SPECIAL DISTRICTS IN COLORADO:
An Analysis of Their Role in Local Government
Submitted by: Thomas P. Cody
In Partial Fulfillment of the Requirements for the Degree of Master of Planning and Community Development University of Colorado at Denver Professor Herb Smith, Thesis Advisor December, 1984
' AURARIA LIBRARY
TABLE OF CONTENTS
Evolution of the Topic......................... 3
The Project Defined ........................... 4
The Hypothesis................................. 5
MISGUIDED POWER ................................. 7
Early Settlement History....................... 7
Formation of a State........................ 13
The Great Leap Forward...................... 15
Ideology as Institutional Constraint. ... 18
THE STRUCTURE OF SPECIAL DISTRICT
GOVERNMENT IN COLORADO ........................ 24
Legislative History .......................... 26
Current Legislation .......................... 31
The Extent of Special District
THE HISTORY OF SPECIAL DISTRICT REFORM
The History of Special District Reform. . 44
ANALYSIS OF SPECIAL DISTRICT REFORM:
THE NEED FOR NEW SOLUTIONS................... 5 3
1984 Legislative Council Committee on
Special Districts.......................... 66
Footnotes................................... 7 2
TABLE OF CONTENTS (Cont'd.)
RECOMMENDATIONS AND CONCLUSIONS ................ 74
Recommendations .............................. 76
Nothing so generally strikes the imagination and engages the affections of mankind, as the right of property; or that sole and despotic dominion which one man claims and exercises over the external things of the world in total exclusion of the right of any other individual in the universe.
Blackstone, Commentaries on the Laws of England, 1782.
Durango, Colorado, City Council Chambers, August 15, 1983. The planning intern had just finished presenting a service capacity allocation study to several members of the City Council, City Planning Commission, Board of County Commissioners, County Planning Commission and city and county planning staffs. The study proposed a method of allocating development densities in the areas of La Plata County surrounding Durango. The city's wastewater treatment plant, which served the fringe area through several special districts, was in danger of having its recently expanded capacity exhausted by rapid growth in the county. The density allocations were an attempt to ensure treatment capacity for the entire service area.
The County Commissioners spoke first. They didn't like "density allocations." It reminded them of zoning, something they were proud to claim hadn't reached La Plata
County yet. The County Planning Commission agreed that capacity allocations just wouldn't work and that they would place unfair burdens on county development. The city Manager replied, "There must be some advantage to living in the city."
More meetings and public hearings were held, and eventually an intergovernmental management agreement was signed by the city and county governing bodies. There would be no density allocations and the city would move immediately to explore expanding the treatment plant again.
Meanwhile, another sanitation district was formed in the city's service area. Its proponents claimed that without a pump-back to the city's treatment plant, they would be forced to build their own lagoon system. The possibility then existed of discharging into the Animas River, which had been sufficiently polluted on six different occasions within the previous three years. Either way, the sanitation district was supporting a large shopping mall two miles south of Durango that city officials feared would drain the historic downtown commercial area. The new sanitation district had presented the city with a dilemma (jeopardizing treatment capacity or risking pollution of the river) that would result in a no-win situation (loss of commercial activity and tax dollars).
The planning intern questioned the wisdom of forming the sanitation district, considering that it exacerbated an already difficult situation. Further research revealed to
him other examples of special district proliferation that had created havoc in urban fringe areas. Strained services, increased property tax bills, and inefficient land use patterns were not unique to Durango and its environs. The intern was convinced; special districts deserved more investigation, and besides, wasn't it time to do a thesis anyway?
EVOLUTION OF THE TOPIC
The research proceeded primarily through discussions with public and private sector officials involved with special districts. Among those contacted were the State Legislative Council and its committee on special districts, the State Department of Health, the Denver Regional Council of Governments, the Colorado Municipal League, the Douglas County Planning Office, assessors' offices from the six county metropolitan Denver region, attorneys and engineers representing numerous special districts statewide, and professors at the University of Colorado at Denver and the University of Denver. The state statutes pertaining to special districts and local government powers were also read at great length.
Through all this the topic grew only more complex. The problems that special districts seemed to causeand that had stimulated the project's inception as wellcontinued to manifest themselves in many different situations. Yet the reasons for their existence and the positive contributions that special districts made also became clear. There were
obviously no easy answers and no simple way to approach the topic.
Better direction came through more reading and analysis. The Colorado Front Range Project offered an interesting, comprehensive view of the roles different levels of government assumed. Eric Kelly's "Piping Growth" ariticle and numerous conversations with planning veteran Herb Smith provided more clues to the paradox of special districts. Increasingly, it became clear that districts have become both a vehicle for growth and the symptom of a much larger abdication of power and responsibility. The thesis had evolved from a research exercise on special districts into an attempt to synthesize a broader picture of government in Colorado.
THE PROJECT DEFINED
The thesis attempts to accomplish six objectives:
1. Examine the historical and geographical context in which special districts have evolved;
2. Research the current structure of special district government, including specific powers and functions;
3. Analyze the efforts to reform special districts, and the legislative action that has resulted;
4. Discuss the roles that different levels of government assume and evaluate how special districts have performed their role;
5. Recommend the necessary modifications to existing special district laws, given their appropriate functions;
6. Consider the political, cultural, and economic context in which Colorado's special districts operate today.
The hypothesis of this paper is that the operations of special districts are a manifestation of the Colorado State Government's abdication of a commitment to land use planning. Despite a thirty year history of reform efforts and intense lobbying, the legislature has steadfastly refused to pass any substantive legislation beyond recodification of existing special district laws. Those laws effectively diffuse the power in land development controls to the point where the autonomy and flexibility vested in special districts operate out of proportion to their intended role.
The failure to change does not result from a lack of options; rather, it stems from misguided notions concerning free enterprise, private initiative, and local governance. The state government is unique in that it is the only steward of Colorado's collective resources- As such, it must define statewide land use objectives and identify their relationship to the cumulative impact of smaller, individual land use decisions. When autonomous units with limited, private goals infringe on the collective well-being, the state has a responsibility to implement a more equitable process. The operations of special districts appear to have crossed that line; this thesis seeks to understand in
Men spread now, with the whole power of the race to aid them, into every available region of the earth. Their cities are no longer tethered to running water and the proximity of cultivation. .They lie out in the former deserts, those longwasted sun baths of the race, the tower amidst eternal snows. .One may live anywhere.
H.G. Wells, The World Set FreeA Story of Mankind, 1914.
The settlement history of Colorado is the record of how man adapted to a harsh, yet fragile environment and modified the landscape in the process. It is a story of how land could be worked to man's benefit and, ironically, how success could lead to failure. More than anything, it is the history of a people that have codified an exploitive relationship with their environment through faulty precepts and misguided ideology. This chapter will trace the evolution of attitudes toward Colorado's land to determine how today's power base in both the public and private sectors developed its principles and beliefs.
EARLY SETTLEMENT HISTORY
The first inhabitants of the region, Indian hunters, moved south from the Bering Strait and across Colorado at
greater detail why it has happened, as well as what change may be desirable.
least 12,000 years ago. The plentiful game encouraged large slaughters where herds would be driven off steep hillsides or into bogs where spearing was made easy. These early people were nomadic and roamed much of the plains in search of game. Some archaeologists contend that the early extinction of certain animal species was a result of these hunting patterns, and may have contributed to the demise of these people.1
Less specialized hunting and gathering was prevalent on the plains during the Archaic period, dating from about 8500 B.C. This lasted until approximately 10 A.D. when Mexican crop farming influences arrived in Colorado. True agricultural settlements were only possible along stream beds, and even at that, production was marginal.2
On the western slope, a fascinating culture flourished in several locations around what is now the four corners area from roughly 200 B.C. until 1300 A.D. The Anasazi, or Ancient Ones as they are referred to, carved a niche (both literally and figuratively) into the desert environment where they were able to establish the longest land tenure in Colorado's history. Their canyon cliff dwellings protected them from the harsh climate and hostile nomads, allowing the people to farm the streambed at the canyon floor. They could also supplement their diet with small game caught on the mesa. Though this culture exhibited one of the most harmonious man/land relationships in the region's history,
the Anasazi eventually deserted their homes at the end of the thirteenth century, probably due to severe drought.3
The first settlers in Colorado of European descent were Spanish-Mexican colonists, arriving in the San Luis Valley during the 1830's and 1840's. These people, like others in the southwest, lived in small settlements along creeks and ditches. Though their numbers were few, the values and beliefs they brought with thema strong family, church, and community orientationremain in the cultural landscape today.4
The late 1850's began a fifty year era that would play a major role in shaping Colorado's future. With the discovery of gold in 1859 at three locations in what are now Gilpin, Clear Creek and Boulder counties, the mountains of Colorado became the temporary home for many prospectors and fortune-seekers. Mining camps and small towns sprang up not only to house the miners, but also to establish the services miners and mining operations required. These settlements proved transitory as the accessible ore became depleted or news of a new strike prompted migration. Table I indicates how short-lived most of this growth was-5
The legacy of the mining era is an interesting one. Popular lore has both romanticized the men and women who inhabited the mining towns and glorified their exploits in the mountains. But the struggling tourist industry today in places like Leadville, Cripple Creek and Ouray is testimony to the dozens of settlements no longer on the map that had
only a fleeting reason for existence. In the final analysis, the boom of mining left little for future generations.
The eastern plains and piedmont of the Rocky Mountains were the setting for slow, but steady growth through the end of the nineteenth and into the twentieth century. As the country moved west, many stayed in Colorado in the towns that were station stops along the railroad. Others looked to a life of farming and ranching, and gravitated to several agricultural colonies. Greeley, named after its controversial founder Horace, enjoyed early successes that were duly noted in the newspapers of the day. Farmers' ditches and canals had been hand dug to bring water to the fields surrounding the community, and a prospering agricultural economy developed.6
These communities were not immune, however, to the boom-bust cycle that plagued mining towns. The lack of substantial water storage facilities placed the early farmers at the mercy of seasonal climatic fluctuations, particularly during the drought years of the 1870's. The 1880's witnessed a great deal of canal and reservoir construction, which helped to develop the lifeline of mountain water onto the arid plains. These early efforts to tame the environment and mitigate the hazards to human settlement were the precursors to the first special
Several decades of generally poor soil conservation practices caught up with the farmers of the plains during the coincidence of the very severe drought of the 1930's and the Great Depression. The agricultural economy strained, many farms foreclosed, and the population shifted somewhat out of the rural areas and into the emerging centers of commerce and industry along the front range.? This also stimulated the formation of special districts. In an attempt to control the effect that a drought would have on farming.
The first eighty years of the white man's tenure in Colorado can be characterized as part pioneering, in the tradition of America's Manifest Destiny, and part entrepreneurial. For the homesteaders, financial rewards were minimal, but the satisfaction of a simple, self-determined lifestyle was great. For the entrepreneurs and speculators great wealth was possible, though few achieved it. For all, the land was not very hospitable and demanded a good deal of engineering ingenuity, hard work and local cooperation.
Like the Anasazi, the settlers had to literally carve an existence out of the landscape; unlike the Anasazi, though, most had difficulty finding a stable niche that could be maintained over time. Whether it was a barren mine or a windswept field, many early residents of the State discovered that they had taken too much from the land too quickly.
