8.77 -0.73 1.07 -2 28 Note: Significance Ia Indicated by at the 1Q41b level; at the 5% level; and at the 1% level.

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N : Table 0.12 Comparison ofTrcnJ anJ Intervention Percentages for Population Group Post-Gallagher Post-TABOR Deeendent Variable Trend% Gallaaher% Trend% TABOR% Trend% Total Revenue 9.43 ... -4 23 5.20 -4.15 1.06 Total Tax Revenue 8 67 -2 58 6 09 -8.24 *** -2.15 Property Tax Revenue 2 25 5.42 7.67 -17.68 ... -10 00 Sales Tax Revenue 13 24 ... -2 .85 10 39 -9.53 ... 0 86 Total Operating Expenditures 8.44 ... -3 20 5 .24 -5.97 -0.73 General Government 8.60 -4.31 4.28 -5.06 -0.78 Law Enforcement and Jail 2 85 2.56 5.40 -13.80 *** -6 39 Roads and Highways 5 98 3 .34 9.32 -13.77 *** -4. 45 Solid Waste Services -0 56 2 84 2.27 1.91 4 18 Culture and Recreation 3 .61 *** 5.20 8 80 -4.12 4.68 Note: N = 3,696; MunlclpaiHies = 168; Time periods= 22. Significance of the underlying coefficients Is Indicated by at the 10%1evel; .. at the 5% level; and at the 1% level.

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Table 0.13 Comparison ofTrcnJ and Intervention Percentages for Population Group (2,000 .. 4,999) Post-Gallagher Post-TABOR Deeendent Variable Trend% Gallaaher% Trend% TABOR% Trend% Total Revenue 7.53 -7.02 0.51 -2.73 -2 .22 Total Tax Revenue 9.10 ... -7 89 *** 1.21 -2.25 -1. 04 Property Tax Revenue -2.87 ** 7 22 4.35 -16.63 *** -12 28 Sales Tax Revenue 24.89 ... -22.46 ... 2 43 2.63 5.06 Total Operating Expenditures 6 10 *** -4.82 *** 128 -1.30 -0 .01 N General Government 3.68 -2.74 0.94 -3.02 -2.08 \() Law Enforcement and Jail 4 55 -0.13 4 42 -6.54 -2 12 V\ Roads and Highways 5.42 ... -2 64 2 78 -2.57 0 .21 Solid Waste Serv1ces 5.07 ... -4.05 ... 1 02 -1.29 -0.27 Culture and Recreation 8.35 ... -5.41 .. 2.94 -2.40 0.54 Note: N = 770; Municipalities= 35; Time perioda = 22. Significance of the underlying coefflclenta Ia Indicated by at the 10% level; at the 5% level; and at the 1% level.

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N \() 0\ Table 0.14 Comparison of Trend and Intervention Percentages for Population Group (5,0QQ,9,999) Post-Gallagher Post-TABOR Dependent Variable Trend% Gallasher% Trend% TABOR% Trend% Total Revenue 6.61 -5.87 0.75 1.36 2.11 Total Tax Revenue 7.78 -5.82 1.96 -2.08 -0.12 Property Tax Revenue -2.12 8.58 6.46 -13.00 -8.54 Sales Tax Revenue 10.88 *** -1.92 8.96 -12.10 -3.14 Total Operating Expenditures 7.72 -8.98 -1.26 3.40 2.14 General Government 9. 73 -12.29 -2.56 5.61 3.04 Law Enforcement and Jail 2.96 3.61 6.57 -10.64 -4.07 Roads and Highways 310 0.82 3.92 -0.34 3.58 Solid Waste Services -2.00 -1.26 -3.25 6.36 .. 3.11 Culture and Recreation 7.31 -5.84 1.47 8.77 ** 10.24 Note: N = 440; Municipalities = 20; Time period& = 22. Significance of the underlying coefficients Ia Indicated by at the 10% level; at the 5% level: and at the 1% level.

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N \() -..1 Table 0.15 Comparison of Trend and Intervention Percentages for Population Group Post-Gallagher Post-TABOR Dependent Variable Trend% Gallagher% Trend% TABOR% Trend% Total Revenue 3 54 -2.92 0 62 2.25 2.87 Total Tax Revenue 5.47 ... -3.34 2 12 0.42 2.55 Property Tax Revenue -5 52 9.61 4.09 -7.26 -3 17 Sales Tax Revenue 11.97 -11.11 0 86 1.33 2 19 Total Operating Expenditures 2.44 -0 .95 1.49 0.40 1 89 General Government 5 35 ... -1. 80 3.55 -1. 14 2.42 Law Enforcement and Jail 4 99 3 15 8 14 -6.13 2 .01 Roads and Highways 0.54 8 23 8.77 -8.36 0.41 Solid Waste Services -2.98 7 63 4 .65 -5.21 -0.57 Culture and Recreation 3.65 0.07 3.72 -0 .73 2.99 Note: N = 440; Municipalities = 20; Time periods = 22. Significance of the underlying coefficients Ia indicated by at the 1 O'llllevel; at the 5'11> level; and at the 1 'lb level.

