The Telluride Watch
Published 1/22/08
by K.C. Mason

Years of legal wrangling over whether the scenic corridor into Telluride will be developed or protected as open space culminated in one hour’s worth of oral arguments in the Colorado Supreme Court this week.

Attorneys for Telluride and the San Miguel Valley Corporation had 30 minutes each Tuesday to convince seven high justices that case law supports their cause. At issue is the constitutionality of a 2004 law passed by the Colorado Legislature that prohibited Telluride from condemning 572 acres of the Valley Floor owned by SMVC’s Neal Blue.

“This case is not about a particular taking but the constitutionality of a statute which applies to every home rule city in the state,” argued SMVC attorney Darrell Waas. “That law would have prevented Telluride from taking the property that is at issue in this case.”

Waas said the state has a “compelling interest” in determining whether or not Colorado’s 300 cities and towns can use their power of eminent domain to condemn property outside their boundaries for open space, parks or recreation.

Telluride’s attorney, Leslie Field, countered that the state had no business overriding Telluride’s local interest in a legal use of condemnation powers. She said San Miguel County District Court Judge Charles A. Greenacre correctly declared as unconstitutional the so-called “Telluride amendment” to House Bill 1203.

“Telluride has ample power to condemn property under Article XX for open space, parks and recreational uses of lands immediately outside its municipal boundaries” Fields said. “House Bill 1203 is unconstitutional because it prohibits the exercise of that home rule power.”

Field said Article XX was passed by voters in 1907 to give Denver the use of eminent domain both inside and outside its boundaries. The same power was extended to home rule towns and cities 10 years later, she said.

A court spokesman said Chief Justice Mary Mullarkey knew within hours of Tuesday’s arguments which way her colleagues were leaning, but it would take two to four months for a decision to be written, vetted and rendered.

Among the estimated 35 to 40 Telluride residents who made the 360-mile drive to Denver to hear the arguments were nine Telluride High School students from advanced placement government and U.S. history classes.

Principal Alex Carter said the students later voted 6-3 in a straw poll that Telluride won its case.

“Six of them said the town has a core constitutional right to the condemnation, Carter said. “The other three said Waas had a better case and that the state has a right to restrict that authority.”

The court’s public information officer, Robert McCallum, cautioned against reading anything into the questions justices asked during the hearing.

“Trying to guess what the judges are thinking by the questions they ask may lead to problems,” McCallum said. “The justices are trying to get to the heart of the legal matter. It is very important that the public resist that temptation to second guess the justices’ opinions based on the questions they ask.”

However, the temptation was hard to resist for most of the hearing’s observers.

“If I had to guess, I’d say we probably ended up having a majority of judges on our side,” said Telluride Mayor Stu Fraser.

Jane Hickcox of the Valley Floor Preservation Partners agreed.

“I’m feeling very confident,” Hickcox said. “We all have our observations, but I see it as 5-2.”

Each attorney was asked what happens if they win their case.

“If the trial court reverses (Greenacre), the property is returned to the owner and the funds that have been held on deposit are returned to the town,” Waas said. “The great bulk of the 572 acres goes back to the owner if you reverse.”

Field said the people of Telluride win with a favorable ruling from the Supreme Court.

“It was Telluride citizens who initiated the ordinance to condemn the property,” she said. “It was the citizens of Telluride who orchestrated an extraordinary grassroots effort to raise the $50 million – every dollar the landowner said the property was worth.”

Fundraising intensified last springs after a District Court Jury in Delta sided with the price set by SMVC’s appraiser Larry Stark. Telluride’s appraisal came in at half that amount.

Waas had barely started his argument when Justice Gregory Hobbs interrupted with a question:

“You would agree that the power of eminent domain exists for public purpose upon payment of just compensation, would you not?”

When Waas replied “it can,” Hobbs immediately followed up with: “Wasn’t it the purpose of the statute [HB 1203] to retroactively prevent certain uses that the home rule city deemed to be for local purposes?”

Waas replied the statute was enacted to prevent “certain home rule cities from taking property outside the jurisdiction for certain specific purposes.”

Another Hobbs question of Waas: “Why was the statute required if your argument is that the home rule entity didn’t have the power in the first place to condemn for open space and parks outside of its boundaries?”

Waas replied the new issue for the court to decide is “whether the state – having an interest in the subject of extra-territorial condemnations – has the power to step in and say you can not take (property) for purposes that are not expressed (in the constitution.)

“In 100 years of case law, this precise issue presented by this case has never been decided,” he said.

Mullarkey asked Waas if HB 1203 was an “unconstitutionally retrospective piece of legislation.”

Waas replied: “That issue was not raised by the appellees because the case law is clear that the prohibition against retroactive legislation does not protect the government but it protects private parties.”

The questions directed to Field, including several from Justice Nathan Coats, had more to do with deciding the balance between state and local interests in condemnation proceedings.

A municipality’s regulatory action can trigger the possibility of a conflicting state interest, Field said, “but that is not what this case is about. This is a home rule municipality exercising its…core constitutional power of eminent domain.”

Justice Alex Martinez also focused on the balance issue.

“It is clear the General Assembly seemed to think there was a statewide interest and passed the statute that brings us all here today,” he said.

Field replied the legislative findings of HB 1203 don’t justify a compelling state interest. And when Hobbs suggested the bill “was drafted here by the corporation and introduced to stop this condemnation,” Waas defended his client.

“My client exercised its right to petition its government and did have some participation in the adoption of that statute,” Waas said. “My client didn’t do anything wrong.”

Waas had the last say in the hearing:

“My client’s interest is it doesn’t want its property taken, period,” he said. “The issue before you is not whether or not telluride should get its open space. The issue before you is whether or not this statute is unconstitutional and the standard is beyond a reasonable doubt.”

If you would like to hear the oral arguments, click here.