FORMATION OF A STATE
Colorado was officially recognized as a territory of the United States in 1861. Enabling legislation was then passed under the Andrew Johnson administration for three territories (including Colorado) to hold constitutional conventions, the next step toward statehood. The first such convention in Colorado was held in Golden on July 4, 1864, but the final product was soundly defeated at the polls later in the year. A renewal effort in 1865 was put down by Johnson because of his wariness of the growing "radical" Republican nature of the territory.8
The fifteen years between 1861 and 1876 were difficult ones in Colorado, as the debate over statehood raged. The officers appointed in Washington to govern the territory were selected through a blatant patronage process, and local officials chafed under their rule. Nonetheless, there were others who felt statehood would only usher in more of the "carpetbaggers," so they wanted nothing more to do with the federal government.9
In the end, politics prevailed as the Republicans in Washington envisioned three electoral votes coming from Colorado in the upcoming presidential election of 1876. The end of Ulysses Grant's second term, rife with stories of scandal and corruption, would give the Democrats good grist for the election mill. Thus, on March 3, 1875 new enabling legislation was passed allowing Colorado the right to a constitutional convention and a subsequent referendum on the
charter. The final draft put to the voters was easily passed, and Grant proclaimed statehood for Colorado on August 1, 1876.10
The Constitution, as ratified into law, was an
interesting document since it combined provisions mandated
by the federal government and standard features copied from
other state constitutions, as well as several controversial
provisions on social questions and issues peculiar to
Colorado. One of the most important "standard" aspects of
the document was the Bill of Rights. It captured much of
the Lockian/Jeffersonian language of the U.S. Constitution,
as the first three sections indicate:
Section 1. Vestment of Political Power. All political power is vested in and derived from the people; all government, of right, originates from the people, is founded upon their will only, and is instituted solely for the good of the whole.
Section 2. People May Alter or Abolish Form of GovernmentProviso. The people of this state have the sole and exclusive right of governing themselves, as a free, sovereign and independent state; and to alter and abolish their constitution and form of government whenever they may deem it necessary to their safety and happiness, provided, such change be not repugnant to the Constitution of the United States.
Section 3. Inalienable Rights. All persons have certain natural, essential and inalienable rights, among which may be reckoned the right of enjoying and defending their lives and liberties; of acquiring, possessing and protecting property; and of seeking and obtaining their safety and happiness. H
The convention had spent little time debating the Bill of Rights (it fought much more over whether a deity should be acknowledged). The logic and values incorporated into the Bill of Rights were simply accepted as inherent, and
indeed inalienable. It was obvious to any westerner that the right to own and use property to make a living was essential. The abundance of available land reinforced the notion that government should protect the rights of people seeking property to utilize in the pursuit of prosperity. Strict regulation of how that land could be used seemed unnecessary and clearly beyond the domain of the State, except where one use adversely affected another. These beliefs were also part of the national consciousness, as Charles Geisler explains:
. .In the United States, agrarian society grew along with nascent capitalism. The ideology and fact of widely held private property fitted the youthful nation's economy well. ... In keeping with the wish expressed in Hamilton's 1970 'Report on the Public Lands' the nation pursued a general policy of substituting abundant land for scarce capital. According to Madison, good government's chief objective was the protection of men in their 'different and unequal faculties for acquiring property.112
The Constitution was the document that could guarantee these
values and carry them into perpetuity.
THE GREAT LEAP FORWARD
As indicated before, the early twentieth century Colorado economy was dominated by mining, farming and ranching. The Depression dampened much of the speculation that had spurred the prosperous boom periods of earlier decades. Some redistribution of rural land ownership also occurred as people left the plains for the steadier growth and more diversified economy of Denver. Also significant was the improvement of transportation linkages with the rest
of the nation. This not only enhanced commerce, but also increased Colorado's stature as a major tourist
The years during and after World War II brought great change to the State. Of major importance was the siting of many federal facilities and institutions in Colorado. The war years witnessed the construction of military training centers such as Camp Hale, Camp Carson, Lowry Air Field, Peterson Air Field and La Junta Army Air Field, several hospitals and the Rocky Mountain Arsenal. In the post-war years, new facilities included the North American Air Defense Command (NORAD), U.S. Air Force Academy, Air Force Finance Center, National Center for Atmospheric Research (NCAR), a branch of the National Bureau of Standards, and the Denver Federal Center, home for large offices of the Departments of Agriculture and Interior.I4
Colorado's front range was the choice for the regional plants of such major corporations as Kodak, IBM, Western Electric, Martin Marietta, Hewlett Packard, and more recently, Johns Manville, Anaconda, Beech Aircraft and the Ball Corporation. Organizations such as the U.S. Olympic Committee, U.S. Figure Skating Association and the Professional Rodeo Cowboys Association have located their headquarters in Colorado Springs.I5
Population growth since 1950 has been dramatic, as Table II indicates. Though the rate of increase during
the 1880-1910 period was greater, the absolute population increase of the last three decades is unparalleled in state history. Most of this growth has occurred along the front range corridor, coinciding with the siting of the major facilities and corporations mentioned earlier, the increase in recreational opportunities and resorts in close proximity to the front range, and the increasing nationwide perception of Colorado as a desirable place to live.
The economy of Colorado has shifted considerably during the post-war years, creating a development pattern that is to date quite different from the eastern and midwestern states. Because of the dominance of the mining and agricultural sectors during the early part of this century and the slow growth between the World Wars, as well as the relative isolation of Colorado from other major population centers, the state never underwent the heavy industrialization associated with the east. The post World War II growth shifted Colorado from an extractive economy to a sophisticated service and high technology economy, without the intermediate stage of heavier industrialization.15
In some respects, the lack of industrialization before World War II acted as a stimulus for the recent growth.
Large tracts of vacant and agricultural land located close to urban centers provided the flexibility and opportunity to build the large facilities that would bring population growth. The emerging infrastructure networks were designed to accommodate the new growth without the condemnation and
redevelopment necessary in older industrialized areas. The magnitude of change, though, has created many unforseen problems and contributed to crisis situations.
IDEOLOGY AS INSTITUTIONAL CONSTRAINT
Colorado's rapid growth since World War II is made more significant by the strange bedfellows that have been created. Rural counties are the setting for the expansion of cities, and the farmer's tractor often turns on the fenceline of a subdivision. Every week front range city and county buildings are the scene for council and commission hearings on new development proposals, annexations and rezonings. The cast of characters does not change much; developers in gray suits point to colored plans and renderings, extoll the virtues of their project and introduce the "development team:" lawyers, architects, engineers, and planners. Then the public hearing opens and the adjacent land-owners talk about keeping small towns small, maintaining a lifestyle, the ills of urban life, and declining property values. The locals win an occasional battle, but inevitably lose the war.
There are numerous reasons why governing bodies have given approvals to the myriad projects that constitute the larger "sprawl." Most can be grouped under three headings, though:
1. "The growth will aid the tax base."
"The growth will provide new jobs."
2. "Legally, we have no grounds to stop this."
3. "Who are we to tell these people how to use their land?"
The first and second justifications will exist as long as taxes are collected in America and people need employment. The third involves the technical approaches to growth management, which can be improved if the expertise is available. But the fourth line of reasoning is perhaps the most important because it reflects the values of many public officials in Colorado, particularly at the county and state levels. It is in part a throw-back to the frontier, where one's land was the resource that provided a means to earn a living. In that context, restrictions place unfair burdens on citizens. Lack of government involvement can also be a distortion of the notions of free enterprise, entrepreneurship, and the "market" system. If private initiative has latitude in other sectors of the economy, the reasoning goes, why should the sale and/or use of land be any different?
There is a tragic flaw in this argument. Free enterprise is a dangerous variable in the land use arena.
The development of land is not a commodity, even though there are "products" to be sold or leased. An unsuccessful or poorly designed land use cannot be changed as an afterthought. It is a permanent feature of the landscape. Indeed, buildings can be torn down and replaced, but it is difficult to change patterns of land uses once the
infrastructure network of roads, utilities, sewer and water connections is established. Poor land use decisions today are destined to be revisited in the future.
Another misconception is that the market can effectively allocate scarce land resources. Conventional wisdom posits that as a resource necessary to production becomes more and more scarce, the marginal cost to obtain it increases. This encourages the use of more abundant, and thus, less expensive alternatives so that a variety of resources are used over time (an example would be the return of coal as an affordable energy source as oil prices rise).
It is erroneous, however, to assume that the market
allocates land in a similar fashion. It is generally true that vacant land in a developing area will appreciate in value. But this does not necessarily mean that the increase in price will discourage its use. On the contrary, the very factors contributing to its scarcity and value (desirable neighborhood or community, proximity to new transportation corridors, etc.) may press it into use faster than would have otherwise occurred.
In a situation where the last vacant site in town is awkward from an engineering standpoint (using the analogy of increasing marginal costs in extractive industries), the seller can adjust the price to what someone will pay for it. A miner cannot adjust the real cost of machinery and labor in completing a difficult extraction. This simple factthat the value of real estate is often created by
factors other than its real cost of recovery or developmentexplains the fallacy inherent in a comparison of land and extractive resources.
It is clear, then, that if the prudent and timely use of land is a goal of the State, it must be dealt with in recognition of its own dynamics and peculiarities.
Government cannot fall back on traditional free enterprise arguments to excuse its inaction. Other states have addressed land use from a statewide perspective and attempted to separate the law and economics of land transfer and development from the rest of the economy. In the next two chapters of this paper, the specifics of Colorado's approach to the issue will be addressed.
This chapter has sought to explain the fundamental assertion that Colorado government has operated under false notions of history and misguided ideology concerning the rights of individuals. Three specific arguments are made:
1. Land resources are finite and imperiled by reliance on a free market approach to development.
2. Land use decisions, whether made publicly or privately, are permanent additions to the built environment. As such, additional criteria must be considered beyond the rights of individuals to use the land for their own livelihood.
3. The value of land is in part a result of public investment. Therefore, its transfer and use is a public issue and a legitimate concern of government.
The refusal of State government to recognize these three points is an abdication of responsibility. Has individualism been venerated for so long that the concept of a public's well-being been lost? The constitutions of both the state and the nation guarantee certain personal rights, but they do not proscribe dogmatic support of private initiative at the expense of the group's welfare.
It is certainly time to reevaluate the philosophy that the collective well-being is achieved through individual pursuits for happiness, or the protection of men in their "different and unequal faculties for acquiring property."
The "health, safety and welfare" of the community must be concretely defined in terms of specific government roles. This kind of involvement was not necessary on the frontier when an ample supply of land could satisfy all. We are obviously off the frontier (and have been for quite some time), yet the mentality persists. It is one of the unfortunate contradictions of life in Colorado today.
An appropriate analogy is made by Garrett Hardin in an essay entitled "The Tragedy of the Commons." In discussing the unrestricted use of land in a commons, he states:
The rational herdsman concludes that the only sensible course for him to pursue is to add another animal to his herd. And another, and another but this is the conclusion reached by each and every herdsman sharing a commons- Therein is the tragedy.
Each man is locked into a system that compels him to increase his herd without limitin a world that is limited. Ruin is the destination toward which all men rush, each pursuing his own best interest in a society that believes in the freedom of the commons. Freedom in a commons brings ruin to all.^7
^Mel Griffiths and Lynnell Rubright, Colorado: A Geography (Boulder: Westview Press, 1983), p. 169.
^Ibid., p. 170.
^Ibid., p. 171.
4Ibid., p. 175.
5Ibid., p. 177.
^Ibid., p. 180.
^Carl Ubbelohde, Maxine Benson, and Duane A. Smith, A Colorado History (Boulder: Pruett Publishing, Co., 1982), p. 152.
9lbid., p. 153.
10Ibid., p. 155.
1:lCOLORADO, CONSTITUTION, Article 2, Bill of Rights, p.
l^charles C. Geisler and Frank J. Popper, Land Reform, American Style (Totowa, N.J.: Rowman and Allanheld, 1984), p. 17.
^Griffith and Rubright, p. 182.
14Ibid., p. 183. iSibid., p. 186.
16Ubbelohde, Benson and Smith, p. 342.
l7Garrett Hardin, "The Tragedy of the Commons," Man and the Environment (Dubuque, Iowa: William C. Brown Company Publishers, 1973), p. 265.