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N \() 0> Table 0.16 Comparison ofTrcnd and Intervention Percentages for Population Group (50,000 .. 99,999) Post-Gallagher Post-TABOR Dependent Variable Trend% Gallagher% Trend% TABOR% Trend% Total Revenue 128 ... -0.63 0.65 4.64 ... 5.30 Total Tax Revenue 1.50 ... -0.17 1.33 3.36 .. 4.69 Property Tax Revenue -4 30 ... -0.54 -4.84 7.43 2.59 Sales Tax Revenue 2.42 -1.72 0.70 4.70 5.40 Total Operating Expenditures 3.68 -2.91 ... 0.77 0.54 1.31 General Government 5.56 -4.21 1.35 -1.09 0.26 Law Enforcement and Jail 12.01 -13.98 -1.98 9.99 8.02 Roads and Highways 7.14 *** -9.33 -2.19 0.87 -1.32 Solid Waste Services -2.66 3.27 0.61 -5.60 -4.98 Culture and Recreation 8.36 -3.90 4.46 1.07 5.53 Note: N = 132; Municipalities= 6; Time periods= 22. Significance of the underlying coefficients Ia Indicated by at the 10% level; .. at the 5% level; and at the 1 'Ill level.

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N \() \() Table 0.17 Comparison ofT rend and Intervention Percentages for Population Group (100,000+) Post-Gallagher Post-TABOR Variable Trend% Gallaaher% Trend% TABOR% Trend% Total Revenue 1 58 ... -2.53 -0.95 2.55 ** 1.60 Total Tax Revenue 2 52 ... -3 .15 *** -0.63 2.17 ** 1.54 Property Tax Revenue -1. 62 ... 177 0 15 -2.56 -2.41 Sales Tax Revenue 2 63 0 .04 2 67 1 .01 3 68 Total Operating Expenditures 1.43 ... -1. 98 -0.56 1 34 0 .78 General Government 0 59 1 00 1.59 -2 .79 -1. 20 Law Enforcement and Jail 3 45 -2. 09 *** 1 36 -0 37 1 00 Roads and Highways -1.93 2.40 -4. 33 8 .71 4 38 Solid Waste Services 0 90 5 56 6.46 -2 70 3 .76 Culture and Recreation 2 82 ... -2 .51 0.31 -2.28 -1.98 Note: N = 132; Municipalities= 6 ; Time periods= 22. Significance of the underlying coefflcienta ia indicllted by at the 10'1Lievel; at the 5% level; and ... at the 1% level.

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Table 0.18 Comparison of Population Group Trend and Post .. Intervention Percentages !1 11999! !21000 41999! P22ulatlon !51000 91999! 168 Towns 35 Cities and towns 20 Cities and towns Post-Post-Post-Post-Post-Gallagher TABOR Gallagher TABOR Gallagher Post-TABOR Deeendent Variable Trend% Trend% Trend% Trend% Trend% Trend% Trend% Trend% Trend% Total Revenue 9 43 ... 5 20 1 06 7 53 *** 0.51 ... -2.22 6 .61 *** 0.75 2 .11 Total Tax Revenue 8 67 *** 6 09 -2 .15 *** 9 .10 *** 1 .21 *** -1.04 7.78 *** 1 .96 *** -0.12 Property Tax Revenue 2 25 7 67 -10 00 -2 87 ** 4 35 *** -12 28 *** -2. 12 6.46 -6.64 *** Sales Tax Revenue 13. 24 10 39 0 86 24 89 ... 2 43 *** 5 .06 10 88 *** 8 96 -3.14 VJ 0 Total Operating Expenditures 8.44 *** 5.24 -0. 73 6.10 *** 1.28 *** -0 .01 7.72 *** -1. 26 *** 2.14 0 General Government 8 60 4.28 *** -0.78 3 68 0 94 ** -2 .08 9.73 *** -2. 56 *** 3.04 Law Enforcement and Jail 2.85 ** 5.40 -8. 39 ... 4.55 *** 4 42 -2.12 2.96 657 -4.07 Roads and Highways 5 98 *** 9.32 -4. 45 ... 5 42 *** 2.78 0 .21 3.10 *** 3 92 3 58 Solid Waste Services -0 58 2.27 ... 4 .18 5 .07 ... 1 02 ... -0.27 -2. 00 -3 25 3 .11 Culture and Recreation 3 .61 8 80 468 8 35 2 94 .. 0 .54 7 .31 1 47 10.24 ** Note: Significance of the underlying coefficients Ia Indicated by at the 10CII.Ievel; at the 5% level; and at the 10CII.Ievel. (Con't.)

