Democrats in the legislature and Gov. Jared Polis did not violate the Taxpayer’s Bill of Rights in Colorado’s constitution or state law when they enacted a slate of new transportation fees in 2021, a Denver judge ruled this week in rejecting case that threatened to upend road and transit funding.
A group of conservative activists sued the state and governor in 2022 to try to invalidate the fees, which are imposed on things like gasoline and diesel purchases, as well as deliveries and rideshare trips. They are slated to generate billions in revenue in their first decade, including more than $200 million in the current fiscal year, which ends June 30.
In a 34-page ruling issued April 29, Denver District Court Judge Andrew Luxen rejected arguments from the plaintiffs that elements of Senate Bill 260, the measure enacting the fees, required voter approval.
Luxen’s ruling averted a trial set to begin next week.
The plaintiffs in the lawsuit were the conservative political nonprofit Americans for Prosperity; Michael Fields, who leads the conservative political nonprofit Advance Colorado; former state Sen. Jerry Sonnenberg, who is currently running for Congress; and Rich Orman, an attorney.
Jesse Mallory, who leads the Americans for Prosperity branch in Colorado, says his group may appeal.
“We’re looking at the possibility as we speak,” he told The Colorado Sun on Friday.
The transportation fees imposed by Senate Bill 260 include:
- A 3 cent-per-gallon charge on gasoline and diesel fuel that increases by 1 cent each July until it reaches 8 cents per gallon in July 2028. In July 2032, the fee will be adjusted annually based on inflation.
- 27 cents on deliveries, such as those from Amazon, FedEx and Grubhub
- 30 cents on Uber and Lyft rides that will eventually increase based on inflation. The fee is cut in half for people carpooling in a rideshare, or riding in an electric vehicle.
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Colorado Democrats in recent years have increasingly turned to fees as a way to get around the requirement in TABOR that voters approve all new tax increases.
Under Colorado law, the legislature can impose fees without voter approval so long as the fee revenue is spent to offset the effects of activity that’s being charged and as long as the fees raise a limited amount of money or are collected by an existing state enterprise.
The legislature this year is debating whether to impose new fees on oil and gas production and people who rent cars to raise more money for transportation projects. The legislative session ends May 8.