THE STRUCTURE OF SPECIAL DISTRICT GOVERNMENT IN COLORADO
Life in the nation-state will continue to require a singleness of purpose for success, but in a very critical sense this singleness of purpose becomes a straightjacket that makes generalized adaptation impossible. Nowhere is this conflict more evident than in our urban centers where there has been a decline in the livability of the total environment that is almost directly proportionate to the rise of special purpose districts.
Beryl Crowe, "The Tragedy of the Commons Revisited," 1969.
Special districts are quasi-municipal corporations organized to provide services to the citizens of the state. They do not have the powers of true governmental corporations, but are merely public agencies given those characteristics of municipalities necessary to carry out their limited objectives. Special districts have played a significant role in the development of Colorado; in many rural and urban fringe areas the only way to organize and finance public improvements and services has been through the district mechanism.1
Special districts derive their power from state law and can operate only in a manner prescribed by the General Assembly. Outside of school districts statutorily and
specific districts statutorily created by the General Assembly (such as the Moffat Tunnel and Urban Drainage and Flood Control Districts), there are two fundamental types of districts, distinguished by degree of autonomy and intended role. Local improvement districts (technically not "special" districts) are sometimes referred to as dependent districts and are simply geographic entities of a city or county, with a separate organization. They are established as a means to provide a particular service to an area with the associated costs being assessed against the real property of the area. Governing bodies of cities and counties have authority to create these districts and serve as the governing board. Counties can form local improvement districts for the purposes of grading, paving, curbing, guttering, lighting or otherwise improving a street or sidewalk; cities may form districts to perform all of the above in addition to providing water mains, artificial lighting, sewers, sewage disposal, and other public works benefitting land abutting the improvements.2
True special districts, as outlined in Title 32 of the C.R.S. 1973, are organized entities that possess a structural form, perpetual succession, the right to sue or be sued, the power to make contracts, obtain and dispose of property, act independently of other governmental units, and tax, borrow and spend. State enabling legislation structures the functions and organization of special districts, as well as their election procedures, number of
board members and length of tenure, financial authority, procedures to include or exclude property, and requirements for consolidation or dissolution. Districts are physically created upon action by a district court, board of county commissioners, municipal governing body or the state legislature.3 The specifics of district formation and control will be dealt with in later sections of this chapter.
The first special districts in Colorado were formed in 1905 when the General Assembly recognized the need for waterworks systems in cities larger than ten thousand people. 1905 also saw the first irrigation district, intended to provide reservoirs, supply ditches and obtain water for irrigation.4 Beginning with the 1913 Domestic Waterworks Act, the following list describes the evolution of legislation concerning special districts in Colorado:
Domestic Waterworks Act of 1913. This is the original act that authorizes the formation of districts to provide domestic waterworks systems. The districts are created by the county commissioners and have taxing and borrowing powers.
Metropolitan Districts Act of 1947. This act provides for the formation of water, sanitation, fire protection, safety protection, mosquito control, street improvements and television relay districts, either separately or in combination. Though water, sanitation, and fire protection
districts have been formed under this act, the combination of other functions with these three has rarely been approved.
1939-1949 Water and Sanitation Districts Act. Either water, sanitation, or water and sanitation districts can be formed under this act by decree of the district court after a petition and election. Many existing districts of these types were formed under this act.
Fire Protection District Act of 1949. Following a petition of fifty taxpaying electors, public hearing and election, these districts are formed by decree of the district court.
1953 Disposal Districts Act. This obscure act has led
to very few disposal districts.
Metropolitan Recreation District Act. This act has been used in the Denver metropolitan area to form several metropolitan recreation districts.
Metropolitan Water District Act of 1955. This act provides for two or more municipalities to join together to form a district providing water for domestic, industrial or irrigation use. It has rarely been used, probably due to the rather unique situations it applies to.
Hospital District Act of 1960. Several hospital districts have been formed through petition and decree of the district court.
Metropolitan Sewage Disposal District Act of 1960.
This act has been used to form the Denver Metropolitan
Sewage Disposal District, a very large operation (185 million gallons per day capacity) providing sewage transmission and treatment services. It operates through individual contracts with municipalities and smaller sanitation districts.
Recreation District Act of 1947. Another seldom used act providing for counties to establish recreation districts to be funded either from the general fund or from a maximum levy of one mill on the property in the district.
Regional Library District. Two or more governmental units may form a library district, which is supported by all the unincorporated land within the district that is not already operating libraries.
Soil Conservation District Act. After petition and referendum, soil conservation districts are formed by order of the State Soil Conservation Board. The maximum levy is one-half of one mill, though additional levies can be assessed for the related purposes of flood prevention and watershed improvement.
Cemetery District Act. Established by the board of county commissioners after submittal of a petition of the property owners, cemetery districts are governed by an appointed board who determine the mill levy.
Drainage District Act. These districts are formed by the board of county commissioners after petition of a majority of the agricultural land owners in the proposed
service area. An elected board of directors sets mill levies and may issue bonds with voter approval.
Water Conservancy District Act. Conservancy districts are created through order of the district court after petition of landowners or a governing body. They are intended to prevent floods, regulate and divert stream channels, and build reservoirs and dams. The Colorado River Conservancy District, Southwestern Water Conservation District, Caddoa Reservoir and Arkansas Basin Conservancy District have been formed by special legislative enactment.
Mine Drainage District Act. These districts are established by the district court upon petition of mine owners and after a public hearing. Very few mine drainage districts exist.5
Law Enforcement Authority Act of 1969. These authorities can be formed in counties of over 100,000 population, if at least twenty percent reside in unincorporated areas. The maximum mill levy is seven mills, and services are provided through contract with the sheriff's office.
Four special districts have been created by special enactment of the General Assembly:
Moffat Tunnel District. This was created in 1922 to provide transportation and a water tunnel through the Continental Divide. The District is comprised of the City and County of Denver, all of Grand, Moffat and Routt Counties, and portions of Eagle, Gilpin, Boulder, Adams and
Jefferson Counties. No specific limit was set on the mill levy to retire indebtedness.
Urban Drainage and Flood Control District. Created in 1969r this district is intended to provide the organization and financing for drainage and flood control projects. Contained within the district are the City and County of Denver and parts of Adams, Arapahoe, Boulder, Jefferson and Douglas Counties. Any levy in excess of nine-tenths of one mill requires voter approval.
Regional Transportation District. This District was created in 1969 to develop, operate and maintain a mass transportation system. The district includes the City and County of Denver, all of Boulder and Jefferson Counties, and part of Adams, Arapahoe and Douglas Counties. Operation and maintenance costs are financed through a one-half mill levy on each assessed dollar of valuation; capital improvements, equipment, right-of-way acquisition costs and debt service on the district's securities are paid for through a six-tenths of one percent sales tax. Voters have twice turned down proposals to increase the sales tax to finance a fixed-guideway transit system. The board of directors are now elected, while the manager remains appointed.
Three Lakes Water and Sanitation District. This district was created in 1971 to provide the organization and financing for construction of public facilities in the Grand Lake, Shadow Mountain Lake and Lake Granby area of Grand County. This effort was in response to fears of decreasing
water quality due to the burgeoning seasonal population.
The board of directors (four by appointment of the Governor and three by appointment of the Grand County Board of County Commissioners) can levy up to ten mills, as well as determine the service charges and tolls necessary to finance their operations.
The Special District Act, House Bill 1320 of the 1981 Session, is the most significant legislation under which districts are established and regulated today. It is a recodification of the Special District Control Act of 1965, as well as a consolidation of the powers granted under the following eight acts:
1. Domestic Waterworks Act of 1913
2. Metropolitan Districts Act of 1947
3. 1939-1949 Water and Sanitation Districts Act
4. Fire Protection District Act of 1949
5. Metropolitan Recreation District Act
6. Hospital District Act of 1960
7. Recreation District Act of 1947
8. Cemetery District Act
The major provisions of the Special District Act are as follows:
General Provisions. The legislative declaration states
Special districts will serve a public use and will promote the health, safety, prosperity, security, and
general welfare of the inhabitants of such districts and of the people of the State of Colorado.7
The next four paragraphs of the legislative declaration
summarize the fundamental intent of this act:
It is the purpose of Part 2 of this Article to prevent unnecessary proliferation and fragmentation of local government and to avoid excessive diffusion of local tax sources .
To facilitate the elimination of the overlapping of services provided by local governments and the double taxation which may occur because of annexation or otherwise when all or part of the taxable property of an area lies within the boundaries of both a municipality and a special district .
To provide for and encourage the consolidation of special districts and ... to prevent or reduce duplication, overlapping, and fragmentation of the functions and facilities of special districts and that consolidated districts will result in reduced costs and increased efficiency of operation .
To facilitate dissolution of special districts in order to encourage assumption of services by other governmental entities.
The general provisions also stipulate the establishment of a special districts file. This file is to be maintained by the Division of Local Government in the Department of Local Affairs and it is to list all district names, board members and boundaries. An annual list is to be compiled for public inspection.
Special districts may consist of noncontiguous parcels and they may be partly or entirely within a municipality. They may not in any way overlap a district providing the same service.
Control Act. The creation of a special district is roughly an eight step process:
1. A service plan consisting of a financial survey, preliminary engineering, map of proposed boundaries, estimate of population to be served, valuation for assessment, facilities description, cost estimates and proposed indebtedness must be filed with the board of county commissioners of all counties that contain land in the proposed district.H
2. A public hearing is then held within thirty days of the first meeting of the board after filing of the service
3. The board's action on the service plan can include unconditional approval, conditional approval or disapproval. Disapproval results from any one of the following conditions:
a. insufficient existing and projected need;
b. existing service without the proposed district is adequate;
c. adequate service provided by another entity will be available within a reasonable time;
d. the proposed district is incapable of the level of service required for the area;
e. area within district would be unable to discharge proposed indebtedness;
f. facilities and service standards are incompatible with adjacent municipalities and/or special districts;
g. service plan conflicts with an approved master plan of another government;
h. service conflicts with the water-quality management plan for the area.13
4. A petition (signed by not less than ten percent or one hundred of the taxpaying electors, whichever is smaller) representing the proposed special district is then filed with the resolution of approval by the board of county commissioners in district court (disapproval may be appealed in court).I4
5. A court hearing on the petition is then held, and if the findings are favorable, an election date is set.15
6. The question of organization of the district (for or against) and its directors is put to the electors of the special district.16
7. The court declares the special district organized if a majority of the votes cast are in favor of the district's organization. It is then a quasi-municipal corporation and political subdivision of the State of Colorado.17
8. The findings of the court are then filed by the special district with the appropriate clerk and recorder(s) and the Division of Local Government. A current map is also filed with the county assessor.16
Once approved, the service plan can only be modified by petition to and approval of the board of county commissioners. Actual departures from the service plan can
be enjoined prior to the date on which construction contracts are let.19
Inclusion of Territory. Property may be added to a special district through petition to the board of county commissioners. After a public hearing on the matter, the board may approve or disapprove, with or without conditions. A municipality or county may file an objection to the petition, citing adequate capacity to service the property in question.20 if the inclusion is granted, the new property will be liable for its proportionate share of the indebtedness incurred after the date of inclusion.21
Exclusion of Territory. Property may be excluded from a special district following petition to the board of county commissioners by one-hundred percent of the property owners located within the territory in question. The governing body of any municipality may also petition the court to exclude property within the municipal borders, as long as the city is willing and able to provide the same service.22 Once excluded, the property is still responsible for their proportionate share of all outstanding indebtedness existing prior to the exclusion date. This property will not be liable for any indebtedness incurred by the special district after the exclusion date.23
Consolidation. Two or more special districts may consolidate into a single district through resolution of the board of directors of a district and concurring resolutions form at least one other district's board. After the filing
of the consolidation resolution in the district court of the initiating special district, a hearing on the legality of the matter is held and an election date set. A majority vote in favor of the consolidation completes the process.24 Bonded indebtedness will continue to be paid off by the taxpayers within the original districts, though special rates or tolls may be charged for services shared within the consolidated district.25
Dissolution. A petition for dissolution should be filed in district court when a majority of a special district's board feels it is in the best interests of the district to dissolve. If a district lies wholly within a regional service authority providing the same service, or 85% within a municipality, the governing bodies of these entities may initiate a petition to dissolve the district.26 The petition for dissolution of a special district shall include:
1. General statement of territory, including a map;
2. Current financial statement;
3. Certificate indicating one of the following:
a. that no financial obligations or outstanding bonds exist; or
b. that funds have been placed in escrow to lower indebtedness; or
c. that the district will continue to operate in a capacity adequate to pay off all financial obligations;
4. Statement that the services previously provided will either cease or be assumed by another special district, municipality or regional service authority.27
Following submittal of a petition, court hearing and a favorable election, the court then officially orders dissolution with a statement that summarizes the retirement of any financial obligations and future service for the area.28
THE EXTENT OP SPECIAL DISTRICT GOVERNMENT
Table III illustrates the changes in the composition of local government across the nation for the last forty years. The greatest change occurred with special districts, which increased from 8,299 in 1942 to 28,733 in 1982.