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Tablt! 0.18 (con't.) Comparison of Population Group Trend and Post, Intervention Percentages P21!ulatlon Groue 49,999) 991999) P21!ulatlon Groue 20CHies 6 CHiea 6CHlea Post-Post-Post-Post-Post-Post-Gallagher TABOR Gallagher TABOR Gallagher TABOR Variable Trend% Trend% Trend% Trend% Trend% Trend% Trend% Trend% Trend% Total Revenue 3 54 ... 0 62 2 .87 1.28 0 65 5.30 *** 1.58 *** -0.95 ... 1 60 ** Total Tax Revenue 5 47 ... 2 12 2 55 1 50 1 33 4 69 2 52 -0 63 1 54 ** Property Tax Revenue -5 52 4 09 *** 3 17 -4 30 *** -4 84 2 .59 -1. 62 *** 0 15 -2.41 Sales Tax Revenue 11. 97 0 86 *** 2 19 2.42 0 70 5.40 2 63 2 67 3 68 w 0 Total Operating Expenditures 2 44 1.49 1.89 3 68 0 77 *** 1.31 1 43 *** -0 56 0 .78 General Government 5 35 *** 3.55 2.42 5.56 1.35 0 26 0.59 1 59 -1.20 Law Enforcement and Jail 4 99 ... 8.14 2.01 12.01 *** -1.98 *** 8 02 3.45 *** 1.36 *** 1.00 Roads and Highways 0 54 8.77 .. 0 41 7.14 -2 19 -1.32 -1.93 -4. 33 4 38 Solid Waste Services -2 98 4 65 ** -0 .57 -2 66 0 .61 -4.98 0 90 6 46 3.76 Culture and Recreation 3 65 3 72 2 .99 8 36 *** 4 46 5 53 2 82 *** 0 .31 -1. 98 Note: SignifiCance of the underlying coefficient& Ia Indicated by at the 10% level; at the 5% level; and at the 10% level.

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l..J 0 N Table 0.19 Summary of Regressions Comparing Municipalities with Successful Elections vs. Municipalities without Successful Elections Has lhe municipality held a suc:ceaaful TABOR election? Trend Coefficient T Rallo Significance Total Revenue Yes No 0 0954 0 .0631 Total TIX Revenue Yes No 0 0987 0 0550 14.970 6 018 21.260 6.631 Sale& Tax Revenue Dependent Varlablet General Law Property Tax Total Operating Government Enforcement Revenue EICP80dlturea E1CP8ndlturea and Jail Culture and Recreation o .1611 o 1337 o.oo21 ..o. ooos o 0854 o 0553 o oeos o 0664 o 0573 o o1oe o .osn o 0365 22 580 18.130 0.193 -0.054 15 160 4 .982 14 680 7.731 4 .841 1 043 7 933 3 754 Gallagher Coefficient -0.0626 -0. 0264 -0.0526 -0.0097 -0.0604 -0.0545 0 0722 0.0508 -0. 0562 -0.0092 -0. 0548 -0.0304 -0. 0043 0.0469 0 0230 0.0161 T Rallo -5.2960 -1.3800 -6. 0400 -0.6450 -4.6490 -4.2840 2 7550 3.0510 -5.4140 -0.4489 -5.4790 -1.9350 -0.1959 2 6250 1.7080 0.9226 Significance ... ... .. ... ... 000 .. TABOR Coetriclent -0. 0053 -00469 ..0. 0326 -0. 0782 -0. 0612-0.0923 ..0. 1718 -0.1284 -00128 -0. 0628 -0. 0152 ..0.0495 -0. 0946 ..0. 1303 ..0.0306 -0. 0120 T Ratio -0.258 -1.412 -2.251 2 938 -2.878 -3. 806 648 -4 .239 -0.722 -1.738 -0. 875 -1.745 -2. 393 -4. 067 -1.297 ..0.398 Significance .. ... ... ... ... .. . .. R-Square 0 .51 0 .44 0 63 0 65 0 .75 0 83 0 52 0.50 0 .51 0 .50 0 58 0 .45 0 65 0.79 0 .74 0 69 Trend Percentage 954 6 .31 9 .87 5 50 16.11 13.37 0 .27 ..0. 05 8 54 5.53 8 05 6 64 5 .73 1 08 5 n 3.65 Gallagher Percentage -6.26 -2 64 -5.26 -0.97 -6. 04 -5.45 7 22 5.08 -5. 62 -0.92 -5. 48 -3.04 -0.43 4.69 2.30 1.61 Post-Gallagher Trend 3 .29 3 67 4.62 4.54 10. 06 7.91 7.48 5.03 2 92 4.61 2 .57 3.60 5 30 5.78 8.07 5.25 TABOR Percentage -0.53 -4. 69 -3.26 -7.82 -6. 12 -9.23 18 -12.84 -1. 28 -6.28 -1. 52 -4.95 -9.46 13 03 -3.06 -1.20 Post-TABOR Trend 2 .76 -1. 02 1 35 -3.29 3.94 .32 -9. 69 .81 1 64 .67 1 05 .34 -4.17 .25 5.01 4.05 Note: SignifiCance Is Indicated by at the 10% level;" at the 5% level; and ... at the 1% level.

