Marin District Taxes on Landmark Homeowners Declared Illegal – Burg Simpson Victory
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Marin District Taxes on Landmark Homeowners Declared Illegal – Burg Simpson Victory

September 19, 2019


Hi. I’m Dave Hersh, a shareholder at Burg
Simpson Eldredge Hersh & Jardine. I wanna talk to you today about a major
victory Burg Simpson won for Colorado taxpayers. This victory has a major impact on taxes
imposed on homeowners in Colorado. On September the 6th of this year, senior
District Court Judge Donald Marshall sitting in Arapahoe County
District Court entered an order in the Landmark Towers Association versus Marin Metropolitan District case. In that case,
Judge Marshall determined that the taxes that were being imposed
on the owners of the Landmark Towers were illegal. This is really the first case of
its kind in the state of Colorado. It’s unique because the judge ordered and determined the taxes the special
district was collecting are in fact illegal. It’s a case is going
to make a big difference for Colorado homeowners.
In this case, Judge Marshall considered a challenge to the taxes under TABOR – the taxpayer Bill of Rights. As you
recall the taxpayer Bill of Rights was passed
in 1992 by Colorado voters and it became a constitutional amendment. In
this case, Judge Marshall determined that the Metropolitan District had
imposed taxes on the residents that were illegal under TABOR. And the savings are significant.
For the homeowners, over one million dollars in past taxes already collected by the Marin
Metropolitan District must be refunded to them along with interest. In addition to that, between $17 million and $22 million
dollars of future taxes that were going to be collected now have
been declared illegal and cannot be collected. In addition to these millions of dollars
collected for the homeowners, Burg Simpson was able to recover the
costs and attorneys fees of prosecuting this action under TABOR. It’s common in Colorado land development
that a developer will form some sort of special district, or a metropolitan district, to pay for improvements to
property. TABOR, our constitutional provision, says
that the people who are going to be paying the taxes must be given a fair
opportunity to vote on raising their taxes. In this instance, the developer use technicalities and
frankly some sleight of hand to both create the district improperly and also to impose taxes on residents who had purchased the homes. Over 130
residents who had contracts to purchase homes had taxes imposed on them when they had
no opportunity to vote on the creation of the district,
the issuing of bonds for the district, or
the raising of taxes to pay for those bonds. In fact the residents of those properties were taxed to pay for improvements to
the next door property. It was a mechanism by which the
developer could— and this is a word I’ve actually never
seen a judge use in an opinion before— the developer foisted those taxes and the cost of developing that second
parcel off on the backs of the residence who had
already purchased their property. The result is that this Metropolitan
District was created without any homeowner votes, thirty million dollars in bonds were
issued by the metro district which the homeowners then had to repay,
taxes were raised by approximately three thousand dollars
per unit per year for the average homeowner, and the money
that was raised went to the pocket of the developer. In
his decision last week, Judge Marshall decided that the Constitution
in the state of Colorado trumps special-interest laws, and that it was illegal for taxpayers to be required to
pay taxes they did not have the opportunity to
vote on. This decision by Judge Marshall really puts
some teeth into TABOR. It’s entirely consistent with TABOR’s
language and purpose but it was hotly contested. This is a case that’s the first of its
kind to go to trial, but it gives taxpayers another tool to ensure that they are not
only being taxed, but being taxed in ways that are proper
and legal. I’m Dave Hersh, senior shareholder with
Burg Simpson Eldredge Hersh & Jardine, and co-chair of the commercial practice
group. If you’ve been affected by any the issues in this video blog, I’d
like to hear from you. you can reach me at 303-792-5595, or you can reach us online at burgsimpson.com.

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