UNITS OF LOCAL GOVERNMENT IN THE UNITED STATES 1942-1982
1942 1952 1962 1972 1982
Governments 155,076 116,694 91,186 78,218 82,688
Counties 3,050 3,049 3,043 3,044 3,041
ities 16,220 16,778 18,000 18,517 19,083
Townships 18,919 17,202 17,142 16,991 16,748
Districts 108,579 67,346 34,678 15,781 15,032
Districts 8,299 12,319 18,323 23,885 28,733
Sources: "Special District Government in Colorado," Colorado Public Expenditure Council and "United States Department of Commerce News" Public Information Office, Bureau of the Census, August 6, 1982.
Colorado has seen an even greater increase in the number of special district governments over a similar time period. The State Tax Commission estimated that in 1952 there were 249 special districts in Colorado. In 1957, there were 488, and in 1962 there were 622.29 The Colorado Municipal League and the Division of Local Government cite 860 districts in 1971, 930 in 1978, 973 in 1983, and 1008 in May, 1984.30 other estimates have ranged as high as 1,060 districts in 1981.31
Special district revenues and expenditures have also risen dramatically. Table IV indicates that during the twenty-five year period from 1957 to 1982, special district revenues statewide increased by over fifty-one times, total expenditures increased by over forty-six times and total outstanding debt increased by at least six times. Service
COLORADO SPECIAL DISTRICT REVENUES AND EXPENDITURES 1957, 1967, 1977, 1982 (in thousands)
1957 1967 1977 1982
TOTAL REVENUE $ 8,448 $ 26,490 $215,108 $434,300
TOTAL EXPENDITURE $11,083 $ 33,236 $261,526 $520,100
DEBT $75,832 $164,451 $476,954 N/A
Source: Colorado Public Expenditure Council Report "Special
District Government in Colorado."
charges constituted roughly half of all revenues, but utility income demonstrated the largest percent-of-total increase, 10% to 18%. In 1957, operations costs and capital layouts were about equal. By 1967, operations costs had risen to 57%, and capital outlays had fallen to 43%. By 1977 the difference had increased to 63% of spending going toward operations and only 37% to capital outlays.32 The distribution of special districts statewide illustrates the kinds of situations where districts are most frequently utilized. Twenty-eight percent of the districts are located in the six Denver metropolitan area counties (Denver, Adams, Arapahoe, Boulder, Jefferson and Douglas).
An additional 15% are located in counties outside the metropolitan area that have cities larger than 25,000 people (El Paso, Larimer, Mesa and Pueblo). Roughly 60% of the special districts in Colorado are located in predominantly rural counties with little urbanization. These are precisely the places that special districts are intended to serve: rural areas that do not have nearby incorporated
cities from which to obtain services.
TABLE V /?g4-
COLORADO SPECIAL DISTRICTS BY COUNTY, %&&&-
COUNTY # DISTRICTS COUNTY # DISTRICTS
Jefferson 88 Huerfano 12
Arapahoe 88 Gunnison 11
El Paso 47 Kiowa 11
Weld 47 Morgan 11
Larimer 44 Teller 11
Mesa 40 Las Animas 10
Douglas 39 Bent 8
Boulder 38 Washington 8
La Plata 28 Lincoln 8
Adams 27 Denver 8
Eagle 27 Costilla 8
Routt 24 Rio Grande 7
Pueblo 22 Archuleta 7
Grand 22 Phillips 7
Summit 21 Ouray 7
Garfield 20 Alamosa 7
Rio Blanco 20 Lake 6
Montezuma 19 Clear Creek 6
Kit Carson 17 Chaffee 6
Baca 17 Dolores 5
Pitkin 16 Elbert 5
Logan 15 Saguache 4
Yuma 15 Jackson 4
Cheyenne 15 Hinsdale 4
Conejos 15 Crowley 3
San Miguel 15 Custer 3
Otero 14 Gilpin 2
Prowers 14 Mineral 1
Montrose 14 San Juan 0
Source: Division of Local Government files.
Note: The numbers by county do not add up to 1008
of districts in more than one ; county.
Ijohn C. Banks, Colorado Law of Cities and Counties (Denver: By the Author, 1979), p. 334.
^Colorado Public Expenditure Council, "Special District Government in Colorado," Colorado Taxpayer Report Vol. XXVII, No. 3, 1980, p. 3.
4Banks, p. 19.
^Governor's Local Affairs Study Commission, Local Government in Colorado, 1966, p. 45.
^Legislative Council Staff Memorandum No. 3, "Statutes Governing Formation of Special Districts," June 5, 1984.
7c.r.s. Â§ 32-1-102.
8c.r.s. Â§ 32-1-102.
9c.r.s. Â§ 32-1-104.
10C.R.S. Â§ 32-1-107.
Hc.r.s. Â§ 32-1-202.
12c.r.s. Â§ 32-1-202.
13c.r.s. Â§ 32-1-203.
14c.r.s. Â§ 32-1-205.
15c.r.s. Â§ 32-1-305.
16c.r.s. Â§ 32-1-802.
17c.r.s. Â§ 32-1-305.
18c.r.s. Â§ 32-1-306.
19c.r.s. Â§ 32-1-207.
20c.r.s. Â§ 32-1-401.
21c.r.s. Â§ 32-1-402.
22c.r.s. Â§ 32-1-501.
23C.R.S. Â§ 32-1-503.
24C.R.S. Â§ 32-1-602.
25C.R.S. Â§ 32-1-606.
26C.R.S. Â§ 32-1-701.
27C.R.S. Â§ 32-1-702.
28C.R.S. Â§ 32-1-707.
28Governor's Local Affairs Study Commission, p. 38.
38Colorado Municipal League Memorandum, "Special District Formation and Dissolution, 1971-1983.
3lFrom a Conversation with Seth Goldstein, Colorado Department of Health, Planning and Standards Division, December 4, 1984.
32Colorado Public Expenditure Council, p. 2.
THE HISTORY OF SPECIAL DISTRICT REFORM EFFORTS
. .the careers of the reform heroes were predictable. In city after city, they failed to make an appreciable dent in municipal problems and, after a term or two, the rascals they had thrown out were back in. .But they believed in the importance of what they were doing; a half-century later, rheumy eyes would light up and smiles would curl corners of wrinkled lips as they talked about it, and they talked in terms old soldiers reserve for old battles. .'we were fighting to make democracy work, that's what we were doing!'
Robert Caro, The Power Broker, 1975
Special districts have been a subject of debate in Colorado for at least thirty years. Their proliferation and the resulting fragmentation of governmental services has led to a great deal of analysis by both the public and private sectors. Numerous legislative bills attempting to change the structure of special district government have been proposed at the committee level of the State Legislature. Many have reached the floor of the General Assembly, but few have actually passed. Thus, the fundamental powers of special districts remain largely unchanged.
This chapter will trace the evolution of special district reform efforts. Particular attention will be given to the major issues and concerns of the various organizations and levels of government affected by special
districts. Legislation affecting special districts (including bills not passed) will also be presented.
THE HISTORY OF SPECIAL DISTRICT REFORM
1955 Study. A 1955 study by a subcommittee of the legislative council was apparently the first official analysis of special districts in Colorado. The committee sought to lay the groundwork for further research rather than attempting to provide definitive answers. They concluded the study with five major findings:
1. There appeared to be a general lack of adherence to accepted budgeting and accounting practices, as well as conflicts with tax laws. A recommendation was made to give county commissioners the power to set tax levies only after review of district budgets. The response to this recommendation came in 1965 when the General Assembly enacted uniform accounting laws for local governments and special districts.
2. Consolidation of laws with similar language and provisions appeared possible.
3. There was no uniform method of forming special districts. A recommendation was made stipulating that all districts should be formed by petition, hearing and election. This was partially answered in 1965 when the
General Assembly passed the Special District Control Act allowing the review of petitions by county commissioners.
4. Election procedures, including eligibility requirements, varied greatly. The General Assembly adopted uniform special district election laws in 1973.
5. Consolidation of districts was seen as a possible answer to flexibility and efficiency problems.1
The Governor's Local Affairs Study Commission, 1964. Chapter Four of the "Interim Report on Local Government, 1964," examined special district government in Colorado.
The Commission concluded that in general the role that districts perform could more effectively be carried out by counties. More specifically, they cited six problems:
1. The structure of local government statewide is fragmented by the proliferation of special districts. The result is a loss of citizen responsiveness.
2. Special districts can create problems for other governments, particularly municipalities and counties.
3. The governmental organization and structure of special districts is frequently staffed by part-time people with little experience in handling the responsibilities of the district's functioning.
4. The organizational laws are neither clear nor uniform for different districts' procedures and powers.
5. Incorporation laws are weak in that the initial formation of districts is not regulated. Furthermore, the functioning of districts is not controlled.
6. Some districts under current laws have legislative police powers. These are considered inappropriate powers for a special district.2
Special District Control Act of 1965. This legislation gave power to the board of county commissioners for approving the service plan of a new special district. Criteria for the service plan were established and a hearing was declared mandatory before final action of the board.3
The Governor's Local affairs Study Commission, 1966. Despite the Special District Control Act of 1965, problems still remained in the eyes of the commission. It was unclear whether the proliferation of districts would be controlled and if the county commissioners could limit the fragmentation of local government. Operational restraints were also cited as lacking, leaving district directors with considerable power to determine taxes and regulations. Residents of districts still appeared to have little representation and access to decision-making. The recommendations of the commission were to recodify the myriad acts under which districts are formed into one set of laws; to establish special taxing districts which could eliminate the need for creating special districts in the first place; and to ultimately transfer the functions to county control.4
1969-1970 Studies. Another two-year legislative committee was authorized by the General Assembly to study the feasibility of recodifying special district laws. The
primary recommendation was to allow for dissolution and consolidation of districts. This was enacted in 1970 as Article 22 of Chapter 89, C.R.S. 1963 and cited as Part 7 of Article 1 of Title 32, C.R.S. 1973.5
1970-1973 Recodification Attempts. The legislative committee continued its work and commented in the final report,
Upon examination, the committee found that Chapter 89 of Colorado's statutes has evolved largely by piece-meal amendment. Furthermore, the Governor's Local Affairs Study Commission reported that the evolutionary growth of three laws resulted in a chapter lacking uniformity, logic, and integrity both as to policy and implementing directives. the committee believes that there is need for uniformity in the formation, organization, operation and the conduct of elections for special districts in order that the general public may more easily understand the laws governing them.6
The proposal resulted in Senate Bill 80 of the 1971
Session. It was redrafted and introduced again as Senate
Bill 363 and though it passed the Senate, it was defeated in
the House of Representatives. In 1973, virtually the same
bill was introduced as Senate Bill 308, but the Senate local
government committee postponed it indefinitely. Senate Bill
401, dealing with uniform special district elections, was
separated for Senate Bill 308 and passed.7
1975 Study. Yet another committee on special districts
was formed in 1975, partially in response to two bills that
were introduced but not adopted during the 1975 Session.