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Table 0.20 Summary of Revenue and Expenditure Regressions without Economic Variables Deeendent Variable Trend T Garraaher T TABOR T R2 Total Revenue 0.08206 12 230 -0.04017 -3.236 -0.03113 -1. 350 0 5223 Total Tax Revenue 0.08202 17 020 -0.03084 -3 459 -0.05552 -3 353 ... 0 6810 Sales Tax Revenue 0.14035 27.510 -0.06319 -6 695 -0.04662 -2.660 0 8156 Property Tax Revenue 0.00617 0 .535 0.05924 2.777 -0.15815 -3.992 0.5153 Charges for Services 0 03752 8 107 -0.00759 -0.886 0.01976 1 243 0.7062 Fines and Forfeits -0.01098 -4 393 0.02941 6.362 0.03648 4 250 ... 0.6147 Licenses and Permits 0 00182 0 362 -0 00926 -0.993 0.15323 8.853 ... 0.7133 Miscellaneous Revenue 0 11725 12 760 ... -0 09591 -5.644 -0 00551 -0 175 0.5614 Specific Ownership Tax -0 04163 -9.579 0 06102 7 591 -0.00255 -0 .171 0.5761 Revenue from State 0 04787 3. 978 0 00557 0 250 -0.05512 -1. 333 0 3368 Transfer in from Enterprises 0.01910 4.671 ... -0 01672 -2 210 -0.02455 -1. 748 0.5897 0 Total Operating Expenditures 0.07389 11. 030 -0.03164 -2.553 -0 03774 -1. 640 0.5445 General Government 0.07527 13.260 -0 04168 -3 970 -0.03177 -1.629 0.5593 Judicial 0 00889 1.520 0.03982 3 681 -0.07211 -3.590 0 .4491 Law Enforcement and Jail 0 04471 4.479 0.00483 0 262 -0.09367 -2.732 0.7454 Fire Protection -0 00449 -1.618 0 02483 4 838 ... -0.02914 -3 058 0.7413 Roads and Highways 0 05508 5.809 0 02061 1 175 -0.09531 -2 926 ... 0.4629 Solid Waste Services -0 00165 -0.796 0.02218 5 .781 .... 0 00774 1 087 0 7365 Other Public Works 0 01010 1 554 -0.03927 -3.268 0 03453 1 548 0.3006 Health 0 01299 4.678 -0 00959 -1. 866 -0 02333 -2.447 0 .5727 Culture and Recreation 0.04757 7.891 0.02329 2.088 -0.02120 -1.023 0.7366 Miscellaneous Expenditures 0.00685 0 786 -0.02411 -1.496 -0.00390 -0.130 0.3242 Transfers to Enterprises 0.01971 2 958 .... 0.01754 1 423 -0.05117 -2 236 0 4431 Capital Outlays 0 08107 7 189 -0.04601 -2. 205 0 04724 1 220 0.4950 General Debt Service 0 05599 9 184 0 00953 0 845 -0 10586 -5 055 0.6443 Note: N = 5,610; Munlcipalnies = 255; Time periods= 22. Significance Is Indicated by at the 10'111level; at the 51111 level; and ... atthe 1'111 level.