One would have prohibited any further special district
formation after July 1, 1975 and transferred existing
districts to the control of cities and counties. The second
bill would have clarified service areas for unincorporated areas of defining municipal and county service boundaries. The committee made a recommendation to pass a bill prohibiting the formation of certain districts as separate quasi-municipal corporations. Instead, the county or a municipality would control the provision of the service through special taxing assessments. Existing districts would not be eliminated, but counties and municipalities would have greater powers to assume control or dissolve them. The 1976 Session rejected the Bill.
1981 Recodification. House Bill 1320, passed during the 1981 Session, recodified the statutes concerning special district organization, powers, inclusion and exclusion of territory, consolidation, dissolution and elections. This is the most recent legislation that special districts are organized and regulated under.
Colorado Municipal League Efforts. The proliferation of special districts in Colorado has concerned municipal officials for over twenty years. Consequently, the Colorado Municipal League has actively lobbied the State Legislature and participated on committees studying special districts. The following seven issues summarize the League's concern with special districts:
1. Duplication of services occurs in areas where districts overlap municipalities that have the capacity to provide the service.
2. Many local governments are forced by budget constraints to prioritize public improvements. Since special districts are frequently single or dual purpose entities, there is no overall prioritization of improvements, which can bring great expense to the residents of overlapping districts.
3. Because of unique election laws and a generally "low profile" of district activities, residents are frequently unaware of or unable to participate in the functioning of a special district.
4. Because public improvements such as water distribution and sanitary sewer lines are a prerequisite to growth, their installment as part of a district can lead to growth that might not have otherwise occurred. The lack of conformity to county or municipal land use plans can lead to what some refer to as "sprawl."
5. Special district facilities may be built to different standards than municipal facilities, making future integration difficult.
6. Though statutes provide for the dissolution of districts, a variety of financial factors inhibit this process.
7. Special districts are a major contributor to high local property taxes. The size and limited functions of districts lead to inefficiencies of scale, poor overall budgeting and very little capital improvements
1984 Legislative Council Committee on Special Districts.
In response to the questions and concerns raised by the CML and other organizations and individuals, the legislature passed Joint Resolution No. 1027, authorizing a committee to study the matter (again). The committee met six times during the summer and early autumn of 1984, attempting to study the opportunities for consolidation of special districts. The committee listened to reports by the Division of Local Government, State Auditor's Office and the Property Tax Administrator. A common theme expressed by those testifying was that information on specific districts is lacking, particularly in terms of district finances and local representatives. There also appears to be seventy-six inactive districts and twenty-seven districts authorized but never formed.H
The relative merits and weaknesses of special districts have been debated at great length at all levels of government in Colorado. As the history of reform indicates, much of the debate has been left unanswered in terms of legislative action. Numerous bills have been proposed (including sixteen slated for the 1985 General Assembly) but few have passed. The bulk of the enacted legislation over the past thirty years has reflected efforts to clarify and recodify the law. There has been little substantive change to the fundamental powers of special districts, their
and the niche they occupy in the network of in Colorado.
^Colorado Legislative Council Memorandum No. 1, "A Background History of Special District Studies and Issues," May 31, 1984, p. 2.
^Governor's Local Affairs Study Commission, "Local Government in Colorado, 1966," p. 52.
^Ibid., p. 48.
^Ibid., p. 51.
^Colorado Legislative Council Memorandum No. 1, p. 4.
6Ibid., p. 5 .
Ibid., p. 6
^Colorado Municipal League, "The Role of Special Districts in Colorado," CML Newsletter, February 12, 1984, p. 7.
^Colorado Legislative Council, Recommendations for 1985 Committee on Special District, Report to the General Assembly, December, 1984, p. 3.
ANALYSIS OF SPECIAL DISTRICT REFORM: THE NEED FOR NEW SOLUTIONS
Greed and envy demand continuous and limitless economic growth of a material kind, without proper regard for conservation, and this type of growth cannot possibly fit into a finite environment. We must therefore study the essential nature of the private enterprise system and the possibilities of evolving an alternative system which might fit the new situation.
E.F. Schumacher, Small is Beautiful: Economics as j-f
People Mattered, 1973
This paper has investigated the evolution and current structure of special district government in Colorado. An important component of this has been the public's perception of how effective special districts are and what problems, if any, they have caused. The history of special district reform efforts indicates that many government officials consider special districts to be the cause of several land use and governmental "problems." Resolution of these issues has been difficult because of disagreements over the nature of the problem and the appropriate solutions. Lack of consensus and perhaps an unwillingness to compromise at the state level has also hampered the process.
Because of the different levels of government and interest groups involved with special districts, it is important to analyze potential reforms as objectively as
possible. Therefore, it is the intent of this chapter to develop a methodology of analysis that can be used to evaluate the proposals put to the 1985 General Assembly.
The criteria for evaluation will involve examining the roles that different levels of government assume in Colorado, with emphasis placed on the role special districts have in the network of government. The sixteen proposed bills can then be evaluated in terms of how adequately they address the changes necessary to bring special districts closer to their intended niche. Any modifications of the current proposals will be considered in the final chapter, where special district reform will be discussed in the context of Colorado's political ideology.
The five basic levels of local government in the United
States are county, municipality, township, school district,
and special district.1 The scope of this chapter is to
examine the interrelationships among three levels of local
government in Colorado, counties, municipalites, and special
districts. The Colorado Statutes define the powers
available to these entities and their relationships with the
State. Municipal powers are broad, even for statutory
cities which do not have home rule charters. The Colorado
Statutes describe a statutory city as,
an agent of the State in its government; but its primary purpose is the administration of its own internal affairs. It is a community invested with peculiar functions for the benefit of its own citizens. It possesses a local government of its own, with executive,
legislative, and judicial branches. It can enact and enforce ordinances, having the force of laws, for the regulation of its domestic concerns and the preservation of its peace. The character of a municipality, with its accompanying duties and burdens, is assumed voluntarily.2
About home rule cities, the Statutes add,
It is the intent of this article to grant and confirm to the people of all municipalities coming within its provisions the full right of self-government in both local and municipal matters and the enumeration herein of certain powers shall not be construed to deny such cities and towns, and to the people thereof, any right or power essential or proper to the full exercise of such right.3
The notion of self-government at the local level is a fundamental tenet of American government. De Tocqueville wrote,
. The principle of the sovereignty of the people governs the whole political system of the Anglo-Americans. Municipal independence in the United States is a natural consequence of this very principle.4
Indeed, local self-government is considered a critical component of democracy itself. The Front Range Project states,
We advocate maximizing the sovereignty of the people by providing options and flexibility in local government form, functions, and financing. .that local general purpose government is the primary means of assuring responsible and accessible involvement of people in the democratic process.
The rights and powers of cities in Colorado are even further enhanced by a half-dozen other controls on land outside municipal jurisdictions.5
Counties, on the other hand, are quasi-municipal corporations. They are subdivisions of the State, created
for the purposes of carrying out a portion of state political power. The general powers of counties can be summarized as follows:
1. To sue and be sued;
2. To purchase real estate;
3. To sell or lease real estate;
4. To enter into contracts necessary to the use of its
5. To operate mass transportation systems in counties outside the Regional Transportation District;
6. To operate in other capacities specifically outlined by statute.6
The board of county commissioners is given full power to manage the affairs of the county. However, the board is not a legislative body and cannot set public policy.7
Like counties, special districts are quasi-municipal corporations and political subdivisions of the State. In a predominantly rural state such as Colorado where counties are not in the business of providing urban services, special districts are primarily intended to fill the void of service provision on unincorporated land. Special districts provide organizational powers and financial mechanisms to establish urban services in areas unable to attain them from municipalities. As such, their real purpose is limited to the provision of services and their existence is not justified by any function outside of the service(s)
provided. In Special District Governments in the United
States, John Bollens states,
High-ranking among the reasons for special districts is the unsuitability of existing general local governments in terms of their area, financing, functions, or administration, or of the attitudes of those controlling them. There may be legal or operating inadequacies, or unwillingness by a government to perform a certain function. In many instances, no general local government is permitted, equipped or willing to undertake the service desired. Consideration of the inappropriateness of existing governments in these various respects will explain the establishment of numerous special districts.
Bollens makes an important point here about the nature of special district government. They are as much a result of the inadequacies of other governments as they are a result of their own attributes. Unlike counties, districts are not formed as a part of the state's administrative network. Unlike municipalities, districts are not multiple-service governments that make legislative decisions concerning the many different aspects of city living.
Special districts have no raison d'etre besides providing a particular service, which is only a small part of the package of services necessary for an inhabited area to function.
At the state level, Colorado government operates
primarily as a coordinator of local planning, not an
initiator of comprehensive planning. The Colorado State
Land Use Commission is authorized to,
develop and hold hearings upon state land use plans and maps and related implementation techniques.9
This is in recognition of the fact that,
land use, land use planning, and quality of development are matters in which the State has responsibility for the health, welfare and safety of the people of the State and for the protection of the environment of the State.
The General Assembly also recognizes the,
mutuality of interest and responsibility between the various levels of government in the state.H
Nevertheless, the Colorado State Government has not exercised its responsibility to promote mutuality of interest a great deal. The General Assembly has preferred to leave power and autonomy at the local level, rather than assuming a proactive role in defining state interests. This plays an important part in the activities of special districts.
It is the purpose of this section to analyze how special districts have evolved with respect to their intended role. If efficient delivery of services is to be an important part of Colorado's government, then it follows that the different levels should complement one another. In the previous section, the relationships between these units were explored. It was determined that special districts play an important role because they facilitate urban services in unincorporated areas. Questions have arisen, though, concerning the extent of their flexibility and the effects that district proliferation have had on other governmental units.
One of the important features of special district
formation is that the process for creating a district is not
very lengthy or complicated. This has allowed development
to proceed with a minimum of bureaucratic delays. The
seeming insignificance of each individual district's
formation has encouraged county commissioners to approve the
formation of so many districts. Because the review and
approval process does not involve lengthy consideration of
regional impacts, overlapping of special districts is
common. In discussing the somewhat illogical pattern of
incrementalism, Bollens states,
Compared with other governments, special districts often have highly unusual area characteristics. Special districts can nearly always occupy any part of the area of all other kinds of special districts. Furthermore, the area of a special district can in many instances cover a segment of or all the territory of other governments that are not special districts. Territorially, therefore, most kinds of special districts do not have to be mutually exclusive of one another or of other governments. The result is that many types of special districts pile upon one another and other governments in the same area. In contrast, no city may be situated on any portion of the territory of another city. Counties are also territorially exclusive of one another, as are townships, towns, states and nations.12
Whereas this would indicate a finite number of potential cities and counties statewide, the number of special districts is almost limitless. Since their governing boards deal with only a limited function, the overlapping of special districts does not technically constitute a duplication of services. Yet the overlapping of districts is almost a contradiction of terms. They are supposedly "special" (unique) areas where a particular
service is not otherwise available. Their overlapping indicates substantial infrastructure or service needs and hence, a demand for more comprehensive government. Multiple special districts do not in any way provide more complete or efficient government. They are simply the result of an incremental approach to growth.