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Table 0.21 Revenue and Expenditure Coefficients as Percentages without Economic Variables Post-Post-Gallagher TABOR Dependent Variable Trend% Gallagher% Trend% TABOR% Trend% Total Revenue 8 .21 *** -4 02 *** 4 19 -3.11 1.08 Total Tax Revenue 8 20 *** -3.08 *** 5 .12 -5 .55 *** -0.43 Sales Tax Revenue 14.04 -6.32 *** 7 72 -4.66 3.05 Property Tax Revenue 0 62 5.92 *** 6 54 -15.82 ... -9.27 Charges for Services 3.75 -0.76 2.99 1.98 4 97 Fines and Forfeits -1. 10 2.94 1 84 3.65 *** 5.49 Licenses and Permits 0 18 -0.93 -0 74 15 32 *** 14.58 Miscellaneous Revenue 11. 73 ... -9 59 2.13 -0 55 1.58 Specific Ownership Tax -4 16 6 10 1 94 -0.26 1 66 Revenue from State 4 79 0.56 5 34 -5.51 -0 17 Vol Transfer in from Enterprises 1 .91 -1.67 0 24 -2.46 -2.22 0 Total Operating Expenditures 7 39 -3.16 .. 4 23 -3 77 0.45 General Government 7 53 -4.17 *** 3 36 -3.18 0 18 Judicial 0 89 3.98 4 87 -7.21 -2 34 Law Enforcement and Jail 4 47 0.48 4 95 -9 37 -4 .41 Fire Protection -0.45 2 48 ... 2.03 -2 .91 -0.88 Roads and Highways 5 .51 2 06 7.57 -9 53 -1. 96 Solid Waste Services -0.17 2 22 2 05 0 77 2 63 Other Public Works 1 .01 -3 93 ... -2 92 3 45 0 54 Health 1.30 -0.96 0.34 -2.33 -1. 99 Culture and Recreation 4.76 2.33 ** 7.09 -2.12 4 97 Miscellaneous Expenditures 0 69 -2.41 -1.73 -0.39 -2 12 Transfers to Enterprises 1 97 *** 1.75 3 72 -5.12 .. -1.39 Capital Outlays 8 .11 -4.60 3.51 4.72 8 23 General Debt Service 5.60 0 95 6 55 -10.59 -4 03 Note: N = 5,610; Municipalities= 255; Time periods= 22. Significance of the underlying coefficients Is Indicated by at the IOI!IIIevel; at the 5% level; and ... at the 1% level.

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Table 0.22 Comparison of Revenue and Expenditure Variables Effect of Economic Indicators Gallagher TABOR Trend% Trend% %With Gallagher TABOR 'Ill 'Ill No Dependent Variable With Econ NoEcon Difference Econ 'Ill No Econ Difference With Econ Econ Difference Total Revenue 8.13 8 .21 ... -0.07 -4.59 -4.02 -0.57 -2.22 -311 0 .89 Total Tax Revenue 8 .65 ... 8.20 ... 045 -3.65 ... -3.08 ... -0.57 -5.25 ... -5.55 0 .30 Sales Tax Revenue 14.03 14.04 ... 0 .00 -5.64 ... ... 0.68 ... -4.68 ... .99 Property Tax Revenue 0 .51 0.62 -0.10 5.88 ... 5 .92 ... -0.05 -15.59 ... -15.82 ... 0.23 Charges for Services 3 .46 3.75 ... -0.29 -2.10 -0.76 -1.34 3 .28 1.98 1.30 Fines and Forfeits -0.83 -1.10 ... 0.27 1 .61 2 .94 ... -1.33 4 .09 ... 3 .65 0.44 Licenses and Permits -0.33 0 .18 -0.52 -1.03 -0.93 -0 11 13.55 ... 15.32 ... -1.78 Miscellaneous Revenue 12.54 ... 11.73 ... 0 .82 -10.87 ... -9.59 ... -1.28 0 .26 -0.55 0.81 Specific Ownership Tax -3.40 ... -4.16 ... 0.76 4.47 6.10 ... .63 -0.03 -0.26 0.23 Revenue from State 4 .93 ... 4 .79 ... 0 .15 0 .31 0 .56 -0.24 -4.78 -5.51 0 .73 \,;.) Transfer In from Enterprises 1 .35 1 .91 ... -0.56 -0.63 -1.67 .. 1 .04 -3.11 -2.46 -0.66 0 VI Total Operating Expenditures 7 .42 7 .39 ... 0 .03 -3.81 -3.16 .. -0.65 -3.48 -3. n 0 .29 General Government 7.48 ... 7.53 ... -0.05 -4.60 ... -4.17 ... -0.43 -2.97 -3.18 021 Judicial -0.16 0.89 .05 4.89 ... 3 .98 ... 0.90 -8.41 ... -7.21 ... .20 Law Enforcement and Jail 3 .41 ... 4.47 ... -1.06 178 048 t.30 -11.02 ... -9.37 ... -1.66 Fire Protection -0.57 -0.45 -0.12 2 .48 ... 2.48 ... 0 .00 -3.18 ... -2.91 ... -0.27 Roads and Highways 5 .35 5.51 ... -0.16 2 .13 2.06 0 .06 -9.98 ... -9.53 ... -0.45 Solid Waste Services 0 .02 -0.17 0.18 1 .83 ... 2 .22 ... -0.39 1 .12 o.n 0.34 Other Public Works 1 .39 .. 1.01 0.38 -4.84 ... -3.93 ... -0.91 4.41 3.45 0.96 Health 1 .05 ... 1 .30 ... -0.25 -0.07 -0.96 0 .89 -3.51 ... -2.33 -1.18 Culture and Recreation 4 .50 ... 4 .76 ... -0.25 2 .20 2.33 .. -0.13 -2.34 -212 -0.22 Miscellaneous Expenditures 1.14 0.69 0.45 -3.32 .. -2.41 -0.91 0.24 -0.39 0.63 Transfers to Enterprises 1 .75 .. 1.97 ... -0.22 1.34 1.75 -0.41 -5.48 .. -5.12 .. -0.36 Capital Outlays 8 .00 ... 8 .11 ... -0.10 -5.27 -4.60 -0.67 4 .91 4 .72 0.19 General Activity Debt Service 4 .61 ... 5 .60 -0.99 0 .97 0 .95 0 .02 -11.22 ... -10.59 ... -0.64 Note: N = 5,610; Municipalities;: 255; Time periods;: 22. Significance or the underlying coefficients Is Indicated by at the 10'111 level, at the 5'111 level; and ... at the 1'111 level.

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\.J.I 0 0\ Table0.23 Comparison of Population Groups ...... Property Tax Revenues with Assessed Value as an Independent Variable Population Group Population Group Population Group Population Group Population Group Population (2,000-4.999) (5,000-9,999)_ __ 110,000-49,999) (100,00Q+} N = 3696, N = 440, N = 440, Municipalities = N = 770, Municipalities = Municipalities = N = 132, N = 132, 168 Mumcipalitles = 35 20 20 Municipalities = 6 Municipalities = 6 Tax Revenue b T-ratio P b T-ratio P b T-ratio P b T-ratlo P b T-ratio P b T-ratlo P Trend 0.01893 1 .298 .0 .04224 -3.020 .0 .01927 -1.129 .0 .05660 -4.613 .004816 -2.672 ... .0 .01383 -3.164 Gallagher 0 .05018 1 .886 007681 3 .044 0.05116 1.764 0 .09167 3.679 .0 .00011 -0.004 0 .00788 0.929 TABOR -0.14304 -3.110 ... -0.07543 -1.635 -0.03416 -0.710 .0 .04574 -1.063 0.06933 1 .354 -0.00474 -0.330 Trend 'Ill 1 .69 -4.22 -1.93 -5.66 -4.62 .36 Gallagher 'Ill 5.02 7.66 5.12 9 .19 -0.01 0 .79 TABOR 'Ill -14.30 -7.54 -3.42 -4.57 6.93 -0.47 Trend 'Ill 1 .89 -4.22 -1.93 -5.66 -4.82 -1.38 Post-Gallagher Trend 'Ill 6 .91 346 3 .19 3 .53 -4.83 -0.59 Post-TABOR Trend% 7 .39 -4.09 .0 .23 -1.05 2.11 -1.07 Note: Significance of the underlying coefficients Is Indicated by at the 10% level; at the 5'111 level; and at the 1 'Ill level.

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Table 0.24 Components of Total Municipal Revenue (Percent) by Groups Munlclpalltiee In 15 All Population Population Population Population Population Population Eastern Plakla Municipalities 1,999 2,()()().4 ,999 5,()()().9 ,999 10,000-49,999 50,000-99,999 100,000+ Countlea % ofTotal % ofTotal % ofTotal %of Total %of Total %of Total %of Total %of Total Sales Tax 43.51 33.37 46.65 50.86 51.70 51.46 50.43 36.08 Property Tax 9 .46 8.44 7 .04 6.77 6.27 7.13 7 .86 10.45 SpecifiC Ownership Tax 0 .96 0 .84 0 .69 0.71 0 .84 0 .86 0.94 1.24 Franchise Tax 2.40 2 .13 252 2 .97 3 .15 292 2 .52 3 .12 Occupation Tax 1 .74 0 .09 0 .07 0 .04 0 .49 0 68 0 .60 0 .13 Other Taxes 3.17 1509 5 .36 2.94 1 .77 1 .08 1 .48 0 .14 State Revenue 9 .57 1207 4 .80 5 .65 4 .68 4 .70 6 .78 8.46 Federal Revenue 3 .12 1 .33 1.27 1 .22 1 .30 2 .47 5 .12 2 .87 0 -.1 Other Govt Rev 2.55 1 .65 3 .69 2.59 4.29 4.24 2.70 2.97 Licenses & Permits 2 .75 4.71 4 .45 2.50 4 .22 4.53 2.15 0.73 Charges 9 .58 6.05 9 .23 8.87 9 .82 8.60 7.91 12.72 Fines and Forfeits 1.70 1 .33 127 1.43 1.27 1 .55 1 .46 1.47 Misc. 5 .15 8 .26 6 .53 7 .75 5.68 5 .19 4.52 8.43 Interest Revenue 2.71 2 .82 2.45 3 .14 3.41 2 .65 2 .31 2 .93 Transfers from Enterpnaea 1.83 1 .84 3 .99 2.77 1 .31 2 .13 3 .21 8 .29 Note: The 15 counties included In the Eastern Plains group are Baca, Bent, Cheyenne, Crowley, Kiowa, Kit Can1011, Lincoln, Logan, Morgan, Otero, Phillips, Prowera, Sedgwick, Washington, and Yuma. There 59 municipalities Included In the counties. Their 1998 estimated median population was 502.