Perhaps of even greater significance are the land use patterns created by the proliferation of special districts. The governing boards of the individual districts have only their own limited concerns to manage. Indeed, as an entity with debts to retire, it is only logical that special districts would act in their own best interests. The result is that some other body without vested interests in the improvements ends up being responsible for the collective well-being. Though the overall efficiency of the individual improvements affects the entire group, the somewhat abstract concept of a public good will often lose in a confrontation with private or vested interests. Furthermore, any efforts to impede the exercise of private rights and legitimate powers will be opposedin court, if necessary.
Eric Kelly discusses this dilemma in his article "Piping Growth: The Law, Economics and Equity of Sewer and Water Connection Policies:"
It has been demonstrated, however, that infrastructure improvements are strong determinants of the location of growth within a region. ... In many areas, the sewer and water systems are controlled by a special district, board, or authority, with its own governing board, legal responsibilities, and philosophies. Such a board mayintentionally or notthwart the best-laid plans. Thus it will be the decisions as to how
these services are allocated that ultimately control the growth and development patterns of communities. The master plan may be pretty, but the utility plan is potent.^3
Thus, it is clear that control of the physical services and infrastructure necessary for land development will determine the resulting land use patterns. If these improvements are in the hands of a myriad of special districts, each with individual goals and powers, the result will be a system that lacks efficiency and collective viability.
Herein lies a key flaw in the structure of special
district governments. The powers given to special districts
exceed the powers necessary to fulfill their limited role.
The activities that districts controlthe prerequisites and
components of growthare of much broader significance and
public interest than just the desires of a district's
residents, its governing board, or the developers within its
boarders. Kelly comments,
Thus, by selection, by background, by skill, by interest, by ability, and by legal authority, the boards of sewer authorities, water districts, and other special purpose boards that control these utilities are ill suited to be making decisions regarding their allocation, particularly when they are so limited that their placement influences the location of land development activity.
The obvious question that follows is "Who does monitor the activities of special districts and their relationship to the collective well-being?" The formation of most special districts is conducted first in the chambers of the board of county commissioners. They react to a proposed
service plan put forward by the landowners or developers interested in forming a district. The district court then reacts to the decision of the county commissioners, as well as a formal petition from the interested party and the results of a public hearing. Once formed, the Division of Local Government is charged with monitoring the activities of special districts through the voluntary efforts of districts to provide information. The district court is the final forum for decisions concerning service plan changes or violations.
Throughout the process, the burden of proof rests with
those who argue against the formation or activities of the
district. The capacity to regulate districts exists, but
the mandate for compliance does not. This is an ironic
twist since other levels of government have far greater
regulatory powers over less important activities. In his
article "The New Property," Charles Reich discusses the
growing power that government largess other than financial
assistancepermits, approvals, franchises, authorities,
private utilitieshave gained. He claims that while these
new "subsidies" have become more important than monitary
assistance alone, the control of them has not been
correspondingly expanded. He states,
. All property might be described as government largess, given on condition and subject to loss. If all property is government largess, why is it not regulated to the same degree as present-day largess? Regulation of property has been limited because it was in the interest of society that property be free. Once property is seen not as a natural right but as a construction designed to serve certain functions, then
its origin ceases to be decisive in determining how much regulation should be imposed. Thus in the case of government largess, nothing turns on the fact that it originated in government. The real issue is how it functions and how it should function.
The lack of control exercised over private interests,
particularly because of district and public authority
proliferation, creates a situation where resources are not
allocated by any means other than the almost unrestrained
free market. The result is, Kelly states,
[That] the patterns of growth are being determined primarily by engineering and cost considerations. the right to develop land is being allocated by not being allocatedit is being tossed out on a first-come, first-served basis to whoever happens along.16
Why is the allocation of resources so important? Many will contend that the free market regulates resources through the dynamics of supply, demand, and price. But this argument is flawed for two reasons. First, there is a lag time between supply depletion and price increase. Depending on the resource, this lag time can be long enough to cause significant damage before price discourages use. Second, there are instances where price will not increase until the resource is virtually exhaustedat which point no one can buy at any price.
A case in point is the wastewater treatment system in Durango, Colorado. The city-owned treatment plant serves not only Durango but also unincorporated land of La Plata County within several special districts in the fringe areas. Residential growth has been rapid, particularly in the county. In 1981, the treatment plant violated effluent
standards and the State Department of Health ordered a moratorium on residential taps. This was lifted shortly thereafter when the city took immediate steps to temporarily augment the plant's capacity, as well as embark on a more significant expansion over several years. The city also doubled plant investment fees (against strong criticism), but growth did not slow significantly in the county.17
Without control outside their borders, what can the city do to manage its resource better? The "free market" approach will not discourage use until the expanded capacity is exhausted. There is no price mechanism to deter it, since plant investment fees are a small percentage of the cost of a house. Without any allocation of the resource in the county, the city's resource is jeopardized. (An allocation program was proposed in August, 1983, and rejected by the Board of County Commissioners. An intergovernmental agreement was signed and it was decided to expand the plant again rather than control growth.)
The significance of the Durango example is that service provision, such as water and wastewater treatment, is not comparable to other resource recovery. The need for large capital projects such as treatment plants places a great burden on taxpayers. The infrequency with which plants are built or expanded makes it difficult to equitably spread the financing over time and among the users of that improvement. Invariably, new growth is paid in part by existing residents. Although plant investment or ta^ fees may be
charged, they do not always recover the real cost of the improvements (The Durango Public Works Department determined that the increased PIF's, though unpopular and perhaps unfair for City residents, were still not sufficient to pay for the plant expansion.).
The allocation of regional resources is occurring in piecemeal fashion at the fragmented level of local government. The Statutes provide for resources to be distributed at the local level wherever possible, but the allocation of resources is reserved for the State. The Statutes pertaining to the State's role in planning address this:
In developing its land use planning program, the (Colorado Land Use) Commission shall recognize that the decision-making authority as to character and use of land shall be at the lowest level of government possible. ... in this regard, the commission may establish criteria by which land use management problems will be classified as matters of state concern, matters of regional concern, (or) matters of local concern. .18
It is clear that with respect to special districts and the pertinent legislation, the State has not perceived a responsibility to initiate great change. It is also clear that based on the number of service plan approvals, county commissioners have been unwilling to regulate special district formation. Thus, the natural and fiscal resources of the State are being allocated by whomever uses or develops them first. Special districts, as mechanisms to organize and finance local improvements or services, were never intended to be planning agencies. Yet with the powers
given to them and the abdication of responsibility at higher levels of government, that is exactly what is being thrust upon them. With little stake in the State's collective future, the operations of special districts are contributing to statewide land use patterns, infrastructure networks, and levels of local taxation. This is a dangerous situation that calls for substantial reform by the State legislature.
1984 LEGISLATIVE COUNCIL COMMITTEE ON SPECIAL DISTRICTS
As mentioned briefly in Chapter Four, the 1984 General Assembly directed the legislative council to appoint an interim committee to further investigate special districts. Specifically, the committee addressed five issues related to the consolidation of special districts:
1. The feasibility of achieving economies of scale;
2. The evaluation of alternative methods to improve the visibility of special districts through the revision of election procedures, including the issue of integration of special district bond elections with general elections;
3. The examination of the effectiveness of special district formation under the 'Special District Control Act;'
4. The review of the power and authority of general purpose governments to utilize special taxing districts as an alternative to special district formation; and
5. The development of ways to improve the present dissolution and consolidation procedures of special districts to strengthen the absorption of special districts by general purpose governments.19
The committee's work resulted in sixteen bills for consideration by the 1985 General Assembly. A brief summary and analysis of each of the bills follows:
Bill 29. Requires adoption of an annual budget and provides for the withholding of tax monies if the budget is not properly filed; requires the district to annually provide to the board of county commissioners, county clerk and recorder and the Division of Local Government the names of the board chairman, local contact person, business address, and telephone number of the district; and provides for the dissolution of inactive districts.
Bill 30. Requires developers to disclose the existence of any special district to purchasers of property within the district.
Bill 31. Requires the county treasurer to itemize the tax bills to highlight special district levies.
These three bills would increase the visibility and accessibility of special district governments. They would perhaps result in less confusion for district residents concerning improvements and taxing. These bills do not alter the functional powers or structure of special districts in any way.
Bill 32. Provides for a reduction in the number of dates that special district elections can be held; that no election judge can be a member or candidate for a district board; and that published notices of capital construction projects appear in a newspaper within or near the district.
Bill 33. Adds the stipulation that forty percent or three hundred electors, whichever is less, must sign a
recall petition for the Three Lakes Water and Sanitation District Board.
These two bills are very minor alterations of the existing laws. They do not offer any substantive answers to existing problems.
Bill 34. Gives the Division of Local Government greater discretion in allowing for a one-time levy increase greater than the usual seven percent limitation for the purchase of capital assets.
This bill would streamline what is now a rather cumbersome process; its applicability appears limited.
Bill 35. Allows two or more metropolitan districts to consolidate and form a new district with only the powers of a single purpose district. Metropolitan powers could be obtained through a vote of district residents.
This bill is typical of the weaknesses contained in the existing legislation. It provides for consolidation, but contains no mandate or incentives to consolidate. The final clause granting metropolitan powers after a favorable vote effectively negates any improvements or streamlining the bill might achieve.
Bill 36. Increases the signature requirement on petitions to form a district from the lesser of ten percent or one hundred electors to the lesser of twenty percent or two hundred electors.
Bill 37. Provides that if fifty percent of the residents of a proposed district oppose the formation of
that district, the service plan will not be considered. The bill also gives the board of county commissioners greater discretion in excluding property prior to service plan approval.
Bill 36 would have virtually no effect on special district formation. Bill 37 might prevent some districts from forming, but it is questionable how many are formed with less than fifty percent approval anyway.
Bill 38. Simplifies the district court's exclusion of territory from a special district when annexed to a municipality if the municipality is providing the same service 'at the time of exclusion.
This would encourage less duplication of services and double taxation. It does not otherwise provide any incentives for annexation.
Bill 39. Makes a number of changes in the process of forming and operating special districts, including:
a. Expansion of service plan content for the benefit of the cities and counties a district operates in;
b. Shift of the burden of proof to those proposing a district rather than resting with those objecting to a proposal;
c. Strengthens the enforcement of service plans.
The intent of this bill is significant; several
important questions are addressed. But much like the introductory language to the current legislation, the powers
and authority to comply are weak. This bill needs strengthening to be effective.
Bill 40. Recommends that irrigation districts, internal improvement districts, water conservancy districts and water conservation districts be excluded from the requirements of the Special District Act of 1981.
This would clarify uncertainties concerning definitions and the applicability of special district laws to certain water-related districts.
Bills 41-43. Concern the effort to increase the flexibility and powers of county and municipal improvement districts as a means of reducing the pressures to create special districts. The major changes to existing laws proposed by these bills include allowing municipal improvement districts to extend into unincorporated territory with the approval of the board of county commissioners; to allow county improvement districts to extend into incorporated territory with municipal governing body approval; and to allow counties to levy a sales tax within improvement districts as an additional source of revenue.20
Of all the proposed bills, these are the most significant in attempting substantive answers to the questions raised. Specifically, Bill 41 could slow proliferation of special districts by increasing the flexibility of improvement district formation. The success of this bill (if passed) will rest on whether the powers of
the improvement district are perceived to be sufficient to accomplish what special districts have historically been utilized for.
The Colorado Legislative Council Report to the 1985 General Assembly concerning special districts is an extremely disappointing answer to the acknowledged problems special district governments in Colorado have fostered. Perhaps the directive initially given to the committee"to conduct a study of consolidation of special districts"is indicative of the kind of shallow answers the legislature sought. Solutions to the concerns expressed by many groups must involve a much more comprehensive restructuring of the functions and powers of special district government. Consolidation of existing districts is only a small part of a serious reform effort; dissolution, transference of functions to other general purpose governments, restriction of initial powers, different infrastructure and service financing mechanisms, better monitoring and regulation, and alternative forms of government also need to be investigated. Chapter Six will attempt to outline how these might work.
1Daniel R. Mandelker and Dawn Netsch, State and Local Government in a Federal System (New York: Bobbs-Merrill Company, Inc., 1977), p. 25.
2John C. Banks, Colorado Law of Cities and Counties (Denver: By the Author, 1979), p. 14.
3ibid., p. 26.
^Colorado Front Range Project, Program to the Year 2000, Report of the Roles of Government Workgroup, 1982, p. 128.
^Colorado Land Use Commission, "The Status of Land Use Planning and Regulation in Colorado," Memorandum of November 25, 1980, p. 2.
^Banks, p. 35.
7Ibid., p. 37.
8John C. Bollens, Special District Governments in the United States, (Berkeley: University of California Press, 1957), p. 6.
9C.R.S. Â§ 24-65-102.
l2Bollens, p. 25.
l^Eric Damian Kelly, "Piping Growth: The Law, Economics, and Equity of Sewer and Water Connection Policies," Land Use Law, July, 1984, p. 6.
l^ibid., p. 7.
l5Charles A. Reich, "The New Property," 73 Yale Law Journal 733, 1964, p. 779.
16Kelly, p. 8.
l^Thomas P. Cody, "Service Capacity Allocation Study," Report to the Durango City Council, August, 1983.
18C.R.S. Â§ 24-65-104.
^Colorado Legislative Council, Recommendations for 1985 Committee on Special District, Report to the General Assembly, Research Publication No. 291, December, 1984, p. 3.
RECOMMENDATIONS AND CONCLUSIONS
Many westerners have always protected their habitat. But others have not. And those who have not. .have looted and ravaged it with an intensity and thoroughness unmatched anywhere else in the nation in this century.
Richard Lamm and Michael McCarthy, The Angry West, 1982.
It is not entirely fair to characterize the legislative council committee's proposed bills as their complete understanding of special district issues. As the testimony at the six committee meetings indicates, the existence or nature of "problems" is not at all agreed upon. Representatives of the Special District Association,
Colorado Association of Housing and Builders, the Denver Technological Center, and several attorneys and financiers involved with developers all spoke in favor of special districts.^ They generally agreed that though not perfect, special districts are very important development tools and their basic powers should not be changed significantly.
With this kind of pressure, the committee compromised a great deal. The result was a diluted set of bills that attempted only a streamlining of existing powers; the bills offered no substantive change to the current laws.
This serves the highlight e# legislative process and the difficulty of achieving "ideal" solutions to problems.
As the special district example indicates, the definition of the public interest is very subjective. Even the seemingly obvious solutions to problems (which this issue/ does not process) have opponents as well as supporters, for which compromise is the answer. It is the responsibility of the elected officials to determine who the differing factions represent and to decide what is best for the State as a whole.
The results of this paper's research indicate that substantial willingness to change is necessary if the quality of growth that special districts encourage is to be improved. Furthermore, it is suggested that the positive aspects of special district functioningtheir specific role in the network of governmentcan be preserved amid reform. It is perhaps naive to propose a solution that is divorced from political reality and that suggests radical change. Seventy years of history cannot be undone in one attempt to do it "right."
Thus, a fundamental assertion of this paper is that commitment to change must be discerned from institutional or major structural change. As the recommendations will indicate, reform can be achieved through a utilization of several "dormant" provisions of the Statutes. Strong political will and a constituency for change are the goals
that future reform must be directed towards.
The remainder of this paper will focus on the specifics of the proposed changes to special district government in Colorado. Four categories of reform are suggested.
A. Modify existing special district laws to encourage consolidation, dissolutions, attractive service alternatives, and a more visible, accountable role.
B. Strengthen county government so that greater responsibilities can be absorbed at that level.
C. Implement regional service authorities to better coordinate the land development activities of local governments.
D. Encourage the State to take an active role in land use planning and to ensure that county and regional authorities fulfill their mandate.
A. Modify existing special district laws
1. Attach a termination clause to the approved service plan of any new special district. This would be related to the expected duration of indebtedness, if any. Provisions would have to be included for turning over any on-going services to existing local government. In this way, special districts could be used as a more temporary mechanism to provide services, until such time as another government entity can assume control.
2. Enact new legislation that amends the consolidation and dissolution provisions to promote the phasing out of special districts over time. A specific
time limit would be set on ultimate dissolution, perhaps based on the time remaining to retire the existing indebtedness. It would then not be possible to incur further indebtedness as a "special district" under the old legislation; new investment would have to be financed through alternative means (improvement district or municipality).
Legislation encouraging dissolution would necessarily involved three major provisions:
a. Guaranteed continuation of any services by the appropriate city or county; and
b. Administration of an annual property tax credit to the (former) district residents when annexing to a municipality. This would be equal to the annual district levy, and be effective until the district's indebtedness has been retired. Current law requires the residents of a dissolved district to assume the full taxation of the annexing municipality as well as retire the district's debt,
c. Reducing the existing requirement for
municipalities wishing to initiate district dissolution from 85% of the district being situated within the municipality to 50%.2
3. Provide the district courts with greater authority to regulate the activities of special districts. Current law only provides that "Any reasonable departure from the service plan as originally
approved or from the service plan as modified may be enjoined at any time prior to the date on which construction contracts are let."3 This places the burden of close monitoring on the public sector since the commencing of actual construction would prevent an injunction. Any use of facilities or provision of services should have the threat of being enjoined for service plan violations. The Division of Local Government, with greater financial support, could provide technical assistance to the district courts for their judicial efforts.
4. All special districts should be required to retain at least one full time local staff person for the purposes of answering inquiries, compiling financial records and updating the service plan as necessary.
Many districts now cite out-of-town attorneys as contacts, making legitimate public information difficult to obtain.^
5. Reform the election laws to include deadlines for reporting results to the Division of Local Government; stronger requirements for the publishing of election information; and the standardizing of polling places in public buildings.
6. Grant municipalities "interested-party status" in the approval or disapproval of special districts within a certain radius of the city limits. This would provide the legal standing to initiate action against a
board of co^ty commissioners and to testify before the board and the district court concerning formation of a special district.5
7. Establish a limit to the number of special districts that can cover the same area (perhaps an acre or more). In this way, confusing overlapping can be limited and alternative service provision methods encouraged, including incorporation.
8. Expand the powers of municipal general improvement districts to include unincorporated territory with the approval of the board of county commissioners. This might reduce pressures for special district formation in urban fringe areas where counties cannot provide certain necessary urban services.
B. Strengthen county government
1. Provide expanded improvement financing possibilities through county governments. One possibility would be to amend the current county improvement district statutes to include the financing of fire protection, transportation, mosquito control, safety protection, parks and recreation, and ambulance services. Also, with municipal government approval, allow incorporated territory to be included in county improvement districts.
2. Encourage the adoption of home rule county charters. This would give county governments the authority to adopt the administrative arrangement that
is best suited to their needs and size.6 a more complete administrative structure would allow counties to take greater responsibility for the activities that are occurring in their jurisdiction anyway (through special districts). Home rule charters may provide greater self-determination and efficiency of service provision and remove counties from their traditionally passive or reactive posture.
C. Implement regional service authorities
The existing statutes concerning regional service
authorities offer a solid answer to many of the questions
raised by this paper. The legislation reads:
It is further declared to be the policy of the State of Colorado to encourage the utilization of single service authorities to provide those functions, services, and facilities which transcend local government boundaries, thus reducing the duplication, proliferation and fragmentation of local governments, and encouraging establishment of efficient, effective, and responsive regional government.7
The regional service authority has yet to be utilized in Colorado. As section D explains, clarification of the responsibilities of different levels of government needs to be accomplished, so that the authority can be an effective institution.
D. Encourage State definition of land use planning
Special districts differ from other general purpose local governments in that they are not legislative bodies. They do not usually serve the range of functions or promote the community goals that municipalities do. Special
districts are mechanisms to organize and finance particular services that are necessary for growth. Their formation and regulation are controlled by other governmental units, usually the appropriate board of county commissioners or district court.
This is an illogical situation, though. The powers and structure of county government are inadequate to deal with the pressures of growth through the utilization of special districts. Because counties do not possess the autonomy and administrative structure of municipalities, they must rely on the state statutes for a great deal of guidance. The special district laws of the state in turn give a great deal of discretion to the counties in permitting the formation of districts. Once formed, though, the counties have little control over the activities of special districts, except in a passive sense when districts propose service plan modifications. The regulation and monitoring of special district activity ends up in the district court, where a minimum of staff and technical expertise confound their efforts. The Division of Local Government then becomes the "odd man out" in this arrangement, with no formal association to the other entities.
The chain of command is obviously muddled. There needs to be a clarification of the roles of different governmental units, as well as a clear separation of powers. If counties are to be the forum for petitions to form special districts, then they must be equipped with the staff and management
expertise necessary for thorough, effective decision-making. If the state is to play a regulatory role, then an organization that has some power and sufficient staff to do the work must be in control. As it exists now, neither the counties, the court, or the state agency have the resources to implement what the introductory language to the special district act declares,.
Will serve a public use and will promote the health, safety, prosperity, security, and general welfare of the inhabitants of such districts and of the people of the State of Colorado.
The State Legislature has historically advocated local governance and self-determination. Yet this must be accompanied by some larger effort to coordinate and evaluate these activities. Thus, the final recommendation of this thesis is for the State to define what its land use goals are so that it can then better understand what roles special districts should carry out. As difficult as it is in a legislative setting, the General Assembly must determine what the collective land use interests of Colorado are.
Only then can the appropriate individual activities of special districts be determined.
Chapter II of this thesis examined the historical context in which special districts have evolved. More specifically, the ideology and reasoning exhibited by the legislature over the years was discussed in an effort to better understand current attitudes towards special
districts. The lack of significant reform during the past three decades, including work done during the summer of 1984, indicates a fundamental reluctance to exercise control over district activities. Couched in arguments of preserving private initiative and local autonomy, the State has consistently abrogated its power to collectively manage the land resources of Colorado.
It is anathema for many people to believe that
localized decision-making might not be in the State's best
interests. But the fact remains that individual pursuits
can, as a whole, create problems greater than the sum of the
specific actions. Griffiths and Rubright comment,
Two cautious generalizations might be made about private land ownership in relation to resource use. One is that private land can change hands rather quickly, and it is ordinarily sold to make a profit. Similarly, the land use decisions of private owners are made in their own best interests. These interests may coincide with the best interests of society and wise stewardship of the land, but they can also be at cross purposes with those latter interests.
Second, the right to do what one wishes with one's property is an almost sacred tenet of U.S. political philosophy. That concept has been particularly strong in the west, in states like Colorado, where few people and wide open spaces have made that ideal very nearly possible in practice. As a result, private landowners are nearly always opposed to any regulations or planning that suggests a threat to their freedom of action.9
This state's history, as outlined in Chapter II, has demonstrated several examples of collective tragedies that resulted from many relatively small impacts. The argument of this paper is that there is nothing inherently evil about local decision-making, nor is there any particular wisdom in the State's leadership. But special districts, as vehicles
for decentralized land use decisions, contribute to the potential for adding another collective tragedy to Colorado's legacy. At the point of realization, it will at once be no one's fault and everyone's fault. Neal Peirce and Jerry Halstrom, in Is Colorado a Tragedy in the Making?," write,
There is no stark degradation or shocking environmental disaster to be seen in the State. And yet this may be Colorado's worst problem. Its people may have been lulled into thinking there will be no crisis, that a solution can be found to all growth problems.