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Table 0.25 Summary of Regressions-Economic Variables Unemployment Construction Manufacturing Variable Rate T Earnlnas T Earnlnas T Total Revenue 0 .00667 1 .072 0.01103 0.457 -0.01465 -0.641 Total Tax Revenue -0.00166 -0.322 -0.01521 -0.722 -0.01127 -0.612 Sales Tax Revenue -0.00738 -1.178 0 .02538 1 .051 0 .00837 0 .501 Property Tax Revenue -0.00103 -0.116 -0.00380 -0.190 -0.00006 -0.004 Charges for Services -0.00117 -0.134 -0.00160 -0.080 -0.01734 -0.938 Fines and Forfeits -0.01177 -2.092 .. -0.03040 -1.561 -0.00869 -0.603 Licenses and Permtts -0.01008 -1.453 0 .06814 3 .203 0 .00024 0 .013 Miscellaneous Revenue 0 .00013 0 .016 0 .03235 1 .514 -0 .01667 -0.997 Specific Ownership Tax -0.02424 -5.063 ... -0.00834 -0.493 0.01885 1 .436 Revenue from State 0.00811 0 .870 -0.00548 -0.173 -0.02821 -1.376 Transfer In from Enterprises 0 00742 1.490 -0.02066 -1.094 -0.03075 -2.151 .. Total Operating Expenditure -0 .01162 -2.068 0.03314 1 .399 -0.00493 -0.224 0 00 General Government -0.00627 -1.306 0 .00819 0 .408 -0.01428 -0.732 Judicial -0 00135 -0.633 -0.02341 -1.781 -0.02187 -2.338 ** Law Enforcement and Jail -0.00947 -1.819 -0.06888 -2.339 -0.00941 -0.468 Fire Protection -0.00666 -1.782 -0.00246 -0.114 -0.03646 -2.242 Roads and Highways -0.00554 -1.072 0 .03597 1.345 0 .00646 0.306 Solid Waste Services -0.00470 -1.420 -0.00653 -0.466 0 .03681 2.366 Other Public Works -0.00258 -0.563 0.00896 0.492 0 .03041 2.154 Health -0.00310 -0.849 0 .00729 0.368 0 .02606 1 .590 Culture and Recreation -0.00024 -0.049 -0.00973 -0.469 0 .01975 1.229 Miscellaneous Expenditures -0.00208 -0.383 0 .01872 0721 -0.00877 -0.446 Transfers to Enterprises -0.01590 -2.657 0 .03719 1.458 0 .00245 0 .118 Capital Outlays -0.02259 -3.022 0.00278 0.072 0.00212 0.075 General Debt Servic -0.01459 -3.048 -0.07054 -3.332 0 .03608 2 .083 Note: N5 ,610; municipalities== 255; time periods== 22. Significance is Indicated by at the 10% level; by at the 5% level; and by at the 1% level. (Con'.)