But we see a gathering crisis of deeply disturbing proportions: the gradual decline in the quality of life, a steady loss of agricultural land, open space, wildlife habitat, landscape diversity, all accompanied by worsening traffic and deteriorating air quality. If this is the model of the 'developed' western state in America, then it will be not just one politician or another who appears a failure. A once-in-a-generation opportunity to build a resilient, conserving society in one of the most exquisite places on earth will have been forsaken.
The responsibility for this tragedy is not being placed on special districts. Cities, counties and the State will all share the blame. Similarly, special districts have been singled out in this thesis as one part of a statewide land use dilemma. How will the public interest be reconciled in the face of a mass exercise of private initiative?
Special districts were chosen for this study because of
their potential vulnerability in the face of development
pressures. There are many examples of special districts providing timely, efficient services to the people of Colorado. But there are enough examples of abuse, inefficiency and general confusion to warrant a close examination of their structure and powers, as well as the
efforts to reform the laws governing their operations.
The results of this investigation are, very simply, that governmental reform is necessary. Realistically, the change will be incremental. Existing special district laws must first be streamlined and modified to encourage consolidations and dissolutions where possible, so that the functions can be absorbed under more comprehensive governments. Workable, attractive alternatives that reduce fragmentation of local government must also be encouraged. Finally, the State must vest power with regional entities that can more effectively manage the land resources and physical infrastructure of Colorado. No amount of special district reform will completely solve the land use dilemmas that Colorado faces. Collective goals must be established so that the functional and ideological power of private interests can be reckoned with.
Banks, John C. Colorado Lav of Cities and Counties.
Denver: By the Author, 1220 Olive, 1979.
Bollens, John C. Special District Governments in the United States. Berkeley: University of California Press, 1957.
Bowen, Don L. Special District Government in Arizona: A Report with Recommendation. University of Arizona Office of Planning and Budgeting, 1982.
Burns, James MacGregor. The Deadlock of Democracy: Four-Party Politics in America. Englewood Cliffs, N.J.: Prentice Hall, Inc., 1963.
Caro, Robert A. The Power Broker: Robert Moses and the Fall of New York. New York: Vintage Books, 1975.
COLORADO. CONSTITUTION. (1876).
COLORADO. REVISED STATUTES. (1973).
Colorado Department of Local Affairs, Division of Property Taxation. 1983, Thirteenth Annual Report. Report to the Governor and the Legislature. May, 1984.
Colorado Front Range Project. Program to the Year 2000. Report of the Roles of Government Workgroup. 1982.
Colorado Land Use Commission. "The Status of Land Use Planning and Regulation in Colorado." Memorandum of November 25, 1980.
Colorado Legislative Council. Recommendations for 1976 Committee on Local Government. Report to the General Assembly, Research Publication No. 212. December, 1975.,
Colorado Legislative Council. Recommendations for 1985 Committee on Special Districts. Report to the General Assembly, Research Publication No. 291. December, 1984.
Colorado Legislative Council. Regional Service Authorities. Report to the General Assembly, Research Publication No., 176. November, 1971.
Colorado Public Expenditure Council. "Metro Council Ballot Proposal." Colorado Taxpayer Report Vol. XXVII, No. 4. October, 1980.
Colorado Public Expenditure Council. "Special District Government in Colorado." Colorado Taxpayer Report Vol. XXVII, No. 3. August, 1980.
Crowe, Beryl L. "The Tragedy of the Commons Revisited."
Man and the Environment. Debuque, Iowa: William C. Brown Company Publishers, 1973.
Geisler, Charles C., and Popper, Frank J. Land Reform, American Style. Totowa, N.J.: Rowman and Allanheld, 1984.
Governor's Blue Ribbon Panel. Private Choices, Public Strategies*; Growth, Development, and Investments for Colorado, 1981-2001. 1981.
Governor's Local Affairs Study Commission. Local Government in Colorado, 1966.
Griffiths, Mel^, and Rubright, Lynnell. Colorado: A Geography. Boulder: Westview Press, 1983.
Hagman, Donald G., ed. Public Planning and Control of Urban and Land Development: Cases and Materials. St. Paul, Minnesota: West Publishing Co., 1980.
Hardin, Garrett. "The Tragedy of the Commons." Man and the Environment. Dubuque, Iowa: William C. Brown Company Publishers, 1973.
Kelly, Eric Damian. "Piping Growth: The Law, Economics, and Equity of Sewer and Water Connection Policies." Land Use Law, July, 1984, pp. 3-8.
Lamm, Richard D., and MacCarthy, Michael. The Angry West:
A Vulnerable Land and Its Future. Boston: Houghton Mifflin Co., 1982.
Lindblom, Charles E. The Intelligence of Democracy. New York: The Free Press, 1965.
Mandelker, Daniel R., and Netsch, Dawn C. State and Local Government In a Federal System. New York: Bobbs-Merrill Company, Inc., 1977.
Naisbitt, John. Megatrends. New York: Warner Books, Inc., 1982.
Peirce, Neal R., and Hagstrom, Jerry. "Is Colorado A Tragedy in the Making?" The Denver Post Magazine, September 4, 1984, pp. 10-17.
Reich, Charles A. 733. 1964.
"The New Property."
73 Yale Law Journal
Rogel, Stuart, and Weitz, Steve. "Increasing Land Supply." Urban Land, April, 1984, pp. 2-7.
Schumacher, E.F. Small is Beautiful; Economics as if People Mattered. New York: Harper and Row Publishers, Inc., 1973.
Smith, Robert G. Ad Hoc Governments. Beverly Hills: Sage Publications, Inc., 1974.
U.S. Congress. Joint Economic Committee. Hard Choices: A Report on the Increasing Gap Between America's Infrastructure Needs and Our Ability to Pay for Them. Summary Report of the National Infrastructure Study. Washington, D.C.: Government Printing Office, February, 1984.
U.S. Department of Commerce. Bureau of the Census. United States Census of Population: 1980. Vol. 1, Characteristics of the Population, pt. 7, Colorado.
Ubbelohde, Carl; Benson, Maxine; and Smith, Duane A. A Colorado History. Boulder: Pruett Publishing Co., 1982.
The focus of this research project is to examine the process of gentrification and revitalization as a nationwide-city phenomenon and determine how that process relates to the process in Denver.
The main question to be addressed in this paper is what adverse social side effects, if any, does the private revitalization process have on Denver's neighborhoods and its low income residents. Two particular revitalizing neighborhoods have been chosen for this study; Curtis Park and Baker neighborhoods. The final focus of this research project is to determine what solutions are available or appropriate for guiding the reinvestment process in order to limit its side-effects.
The first step of this reserch project was to review and analysize available studies, observations and conclusions about the private revitalization process nationwide. By examining this literature common indicators of change in a revitalizing neighborhoods were chosen to be used in examining Curtis Park and Baker neighborhoods. The Curtis Park and Baker neigborhoods were chosen because they were considered to be undergoing the most private revitalization and displacement of all Denver neighborhoods (according to local planners). The next step in this research project was to compile all the secondary data available on these two neighborhoods. Sources of information included: A longitudinal study on revitalization of neighborhoods in six cities (including Denver) conducted by the Research Triangle Institute, A Princeton study on displacement-which included the Baker neighborhood, Neighborhood Plans and Annual Housing Reports from the Denver Planning Office, The East side Summary of Conditions and Neighborhood Improvement Plan prepared by the Department of Community Renewal Program (1972), Housing Development Strategies-Denver: the SO's prepared for the Denver Housing Authority(1982). The majority of the data used was taken from the U.S. Census tract and block data. Also used were relavant news clippings.
After the secondary information was compiled and tabulated an analysis was done to determine if any significant trends were taking place in Denver, specifically in the Baker and Curtis Park neighborhoods. Also examined was whether the common problems that occur in other revitalizing neighborhoods were present in Baker and Curtis Park neighborhoods.
The next step in the research project was reviewing available literature on ways to guide the revitalization process thereby lessening its adverse impacts on low-income residents.
The final phase of the research projects was to determine what programs or policies would be appropriate or feasible for guiding Denvers private reinvestment process.
Key Findings and Conclusions
Private revitalization and gentrification of city neighborhoods is a complex process with many variables influencing the process. Studies and research conducted on the subject have not always been conclusive about the actual impacts of gentrification and the course that the process takes. This inconclusiveness stems, in part, from the diversity of situations and conditions from city to city and even within different neighborhoods in each city. It therefore is imperative that local officials evaluate the process occurring within its own individual neighborhoods.
Two main concerns that emerge from the research literature on gentrification are displacement and the social integration and cohesiveness of neighborhoods undergoing gentrification. The displacement of existing low-income residents in a gentrifying neighborhood is one adverse side-effect of the private revitalization process. The broader scope of this problem is the permanent loss of affordable housing,in the inner city, for low and moderate income households and eventually even the lower middle class households. The national policy of housing is one
policy of housing filtering down to eventually become affordable to low income groups, is dampered by the existence of reinvestment in older city neighborhoods. The housing that has filtered down in the past to low income residents is being reclaimed by the grown children of the generation that fled to the suburbs.
This reversal has important implications for the future planning of housing policies for lower income groups.
The other major concern is the integration and social cohesiveness of neighborhoods undergoing private revitalization. The issue raised is whether race and class integration is a product of private revitalization or just a transitional phase of the process. Many neighborhoods, in the midst of the reinvestment process, have experienced conflicts between incumbent residents and newcomers. This conflict often arises over land use in the neighborhoods, particularly low income housing. As the revitalization process proceeds, often the gentrifiers become concerned about protecting their investment and seek a more homogenous neighborhood through zoning and land use controls.
Key Findings for Curtis Park and Baker
Key indicators for revitalization are evident in Curtis Park and Baker. These indicators include; spiraling increases in housing prices, the presence of multiple sales and speculation, the widespread conversions of multifamily housing back to single family units, the presence of the gentrifying age group, a large percentage of houses rehabilitated, a loss of the elderly population in Baker arid the displacement of residents in Baker. Curtis Park has experienced conflicts among its residents over land use issues.
Key Finding for Denver
Denver has the predeposition characteristics of a city that is prime for private reinvestment in its neighborhoods. The
qualities assumed to be needed for a neighborhood to have private reinvestment include; a substantial old well constructed housing stock', a capacity to employ a sizeable group of professional and/or managerial people, absentee ownership and a scarcity of housing in the surrounding areas. Additionally, Denver has a population of downtown employess who are open to moving in or near downtown.
Phillip Clay has studied many gentrifying city neighborhoods across the nation and has observed that once the process of private revitalization has started it does not reverse itself.
It would be safe to assume that the revitalization process in Baker and Curtis Park and other revitalizing neighborhoods will continue. After the recession in 1974 and 1975, Baker and the greater Curtis Park area experienced the most sales, speculation and renovation activity compared to the other years of its revitalization. As the interest rates drop,the pent-up demand for housing near and in downtown will likely emerge in the form of more sales and revitalization activity in these and other neighborhoods. As the demand for middle income housing increases in the city of Denver, the prices will be likely to increase also and low and moderate housing will continue to be permanently removed from the housing market.
The process of revitalization of a neighborhood is complex and involves many factors, therefore the guiding process will also be comprehensive and complex. Many programs and regulations are available to cities to use, if they are interested in guiding the reinvestment process. Providing new housing downtown for the upper income groups would help lessen the demands on the existing housing stock in city neighborhoods.
Dispersing the demand to non-gentrifying neighborhoods would be another way to help lessen the speculation activities in any one neighborhood. Many programs and regulations exists that could be used to protect low and moderate income housing in the city and to help keep housing affordable in the city of Denver.
Ratings of Downtown Locations as Desirable for Housing
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BAKER HOUSING PRICE INCREASE
Based on Research Triangle Institue Data