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Table 0.25 (Con't.) Summary of Regressions-Economic Variables Personal Variable Retail Sales T Farm Income T Income T Total Revenue 0 .0239 0.636 -0.0054 -0.531 0.4732 3.109 *** Total Tax Revenue 0 .0462 1 .359 -0.0188 -2.319 ** 0 .4293 3 .528 *** Sales Tax Revenue 0 .1133 3 .056 -0.0139 -1.352 -0.3240 -2.414 Property Tax Revenue -0.0491 -1 003 -0.0027 -0.249 0 .0695 0 .431 Charges for Services -0.0067 -0.187 -0.0305 -2.607 *** 0 .9746 7.047 Fines and Forfeits 0 .0608 2 .353 ** -0.0153 -1.676 0.4324 3.427 Licenses and Permits 0 .1210 2 .485 -0.0571 -5 .007 0 .5805 3 .806 Miscellaneous Revenue 0 .0956 2 .416 0 .0221 2 .277 0 .1872 1.525 Specific OWnership Tax -0.0261 -0.892 0.0035 0.532 0 .0546 0 .537 Revenue from State 0 .0380 1.118 0.0105 0.873 0 .1303 0.883 Transfer in from Enterprises 0 .0294 0.568 -0.0165 -1.822 -0.0400 -0.323 Vol Total Operating Expenditures 0 .0073 0 .212 0 .0072 -0.804 0 .3930 2 .745 *** 0 \() General Government 0 .0214 0 .700 -0.0097 -1.221 0 .3162 2 .578 Judicial 0 .0374 0.669 -0.0540 -5.543 0 .3604 2.503 .. Law Enforcement and Jail 0.0799 2.445 -0.0505 -4.227 ... 0 .0809 0.456 Fire Protection 0 .0365 0.906 -0.0120 -1.626 0 .1627 1 .702 Roads and Highways 0 .0111 0 .229 -0.0112 -0.921 0 .1461 0.944 Solid Waste Services 0 .0139 0.478 0 .0083 1.055 0 .0122 0.123 Other Public Works -0 0047 -0.141 0.0150 1.572 0.1624 1.483 Health 0 .0223 0.682 -0.0066 -0.891 -0.2992 -2.878 ... Culture and Recreation 0 .0682 1 .347 -0.0195 -2.100 0 .2672 1 .899 Miscellaneous Expenditures 0 .0512 0 .967 0 .0107 0 .824 0 .2077 1 .193 Transfers to Enterprises 0 .0638 1.216 -0.0236 -1.841 0.4906 3.051 Capital Outlays 0.0390 0.619 -0.0148 -0.964 0.4664 2.346 General Debt Service 0 .1310 1 987 -0.0598 -4.324 0.6877 4.501 Note: N = 5,610; municipalities= 255; time periods= 22. Significance is indicated by* at the 10% level; by at the 5% level; and by ... at the 1% level.

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-----------------------...... 0 Table 0.26 Summary of Regressions with Economic Variables for Eastern Plains Group Trend Gallagher TABOR Dependent Variable (1975-84) T (1985-92) T (1993-96) T Total Revenue 0 .07132 3 .526 -0.02139 -0.636 -0.04136 -0.696 Total Tax Revenue 0.07388 4.429 *** -0.02174 -0.802 -0.08604 -1.760 Sales Tax Revenue 0.16303 12.360 -0.07722 -3.354 -0.14663 -3.923 Property Tax Revenue 0.00796 0.509 0.06027 2.364 -0.14363 -3.266 Charges for Services -0.00213 -0.238 -0.00583 -0.384 0.05631 2.673 Fines and Forfeits -0.01385 -1.276 0 .01256 0 .714 0.04036 1 .521 licenses and Permits -0.03537 -3.920 0 .03253 2.160 0 .04123 1 .806 Revenue from State 0 .04176 2 .140 0 .04026 1 .408 -0.07009 -1.479 Note: N = 5,610; municlpalhles = 255; time perlodl = 22. Significance Is Indicated by at the 10CJI.Ievel; by at the 5CJIIevel; and by ... at the 1 CJI.Ievel. R2 0.4186 0.5778 0.7594 0.4451 0.7308 0 .4625 0.5001 0 .3532

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\.1.) -Table 0.27 Eastern Plains Group Coefficients as Percentages Post-Gallagher Post-TABOR Dependent Variable Trend% Gallagher% Trend% TABOR% Trend% TotaiRevenue 7.13 *** -2.14 4 .99 -4.14 0 .86 Total Tax Revenue 7.39 -2.17 5 .21 -8.60 -3.39 Sales Tax Revenue 16.30 *** -7.72 10.56 -14.66 *** -4.06 Property Tax Revenue 0.60 6.03 ** 6.82 -14.36 *** -7.54 Charges for Services -0 .21 -0.56 -0.80 5.63 4 .84 FinesandForfeits -1.39 1 .26 -0.13 4 .04 3 .91 Licenses and Permits -3.54 3 .25 ** -0 .28 4 .12 3 .84 Revenue from State 4 .16 *" 4 .03 8 .20 -7.01 1 .19 Note: N = 5,610; muniCipalities= 255; lime periods= 22. Significance Ia Indicated by at the 10'IIIIevel; by .. 81 the 5'llllevel; and by ... at the 1'111 level.

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